May 14, 2001

Neurochem Announces Third Quarter 2001 Financial Results

Neurochem Inc. (TSX : NRM) today announced fiscal third quarter 2001 financial results for the three-month period ended March 31, 2001.

Highlights of the third quarter of 2001 include:

• Presentation of important findings related to the genetic control of the inflammatory response to Amyloid ß (Aß) at the IBC Conference in Atlanta on Alzheimer's Disease
• Publication on the characterization of our amyloid transgenic mouse model in prestigious Journal of Biological Chemistry
• Receipt of funding from the Natural Sciences and Engineering Research Council (NSERC) for the Company's proprietary Epilepsy program
• Preparatory discussions with the U.S. FDA regarding the eventual NDA filing for Fibrillex™

"The research presented at the IBC Conference and the information reported in the Journal of Biological Chemistry provide strong scientific support for our proprietary Alzheimer's Disease therapeutics platform," said Dr. Louis R. Lamontagne, President and Chief Executive Officer of Neurochem. "By validating that amyloid ß is instrumental in inducing the brain's inflammatory response, we have provided another important validation of our proprietary anti-amyloid platform."

Neurochem Research Shows Genetics Play Key Role in the Brain's Defence Against Amyloid ß-Induced Inflammation

On February 8, 2001 Neurochem reported at the IBC Conference on Alzheimer's Disease (Atlanta, GA) that genetics play an important role in the way the brain's cellular defence responds to Aß. Using genetically different strains of mice known to have low or high response to inflammation, Neurochem researchers found a genetic predisposition to the neurotoxic effect that Ab triggers on microglia (the brain macrophages). While microglia from some strains of mice respond very strongly to Aß by producing neurotoxic factors and other inflammatory mediators, microglia from other strains are mildly affected by Aß. These new results suggest that differences in the levels of cellular-mediated inflammation, initially caused by amyloid ß, are genetically linked and could alter the sequence of events leading to neuronal cell death in Alzheimer's Disease.

"Results of this study reaffirm the core role of amyloid in the development of Alzheimer's Disease and suggest that patients who are known to be genetically predisposed to suffer from amyloid-induced inflammation could significantly benefit from early treatment to stem the disease progression," remarked Dr. Lamontagne.

Amyloid Transgenic Mouse Model Reported in Prestigious Peer Review Journal

Neurochem has contributed to the thorough characterization of a newly developed transgenic mouse model of Alzheimer's Disease which shows rapid onset of brain amyloidosis. This article titled Early-Onset Amyloid Deposition and Cognitive Deficits in Transgenic Mice Expressing a Double Mutant Form of APP695 has now been published in March 2001 in the prestigious peer-reviewed Journal of Biological Chemistry. The published data demonstrates that high levels of amyloidogenic protein are associated with early-stage cognitive impairment of the transgenic mice. Furthermore, the publication provides evidence that the transgenic mouse model is a key model in the investigation of the pathogenesis of Alzheimer's Disease and in the identification of a potential treatment currently being developed by Neurochem.

Company Receives Additional Funding of Epilepsy Program

During the quarter, Neurochem received peer-reviewed recognition by the Natural Sciences and Engineering Research Council (NSERC) for the Company's proprietary Epilepsy program conducted at Queen's University, Kingston (Canada) in collaboration with neurologist and Head of Neurology at Kingston General Hospital (Canada) Dr. Donald Weaver. NSERC is contributing to the Collaborative Research and Development Project by granting $398,600 over a three-year period to expand the program towards the prevention and treatment of seizures and convulsions associated with the disease.

Fibrillex™ Clinical Update

With Neurochem's current patient recruitment program well underway, on February 20, 2001 the Company held an End of Phase II meeting with the Division of Cardio Renal Drug Products of the U.S. Food and Drug Administration (FDA). Clinical endpoints of the Fibrillex™ pivotal Phase II/III study, as well as future filing requirements for the New Drug Application (NDA) were discussed with the FDA.

The meeting resulted in an agreement on the clinical endpoints of the Phase II/III study and on the data to be included for the NDA filing.

Financial Highlights

Higher revenues of $1.8 million over the comparable 2000 quarter were offset by a $1.5 million increase in net R&D and general administrative expenses, and accounted for the $341,000 reduction in net loss over the comparable quarter. The increase in revenue was due to $1.3 million in research support payments from H. Lundbeck A/S ("Lundbeck") and $531,000 more in interest income as a result of significantly higher average cash balances for the current period. The research support payments were triggered by the successful completion of a proof of concept study for an anti-amyloid compound to treat Alzheimer's Disease achieved last quarter. For the nine months ended March 31, 2001, the milestone and research support payments totaling $5.1 million from Lundbeck reduced the cumulative net loss to $1,078,000 or ($0.06) per share compared to a net loss of $4,266,000 or ($0.34) per share for the same period last year.

