Neurochem reports results for fourth quarter and fiscal year 2007 and important advances on corporate objectives



    Neurochem will host a conference call Thursday, February 21, 2008,
    at 8:30 A.M. ET.

    LAVAL, QC, Feb. 20 /CNW Telbec/ - Neurochem Inc. (NASDAQ:   NRMX; TSX: NRM)
reports results for the fourth quarter and fiscal year ended December 31,
2007, and announces important advances regarding the Company's pharmaceutical
and nutraceutical activities. The Company reports, for the fourth quarter, a
net loss of $16,097,000 ($0.33 per share), compared to $17,011,000 ($0.44 per
share) for the corresponding period in the previous year. For the year ended
December 31, 2007, the net loss amounted to $81,486,000 ($1.85 per share),
compared to $66,469,000 ($1.72 per share) for the same period last year. The
net loss for the year ended December 31, 2007, includes a non-recurring charge
in the second quarter of fiscal 2007 under Canadian GAAP of $10,430,000
relating to the $40 million 5% senior subordinated convertible notes, which
were fully converted into common shares during the second quarter of 2007. In
total, accretion expense amounted to $15,751,000 for the year ended
December 31, 2007. As at December 31, 2007, the Company had available cash,
cash equivalents and marketable securities of $58,672,000, compared to
$48,758,000 at December 31, 2006. All figures are in U.S. dollars, unless
otherwise specified.
    Furthermore, the Company is pleased to announce the following important
developments:

    
    - The regulatory submission for the initiation of the Phase II clinical
      trial with the investigational product candidate NC-503 in patients
      with Type II Diabetes as well as certain features of Metabolic Syndrome
      was accepted by the Therapeutic Products Directorate of Health Canada.
      As a result, the first patient is expected to be enrolled shortly. The
      key objectives of the study are to investigate the safety and proof-
      of-concept efficacy of NC-503 on glycemic measures.
    - In order to more accurately reflect the Company's expanded business
      strategy and core programs that encompass both therapeutics and branded
      nutraceutical products, and following the approval by Neurochem's Board
      of Directors, the name-change from Neurochem to BELLUS HEALTH(TM),
      pending shareholder approval at the next annual meeting.
    - Approval by Neurochem's Board of Directors for the creation of
      subsidiaries for the purposes of carrying on the Company's
      nutraceutical business, and as part of these new developments, the
      nutraceutical business will be named OVOS NATURAL HEALTH(TM).
    - An amendment under the Equity Line of Credit Facility, extending the
      term to February 2010. The minimum draw-down obligation by the Company
      has been reduced to $15,000,000 over the term. The maximum amount of
      each monthly draw-down is limited to the lower of $6,000,000 or
      12.5% of the volume-weighted price calculation of the common shares at
      the time of draw-down. The common shares will be issued at a discount
      of 4.0% to market price if the volume-weighted average price (VWAP)
      per share is $6 or higher and 7% if the VWAP per share is lower than $6
      at the time of draw-down.

    "Neurochem is making significant progress in the implementation of the
strategy that aims to make homotaurine available to consumers. Our drive
towards the commercialization of this brand under the leadership of
Mr. Gary Schmid as CEO of our nutraceutical business is geared towards
potentially selling homotaurine via the Internet as early as the second
quarter of 2008 and made available at retail in Canada during the third
quarter of 2008," said Dr. Francesco Bellini, Chairman, President and CEO of
Neurochem. "With respect to our pharmaceutical activities, we are continuing
to accelerate the development of our product candidates in the field of
Diabetes and Alzheimer's disease and closely working with the regulatory
agencies in Europe and the United States to hopefully be in a position to make
KIACTA(TM) available to patients suffering from Amyloid A (AA) amyloidosis.
The launch of a Phase II study for NC-503 as a treatment for Type II Diabetes
as well as certain features of Metabolic Syndrome is very encouraging. As a
natural extension of our work in the field of AA amyloidosis, we start with a
solid base of knowledge and research already completed," Dr. Bellini
concluded.

