Nutrition 21 Reports Fiscal Second-Quarter Results

PURCHASE, N.Y., February 12, 2004--Nutrition 21, Inc. (Nasdaq: NXXI), the leading developer and marketer of chromium-based nutritional supplements, today reported a fiscal second quarter net loss of $1.2 million ($0.03 per diluted share) on revenues of $2.4 million, compared with a net loss of $2.3 million ($0.07 per diluted share) on revenues of $2.3 million for the same period a year ago. For the six months ended December 31, the Company reported a net loss of $2.3 million  ($0.06 per diluted share) on revenues of $4.8 million, compared to a net loss of $2.4 million ($0.07 per diluted share) on revenues of $5.6 million for the comparable period a year ago.

Gail Montgomery, President and CEO of the Company commented, “We are pleased with the modest improvements in ingredient revenues, gross margins and operating expenses that are reflected in these results.”

“We continue to work toward optimizing the value of our chromium-based intellectual property as we prepare for the launch of our therapeutic branded products. An important and critical first step was the December 2003 filing of our health claim petition with the U.S. Food and Drug Administration (FDA).  The petition requested that the FDA allow use of eight dietary supplement health claims associating chromium picolinate supplementation with reduced risk of insulin resistance, type 2 diabetes and related disease conditions.

 “Our key FY2004 strategic objectives include 1) presentation and promotion of breakthrough findings associated with our chromium technologies; 2) expansion of chromium research through third party institutions; and 3) securing medical acceptance for the therapeutic use of Chromax® chromium picolinate and Diachrome™ in insulin-resistant populations. We look forward to publicizing the findings from several recently completed research programs at key scientific meetings this spring.  This growing body of evidence supports our health claim petition. It also supports our efforts to expand our licensing program and develop key strategic alliances to market and distribute our brands.”

“We expect that business development expenses will increase as we draw closer to launching our brands.”

At December 31, 2003, the Company had $ 5.7 million in cash and short- term investments, and working capital of $5.8 million compared to $4.1 million in cash and working capital at June 30, 2003.

On October 9, 2003 the Company completed a private placement of 4, 062,500 shares of common stock for aggregate gross proceeds of $3.25 million. The net proceeds of approximately $3.00 million from the sale of these securities are intended for general corporate purposes, including the continued clinical and market development of the Company’s therapeutic initiatives.

About Nutrition 21

    Nutrition 21 is a nutrition bioscience company using pharmaceutical quality research to substantiate the health benefits of nutritional supplements .It holds 24 patents for chromium compounds and their uses and 11 other nutrition patents. The Company’s proprietary technologies focus on chromium picolinate and its relationship to insulin resistance, a condition implicated in type 2 diabetes, cardiovascular disease, obesity and depression.  Nutrition 21 markets Chromaxâ, chromium picolinate, the leading chromium ingredient used in supplements.  The Company is developing its first branded product, Diachrome™, for people with type 2 diabetes intended to be marketed through healthcare channels.  More information is available at http://www.nutrition21.com. www.chromax.com, and www.diachrome.com

Safe Harbor Provision

This press release may contain certain forward-looking statements.  The words “believe,” “expect,” “anticipate” and other similar expressions generally identify forward-looking statements.  Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates.  These forward-looking statements are based largely on the Company's current expectations and are subject to a number of risks and uncertainties, including without limitation: the effect of the expiration of patents; regulatory issues; uncertainty in the outcomes of clinical trials; changes in external market factors; changes in the Company's business or growth strategy or an inability to execute its strategy due to changes in its industry or the economy generally; the emergence of new or growing competitors; various other competitive factors; and other risks and uncertainties indicated from time to time in the Company's filings with the Securities and Exchange Commission, including its Form 10-K/A for the year ended June 30, 2003.  Actual results could differ materially from the results referred to in the forward-looking statements.  In light of these risks and uncertainties, there can be no assurance that the results referred to in the forward-looking statements contained in this press release will in fact occur.  Additionally, the Company makes no commitment to disclose any revisions to forward-looking statements, or any facts, events or circumstances after the date hereof that may bear upon forward-looking statements.

Contacts:       

Investor Relations: 914-701-4545

NUTRITION 21, INC.

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NUTRITION 21, INC.

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