Women First Reports Net Loss of $0.08 Per Share, Year-Over-Year Loss Reduced 87%; Both Pharmaceutical and Consumer Divisions Report Profit


SAN DIEGO, July 26, 2001 (PRIMEZONE) -- Women First HealthCare, Inc. (Nasdaq:WFHC) today announced significant improvement in its operating results for the second quarter ended June 30, 2001. The Company reported a net loss of $1.5 million or $0.08 per share. In last year's second quarter the Company lost $10.7 million or $0.61 per share. For the six months through June 30, 2001 the Company lost $2.4 million, or $0.14 per share, compared to a net loss of $18.7 million, or $1.07 per share, in the prior period, an improvement of $16.3 million or 87.1%.

The Company reported second quarter 2001 total net revenue of $5.6 million as compared to $5.8 million for second quarter 2000, a 4.6% decrease. Net revenue for the Company's core pharmaceutical products -- ORTHO-EST(r) Tablets and Esclim(tm) -- grew 85.5% over the comparable quarter last year. For the six-month 2001 period, total net revenue was $12.7 million, 5.1% below the prior year's $13.3 million. However, excluding nonrecurring related party service revenue in 2000, year-over-year total net revenue actually increased by 39.2%. Core pharmaceutical product net revenue was up 117% for the six-month period ended June 30, 2001.

Gross margins improved dramatically in 2001, to 76.5% and 70.3%, in the three-month and six-month periods, respectively. The comparable gross margins from the prior year were 29.8% and 51.9%, reflecting the minimum payment requirement that existed prior to the Company acquiring ORTHO-EST(r) Tablets.

Total expenses in the 2001 periods were less than half of what they were in the 2000 periods. For the three-month and six-month periods 2001, operating expenses totaled $5.8 million and $11.8 million, respectively. The comparable prior period amounts were $12.7 million and $26.3 million, respectively. The improvement in operating expenses is the result of the Company's ongoing efforts to more closely align expenses with revenues following its restructuring in July 2000.

Commenting on the results, Edward F. Calesa, chairman, president and CEO, said, "We remain on track to achieve the best year of our existence in 2001. Sales remain strong, margins have been strengthened and expenses continue to decline as our efforts to reach profitability continue to dominate our focus. Of particular note this quarter were our acquisition of Midrin(r), the profitability of both of our operating divisions and an increase in our cash position from March 31, 2001. Our short-term goal remains reaching breakeven in the fourth quarter of this year and achieving profitability in 2002."

Business Segments

The Company reports results in three segments as follows:

The Pharmaceutical Division recorded net revenue of $3.5 million in the second quarter 2001 from sales of its core products, ORTHO-EST(r) Tablets and Esclim(tm) transdermal system, an increase of 85.5% over net revenue from sales in the prior year period. For the six-month period, these products achieved a 117% sales growth over the prior year period. In 2001, the pharmaceutical segment earned $532,000 in the second quarter and $884,000 in the six-month period compared to a net loss of $8.7 million and $14.1 million in the prior periods. Effective June 29, 2001, the Company acquired Midrin(r), a prescription headache management product from Elan Corporation, plc. The Company's statements of operations for the three and six months ended June 30, 2001 were not significantly impacted by the acquisition.

The Consumer Business Division recorded net revenue in 2001 of $2.1 million and $4.1 million for the three and six-month periods respectively, down from $2.4 million and $4.7 million in the prior year periods. The Consumer Business focus for 2001 is to reduce expenses and limit the loss significantly while supporting the Company's pharmaceutical products. The segment produced a small profit for the second quarter 2001 versus a $327,000 loss in the second quarter 2000. For the six-month periods, the segment had a net loss of $245,000 in the current year compared to a net loss of $543,000 in 2000.

The Trialogue(tm) Division's focus shifted in 2001 to provide strategic marketing programs for sale to major pharmaceutical companies. Trialogue(tm) recorded no revenue in the second quarter or first six months of 2001 as it continues the rollout of a unique new marketing program called Integrated Marketing Platform. Trialogue(tm) revenue in 2000, $1.6 million for the quarter and $3.2 million for the six months, was primarily related party service revenue and is nonrecurring.

