Arena Pharmaceuticals, Inc.
Apr 24, 2002

Arena Pharmaceuticals Announces Financial Results For the First Quarter of 2002

SAN DIEGO, Apr 24, 2002 /PRNewswire-FirstCall via COMTEX/ -- Arena Pharmaceuticals, Inc. (Nasdaq: ARNA) today reported revenues of $4.2 million for the quarter ended March 31, 2002, versus $5.4 million in revenues for the quarter ended March 31, 2001. Revenues in the first quarter of 2002 and 2001 were attributable to collaborations, which included research funding, milestone payments and technology access and development fees. The Company reported a net loss for the first quarter of 2002 of $6.5 million, or $.24 per share, after non-cash amortization charges of $1.1 million. This compares with prior year results for the first quarter of a net profit of $1.1 million, or $.05 per share, after non-cash amortization charges of $1.4 million.

Research and development expenses increased to $8.8 million in the first quarter of 2002 as compared to $3.9 million in the first quarter of 2001. The expense increase was primarily due to the increase in scientific personnel and laboratory supplies needed to expand our internal drug discovery and development programs.

Cash, cash equivalents and short-term investments totaled $215.2 million at March 31, 2002.

"Arena had an excellent first quarter in which we achieved many important scientific and partnering milestones," said Jack Lief, President and CEO. "We continued to grow our scientific organization, and we believe we may have discovered many new exciting drug targets including the niacin receptor, moved our internal discovery programs closer toward an IND, and fulfilled our partnering commitments. In the coming months, I look forward to discussing our continued pharmaceutical development progress along with exciting new revenue generating collaborations."

Arena's CART and Melanophore technologies allow for the direct identification of modulators of G protein-coupled receptors ("GPCRs") in a ligand-independent manner, making the technologies particularly useful with respect to the GPCRs of therapeutic interest within the human genome. Arena has initiated "Project Genesis," an internal program aimed at obtaining all of the human GPCRs, identifying the location of these receptors within the human body for purposes of understanding the function of such receptors, and screening each GPCR to identify receptor modulators that form the basis of drug candidates. We believe that our CART and Melanophore technologies will facilitate completion of Project Genesis within the next two to four years.

Certain statements in this press release are forward-looking statements that involve a number of risks and uncertainties. Such forward looking statements include statements about the Company's strategy, our discoveries, our internal programs, and statements that are not historical facts, including statements which are preceded by the words "intends," "will," "plans," "expects," "anticipates," "estimates," "aims," and "believes" or similar words. For such statements, Arena claims the protection of the Private Securities Litigation Reform Act of 1995. Actual events or results may differ materially from Arena's expectations. Important factors that could cause actual results to differ materially from those stated or implied by Arena's forward looking statements due to risks and uncertainties associated with Arena's business include, but are not limited to, the following: the ability to complete Project Genesis, if at all, within a reasonable time period; future quarterly or annual financial results; the timing, success and cost of preclinical research, out-licensing endeavors and clinical studies; and receipt of additional milestone payments, if any, from collaborators. Additional risk factors that could cause actual results to differ materially from those in Arena's forward looking statements are disclosed in Arena's SEC reports, including, but not limited to, Arena's most recent quarterly report on Form 10-Q and its most recent annual report on Form 10-K. These forward-looking statements represent Arena's judgment as of the date of this release. Arena disclaims, however, any intent or obligation to update these forward-looking statements.

                         Arena Pharmaceuticals, Inc.
               Condensed Consolidated Statements of Operations

                                                   Three months ended
                                                         March 31,
                                                  2002            2001
                                                        (unaudited)
     Revenues
        Total revenues                         $4,240,304       $5,392,335

     Expenses
     Research and development                   8,841,060        3,903,341
     General and administrative                 1,769,753        1,025,983
     Amortization of non-cash
       deferred compensation                      755,609        1,268,666
     Amortization of acquired
       technology                                 384,249          128,083
        Total expenses                         11,750,671        6,326,073
     Interest and other income, net             1,040,633        2,018,732
     Net income (loss)                        $(6,469,734)      $1,084,994

     Net income (loss) per share,
       basic and diluted                           $(0.24)           $0.05

     Shares used in calculating
       net income (loss) per share, basic      27,363,447       22,272,476

     Shares used in calculating net
       income (loss) per share, diluted        27,363,447       23,247,747


     Condensed Consolidated
       Balance Sheet Data:                    March 31,        December 31,
                                                 2002             2001
                                              (unaudited)
     Assets
       Cash, cash equivalents
         and short-term investments          $215,152,890     $226,924,293
       Other current assets                     8,879,714        6,384,531
       Land, property and
         equipment, net                        25,894,338       23,268,567
       Acquired technology,
         investments and other assets          20,463,895       20,396,319
          Total assets                       $270,390,837     $276,973,710

     Liabilities and Stockholders' Equity
       Liabilities                             $7,009,840       $7,500,032
       Stockholders' equity                   263,380,997      269,473,678
          Total liabilities and
           stockholders' equity              $270,390,837     $276,973,710

"Arena Pharmaceuticals" and "Arena" are registered U.S. trademarks of the company. "CART" is a trademark of the company. Arena's headquarters are located at 6166 Nancy Ridge Drive, San Diego, CA 92121. Arena's telephone number is (858) 453-7200. On the Internet, please refer to Arena's website: http://www.arenapharm.com or BRL Screening's website: http://www.brlscreening.com for further information regarding CART and Melanophore technologies.

SOURCE Arena Pharmaceuticals, Inc.

CONTACT: Jack Lief, President & CEO, ext. 223, or Joseph Mooney, CFO, ext. 508, both of Arena Pharmaceuticals, +1-858-453-7200