Andrx Group Reports Third Quarter 2001 Earnings; Reports $0.35 Per Diluted Share.

Business Editors/Health and Medical Writers

FORT LAUDERDALE, Fla.--(BUSINESS WIRE)--Oct. 25, 2001

Andrx Corporation today announced financial results for the three and nine month periods ended September 30, 2001, for the Andrx Group ("Andrx") (Nasdaq:ADRX), representing the businesses of Andrx Corporation and its subsidiaries other than the Cybear Group.

For the third quarter of 2001, Andrx reported total revenues of $211.3 million, compared to $129.9 million for the same quarter of 2000, an increase of 62.7%. Andrx also reported net income of $25.3 million, or $0.35 per diluted share, compared to pro forma net income of $18.4 million, or pro forma $0.26 per diluted share, for the same period of 2000. For the nine months ended September 30, 2001, total revenues were $545.4 million, which represents a 46.4% increase over total revenues of $372.5 million for the same period in 2000. Andrx reported net income of $68.6 million, or $0.95 per diluted share, for the first nine months of 2001, compared to pro forma net income of $60.0 million, or pro forma $0.87 per diluted share, for the nine months ended September 30, 2000. Results of operations for the 2000 periods, as reported in this press release, are pro forma, as they exclude the net losses of Cybear Group, although the reorganization that enables Cybear Group's results to be excluded from Andrx did not become effective until September 7, 2000.

Commenting on the quarter's results, Angelo C. Malahias, Andrx's Vice President and Chief Financial Officer, stated: "We have once again produced solid financial results. Progress continues to be made in all business segments, led by our distribution operations' record sales and gross profits. Sales of Andrx products remained strong. Our albuterol metered dose inhaler product, which we acquired with our acquisition of Armstrong for $18 million in March of 2001, experienced another quarter of net sales exceeding $20 million. In our brand segment, we launched the recently acquired Entex(R) line and have doubled our national sales force since June 30, 2001, to approximately 300. R&D spending continues to provide us with a rich pipeline of both brand and generic products, including four ANDAs filed this quarter."

Andrx President, Elliot F. Hahn, Ph.D., said, "We recognize that legal tactics and other external factors could continue to temporarily delay the launch of our bioequivalent versions of Glucophage(R), Tiazac(R) and Naprelan(R) and, despite renewed court activity aimed at ending ongoing infringement litigation and bringing a generic version of Prilosec(R) to market as soon as possible, it is unlikely that we will risk launching that product in the fourth quarter. We also recognize that we are facing a changing competitive environment for albuterol. Rather than focusing on short-term results, Andrx will continue to invest in R&D and build a brand business with a 500 person national sales force by the first half of 2002, when we expect to launch Altocor(TM), our first internally developed brand product. This long-term commitment is further evidenced by the termination of the Geneva agreement, whereby in relinquishing $3 million in quarterly revenue, we reacquired certain marketing rights, and thus now have exclusive worldwide marketing rights for our Metformin(TM) XT and Altocor(TM) brand products. These growth initiatives, if not offset by new product launches, will put pressure on near-term earnings. Yet we remain confident that this long-term perspective will maximize shareholder value by both maintaining our position as one of the premier generic companies and continuing to develop Andrx's brand business to national prominence."

Mr. Malahias added, "Should legal tactics continue to delay the launch of our generic versions of Tiazac, Glucophage, Prilosec and Naprelan, we anticipate that future earnings will be lower than our third quarter's financial results. In the fourth quarter, we anticipate a decrease in sales of albuterol. Additionally, revenues will not include $3 million per quarter from Geneva due to the termination of the agreement. We also anticipate increases in R&D, and selling, general and administrative expenses related to growth in our brand business and increases in legal expenses preparing for, and engaging in, our scheduled December 5th Prilosec trial."

For the third quarter of 2001, sales from distributed products increased by 60.6% to $132.8 million, compared to $82.7 million for the same quarter in 2000. Sales in the third quarter of 2001 include Andrx's participation in the distribution of generic Prozac(R) for which the 180-day period of marketing exclusivity expires in January 2002.

Sales of Andrx products were $72.7 million for the third quarter of 2001, compared to $43.1 million for the third quarter of 2000, a 68.8% increase. Andrx products included sales of Andrx's bioequivalent versions of Dilacor XR(R) and Cardizem(R) CD; and commencing on April 1, 2001, Andrx's bioequivalent version of Ventolin(R) (albuterol metered dose inhaler). Commencing on January 24, 2001, Andrx products also included sales of brand products marketed by CTEX Pharmaceuticals, Inc. ("CTEX"), which Andrx acquired on January 23, 2001. In the 2001 third quarter, Andrx products also included the sales of the Entex(R) brand product line, which Andrx acquired on June 30, 2001. Third quarter 2001 net sales did not include any net sales of the pain product line Andrx licensed from Mallinckrodt. The pain product line will be marketed in November under the new trade name Anexsia(R).

