##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 Quarterly Report Pursuant to Section 13 or 15 (d) of the Securities Exchange Act of 1934
 For the quarterly period ended March 31, 2007
 Commission file number 0-17254
 NOVEN PHARMACEUTICALS, INC.
  STATE OF DELAWARE
    
    59-2767632(State or other jurisdiction of
    
    (I.R.S. Employerincorporation or organization)
    
    Identification Number)
 (Address of principal executive offices) (Zip Code)
 (Registrants telephone number, including area code)
 þ o
  Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer o
 o þ
  Class
    
    Outstanding at April 30, 2007Common stock $.0001 par value
    
    24,837,695




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##### 



NOVEN PHARMACEUTICALS, INC.
  Page No.PART I  FINANCIAL INFORMATIONItem 1  Unaudited Condensed Financial StatementsCondensed Statements of Operations for the Three Months Ended March 31, 2007 and 2006
    
    
    3Condensed Balance Sheets as of March 31, 2007 and December 31, 2006
    
    
    4Condensed Statements of Cash Flows for the Three Months Ended March 31, 2007 and 2006
    
    
    5Notes to Unaudited Condensed Financial Statements
    
    
    6Item 2  Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    14Item 3  Quantitative and Qualitative Disclosures About Market Risk
    
    
    29Item 4  Controls and Procedures
    
    
    29PART II  OTHER INFORMATIONItem 1  Legal Proceedings
    
    
    30Item 1A  Risk Factors
    
    
    30Item 2  Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    31Item 5  Other Information
    
    
    31Item 6  Exhibits
    
    
    31SIGNATURES
    
    
    33EX-31.1 Section 302 Certification of CEOEX-31.2 Section 302 Certification of CFOEX-32.1 Section 906 Certification of CEOEX-32.2 Section 906 Certification of CFO
  Cautionary Factors
 Trademark Information ® ® ® ® ® 
 2




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##### Table of Contents



Item 1. Financial Statements
 NOVEN PHARMACEUTICALS, INC.
 
     2007
    
    
    2006Revenues:Product revenues  Novogyne:Product sales
    
    $
    5,369
    
    
    $
    3,087Royalties
    
    
    1,765
    
    
    
    1,689Total product revenues  Novogyne
    
    
    7,134
    
    
    
    4,776Product revenues  third parties
    
    
    8,472
    
    
    
    3,871Total product revenues
    
    
    15,606
    
    
    
    8,647Contract and license revenues:Contract
    
    
    (130
    )
    
    
    664License
    
    
    3,839
    
    
    
    881Contract and license revenues
    
    
    3,709
    
    
    
    1,545Net revenues
    
    
    19,315
    
    
    
    10,192Expenses:Cost of products sold  Novogyne
    
    
    2,959
    
    
    
    2,143Cost of products sold  third parties
    
    
    5,968
    
    
    
    3,997Total cost of products sold
    
    
    8,927
    
    
    
    6,140Research and development
    
    
    3,466
    
    
    
    3,482Marketing, general and administrative
    
    
    5,421
    
    
    
    4,738Total expenses
    
    
    17,814
    
    
    
    14,360Income (loss) from operations
    
    
    1,501
    
    
    
    (4,168
    )Equity in earnings of Novogyne
    
    
    4,903
    
    
    
    4,327Interest income, net
    
    
    1,632
    
    
    
    611Income before income taxes
    
    
    8,036
    
    
    
    770Provision for income taxes
    
    
    3,000
    
    
    
    266Net income
    
    $
    5,036
    
    
    $
    504Basic earnings per share
    
    $
    0.20
    
    
    $
    0.02Diluted earnings per share
    
    $
    0.20
    
    
    $
    0.02Weighted average number of common shares
outstanding:Basic
    
    
    24,738
    
    
    
    23,657Diluted
    
    
    25,384
    
    
    
    23,774
 The accompanying notes are an integral part of these statements.
 3




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##### Table of Contents



NOVEN PHARMACEUTICALS, INC.
 
