Lek's Semiannual Sales Results

In the first half of 2002, Lek Pharmaceuticals d.d. exceeded its planned business goals in spite of legislative changes in the Republic of Slovenia and the weakening of the US dollar. Lek’s main growth factors are the macroeconomic stability of its most important markets, a solid growth of sales in its traditional markets (Poland, Russia and the Czech Republic) and resumed sales of its new products on the US market. The purchases of a Polish and a Romanian pharmaceutical company in 2001 have also contributed considerably to its dynamic sales growth.

In the first six months of 2002, the sales of Lek d.d. amounted to SIT 43 billion, a 24% increase compared with the same period last year. Prescription medicines and pharmaceutical active ingredients represented the greatest percentage of Lek’s sales, 75.8% of which are prescription medicines and 12.4% pharmaceutical active ingredients. These are followed by self-medication drugs (7.3%) and veterinary products (4.5%). The Lek Group concluded the first half of 2002 with sales of SIT 46 billion, realizing a 23% growth compared with the same period last year. The parent company’s semiannual sales results do not include the semiannual sales results of Lek Kozmetika, which began operating as Lek’s independent subsidiary on 1 January 2002.

The sales of the Lek Group in its ten largest markets accounted for over 80% of its total sales. The growth of the Group’s sales in these markets is on the increase: in Slovenia, its growth rate is 9.6%, in Poland 30.8%, in Russia 12.4%, in the US 269.7%, in Croatia 4.0% and in its remaining five most important markets, 26.5%.

In 2001, Lek internationalized its most important trademarks among antibiotics, cardiovascular drugs, gastrointestinal drugs and drugs for the musculoskeletal system. The growth rate of Lek’s ten best-selling products is 42%. Among these, Amoksiklav accounts for the greatest share, followed by drugs for the treatment of bacterial infections (a 37% rise in sales), Ketonal, an analgesic and anti-inflammatory drug (54%), Amlopin, an antihypertensive (47%) and Bromergon (active ingredient bromocriptine), a drug for the treatment of Parkinson’s disease (444% growth in sales). At the end of January 2002, immediately after its approval by the FDA, Lek began marketing this drug on the US market.

Lek’s semiannual sales results are the result of its strategy of constant growth in sales. The parent company’s growth rate of 24% is greater than the average growth rate of the global pharmaceutical market. In 2001, Lek considerably internationalized its operations and has been expanding them in line with changes in the global environment.

However, the semiannual sales figures do not include the sale of lisinopril, for which Lek acquired FDA approval in June 2002 and will begin marketing in the second half of 2002; therefore, Lek’s sales increases in the US market are expected to be even better in the latter half of this year.

Lek has begun preparations for launch of its leading product, Amoksiklav, on the US market. The sales of Amoksiklav in the US will provide the basis for further growth in subsequent years.

In view of favorable conditions for sales growth in Lek’s traditional markets in Central and Eastern Europe, as well as in Southeastern Europe, Lek is implementing its strategy of expanding its sales and other activities in the European and US markets, adding a new element of growth to the company’s business operations and future development.

Lek d.d. will publish its semiannual financial results for 2002 at the end of August.