BDSIW Biodelivery Sciences International (MM)

BDSI Reports Financial Results for the Third Quarter Ended September 30, 2004 Increase in Stockholders' Equity Meets Nasdaq Requirements for Continued Listing NEWARK, N.J., Nov. 12 /PRNewswire-FirstCall/ -- BioDelivery Sciences International, Inc. (NASDAQ:BDSICNASDAQ:BDSIW) today reported financial results for its fiscal quarter ended September 30, 2004 by filing its Quarterly Report on Form 10-QSB with the Securities and Exchange Commission. For the third quarter of fiscal 2004, BDSI reported total revenue of approximately $665,000, compared to revenue of approximately $780,000 for the same period in fiscal 2003. However, BDSI reported its first quarterly profit, slightly in excess of $1 million, or $0.14 per share, due in part to a one-time $2.5 million asset sale (consisting of a future royalty revenue stream) to Accentia Biopharmaceuticals, Inc., a related company. Net loss for the third quarter of 2003 was approximately $500,000, or ($0.07) per share. BDSI also reported total stockholders' equity of approximately $7.24 million as of the quarter ended September 30, 2004, compared to approximately $3.14 million as of the year ended December 31, 2003 and approximately $768,000 for the quarterly period ended June 30, 2004. This increase was due to BDSI's consummation of several strategic transactions in the third quarter of 2004, including: (i) the acquisition of Arius Pharmaceuticals, Inc. (and the issuance of a newly-created series of Series A Preferred Stock in connection therewith), (ii) the entry into a $4 million Equity Line of Credit Agreement with Hopkins Capital Group II, LLC, BDSI's principal stockholder (and the issuance of $1.45 million of a newly-created series of Series A Preferred Stock in connection therewith) and (iii) cost-cutting efforts by the company. Additionally, as of September 30, 2004, BDSI had cash on hand of approximately $2.14 million, compared to approximately $526,000 as of the year ended December 31, 2003 and approximately $143,000 for the quarterly period ended June 30, 2004. The increase in stockholders' equity is particularly important as the reported level of stockholders' equity will allow BDSI to meet the requirements for continued listing on the Nasdaq SmallCap Market. BDSI has been threatened with delisting from such market because stockholders' equity was below $2.5 million as of March 31, 2004 and because of certain other matters. A Nasdaq hearing was held on September 9, 2004 and on October 13, a hearing panel of the Nasdaq Stock Market informed BDSI that it had been granted a exception to such deficiencies pending the announcement of the company's third quarter financial results. BDSI plans to report its financial results to the Nasdaq Hearings Department immediately and is hopeful that the exception will be lifted and that BDSI's stock will return to normal trading status. Dr. Frank O'Donnell, Chairman, CEO and President of BDSI, stated, "We are very gratified by our third quarter results and are proud of the hard work BDSI has put in to achieve this outcome. We expect, barring any unforeseen matters, to return to normal trading status on the Nasdaq as soon as possible." BioDelivery Sciences International, Inc. is a biotechnology company that is developing and seeking to commercialize patented and licensed delivery technologies for pharmaceuticals, vaccines, over-the-counter drugs, nutraceuticals and micronutrients. The company's technologies include: (i) the patented Bioral(TM) nanocochleate technology, designed for a potentially broad base of applications, and (ii) the patented BEMA(TM) (buccal or mouth) drug delivery technology being developed by the company's Arius Pharmaceuticals subsidiary with a focus on "acute" treatment opportunities for surgical and oncology patients. Note: Except for the historical information contained herein, this press release contains, among other things, certain forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, that involve risks and uncertainties. Such statement may include, without limitation, statements with respect to the Company's plans, objectives, expectations and intentions and other statements identified by words such as "may", "could", "would", "should", "believes", "expects", "anticipates", "estimates", "intends", "plans" or similar expressions. These statements are based upon the current beliefs and expectations of the Company's management and are subject to significant risks and uncertainties, including those detailed in the Company's filings with the Securities and Exchange Commission. Actual results may differ from those set forth in the forward-looking statements. These forward-looking statements involve certain risks and uncertainties that are subject to change based on various factors (many of which are beyond the Company's control). L.G. Zangani, LLC provides financial public relations service to the Company. As such L.G. Zangani, LLC and/or its officers, agents and employees, receives remuneration for public relations and or other services in the form of monies, capital stock in the Company, warrants or options to purchase capital in the Company. DATASOURCE: BioDelivery Sciences International, Inc. CONTACT: Francis E. O'Donnell, Jr., President and CEO of BioDelivery Sciences International, Inc., +1-973-972-0015; or M.DLeonardo Zangani of L.G. Zangani, LLC, +1-908-788-9660 Web site: http://www.biodeliverysciences.com/

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