    Phase II Study for Type II Diabetes as well as certain features of
    Metabolic Syndrome Underway

    The Phase II clinical trial is a 26 weeks multi-center, randomized, double
blind, placebo-controlled and parallel-designed study that will involve
approximately 200 patients with Type II Diabetes as well as certain features
of Metabolic Syndrome in about 15 clinical sites in Canada.

    Conference Call

    Neurochem will host a conference call Thursday, February 21, 2008, at 8:30
A.M. Eastern Time. The telephone numbers to access the conference call are
1-416-644-3416 or 1-800-732-9303. A replay of the call will be available until
Thursday, February 28, 2008. The telephone numbers to access the replay of the
call are 1-416-640-1917 or 1-877-289-8525, for which the passcode is
21263770#. Please dial-in approximately 15 minutes before the teleconference
is scheduled to begin.

    Consolidated Financial Results Highlights

    The following discussion and analysis should be read in conjunction with
the Company's audited consolidated financial statements for the year ended
December 31, 2007, which have been prepared in accordance with Canadian
generally accepted accounting principles (GAAP).

    Results of operations

    As previously reported, effective July 1, 2007, the Company adopted the US
dollar as its functional and reporting currency, as a significant portion of
its revenue, expenses, assets, liabilities and financing are denominated in US
dollars. All currency figures reported in this document, including comparative
figures, are reported in US dollars, unless otherwise specified.
    For the three-month period ended December 31, 2007, the net loss amounted
to $16,097,000 ($0.33 per share), compared to $17,011,000 ($0.44 per share)
for the corresponding period in the previous year. For the year ended
December 31, 2007, the net loss amounted to $81,486,000 ($1.85 per share),
compared to $66,469,000 ($1.72 per share) for the same period the previous
year.
    The net loss for the year ended December 31, 2007, includes a
non-recurring charge in the second quarter of fiscal 2007 under Canadian GAAP
of $10,430,000 relating to the $40 million 5% senior subordinated convertible
notes, which were fully converted into common shares during the second quarter
of 2007. In total, accretion expense amounted to $15,751,000 for the year
ended December 31, 2007.
    Revenue from collaboration agreement amounted to $206,000 for the current
quarter ($1,119,000 for the year), compared to $497,000 for the same period in
the previous year ($2,106,000 for the year). This revenue is earned under the
agreement with Centocor, Inc. (Centocor) in respect of
eprodisate       (KIACTA(TM)), an oral investigational product candidate for
the treatment of Amyloid A (AA) amyloidosis. Revenue recognized is in respect
of the non-refundable upfront payment received from Centocor, which is being
amortized over the estimated period through to the anticipated regulatory
approval date of the investigational product candidate. The estimated period
is subject to change based on additional information that the Company may
receive periodically. The other portion of the upfront payment received from
Centocor ($6,000,000) has been classified as deferred revenue and is not being
amortized as earned revenue given that it is potentially refundable. In the
event that the Company receives an approval letter issued by the US Food and
Drug Administration (FDA), the amount would no longer be refundable and would
be amortized as earned revenue.
    In December 2007, the Company received an acknowledgement from the FDA
that Neurochem's response to the approvable letter received in July 2007 for
the New Drug Application (NDA) for eprodisate (KIACTA(TM)) for the treatment
of AA amyloidosis is a complete, Class 2 response. The PDUFA (Prescription
Drug User Fee Act) goal date by which the FDA is expected to render a decision
is April 2, 2008. In the second approvable letter (July 2007), the FDA
indicated that an additional efficacy trial will be necessary before the FDA
could approve the investigational product candidate. The approvable letter
also states that additional submissions, filed by Neurochem as part of its
response to this approvable letter, may address issues raised in this letter.
The FDA has indicated that additional submissions could persuade the agency to
eliminate the requirement for an additional trial. The FDA also asked for
additional information, including further pharmacokinetic studies, and again
acknowledged that a QT clinical study should be submitted as part of a
Phase IV (post-approval) commitment.
    Neurochem has also submitted for marketing approval eprodisate      
(KIACTA(TM)) for the treatment of AA amyloidosis in the European Union and
Switzerland. In December 2007, the Committee for Medicinal Products for
Human Use (CHMP), the scientific committee of the European Medicines
Agency (EMEA), issued a negative opinion recommending refusal of the marketing
authorization application (MAA) for eprodisate (KIACTA(TM)) for the treatment
of AA amyloidosis in the European Union and concluded that another study would
be needed to demonstrate eprodisate's (KIACTA(TM)) effectiveness. The Company
