Conor Medsystems Announces Third Quarter 2006 Financial Results

MENLO PARK, Calif., Nov. 8  /PRNewswire-FirstCall/ -- Conor Medsystems, Inc. (NASDAQ:CONR) today announced results of operations for the quarter ended September 30, 2006.

Conor reported a net loss for the third quarter of 2006 of $10.1 million, or $0.28 per share, compared to a net loss of $14.6 million, or $0.44 per share, for the three months ended September 30, 2005.  For the nine months ended September 30, 2006, Conor reported a net loss of $39.8 million, or $1.15 per share, compared to a net loss of $38.1 million, or $1.16 per share, for the nine months ended September 30, 2005.

Revenues from product sales were $10.7 million for the third quarter of 2006, compared to $1.0 million for the third quarter of 2005.  For the nine months ended September 30, 2006, revenues were $26.4 million, compared to $1.4 million for the nine months ended September 30, 2005.

Research and development expenses increased to $11.2 million in the third quarter of 2006 from $7.7 million in the third quarter of the prior year, primarily due to higher payroll expenses associated with an increased number of research and development personnel, expenditures for Conor's clinical trials and non-cash stock-based compensation expense.  Research and development expenses for the nine months ended September 30, 2006 were $38.3 million, compared to $21.8 million for the same period in 2005.

General and administrative expenses were $6.0 million for the third quarter of 2006 compared to $6.4 million for the three months ended September 30, 2005.  General and administrative expenses for the nine months ended September 30, 2006 were $17.2 million, compared to $16.5 million for the same period in 2005.

Conference Call and Webcast Information

Frank Litvack, M.D., Chairman and Chief Executive Officer, Michael Boennighausen, Chief Financial Officer, and members of the Conor Medsystems executive management team will host a conference call at 5:00 p.m. Eastern Time today to discuss Conor's operating and financial results and provide updates on the company's commercialization efforts, clinical trials, product development activities, litigation and other business matters.

To access the live audio broadcast or the subsequent archived recording, visit the webcast section of the company's website located at http://www.conormed.com/. Please log on to Conor's website several minutes prior to the start of the presentation to ensure adequate time for any software download that may be necessary. A replay of the web cast will remain at this location until such time as the company reports its financial results for the fourth quarter of 2006.

The webcast is also being distributed through the Thomson StreetEvents Network to both institutional and individual investors. Individual investors can listen to the call at http://www.fulldisclosure.com/ and institutional investors can access the call via http://www.streetevents.com/.  The dial-in number for the conference call is 800-901-5217 in the U.S., 617-786-2964 outside the U.S., and the participant passcode is 45404076.

About Conor Medsystems

Conor Medsystems, Inc. develops innovative controlled vascular drug delivery technologies and has initially focused on the development of drug- eluting stents to treat coronary artery disease. For further information about Conor and controlled vascular delivery, visit http://www.conormed.com/.

CoStar(R) is not available for sale in the U.S.  CoStar is an investigational device limited by federal law to investigational use.

                          Conor Medsystems, Inc.
                Consolidated Statements of Operations Data
                 (In thousands, except per share amounts)
                               (unaudited)


                          Three months ended          Nine months ended
                             September 30,              September 30,
                           2006         2005         2006         2005

  Product sales          $10,701       $1,045      $26,420       $1,369

  Cost of sales (1)        4,786        2,303       13,654        3,144
    Gross margin           5,915       (1,258)      12,766       (1,775)

  Operating expenses:
    Research and
     development (1)      11,181        7,722       38,322       21,828
    General and
     administrative (1)    6,005        6,375       17,236       16,544
      Total operating
       expenses           17,186       14,097       55,558       38,372
  Loss from operations   (11,271)     (15,355)     (42,792)     (40,147)

  Interest income          1,256          841        2,567        2,309
  Other income
   (expense), net            (43)         (49)         454         (297)
  Net loss               (10,058)     (14,563)     (39,771)     (38,135)


  Basic and diluted
   net loss per share     $(0.28)      $(0.44)      $(1.15)      $(1.16)

  Shares used to compute
   basic and diluted
   net loss per share     36,170       33,170       34,436       32,903

  (1) Includes non-cash
   stock-based compensation
   expense as follows:
    Cost of sales           $246          $--         $594          $--
    Research and
     development           1,989        1,536        6,666        3,820
    General and
     administration        1,850        1,756        5,371        5,317
      Total               $4,085       $3,292      $12,631       $9,137


                     Consolidated Balance Sheet Data
                              (In thousands)
                               (unaudited)

                                September 30, 2006      December 31, 2005

  Cash and cash equivalents          $132,543                $78,470
  Working capital                     134,469                 69,513
  Total assets                        157,210                 92,070

  Long-term liabilities                   239                    334
  Accumulated deficit                (142,908)              (103,137)
  Total stockholders' equity          144,413                 78,723


DATASOURCE: Conor Medsystems, Inc.



CONTACT:  investors, Michael Boennighausen, Chief Financial Officer of

Conor Medsystems, Inc., [phone]; or media, Karen L. Bergman of BCC

Partners, [phone], for Conor Medsystems, Inc.



Web site:  http://www.conormed.com/ 

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