Navigation Links
Cephalon's New Product Launches Pace Record 2008 Sales
Date:2/12/2009

Company Exceeds Sales and Earnings Guidance

Company Reiterates 2009 Earnings Guidance and Introduces Q1 2009 Guidance

FRAZER, Pa., Feb. 12 /PRNewswire-FirstCall/ -- Cephalon, Inc. (Nasdaq: CEPH) today reported 2008 sales of $1.943 billion, compared to sales of $1.727 billion for 2007, exceeding the company's previously issued guidance. Basic income per common share for the full year 2008 was $3.27. Excluding amortization expense and certain other items, basic adjusted income per common share for the full year was $5.39, compared to $4.60 for 2007 and exceeds the high end of the company's earnings guidance range of $5.20 to $5.30.

Central nervous system (CNS) franchise sales for 2008 increased 15 percent compared to 2007 to $1.049 billion. Pain franchise sales declined to $501.2 million from $512.6 million in 2007 due primarily to generic competition for ACTIQ(R) (oral transmucosal fentanyl citrate) [C-II]. AMRIX(R) (cyclobenzaprine hydrochloride extended-release capsules) sales continued to ramp up with an increase of 28 percent over the third quarter of 2008. Oncology sales were $185.6 million, an increase of 100 percent over 2007 driven by the launch of TREANDA(R) (bendamustine hydrochloride) for Injection. Sales of other products were $207.6 million compared to $212.4 million for 2007.

"The growth of AMRIX and the launch of TREANDA helped 2008 sales achieve a new record for the company," said Frank Baldino, Jr., Ph.D., Chairman and CEO. "As pleased as I am with our performance in 2008, I am even more excited about our new opportunities in the field of inflammatory diseases. Recently we announced a number of deals including the worldwide license for the drug candidate LUPUZORTM, for the treatment of systemic lupus erythematosus and the option to acquire Ception Therapeutics including its drug candidate reslizumab for eosinophilic esophagitis. Our ability to move quickly when opportunities present themselves coupled with our internal pipeline positions Cephalon favorably for future growth."

The company is reiterating its guidance for 2009 total sales of $2.175 - $2.225 billion, adjusted net income of $452 - $459 million and its basic adjusted income per common share guidance of $6.50 - $6.60.

Cephalon is introducing first quarter 2009 sales guidance of $510 - $530 million, adjusted net income guidance of $89.7 - $96.6 million and basic adjusted income per common share guidance of $1.30 - $1.40.

Basic adjusted income per common share guidance for both the first quarter 2009 and full-year 2009 is reconciled below and is subject to the assumptions set forth therein.

Cephalon's management will discuss the company's fourth quarter and full year 2008 performance in a conference call with investors beginning at 5:00 p.m. U.S. EST on Thursday, February 12, 2009. To participate in the conference call, dial +1-913-661-9178 and refer to conference code number 9540364. Investors can listen to the call live by logging on to the company's website at www.cephalon.com and clicking on "Investor Information," then "Webcast." The conference call will be archived and available to investors for one week after the call.

About Cephalon, Inc.

Founded in 1987, Cephalon, Inc. is an international biopharmaceutical company dedicated to the discovery, development and commercialization of many unique products in three core therapeutic areas: central nervous system, pain, and oncology. A member of the Fortune 1000 and the S&P 500 Index, Cephalon currently employs approximately 3,000 people in the United States and Europe. U.S. sites include the company's headquarters in Frazer, Pennsylvania, and offices, laboratories or manufacturing facilities in West Chester, Pennsylvania, Salt Lake City, Utah, and suburban Minneapolis, Minnesota. The company's European headquarters are located in Maisons-Alfort, France.

The company's proprietary products in the United States include: AMRIX, TREANDA, FENTORA(R) (fentanyl buccal tablet) [C-II], PROVIGIL(R) (modafinil) Tablets [C-IV], TRISENOX(R) (arsenic trioxide) injection, GABITRIL(R) (tiagabine hydrochloride), NUVIGIL(R) (armodafinil) Tablets [C-IV] and ACTIQ. The company also markets numerous products internationally. Full prescribing information on its U.S. products is available at http://www.cephalon.com or by calling 1-800-896-5855.

