Ipsen's First Nine Months of 2008 Sales and Update of Group Financial Objectives - Part II of II

• Continued strength: +10.9% performance ⁽¹⁾ sales growth, +7.0% reported ⁽²⁾
• Acceleration of growth in speciality care, gaining market share: +14.3%
• Sustained growth in international markets: +19.5%
• Group financial objectives updated, post US acquisitions

Ipsen’s First Nine Months of 2008 Sales and Update of Group Financial Objectives - Part II of II

Continued - Part II of II

Comparison of consolidated sales for the third quarter and first nine months of 2008 and 2007:

Sales by geographical region

Group sales by geographical region for the third quarter and first nine months of 2008 and 2007 were as follows:

		Third quarter						Nine months
(in thousand euros)		2008		2007		% change		2008		2007		% change
France		75,773		81,190		(6.7%)		234,524		253,628		(7.5%)
Spain		14,421		13,189		9.3%		44,176		41,279		7.0%
Italy		16,514		15,301		7.9%		53,184		49,416		7.6%
Germany		13,367		13,479		(0.8%)		43,380		36,597		18.5%
United Kingdom		10,980		10,432		5.3%		32,359		30,539		6.0%
Major Western European countries		133,327		135,938		(1.9%)		414,543		418,960		(1.1%)
Other European countries		60,684		51,625		17.5%		185,261		157,715		17.5%
Asia		22,711		19,182		18.4%		68,856		60,298		14.2%
North America		2,130				na		4,188		na		na
Other countries in the rest of the world		18,864		17,323		8.9%		62,236		50,307		23.7%
Rest of the world		43,704		36,505		19.7%		135,281		110,556		22.4%
Group Sales		237,714		224,067		6.1%		735,086		687,231		7.0%

For the third quarter 2008, sales generated in the Major Western European countries amounted to €133.3 million, down 1.9% year-on-year (third quarter 2007, €135.9 million). For the first nine months 2008, sales generated in the Major Western European countries amounted to €414.5 million, down 1.1% year-on-year (first nine months 2007, €419.0 million). Excluding the sales of Ginkor Fort ^® , sales in this region were up 3.2% year-on-year, fuelled by strong sales in Germany, Italy and Spain. This good performance was offset by negative foreign exchange impacts in the United Kingdom (where growth in local currency reached 19.5%) and by a decrease in Tanakan ^® sales in France following a 10% price cut implemented on July 1, 2007 in an increased competitive environment. Sales in this region in the first nine months 2008 represented 56.4% of total sales compared with 61.0% a year earlier.

France – For the third quarter 2008, sales reached €75.8 million, down 6.7% year-on-year (third quarter 2007, €81.2 million). For the first nine months of 2008, sales reached €234.5 million, down 7.5% year-on-year (first nine months of 2007, €253.6 million), driven by the good performances notably of Nisis® & Nisisco®, Somatuline® and Forlax®. This good performance was more than offset by the divestment of Ginkor Fort® for France, Monaco and Andorra as of 1 January 2008 as well as by the price cut on Tanakan®. The weight of France in the Group’s consolidated sales continued to decline, representing 32.8% of total Group sales against 38.0% a year earlier.

Spain – For the third quarter 2008, sales reached €14.4 million, up 9.3% year-on-year (third quarter 2007, €13.2 million). For the first nine months 2008, sales reached €44.2 million, up 7.0% year-on-year (first nine months 2007, €41.3 million) fuelled by strong sales growth notably of Somatuline®, and NutropinAq® despite an increased competitive environment for Decapeptyl®. The weight of Spain in the Group’s consolidated sales remained stable year-on-year, at 6.0% of total Group sales.

Italy – For the third quarter 2008, sales reached €16.5 million, up 7.9% year-on-year (third quarter 2007, €15.3 million), thanks to the strong growth of Somatuline® and NutropinAq®. For the first nine months of 2008, sales reached €53.2 million, up 7.6% year-on-year (first nine months of 2007, €49.4 million) fuelled by strong sales of NutropinAq® and Somatuline®.

