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 KENILWORTH, N.J., April 27 /PRNewswire/ -- "For Schering-Plough, 1992 was another year of strong performance; for the first time in our history, sales topped $4 billion and -- for the seventh consecutive year -- earnings per share increased at a rate of 20 percent or more," Robert P. Luciano, chairman and chief executive officer, told shareholders at the annual meeting here today.
 In his address, Luciano reviewed the company's 1992 business performance and outlined Schering-Plough's (NYSE: SGP) perspective on the current U.S. health care debate and the pharmaceutical industry's role in health care reform.
 Luciano said that, concurrent with generating strong financial results, the company also is operating more efficiently. "The higher operating levels achieved by Schering-Plough have translated directly to the bottom line," he said, "providing the resources to fund research and capital investments, make acquisitions and reward our shareholders."
 He noted that since 1986 the company has declared two stock splits and 10 dividend increases, including a 15 percent increase in the current quarterly dividend -- from 39 to 45 cents per share -- announced earlier in the day.
 "This superior performance is possible because our two business units -- Schering-Plough Pharmaceuticals and Schering-Plough HealthCare Products -- are aggressively targeting their markets, meeting changes in the business environment effectively and operating efficiently."
 Luciano noted that Schering-Plough Pharmaceuticals is achieving strong growth as a broad-based, resilient worldwide competitor. Sales of the business unit totaled $3.36 billion in 1992, representing more than 80 percent of total company sales.
 The asthma and allergy category is Schering-Plough's largest product group, with worldwide sales topping $1 billion in 1992. Leading sales growth in this category is CLARITIN, a non-sedating antihistamine that gained U.S. approval April 12. The product is sold in 70 countries -- in 13 as an over-the-counter (OTC) product.
 "Now that we have Food and Drug Administration (FDA) approval of CLARITIN," said Luciano, "L line of asthma therapies is maintaining its leading position in the U.S. respiratory market, even as three formulations -- tablet, solution and syrup -- have been subject to generic competition. VANCERIL, an oral inhaled steroid, recorded higher sales in 1992, while sales of the VANCENASE line of nasal steroid allergy products benefited from the 1992 launch of VANCENASE Pockethaler, an improved aerosol nasal inhaler.
 Sales growth in the cancer and infectious disease product group was driven primarily by strong gains of the antiviral and anticancer agent INTRON A -- especially in Japan where it was approved in March 1992 as a treatment for hepatitis C. INTRON A is marketed in 59 countries for a total of 16 indications.
 Worldwide sales of EULEXIN, an oral treatment for advanced prostate cancer, also increased significantly, due to physician acceptance of combined hormonal blockade as the standard for treating metastatic prostate cancer. A highly promising addition to the company's successful line of antibiotic products is CEDAX, a third-generation cephalosporin approved in eight countries and under U.S. review.
 Reviewing Schering-Plough HealthCare Products, Luciano said, "Although sales in 1992 declined a bit compared with 1991 -- when they were boosted by the very successful OTC launch of the vaginal antifungal GYNE-LOTRIMIN -- we are confident that HealthCare Products today is poised to resume its strong growth as the U.S. economy pulls out of its recession."
 With its leading OTC brands, the business is well positioned to capitalize on opportunities created by changing demographics and consumer trends, he said. In the foot care market, Schering-Plough is the leading company in North America, with the DR. SCHOLL'S line of foot care products and two formerly prescription products, LOTRIMIN AF and TINACTIN, which hold the top two market positions among topical antifungals.
 Led by the COPPERTONE line of sun care products, the company remained No. 1 in every segment of the U.S. sun care market, strengthening its position with the addition of SHADE UVAGUARD, a broad- spectrum sunscreen offering skin protection against the damaging effects of the sun's UVA and UVB rays.
 "The success that HealthCare Products and Schering-Plough Pharmaceuticals have achieved is due to our ability to identify the right markets, move quickly and operate efficiently," said Luciano.
 Schering-Plough also has made a strategic commitment to pharmaceutical research. In 1992, the company invested $521 million in R&D, an increase of 22 percent over 1991, and expects to invest nearly $600 million this year.
