For the second quarter ended June 30, 2010, NeoPharm reported a net loss of $0.8 million, or ($0.03) per basic and diluted share, as compared to a net loss of $1.9 million, or ($0.07) per share, for the same period last year. For the six months ended June 30, 2009, NeoPharm reported a net loss of $2.2 million, or ($0.08) per basic and diluted share, compared to a net loss of $4.2 million, or ($0.15) per share, for the same period last year. The decrease in the Company's net loss for the three and six months ended June 30, 2010 is primarily due to a $0.7 gain on the reversal of all prior unrealized losses related to its investments in auction rate securities ("ARS"), and continued decreases in general and administrative expenses. On June 30, 2010, the Company exercised its put option and redeemed all of its ARS investments at full par value, reversing all previously recorded unrealized losses and repaying its ARS loan in full with the proceeds of this redemption. The Company's general and administrative expenses decreased $0.4 million and $0.7 million for the three and six months ended June 30, 2010 in connection with continuing cost-savings initiatives in this area.

During the second quarter, the Company's cash outlays decreased to $1.3 million as compared to $1.9 million for the first quarter of 2010. This decrease in cash outlays is primarily attributable to the effectiveness of cost-saving measures, however the Company expects future cash outlays to increase consistent with the advancement and progression of its clinical trials and other preclinical development activities. The Company had $1.8 million in cash and cash equivalents as of June 30 2010, and projects that it has adequate resources to fund its operations into the fourth quarter of 2010. The Company is currently exploring various alternatives to continue its operations for the rest of 2010 and beyond, but no assurance can be given that such efforts will be successful.

SOURCE NeoPharm, Inc.