Mylan Reports Record Third Quarter Revenue and Increases Fiscal 2003 Earnings Guidance.

Business Editors

PITTSBURGH, Pa.--(BUSINESS WIRE)--Jan. 30, 2003

Mylan Laboratories Inc. (NYSE: MYL):

Mylan Announces Fiscal 2004 Earnings Guidance

Financial Highlights

-- our ability to successfully develop, license or otherwise acquire and introduce new products on a timely basis in relation to competing product introductions;

-- our ability to obtain required FDA approvals for new products on a timely basis;

-- uncertainties regarding continued market acceptance of and demand for our products;

-- our periodic dependence on a relatively small group of products as a significant source of our net revenue or net income;

-- the effects of vigorous competition on commercial acceptance of our products and their pricing;

-- the high cost and uncertainty associated with compliance with extensive regulation of the pharmaceutical industry;

-- the significant research and development expenditures we make to develop products, the commercial success of which is uncertain;

-- the possible loss of business from our concentrated customer base;

-- the potential costs and product introduction delays that may result from use of legal, regulatory and legislative strategies by our competitors;

-- our dependence on third party suppliers and distributors for the raw materials, particularly the chemical compound(s) which produces the desired therapeutic effect, the active ingredient we use to manufacture our products;

-- the possible negative effects of any interruption of manufacturing of our generic products at our principal facility;

-- the effects of consolidation of our customer base;

-- uncertainties regarding patent, intellectual and other proprietary property protections;

-- the expending of substantial resources associated with litigation involving patent or other intellectual property protection of competing products;

-- possible reductions in reimbursement rates for pharmaceutical products;

-- our exposure to lawsuits and contingencies associated with our business;

-- our exposure to risks inherent in acquisitions or joint ventures;

-- our ability to attract and retain key personnel;

-- possible adverse effects resulting from any significant decline in the value of securities that we hold or from uninsured losses of funds;

-- uncertainties and matters beyond the control of management, which could affect the Company's earnings guidance, as well as the subjectivity inherent in any probability weighted analysis underlying our assumptions and estimates with respect to the future; and

-- inherent uncertainties involved in the estimates and judgments used in the preparation of financial statements in accordance with GAAP and related standards.

Mylan Laboratories Inc. (NYSE: MYL) announced net earnings of $68.4 million, or diluted earnings per share of $.37 ($.55 pre-split) for the third quarter ended December 31, 2002.

This compares to $.41 per diluted share ($.61 pre-split) for the same prior year quarter. For the nine months ended December 31, 2002, net earnings increased 3% to $198.5 million, or $1.05 per diluted share ($1.57 pre-split), compared to net earnings of $193.0 million, or $1.01 per diluted share ($1.52 pre-split) in the prior year period. Share and per share amounts in this press release have been adjusted to reflect the three-for-two stock split which occurred on January 27, 2003.

Mylan also announced that it anticipates fiscal 2004 earnings per diluted share to be approximately $1.59 to $1.69 ($2.38 to $2.53 pre-split) and is increasing its fiscal 2003 annual guidance to between $1.39 and $1.42 per diluted share ($2.09 to $2.13 pre-split). "We are pleased to deliver our guidance for 2004, which is consistent with our long-term goal of growing our company's operations by an average of 15% or more per year," stated Robert J. Coury, Vice Chairman and CEO of Mylan.

Net revenues for the third quarter of fiscal 2003 were a record $320.5 million compared to $297.2 million for the prior year quarter, an increase of 8%. Mylan's higher revenues were led by its Brand Segment, primarily Bertek Pharmaceuticals Inc. ("Bertek"), which reported record net revenues of $66.6 million, an increase of 86% over the same prior year period. Bertek's record net revenues were driven by the launch of Amnesteem(TM) and increased revenues from three major existing products, Digitek(R), phenytoin, and Acticin(R). Mylan's Generic Segment reported net revenues of $253.9 million, a 3% decrease over the same prior year period, primarily due to the loss of exclusivity on buspirone in February 2002. Excluding the impact of buspirone, net revenues for the quarter ended December 31, 2002, increased by $40.4 million or 19%, primarily attributable to new products launched subsequent to December 31, 2001, as well as volume increases and stable pricing.