In the third quarter of 2001, Andrx generated $5.7 million of other revenues, compared to $4.1 million for the same period last year. Other revenues primarily represented licensing fees from Geneva related to brand products under development in Andrx's NDA program and, commencing April 1, 2001, revenues from Armstrong Pharmaceuticals, Inc.'s contract manufacturing business.

Gross profit generated from total revenues was $81.1 million, with a gross margin of 38.4% in the third quarter of 2001, compared to $54.0 million, with a gross margin of 41.6% in the third quarter of 2000. The increase in gross profit was a result of the increase in total revenues, and the decrease in gross margin was a result of a change in the product mix including the distribution of Prozac(R), which was first distributed as a generic in August of 2001.

Selling, general and administrative expenses were $36.1 million, or 17.1% of total revenues, for the third quarter of 2001, compared to $16.1 million, or 12.4% of total revenues, for the third quarter of 2000. The increase in selling, general and administrative expenses in the third quarter of 2001, compared to the third quarter of 2000, was primarily the result of the increase in total revenues and the continued building of the brand sales and marketing infrastructure. As of September 30, 2001, Andrx had approximately 300 sales representatives. The Andrx sales force will market the current Andrx brand products, including the Entex and Anexsia product lines, as Andrx continues to expand its sales force in anticipation of the 2002 launch of its first internally developed NDA product, Altocor, a high-potency, extended-release lovastatin.

Research and development expenses were $11.2 million in the third quarter of 2001, compared to $14.6 million in the third quarter of 2000. During the third quarter of 2001, Andrx filed four Abbreviated New Drug Applications (ANDAs) with the FDA, including an ANDA for Claritin(R) D-12, for which Andrx has been sued for patent infringement.

In the third quarter of 2001, Andrx reported income taxes of $11.1 million, or 31% of income before income taxes, compared to $6.8 million, or 27% of income before income taxes, for the same quarter of last year.

The diluted weighted average shares of Andrx common stock outstanding were 72.9 million and 72.6 million for the three months and nine months ended September 30, 2001, respectively. The diluted weighted average shares of Andrx common stock outstanding were 71.9 million and 68.6 million for the three months and nine months ended September 30, 2000, respectively. The increases in the diluted weighted average shares of common stock outstanding in the third quarter of 2001 and the nine months ended September 30, 2001, were attributable to stock option exercises and approximately 291,000 shares issued in January 2001 in connection with the acquisition of CTEX. The nine months ended September 30, 2001, also includes the full effect of the May 2000 Andrx public equity offering of 5.2 million shares.

On September 7, 2000, Andrx Corporation completed a reorganization whereby Andrx Corporation acquired the outstanding equity of its Cybear Inc. subsidiary that it did not own, reincorporated in Delaware, and created two new classes of common stock - Cybear common stock (Nasdaq:CYBA), to track the performance of the Cybear Group, which includes: a) Cybear Inc., and its subsidiaries, b) certain potential future Internet businesses of Andrx Corporation, and c) effective April 2, 2001, Mediconsult.com, Inc. and its subsidiaries ("Mediconsult") and Andrx common stock to track the performance of Andrx Group, which includes Andrx Corporation and its subsidiaries, other than its ownership of: a) Cybear Inc. and its subsidiaries, b) certain potential future Internet businesses of Andrx Corporation, and c) effective April 2, 2001, Mediconsult. In connection with the reorganization, Andrx shareholders exchanged each share of Andrx common stock held (pre-reorganization) for one share of Andrx common stock and .0372 shares of Cybear common stock.

Andrx common stock is a class of common stock of Andrx Corporation but is designed to reflect Andrx's performance. Holders of Andrx common stock have no specific rights to the assets of Andrx. Andrx Corporation continues to hold title to all its assets and is responsible for all of its assets, liabilities, operating results and cash flows, regardless of how it allocates assets and liabilities among the classes of stock for financial statement presentation purposes. Holders of Andrx common stock are therefore subject to the risks of investing in the businesses, assets and liabilities of Andrx Corporation as a whole. For instance, the assets allocated to each class of stock may be subject to company-wide claims of creditors and stockholder litigation.

