Auxilium Pharmaceuticals, Inc. Announces Second Quarter 2008 Financial Results and Operational Highlights

MALVERN, PA, Jul 31 (MARKET WIRE) --
Auxilium Pharmaceuticals, Inc. (NASDAQ: AUXL), a specialty
biopharmaceutical company, today announced financial results and
operational highlights for the quarter ended June 30, 2008. For the
second quarter of 2008, Auxilium reported net revenues of $30.9 million
compared to net revenues of $23.3 million in the second quarter of 2007.

"I'm extremely proud of our accomplishments in the second quarter. We
believe that the positive CORD I and II clinical trial results demonstrate
that XIAFLEX(TM) has the potential to revolutionize the treatment of
Dupuytren's contracture. For the remainder of 2008, we intend to focus on
completing the clinical follow-up required in our on-going phase III
studies and preparing for submission of a Biologics License Application
for XIAFLEX for this indication, which we expect to achieve in early
2009," said Armando Anido, Chief Executive Officer and President of
Auxilium. "Additionally, in the second quarter, Testim continued to
demonstrate strong growth in sales, market share and prescription demand.
The Auxilium team has delivered another quarter of outstanding results
and I'd like to congratulate all of our employees who contributed to our
success."

Second Quarter Operational Highlights:

XIAFLEX:

-- In June, Auxilium announced positive top-line efficacy and safety
results from its CORD I and II phase III clinical trials for XIAFLEX in the
treatment of Dupuytren's contracture. Sixty-four percent of patients in
the pivotal CORD I trial successfully met the primary endpoint, a reduction
in the angle of the patient's primary joint contracture to less than or
equal to 5 degrees of normal, as measured by digital goniometry, 30 days
after the last injection. By comparison only 6.8% of patients who were
randomized to placebo achieved this endpoint (p < 0.001).
-- The Company also announced in June that its 16 patient pharmacokinetic
study demonstrated that XIAFLEX does not result in systemic exposure, since
no measurable levels of XIAFLEX were detected in patients' plasma from 5
minutes through 30 days after injection of XIAFLEX into a Dupuytren's cord.
-- Auxilium signed a supply agreement with Hollister-Stier Laboratories
LLC to provide fill-finish capabilities for commercial batches of XIAFLEX.
-- The Company received feedback from the U.S. Food and Drug
Administration (FDA) on the phase IIb trial protocol for XIAFLEX in
Peyronie's disease and expects to dose the first patient in the third
quarter of 2008.
-- Auxilium also received a written communication from the FDA that
confirmed that XIAFLEX material manufactured in the Company's Horsham
facility is considered to be comparable to the material produced by the
Company's former development partner, Cobra Biomanufacturing Ltd. XIAFLEX
material manufactured by Cobra was used in the double-blind stage of the
CORD I and II clinical trials.

TESTIM:

-- According to IMS, 129,000 total prescriptions for Testim, which was
the Company's highest quarterly level, were dispensed in the second quarter
of 2008, representing a 26.0% growth over the second quarter of 2007.
-- Testim ended the month of June with a 21.9% share of total
prescriptions for testosterone gels, up from 19.7% at the end of June 2007,
according to IMS.
-- Total prescriptions within the gel segment of the testosterone
replacement therapy market in the U.S. grew 13.1% versus the second quarter
of 2007, according to IMS.
-- Auxilium continues to enroll patients in its Testim registry in the
U.S. (TRiUS) to evaluate short and long term outcomes of testosterone
replacement therapy.

FENTANYL TRANSMUCOSAL FILM:

-- The Company initiated a phase I pharmacokinetic study of Fentanyl for
pain management using its in-licensed and patented transmucosal film
delivery system.

COMPANY HIGHLIGHTS:

-- The Company has been nominated again by The Philadelphia Business
Journal as one of the "10 Best Places to Work" in the greater Philadelphia
area.

-- Dr. Wayne Herber joined the Company in the newly created position of
Vice President, Process Development. Dr. Herber has over 20 years of
experience in the biological process sciences area primarily at Merck in
the vaccines division. Dr. Herber has a PhD in microbiology from Rutgers
University. His years of experience have included process development,
technology transfer, analytical development and formulation development.

