Supplement Niche Remains Steady Performer for Chattem

Supplement Niche Remains Steady Performer for Chattem

CHATTANOOGA, Tenn.Over-the-counterproducts manufacturer Chattem Inc. (NASDAQ:CHTT) received a steady first quarterperformance from its line of dietary supplement products, including Dexatrim,Garlique and New Phase. As a category, supplement sales inched up 2 percent to$8.7 million compared to the same quarter a year ago. Menopausal supplement NewPhase achieved a 34-percent sales growth in the quarter, due largely to theintroduction of an extra strength variety; however, Garlique sales fell 7percent versus a year ago, and the company took a $2.8 million pre-taxsettlement charge related to Dexatrim litigation settled in first quarter 2005.Two lawsuits and three claims alleged injuries from ephedrine-containingDexatrim products. Two additional Dexatrim lawsuits are pending.