requested a re-examination of the opinion by CHMP. As provided by the European
regulations, the Company requested that the CHMP consult a Scientific Advisory
Group in connection with the re-examination. The MAA is being reviewed under
the EMEA's centralized procedure. An authorization from the EMEA would apply
to all 27 European Union member states, as well as Norway and Iceland.
    The decrease in revenue from collaboration agreement for the current
periods compared to the same periods in the previous year is mainly
attributable to a change in the estimated period over which the non-refundable
upfront payment received from Centocor in respect of eprodisate (KIACTA(TM))
is being amortized.
    Reimbursable costs revenue amounted to $64,000 for the current quarter
($396,000 for the year), compared to $178,000 for the same period in the
previous year ($712,000 for the year) and consists of costs reimbursable by
Centocor in respect of eprodisate (KIACTA(TM))-related activities. The Company
earns no margin on these reimbursable costs.
    Research and development expenses, before research tax credits and grants,
amounted to $12,199,000 for the current quarter ($55,732,000 for the year),
compared to $14,142,000 for the same period in the previous year ($51,688,000
for the year). The decrease in the current quarter compared to the same period
the previous year is mainly attributable to a reduction in expenses incurred
in relation to the development of tramiprosate      (ALZHEMED(TM)), primarily
in respect of the North American Phase III clinical trial. Also, during the
second quarter of 2007, the workforce was reduced due to delay encountered in
the product candidate development programs. The increase in the current year
compared to the same period the previous year is due to expenses incurred in
relation to the development of tramiprosate (ALZHEMED(TM)), primarily in
respect of the Phase III clinical trial in Europe and the North American
open-label extension of the Phase III study, as well as the conduct of a QT
cardiac status Phase I study. For the year ended December 31, 2007, research
and development expenses also included costs incurred to support the North
American Phase III clinical trial for tramiprosate      (ALZHEMED(TM)), the
open-label extension of the eprodisate (KIACTA(TM)) Phase II/III study, as
well as ongoing drug discovery programs.
    In November 2007, the Company announced important initiatives following
key events that took place over the past year. The Company announced the
termination of the tramiprosate (ALZHEMED(TM); homotaurine) pharmaceutical
drug development program, including the early termination of its European
Phase III clinical trial, and the advancement of its next generation prodrug
of tramiprosate (ALZHEMED(TM)) into preclinical development for the treatment
of Alzheimer's disease (AD). Also, the Company announced its decision to take
steps to commercialize homotaurine as a branded nutraceutical, potentially
starting as early as 2008.
    Research tax credits and grants amounted to $727,000 this quarter
($2,161,000 for the year), compared to $607,000 for the corresponding period
in the previous year ($1,899,000 for the year). Research tax credits represent
refundable tax credits earned under the Quebec Scientific Research and
Experimental Development Program for expenditures incurred in Quebec. The
increase is due to higher eligible expenditures in the current periods and the
realization of tax credits from prior years that met the criteria for
recognition in the current year.
    Other research and development charges amounted to nil for the current
quarter and year, compared to $1,127,000 for the quarter and year ended
December 31, 2006. In 2006, the Quebec taxation authorities confirmed their
position in the application of the tax credit program that denied tax credits
on research and development taxable benefits relating to stock options for
2005 and prior years. Accordingly, management determined at that time that the
criteria for recognition of these credits were no longer met and recorded a
provision for these research tax credits.
    General and administrative expenses totaled $1,397,000 for the current
quarter ($10,581,000 for the year), compared to $2,819,000 for the same
quarter in the previous year ($11,522,000 for the year). These costs are
incurred to support the overall activities of the Company. The decrease is
mainly attributable to a reduction in management bonuses, and in
performance-based fees due to Picchio International Inc.
    Arbitral award amounted to nil for the current quarter and year compared
to nil for the quarter ended December 31, 2006 and $1,835,000 for the year
ended December 31, 2006. This expense related to the dispute with Immtech
Pharmaceuticals, Inc. (formerly known as Immtech International, Inc.
(Immtech), which came to a conclusion in January 2007 when Immtech, the
University of North Carolina at Chapel Hill (UNC), and Georgia State
University Research Foundation, Inc. filed with the Federal District Court for
the Southern District of New York, U.S.A. a Notice of Voluntary Dismissal. The
plaintiffs voluntarily dismissed their complaint against Neurochem in the