Research and development expenditures, before the application of research tax credits and grants, increased to $2,600,000 as compared to $1,731,000 for the comparable quarter last year. Research tax credits, federal grants and investment contributions amounted to $647,000 as compared to $1,244,000 for the quarter ended March 31, 2000. The latter included $146,000 in research credits from prior years and $283,000 in grants which were subsequently concluded.

General, administrative, and other corporate expenses increased to $937,000 for the quarter ended March 31, 2001, as compared to $564,000 for the comparable quarter last year. The majority of the $373,000 quarter-to-quarter increase in expenses represented costs associated with being a public company ($219,000), including investor relations, as well as higher costs ($128,000) in corporate development related to increased activity in corporate partnering and external research agreements.

As at March 31, 2001, the Company had cash and short-term investments of $37.1 million, which compares to $32.9 million for the fiscal year ended June 30, 2000. The net increase in cash resources since June 30, 2000 is due to the exercise of the underwriters' 15% over-allotment option in August 2000 and the various payments received from Lundbeck, including a US$2.5 million equity purchase.

Neurochem Inc.
Selected Financial Highlights ($'000CDN)1

Three months Ended March 31

Nine months Ended March 31

Statement of Operations

2001

2000

2001

2000

Revenue:

   Milestone payment

-

-

3,807

-

   Research contracts

1,277

-

1,277

-

   Interest

580

49

1,549

277

1,857

49

6,633

277

Expenses:

   Research and
   development

2,600

1,731

6,809

4,866

   Research tax credits
   & grants

(647)

(1,244)

(1,504)

(1,914)

   General and corporate

937

564

2,615

1,591

   Foreign exchange

(372)

0

(209)

0

2,518

1,051

7,711

4,543

Net Loss

(661)

(1,002)

(1,078)

(4,266)

Net Loss per common share:

   Basic

(0.04)

(0.08)

(0.06)

(0.34)

   Fully diluted

(0.04)

(0.08)

(0.06)

(0.34)

Weighted average number of common shares outstanding

17,624,970

12,627,251

17,283,353

12,508,170

Balance Sheets

At March 31 2001

At June 30 2000

Assets:

   Cash, cash
   equivalents and
   marketable securities

37,107

32,929

   Other current assets

4,065

2,447

Total current assets

41,172

35,376

Capital assets

4,157

2,214

Other long term assets

376

176

Total assets

45,705

37,766

Liabilities and Shareholders' Equity:

   Current liabilities

2,208

2,496

   Deferred research
   contract revenue

1,286

0

   Obligations under
   capital leases

357

568

   Shareholders' equity

41,854

34,702

Total liabilities and shareholders' equity

45,705

37,766

1 Condensed from the Company's unaudited interim financial statements.

About Neurochem

Neurochem is a leader in the development of novel, proprietary compounds that inhibit the formation, deposition and toxic effects of amyloid fibrils within the body. Neurochem's research team has been working with international amyloid experts on the development of therapeutic cures to amyloid-related diseases, including Alzheimer's Disease, Secondary Amyloidosis, Diabetes Type II and Hemorrhagic Stroke due to Cerebral Amyloid Angiopathy. Neurochem has advanced three drug candidates to clinical trials : Alzhemed™, for Alzheimer's Disease, Fibrillex™, in a pivotal Phase II/III clinical trial, for Secondary Amyloidosis and Cerebril™, for Hemorrhagic Stroke.

At present, the Company employs over 75 people and is located in Saint-Laurent, Canada (www.neurochem.com).

All of the statements contained in this news release, other than statements of fact which are independently verifiable at the date hereof, are forward-looking statements. Such statements, based as they are on the current expectations of management, inherently involve numerous risks and uncertainties, known and unknown. Some examples of known risks are: the impact of general economic conditions, general conditions in the pharmaceutical industry, changes in the regulatory environment in the jurisdictions in which Neurochem does business, stock market volatility, fluctuations in costs, and changes to the competitive environment due to consolidation or otherwise. Consequently, actual future results may differ materially from the anticipated results expressed in the forward-looking statements.

For further Information, please contact:
Dr. Lise Hébert
Vice President, Corporate Communications
lhebert@neurochem.com

275 Armand-Frappier
Laval (Quebec)
H7V 4A7
Tel: (450) 680-4500
Fax: (450) 680-4501

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