"We are excited about the introduction of Amnesteem by Bertek Pharmaceuticals and its financial performance. The successful launch of Amnesteem, which quickly captured a market share of over 29%, demonstrates the ability of Bertek to effectively bring to market products for which there exist stringent patient education and risk management requirements," commented Robert J. Coury. Additionally, Louis DeBone, President and Chief Operating Officer of Mylan Laboratories Inc., stated, "We remain pleased by the performance of our Generic Segment, which continues to grow to meet the strong, ongoing demand for our products. Our core business has demonstrated sustained growth even without the one-time benefit of a product such as buspirone in the prior year."

Net revenues for the nine months ended December 31, 2002, were $915.5 million compared to $821.5 million in the same prior year period, an increase of 11% or $94.1 million. The increase was driven predominately by new products launched subsequent to December 31, 2001, which generated net revenues of $76.7 million, with the remaining increase attributable to favorable volume and pricing on both existing generic and branded products. Generic net revenues for the current nine month period were $763.8 million, an increase of $39.8 million or 6% over the same prior year period. This increase in net revenues was realized despite the loss of exclusivity on buspirone in February 2002. Excluding the impact of buspirone, generic net revenues for the nine months ended December 31, 2002, were $747.1 million compared to $601.7 million in the same prior year period, an increase of $145.4 million or 24%. Net revenues for the Brand Segment increased $54.2 million or 56% to $151.7 million.

Fourth Quarter and Fiscal 2003 Earnings Guidance

The Company anticipates diluted earnings per share of between $.34 and $.37 ($.51 to $.55 pre-split) for the fourth quarter ending March 31, 2003, and increases its guidance for fiscal 2003 to between $1.39 and $1.42 per diluted share ($2.09 to $2.13 pre-split). The guidance does not take into account the agreement in principle that was reached with Bristol-Myers Squibb to resolve all disputes related to buspirone and paclitaxel, as discussed in the Company's press release dated January 7, 2003, since that agreement has not yet been finalized.

Fiscal 2004 Earnings Guidance

Mylan's fiscal 2004 earnings guidance reflects a continuation of the success achieved to date in fiscal 2003. Financial performance in the pharmaceutical industry is difficult to predict given its regulatory environment, competition within the industry at market formation and throughout a product's life cycle, the increasingly litigious nature of the research and development and product approval process, and the other risks associated with our business. Therefore, when developing the fiscal 2004 financial guidance, management probability weighed all factors which it believes will influence its results of operations. For risk factors associated with our business, including our future financial performance, please read carefully our most recently filed quarterly report on Form 10-Q and Mylan's other periodic SEC filings.

Based upon this approach and analysis, the Company believes that its fiscal 2004 forecasted earnings per diluted share will be approximately $1.59 to $1.69 ($2.38 to $2.53 pre-split), based on the following expectations: net revenue growth of 9 to 11%; gross margins of approximately 52 to 55%; research and development expense of approximately 6 to 8% of net revenues; selling and marketing expense of approximately 6 to 8% of net revenues; general and administrative expense of approximately 8 to 10% of net revenues; and operating margins of approximately 33 to 35% of net revenues.

    Segment Information

                        Three Months Ended         Nine Months Ended
                           December 31,               December 31,
                   ---------------------------- ----------------------
                       2002     2001  Change     2002    2001  Change
Net Revenues
 (in millions)
    Generic Segment   $253.9   $261.3   -3%     $763.8  $724.0    6%
    Brand Segment       66.6     35.9   86%      151.7    97.5   56%
                   ----------  -------          ------- -------
    Total             $320.5   $297.2    8%     $915.5  $821.5   11%

Generic Segment

Net revenues for the third quarter decreased 3% or $7.4 million to $253.9 million from $261.3 million for the same prior year period, primarily as a result of the loss of exclusivity on buspirone. During the prior year third quarter, the Company had market exclusivity with respect to buspirone 15mg and 30mg. Following the expiration of such exclusivity, which occurred in February 2002, buspirone experienced price and volume erosion which is considered normal in the generic industry. Excluding revenue from buspirone, net revenues for the quarter ended December 31, 2002 increased $40.4 million or 19%. The increase was primarily attributable to new products launched subsequent to December 31, 2001, which contributed revenues of $38.0 million.

Gross profit for the quarter decreased $24.2 million to $131.7 million from $155.9 million which was primarily attributable to the decreased gross profit related to buspirone. Earnings from operations were $112.6 million for the quarter compared to $139.2 million for the prior year quarter, a decrease of 19% or $26.6 million. The lower earnings from operations were primarily a result of the lower gross profit along with an increase in research and development expenses. The increase in research and development expense was primarily the result of an increase in clinical studies being performed.

