First Horizon Launches Prenate GT and Signs Promotional Agreement With PDI.

Business Editors/Health Writers

ROSWELL, Ga.--(BUSINESS WIRE)--Sept. 20, 2001

First Horizon Pharmaceutical(TM) Corporation (Nasdaq: FHRX), a specialty pharmaceutical company, announced today it has launched Prenate GT(TM) (geltab), the newest addition to the Prenate line of prescription prenatal vitamins.

Prenate GT(TM) incorporates a patent-protected technology providing gel-coating on the tablets. The company also announced today that it has signed a promotional agreement with PDI, a leading sales and marketing company for the pharmaceutical, biotech, medical devices and diagnostic industries to support the launch of Prenate GT(TM). The Prenate line has been the market leader in prenatal vitamins in terms of prescriptions since 1993.

"We are extremely pleased to announce the launch of the geltab, Prenate GT(TM)," said Mahendra G. Shah, Ph.D., Chairman and CEO of First Horizon Pharmaceutical. "Market research indicates patients prefer gel-coating for easier swallowing and to mask the taste and smell of some of the ingredients. Prenate GT(TM) is the only prenatal vitamin tablet with this type of gel-coating. To add a significant product improvement such as this to a market leader like Prenate creates an opportunity for us to increase market demand for our product. We plan to invest in line extensions, which leverage the Prenate brand legacy, and utilize the gel-coating technology to address the needs of women during childbearing years. Our immediate priority is the successful launch of Prenate GT(TM). We are on track with our launch schedule."

Dr. Shah continued, "To maximize our promotional efforts during the launch period, we have signed an agreement with PDI. We chose PDI because of its experience in female health care and its proven ability to deliver results. We believe Prenate GT(TM) will quickly become the most recognized brand in this category and our partnering with PDI will help First Horizon achieve a successful launch of this product."

"Prenate GT(TM) is a good complement to Ponstel(R), our product for the treatment of primary dysmenorrhea," added Christopher Offen, Vice President and Chief Commercial Officer of First Horizon Pharmaceutical. "We have already achieved success with Ponstel(R) with OB/GYNs. With the physician relationships developed by our sales force in the OB/GYN specialty and the capabilities of PDI, we will attain the necessary reach and frequency to take Prenate GT(TM) to a market leader status like the previous formulations in the Prenate line," he commented.

Prenate GT(TM) benefits from a patented process held by Banner Pharmacaps, the company providing the Soflet(TM) technology to coat the tablets. The Soflet technology provides a hermetically sealed gelatin film around the core tablet, thereby differentiating the product through ease of swallowing while providing a tamper-evident, tasteless, odorless, protective layer. "We are excited to be working with First Horizon Pharmaceutical on their new Prenate GT(TM) product," noted Roger Gordon, Ph.D., President of Banner Pharmacaps, USA.

First Horizon has supply agreements with Patheon, the manufacturer of the tablet, and Banner Pharmacaps, the provider of the gel-coating technology. "We have exclusive long-term agreements with these two highly respected pharmaceutical companies, both of whom have impressive track records in the manufacturing arena. We look forward to long and mutually beneficial relationships with these companies," said Bala Venkataraman, Executive Vice President of Corporate Development and Chief Financial Officer of First Horizon.

"We expect PDI to augment First Horizon's efforts in reaching predetermined OB/GYN targets for which they will be paid on the number of completed calls. This arrangement works very well as it allows us to optimize the reach and frequency to key physicians during the launch period. The costs associated with this agreement are reflected in the guidance, previously provided by the company, for the remainder of 2001 and 2002," he added.

"The Prenate line acquisition and the new Prenate GT(TM) product reflect our continued efforts in building our OB/GYN therapeutic franchise. We continue to seek acquisition and in-licensing opportunities that will augment our cardiology, respiratory and gastroenterology franchises," said Dr. Shah.

Prenate GT(TM) is a comprehensive, single-dose, vitamin geltab containing 17 vitamins and minerals, including calcium, carbonyl iron and folic acid, plus docusate sodium. Like Prenate Advance(TM), Prenate GT(TM) is one of the few prenatal vitamins that meet the standards for folic acid dissolution established by the United States Pharmacopoeia.(1)(2) Medical Research has shown that women who consume adequate amounts of folic acid before and during pregnancy may reduce their risk of having a baby born with neural tube birth defects(3)(eg., spina bifida) by up to 72%.

According to National Vital Statistics Report, there were an estimated 6.19 million U.S. pregnancies in 1997.(4) Prescription prenatal vitamins are generally recommended to these patients so that they receive adequate amounts of essential vitamins and minerals. Folic acid, iron, calcium and vitamin A are considered essential to fetal development. According to IMS Health Retail and Provider Perspective data, total U.S. sales of prescription prenatal vitamins were $115 million in 2000.

