Simulations Plus Reports FY2012 and Fourth Quarter FY2012 Financial Results

Simulations Plus Reports FY2012 and Fourth Quarter FY2012 Financial Results

Simulations Plus, Inc. (NASDAQ: SLP), a leading provider of software for pharmaceutical discovery and development, today reported its financial results for its 2012 fiscal year (FY12) and fourth quarter (4Q12) ended August 31, 2012. The former Words+ subsidiary was sold on November 30, 2011, therefore results provided in this press release and in our annual report treat Words+ as discontinued operations and are based on the performance of the ongoing pharmaceutical software and services business.

Ms. Momoko Beran, chief financial officer for Simulations Plus, said: “We completed another record fiscal year, with all four quarters setting new quarterly records. Earnings per share increased by more than 11% - the direct result of a strong performance from our pharmaceutical software and services business. R&D expenses increased because we have increased our scientific staff, increased salaries for existing staff, and because of outside expenses incurred through our investment in our malaria project. SG&A increased 6.1% primarily because we now pay the entire office lease following the sale of Words+ on November 30, 2011. Words+ pays 20% of the lease, however it is reported as other income rather than offsetting the lease expense. Other increases in SG&A were advertising, trade shows, marketing labor as we attended more trade shows and conferences, insurance (health/dental, directors and officers), and increased legal fees incurred during our due diligence activities for the unsuccessful attempted acquisition of Entelos in bankruptcy court.”

Walt Woltosz, chairman and chief executive officer of Simulations Plus, added: “The sale of Words+ last year has enabled us to focus all of our energies and resources on the pharmaceutical software and services business. Our sustained growth and profitability in this business is the result of our annual license business model and the high renewal rates that we have consistently enjoyed, as well as continued growth in our consulting, collaboration, and training activities. During this fiscal year, we conducted Advanced Training Workshops and we added which have been well attended by scientists from the pharmaceutical industry, academia, and government agencies in the U.S., Europe, and Asia. These workshops generate a profit and they serve to anchor our software with our customers as they learn how much more they can do with it beyond the basics.”

Mr. Woltosz continued: “During this fiscal year, we embarked on a New Chemical Entity (NCE) project for malaria. Using our ™, which consists of our ™, ™, and ™ software, we designed new molecules to treat malaria. In September 2011, we announced that we had completed our design efforts and that we were soliciting quotations from chemistry companies to synthesize these novel molecules. At that time, we had no idea whether we would be successful in our predictions that these molecules would inhibit the growth of the malaria parasite Plasmodium falciparum. After nearly nine months of challenging synthesis efforts, we had a total of seven new molecules synthesized and tested, and our hope was that at least one of our new molecules would inhibit the growth of the parasite. We were excited to learn that all of them did, but it’s important to add that our goal was not to develop a cure for malaria with this small effort. Rather, the purpose was to demonstrate that by using our software and design approaches, scientists can rapidly generate promising leads in a fraction of the typical time and cost – leads that could be followed up with a greater investment. As we have presented these results to audiences around the world, we’ve seen great interest and numerous requests to evaluate our .”

“We are now communicating with several organizations that fund research for malaria and other diseases,” Mr. Woltosz continued. “We hope to secure outside funding to take the malaria effort on a larger scale and to pursue other disease targets with our tools and chemistry expertise. We will also select an additional target on our own and invest in a second demonstration project to confirm that this process can be repeated for targets other than malaria.”

A conference call will be webcast live and may be accessed by first registering at the following website: . Upon registering, you will receive a confirmation e-mail with a unique link and instructions for joining the call. Please dial in five to ten minutes prior to the scheduled start time. For listen-only mode, you may dial (415) 655-0056, and enter access code 283-912-397.

Simulations Plus, Inc. is a premier developer of groundbreaking drug discovery and development simulation software, which is licensed to and used in the conduct of drug research by major pharmaceutical and biotechnology companies worldwide. We also provide consulting expertise to pharmaceutical and chemical companies worldwide. For more information, visit our Web site at .

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– With the exception of historical information, the matters discussed in this press release are forward-looking statements that involve a number of risks and uncertainties. Our actual future results could differ significantly from those statements. Factors that could cause or contribute to such differences include, but are not limited to: our ability to maintain our competitive advantages, acceptance of new software and improved versions of our existing software by our customers, the general economics of the pharmaceutical industry, our ability to finance growth, our ability to continue to attract and retain highly qualified technical staff, and a sustainable market. Further information on our risk factors is contained in our quarterly and annual reports as filed with the U.S. Securities and Exchange Commission.

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