In addition to historical facts or statements of current condition, this press release may contain forward-looking statements. Forward-looking statements provide Cephalon's current expectations or forecasts of future events. These may include statements regarding our opportunities in the field of inflammatory disease, current or potential drivers for our future growth, anticipated scientific progress on its research programs, development of potential pharmaceutical products, interpretation of clinical results, prospects for regulatory approval, manufacturing development and capabilities, market prospects for its products, sales and earnings guidance, and other statements regarding matters that are not historical facts. You may identify some of these forward-looking statements by the use of words in the statements such as "anticipate," "estimate," "expect," "project," "intend," "plan," "believe" or other words and terms of similar meaning. Cephalon's performance and financial results could differ materially from those reflected in these forward-looking statements due to general financial, economic, regulatory and political conditions affecting the biotechnology and pharmaceutical industries as well as more specific risks and uncertainties facing Cephalon such as those set forth in its reports on Form 8-K, 10-Q and 10-K filed with the U.S. Securities and Exchange Commission. Given these risks and uncertainties, any or all of these forward-looking statements may prove to be incorrect. Therefore, you should not rely on any such factors or forward-looking statements. Furthermore, Cephalon does not intend to update publicly any forward-looking statement, except as required by law. The Private Securities Litigation Reform Act of 1995 permits this discussion.

This press release and/or the financial results attached to this press release include "Adjusted Net Income," "Basic Adjusted Income per Common Share," "Adjusted Net Income Guidance," "Basic Adjusted Income per Common Share Guidance," and "Diluted Adjusted Income Per Common Share," amounts that are considered "non-GAAP financial measures" under SEC rules. As required, we have provided reconciliations of these measures. Additional required information is located in the Form 8-K furnished to the SEC in connection with this press release.

                        CEPHALON, INC. AND SUBSIDIARIES

                     CONSOLIDATED STATEMENTS OF OPERATIONS
                     (In thousands, except per share data)
                                  (Unaudited)

                             Three Months Ended          Year Ended
                                December 31,            December 31,
                                ------------            ------------
                                          As                       As
                                       adjusted                 adjusted
                           2008(a,b)    2007(b)    2008(a,b)     2007(b)
                           --------   ---------    --------    ---------
    REVENUES:
      Sales                $534,861     $439,497  $1,943,464   $1,727,299
      Other revenues          5,277       10,474      31,090       45,339
                              -----       ------      ------       ------
                            540,138      449,971   1,974,554    1,772,638
                            -------      -------   ---------    ---------
    COSTS AND EXPENSES:
      Cost of sales          99,523       93,721     412,234      345,691
      Research and
       development          112,039       95,037     362,208      369,115
      Selling, general and
       administrative       209,041      207,837     840,873      735,799
      Settlement reserve          -            -       7,450      425,000
      Restructuring charge    1,442            -       8,415            -
      Impairment charge      99,719            -      99,719            -
      Acquired in-process
       research and
       development           31,955            -      41,955            -
      Loss on sale of
       equipment             17,178            -      17,178        1,022
                             ------            -      ------        -----
                            570,897      396,595   1,790,032    1,876,627
                            -------      -------   ---------    ---------

    INCOME (LOSS) FROM
     OPERATIONS             (30,759)      53,376     184,522     (103,989)
                            -------       ------     -------     --------

    OTHER INCOME
     (EXPENSE):
      Interest income         1,386        9,331      16,901       32,816
      Interest expense       (2,796)      (4,561)    (28,493)     (19,833)
      Gain on extinguishment
       of debt                    -            -           -        5,319
      Gain on sale of
       investment                 -            -           -        5,791
      Other income
       (expense), net         6,392        2,884       7,880        7,653
                              -----        -----       -----        -----
                              4,982        7,654      (3,712)      31,746
                              -----        -----      ------       ------

    INCOME (LOSS) BEFORE
     INCOME TAXES AND
     MINORITY INTEREST      (25,777)      61,030     180,810      (72,243)

    INCOME TAX EXPENSE
     (BENEFIT)              (16,290)      19,269     (20,665)     121,882
                            -------       ------     -------      -------

    NET INCOME (LOSS)
     BEFORE MINORITY
     INTEREST                (9,487)      41,761     201,475     (194,125)

    NET LOSS ATTRIBUTABLE
     TO MINORITY INTEREST    21,073            -      21,073            -
                             ------           --      ------           --

    NET INCOME (LOSS)       $11,586      $41,761    $222,548    $(194,125)
                            =======      =======    ========    =========

    BASIC INCOME (LOSS)
     PER COMMON SHARE         $0.17        $0.62       $3.27       $(2.91)
                              =====        =====       =====       ======

    DILUTED INCOME (LOSS)
     PER COMMON SHARE         $0.15        $0.53       $2.92       $(2.91)
                              =====        =====       =====       ======

    WEIGHTED AVERAGE
     NUMBER OF COMMON
     SHARES OUTSTANDING      68,505       67,187      68,018       66,597
                             ======       ======      ======       ======