Germany – For the third quarter 2008, sales reached €13.4 million, down 0.8% year-on-year (third quarter 2007, €13.5 million), due to drug-related sales (active ingredients and raw materials) down 27.7% year-on-year influenced by stock building during the previous quarter and despite the strong growth of Somatuline®, almost doubling sales year-on-year, as well as the double-digit growth of Decapeptyl®. For the first nine months of 2008, sales reached €43.4 million, up 18.5% year-on-year (first nine months of 2007, €36.6 million) fuelled by strong sales of Decapeptyl®, Somatuline®, Dysport® and Increlex® despite a slowdown of Forlax®. The weight of Germany in the Group’s consolidated sales represented 5.9% of total Group sales against 5.3% a year earlier.

United Kingdom – For the third quarter 2008, sales reached €11.0 million, up 5.3% year-on-year (third quarter 2007, €10.4 million) with all specialty products displaying solid volume growth, partly offset by a negative foreign exchange impact. Therefore, at constant currency sales in the United Kingdom grew by 20.2% year-on-year. For the first nine months of 2008, sales reached €32.4 million, up 6.0% year-on-year (first nine months of 2007, €30.5 million) or 19.5% in local currency, fuelled by strong sales of Decapeptyl®, Dysport® and NutropinAq®.

For the third quarter 2008, sales generated in the Other European countries reached €60.7 million, up 17.5% year-on-year (third quarter 2007, €51.6 million). For the first nine months of 2008, sales reached €185.3 million, up 17.5% (first nine months of 2007, €157.7 million) mainly driven by strong growth of Dysport ^® in Russia and Greece, as well as Tanakan ^® in Russia and Eastern European countries, Somatuline ^® in Netherlands, Nordic countries and Belgium and Decapeptyl ^® in Russia. Over the same period, sales in this region represented 25.2% of total consolidated Group sales, against 22.9% a year earlier.

For the third quarter 2008, sales generated in the Rest of the World reached €43.7 million, up 19.7% year-on-year (third quarter 2007, €36.5 million). For the first nine months of 2008, sales reached €135.3 million, up 22.4% (first nine months of 2007, €110.6 million) thanks to the volume growth of Decapeptyl ^® in China and Algeria, Dysport ^® in Brazil, Somatuline ^® in the United States and Australia and Smecta ^® in Algeria. Sales in the Rest of the World represented 18.4% of total consolidated Group sales, against 16.1% a year earlier.

Sales by therapeutic area and by product

The following table shows sales by products, grouped together by therapeutic areas for the third quarter and first nine months of 2008 and 2007:

				Third quarter						Nine months
(in thousand euros)				2008		2007		% change		2008		2007		% change
Oncology				64,328		56,204		14.5%		190,010		174,406		8.9%
of which		Decapeptyl ® (1)		64,325		56,200		14.5%		190,003		174,385		9.0%
Endocrinology				38,962		31,613		23.2%		115,382		95,140		21.3%
of which		Somatuline ® (1)		30,543		25,015		22.1%		89,950		75,839		18.6%
		NutropinAq ® (1)		7,407		6,028		22.9%		22,621		17,565		28.8%
		Increlex ® (1)		509		3		na		1,182		3		na
Neuromuscular disorders				35,943		32,128		11.9%		111,914		95,695		16.9%
of which		Apokyn ® (1)		1,440				na		1,440				na
		Dysport ® (1)		34,503		32,128		7.4%		110,474		95,695		15.4%
Specialist Care				139,233		119,944		16.1%		417,306		365,240		14.3%
Gastroenterology				43,202		43,952		(1.7%)		138,888		130,703		6.3%
of which		Smecta ®		21,124		22,970		(8.0%)		71,518		67,989		5.2%
		Forlax ®		12,940		13,301		(2.7%)		39,844		38,618		3.2%
Cognitive disorders				27,067		26,031		4.0%		81,928		90,146		(9.1%)
of which		Tanakan ®		27,067		26,031		4.0%		81,928		90,146		(9.1%)
Cardiovascular				16,897		23,381		(27.7%)		57,948		71,552		(19.0%)
of which		Nisis ® & Nisisco ®		13,425		13,282		1.1%		41,911		38,288		9.5%
		Ginkor Fort ®		2,297		9,180		(75.0%)		12,157		29,350		(58.6%)
Other Primary Care products				3,297		1,047		214.9%		9,537		3,920		143.3%
of which		Adrovance ®		2,509		416		na		6,737		1,599		na
Primary care				90,464		94,410		(4.2%)		288,302		296,321		(2.7%)
Total Drug sales				229,696		214,355		7.2%		705,608		661,561		6.7%
Drug-related sales				8,018		9,713		(17.5%)		29,478		25,671		14.8%
Group Sales				237,714		224,067		6.1%		735,086		687,231		7.0%
(1) Peptide- or protein-based products

