Oslo/Amersham, October 31, 2002

Nutri Pharma ASA (OSE: NUT) today announced that as a result of its JV with Nycomed Pharma revenues grew by 226% from NOK 12.4 million as of September 30 2001 to NOK 40.5 million in the same period 2002 while the operating result has improved from NOK –98.2 million to NOK –58.5 million.

EXECUTIVE SUMMARY

• The first nine months of 2002 has showed improvements in both revenues and expenses.
• Excluding Nutrition Partners operating expenses declined by 38% vs the same period 2001 as a result of the cost reduction program which is under implementation.
• Pre tax result for the first nine months of 2002 was negative NOK 47.4 million compared to negative NOK 76.5 million in the corresponding period last year.
• Total revenues for the first nine months of 2002 ended at NOK 40.5 million versus NOK 12.4 million in the same period 2001. These revenues include a pro-rata consolidation of 50 % of the revenues from Nutrition Partners, a JV with Nycomed Pharma. Pro-forma excluding Nutrition Partners’ revenues, Nutri Pharma's revenues declined by 11% to NOK 11.0 million.
• Net finance was NOK 11.0 million, compared to NOK 21.7 million in the corresponding period 2001.
• Total assets at the end of September 2002 were NOK 271.8 million of which NOK 227.5 million is cash, cash equivalents and certificates. The reduction in cash from NOK 283 million at year-end 2001 is mainly due to the losses in the first nine months of 2002 and reduction in payables.
• Nutri Pharma has filed a response to the European Patent Office (EPO) opposition. This is now part of the ordinary process within the EPO.
• Graham Waters, CEO, has announced his resignation. He is currently on sick leave. Eirik Uboe, CFO has been appointed interim Chief Operating Officer.

ROYALTIES/NET SALES REVENUES
Royalty income and sales revenues are mainly based on royalties and sales from the weight reduction and control products Nutrilett“, Scan Diet‘ and Nutri Plan‘ marketed and sold in the Nordic Area, North America and Australia/New Zealand.
In the North American market Nutri Pharma has a royalty based licence agreement with GNC. A similar agreement exists in Australia/New Zealand with Mayne Health.
Net sales revenues are 50% of the net sales from Nutrition Partners, the 50/50 JV with Nycomed Pharma, which serves the Nordic markets.

OPERATING COSTS
Operating costs in the first nine months of 2002 were 10% below the same period in 2001. Excluding the pro-rata consolidation of 50% of the expenses of Nutrition Partners, operating expenses declined by 38%.

MARKET DEVELOPMENT
Scan Diet™ marketed by GNC in the United States has not performed as expected this year. As of September 2002, sales are down 14% compared to the same period 2001. Although a key strategic brand for GNC, internal restrictions have reduced the brand’s exposure to the consumer resulting in a sales level below last year. GNC has “re-launched” its retail outlets in October and invested heavily in marketing and PR. It is too early to tell what the impact will be on the sale of Scan Diet™. In Australia, Nutriplan™ bars and “value” tubs have been launched in all major channels in Q3. Nutriplan™ powder (sachets and tubs) and bars were successfully launched in New Zealand in October. The weight-loss brand Nutrilett has benefit from both range extensions and geographic expansion in the Nordic Region during the first half of 2002. This has resulted in significant sales growth as a result of significant marketing investment.

R&D
Research expenditures will be further reduced going forward. Nutri Pharma has reached most of its research objectives which provides the company with substantial scientific data to support its patents and products. The main focus going forward will be on new product development in addition to implementing a strategy to effectively communicate to health professionals and consumers the significant health benefits demonstrated through our clinical development programme. Nutri Pharma continues to have the best-documented products in weight and cholesterol management.

INTELLECTUAL PROPERTY (IP)
Nutri Pharma has continued to build up a strong IP position. The patents protect and reinforce the USP of the Nutrilett®, ScanDiet™ and Nutri Plan‘ product ranges as well as Abacor® and Abalon® in both the North American, European and other international markets. The portfolio of patent families and patent claims will be consolidated going forward.
An opposition was filed against the EPO in Q4 2001 for granting Nutri Pharma a European patent. Nutri Pharma will vigorously defend this patent and Nutri Pharma has filed a response to the EPO opposition. This opposition is now part of the ordinary process within the EPO.

BUSINESS OUTLOOK
Based on Nutri Pharma’s strong clinical data and patent position, the Board is optimistic about the growth opportunities and still target break-even during 2003. The company’s products have been introduced in several markets and the key focus going forward will be on further commercialisation of its products and technology.

DOWNLOADS: The complete Q3 2002 Word file and PowerPoint presentation can be downloaded from the INVESTOR page.

Upcoming financial events 2002
 
February 5, 2003  Presentation of 4th quarter 2002
  
For further information, please contact
Eirik Uboe, CFO  +44 7766 051466