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NuPathe Announces Third Quarter 2012 Financial Results and Operational Highlights

CONSHOHOCKEN, PA -- (Marketwire) -- 11/12/12 -- NuPathe Inc. (NASDAQ: PATH), a specialty pharmaceutical company focused on the development and commercialization of branded therapeutics for diseases of the central nervous system, today announced financial results for the quarter ended September 30, 2012, and recent operational highlights.

"The acceptance of our New Drug Application for Zecuity™ and the completion of our $28 million capital raise were important achievements for the company," said Armando Anido, chief executive officer of NuPathe. "We now have the financial resources to achieve our key objectives: to obtain approval for Zecuity, to secure commercial partners, and to conduct additional pre-launch activities for this valuable new migraine treatment."

Quarterly and Recent Highlights

  • In July, NuPathe's New Drug Application (NDA) resubmission for its migraine patch, Zecuity (formerly known as NP101 and Zelrix), was accepted for filing by the U.S. Food and Drug Administration (FDA) and received a Prescription Drug User Fee Act (PDUFA) date of January 17, 2013, which is the target date for the FDA to complete its review of the NDA.
  • In July, Armando Anido was appointed chief executive officer and a member of NuPathe's board of directors. Mr. Anido has more than 30 years of executive, operational and commercial leadership experience in the biopharmaceutical industry. Most recently, he served as president and CEO of Auxilium Pharmaceuticals (NASDAQ: AUXL), where under his leadership, sales grew from $42 million in 2005 to more than $260 million in 2011 and market capitalization increased from $200 million to more than $900 million.
  • In August and September, NuPathe entered into two separate modifications to its Term Loan Facility, which, among other things, reduced the minimum unrestricted cash balance that the Company is required to maintain from $3 million to $1 million, and temporarily reduced the monthly principal payments due under the Term Loan Facility to $0.23 million through June 30, 2013, after which the principal balance will amortize straight-line through June 2014.
  • In October, NuPathe completed the sale of $28 million of securities resulting in approximately $26.3 million of net proceeds. The securities were sold as units, each consisting of 1/1,000th of a share of newly designated Series A preferred stock and a warrant to purchase one share of the Company's common stock. The purchase price per unit was $2.00.
  • In conjunction with the financing, James A. Datin, Executive Vice President and Managing Director, and Brian J. Sisko, Senior Vice President and General Counsel, both from Safeguard Scientifics, Inc. (NYSE: SFE), along with Richard S. Kollender, Partner at Quaker Partners Management, L.P., were appointed to NuPathe's board of directors. Jeanne Cunicelli, Investment Partner at Bay City Capital LLC, and Dr. Gary Kurtzman, Senior Vice President and Managing Director at Safeguard, resigned from the board.
  • Also in conjunction with the financing, NuPathe undertook cost containment measures to focus its expenditures on obtaining FDA approval of Zecuity, securing commercial partners and conducting additional pre-launch activities.

Third Quarter 2012 Financial Results
NuPathe reported a net loss of $6.2 million for the third quarter of 2012, compared with a net loss of $7.4 million for the third quarter of 2011.

Research and development expenses were $2.2 million in the third quarter of 2012, compared with $3.9 million in the third quarter of 2011. The decrease was largely attributable to reduced spending related to Zecuity, NP201 and NP202 during the 2012 period, combined with the fact that the 2011 period included higher CMC expenses related to the purchase and manufacture of clinical supplies for Zecuity. Selling, general and administrative expenses were $3.5 million in the third quarter of 2012, compared with $3.0 million for the same period in 2011. The increase was primarily attributable to separation expenses accrued in conjunction with the resignation of the former CEO as well as the elimination of 15 full-time equivalent positions announced in September, partially offset by curtailed activities in the area of commercial operations.

Net cash used in operating activities for the nine months ended September 30, 2012, was $15.1 million, primarily the result of spending for normal operating activities and development and regulatory expenses for the preparation of the resubmission of the NDA for Zecuity. During this period NuPathe also used $0.3 million of cash in investing activities as well as $6.4 million of cash for financing activities primarily related to contractual debt repayments. During the nine months ended September 30, 2011, NuPathe used $14.7 million for operating activities as well as $3.5 million for investing activities for the funding of commercial manufacturing equipment for the migraine patch. Additionally, during the 2011 period NuPathe received net proceeds of $9.3 million from financing activities, primarily from proceeds received under the Company's credit facility, offset partially by scheduled debt repayments.