Net revenues for the nine months ended December 31, 2002, increased 6% or $39.8 million to $763.8 million from $724.0 million for the same period in the prior year. This increase in net revenues was realized despite the loss of exclusivity on buspirone. Excluding revenue from buspirone, net revenues for the nine months ended December 31, 2002, increased $145.4 million or 24%, due primarily to new products launched subsequent to December 31, 2001, and increased volume on existing products. New products accounted for $62.2 million, or approximately 43% of the increase in net revenues, with the remaining increase attributable to growth from the Company's existing product portfolio.

Gross profit for the nine months ended December 31, 2002, decreased $14.0 million to $396.1 million from $410.1 million, which was primarily attributable to the decreased gross profit related to buspirone. Earnings from operations for the nine months were $339.7 million compared to $356.5 million for the same prior year period, a decrease of 5% or $16.8 million. The decrease in earnings from operations was driven primarily by the lower gross profit and an increase in research and development expenses, partially offset by lower selling and marketing expenses and general and administrative expenses. The increase in research and development expense was primarily the result of an increase in clinical studies being performed.

Brand Segment

The Brand Segment realized record net revenues for the current quarter of $66.6 million, an increase of 86% or $30.7 million from $35.9 million in the same prior year period. Earnings from operations for the third quarter were $10.7 million compared to $0.1 million for the same prior year period. The launch of Amnesteem accounted for approximately half of the increase in net revenues. The remainder of the increase in net revenues was primarily attributable to three major products, Digitek, phenytoin, and Acticin. As a result of the increase in net revenues, gross profit for the quarter increased $16.4 million or 76% to $37.9 million from $21.5 million. Mylan began marketing Amnesteem in the current quarter under an exclusive three-way supply and distribution agreement with two other companies, to whom royalties are paid.

Brand segment operating expenses increased $5.7 million to $27.1 million from $21.4 million, but decreased as a percentage of revenue to 41% from 60%. Research and development expenses increased $6.5 million, as a result of increased clinical studies related primarily to nebivolol.

For the nine months ended December 31, 2002, the Brand Segment reported net revenues of $151.7 million, an increase of 56% or $54.2 million from $97.5 million in the same prior year period. The increase in net revenues was attributable to growth in the Company's existing portfolio of products, as well as the launch of Amnesteem. Gross profit for the nine months ended December 31, 2002, increased $34.9 million or 66% to $87.8 million from $52.9 million. Earnings from operations for the nine months ended December 31, 2002, were $11.5 million compared to a loss from operations of $16.5 million for the same prior year period.

Brand Segment operating expenses for the nine months ended December 31, 2002, increased 10% or $7.0 million to $76.4 million from $69.4 million. This increase was attributable to higher research and development expenses, as a result of an increase in clinical studies, as well as increased selling and marketing expenses related to the launch of Amnesteem. The increase in research and development expense and selling and marketing expense was partially offset by lower general and administrative expenses. Operating expenses decreased as a percentage of revenue to 50% for the nine months ended December 31, 2002, from 71% for the same prior year period.

Corporate/Other Segment

General and administrative expenses for the current quarter increased $1.3 million to $20.7 million. Other income, net, increased $0.5 million to $3.7 million for the current quarter from $3.2 million for the same prior year period. For the nine months ended December 31, 2002, general and administrative expenses were $48.8 million, a decrease of $7.6 million or 13% from the same period in the prior year. Other income, net, for the nine months ended December 31, 2002, was $7.3 million, a decrease of 62% or $12.1 million from the prior year.

Conference Call and Live Webcast

Mylan will host a conference call and live webcast to discuss its third quarter fiscal 2003 earnings and fiscal 2004 guidance today at 10:00 am EST. The dial-in number to access the live call is [phone]. A replay of the conference call will be available until 12:00 pm EST, February 7, 2003 at [phone], access code 767392. To access the live webcast, please visit Mylan's website at www.mylan.com and click on the webcast icon. A replay of the webcast will be available until 12:00 pm EST, February 7, 2003.