For the third quarter 2008, sales of specialist care products reached €139.2 million, up 16.1% year-on-year (third quarter 2007, €119,9 million). For the first nine months of 2008, sales reached €417.3 million, up 14.3%, slightly enhanced by some seasonal stocking in China and Russia. Sales of specialty care products represented 56.8% of the Group’s consolidated sales, against 53.1% a year earlier.

• In the oncology franchise, sales of Decapeptyl ^® reached €64.3 million for the third quarter 2008, up 14.5% year-on-year, reflecting a continued good performance, notably driven by strong sales in China, Middle East and Germany. For the first nine months 2008, sales of Decapeptyl ^® were up 9.0%, driven by strong sales in China, Germany and Algeria, despite a certain slowdown in France, Spain and the Middle East.
• In endocrinology, sales reached €39.0 million for the third quarter 2008, up 23.2% year-on-year (third quarter 2007, €31.6 million), driven by the strong performance of Somatuline ^® and NutropinAq ^® in all markets. For the first nine months of 2008, sales in endocrinology represented 15,7% of total Group sales, against 13,8% a year earlier.

Somatuline ® – For the third quarter 2008, sales reached €30.5 million, up 22.1% year-on-year (third quarter 2007, €25.0 million). For the first nine months of 2008, Somatuline® sales amounted to €90,0 million, up 18.6% year-on-year, fuelled by strong growth in Nordic countries, Spain, Germany and France and by the succesfull launch of Somatuline® Depot in the United States, as the Group booked the sales of the product to Tercica Inc. for a total amount of €2.7 million.

NutropinAq ® – For the third quarter 2008, sales reached €7.4 million, up 22.9% year-on-year (third quarter 2007, €6.0 million). For the first nine months of 2008, sales of NutropinAq® amounted for €22.6 million, up 28.8% year-on-year driven by strong performances in all countries, especially in Italy, France, Spain and Romania.

Increlex ® – For the third quarter 2008, sales of Increlex® reached €0.5 million. Increlex® has been launched in Germany, Austria, the United Kingdom, Nordics, Hungary and Czech Republic in late 2007 and in France, Spain, Poland, Italy, Greece, Portugal and Belgium in 2008. For the first nine months of 2008, sales of Increlex® reached €1.2 million.

• In the neuromuscular disorders franchise, sales reached €35.9 million, up 11.9% year-on-year (third quarter 2007, €32.1 million).

Dysport ® – For the third quarter 2008, sales reached €34.5 million, up 7.4% year-on-year (third quarter 2007, €32.1 million). For the first nine months of 2008, sales of Dysport® amounted to €110.5 million, up 15.4% year-on-year, fuelled by the good performances in Russia, Greece, the United Kingdom and France and by the start of the distribution agreement in aesthetic indications with Galderma in Brazil.

Apokyn ® – Following the closing of the acquisition of a North American neurology commercial platform and the rights to market Apokyn® in the United States in July 2008, the Group booked €1.4 million in sales for the third quarter 2008.

