DUSA Pharmaceuticals reports second quarter results.

MISSISSAUGA, Ontario--(BUSINESS WIRE)--Aug. 6, 1996--DUSA Pharmaceuticals Inc. (NASDAQ NMS:DUSA), today reported its financial results and research progress for the second quarter ended June 30, 1996.

The loss for the quarter was ($1,885,078), or ($0.21) per share, compared to a loss of ($731,468), or ($0.13) per share, for the same period last year. Research and Development expenditures related to the company's ALA Photodynamic Therapy (PDT) development program totaled $1,808,571 for the quarter, compared to $631,627 for the same period last year.

At June 30, 1996, the company's cash and U.S. Government securities position was $23,328,728 compared to $9,552,532 at the same time last year, and its shareholders' equity was $22,320,827 compared to $9,392,693. These figures reflect the net proceeds of a public offering of 750,000 shares which was completed on May 1, 1996.

Dr. D. Geoffrey Shulman, president and chief executive officer, stated, "R&D expenditures increased significantly during the quarter, in line with the company's greatly expanded ALA photodynamic therapy (PDT) and photodiagnosis (PD) clinical trial programs.

"For example, DUSA completed its Phase IIb clinical trial for the treatment of precancerous actinic keratoses (AK) with up to 100% complete clearing, an important milestone for the company; started an additional Phase IIb AK study (Phase III trials are scheduled to begin in Q4); and continued intensive preparations for a multi-center trial using ALA photodiagnosis (PD) for the early detection of bladder cancer. Development work also continued on ALA PDT(TM) for hair removal, acne, and endometrial ablation."

In addition, during the quarter, at the American Society of Photobiology Meeting in Atlanta, the company publicly presented for the first time its proprietary low cost, simple to use, non-laser light source for use in ALA PDT(TM) of AK; and announced its trademark, Levulan(TM) for DUSA formulations of ALA.

DUSA cautions that the statements made in this press release may affect the company's actual results and could cause such results to differ materially from forward-looking statements made by or on behalf of the company. Such factors include, but are not limited to, changing market conditions, clinical results of its trials, the impact of competitive products and pricing, the timely development, FDA approval and market acceptance of the company's products, and other risks detailed from time to time in the company's publicly filed documents including its Form S-2 dated April 22, 1996.

DUSA Pharmaceuticals Inc. is a development stage New Jersey pharmaceutical company engaged primarily in the development of ALA Photodynamic Therapy ("PDT") and Photodiagnosis ("PD") for multiple medical indications. PDT and PD utilize light-activated compounds such as ALA to induce a therapeutic or diagnostic effect. DUSA is a leader in topically or locally applied PDT and PD. -0-

                                 DUSA Pharmaceuticals Inc.
                                   Financial Highlights

                         Three Months Ended        Six Months Ended
                               June 30,                 June 30,
                         1996          1995        1996         1995

Interest income        $ 311,566   $ 144,546    $ 580,268    $ 309,565
Research and
 development costs     1,808,571     631,627    2,759,098    1,344,846
Other operating
 expenses                387,933     280,026      814,524      578,313
Net (loss)           ($1,885,078)  ($731,468) ($2,995,250) ($1,616,072)
(Loss) per share          ($0.21)     ($0.13)      ($0.34)      ($0.30)
Average number of
 shares outstanding    9,095,892   5,438,500    8,819,267    5,438,500
Cash and U.S.
 Government
 securities          $23,328,728 $ 9,552,532  $23,328,728  $ 9,552,532
Shareholders'
 equity              $22,320,827 $ 9,392,693  $22,320,827  $ 9,392,693

               (All figures are in U.S. dollars and unaudited)

CONTACT: DUSA Pharmaceuticals Inc., Mississauga

D. Geoffrey Shulman, MD, FRCPC

905/677-4554

Fax: [phone]

or

Sunrise Financial Group, New York

Derek Caldwell, 212/421-1616

Fax: [phone]