NitroMed Announces Agreement to Sell BiDil(R) Drug Business to JHP Pharmaceuticals,...

NitroMed Announces Agreement to Sell BiDil(R) Drug Business to JHP Pharmaceuticals, LLC

-- NTMD Reports Financial Results for Third Fiscal Quarter 2008 --

-- Conference Call and Webcast to be Held Today at 10:00 AM ET--
LEXINGTON, Mass.--(Business Wire)--
NitroMed, Inc. (NASDAQ:NTMD) today announced that JHP
Pharmaceuticals, LLC, a privately held specialty pharmaceutical
company, has agreed to acquire substantially all of the assets related
to NitroMed's BiDil(R) drug business. The purchase and sale agreement
between the companies provides that NitroMed will receive
consideration of $24.5 million in cash, subject to an accounts
receivable adjustment, plus up to an additional $1.8 million for
closing date inventory. JHP will assume all but specified liabilities
related to the transferred assets. BiDil (isosorbide
dinitrate/hydralazine hydrochloride) is an orally-administered
medicine approved in the United States for the treatment of heart
failure in self-identified black patients as an adjunct to current
standard therapies.

Closing Conditions and Stockholder Approval

The asset sale transaction is subject to specified closing
conditions, including: that NitroMed's stockholders approve the
transaction; that regulatory and other consents are obtained from
third parties; and other customary closing conditions. The obligation
of JHP to complete the transaction is also subject to the absence of
changes or circumstances that are materially adverse to the business,
financial condition or results of operations of the BiDil drug
business as a whole or that materially impair the ability of NitroMed
to complete the transaction. NitroMed's obligation to complete the
asset sale is subject to the absence of a material adverse effect on
the ability of JHP to complete the purchase of the assets.

NitroMed and JHP currently expect to complete the transaction in
early 2009.

The transaction must be approved by a majority of the holders of
NitroMed's outstanding common stock. To that end, and as described
further below, NitroMed expects to hold a special meeting of
stockholders and in connection therewith to mail to its stockholders a
proxy statement that will provide additional information concerning
the transaction.

Certain funds affiliated with HealthCare Ventures LLC, Rho
Ventures and Invus Public Equities, L.P., together owning or
controlling an aggregate of approximately 28% of NitroMed's common
stock, have agreed with JHP to vote their shares in favor of the
transaction.

"We're pleased to have signed a deal to sell the BiDil drug
business with a well-positioned firm like JHP Pharmaceuticals. As
previously announced, Cowen and Company acted and continues to serve
as our exclusive financial advisor and we believe that this deal
represents an important step in maximizing shareholder value.
NitroMed's activities after the transaction will continue to be
focused on seeking to maximize shareholder value by combining, through
one or more strategic transactions, with companies that have
significant unrealized value or growth potential," said Kenneth M.
Bate, NitroMed's President, Chief Executive Officer and interim Chief
Financial Officer.

NitroMed's strategic alternatives may also involve the divestiture
of some or all of its business. If the company is unable to
successfully consummate one or more of such strategic alternatives, it
may be required to cease its operations.

Important Additional Information about the Asset Sale will be
filed with the SEC

NitroMed plans to file with the U.S. Securities and Exchange
Commission (SEC) and mail to its stockholders a proxy statement in
connection with the transaction. The proxy statement will contain
important information about NitroMed and related matters. Investors
and security holders are urged to read the proxy statement carefully
when it is available.

Investors and security holders will be able to obtain free copies
of the proxy statement and other documents filed with the SEC by
NitroMed through the web site maintained by the SEC at www.sec.gov. In
addition, investors and security holders will be able to obtain free
copies of the proxy statement from NitroMed by contacting NitroMed,
Inc., Attn: Secretary, 45 Hayden Avenue, Suite 3000, Lexington, MA
02421.

NitroMed, and its directors and executive officers, may be deemed
to be participants in the solicitation of proxies in respect of the
transaction contemplated by the asset sale agreement. Information
regarding NitroMed's directors and executive officers is contained in
NitroMed's Annual Report on Form 10-K for the year ended December 31,
2007 and its proxy statement dated April 16, 2008, which are filed
with the SEC. As of September 30, 2008, NitroMed's directors and
executive officers beneficially owned approximately 30,927,803 shares,
or approximately 33%, of NitroMed's common stock.

