NeoPharm, Inc. is a biopharmaceutical company engaged in the research, development and commercialization of drugs for the treatment of various cancers. The Company currently has a portfolio of eight anti-cancer drugs, six of which are in clinical trials. 

NEOPHARM, Inc. Announces Third Quarter 2007 Financial Results 
    Restructuring Complete and Drug Pipeline Progress on Schedule
WAUKEGAN, Ill.--(BUSINESS WIRE)--Nov. 8, 2007--NEOPHARM, Inc. (NASDAQ: NEOL), today announced its third quarter 2007 financial results.

For the third quarter ended September 30, 2007, NEOPHARM reported a net loss of $881,000, or ($0.03) per basic and diluted share, as compared to a loss of $8.0 million, or ($0.29) per share, for the same period last year. The net loss for the quarter includes a one-time credit of other income of $2.0 million, or $0.07 per diluted share, related to the termination of the Nippon-Kayaku contract. Adjusting for this one-time credit, the loss for the third quarter would have been $2.9 million, or ($0.10) per share, which represents a 64% reduction year-over-year.

Sequentially, the net loss for the third quarter, absent the one-time credit related to Nippon-Kayaku, favorably compared to the $3.6 million net loss incurred in the second quarter ending June 30, 2007, representing a reduction of $734,000, or 20%.

For the nine months ended September 30, 2007, NEOPHARM reported a net loss of $9.9 million, or ($0.35) per basic and diluted share, which includes the one-time credit related to the Nippon-Kayaku contract, as compared to a loss of $25.5 million, or ($0.92) per share, for the same period last year.

The decline in the Company's net loss can be primarily attributed to the aggressive cost reduction initiatives in both personnel and non-personnel related expenses as a result of the Company's restructuring efforts to optimize its drug development activities. Based on the progress to date, NEOPHARM believes that most of its restructuring initiatives are now complete.

"During the quarter, we continued to remain focused on achieving an optimal cost structure, while concurrently taking the necessary steps to reach the targets we announced in August of this year. The significant reduction in our cash consumption level clearly reflects our on-going commitment to driving value from our drug portfolio while utilizing the resources we currently have available," commented Laurence Birch, President and Chief Executive Officer of NEOPHARM. "I believe that the intellectual property NEOPHARM has developed to date, as well as the additional indications that may be developed in the future with our current compounds, have the ability to propel the Company to the next phase of its business life cycle. While I recognize that there is a lot of work ahead of us, I am confident that the team we have in place has the ability and experience to progress a number of our drug candidates to the next stage of development."

During the quarter, the Company allocated $2.2 million in cash to its operations versus $3.1 million in the second quarter, which represents a decrease of 29%. While NEOPHARM anticipates future cash consumption levels to be in-line with spending during the third quarter, obligations related to previous drug product candidates' trials are likely to be incurred in the coming quarters. Despite these anticipated disbursements, with $23.5 million in cash and available for sale securities at the end of the third quarter, the Company reaffirmed its estimate that it has adequate resources to fund its operations into 2009.