Federal District Court without any payment, license, business agreement,
concession or compromise by Neurochem.
    Reimbursable costs amounted to $64,000 for the current quarter ($396,000
for the year), compared to $178,000 for the same period in the previous year
($712,000 for the year), and consist of costs incurred on behalf of Centocor
in respect of eprodisate (KIACTA(TM))-related activities and reimbursable by
Centocor.
    Stock-based compensation amounted to $1,421,000 for the current quarter
($4,275,000 for the year), compared to $924,000 for the corresponding quarter
in the previous year ($3,569,000 for the year). This expense relates to stock
options and stock-based incentives, whereby compensation cost in relation to
stock options is measured at fair value at the date of grant and is expensed
over the award's vesting period. The increase is due to new stock options
granted during the past year.
    Depreciation, amortization and patent cost write-off amounted to $611,000
for the current quarter ($1,698,000 for the year), compared to $386,000 for
the corresponding quarter in the previous year ($1,556,000 for the year). The
increase is attributable to patent cost of $239,000 written off during the
year, for which no future benefit was expected to be realized.
    Interest income amounted to $756,000 for the current quarter ($3,341,000
for the year), compared to $574,000 for the same quarter in the previous year
($2,077,000 for the year). The increase is mainly attributable to higher
average cash balances during the current periods, compared to the same periods
in the previous year.
    Accretion expense amounted to $1,183,000 for the current quarter
($15,751,000 for the year), compared to $550,000 for the same quarter in the
previous year ($550,000 for the year). Accretion expense represents the
imputed interest under GAAP on the $42,085,000 aggregate principal amount of
6% convertible senior notes issued in November 2006, as well as on the
$40,000,000 6% senior convertible notes (Senior Notes) and $40,000,000
5% senior subordinated convertible notes (Junior Notes) issued in May 2007.
The Company accretes the carrying values of the convertible notes to their
face value through a charge to earnings over their expected lives of 60
months, 54 months and 1 month, respectively. Of the total accretion expense
recorded in the year ended December 31, 2007, $10,430,000 relates to accretion
expense on the Junior Notes, which were fully converted during the second
quarter of 2007. Refer to the Liquidity and Capital Resources section for more
details on the convertible notes.
    Change in fair value of embedded derivatives amounted to a gain of $28,000
for the current quarter (loss of $870,000 for the year) and represents the
variation in the fair value of the embedded derivatives included in the
aggregate $80,000,000 Senior and Junior Notes issued in May 2007.
    Change in fair value of third party asset-backed commercial paper amounted
to a loss of $1,184,000 for the quarter and year ended December 31, 2007 and
represents a provision recorded on the valuation of asset-backed commercial
paper held by the Company. Refer to Liquidity and Capital Resources section
for more details.
    Foreign exchange loss amounted to $54,000 for the current quarter (gain of
$1,130,000 for the year), compared to a gain of $245,000 for the same quarter
in the previous year (loss of $280,000 for the year). Foreign exchange gains
or losses arise on the movement in foreign exchange rates in relation to the
Company's net monetary assets denominated in currencies other than US dollars,
which is its functional and reporting currency, and consists primarily of
monetary assets and liabilities denominated in Canadian dollars. Foreign
exchange gains recognized for the year ended December 31, 2007, are mainly
attributable to the strengthening of the Canadian dollar compared to the US
dollar during the period.
    Other income amounted to $287,000 for the current quarter ($1,274,000 for
the year), compared to $282,000 for the same quarter in the previous year
($1,348,000 for the year). Other income consists of non-operating revenue,
primarily sub-lease revenue. The 2006 income includes an amount of $293,000 in
respect of the recovery of prior years' property taxes.
    Share of loss in a company subject to significant influence amounted to
nil for the current quarter ($327,000 for the year), compared to $489,000 for
the corresponding quarter in the previous year ($2,440,000 for the year).
Non-controlling interest amounted to nil for the current quarter ($109,000 for
the year), compared to $162,000 for the corresponding quarter in the previous
year ($801,000 for the year). These items result from the consolidation of the
Company's interest in a holding company (Innodia Holding) that owns shares of
Innodia Inc., for which Neurochem is the primary beneficiary. The share of
loss recorded in the current year has reduced the Company's long-term
investment in Innodia Holding to a nominal value. Innodia Inc. is a private,
development-stage company engaged in developing novel drugs for the treatment
of Type II diabetes and underlying diseases.