In the third quarter 2008, sales of Primary Care products reached €90.5 million, down 4.2% year-on-year (third quarter 2007, €94.4 million). For the first nine months 2008, sales of Primary Care products reached €288.3 million, down 2.7% year-on-year (first nine months 2007, €296.3 million), representing 37.6% of the Group’s consolidated sales, against 38.8% a year earlier. The solid sales growth in gastroenterology (up 6.3% year-on-year) and the favourable impact of the launch of Adrovance ^® were more than offset by the impact of the divestment of Ginkor Fort ^® as of 1 January 2008 and the negative performance of Tanakan ^® in France.

• In gastroenterology, sales reached €43.2 million, down 1.7% year-on-year (third quarter 2007, €44.0 million).

Smecta ® – For the third quarter 2008, sales reached €21.1 million, down 8.0% year-on-year (third quarter 2007, €23.0 million), due to lower sales in Russia, partly due to a destocking effect. For the first nine months 2008, sales of Smecta® amounted to €71.5 million, up 5.2% year-on-year. Sales of Smecta® outside of France reached 72.7% of total sales of the product in the first nine months of 2008, compared with 71.9% a year ago.

Forlax ® – For the third quarter 2008, sales reached €12.9 million, stable year-on-year. For the first nine months of 2008, sales of Forlax® amounted to €39.8 million, up 3.2% year-on-year. Sales in France represented 75.0% of total sales of the product over the period, versus 74.7% a year ago. The Group will monitor its sales of Forlax® going into 2009 in a potentially increased competitive environment in France.

• In the cognitive disorders area, sales of Tanakan ^® for the third quarter of 2008 reached €27.1 million, up 4.0% year-on-year (third quarter 2007, €26.0 million) fuelled by strong growth in Russia and Eastern European countries and despite an increased competitive environment. For the first nine months 2008, sales of Tanakan ^® amounted to €81.9 million, down 9.1% year-on-year despite a solid 18.9% growth outside France. Sales of Tanakan ^® in France represented 54.7% of total Tanakan ^® sales compared with 65.1% a year earlier.
• In the cardiovascular area, sales in the third quarter 2008 amounted to €16.9 million, down 27.7% year-on-year (third quarter 2007, €23.4 million). For the first nine months 2008, sales reached €57.9 million, down 19.0% year-on-year mainly due to the divestment of Ginkor Fort ^® as of January 2008.

Nisis ® and Nisisco ® – For the third quarter 2008, sales reached €13.4 million, up 1.1% year-on-year (third quarter 2007, €13.3 million). For the first nine months of 2008, sales reached €41.9 million, up 9.5% year-on-year.

Ginkor Fort ® (divested in January 2008) – For the third quarter 2008, supply sales of Ginkor Fort® to its OTC distributor amounted to €2.3 million. For the first nine months of 2008, sales reached €12.2 million.

• Other primary care products sales reached €3.2 million for the third quarter 2008, against €1.0 million a year earlier, with sales of Adrovance ^® launched in France in April 2007 contributing to €2.5 million during the third quarter 2008. For the first nine months of 2008, other primary care products sales reached €9.5 million, with sales of Adrovance ^® , reaching €6.7 million.

For the third quarter 2008, drug-related sales (active ingredients and raw materials) were down 17.5% to €8.0 million due to a low third quarter in Germany, influenced by a stocking effect during the second quarter. For the first nine months of 2008, drug related sales amounted to €29.5 million, up 14.8% year-on-year. This growth was mainly driven by seasonal strong sales of Ginkgo biloba extract in Germany and other active ingredients in Switzerland.

Contact:

Ipsen
Didier Véron
Director of Public Affairs
and Corporate Communications
Tel.: +33 (0)1 44 30 42 38
Fax: +33 (0)1 44 30 42 04
E-mail: didier.veron@ipsen.com
or
David Schilansky
Investor Relations Officer
Tel.: +33 (0)1 44 30 43 31
Fax: +33 (0)1 44 30 43 21
E-mail: david.schilansky@ipsen.com