    March 31,
    
    
    December 31,2007
    
    
    2006AssetsCurrent Assets:Cash and cash equivalents
    
    $
    34,625
    
    
    $
    9,144Short-term investments available-for-sale, at fair value
    
    
    149,869
    
    
    
    144,455Trade receivable (less allowance for doubtful
accounts of $52 in 2007 and $67 in 2006)
    
    
    4,693
    
    
    
    5,038Milestone payment receivable  Shire
    
    
    
    
    
    
    25,000Accounts receivable  Novogyne, net
    
    
    8,109
    
    
    
    7,693Inventories
    
    
    9,660
    
    
    
    8,651Net deferred income tax asset, current portion
    
    
    6,900
    
    
    
    4,400Prepaid income taxes
    
    
    11
    
    
    
    3,416Prepaid and other current assets
    
    
    2,784
    
    
    
    2,410216,651
    
    
    
    210,207Property, plant and equipment, net
    
    
    36,605
    
    
    
    37,010Other Assets:Investment in Novogyne
    
    
    18,439
    
    
    
    23,296Net deferred income tax asset
    
    
    9,195
    
    
    
    8,308Patent development costs, net
    
    
    2,253
    
    
    
    2,317Deposits and other assets
    
    
    501
    
    
    
    22730,388
    
    
    
    34,148$
    283,644
    
    
    $
    281,365Liabilities and Stockholders EquityCurrent Liabilities:Accounts payable and accrued expenses
    
    $
    4,572
    
    
    $
    5,184Capital lease obligation  current portion
    
    
    122
    
    
    
    109Accrued compensation and related liabilities
    
    
    2,895
    
    
    
    5,308Other accrued liabilities
    
    
    3,899
    
    
    
    2,085Deferred rent credit
    
    
    89
    
    
    
    89Deferred contract revenues
    
    
    1,477
    
    
    
    1,527Deferred license revenues  current portion
    
    
    14,994
    
    
    
    15,08428,048
    
    
    
    29,386Long-Term Liabilities:Capital lease obligation
    
    
    247
    
    
    
    279Deferred license revenues
    
    
    70,439
    
    
    
    74,188Other liabilities
    
    
    1,076
    
    
    
    83799,810
    
    
    
    104,690Commitments and Contingencies (Note 12)Stockholders Equity:Preferred stock  authorized 100,000 shares of $.01 par
value; no shares issued or outstanding
    
    
    
    
    
    
    Common stock  authorized 80,000,000 shares, par value
$.0001 per share; issued and outstanding 24,770,532
at March 31, 2007 and 24,661,169 at December 31, 2006
    
    
    2
    
    
    
    2Additional paid-in capital
    
    
    112,565
    
    
    
    109,912Retained earnings
    
    
    71,267
    
    
    
    66,761Common stock held in trust
    
    
    (375
    )
    
    
    Deferred compensation obligation
    
    
    375
    
    
    
    183,834
    
    
    
    176,675$
    283,644
    
    
    $
    281,365
 The accompanying notes are an integral part of these statements.
 4




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##### Table of Contents



NOVEN PHARMACEUTICALS, INC.
 
     2007
    
    
    2006Cash flows from operating activities:Net income
    
    $
    5,036
    
    
    $
    504Adjustments to reconcile net income to net cash flows
provided by (used in) operating activities:Depreciation, amortization and certain other noncash items
    
    
    1,301
    
    
    
    1,012Stock-based compensation expense
    
    
    988
    
    
    
    549Income tax benefits on exercise of stock options
    
    
    253
    
    
    
    137Excess tax deduction from exercise of stock options
    
    
    (195
    )
    
    
    (137
    )Deferred income tax benefit
    
    
    (3,387
    )
    
    
    (9
    )Recognition of deferred license revenues
    
    
    (3,839
    )
    
    
    (881
    )Equity in earnings of Novogyne
    
    
    (4,903
    )
    
    
    (4,327
    )Distributions from Novogyne
    
    
    9,760
    
    
    
    7,318Changes in operating assets and liabilities:Decrease (increase) in trade receivable, net
    
    
    345
    
    
    
    (1,181
    )Decrease in milestone payment receivable  Shire
    
    
    25,000
    
    
    
    (Increase) decrease in accounts receivable  Novogyne, net
    
    
    (416
    )
    
    
    3,488Increase in inventories
    
    
    (1,009
    )
    
    
    (2,537
    )Decrease in prepaid income taxes
    
    
    3,405
    
    
    