    Liquidity and capital resources

    As at December 31, 2007, the Company had available cash, cash equivalents
and marketable securities of $58,672,000, compared to $48,758,000 at
December 31, 2006. The increase is primarily due to proceeds received from the
issue of convertible notes in May 2007 and is partially offset by funds used
in operating activities.
    On May 2, 2007, the Company issued $80,000,000 aggregate principal amount
of convertible notes, consisting of $40,000,000 6% senior convertible notes
due in 2027 and $40,000,000 5% senior subordinated convertible notes due in
2012. The 6% senior convertible notes have an initial conversion price equal
to the lesser of $12.68 or the 5-day weighted average trading price of the
common shares preceding any conversion, subject to adjustments in certain
circumstances. The Company will pay interest on the 6% senior convertible
notes until maturity on May 2, 2027, subject to earlier repurchase, redemption
or conversion. The 5% senior subordinated convertible notes were subject to
mandatory conversion into common shares under certain circumstances. In
connection with this transaction, the Company issued warrants to purchase an
aggregate of 2,250,645 common shares until May 2, 2012, at an initial purchase
price of $12.68 per share, subject to adjustments in certain circumstances. .
During the year ended December 31, 2007, $35,500,000 of the 6% senior
convertible notes were converted into 5,619,321 common shares and the totality
of the 5% senior subordinated convertible notes were converted into
4,444,449 common shares. Net proceeds from the offering were $74,279,000 and,
as of December 31, 2007, $34,274,000 has yet to be spent. As at December 31,
2007, the use of proceeds has conformed in all material respects with the
expectations set forth in the prospectus filed publicly.
    In August 2006, the Company entered into a securities purchase agreement
in respect of an equity line of credit facility (ELOC) with Cityplatz Limited
(Cityplatz), that provides the Company up to $60,000,000 of funds in return
for the issuance of common shares at a discount of 3.0% to market price at the
time of draw downs over term, less a placement fee equal to 2.4% of gross
proceeds payable to the placement agent, Rodman & Renshaw, LLC. The ELOC
established by the securities purchase agreement will terminate on February 9,
2009. The ELOC shall also terminate if (i) the Company's common shares are
de-listed from NASDAQ unless the common shares are listed at such time on
another trading market specified in the agreement and such de-listing is in
connection with a subsequent listing on another trading market specified in
the agreement, (ii) the Company is subject to a change of control transaction
or (iii) the Company suffers a material adverse effect which cannot be cured
prior to the next drawdown notice. The Company may terminate the securities
purchase agreement (i) if Cityplatz fails to fund a properly notified drawdown
within five trading days of the end of the applicable settlement period or
(ii) after it has drawn down at least $25,000,000 under the ELOC. Either party
may also terminate the securities purchase agreement if the volume-weighted
average price of the Company's common shares is below $5 per share for more
than 30 consecutive trading days. Given that the current price per share has
been below the minimum price as per the agreement, the agreement may be
terminated at any time. As at December 31, 2007, the Company had not drawn any
funds under the ELOC. See subsequent event note for terms of amendment.
    "Restricted Cash" presented on the Consolidated Balance Sheet is composed
of short-term investments pledged to a bank as collateral for two letters of
credit; the first in the amount of $6,000,000 was issued in connection with
the potentially refundable upfront payment received under the collaboration
agreement with Centocor and the second in the amount of CDN$640,000 was
granted in favour of a landlord in relation to the lease of a building. As at