As of September 30, 2012, NuPathe had $1.3 million in cash and cash equivalents and a working capital deficit of $7.6 million, compared with $23.1 million in cash and cash equivalents and working capital of $11.0 million as of December 31, 2011. Management estimates that the Company's current cash and cash equivalents as of September 30, 2012, plus the approximately $26.3 million in net proceeds from the October 2012 financing discussed above, will be sufficient to fund operations, debt service and interest obligations into the fourth quarter of 2013.

Company to Host Conference Call
NuPathe will host a conference call today, November 12, 2012, at 8:30 a.m. EST to discuss the Company's financial results for the quarter ended September 30, 2012, and recent operational highlights. A question and answer session will follow NuPathe's remarks. To participate on the live call, please dial 888-359-3627 (domestic) or +1-719-457-2727 (international), and provide the participant passcode 8657634, approximately 10 minutes ahead of the start of the call. A replay of the call will be available for 90 days within a few hours after the call ends and can be accessed by dialing 888-203-1112 (domestic) or +1-719-457-0820 (international), with the passcode 8657634.

A live audio webcast of the call will be available via the "Investor Relations" page of the NuPathe website, www.nupathe.com. Please log on through NuPathe's website approximately 10 minutes prior to the scheduled start time. A replay of the webcast will also be archived on the Company's website for 90 days following the call.

About Zecuity
Zecuity is an active, single-use, transdermal patch in development for the treatment of migraine. If approved, it will be the first transdermal patch for the treatment of migraine. The patch actively delivers sumatriptan, the most widely prescribed migraine medication. In three clinical trials involving more than 10,000 applications, Zecuity offered patients fast onset and sustained relief of debilitating migraine symptoms including headache pain and migraine-related nausea (MRN) and vomiting. Because Zecuity delivers sumatriptan transdermally, it may be an attractive treatment option for many frequent MRN sufferers and those patients who experience gastroparesis, a slowing of gastric absorption. The patch utilizes SmartRelief™, NuPathe's proprietary transdermal delivery technology that allows the rapid yet tightly controlled transport of medication through the skin using a process called iontophoresis. As a result, in Zecuity clinical trials there was a low incidence of triptan sensations that include chest tightness, flushing and feelings of pressure and numbness.

About Migraine and Migraine-Related Nausea and Vomiting
Migraine is a neurological disorder that affects approximately 30 million adults in the U.S.(1) In addition to a headache pain, most migraine patients suffer from one or more significant gastrointestinal problems, including nausea, vomiting, and gastroparesis. Approximately eight million diagnosed migraine sufferers experience MRN in greater than 50 percent of their migraines.(2) These frequent-MRN sufferers are less likely to achieve headache relief with oral triptans(2,3) and are less satisfied with their current migraine medications.(4) They experience more medication-related interference in several aspects of life, including their ability to work and spend time with family.(4) These patients also generate increased direct medical costs as a result of their five-fold increase in emergency room and urgent care visits and eight-fold increase in overnight hospital stay costs.(5) In addition, approximately 3.4 million diagnosed migraine patients vomit during a majority of their migraines, while approximately 1.5 million patients vomit during every migraine.(1,6) Some migraine patients also experience gastroparesis, which may affect a patient's response to oral medications.(7)

About NuPathe
NuPathe Inc. is a specialty pharmaceutical company focused on innovative neuroscience solutions for diseases of the central nervous system including neurological and psychiatric disorders. NuPathe's lead product candidate, Zecuity™ (previously referred to as Zelrix or NP101) is an active, single-use, transdermal sumatriptan patch being developed for the treatment of migraine. In addition to Zecuity, NuPathe has two proprietary product candidates based on its LAD™, or Long-Acting Delivery, biodegradable implant technology that allows delivery of therapeutic levels of medication over a period of months with a single dose. NP201, for the continuous symptomatic treatment of Parkinson's disease, utilizes a leading FDA-approved dopamine agonist, ropinirole, and is being developed to provide up to two months of continuous delivery. NP202, for the long-term treatment of schizophrenia and bipolar disorder, is being developed to address the long-standing problem of patient noncompliance by providing three months of continuous delivery of risperidone, an atypical antipsychotic. NuPathe is actively seeking partnerships to maximize the commercial potential for its product candidates in the U.S. and territories throughout the world.

For more information about NuPathe, please visit our website and our blog at www.nupathe.com. You can also follow us on StockTwits (stocktwits.nupathe.com), Twitter (twitter.nupathe.com), SlideShare (slideshare.nupathe.com) and LinkedIn (linkedin.nupathe.com).