    135Increase in prepaid and other current assets
    
    
    (374
    )
    
    
    (657
    )Increase in deposits and other assets
    
    
    (1
    )
    
    
    (15
    )Decrease in accounts payable and accrued expenses
    
    
    (612
    )
    
    
    (1,410
    )Decrease in accrued compensation and related liabilities
    
    
    (2,413
    )
    
    
    (3,314
    )Increase in other accrued liabilities
    
    
    1,284
    
    
    
    188Decrease in deferred contract revenue, net
    
    
    (50
    )
    
    
    (231
    )Increase in deferred license revenue
    
    
    
    
    
    
    1,000Increase in other liabilities
    
    
    252
    
    
    
    31Amounts recoverable from Shire and offset against
deferred license revenue related to Daytrana approval
    
    
    
    
    
    
    61Cash flows provided by (used in) operating activities
    
    
    30,425
    
    
    
    (276
    )Cash flows from investing activities:Purchases of property, plant and equipment, net
    
    
    (689
    )
    
    
    (2,429
    )Payments for patent development costs, net
    
    
    (66
    )
    
    
    (182
    )Purchase of company-owned life insurance
    
    
    (260
    )
    
    
    (185
    )Purchases of short-term investments
    
    
    (226,470
    )
    
    
    (285,375
    )Proceeds from sale of short-term investments
    
    
    220,953
    
    
    
    252,350Cash flows used in investing activities
    
    
    (6,532
    )
    
    
    (35,821
    )Cash flows from financing activities:Issuance of common stock from exercise of stock options
    
    
    1,412
    
    
    
    444Excess tax benefit from exercise of stock options
    
    
    195
    
    
    
    137Payments under capital leases
    
    
    (19
    )
    
    
    (30
    )Cash flows provided by financing activities
    
    
    1,588
    
    
    
    551Net increase (decrease) in cash and cash equivalents
    
    
    25,481
    
    
    
    (35,546
    )Cash and cash equivalents, beginning of period
    
    
    9,144
    
    
    
    66,964Cash and cash equivalents, end of period
    
    $
    34,625
    
    
    $
    31,418
 The accompanying notes are an integral part of these statements.
 5




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##### Table of Contents



NOVEN PHARMACEUTICALS, INC.
 
 Notes to Unaudited Condensed Financial Statements
 1.
    
    DESCRIPTION OF BUSINESS:
  ® ® ®
 2.
    
    BASIS OF PRESENTATION:
   3.
    
    RECLASSIFICATIONS:
  4.
    
    CASH FLOW INFORMATION:
  6




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##### Table of Contents



5.
    
    RECENT ACCOUNTING PRONOUNCEMENTS:
  6.
    
    INVENTORIES:
  March 31,
    
    
    December 31,2007
    
    
    2006Finished goods
    
    $
    2,132
    
    
    $
    893Work in process
    
    
    2,256
    
    
    
    2,851Raw materials
    
    
    5,272
    
    
    
    4,907Total
    
    $
    9,660
    
    
    $
    8,651
   
 7.
    
    EMPLOYEE STOCK PLANS:
  7




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##### Table of Contents



Volatility
    
    
    52.2
    %Risk free interest rate
    
    
    4.94
    %Expected life (years)
    
    
    5
  2007
    
    
    2006Marketing, general and administrative
    
    $
    739
    
    
    $
    397Research and development
    
    
    127
    
    
    
    91Cost of products sold
    
    
    122
    
    
    
    61$
    988
    
    
    $
    549Tax benefit recognized related to
compensation expense
    
    $
    309
    
    
    $
    119
   8




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##### Table of Contents



WeightedWeighted
    
    
    
    
    
    
    AverageAverage
    
    
    Aggregate
    
    
    RemainingOptions/
    
    
    Exercise
    
    
    Intrinsic
    
    
    ContractualSSARs
    
    
    Price
    
    
    Value
    
    
    TermOutstanding at
beginning of the period
    
    
    3,275
    
    
    $
    19.26Granted
    
    
    
    
    
    
    Exercised
    
    
    (88
    )
    
    
    16.42
    
    
    $
    853Canceled and expired
    
    
    (10
    )
    
    
    17.33Outstanding at end
of the period
    
    
    3,177
    
    
    $
    19.35
    
    
    $
    16,142
    
    
    
    3.8Outstanding and exercisable
at end of period
    
    
    2,059
    
    
    $
    21.12
    
    
    $
    8,179
    
    
    
    3.0Vested or expected to vest
at end of period
    
    
    2,775
    
    
    $
    19.52
    
    
    $
    13,803
    
    
    
    3.8
  8.
    