December 31, 2007, restricted cash is composed of third-party Asset-Backed
Commercial Paper (ABCP). These investments were due to mature during the
second quarter of 2007 but, as a result of a disruption in the credit markets,
particularly in the ABCP market, they did not settle on maturity and currently
remain outstanding. At the time these investments were acquired, the ABCP were
rated R1-high by Dominion Bond Rating Service, which is the highest credit
rating for this type of investment. The ABCP are currently subject to a
restructuring proposal under a standstill agreement which is expected to
result in the conversion of the ABCP into longer-term financial instruments
with maturities corresponding to the underlying assets. A Pan-Canadian
Investors Committee (the Committee) was established to oversee the orderly
restructuring of these instruments during this standstill period. A
restructuring plan was announced by the Committee on December 23, 2007, and is
anticipated to be completed by the end of March, 2008. During the quarter
ended December 31, 2007, the Company recorded a provision for losses in the
amount of $1,184,000 in respect of ABCP, reflecting the Company's estimated
reduction in the fair value of these investments as at December 31, 2007. The
Company estimated the fair value of the ABCP using a probability weighted
discounted cash flow approach, based on its best estimates of the time period
over which the assets are going to generate cash flows ranging from 7 to
30 years based on the proposed restructuring, the coupon interest rate, the
discount rate to apply to the net cash flows anticipated to be received
commensurate with highly rated notes and other qualitative factors. This
estimate of the fair value of the ABCP is not supported by observable market
prices or rates, therefore is subject to uncertainty, including, but not
limited to, the outcome of the restructuring plan being considered, the
estimated amounts to be recovered, the yield of the substitute financial
instruments and the timing of future cash flows. The resolution of these
uncertainties could be such that the ultimate fair value of these investments
may vary from the Company's current best estimate. Changes in the near term
could require changes in the recognized amount of these assets. The Company
does not expect there will be a material adverse impact on its business as a
result of the Third Party ABCP liquidity issue. During the third and
fourth quarter of 2007, both letters of credit were renewed upon their
respective annual expiry, with the ABCP issued as collateral.

    As at December 31, 2007, the Company's workforce comprised 170 employees.

    As at January 31, 2008, the Company had 48,848,095 common shares
outstanding, 220,000 common shares issuable to the Chief Executive Officer
upon the achievement of specified performance targets, 2,815,233 options
granted under the stock option plan, 2,884,471 shares currently issuable under
the convertible notes, and 2,250,645 warrants outstanding, for a total of
57,018,444 common shares, on a fully diluted basis.
    The Company believes that its available cash and short-term investments,
expected interest income, potential revenues from commercialization of
nutraceutical products, potential funding from partnerships, research
collaborations and licensing agreements, potential proceeds from the equity
line of credit facility, potential revenue from commercialization of
nutraceutical products, research tax credits, grants, and access to capital
markets should be sufficient to finance the Company's operations and capital
needs during the ensuing fiscal year. However, in light of the uncertainties
associated with the regulatory approval process, clinical trial results,
commercialization of nutraceutical products, and the Company's ability to
secure additional licensing, partnership and/or other agreements, further
financing may be required to support the Company's operations in the future.