Financial Position

The Company's cash position at June 30, 2001 was $9.2 million, up slightly from the March 31, 2001 level and $300,000 below the year-end level. During last year's first six months, cash declined $14.5 million or $2.4 million per month. Working capital at June 30, 2001 was $9.3 million, $300,000 below the year-end level, and stockholders' equity increased to $17.1 million from $15.0 million at year-end. The Company has long-term debt of $11 million in the form of convertible secured debt issued to acquire Midrin(r).

About Women First HealthCare, Inc.

Founded in 1996, Women First HealthCare, Inc. is a San Diego-based specialty pharmaceutical company. Its mission is to help midlife women make informed choices regarding their health care needs and to provide pharmaceutical and lifestyle products to meet those needs. Women First is specifically targeted to women age 40+ and their clinicians. The Company's Pharmaceutical Division, which includes a nationwide team of experienced sales specialists, contacts primarily OB/GYNs and Nurse Practitioners with estrogen replenishment options -- ORTHO-EST(r) Tablets (estropipate) and Esclim(tm) (estradiol transdermal system) -- and the prescription headache management product, Midrin(r) (isometheptene mucate, USP, dichloralphenazone, USP and acetaminophen, USP). The Consumer Business is responsible for Daily Difference(tm) dietary supplements, developed in consultation with Tufts University School of Nutrition Science and Policy, and the Company's line of self-care products available through its As We Change(r) national mail order catalog and Internet retailer, www.aswechange.com. Trialogue(tm), the Corporate Marketing Division, is responsible for providing access to Women First's network of opinion leaders and clinicians through strategic marketing programs for sale to major pharmaceutical companies. The Company's business strategy includes the acquisition and licensing of additional prescription products that support its mission. Further information about Women First can be found online at www.womenfirst.com.

ORTHO-EST(r) Tablets and Esclim(tm) are indicated for the relief of moderate to severe vasomotor symptoms associated with menopause. ORTHO-EST(r) Tablets are also indicated for the prevention of osteoporosis. The most commonly reported side effects of ORTHO-EST(r) Tablets and Esclim(tm) are those typical of estrogen replenishment therapy: breast tenderness, headache, nausea, and abdominal pain. Estrogens have been reported to increase the risk of endometrial carcinoma in postmenopausal women. Estrogens are contraindicated in patients with known or suspected pregnancy, undiagnosed abnormal genital bleeding, known or suspected breast cancer, known or suspected estrogen-dependent neoplasia, or active thrombophlebitis or thromboembolic disorders. Midrin(r) is indicated for relief of tension and vascular headaches. Midrin(r) is contraindicated in glaucoma and/or severe cases of renal disease, hypertension, organic heart disease, hepatic disease and in those patients who are on monoamine-oxidase (MAO) inhibitor therapy. Caution should be observed in hypertension, peripheral vascular disease and after recent cardiovascular attacks. Adverse reactions can include transient dizziness and skin rash in hypersensitive patients, which can usually be eliminated by reducing dosage. For more information about these products or to see the package insert, please visit www.womenfirst.com, Rx Products area.

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: This press release may contain certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to various risks, and Women First HealthCare, Inc. cautions you that any forward-looking information is not a guarantee of future performance. Women First HealthCare, Inc. disclaims any intent or obligation to update these forward-looking statements. Actual results could differ materially due to a number of factors, including (i) we have incurred significant losses since we were founded in November 1996, and if midlife women do not use, and their clinicians do not recommend, the products we offer, we will continue to experience significant losses; (ii) there is a limited market awareness of our Company and the products and services we offer; (iii) we may need additional financing in 2001 to fund our operations, acquire new products, and make planned capital expenditures, which financing may not be available on acceptable terms, if at all; (iv) we may not be able to identify appropriate licensing, co-promotion or acquisition candidates in the future or to take advantage of the opportunities we identify; (v) we and our products face significant competition; (vi) if we do not successfully manage any growth we experience, we may experience increased expenses without corresponding revenue increases; (vii) we are dependent on single sources of supply for all of the products we offer; and (viii) additional factors set forth in the Company's Securities and Exchange Commission filings including its Annual Report on Form 10-K for the period ended December 31, 2000 and its Form 10-Q for the period ending March 31, 2001.