Financial Results for Third Fiscal Quarter 2008

NitroMed also reported today its financial results for the three
quarter and nine months ended September 30, 2008.

Total revenues for the three months ended September 30, 2008 were
$4.0 million, compared to $3.8 million for the same period in 2007, an
increase of $0.2 million, or 6%. For the nine months ended September
30, 2008, total revenues were $11.8 million, compared to $11.0 million
for the same period in 2007, an increase of $0.8 million, or 7%. Sales
of BiDil accounted for all revenues during both periods.

Total operating expenses for the three months ended September 30,
2008, excluding cost of product sales, were $3.0 million, compared to
$11.9 million for the same period in 2007, a decrease of $8.9 million,
or 75%. For the nine months ended September 30, 2008, total operating
expenses, excluding cost of product sales, were $13.8 million,
compared to $34.5 million for the same period in 2007, a decrease of
$20.7 million, or 60%. The decrease in operating expenses for both
periods is primarily due to the company's January 2008 restructuring.

The company's net loss for the quarter ended September 30, 2008
was $0.4 million, or $0.01 per common share, compared to a net loss of
$8.4 million, or $0.18 per common share, for the same period in 2007.
For the nine months ended September 30, 2008, the company's net loss
was $4.6 million, or $0.10 per common share, compared to a net loss of
$24.7 million, or $0.60 per common share, for the same period in 2007.

At September 30, 2008, the company had cash, cash equivalents and
short-term marketable securities totaling $17.8 million, which
excludes $1.6 million of securities classified as long-term marketable
securities.

"These quarterly results continue to reflect generally steady
BiDil sales although active promotional efforts related to BiDil were
discontinued at the beginning of the year. During the third quarter,
we again carefully managed expenses following our January 2008
restructuring," Mr. Bate said. "For the year ending December 31, 2008,
we expect to incur approximately $14 to $16 million in operating
expenses, including share-based compensation expense related to SFAS
123R but excluding cost of product sales and charges related to our
January 2008 restructuring."

Webcast and Conference Call

NitroMed will host a webcast and conference call, including an
open question and answer session today, October 23, 2008, at 10:00 AM
ET to discuss the planned sale of the BiDil drug business and the
company's third and year to date quarter 2008 financial results,
progress and strategies. Callers may access the conference call as
follows:

Domestic callers: 800-260-8140.

International callers: 617-614-3672.

Participant passcode: 39918731. The call may also be accessed by
webcast at www.nitromed.com.

An audio replay of the conference call will be available two hours
after the call and through November 23, 2008. The replay can be
accessed by dialing 888-286-8010. International callers should dial
617-801-6888. The replay passcode for all callers is 43040680. The
webcast will also be archived on the company's website until November
23, 2008.

About JHP Pharmaceuticals, LLC

JHP, headquartered in New Jersey, is a specialty pharmaceutical
company which manufactures and sells pharmaceutical products,
primarily aseptic injectable products into the hospital segment, and
provides contract manufacturing of sterile products for innovator
pharmaceutical companies. JHP markets 14 branded pharmaceutical
products through its national sales and marketing infrastructure and
contract manufactures pharmaceutical products for large proprietary
pharmaceutical companies. JHP employs more than 350 staff in the USA
in its manufacturing, sales & marketing and corporate areas. In
August, JHP announced the acquisition of US and Canadian rights for
Dantrium(R) (dantrolene sodium) from Procter & Gamble. JHP is a
private company wholly owned by JHP Holdings, LLC.

About NitroMed, Inc.

NitroMed of Lexington, Massachusetts is the maker of BiDil(R)
(isosorbide dinitrate/hydralazine hydrochloride), an orally
administered medicine available in the United States for the treatment
of heart failure in self-identified black patients. In this
population, BiDil is indicated as an adjunct to current standard
therapies such as angiotensin converting enzyme (ACE) inhibitors and
beta blockers. There is little experience in patients with New York
Heart Association Class IV heart failure. BiDil was approved by the
U.S. Food and Drug Administration, primarily on the basis of efficacy
data from the company's landmark A-HeFT (African American Heart
Failure Trial) clinical trial. For full prescribing information,
visit: www.BiDil.com.

