Algos Pharamceuticals Corporation
Ticker: ALGO 4900 Route 33
Exchange: NASDAQ-National Market Neptune, New Jersey 07753
Industry: Manufacturing (908) 938-5959

Type of Shares:Common Shares Filing Date:5/22/96
U.S. Shares:3,500,000 Offer Date:9/25/96
Non-U.S. Shares:0 Filing Range:$14.00 - $16.00
Primary Shares:3,500,000 Offer Price:$14.00
Secondary Shares:0 Gross Spread:$0.98
Offering Amount: $52,500,000 Selling:$0.55
Expenses:$800,000 Reallowance:$0.10
Shares Out After:15,544,119

ManagerTierPhone
Lehman Brothers IncorporatedLead Manager (212) 640-6129
Cowen & CompanyCo-manager (212) 495-6000

Audited
Income
Latest
Unaudited
Income
Prior
Unaudited
Income
Balance
Sheet
12/31/95 3/31/96 3/31/95 3/31/96
Revenue:$0.00$0.00$0.00Assets:$3.20
Net Income:-$2.12-$0.57-$0.55Liabilities:$0.23
EPS:-$0.18-$0.05Equity:$2.97

Note: Dollar amounts are in U.S. millions; Audited figures expressed as full year,
unaudited figures are partial year

Business Description
Algos Pharmaceutical Corporation ('Algos' or the 'Company') is a leader in developing a new generation of proprietary pain management products. Independent research, the Company's pre-clinical studies and initial clinical trials have shown that the Company's products may significantly improve pain relief over currently available analgesics, including narcotic drugs such as morphine, hydrocodone and oxycodone and non-narcotic analgesics such as acetaminophen, ibuprofen and naproxen. The Company is also developing a local anesthetic product that is expected to provide greater anesthetic effect with longer and more controlled duration than existing products. The Company develops its proprietary pain management products by combining existing analgesic or anesthetic drugs with N-methyl-D-aspartate ('NMDA') antagonist drugs that have been approved for human use in other applications. The Company believes that its analgesic and anesthetic products have the potential for more rapid market introduction than many other new drugs because (i) the Company's products combine existing drugs whose separate safety profiles are known and established and (ii) clinical trials for new analgesics and anesthetics historically have achieved statistically significant results with fewer patients than may be required for many other drugs.

Use of Proceeds
The proceeds from the proposed offering will be used to fund research and product development; the establishment of a direct sales force; working capital and other general corporate purposes.

Last updated: 10/28/96

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