                   Women First HealthCare, Inc.
              Consolidated Statements of Operations
                          (Unaudited)

                    Three months ended         Six months ended
                         June 30,                   June 30,
               --------------------------  --------------------------
                   2001          2000          2001           2000
               ------------  ------------  ------------  ------------

 Net product
 revenue       $  5,556,771  $  4,248,069  $ 12,621,194  $  8,607,228

 Net service
  revenue              --         262,000          --         462,000
 Net service
  revenue from
  related
  party                --       1,316,330        43,843     4,276,339
               ------------  ------------  ------------  ------------
 Total service
  revenues             --       1,578,330        43,843     4,738,339
               ------------  ------------  ------------  ------------
 Total net
  revenues        5,556,771     5,826,399    12,665,037    13,345,567


 Costs and
 expenses:
  Cost of
   sales          1,306,219     4,092,202     3,763,910     6,417,913
  Marketing 
   and sales      3,330,094     9,878,055     7,566,163    20,793,878
  General and
   admini-
   strative       2,360,592     1,993,142     3,963,062     4,383,684
  Research and
   development      101,649       119,075       225,836       388,357
  Restructuring
   charges             --         734,665          --         734,665
               ------------  ------------  ------------  ------------
 Total costs
  and expenses    7,098,554    16,817,139    15,518,971    32,718,497
               ------------  ------------  ------------  ------------
 Loss from    
  operations     (1,541,783)  (10,990,740)   (2,853,934)  (19,372,930)
 Interest and
  other
  income, net        87,908       326,680       443,325       710,456
               ------------  ------------  ------------  ------------
 Net loss      $ (1,453,875) $(10,664,060) $ (2,410,609) $(18,662,474)
               ============  ============  ============  ============
 Net loss per
  share
  (basic and
   diluted)    $      (0.08) $      (0.61) $      (0.14) $      (1.07)
               ============  ============  ============  ============
 Weighted
  average
  shares used
  in computing
  net loss per
  share (basic
  and diluted)   17,760,365    17,479,867    17,685,816    17,425,666
               ============  ============  ============  ============


                 Women First HealthCare, Inc.
                 Consolidated Balance Sheets
   
                                     June 30,       December 31,
                                       2001            2000
                                   ------------    ------------
                                    (Unaudited)
 Assets
 Current assets:
  Cash and cash equivalents        $  9,208,013    $  9,507,865
  Accounts receivable, net            1,448,076         421,435
  Inventory                           1,913,795       1,387,872
  Receivable from related party            --         2,682,468
  Prepaid expenses and
   other current assets                 599,139         544,283
                                   ------------    ------------
     Total current assets            13,169,023      14,543,923
 Property and equipment, net            968,176       1,081,214
 Product rights                      13,902,915            --
 Intangible assets, net               3,024,665       3,266,840
 Other assets                           973,315       1,152,398
                                   ------------    ------------
     Total assets                  $ 32,038,094    $ 20,044,375
                                   ============    ============

 Liabilities and
   stockholders' equity
 Current liabilities:
  Accounts payable                 $    881,868    $  1,052,322
  Payable to related party              166,263         992,745
  Accrued salaries and
    employee benefits                 1,372,891         750,902
  Other accrued liabilities           1,497,362       2,213,245
                                   ------------    ------------
     Total current liabilities        3,918,384       5,009,214
 Note payable                        11,000,000            --
 Commitments                               --              --
 Stockholders' equity:
  Preferred stock                          --              --
  Common stock                           18,592          17,593
  Treasury stock                        (99,660)        (99,660)
  Additional paid-in capital         85,230,779      80,794,541
  Deferred compensation                (173,761)       (231,682)
  Accumulated deficit               (67,856,240)    (65,445,631)
                                   ------------    ------------
     Total stockholders' equity      17,119,710      15,035,161
                                   ------------    ------------
     Total liabilities and
       stockholders' equity        $ 32,038,094    $ 20,044,375
                                   ============    ============


            

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