Cautionary Statement Regarding Forward-Looking Information

Statements in this press release regarding the proposed
transaction between NitroMed and JHP, including without limitation the
expected timetable for completing the transaction and the aggregate
purchase price; the company's ability to enter into one or more other
strategic transactions that may maximize shareholder value; the
company's estimates regarding operating expenses for the fiscal year;
and any other statements about NitroMed's future expectations,
beliefs, goals, plans or prospects constitute forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. Any statements that are not statements of
historical fact (including statements containing the words "believes,"
"plans," "could," "anticipates," "expects," "estimates," "plans,"
"should," "target," "will," "would" and similar expressions) should
also be considered to be forward-looking statements. There are a
number of important factors that could cause actual results or events
to differ materially from those indicated by such forward-looking
statements, including risks relating to: the ability of each of
NitroMed and JHP to satisfy the closing conditions and consummate the
transaction, including the approval of the transaction by NitroMed's
stockholders; NitroMed's ability to maintain regulatory approvals to
market and sell BiDil pending the closing of the transaction;
NitroMed's ability to maintain and enforce patent and other
intellectual property protection for BiDil pending the closing of the
transaction, and also with respect to its nitric oxide enhancing
technologies; NitroMed's ability to successfully enter into additional
transactions, including the sale of its nitric oxide enhancing
technologies and/or a merger of the company with a third party, on
favorable terms, if at all; and the other factors described in
NitroMed's Quarterly Report on Form 10-Q for the quarter ended June
30, 2008, as filed with the SEC, and other filings that NitroMed makes
with the SEC from time to time. If one or more of these factors
materialize, or if any underlying assumptions prove incorrect,
NitroMed's actual results, performance or achievements may vary
materially from any future results, performance or achievements
expressed or implied by these forward-looking statements.

In addition, the statements in this press release reflect
NitroMed's expectations and beliefs as of the date of this release.
NitroMed anticipates that subsequent events and developments will
cause its expectations and beliefs to change. However, while NitroMed
may elect to update these forward-looking statements publicly at some
point in the future, it specifically disclaims any obligation to do
so, whether as a result of new information, future events or
otherwise. NitroMed's forward-looking statements do not reflect the
potential impact of any future dispositions or strategic transactions
it may undertake. These forward-looking statements should not be
relied upon as representing NitroMed's views as of any date after the
date of this release.

- - Financial Tables Follow - -

-0-
*T

NITROMED, INC.
SELECTED FINANCIAL INFORMATION
(in thousands, except per share amounts)

CONDENSED BALANCE SHEETS
As of September 30, 2008 and December 31, 2007
(Unaudited)
September 30, December 31,
2008 2007
------------- ------------
ASSETS

Cash and marketable
securities $ 17,823 $ 31,400
Accounts receivable,
net 1,979 1,929
Inventories 1,230 1,401
Other assets 1,860 837
------------- ------------

Total assets $ 22,892 $ 35,567
============= ============

LIABILITIES AND
STOCKHOLDERS' EQUITY

Current liabilities $ 3,868 $ 13,342
Stockholders' equity 19,024 22,225
------------- ------------

Total liabilities and
stockholders' equity $ 22,892 $ 35,567
============= ============

CONDENSED STATEMENTS OF OPERATIONS
For the three and nine months ended September 30, 2008 and 2007
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
-------------------------- ------------------
2008 2007 2008 2007
------------- ------------ -------- ---------
Revenues:
Product sales $ 4,003 $ 3,759 $11,767 $ 11,042

Cost and operating
expenses:
Cost of product sales 1,429 560 2,943 2,151
Research and
development 482 3,807 2,622 9,745
Sales, general and
administrative 2,534 8,127 8,438 23,709
Restructuring charge (17) - 2,708 1,004
------------- ------------ -------- ---------

Total cost and
operating expenses 4,428 12,494 16,711 36,609
------------- ------------ -------- ---------

Net loss from operations (425) (8,735) (4,944) (25,567)
------------- ------------ -------- ---------

Non-operating income,
net 35 381 352 863
------------- ------------ -------- ---------

Net loss $ (390) $ (8,354) $(4,592) $(24,704)
============= ============ ======== =========

Basic and diluted net
loss per common share $ (0.01) $ (0.18) $ (0.10) $ (0.60)
============= ============ ======== =========

Shares used in computing
basic and diluted net
loss per common share 46,042 45,180 45,954 40,877
============= ============ ======== =========
*T

NitroMed, Inc.
Jane A. Kramer, 781-266-4220
Mobile: 781-640-8499

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