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THIRD QUARTER FINANCIAL RESULTS ANNOUNCED BY CYGNUS

 REDWOOD CITY, Calif., Oct. 27 /PRNewswire/ -- Cygnus Therapeutic Systems (NASDAQ: CYGN) reports total revenues of $4.1 million for the quarter ended Sept. 30, 1993, compared to $11.9 million for the third quarter 1992. Cygnus posted a net loss of $2.9 million ($0.21/share) for this quarter, compared to a net loss of $4.5 million ($0.33/share) in the third quarter 1992.
 "During the third quarter, we continued our efforts to finalize partnering transactions and to accelerate the time to market for our products," according to Gregory Lawless, president and chief executive officer of Cygnus. "Our recently announced transaction with Procter & Gamble for a new product in an important consumer market is very promising. We filed an IND in July for a second generation nicotine patch and we expect to file two more IND's for hormone replacement products before the end of the year. Additionally, we expect that Warner-Lambert, our marketing partner, will file a NDA in December or January for our 7-day Estradiol hormone replacement product."
 The difference in revenues between the third quarter 1993 and third quarter 1992 largely reflects introductory shipments of Nicotrol(TM) during this 1992 time period. Contract revenues for third quarter 1993 totaled $2.2 million versus $1 million for the third quarter 1992.
 Costs of products sold were $2.8 million for the third quarter 1993, resulting in a negative product margin. The company experienced negative product margins for the first three quarters of 1993 as lower Nicotrol volumes prevented the company from absorbing the fixed costs associated with Nicotrol manufacturing.
 Research and development expenses were $3.3 million for third quarter 1993 compared to $2.8 million for third quarter 1992. This primarily reflects additional scientists hired to accelerate the time to market for the products in the portfolio.
 Cygnus is a leader in the development of advanced drug delivery systems. The company's primary focus is on the hormone replacement, smoking cessation, glucose monitoring and consumer products markets. Cygnus has more than a dozen products in various stages of development.

 CYGNUS THERAPEUTIC SYSTEMS
 Consolidated Statements of Operations
 (unaudited)
 (In thousands, except per share data)
 Three months ended Nine months ended
 Sept. 30, Sept. 30,
 1993 1992 1993 1992
 Product Sales $ 1,634 $10,967 $ 6,396 $11,405
 Contract revenues 2,171 978 5,039 3,896
 Royalty income 316 --- 1,570 ---
 Total revenues 4,121 11,945 13,005 15,301
 Cost and expenses:
 Costs of products
 sold 2,788 9,724 7,814 12,096
 Research and
 development 3,296 2,793 9,124 11,625
 Marketing, general
 and admin. 1,207 4,335 4,509 8,291
 Total costs and
 expenses 7,291 16,852 21,447 32,012
 Loss from operations (3,170) (4,907) (8,442) (16,711)
 Interest income 377 554 1,082 1,125
 Interest expense (119) (111) (356) (206)
 Net loss $(2,912) $(4,464) $(7,716) $(15,792)
 Net loss per share $ (0.21) $ (0.33) $ (0.56) $ (1.25)
 Shares used in
 computation of net
 loss per share 13,804 13,500 13,734 12,607
 -0- 10/27/93
 /CONTACT: Craig Carlson, vice president, corporate communications, of Cygnus Therapeutic Systems, 415-369-4300/
 (CYGN)


CO: Cygnus Therapeutic Systems ST: California IN: MTC SU: ERN

LW-TM -- SJ008 -- 7539 10/27/93 17:12 EDT
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Date:Oct 27, 1993
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