    Change in functional and reporting currency

    Effective July 1, 2007, the Company adopted the US dollar as its
functional and reporting currency, as a significant portion of its revenues,
expenses, assets, liabilities and financing are denominated in US dollars.
Prior to that date, the Company's operations were measured in Canadian dollars
and the consolidated financial statements were expressed in Canadian dollars.
The Company followed the recommendations of the Emerging Issues Committee
(EIC) of the Canadian Institute of Chartered Accountants (CICA), set out in
EIC-130, "Translation method when the reporting currency differs from the
measurement currency or there is a change in the reporting currency". In
accordance with EIC-130, assets and liabilities as of June 30, 2007 were
translated in US dollars using the exchange rate in effect on that date;
revenues, expenses and cash flows were translated at the average rate in
effect during the six-month period ended June 30, 2007, and equity
transactions were translated at historical rates. For comparative purposes,
historical financial statements have been restated into US dollars using the
current rate method. Under this method, assets and liabilities are translated
at the closing rate in effect at the end of these periods, revenues, expenses
and cash flows are translated at the average rates in effect during these
periods and equity transactions are translated at historical rates. Any
exchange differences resulting from the translation are included in
accumulated other comprehensive income presented in shareholders' equity.

    Subsequent event

    On February 20, 2008, the Board of Directors approved the following
transactions:

    (a) The issuance of 2,445,000 options to purchase common shares to be
        issued under the stock option plan of the Company. The option price
        per share will be determined based on the weighted average trading
        price of common shares for the five days preceding the date of grant
        during which the common shares were traded on the Toronto Stock
        Exchange.

    (b) The Company renewed the management services agreement entered into
        with Picchio International Inc. to November 30, 2008.

    (c) The Company entered into an amendment with respect to the
        ELOC facility. The term of the ELOC facility has been extended to
        February 2010. The minimum draw-down obligation by the Company has
        been reduced to $15,000,000 over the term. The maximum amount of each
        monthly draw-down is limited to the lower of $6,000,000 or 12.5% of
        the volume-weighted price calculation of the common shares at the
        time of draw-down. The common shares will be issued at a discount of
        4.0% to market price if the volume-weighted average price (VWAP)
        per share is $6 or higher, and 7% if the VWAP per share is lower than
        $6 at the time of draw-down


                               Neurochem Inc.
                    Consolidated Financial Information(1)
             (in thousands of US dollars, except per share data)


                                     Three-month
                                    period ended              Year ended
                                     December 31              December 31
    -------------------------------------------------------------------------
    Consolidated Statements
     of Operations               2007         2006         2007         2006
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                           (unaudited)  (unaudited)

    Revenues:
      Collaboration
       agreement                 $206         $497       $1,119       $2,106
      Reimbursable costs           64          178          396          712
    -------------------------------------------------------------------------
                                  270          675        1,515        2,818
    -------------------------------------------------------------------------

    Expenses:
      Research and
       development             12,199       14,142       55,732       51,688
      Research tax credits
       and grants                (727)        (607)      (2,161)      (1,899)
      Other research and
       development charges          -            -            -        1,127
    -------------------------------------------------------------------------
                               11,472       13,535       53,571       50,916
      General and
       administrative           1,397        2,819       10,581       11,522
      Arbitral award                -            -            -        1,835
      Reimbursable costs           64          178          396          712
      Stock-based
       compensation             1,421          924        4,275        3,569
      Depreciation,
       amortization
       and patent cost
       write-off                  611          386        1,698        1,556
    -------------------------------------------------------------------------
                               14,965       17,842       70,521       70,110
    -------------------------------------------------------------------------
      Loss before
       undernoted items       (14,695)     (17,167)     (69,006)     (67,292)