Second Quarter 2008 Financial Results:

For the quarter ended June 30, 2008, Auxilium reported net revenues of
$30.9 million compared to net revenues of $23.3 million in the second
quarter of 2007. Total Testim units sold to our customers exceeded Testim
units estimated by IMS on a prescription basis during the second quarter
of 2008. We estimate that this resulted in incremental sales during the
quarter of approximately $0.8 million in net revenues. Shipments of Testim
to our ex-U.S. partners in the second quarter of 2008 were $0.4 million,
compared to $0.6 million of shipments to these partners in the second
quarter of 2007. The net loss for the second quarter of 2008 was $11.7
million, or $(0.29) per share, compared to a net loss of $10.0 million, or
$(0.27) per share, reported for the second quarter of 2007. Net loss for
the second quarter of 2008 includes total stock-based compensation expense
of $2.8 million, compared to $1.5 million for the second quarter of 2007.

Gross margin on net revenues was 76.0% for the quarter ended June 30, 2008
compared to 74.8% for the comparable period in 2007. Gross margin reflects
the cost of product sold as well as royalty payments made to the Company's
licensor on the sales of Testim. The increase in the gross margin rate
reflects the impact of year-over-year price increases on U.S. Testim
revenues, and the decline in lower margin international product shipments.

Research and development spending for the quarter ended June 30, 2008 was
$13.4 million, compared to $9.7 million for 2007. The increase in
research and development costs was primarily due to increased spending for
clinical development of XIAFLEX and preparing for the BLA filing through
headcount additions.

Selling, general and administrative expenses totaled $22.2 million for the
quarter ended June 30, 2008 compared with $18.5 million for the year-ago
quarter. The increase was primarily due to higher investment in
promotional spending for Testim, pre-launch investments for XIAFLEX, and
higher stock-based compensation expense.

As of June 30, 2008, Auxilium had $48.8 million in cash and cash
equivalents compared to $56.9 million on March 31, 2008.

Conference Call

Auxilium will hold a conference call today, July 31, 2008 at 10:00 a.m.
EDT, to discuss second quarter 2008 financial results and operational
highlights. The conference call will be simultaneously web cast on
Auxilium's web site and archived for future review until August 31, 2008.

Conference call details:
Date: Thursday, July 31, 2008
Time: 10:00 a.m. EDT
Dial-in (U.S.): 866-831-6243
Dial-in (International): 617-213-8855
Web cast: http://www.auxilium.com
Passcode: Auxilium

To access an audio replay of the call:
Access number (U.S.): 888-286-8010
Access number (International): 617-801-6888
Replay Passcode #: 19700927

About Auxilium

Auxilium Pharmaceuticals, Inc. is a specialty biopharmaceutical company
with a focus on developing and marketing to urologists, endocrinologists,
orthopedists and select primary care physicians. Auxilium markets
Testim(R) 1%, a topical testosterone gel, for the treatment of
hypogonadism through its approximately 190-person sales and marketing
team. Auxilium has five projects in clinical development. XIAFLEX(TM)
(clostridial collagenase for injection), formerly referred to as AA4500,
is in phase III of development for the treatment of Dupuytren's
contracture and is in phase II of development for the treatment of
Peyronie's disease and Frozen Shoulder syndrome (Adhesive Capsulitis).
Auxilium's transmucosal film product candidate for the treatment of
overactive bladder (AA4010) is in phase I of development. The Company is
currently seeking a partner to further develop this product candidate.
Auxilium also has one pain product using its transmucosal film delivery
system in phase I of development. Auxilium has rights to seven additional
pain products and products for hormone replacement and urologic disease
using its transmucosal film delivery system. Auxilium also has options to
all indications using XIAFLEX for non-topical formulations. For
additional information, visit http://www.auxilium.com.

SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT
OF 1995

In addition to historical facts or statements of current condition, this
release contains forward-looking statements within the meaning of the
"Safe Harbor" provisions of The Private Securities Litigation Reform Act
of 1995, including statements regarding:

-- the commencement of a phase IIb clinical study for XIAFLEX for the
treatment of Peyronie's disease;
-- the timing of the filing of a Biologics License Application with the
U.S. Food and Drug Administration for XIAFLEX for the treatment of
Dupuytren's contracture;
-- the interpretation of clinical results;
-- the potential for XIAFLEX to revolutionize the treatment of
Dupuytren's contracture.

Forward-looking statements often address Auxilium's expected future
financial position, prospects or business strategy and plans and
objectives of management for future operations, and often contain the
words "believe," "may," "could," "will," "estimate," "continue,"
"anticipate," "intend," "should," "plan," "expect," and "potentially,"
and similar expressions. Forward-looking statements provide Auxilium's
current expectations or forecasts of future events. Auxilium's
performance and financial results could differ materially from those
reflected in these forward-looking statements due to:

-- the success of research and development activities;
-- the performance of third-party manufacturers and suppliers;
-- decisions by regulatory authorities as to whether and when to approve
drug applications;
-- decisions by regulatory authorities as to whether and when to proceed
to the next phase of clinical trials;
-- difficulties or delays in manufacturing;
-- competition from currently marketed products, generic products, and
new products;
-- legislative and regulatory action in the jurisdictions in which
Auxilium markets or seeks to market its products;
-- claims and concerns that may arise regarding the safety or efficacy of
its products; and
-- increase in costs or expenses.

A more detailed list and description of the risks and uncertainties
that Auxilium faces may be found under the heading "Risk Factors" in
Auxilium's Annual Report on Form 10-K for the year ended December 31,
2007 which is on file with the Securities and Exchange Commission. Given
these risks and uncertainties, any or all of the forward-looking
statements contained in this release may prove to be incorrect.
Therefore, you should not rely on any such factors or forward-looking
statements. Auxilium undertakes no obligation to update publicly any
forward-looking statement.

AUXILIUM PHARMACEUTICALS, INC.
Condensed Consolidated Statement of Operations
(In thousands, except share and per share amounts)
(Unaudited)

Three Months Ended Six Months Ended
June 30, June 30,
---------------------- ----------------------
2008 2007 2008 2007
---------- ---------- ---------- ----------
Net revenues $ 30,901 $ 23,340 $ 58,019 $ 41,760
---------- ---------- ---------- ----------
Operating expenses:
Cost of goods sold 7,409 5,872 13,409 10,950
Research and
development* 13,435 9,711 26,628 18,422
Selling, general and
administrative* 22,173 18,503 43,193 35,709
---------- ---------- ---------- ----------
Total operating
expenses 43,017 34,086 83,230 65,081
---------- ---------- ---------- ----------
Loss from operations (12,116) (10,746) (25,211) (23,321)
Interest income (expense),
net 390 724 1,171 1,426
Other income (expense), net - - - (3)
---------- ---------- ---------- ----------

Net loss $ (11,726) $ (10,022) $ (24,040) $ (21,898)
========== ========== ========== ==========
Basic and diluted net loss
per common share $ (0.29) $ (0.27) $ (0.59) $ (0.60)
========== ========== ========== ==========
Weighted average common
shares outstanding 41,050,599 36,724,292 40,888,477 36,253,591
========== ========== ========== ==========

*includes the following
amounts of stock-based
compensation expense:
Research and development $ 648 $ 272 $ 1,164 $ 494
Selling, general and
administrative 2,128 1,187 3,725 2,146

AUXILIUM PHARMACEUTICALS, INC.
Selected Consolidated Balance Sheet Data
(In thousands)
(Unaudited)

June 30, December 31,
2008 2007
-------------- --------------
Cash and cash equivalents $ 48,822 $ 70,290
Short-term investments - 5,800
Working capital 38,138 64,861
Long-term investments 3,940 -
Total assets 94,857 106,979
Other long-term liabilities 10,985 11,166
Total stockholders' equity 47,633 64,016

For More Information, Contact:

James E. Fickenscher
CFO
Auxilium Pharmaceuticals, Inc.
(484) 321-5900
Email Contact

William Q. Sargent Jr.
VP IR
Auxilium Pharmaceuticals, Inc.
(484) 321-5900
Email Contact

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