Bio-Technology General Corp. Receives NASDAQ Notification.

Business Editors & Health/Medical Writers

BIOWIRE2K

ISELIN, N.J.--(BUSINESS WIRE)--Aug. 29, 2002

Bio-Technology General Corp. (NASDAQ: BTGC) today announced receipt of a letter from NASDAQ indicating that BTG had not complied with Marketplace Rule 4310(c)(14) because its consolidated financial statements included in its Quarterly Report on Form 10-Q for the period ended June 30, 2002 have not been reviewed by its independent auditors in accordance with Statement on Auditing Standards No. 71 because of the restatement and reaudit previously disclosed, and discussed below, and that its securities are therefore subject to delisting from the NASDAQ National Stock Market.

BTG will request a hearing before a NASDAQ Listing Qualifications Panel to appeal the potential delisting from NASDAQ, which will be stayed, pending the panel's decision, although there can be no assurance that the NASDAQ Listing Qualifications Panel will grant the request for continued listing by BTG. In the interim, effective August 29, 2002, BTG's stock will trade on NASDAQ under the symbol BTGCE.

BTG is working diligently with KPMG to complete the reaudit which it anticipates will be completed during September 2002. Upon completion of the reaudit, BTG will file an amended annual report on Form 10-K and amended quarterly reports to reflect the reaudit. BTG anticipates that the filing of these amended reports will cure any deficiency and allow BTG to remain listed.

As previously disclosed, on May 8, 2002 BTG engaged KPMG LLP as its independent auditors replacing Arthur Andersen LLP. In August 2002, BTG announced that in connection with a reaudit by KPMG it would be restating its financial statements for the years ended 1999 through 2001 to expense (i) the costs associated with establishing alternate manufacturing sources for its approved drug Oxandrin(R) and for a new tablet formulation, which costs were previously capitalized, and (ii) compensation for certain employees and former employees made in connection with the termination of their employment and post-employment consulting arrangements, which expense should have been recognized at the time of modification.

Dr. Sim Fass, Chairman and Chief Executive Officer, stated: "Our being out of compliance relates exclusively to the fact that KPMG could not review our second quarter 2002 filing until the reaudit of 1999 through 2001 is completed. We are well along in the reaudit process and anticipate its completion and the filing of amended financial reports by the end of September. We believe that our 2002 financial results will not be impacted negatively by the reaudit and that our third quarter 2002 and annual filings will be timely."

Statements in this news release concerning BTG's business outlook or future economic performance, anticipated profitability, revenues, expenses or other financial items; and statements concerning assumptions made or expectations as to any future events, conditions, performance or other matters, are "forward-looking statements" as that term is defined under the Federal Securities Laws. Forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results to differ materially from those stated in such statements. Such risks, uncertainties and factors include, but are not limited to, changes and delays in product development plans and schedules, customer acceptance of new products, changes in pricing or other actions by competitors, patents owned by BTG and its competitors, and general economic conditions, as well as other risks detailed in BTG's filings with the Securities and Exchange Commission.