Forward Looking Statements

The statements made in this press release, in filings made with the SEC, on our website, or in other contexts (including statements made by our authorized representatives, either orally or in writing), are or may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which include:

(i) any statement regarding possible or assumed future results of

operations of our business, the markets for our products,

anticipated expenditures, regulatory developments or

competition;

(ii) any statement preceded by, followed by or that includes the

words "intends", "estimates," "believes," "expects,"

"anticipates," "should," "could," or the negative or other

variations of these or similar expressions; and

(iii) other statement regarding matters that are not

historical facts.

Because such statements are subject to risks and uncertainties, actual future results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual future results to differ materially from historic or expected results or that could cause market prices of our common stock to decline include, but are not limited to:

-- our ability to successfully develop, license or otherwise acquire and introduce new products on a timely basis in relation to competing product introductions;

-- our ability to obtain required FDA approvals for new products on a timely basis;

-- uncertainties regarding continued market acceptance of and demand for our products;

-- our periodic dependence on a relatively small group of products as a significant source of our net revenue or net income;

-- the effects of vigorous competition on commercial acceptance of our products and their pricing;

-- the high cost and uncertainty associated with compliance with extensive regulation of the pharmaceutical industry;

-- the significant research and development expenditures we make to develop products, the commercial success of which is uncertain;

-- the possible loss of business from our concentrated customer base;

-- the potential costs and product introduction delays that may result from use of legal, regulatory and legislative strategies by our competitors;

-- our dependence on third party suppliers and distributors for the raw materials, particularly the chemical compound(s) which produces the desired therapeutic effect, the active ingredient we use to manufacture our products;

-- the possible negative effects of any interruption of manufacturing of our generic products at our principal facility;

-- the effects of consolidation of our customer base;

-- uncertainties regarding patent, intellectual and other proprietary property protections;

-- the expending of substantial resources associated with litigation involving patent or other intellectual property protection of competing products;

-- possible reductions in reimbursement rates for pharmaceutical products;

-- our exposure to lawsuits and contingencies associated with our business;

-- our exposure to risks inherent in acquisitions or joint ventures;

-- our ability to attract and retain key personnel;

-- possible adverse effects resulting from any significant decline in the value of securities that we hold or from uninsured losses of funds;

-- uncertainties and matters beyond the control of management, which could affect the Company's earnings guidance, as well as the subjectivity inherent in any probability weighted analysis underlying our assumptions and estimates with respect to the future; and

-- inherent uncertainties involved in the estimates and judgments used in the preparation of financial statements in accordance with GAAP and related standards.

The cautionary statements referred to above should be considered in connection with any subsequent written or oral forward-looking statements that may be made by us or by persons acting on our behalf and in conjunction with our periodic SEC filings. In addition, we refer to the cautionary statements and risk factors mentioned in Item 7 of our Form 10-K for the year ended March 31, 2002, and our most recently filed Form 10-Q. We undertake no duty to update our forward-looking statements, even though our situation may change in the future.

Mylan Laboratories Inc. is a leading pharmaceutical company that develops, manufactures and markets generic and proprietary prescription products. Mylan has two operating segments that market an extensive line of generic and branded products through four business units: Mylan Pharmaceuticals Inc., Mylan Technologies Inc., UDL Laboratories, Inc. and Bertek Pharmaceuticals Inc. For more information about Mylan, visit www.mylan.com.

               MYLAN LABORATORIES INC. AND SUBSIDIARIES
                  Consolidated Statements of Earnings
          (unaudited; in thousands, except per share amounts)


                                Three Months Ended  Nine Months Ended
                                    December 31,       December 31,
                                ------------------ ------------------
                                   2002     2001      2002     2001
                                ------------------ ------------------

Net revenues                    $320,494 $297,191  $915,506 $821,452
Cost of sales                    150,918  119,819   431,596  358,444
                                ------------------ ------------------
Gross profit                     169,576  177,372   483,910  463,008

Operating expenses:
   Research & development         22,941   13,441    59,953   46,687
   Selling & marketing            15,173   15,279    48,598   44,675
   General & administrative (1)   28,769   28,705    73,020   88,122
                                ------------------ ------------------

Earnings from operations         102,693  119,947   302,339  283,524

Other income, net                  4,980    4,879    11,685   22,900
Equity in loss of Somerset        (1,246)  (1,714)   (4,350)  (3,490)
                                ------------------ ------------------


Earnings before income taxes     106,427  123,112   309,674  302,934
Provision for income taxes        37,995   44,936   111,164  109,974
                                ------------------ ------------------


