AMRI Acquires Majority Interest in Organichem Corporation; Company Converts Organichem Debt into Additional Equity.

Business Editors/Health/Medical Writers

ALBANY, N.Y.--(BUSINESS WIRE)--Jan. 2, 2003

Dr. Donald E. Kuhla Transitions Role to Lead Integration

Albany Molecular Research, Inc. (Nasdaq: AMRI) today announced that it has exercised its conversion option with respect to $15 million of Organichem Corporation subordinated debentures.

The conversion into additional shares of Organichem common stock took effect on January 1, 2003, and increases AMRI's ownership in Organichem from 39.2% to 75%.

"The debenture conversion is a step towards AMRI's ultimate purchase of Organichem, which we expect to occur within the next few months," said AMRI Chairman and Chief Executive Officer Thomas E. D'Ambra, Ph.D. "Ownership of Organichem will provide AMRI customers with a one-stop, continuous range of resources from bench-scale synthesis to commercial cGMP manufacturing."

Organichem Corporation was founded in 1999 through a management led buyout of the Nycomed Amersham plc chemical manufacturing facility in Rensselaer, New York. AMRI was a founding investor in the formation of Organichem which was announced on December 21, 1999. AMRI's investment in Organichem included a $15 million equity investment for a 37.5% ownership and $15 million in debentures, which could be converted into additional equity in Organichem after three years.

The December 1999 investment agreement with Organichem also gave AMRI the option to purchase the remaining Organichem shares subsequent to the completion of Organichem's 2002 audited financial statements. AMRI has previously communicated its intention to exercise the purchase option. The purchase price is to be determined based on Organichem's financial performance in the year 2002. At this time, it is estimated that the purchase price will be approximately $30 million.

AMRI will begin consolidating Organichem's operating results effective January 1, 2003. In its previous status as a minority shareholder, AMRI only included its proportionate share of Organichem's net income in its income statement as equity in income of unconsolidated affiliates.

Integration Task Force

Dr. D'Ambra also announced today that AMRI President and Chief Operating Officer Donald E. Kuhla, Ph.D. has been appointed to lead the Organichem integration task force. In this capacity, Dr. Kuhla will work closely with Organichem President and Chief Executive Officer John Fallone to ensure a smooth and productive integration.

In addition, effective January 1, 2003, Dr. Kuhla has transitioned to part-time employment at AMRI and assumed the title of executive vice president. He will continue to report to Dr. D'Ambra. In his new role, Dr. Kuhla will remain a member of the company's leadership team and its board of directors, and will continue to manage many of his current responsibilities. AMRI has initiated a search for a senior-level scientific officer to assume oversight for certain functional areas for which Dr. Kuhla is currently responsible. Dr. Kuhla has been with the company since July 1998, and has served as a member of the company's board of directors since 1995.

"Dr. Kuhla's experience and leadership have been invaluable during the last several years, as AMRI has experienced a period of tremendous growth," said Dr. D'Ambra. "I am pleased that Don will remain involved in AMRI's future. As we now enter our next phase of growth, there is no person better suited to lead the integration."

Albany Molecular Research, Inc. is a leading research, drug discovery and development company built on a chemistry platform of comprehensive and integrated technologies, resources and capabilities. The company conducts pharmaceutical research and development with many leading pharmaceutical and biotechnology companies and for its own internal discovery programs.

Organichem Corporation is a full service, cGMP custom manufacturer specializing in process development, pilot to commercial scale synthesis, high potency, low temperature and controlled substance manufacture. The Organichem facility has manufactured ethical and over-the-counter drugs for more than 100 years, and was the primary bulk manufacturing site and center of manufacturing for Sterling Drug Inc. from 1917 until 1994, when the plant was sold to Nycomed. The facility employs approximately 235 individuals in Rensselaer, New York.

Statements in this press release that are not historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties. These statements may be identified by forward-looking words such as "may," "could," "should," "would," "will," "intend," "expect," "anticipate," "believe" and "continue" or similar words. Readers should not place undue reliance on our forward-looking statements. The company's actual results may differ materially from such forward-looking statements as a result of numerous factors, some of which the company may not be able to predict and may not be within the company's control. Factors that could cause such differences include, but are not limited to (a) Organichem's ability to successfully maintain its current customer relationships and attract new customers, (b) AMRI's ability to successfully integrate Organichem's operations with its own, and (c) the company's ability to extend its customer relationships to include the manufacturing services provided by Organichem, as well as those factors discussed in the company's Annual Report on Form 10-K for the year ended December 31, 2001 as filed with the Securities and Exchange Commission on April 1, 2002 and the company's other SEC filings. The company does not undertake any duty to and does not intend to update any forward-looking statements contained in this press release after the date of this press release.