First Horizon Pharmaceutical(TM) Corporation is a specialty pharmaceutical company that markets and sells 14 brand name prescription drugs to high-prescribing primary care and select specialty physicians through its nationwide sales and marketing force. The Company focuses on the treatment of chronic conditions, including cardiovascular diseases and respiratory, gastroenterological and gynecological disorders.

PDI is an innovative sales and marketing company in the pharmaceutical, biotech, and medical devices and diagnostic industries. Partnering with clients, PDI provides product-specific plans designed to maximize profitability from pre-launch through maturity. With a solid sales and marketing infrastructure, proven industry experience and over 4,000 sales and marketing professionals, PDI has the demonstrated ability to deliver return on investment.

PDI is recognized as an industry leader based on its entrepreneurial efforts to keep pace with a changing industry. PDI leverages its expertise in sales, brand management and product marketing, marketing research, medical education, medical affairs, and managed markets and trade relations to create solutions that meet strategic objectives and provide incremental value for product sales.

This press release may contain statements, which constitute forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements relate to analysis and other information which are based on forecasts for future results and estimates of amounts not yet determinable. These statements also relate to our future prospects, developments and business strategies.

These forward-looking statements are identified by their use of terms and phrases such as "expect," "believe," "may," "plan," "seek" and similar terms and phrases, including references to assumptions. These statements include, but are not limited to, statements regarding the following: (i) the success of the launch of Prenate GT(TM) and brand recognition, (ii) the ability of Prenate GT(TM) to achieve market leader status, (iii) the financial impact of the acquisition of Prenate to the Company's earnings, and (iv) the implementation and success of the Company's launch of the Prenate line.

Such statements are subject to certain factors, risks and uncertainties that may cause actual results, events and performance to differ materially from those referred to in such statements, including that (i) the Company does not have experience marketing and selling prenatal vitamins, which may adversely impact the Company's launch of Prenate GT(TM) and the Company's ability to maintain sales of Prenate Advance(TM), (ii) patent rights do not protect the Prenate products from competition, and (iii) the regulatory status of prenatal vitamins may make Prenate products subject to increased competition. Such risks also include, without limitation, those identified in the Company's registration statement on Form S-1 filed with the Securities and Exchange Commission in the "Risk Factors" section under the following headings: "We currently depend on four key products for a large portion of our sales, and substantial declines in any of them would result in our being unprofitable"; "There is no assurance of continued commercial acceptance of our products"; "Our growth will suffer if we do not acquire rights to new products and integrate them successfully"; "We may encounter problems in the manufacture of our products that could limit our ability to sell our products"; "We face competition from generic products that could lower prices and unit sales"; "Strong competition exists for our products, and competitors have introduced new products and therapies that could make our products obsolete"; "A small number of customers account for a large portion of our sales, and the loss of any of them, or changes in their purchasing patterns could result in our inability to successfully sell our product"; "If our products under development fail in clinical studies or if we fail or encounter difficulties in obtaining regulatory approval for new products or new uses of existing products, we will have expended significant resources for no return"; "Our acquisition of Cognex(R) creates additional risks"; "We or third parties may violate government regulations and we may incur significant expenses to comply with such regulations"; "If third-party payors do not adequately reimburse patients for our products, doctors may not prescribe them"; "Product liability claims and product recalls could limit our ability to sell products"; "We expect to require additional funding, and if we cannot obtain it, our sales, profits, acquisitions and development projects could suffer"; "If we do not secure or enforce our patents or other intellectual property rights, we could encounter increased competition that could adversely affect our operating results"; "Our products could infringe the intellectual property rights of third parties, which could require us to pay license fees or defend litigation that could be expensive or prevent us from selling products"; "The regulatory status of some of our products makes these products subject to increased competition and other risks"; "We face risks under one of our development agreements because the other party to the agreement is a related party"; and "Pohl-Boskamp can terminate our rights to Nitrolingual(R)." We do not undertake to update our forward-looking statements to reflect future events or circumstances.

(1) Hoag SW, Ramachandruni H., Shangraw RF. Failure of prescription prenatal vitamin products to meet USP standards for folic acid dissolution. J Am Pharm Assoc. 1997; NS37:397-400.

(2) Giebe K, Counts C. Comparison of Prenate Advance(TM) with other prescription prenatal vitamins; a folic acid dissolution study. Advances Ther. 2000; 17:179-183.

(3) MRC Vitamin Study Research Group. Prevention of neural tube defects: results of the Medical Research Council Vitamin Study. Lancet. 1991; 338:131-137.

(4) Trends in Pregnancy Rates for the United States, 1976-1997: An Update (Published by CDC), Volume 49, Number 4, 2001.