WASHINGTON--(BUSINESS WIRE)--Jan. 4, 2005--Allied Capital Corporation (NYSE:ALD) announced it completed the buyout of Insight Pharmaceuticals Corporation on December 31, 2004. Allied Capital's investment in Insight Pharmaceuticals totals approximately $155 million, including debt securities and all of the outstanding stock of the company. Additionally, Allied Capital has committed approximately $5 million in financing that can be drawn upon by the company. Insight Pharmaceuticals is a leading marketer and distributor of well-known, over-the-counter pharmaceutical products. The company's portfolio consists of 20 diverse brands that provide relief from cough/cold, pain, allergy, and other common ailments. The products are sold through an extensive network of drug, mass, food, dollar, and convenience stores and wholesalers.

"Insight Pharmaceuticals is a solid business with well-established products, strong brand equity, and loyal consumers," said John Shulman, Managing Director of Allied Capital. "We are excited to have recruited Jeff Nugent as Insight Pharmaceuticals' new President and CEO. With more than 25 years of experience in consumer packaged goods businesses, including prior roles as CEO, we believe Jeff will build long-term value going forward. The buyout of Insight Pharmaceuticals represents another key investment within consumer products, a sector of strategic focus for Allied Capital," added Shulman.

Allied Capital had previously invested $10 million of debt securities in Insight Pharmaceuticals, which was repaid in May 2004.

Sawaya Segalas & Co. LLC, a leading consumer products investment banking firm, served as exclusive financial advisor to Insight Pharmaceuticals Corporation.

About Allied Capital

Allied Capital Corporation, a leading business development company with total assets of more than $3 billion, has paid regular, quarterly cash dividends to shareholders since 1963. Since its IPO in 1960, the company has been providing long-term debt and equity financing primarily to private, middle market companies. Allied Capital's business is to generate solid total returns from a diversified private equity and commercial real estate portfolio that invests in the American entrepreneurial economy. In serving its 138,000 shareholders, Allied Capital helps build American companies and support American jobs. The Company's private finance portfolio includes investments in over 100 companies with aggregate revenues of in excess of $11 billion, supporting more than 100,000 jobs.

Headquartered in Washington, DC, Allied Capital offers shareholders the opportunity to participate in the private equity industry through an investment in the Company's New York Stock Exchange-listed stock, which is traded under the symbol ALD. For more information, please visit www.alliedcapital.com, call Allied Capital investor relations toll-free at (888) 818-5298, or e-mail us at ir@alliedcapital.com. For all media inquiries, please call (202) 331-1112.

About Insight Pharmaceuticals Corporation

Headquartered in Blue Bell, PA, Insight Pharmaceuticals Corporation was formed to acquire and market brands in the over-the-counter pharmaceutical industry. Many of its products are well-known brands, such as Anacin, Sucrets, Nix, Bonine, Ting, Cepastat, Fiberall, Nostrilla, Allerest, Aspergum, and N'ICE. The company's top customers include WalMart, Walgreens, Amerisource, CVS, Rite Aid, McKesson, Albertson's, and Kroger. For more information, please visit www.insightpharma.com

Forward-Looking Statements

The information contained in this press release contains forward-looking statements. These forward-looking statements are subject to the inherent uncertainties in predicting future results and conditions. Certain factors could cause actual results and conditions to differ materially from those projected in these forward-looking statements, and some of these factors are enumerated in Allied Capital's periodic filings with the Securities and Exchange Commission.

    CONTACT: Allied Capital Corporation, Washington
             Dale Lynch, 202-973-6344

    SOURCE: Allied Capital Corporation