 Illustrating Schering-Plough's commitment to research is its new Drug Discovery Facility (DDF), a one-million-square-foot building with state-of-the-art laboratories on the company's Kenilworth, N.J., campus. Luciano expressed confidence that the new drugs to be discovered within DDF's laboratories "can make an important contribution to alleviating the health care problems facing this country and to improving the quality of life for people throughout the world."
 Addressing health care reform, he emphasized the "integral role that prescription pharmaceuticals play in any solution to the health care dilemma. Not only do prescription drugs save lives and improve patients' well-being, they are also highly cost-effective." He noted that today's pharmaceuticals frequently are displacing many higher- priced alternative treatments such as surgery, hospitalization and long- term care.
 "Drugs avoid surgeries that were mandatory just a few years ago," he continued, "while making once-impossible surgical procedures standard practice. As for the future, drugs in development today will someday provide cures for such intractable and costly diseases as the various cancers, arthritis, Alzheimer's, and coronary heart and cerebrovascular disease."
 Luciano pointed out that discovering and developing new pharmaceuticals is a very high-risk proposition. He called it one of the few enterprises where one can spend more than $100 million on a new product, only to have it fail in the final stages of development and never make back one cent of its cost. He cited an estimate that only one in 5,000 compounds actually makes it to market -- and that journey can take 12 years and cost about a quarter billion dollars.
 Given these odds, shareholders should be rewarded for the risks they allow companies like Schering-Plough to take in the pursuit of new medicines. "We also believe that the system of free-market incentives has worked for the benefit of all concerned, when one considers that nine out of 10 new drugs have been developed by private industry -- not the government."
 Luciano said Schering-Plough is firmly committed to helping ensure patient access to necessary medicines at affordable prices. The company held average U.S. net prescription price increases to 2 percent -- below the increase in the Consumer Price Index -- in both 1991 and 1992. "Moreover, we expect average price increases to be below the CPI once again this year -- and for those patients who can't afford our life- saving products," he added, "they are available free of charge."
 He said industry critics may find a receptive audience because many Americans who have health care insurance are "covered" for doctor visits and hospital procedures, but not for outpatient prescriptions. "Small wonder, then, that a $100 out-of-pocket prescription expense is onerous -- but not a $6,000 hospital stay that is completely covered -- that's the average U.S. hospital bill." To remedy this inequity, he said the company supports an outpatient drug benefit plan as an essential component in any health care reform package.
 "We do not support mandatory government price controls or national pricing boards for the simple reason that, historically, they don't work and they divert precious resources from meaningful drug research," added Luciano. He said the company is also opposed to a "global budget" system whereby the government would set an annual spending limit for all health care providers.
 Luciano pointed out that pharmaceuticals represent only 7 cents of every U.S. health care dollar -- a ratio that has steadily declined since 1965, when it was more than 12 cents. U.S. spending on pharmaceuticals has remained at about one-half of 1 percent of the nation's Gross National Product since 1965 -- even as total health care spending has burgeoned from 6 percent to around 14 percent of GNP, he added.
 "Pharmaceuticals are not part of the health care problem in this country -- they are, as anyone interested in facts knows, a part of the solution," he emphasized. "The tiny pharmaceutical tablets we produce -- huge in intellectual content and therapeutic effect -- bring immense value to all of mankind."
 In other business at the annual meeting, shareholders elected Hans W. Becherer, Regina E. Herzlinger, James Wood and Robert van Oordt for three-year terms on the board of directors and ratified the designation of Deloitte & Touche as auditors for 1993.
 Schering-Plough is a research-based company engaged in the research, development, manufacturing and marketing of pharmaceutical and health care products worldwide.
 -0- 4/27/93
 /CONTACT: Steve Galpin Jr. of Schering-Plough, 201-822-7415/

CO: Schering-Plough ST: New Jersey IN: MTC SU:

SH -- NY094 -- 1494 04/27/93 14:57 EDT
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Date:Apr 27, 1993

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