Cautionary Note Regarding Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. All statements that are not historical facts are hereby identified as forward-looking statements for this purpose and include, among others, statements relating to: timing of the completion of the FDA's review of our NDA for Zecuity; the approval and launch of Zecuity; pre-launch activities for Zecuity; partnering plans for our product candidates; the potential benefits of, and commercial opportunity for, our product candidates; the sufficiency of our cash and cash equivalents to fund debt service and interest obligations and continue operations into the fourth quarter of 2013; and other statements relating to our plans, objectives, expectations and beliefs regarding our future operations, performance or financial condition and other future events.

Forward-looking statements are based upon our current expectations, plans and beliefs and are subject to a number of risks, uncertainties, assumptions and other factors that could cause actual results and events to differ materially and adversely from those indicated by such statements including, among others: our ability to obtain FDA approval of Zecuity; the extent to which the FDA may request or require additional information, studies or redesign of Zecuity and the costs and time required to complete such activities; our ability to obtain partners for our product candidates; our ability to obtain additional capital on a timely basis and on agreeable terms to continue as a going concern; varying interpretation of trial, study and market data; and the other factors discussed in our Annual Report on Form 10-K for the year ended December 31, 2011 and in our Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2012, under the caption "Risk Factors" and elsewhere in such reports, which are available on our website at www.nupathe.com in the "Investor Relations -- SEC Filings" section. While we may update certain forward-looking statements and Risk factors from time to time, we specifically disclaims any obligation to do so, whether as a result of new information, future developments or otherwise. You are cautioned not to place undue reliance on any forward-looking statements.


(1.) Lipton, R. Prevalence and Burden of Migraine in the United States: Data from the American Migraine Study II. Headache 2001 41:646-657 and US Census data (2010).
(2.) Diener et al. Predicting the response to sumatriptan, the sumatriptan naratriptan aggregate database. Neurology 2004;63:520-524.
(3.) Diener et al. Identification of negative predictors of pain-free response to triptans: analysis of the eletriptan database. Cephalalgia 2007, 28, 35-40.
(4.) Lipton, R. Data presented at the 53rd Annual Scientific Meeting of the American Headache Society (AHS), June 2011.
(5.) Lipton et al. Data presented at the Academy of Managed Care Pharmacy's 2011 Educational Conference, October 2011.
(6.) Silberstein, S. Migraine symptoms: results of a survey of self-reported migraineurs. Headache 1995;35:387-396.
(7.) Ferrari et al. Oral triptans (serotonin 5-HT1B/1D agonists) in acute migraine treatment: a meta-analysis of 53 trials. Lancet 2001; 358: 1668-75.

                                NUPATHE INC.
                       (A Development-Stage Company)
                          Statements of Operations
             (In thousands, except share and per share amounts)

                         Three Months Ended           Nine Months Ended
                            September 30,               September 30,
                     --------------------------  --------------------------
                         2012          2011          2012          2011
                     ------------  ------------  ------------  ------------
Operating expenses:
  Research and
   development       $      2,220  $      3,927  $      9,033  $      9,204
  Selling, general
   administrative           3,525         3,010         8,332         7,510
                     ------------  ------------  ------------  ------------
    Total operating
     expenses               5,745         6,937        17,365        16,714
                     ------------  ------------  ------------  ------------
Loss from operations       (5,745)       (6,937)      (17,365)      (16,714)
  Interest income               2            17            17            58
  Interest expense           (446)         (522)       (1,293)         (974)
                     ------------  ------------  ------------  ------------
Net loss             $     (6,189) $     (7,442) $    (18,641) $    (17,630)
                     ============  ============  ============  ============
Basic and diluted
 net loss per common
 share               $      (0.42) $      (0.51) $      (1.26) $      (1.21)
                     ============  ============  ============  ============

Weighted average
 basic and diluted
 common shares
 outstanding           14,752,214    14,670,247    14,740,578    14,595,598
                     ============  ============  ============  ============

                                NUPATHE INC.
                        (A Development-Stage Company)
                             Balance Sheet Data
                               (In thousands)

                                               September 30,   December 31,
                                                   2012            2011
                                              --------------  --------------

Cash and cash equivalents                     $        1,277  $       23,059
Working capital (deficit)                             (7,614)         10,995
Total assets                                           9,702          30,849
Long-term debt                                         4,100           5,481
Total stockholders' equity (deficit)                  (4,169)         12,971

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