    ACCOUNTING FOR UNCERTAINTY IN INCOME TAXES:
   9




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##### Table of Contents



9.
    
    CONTRACT AND LICENSE AGREEMENTS:Daytrana
    
 Amphetamine Transdermal System
 
 10




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##### Table of Contents



10.
    
    INVESTMENT IN VIVELLE VENTURES LLC (d/b/a NOVOGYNE):
   2007
    
    
    2006Revenues:Product sales
    
    $
    5,369
    
    
    $
    3,087Royalties
    
    
    1,765
    
    
    
    1,689$
    7,134
    
    
    $
    4,776Reimbursed expenses
    
    $
    7,085
    
    
    $
    7,269
   2007
    
    
    2006Gross revenues
    
    $
    37,293
    
    
    $
    37,269Sales allowances
    
    
    4,162
    
    
    
    3,793Sales return allowances
    
    
    51
    
    
    
    1,896Sales allowances and returns
    
    
    4,213
    
    
    
    5,689Net revenues
    
    
    33,080
    
    
    
    31,580Cost of sales
    
    
    7,047
    
    
    
    7,521Selling, general and
administrative expenses
    
    
    10,133
    
    
    
    9,157Income from operations
    
    
    15,900
    
    
    
    14,902Interest income
    
    
    332
    
    
    
    152Net income
    
    $
    16,232
    
    
    $
    15,054Novens equity in earnings of Novogyne
    
    $
    4,903
    
    
    $
    4,327
  Investment in Novogyne, beginning of period
    
    $
    23,296Equity in earnings of Novogyne
    
    
    4,903Cash distributions from Novogyne
    
    
    (9,760
    )Investment in Novogyne, end of period
    
    $
    18,439
 11




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##### Table of Contents



11.
    
    SHARE REPURCHASE PROGRAM:
 
 12.
    
    COMMITMENTS AND CONTINGENCIES: HT Studies
   ® ® ® ® ®
 Supply Agreement
 ® ®
 12




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##### Table of Contents



Litigation, Claims and Assessments
 ®
 ®
 ® ®
 ® ® ®
   13




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##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of
Operations
  
    
    An executive summary of our results of operations for the
2007 Quarter;
    
    An overview of Noven and our Novogyne joint venture;
    
    A review of certain items that may affect the historical or future comparability of our
results of operations;
    
    An analysis of our results of operations and our liquidity and capital resources;
    
    A discussion of how we apply our critical accounting estimates;
    
    A discussion of recently-issued accounting standards; and
    
    An outlook that includes our current financial guidance.
  Executive Summary
 The following Executive Summary is qualified in its entirety by the more detailed discussion
and analysis of our financial condition and results of operations appearing in this Item 2 as well
as in our financial statements and related notes included in this Form 10-Q .
 
  
  
   14




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##### Table of Contents



 
 ® ®
 
 ® 
 Overview of Noven and Our Novogyne Joint Venture
  ® ® ® ® ®
 ® ® ®
  15




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##### Table of Contents



® ® ® ® ® ® ® ®
 ® ® ®
 Certain Items that May Affect Historical or Future Comparability
  Daytrana 
 
 16




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##### Table of Contents




 
   
 Amphetamine Transdermal System
 
 17




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##### Table of Contents



Results of Operations
 2007 Quarter compared to the 2006 Quarter
 Revenues
  2007
    
    
    2006
    
    
    % ChangeProduct revenues  Novogyne:Product sales
    
    $
    5,369
    
    
    $
    3,087
    
    
    
    74
    %Royalties
    
    
    1,765
    
    
    
    1,689
    
    
    
    4
    %7,134
    
    
    
    4,776
    
    
    
    49
    %Product revenues  third parties:Product sales
    
    
    8,413
    
    
    