      Interest income             756          574        3,341        2,077
      Interest and
       bank charges               (52)         (68)        (202)        (133)
      Accretion expense        (1,183)        (550)     (15,751)        (550)
      Change in fair
       value of embedded
       derivatives                 28            -         (870)           -
      Change in fair
       value of third
       party asset-backed
       commercial paper        (1,184)           -       (1,184)           -
      Foreign exchange
       gain (loss)                (54)         245        1,130         (280)
      Other income                 287         282        1,274        1,348
      Share of loss
       in a company
       subject to
       significant
       influence                    -         (489)        (327)      (2,440)
      Non-controlling
       interest                     -          162          109          801
    -------------------------------------------------------------------------
      Net loss               ($16,097)    ($17,011)    ($81,486)    ($66,469)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
      Net loss per share:
        Basic and diluted      ($0.33)      ($0.44)      ($1.85)      ($1.72)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

      Weighted average
       number of
       common shares
       outstanding         48,896,595   38,845,937   44,030,474   38,654,063
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


                                                             At           At
                                                    December 31  December 31
    Consolidated Balance Sheets                            2007         2006
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

      Cash, cash equivalents and marketable
       securities                                       $58,672      $48,758
      Other current assets                                3,933       10,460
    -------------------------------------------------------------------------
      Total current assets                               62,605       59,218
      Capital assets and patents                          9,996        8,992
      Other long-term assets                              5,830        3,192
    -------------------------------------------------------------------------
      Total assets                                      $78,431      $71,402
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

      Current liabilities                               $21,240      $22,377
      Long-term liabilities                              52,602       50,017
      Non-controlling interest                              680          725
      Shareholders' equity                                3,909       (1,717)
    -------------------------------------------------------------------------

      Total liabilities and shareholders' equity        $78,431      $71,402
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    (1) Condensed from the Company's unaudited quarterly consolidated
        financial statements and audited consolidated financial statements
        available on SEDAR and EDGAR.
    

    About Neurochem

    Neurochem Inc. is a global health company focused on the research,
development and commercialization of products to provide innovative health
solutions to address critical unmet medical needs.

    To Contact Neurochem

    For additional information on Neurochem and its drug development
programs, please call the North American toll-free number 1-877-680-4500 or
visit our Web Site at: www.neurochem.com.

    Certain statements contained in this news release, other than statements
of fact that are independently verifiable at the date hereof, may constitute
forward-looking statements. Such statements, based as they are on the current
expectations of management, inherently involve numerous risks and
uncertainties, known and unknown, many of which are beyond Neurochem Inc.'s
control. Such risks include but are not limited to: the impact of general
economic conditions, general conditions in the pharmaceutical and/or
nutraceutical industry, changes in the regulatory environment in the
jurisdictions in which the Neurochem group does business, stock market
volatility, fluctuations in costs, and changes to the competitive environment
due to consolidation, that actual results may vary once the final and
quality-controlled verification of data and analyses has been completed, as
well as other risks disclosed in public filings of Neurochem Inc.
Consequently, actual future results may differ materially from the anticipated
results expressed in the forward-looking statements. The reader should not
place undue reliance, if any, on any forward-looking statements included in
this news release. These statements speak only as of the date made and
Neurochem Inc. is under no obligation and disavows any intention to update or
revise such statements as a result of any event, circumstances or otherwise,
unless required by applicable legislation or regulation. Please see the Annual
Information Form of Neurochem Inc. for further risk factors that might affect
the Neurochem group and its business.




For further information:

For further information: Lise Hébert, Ph.D., Vice President, Corporate
Communications, (450) 680-4572, lhebert@neurochem.com


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