FLAMEL TECHNOLOGIES S.A. CONSOLIDATED STATEMENTS OF OPERATIONS

(Amounts in thousands of dollars except share data)

	Year ended December 31,
	2003	2004	2005	2006	2007	2008
Revenue:
License and research revenue	20,978	50,893	20,825	20,263	10,307	13,247
Product sales and services	3,411	3,755	1,757	2,083	19,768	13,549
Other revenues	778	762	1,016	674	6,579	11,823
Total revenue	25,167	55,410	23,598	23,020	36,654	38,619
Costs and expenses:
Cost of goods and services sold	(3,676)	(3,602)	(2,525)	(6,250)	(17,320)	(9,621)
Research and development	(20,223)	(35,359)	(47,301)	(38,233)	(43,557)	(36,247)
Selling, general and administrative	(5,967)	(7,614)	(14,541)	(17,375)	(16,626)	(12,911)
Total costs and expenses	(29,866)	(46,575)	(64,367)	(61,858)	(77,503)	(58,779)
Profit / (Loss) from operations	(4,699)	8,835	(40,769)	(38,838)	(40,849)	(20,160)
Interest income / (expense), net	163	607	3,603	2,022	1,691	1,432
Foreign exchange gain (loss)	(1,019)	(244)	500	(599)	(454)	3
Other income -	1,128	100	5,003	131	197	181
Income (loss) before income taxes	(4,427)	9,298	(31,663)	(37,319)	(39,431)	(18,562)
Income tax benefit (expense)	503	3,201	4,286	2,118	1,694	6,478
Net income (loss)	(3,924)	12,499	(27,377)	(35,201)	(37,737)	(12,084)
Earnings (loss) per share
Basic earnings (loss) per ordinary share	$(0.22)	$ 0.58	$ (1.19)	$ (1.48)	$ (1.57)	$ (0.50)
Diluted earnings (loss) per share	$(0.22)	$ 0.53	$ (1.19)	$ (1.48)	$ (1.57)	$ (0.50)
Weighted average number of shares outstanding (in thousands):
Basic	17,762	21,514	22,999	23,812	24,024	24,082
Diluted	17,762	23,559	22,999	23,812	24,024	24,082