Profitable nine months ended March 1996 - LANNETT COMPANY ANNOUNCES PROFITABLE THIRD QUARTER FISCAL 1996.

PHILADELPHIA--(BUSINESS WIRE)--June 21, 1996--LANNETT COMPANY, INC. (OTC) ("LANN"), a manufacturer and distributor of pharmaceutical products, today reported a profit for Third Quarter Fiscal 1996. This extends a continuous profitable quarterly trend throughout Fiscal Year 1996.

Net sales for the Third Quarter Fiscal 1996, ended March 31, 1996, were $879,508, compared to $896,968 for the Third Quarter Fiscal 1995, ended March 31, 1995. The Company also reported net income of $41,316 for the Third Quarter Fiscal 1996, compared to net income of $47,732 during the same period in Fiscal 1995. On a per share basis, this represents Third Quarter Fiscal 1996 income of $0.01 per share, compared to $0.01 per share, for Third Quarter Fiscal 1995.

Net sales for the nine months ended March 31, 1996, were $2,738,197 compared to net sales of $3,456,089 for the same period in Fiscal 1995. A decrease in contract manufacturing and increased competition for one of the Company's products resulted in a decrease in sales for the nine months ended March 31, 1996 compared to the nine months ended March 31, 1995. Net income during the nine months ended March 31, 1996 was $185,439, or $0.04 per share, $0.02 on a fully diluted basis: net income during the same period during Fiscal 1995 was $536,659, or $0.10 per share, $0.05 on a fully diluted basis.

William Farber, Chairman of the Board of Directors, stated "an extensive Research and Development program has been developed and resources have been dedicated to support the growth of Lannett. As a part of this effort and subsequent to the close of the third quarter, the Company reintroduced to the market, Prednisone Tablets in 20 mg dosage strength. Prednisone is a steroidal antiinflammatory agent. In addition, the Company received an `AB' rating for Dicyclomine Hydrochloride USP, 10 mg capsules, the Company's largest product, making it fully interchangeable with Marion Merrell Dow's Bentyl(R) and fully reimbursable under Federal Government programs."

As of March 31, 1996, prior to the reintroduction of Prednisone Tablets USP, 20 mg, three generic drug products were manufactured and marketed by the Company: Primidone, a generic version of Wyeth Ayerst's Mysoline(R), an anticonvulsant; Butalbital Compound Capsules ("BCC"), a generic version of Sandoz's Fiorinal(R); and Dicyclomine Hydrochloride USP, 10 mg Capsules ("Dicyclomine"), a generic version of Bentyl(R) from Marion Merrell Dow. Sixteen additional products are under development; four of these products have been revalidated and submitted to the FDA for supplemental approval, and ten others are currently in various stages of development, revalidation or preparation for submission to the agency. Research and Development projects also encompass two new product introductions as part of the Company's commitment to a strong research and development program.

Lannett is a reemerging generic pharmaceutical company dedicated to excellence. In its newly renovated facility, Lannett has added modern manufacturing and analytical equipment, and implemented new systems and controls, facilitating compliance with current Good Manufacturing Practices (cGMP). Staffed by highly qualified work force and management teams, Lannett intends to reintroduce a number of ANDA products in the future.

CONTACT: Jeffrey M. Moshal

Vice President - Finance

LANNETT COMPANY

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