Net earnings                     $68,432  $78,176  $198,510 $192,960
                                ================== ==================



Earnings per common share (2):

   Basic                           $0.37    $0.41     $1.06    $1.03
                                ================== ==================
   Diluted                         $0.37    $0.41     $1.05    $1.01
                                ================== ==================

Weighted average common shares (2):

   Basic                         184,348  188,388   187,107  187,998
                                ================== ==================
   Diluted                       186,594  191,836   189,064  190,801
                                ================== ==================

(1) Due to the April 1, 2002, adoption of Statement of Financial
    Accounting Standard ("SFAS") No. 142, Goodwill and Other
    Intangible Assets, goodwill and certain other intangible assets
    are no longer amortized. General and administrative expenses for
    the three and nine months ended December 31, 2001 include
    amortization expense of $1,801 and $5,403 for goodwill and certain
    other intangibles. Excluding such expense would increase net
    earnings to $79,977 and $198,363 and diluted earnings per share to
    $.42 and $1.04.

(2) Share and per share amounts have been adjusted to reflect a 3 for
    2 stock split which occurred on January 27, 2003.


               MYLAN LABORATORIES INC. AND SUBSIDIARIES
                 Consolidated Condensed Balance Sheets
                       (unaudited; in thousands)


                                                December    March 31,
                                                   31,
                                                     2002        2002
                                               ----------- -----------

  Assets:
  Current assets:
  Cash and cash equivalents                      $253,462    $160,790
  Marketable securities                           454,500     456,266
  Accounts receivable, net                        183,821     150,054
  Inventories                                     214,574     195,074
  Other current assets                            118,917     104,461
                                               ----------- -----------
  Total current assets                          1,225,274   1,066,645
  Non-current assets                              529,154     554,628
                                               ----------- -----------
  Total assets                                 $1,754,428  $1,621,273
                                               =========== ===========

  Liabilities:
  Current liabilities                            $262,735    $177,681
  Non-current liabilities                          39,189      41,353
                                               ----------- -----------
  Total liabilities                               301,924     219,034
  Total shareholders' equity                    1,452,504   1,402,239
                                               ----------- -----------
  Total liabilities and shareholders' equity   $1,754,428  $1,621,273
                                               =========== ===========



               MYLAN LABORATORIES INC. AND SUBSIDIARIES
                            Segment Results
                      (unaudited; in thousands)


                                Three Months Ended  Nine Months Ended
                                      December           December
                                         31,                31,
                                 ------------------ ------------------
                                     2002     2001      2002     2001
                                 ------------------ ------------------

Consolidated
Net revenues                     $320,494 $297,191  $915,506 $821,452
Cost of sales                     150,918  119,819   431,596  358,444
                                 ------------------ ------------------
    Gross profit                  169,576  177,372   483,910  463,008
Research and development           22,941   13,441    59,953   46,687
Selling and marketing              15,173   15,279    48,598   44,675
General and administrative         28,769   28,705    73,020   88,122
                                 ------------------ ------------------
     Earnings from operations    $102,693 $119,947  $302,339 $283,524
                                 ================== ==================

Generic Segment
Net revenues                     $253,888 $261,334  $763,814 $723,973
Cost of sales                     122,164  105,456   367,735  313,859
                                 ------------------ ------------------
    Gross profit                  131,724  155,878   396,079  410,114
Research and development           11,073    8,090    31,960   24,772
Selling and marketing               2,779    3,197     8,078    9,499
General and administrative          5,223    5,362    16,322   19,358
                                 ------------------ ------------------
     Earnings from operations    $112,649 $139,229  $339,719 $356,485
                                 ================== ==================

Brand Segment
Net revenues                      $66,606  $35,857  $151,692  $97,479
Cost of sales                      28,754   14,363    63,861   44,585
                                 ------------------ ------------------
    Gross profit                   37,852   21,494    87,831   52,894
Research and development           11,868    5,351    27,993   21,915
Selling and marketing              12,394   12,082    40,520   35,176
General and administrative          2,848    3,955     7,863   12,312
                                 ------------------ ------------------
         Earnings (loss) from
          operations              $10,742     $106   $11,455 $(16,509)
                                 ================== ==================

Corporate/Other
                                 ------------------ ------------------
General and administrative        $20,698  $19,388   $48,835  $56,452
                                 ================== ==================