XenoPort Reports Second Quarter Financial Results

Santa Clara, CA. - Aug 10, 2005 - PRNewswire-FirstCall via COMTEX/ -- XenoPort, Inc. (Nasdaq: XNPT) announced today its financial results for the second quarter and six months ended June 30, 2005. Revenues for the quarter were $813,000, compared to $2.7 million for the same period in 2004. Net loss for the second quarter was $11.7 million, compared to a net loss of $7.3 million for the same period in 2004. At June 30, 2005, XenoPort had cash and cash equivalents and short-term investments of $86.7 million.

XenoPort Quarterly Highlights:
On June 2, 2005, XenoPort completed its initial public offering, selling 5,000,000 shares of its common stock at a public offering price of $10.50 per share. Net cash proceeds from the initial public offering were approximately $46.3 million, after deducting underwriting discounts and commissions and other offering expenses.

Since the start of the second quarter, XenoPort has announced results from the successful completion of three clinical trials:

-- A Phase 2b clinical trial demonstrated that XP13512 provided statistically significant and clinically relevant benefits to patients with restless legs syndrome (RLS) when dosed at 1200 mg once a day for 14 days.

-- A Phase 2a clinical trial showed that XP13512 provided statistically significant and clinically relevant benefits to patients with post-herpetic neuralgia (PHN) when administered twice a day.

-- A Phase 1 clinical trial demonstrated that XP19986 was well absorbed and rapidly converted to the R-isomer of baclofen, and that it provided a pharmacokinetic profile consistent with requirements for twice-a-day dosing when formulated for sustained release.

Ronald Barrett, Ph.D., Chief Executive Officer of XenoPort, stated, "The completion of our IPO in June represents another significant step in the growth of XenoPort. This infusion of cash will be used primarily to advance our clinical development programs that have clearly demonstrated great potential in clinical trials completed to date."

XenoPort Second Quarter and Six Month Financial Results:
Revenues for the three and six months ended June 30, 2005 were $813,000 and $3.6 million, respectively, compared to $2.7 million and $5.0 million for the same periods in 2004. The decrease in revenues for both periods was primarily due to the conclusion of our collaboration with ALZA Corporation in March 2005 and the completion of our ATP and SBIR grants in September 2004 and February 2005, respectively.

Research and development expenses for the three and six months ended June 30, 2005 were $10.4 million and $20.8 million, respectively, compared to $8.3 million and $15.0 million for the same periods in 2004. The increase for both periods was principally due to expenses related to the development of XP13512 and XP19986, as well as increased non-cash amortization of deferred stock- based compensation.

General and administrative expenses for the three and six months ended June 30, 2005 were $2.5 million and $4.8 million, respectively, compared to $1.9 million and $3.5 million for the same periods in 2004. The increase for both periods was primarily due to increased personnel expenses, including non- cash amortization of deferred stock-based compensation.

Net loss for the three and six months ended June 30, 2005 was $11.7 million and $21.3 million, respectively, compared to a net loss of $7.3 million and $13.3 million for the same periods in 2004. Loss applicable to common stockholders, which includes convertible preferred stock dividends, was $12.1 million and $22.3 million for the three and six months ended June 30, 2005, respectively, compared to $7.3 million and $13.3 million for the same periods in 2004. Basic and diluted loss per share applicable to common stockholders was $1.67 and $4.95 for the three and six months ended June 30, 2005, respectively, compared to $6.29 and $11.70 for the same periods in 2004.

On a pro forma basis, basic and diluted loss per share applicable to common stockholders was $0.76 and $1.47 for the three and six months ended June 30, 2005, respectively, compared to $0.65 and $1.21 for the same periods in 2004. The pro forma basic and diluted loss per share calculations assume the conversion of all outstanding shares of preferred stock into shares of common stock using the as-if-converted method as of January 1, 2004 or the date of issuance, if later.