Andrx is engaged in the formulation and commercialization of oral controlled-release pharmaceuticals utilizing its proprietary drug delivery technologies. In its ANDA program, Andrx is developing generic versions of selected high sales volume controlled-release brand name pharmaceuticals. In its NDA program, Andrx is developing its own brand name formulations of certain existing drugs that it believes may be improved by the application of Andrx's drug delivery technologies. Andrx also markets and distributes pharmaceutical products manufactured by third parties. Through Andrx Corporation's Cybear Group, Andrx Corporation intends to use the Internet to improve the efficiency of clinical, administrative and communications tasks in the healthcare industry -- while addressing the healthcare industry's critical need for secure and reliable transmission of information. Cybear also includes the Cybearclub LC joint venture with Andrx, which distributes healthcare products to physicians through the Internet.

Forward-looking statements (statements which are not historical facts) in this release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. For this purpose, any statements contained in this report that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the generality of the foregoing, words such as "may," "will," "to," "expect," "believe," "anticipate," "intend," "could," "would," "estimate," or "continue" or the negative or other variations thereof or comparable terminology are intended to identify forward-looking statements. Investors are cautioned that all forward-looking statements involve risk and uncertainties. Andrx common stock is a class of common stock of Andrx Corporation, therefore Andrx Corporation stockholders are subject to the risks and uncertainties described in Andrx Corporation's filings with the U.S. Securities and Exchange Commission, including Andrx Corporation's Annual Report on Form 10-K for the year ended December 31, 2000 and its Quarterly Reports on Form 10-Q for the quarters ended March 31, 2001 and June 30, 2001.

This release and additional information about Andrx Group and Andrx Corporation are also available on the Internet at: http://www.andrx.com.

                              ANDRX GROUP
         (Representing Andrx Corporation and its subsidiaries
                     other than the Cybear Group)
         UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME
        (in thousands, except for share and per share amounts)



                       Three Months Ended        Nine Months Ended
                         September 30,             September 30,
                 --------------------------   ------------------------
                    2001         2000(a)         2001         2000(a)
                 -----------   ------------   -----------  -----------
Revenues
  Distributed
   products      $   132,842   $     82,732   $   346,451  $   228,039
  Andrx products      72,736         43,101       182,966      133,209
  Other                5,682          4,051        15,986       11,227
                 -----------   ------------   -----------  -----------

Total revenues       211,260        129,884       545,403      372,475
                 -----------   ------------   -----------  -----------

Operating expenses
  Cost of goods
   sold              130,154         75,910       327,690      210,873
  Selling,
   general and
   administrative     36,075         16,088        86,518       41,968
  Research and
   development        11,158         14,646        40,212       33,340
  Reorganization
   costs                   -          2,098             -        2,098
                 -----------   ------------   -----------  -----------
Total operating
 expenses            177,387        108,742       454,420      288,279
                 -----------   ------------   -----------  -----------
Income from
 operations           33,873         21,142        90,983       84,196

Other income
  Investment
   income, net         2,498          4,003         8,768        6,559
                 -----------   ------------   -----------  -----------
Income before
 income taxes         36,371         25,145        99,751       90,755

Income taxes          11,120          6,782        31,130       30,762
                 -----------   ------------   -----------  -----------

Net income       $    25,251   $     18,363   $    68,621  $    59,993
                 ===========   ============   ===========  ===========

Basic net income
 per share       $      0.36   $       0.27   $      0.98  $      0.91
                 ===========   ============   ===========  ===========

Diluted net
 income per
 share           $      0.35   $       0.26   $      0.95  $      0.87
                 ===========   ============   ===========  ===========
Basic weighted
 average shares
 of common stock
 outstanding      70,155,000     69,076,000    69,876,000   65,892,000
                 ===========   ============   ===========  ===========
Diluted weighted
 average shares
 of common stock
 outstanding      72,941,000     71,862,000    72,614,000   68,629,000
                 ===========   ============   ===========  ===========

      (a) For the 2000 periods, the unaudited condensed consolidated
statements of income are pro forma as they exclude the net losses of
Cybear Group, although the reorganization that enables Cybear Group's
results to be excluded from Andrx Group did not become effective until
September 7, 2000.

                             ANDRX GROUP
         (Representing Andrx Corporation and its subsidiaries
                     other than the Cybear Group)
           UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
                            (in thousands)

                              September 30,        December 31,
                                  2001                 2000
                            ----------------     ----------------
        Assets

Cash, cash equivalents
 and investments
 available-for-sale         $        299,909     $        320,108

Accounts receivable, net,
 inventories and other
 current assets                      324,434              223,551
                            ----------------     ----------------
Total current assets                 624,343              543,659

Property, plant and
 equipment, net and
 other assets                        173,542               85,394
                            ----------------     ----------------

Total assets                $        797,885     $        629,053
                            ================     ================

  Liabilities and Group Equity

Total liabilities           $        168,135     $        106,807

Group equity                         629,750              522,246
                            ----------------     ----------------
Total liabilities and
 group equity               $        797,885     $        629,053
                            ================     ================