LA JOLLA, Calif., Aug. 11 /PRNewswire/ -- SIBIA Neurosciences, Inc.
(Nasdaq: SIBI) today reported financial results for the second quarter ended
June 30, 1999.  For the quarter, SIBIA reported a net loss of $499,000, or
$0.05 per share, compared to a net loss of $2,451,000, or $0.26 per share, for
the second quarter of 1998.  SIBIA reported revenues of $4,221,000 for the
second quarter of 1999 compared to $2,361,000 for the same period in 1998.
    For the six months ended June 30, 1999, SIBIA reported a net loss of
$3,339,000, or $0.35 per share, compared to a net loss of $6,503,000, or
$0.69 per share, for the same period in 1998.  SIBIA reported revenues of
$6,736,000 for the first half of 1999 compared to $3,895,000 for the same
period in 1998.
    Revenues for the second quarter and the six months ended June 30, 1999
were significantly higher than the comparable periods in the prior year due
primarily to license fees from agreements with American Home Products,
Bristol-Myers Squibb, and SmithKline Beecham and the initial revenues from a
collaborative research agreement with Eli Lilly & Co.  This increase was
partially offset by a decrease in revenue from a collaborative research
program with Novartis AG that was completed in September 1998.
    Research and development expenses for the second quarter and the six
months ended June 30, 1999 decreased from the comparable periods in the prior
year.  This decrease was primarily due to reduced costs associated with the
clinical studies for the Company's two lead drug candidates (SIB-1508Y and
SIB-1553A).  General and administrative expenses also decreased in the second
quarter of 1999 and the six months ended June 30, 1999 from the comparable
periods in 1998 due primarily to decreased legal fees related to patent
litigation.
    On August 2, 1999, SIBIA and Merck & Co., Inc. (NYSE: MRK), a research-
driven pharmaceutical company, announced they have entered into a definitive
agreement under which Merck will acquire SIBIA for $8.50 per share in cash.
Merck commenced a tender offer for SIBIA shares on or about August 6, 1999.
The transaction will total approximately $87 million.

    This press release contains forward-looking statements that involve risks
and uncertainties.  As a result, actual results could differ materially from
those discussed herein.  These risks and uncertainties include SIBIA's
reliance on corporate partnerships and ability to enter into new corporate
partnerships, whether SIBIA will be successful in demonstrating the safety and
efficacy of SIB-1508Y and SIB-1553A in humans, whether SIBIA will be able to
meet its development goals with respect to its drug candidates and proprietary
targets, SIBIA's early stage of development, the new and uncertain state of
SIBIA's technologies, SIBIA's future capital needs and the uncertainty of
receiving additional funding, uncertainties regarding patents, proprietary
rights and regulatory matters, whether the transactions contemplated by the
merger agreement between SIBIA and Merck & Co., Inc. are consummated, and
other research, development and market risks.  These and other risks and
uncertainties are more fully set forth in SIBIA's most recently filed Forms
10-Q and 10-K and SIBIA's current reports on Form 8-K dated July 30, 1999 and
August 2, 1999.


                            SIBIA NEUROSCIENCES, INC.
                        CONDENSED STATEMENT OF OPERATIONS
                                   (UNAUDITED)

                           Three Months Ended          Six Months Ended
                                 June 30,                   June 30,
                            1999          1998          1999         1998
    Revenue:
     Contract            $1,458,000   $2,276,000    $2,468,000    $3,810,000
     License and royalty  2,763,000       85,000     4,268,000        85,000
      Total revenue       4,221,000    2,361,000     6,736,000     3,895,000

    Operating expenses:
     Research and
      development         3,951,000    4,514,000     8,453,000     9,310,000
     General and
      administrative      1,045,000    1,586,000     2,220,000     3,077,000
      Total operating
       expenses           4,996,000    6,100,000    10,673,000    12,387,000
                           (775,000)  (3,739,000)   (3,937,000)   (8,492,000)
    Other income
     (expense):
     Interest income        183,000      412,000       404,000       876,000
     Interest expense       (35,000)     (24,000)      (68,000)      (47,000)
     Gain on sale
      of investment         105,000      900,000       239,000     1,160,000
     Other                   23,000                     23,000            --
                            276,000    1,288,000       598,000     1,989,000
    Net loss              $(499,000) $(2,451,000)  $(3,339,000)  $(6,503,000)

    Basic and diluted
     net loss per
     common share            $(0.05)      $(0.26)       $(0.35)       $(0.69)

    Shares used in
     computing basic
     and diluted net
     loss per
     common share         9,661,653    9,391,243     9,592,874     9,378,271


                            SIBIA NEUROSCIENCES, INC.
                             CONDENSED BALANCE SHEET

                                          June 30, 1999      December 31, 1998
                                            (Unaudited)
    ASSETS

    Cash, cash equivalents
     and investment securities              $18,588,000          $17,187,000
    Contract receivables,
     prepaid and other current assets         2,351,000            1,184,000
    Total current assets                     20,939,000           18,371,000
    Property and equipment, net               2,757,000            2,638,000
    Other assets                                 12,000              190,000
                                            $23,708,000          $21,199,000

    LIABILITIES AND STOCKHOLDERS' EQUITY

    Total current liabilities                 4,062,000            4,709,000
    Contract advance                          1,375,000                   --
    Long-term capital lease obligations       1,296,000            1,350,000
    Total stockholders' equity               16,975,000           15,140,000
                                            $23,708,000          $21,199,000

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