8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

FORM 8-K

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

April 28, 2003
(Date of earliest event reported)

SANGSTAT MEDICAL CORPORATION
(Exact name of Registrant as specified in its charter)

                          Delaware                                                                           0-22890                                                                  94-3076-069
(State of incorporation or organization)                                     (Commission File No.)                                     (IRS Employer Identification No.)

6300 Dumbarton Circle
Fremont, CA 94555
(Address of principal executive offices)

(510) 789-4300
(Registrant’s telephone number, including area code)

Item 5.                    Other Events

                                On April 28, 2003, SangStat Medical Corporation issued the attached press release announcing its sales and earnings for the period ended March 31, 2003.

Item 7.                    Exhibits.

(a)           Not applicable.

                                (b)           Not applicable.

                                (c)           Not applicable.

                                Exhibit No.                                                                                             Description                                                          

                                99.1                                         Press release dated April 28, 2003.

Item 9.                    Regulation FD Disclosure

                                Incorporated by reference is a press release issued by the Registrant on April 28, 2003, regarding earnings for the first quarter 2003, attached as Exhibit 99.1.  This information is being furnished pursuant to Item 12 – Results of Operations and Financial Condition, of Form 8-K and is being presented under Item 9 of Form 8-K in accordance with interim guidance issued by the Securities and Exchange Commission in Release Nos.  33-8216 and 34-47583.  This information is not deemed to be "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934 and is not incorporated by reference into any Securities Act registration statements.

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SIGNATURE

                                Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

                                                                                                                                SANGSTAT MEDICAL CORPORATION



                                                                                                                                By:          /s/ Stephen G. Dance                                          
                                                                                                                                                Stephen G. Dance
Date:  April 28, 2003                                                                                                             Chief Financial Officer

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EXHIBIT INDEX

Exhibit No.                                                                            Description                                                                          

99.1                         Press release dated April 28, 2003.

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EX-99.1

EXHIBIT 99.1
Contact:	Stephen G. Dance
	510-789-4304

FOR IMMEDIATE RELEASE

SANGSTAT ANNOUNCES Q1 2003 EARNINGS PER SHARE OF $0.07 ON REVENUES OF $29.5 MILLION

Fremont, Calif.- April 28, 2003 - SangStat Medical Corporation (Nasdaq: SANG) today announced first quarter 2003 earnings per share (EPS) of $0.07 and worldwide revenues of $29.5 million, an increase of 22 percent over first quarter 2002.  Sales of SangStat's lead marketed product, Thymoglobulin® [anti-Thymocyte globulin, rabbit] in North America in the first quarter of 2003 were $13.7 million, a 30 percent increase over first quarter 2002 sales.

SangStat generated $1.8 million in net income in the first quarter of 2003 and reduced its outstanding debt by $2.0 million.  SangStat ended the first quarter of 2003 with available cash, cash equivalents and short-term investments of $94.6 million.  The first quarter results included a one-time benefit to net income of $0.7 million from the favorable settlement of a lawsuit that SangStat had appealed to the French Supreme Court.

“In the first quarter of 2003 we completed the first Phase II studies of RDP58, our novel anti-inflammatory,” said Rick Murdock, Chairman, President and CEO.  “While we are proud of our continued success with Thymoglobulin in solid organ transplantation, RDP58’s promising results in ulcerative colitis may open up markets that are many times larger than those we currently access.”

Research and development expenses, including discovery research, regulatory, and clinical expenses, were $4.4 million in the first quarter of 2003 versus $4.3 million for the first quarter of 2002. Selling, general and administrative expenses in the first quarter of 2003 were $9.3 million compared to $8.0 million in the first quarter of 2002.

Thymoglobulin

Thymoglobulin sales have continued to drive SangStat’s top and bottom lines.  In the first quarter of 2003 Thymoglobulin sales in North America reached $13.7 million, an increase of 30 percent over the first quarter 2002 and an 18 percent decrease from fourth quarter 2002.  Historically, sales of Thymoglobulin are lower in the first quarter, due to seasonal trends.

SangStat currently maintains about a 50 percent dollar market share of the immunosuppressive antibody market.  Since Thymoglobulin is the price leader in the class, the Company believes its share of the patient market is significantly smaller, approximately 35 percent, leaving room for continued growth.  SangStat believes that current and future clinical studies of Thymoglobulin set the stage for continued growth in sales.  SangStat intends to initiate new studies in 2003 to assess Thymoglobulin’s effectiveness at preventing acute rejection in living-donor kidney transplants and as a conditioning agent in bone marrow transplantation (BMT). 

Gengraf™ (cyclosporine capsules)

According to IMS Health reports, end-user demand for Gengraf grew to a high of 18.6% of the cyclosporine dollar market in the first two months of the first quarter of 2003.  Gengraf has also achieved 17.9% of the prescription market, making it the leading generic cyclosporine according to IMS.  Factory sales of Gengraf in the first quarter 2003 were $7.8 million, an increase of 17 percent over first quarter 2002 and a slight increase of 1 percent over fourth quarter 2002. The Company believes that wholesaler destocking, which began in the fourth quarter of 2002, continued into the first quarter of 2003.  SangStat anticipates that wholesaler stocking and destocking issues may continue in the future.

On March 27, 2003 a federal court ruled that Gengraf® (cyclosporine) does not infringe a Novartis patent. The Delaware District Court granted a motion filed by Abbott Laboratories requesting the Court to overturn a prior jury verdict, from July 2002, that had found infringement. Novartis had sued Abbott to prevent sales of Gengraf.  Although Novartis stated its intent to pursue an appeal of the court’s ruling, this decision significantly reduced the uncertainty surrounding SangStat’s sales of Gengraf.

