TELOR OPHTHALMIC PHARMACEUTICALS, INC. ANNOUNCES FIRST QUARTER RESULTS; Provides Update on Drug Research and Development Programs.

WILMINGTON, Mass.--(BUSINESS WIRE)--June 8, 1995--Telor Ophthalmic Pharmaceuticals, Inc. (Nasdaq: TELR) today announced the financial results of operations for the first quarter of 1995. The Company also reported on the status of its drug research and development programs.

For the first quarter of 1995, the Company reported a loss of $1,720,000, or $0.22 per share, compared to a net loss of $2,381,000, or $0.31 per share, in the first quarter of 1994. Research and development expenses for the quarter were $1,458,000, compared to $2,045,000 for the same period last year. Expenditures for the pivotal Phase III clinical trials for XARANO(TM) were lower than in the first quarter of 1994, reflecting the later stage of the trials in 1995. The Company's refocus of resources on potential products that are further along the development cycle, including 1994 development expenses for programs that were not continued in 1995, significantly eased the research and development expenditure rate. Finally, savings related to a reorganization the Company announced in November 1994 also contributed to the year-over-year decline in expenditures.

On March 31, 1995, the Company had approximately $9.1 million in cash and short-term investments. Following the November 1994 reorganization and workforce reduction, the Company had 31 employees on March 31, 1995, as compared to 43 on March 31, 1994.

Drug Development Update

The Company recently completed the planned patient enrollment for its Phase III double-masked, multi-center trials to investigate the safety and clinical efficacy of XARANO, Telor's lead drug candidate. XARANO is an intracameral formulation of ethacrynate sodium under development that is designed to prevent or attenuate the elevated intraocular pressure spike often associated with cataract surgery, particularly in patients with glaucoma. Pending the results from these studies, Telor will determine whether to proceed with a new drug application for XARANO.

In the area of ocular pain management, Telor has identified two classes of compounds to evaluate for possible effectiveness. In a recently completed feasibility study, one of these classes related to technology licensed in early 1994 did not result in a significant response when applied topically. Based on that result, the Company has decided not to proceed with further testing of that class of compounds. The Company is considering whether to proceed with licensing and a feasibility study on the second class of compounds.

"We are pleased to have completed enrollment in our Phase III clinical trials of XARANO and expect to complete the trials in the second half of this year," said John K. Herdklotz, Ph.D., Chairman of the Board and acting Chief Executive Officer of Telor. "The Company's reorganization in 1994 has allowed us to concentrate on reaching this milestone as well as on advancing our ongoing Phase I/II clinical program to study a potential pharmaceutical product to maximize pupil size during cataract surgery."

Telor Ophthalmic Pharmaceuticals, Inc., a development stage company, is dedicated to the development and commercialization of innovative prescription pharmaceuticals for use in ophthalmic surgery and age-related eye diseases. The Company's strategy is to introduce a broad-based portfolio of patented products into the expanding $3.6 billion worldwide ophthalmic market.

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                TELOR OPHTHALMIC PHARMACEUTICALS, INC.
                   (A Development Stage Company)

                 CONDENSED STATEMENTS OF OPERATIONS
                           (Unaudited)

                                         Three Months Ended March 31,
                                           1995                1994

Revenues                                 $   --                 $   --

Operating expenses:
   Research and development        $   1,458,264         $   2,045,393
   General and administrative            405,335               435,442
   Marketing                                  --                52,253
   Restructuring charges                      --                    --
   Less interest income, net             143,328               151,898
      Total operating expenses     $   1,720,271         $   2,381,190

Net loss per common share             $    (0.22)        $       (0.31)

Weighted average shares outstanding    7,741,626             7,627,952

                            BALANCE SHEET DATA
                               (Unaudited)

                                       March 31,           December 31,
                                         1995                 1994

Cash and short-term investments    $   9,098,949        $   10,945,177
Fixed assets, less depreciation        1,964,786             2,038,718
   Total assets                       11,772,163            13,677,903
Total current liabilities                866,727             1,110,005
Total long term obligations              556,948               567,822
Total stockholders' equity        $   10,348,488        $   12,000,076

CONTACT: John K. Herdklotz, Ph.D.

Chairman and Acting Chief Executive Officer

Telor Ophthalmic Pharmaceuticals, Inc.

508/657-8400

or

John. M. Nugent (Investor Inquiries)

James W. Heins (Media Inquiries)

Burns McClellan, Inc.

212/505-1919