    3,800
    
    
    
    121
    %Royalties
    
    
    59
    
    
    
    71
    
    
    
    (17
    %)8,472
    
    
    
    3,871
    
    
    
    119
    %Total product revenues
    
    
    15,606
    
    
    
    8,647
    
    
    
    80
    %Contract and license revenues:Contract
    
    
    (130
    )
    
    
    664
    
    
    
    (120
    %)License
    
    
    3,839
    
    
    
    881
    
    
    
    336
    %3,709
    
    
    
    1,545
    
    
    
    140
    %Net revenues
    
    $
    19,315
    
    
    $
    10,192
    
    
    
    90
    %
 Net Revenues
  ®
 Product Revenues  Novogyne
 ® ® ® ® ® ®
 ®
 Product Revenues  Third Parties
 ® ® ® ® 
 18




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##### Table of Contents



  
 Contract and License Revenues
  
 Gross Margin
 
  19




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##### Table of Contents



2007
    
    
    2006Overall Gross Margin:Product revenues
    
    $
    15,606
    
    
    $
    8,647Cost of products sold
    
    
    8,927
    
    
    
    6,140Gross profit (product revenues
less cost of products sold)
    
    
    6,679
    
    
    
    2,507Gross margin (gross profit as a
percentage of product revenues)
    
    
    43
    %
    
    
    29
    %
 2007
    
    
    2006Gross Margin Novogyne:Product revenues
    
    $
    7,134
    
    
    $
    4,776Cost of products sold
    
    
    2,959
    
    
    
    2,143Gross profit (product revenues
less cost of products sold)
    
    
    4,175
    
    
    
    2,633Gross margin (gross profit as a
percentage of product revenues)
    
    
    59
    %
    
    
    55
    %
 2007
    
    
    2006Gross Margin Third Parties:Product revenues
    
    $
    8,472
    
    
    $
    3,871Cost of products sold
    
    
    5,968
    
    
    
    3,997Gross profit (product revenues
less cost of products sold)
    
    
    2,504
    
    
    
    (126
    )Gross margin (gross profit as a
percentage of product revenues)
    
    
    30
    %
    
    
    (3
    %)
 
  
 20




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##### Table of Contents




      
  Operating Expenses
  2007
    
    
    2006
    
    
    % ChangeResearch and development
    
    $
    3,466
    
    
    $
    3,482
    
    
    
    0
    %Marketing, general and
administrative
    
    
    5,421
    
    
    
    4,738
    
    
    
    14
    %
 Research and Development
 
 Marketing, General and Administrative
  21




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##### Table of Contents



Other Income and Expenses
 Interest Income
  Income Taxes
   Equity in Earnings of Novogyne
  22




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##### Table of Contents



2007
    
    
    2006
    
    
    % ChangeGross revenues1
    
    $
    37,293
    
    
    $
    37,269
    
    
    
    0
    %Sales allowances
    
    
    4,162
    
    
    
    3,793
    
    
    
    10
    %Sales returns allowances
    
    
    51
    
    
    
    1,896
    
    
    
    (97
    %)Sales and returns allowances
    
    
    4,213
    
    
    
    5,689
    
    
    
    (26
    %)Net revenues
    
    
    33,080
    
    
    
    31,580
    
    
    
    5
    %Cost of sales
    
    
    7,047
    
    
    
    7,521
    
    
    
    (6
    %)Gross profit
    
    
    26,033
    
    
    
    24,059
    
    
    
    8
    %Gross margin percentage
    
    
    79
    %
    
    
    76
    %Selling, general and
administrative expenses
    
    
    10,133
    
    
    
    9,157
    
    
    
    11
    %Income from operations
    
    
    15,900
    
    
    
    14,902
    
    
    
    7
    %Interest income
    
    
    332
    
    
    
    152
    
    
    
    118
    %Net income
    
    $
    16,232
    
    
    $
    15,054
    
    
    
    8
    %Novens equity in earnings of Novogyne
    
    $
    4,903
    
    
    $
    4,327
    
    
    