RDP58

SangStat completed initial Phase II studies of RDP58, its potent anti-inflammatory peptide, in the first quarter of 2003 in both ulcerative colitis (UC) and Crohn’s disease.  The preliminary results of the Phase II studies of RDP58 at 100mg, 200mg and 300mg per day in UC and Crohn’s were released on April 9, 2003.  The Phase II studies of RDP58 demonstrated a peak response rate of 77 percent and a 71 percent remission rate among patients with ulcerative colitis taking 200mg/day of active drug.  Patients with ulcerative colitis who received 300mg/day of RDP58 achieved similar response and remission rates.

Overall, both the response and remission rates were statistically significant.  In Crohn’s disease, although 66 percent of patients treated with 200mg/day of RDP58 achieved a response, the study did not yield a statistically significant dose response.  SangStat believes that additional analysis and clinical studies using higher dosing and longer administration may be needed to determine efficacy in Crohn’s disease. 

SangStat also initiated a U.S. Phase Ib study in chemotherapy-induced diarrhea in the first quarter of 2003.  In addition to RDP58, SangStat is developing second and third generation anti-inflammatory peptides and hopes to begin pre-clinical testing of new compounds later this year.

Webcast/Conference Call

SangStat will host an investor conference call today (Monday), April 28, 2003 at 4:30pm EDT (1:30pm PDT) to discuss the first quarter results.  The call can be accessed either through the call in numbers or through the audio webcast via a link on SangStat’s website at www.Sangstat.com . The access numbers for the call are as follows:

US:	888-331-0066
Int’l:	203-748-8964
Password: SangStat

The replay will be available at least until the end of the day on Friday, May 2.  It can be accessed by calling:

US:	888-566-0859
Int’l:	402-220-0449

SangStat

SangStat is a global biotechnology company focused on immunology and working to discover, develop and market high value therapeutic products in the autoimmune, hematology/oncology and immunosuppression areas.  SangStat’s U.S. headquarters are in Fremont, California.  SangStat also maintains a strong European presence, including direct sales and marketing forces in France, Germany, Italy, Spain, and the UK, and distributors throughout the rest of the world. SangStat’s stock is traded on the Nasdaq under the symbol “SANG”.  The company’s web site is located at www.sangstat.com.

This press release contains forward-looking statements that involve risks and uncertainties. Forward-looking statements reflect SangStat’s current views with respect to future events. Forward-looking statements include future financial, sales or operating results, expenses, Gengraf sales, anticipated clinical developments and timelines, and potential uses or properties of products or product candidates. Actual results may vary materially and adversely from those anticipated, believed, estimated, or otherwise indicated. Factors that could cause actual results to differ materially include, without limitation:  progress and results of the Thymoglobulin and RDP58 studies; market conditions or other developments such as new competitors; increased sales or price reductions by competitors; reduction in margin on key products; reduction in demand or failure of demand to reach anticipated levels; manufacturing matters and potential delays; increases in expenses; changes in reimbursement for products; patent and other litigation including results from the pending Gengraf litigation; licensing or product transactions; delays in clinical trial enrollment; complications or delays in conducting pre- clinical or clinical trials; problems obtaining approvals from regulatory agencies; or changes in management. For a discussion of these and other factors that might result in different outcomes, see “Risk Factors” in SangStat’s 2002 Annual Report on Form 10-K, its 2003 quarterly reports on Form 10-Q and other documents filed with the Securities and Exchange Commission. SangStat assumes no obligation to update any such forward-looking statements, risks or reasons why actual results might differ.

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SANGSTAT MEDICAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)

			Three Months Ended March 31,
			2003			2002
REVENUES:
	Net product sales		$	28,738		$	23,355
	Revenue from collaborative agreements			790			789
		Total revenues		29,528			24,144
COSTS AND OPERATING EXPENSES:
	Cost of product sales			13,684			10,623
	Research and development			4,426			4,318
	Selling, general and administrative			9,252			7,953
	Amortization of intangible assets			250			250
		Total costs and operating expenses		27,612			23,144
	Income from operations			1,916			1,000
OTHER INCOME - NET				734			111
EQUITY IN NET LOSS OF AFFILIATE				(404	)		—
INCOME FROM OPERATIONS BEFORE INCOME TAXES				2,246			1,111
INCOME TAX PROVISION				422			433
NET INCOME			$	1,824		$	678
NET INCOME PER COMMON SHARE - BASIC			$	0.07		$	0.03
NET INCOME PER COMMON SHARE - DILUTED			$	0.07		$	0.03
Shares Used in Per Share Computations - Basic				26,445			24,032
Shares Used in Per Share Computations - Diluted				26,521			24,766

	CONDENSED CONSOLIDATED BALANCE SHEET DATA:
		March 31, 2003		December 31, 2002
Cash and Equivalents and Short-term Investments		$	94,589	$	97,512
Other Current Assets			56,825		59,457
Property and Equipment - Net			5,645		5,824
Investment in Affiliate			2,632		3,036
Intangible Assets			7,392		7,642
Other Assets			18,792		18,966
	Total	$	185,875	$	192,437
Current Liabilities		$	44,990	$	43,439
Deferred Revenue			2,368		3,158
Notes Payable and Capital Leases			5,929		15,920
Stockholders’ Equity			132,588		129,920
	Total	$	185,875	$	192,437