Noven Announces Record Financial Results

Net Income Up 193% Over 1999 Third Quarter

Quarterly Revenues Increase 38% Over Prior Year Period

-- Noven Pharmaceuticals, Inc. (NASDAQ: NOVN) today announced record financial results for the quarter and nine-month period ended September 30, 2000.

For the quarter, Noven reported net income of $3.6 million, or diluted earnings of $.15 per share, compared to $1.2 million, or diluted earnings of $.06 per share, for the third quarter of 1999. Revenues were $11.2 million, compared to $8.1 million for the same quarter in 1999. Noven increased its research and development spending in the third quarter to $3.3 million from $1.6 million in the third quarter of 1999, most of which related to clinical trials for Noven's MethyPatch™ transdermal methylphenidate delivery system for Attention Deficit Hyperactivity Disorder, which is in Phase III clinical trials.

For the first nine months of 2000, Noven reported net income of $8.9 million, or diluted earnings of $.39 per share, compared to $2.9 million, or diluted earnings of $.13 per share, for the first nine months of 1999. Revenues were $31.2 million compared to $23.0 million for the same period in 1999. Research and development expense for the first nine months of 2000 was $8.7 million, compared to $4.7 million in the same period in 1999.

Novogyne Pharmaceuticals, Noven's women's health joint venture with Novartis, contributed $2.7 million and $6.4 million to Noven's third quarter and first nine months financial results, respectively, which amounts are reported as "Equity in earnings of Novogyne" on Noven's Statements of Operations. Novogyne did not contribute to Noven's financial results during the first nine months of 1999.

As of September 30, 2000, Noven's cash and cash equivalents were $20.8 million, compared to $15.3 million as of December 31, 1999.

"We are pleased to have delivered record financial results for the third quarter, while significantly advancing critical corporate and clinical objectives," said Robert C. Strauss, Noven's President, CEO and Co-Chairman.

"On the corporate front, Noven is proceeding towards the international license of Vivelle-Dot™, the world's smallest estrogen replacement patch. We believe we may be in a position to announce such a license in the near-term. In addition, Novartis has now launched Estalis®, our combination estrogen/progestin transdermal delivery system, in 15 countries, with more to follow. The distribution of both Vivelle-Dot and Estalis abroad should provide Noven with meaningful international revenue growth in 2001 and beyond."

"On the clinical front, Phase III clinical trials for MethyPatch, our transdermal methylphenidate patch for Attention Deficit Hyperactivity Disorder, are in progress, and we have almost completed full enrollment. MethyPatch, if approved, could greatly accelerate Noven's growth. Accordingly, we are investing heavily in R&D to optimize its chances for approval. We expect to increase R&D spending in the 2000 fourth quarter by a little more than 50% over the $3.3 million that we invested in the third quarter. A major component of this amount relates to MethyPatch clinical trials. Thereafter, with MethyPatch clinicals substantially completed, our R&D spending should return to more normal levels. We are working hard to file our New Drug Application for this product in the first quarter of 2001."

A telephone conference among management and equity analysts relating to Noven's financial results will be broadcast live via the Internet at beginning at 5:00 p.m. Eastern time today, November 1. Thereafter, a rebroadcast of the call will be accessible at the same site. In addition, a taped replay of the conference call will be available by telephone beginning today at 7:00 p.m. Eastern Time to November 3 at 11:59 p.m. by calling 800-475-6701 (from within the U.S.) or 320-365-3844 (from outside the U.S.) and entering the access code 546035.

Noven Pharmaceuticals, Inc., headquartered in Miami, Fla., is a leader in the development of transdermal and transmucosal drug delivery systems and technologies. Noven has developed and presently manufactures a series of leading-edge products, including the world's smallest estrogen transdermal delivery system, the United States' only combination estrogen/progestin transdermal delivery system, and the first transmucosal patch approved for marketing by the U.S. Food and Drug Administration. With a wide range of additional products in development, Noven is committed to becoming the world's premier developer, manufacturer, and marketer of transdermal and transmucosal drug delivery systems. For additional information on Noven, visit For information on Noven's Vivelle® and Vivelle-Dot™ products, visit

Forward looking statements contained in this release are qualified by and subject to the risks and uncertainties specified below and those specified by Noven in its most recent filings with the Securities and Exchange Commission, including the risks that Novogyne's results for full-year 2000 may be less than anticipated, that Noven may not enter into an international Vivelle-Dot license in the near term or at all, that launches of Noven's products outside the U.S. may be delayed and that therefore international revenue growth may be lower than anticipated, that research and development spending may be higher than expected, that the Phase III trials for MethyPatch may be unsuccessful, that products in research and development, including MethyPatch, may not reach market in a timely fashion or at all, and that competition in Noven's markets could negatively impact Noven's sales and earnings.

                      Noven Pharmaceuticals, Inc.

Statement of Operations      Three Months Ended     Nine Months Ended
Data:(amounts in thousands,    September 30,           September 30,
 except per share amounts)    2000      1999           2000     1999

                         (Unaudited)(Unaudited) (Unaudited)(Unaudited)
  Product sales          $ 11,016   $ 8,004      $ 30,807    $ 22,861
  License revenue             147        56           440         169
  Total revenues           11,163     8,060        31,247      23,030
  Cost of products sold     4,928     3,464        13,951      10,069
  Research and development  3,307     1,585         8,687       4,727
  Marketing, general
   and administrative       1,980     1,800         6,369       5,446
  Total operating costs
   and expenses            10,215     6,849        29,007      20,242
Income from operations        948     1,211         2,240       2,788
Equity in earnings
 of Novogyne                2,653         -         6,383           -
Interest income, net          306        78           773         193
Income before income taxes  3,907     1,289         9,396       2,981
Provision for income taxes    282        50           470          68
Net income                $ 3,625   $ 1,239       $ 8,926     $ 2,913
Basic earnings
 per share                 $ 0.16    $ 0.06        $ 0.41      $ 0.14
Diluted earnings
 per share                 $ 0.15    $ 0.06        $ 0.39      $ 0.13
Weighted average number of
 common shares outstanding:
        Basic              22,042    21,511        21,841      21,501
        Diluted            23,586    21,783        23,104      21,673

                                                As of
                                   September 30,       December 31,
 Balance Sheet Data:                  2000                1999
                                   (Unaudited)          (Audited)
     Cash and cash equivalents       $ 20,800           $ 15,338
     Working capital                 $ 24,547           $ 16,581
     Property, plant and
      equipment, net                 $ 15,402           $ 15,329
     Investment in Novogyne          $ 12,520           $  8,365
     Total assets                    $ 70,539           $ 56,888
     Deferred license revenue        $  7,588           $  8,028
     Shareholders' equity            $ 52,173           $ 39,393

James B. Messiry
Chief Financial Officer