    13
    %
 
 1
    
    Novogynes gross revenues, which are calculated by adding sales allowances and sales
returns allowances to net revenues, are discussed in this section because Novens management
believes it is a useful measure to evaluate and compare Novogynes sales period to period in light
of the significant historic fluctuations in Novogynes sales allowances and returns. Novogyne Net Revenues
  ® ® ® ® ® ® ®
  23




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##### Table of Contents



®
 Novogyne Gross Margin
 ®
 Novogyne Selling, General and Administrative Expenses
  Liquidity and Capital Resources
  March 31, 2007
    
    
    December 31, 2006Cash and cash equivalents
    
    $
    34,625
    
    
    $
    9,144Short-term investments
    
    
    149,869
    
    
    
    144,455Working capital
    
    
    188,603
    
    
    
    180,821
  2007
    
    
    2006Cash flows:Operating activities
    
    $
    30,425
    
    
    $
    (276
    )Investing activities
    
    
    (6,532
    )
    
    
    (35,821
    )Financing activities
    
    
    1,588
    
    
    
    551
 Operating Activities
   24




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##### Table of Contents



Investing Activities
    Financing Activities
  Short-Term and Long-Term Liquidity
     
  25




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##### Table of Contents



Aggregate Contractual Obligations
  26




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##### Table of Contents



Critical Accounting Estimates
  Accounting for Uncertainty in Income Taxes
  Recent Accounting Pronouncements
  Outlook
  
    
    acquisitions of products, companies, or technologies or other transactions;
    
    changes in Novens or Novogynes accounting or accounting principles or any of the
estimates or judgments underlying our critical accounting policies;
    
    regulatory or technological developments;
    
    changes in the supply of, demand for, or distribution of our products (including any
changes resulting from competitive products, product recalls, or new study results);
    
    negative actions with respect to our applications for methylphenidate quota or other
disruptions in supplies of raw materials;
    
    changes in our business relationships/collaborations; or
    
    changes in the economy or the health care sector generally.
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Daytrana    
 HT Product Revenues
 Gross Margin.   
 Research and Development Expense.
 Marketing, General and Administrative Expense.
 Stock-Based Compensation Expenses.
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Novogyne.
 Tax Matters.
 Capital Expenditures
 
 Item 3. Quantitative and Qualitative Disclosure About Market Risk
  
 Item 4. Controls and Procedures
 Disclosure Controls and Procedures
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Changes in Internal Control over Financial Reporting
  Certificates
  
 PART II. OTHER INFORMATION
 
 Item 1. Legal Proceedings
  ® ® ®
   
 Item 1A. Risk Factors
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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
  Total Number ofShares
    
    
    ApproximatePurchased as
    
    
    Dollar ValuePart of
    
    
    That May YetTotal Number of
    
    
    Average Price
    
    
    Publicly
    
    
    be PurchasedShares
    
    
    Paid
    
    
    Announced
    
    
    under thePurchased
    
    
    Per Share
    
    
    Program
    
    
    Program(1)January 1, 2007 to
January 31, 2007
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    23,711,040February 1, 2007 to
February 28, 2007
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    23,711,040March 1, 2007 to
March 31, 2007
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    0Totals
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    0
 
 (1)
    
    In March 2007, our Board of Directors terminated the previously announced $25.0 million
stock repurchase program. 
 Item 5. Other Information
  
 Item 6. Exhibits
 31.1
    
    Certification of Robert C. Strauss, President, Chief Executive Officer
and Chairman of the Board, pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant
to Section 302 of the Sarbanes-Oxley Act of 2002.31.2
    
    Certification of Diane M. Barrett, Vice President and Chief Financial
Officer, pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 302 of
the Sarbanes-Oxley Act of 2002.
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32.1
    
    Certification of Robert C. Strauss, President, Chief Executive Officer
and Chairman of the Board, pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant
to Section 906 of the Sarbanes-Oxley Act of 2002.*32.2
    
    Certification of Diane M. Barrett, Vice President and Chief Financial
Officer, pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002.*
 
 *
    
    Pursuant to Item 601(b)(32) of Regulation S-K, this exhibit is furnished rather than
filed with this Form 10-Q. 32




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Signatures
  NOVEN PHARMACEUTICALS, INC.Date: May 7, 2007
    
    
    
    By:
    
    /s/ Diane M. BarrettDiane M. BarrettVice President andChief Financial Officer
 33