    WEIGHTED AVERAGE
     NUMBER OF COMMON
     SHARES OUTSTANDING-
     ASSUMING DILUTION       77,823       78,734      76,097       66,597
                             ======       ======      ======       ======


    a) We have included the operating results for Acusphere in our
    consolidated statements of operations beginning on November 3, 2008
    because Acusphere is considered a variable interest entity to which we
    are the primary beneficiary.  However, we do not have an equity interest
    in Acusphere and, therefore, we have allocated the losses attributable to
    the minority interest in Acusphere to minority interest.  For 2008, the
    losses allocated to the minority interest have been limited to the value
    of the minority interest recorded as of November 3, 2008 but will not be
    limited starting January 1, 2009.  For the year ended December 31, 2008,
    a total of $21.1 million of net losses were allocated to the minority
    interest and $11.7 million of net losses exceeded the minority interest
    value.


    b) Effective October 1, 2008, we changed our method of accounting for
    inventories previously valued using the last-in, first-out (LIFO) method
    to the first-in, first-out (FIFO) method and adjusted our results for all
    of the periods presented.



                          CEPHALON, INC. AND SUBSIDIARIES

             Reconciliation of GAAP Net Income to Adjusted Net Income
                       (In thousands, except per share data)
                                    (Unaudited)

                                                    Three Months Ended
                                                      December 31,
                                                      -------------
                                                                As adjusted
                                                    2008            2007*
                                                    ----        -----------

    GAAP NET INCOME                              $11,586          $41,761
                                                 -------          -------
      Cost of sales adjustments                   27,804 (1)       26,306 (1)
      Research and development
       adjustments                                   255 (2)        2,000 (2)
      Selling, general and administrative
       adjustments                                13,215 (3)       11,191 (3)
      Restructuring charges                        1,442 (4)           -
      Acquired in-process research and
       development                                31,955 (5)           -
      Impairment charges                          99,719 (6)           -
      Minority interest                          (14,567)(7)           -
      Loss on sale of equipment                   17,178 (8)           -
      Income taxes                               (74,918)(9)      (18,149)(9)
                                                 -------          -------
                                                 102,083           21,348

    ADJUSTED NET INCOME                         $113,669          $63,109
                                                ========          =======


    BASIC ADJUSTED INCOME PER COMMON SHARE         $1.66            $0.94
                                                   =====            =====

    DILUTED ADJUSTED INCOME PER COMMON SHARE       $1.46            $0.80
                                                   =====            =====

    WEIGHTED AVERAGE NUMBER OF COMMON
     SHARES OUTSTANDING                           68,505           67,187
                                                  ======           ======

    WEIGHTED AVERAGE NUMBER OF COMMON
     SHARES OUTSTANDING-ASSUMING DILUTION         77,823           78,734
                                                  ======           ======

    * As adjusted for the retrospective application of a change in accounting
    method for inventory from LIFO to FIFO.


    Notes to Reconciliation of GAAP Net Income (Loss) to Adjusted Net Income

    (1) To exclude the on-going amortization of acquired intangible assets
    ($23.7 million in 2008; $26.3 million in 2007), accelerated depreciation
    related to the CIMA LABS restructuring ($1.6 million in 2008), and
    accelerated depreciation related to the proposed divestiture at the
    Mitry-Mory facility ($2.5 million in 2008).

    (2) To exclude charges related to payments for research and development
    collaborations ($2.0 million in 2007) and accelerated depreciation related
    to the proposed divestiture at the Mitry-Mory facility ($0.2 million in
    2008).

    (3) To exclude charges related to certain employee severance costs ($7.2
    million in 2007), charges related to the termination payments due to
    Takeda Pharmaceuticals North America, Inc. ($1.0 million in 2008), charges
    related to the termination payment due to Alkermes ($11.0 million in 2008)
    and related severance ($1.2 million in 2008), and a significant one-time
    charitable contribution ($4.0 million in 2007).

    (4) To exclude costs related to the CIMA LABS restructuring announced in
    January 2008.

    (5)To exclude charges related to the acquisition of licensed technology
    from Acusphere ($17.0 million) and license rights to LUPUZOR from
    ImmuPharma PLC ($15.0 million).

    (6) To exclude the impairment of the VIVITROL intangible assets ($90.4
    million) and charges related to the impairment of Acusphere fixed assets
    ($9.3 million).

    (7) To exclude the portion of non-cash charges related to our agreement
    with Acusphere that are reflected in adjustments (5) and (6) above but do
    not affect net income because they are attributed to minority interests.

    (8) To exclude the loss on sale of equipment related to the VIVITROL
    termination.

    (9) To reflect the tax effect of pre-tax adjustments at the applicable
    tax rates and certain other tax adjustments primarily related to changes
    in valuation allowances and other changes in tax assets and liabilities.


                        CEPHALON, INC. AND SUBSIDIARIES

        Reconciliation of GAAP Net Income (Loss) to Adjusted Net Income
                     (In thousands, except per share data)
                                  (Unaudited)

                                                   Year Ended
                                                   December 31
                                                   -----------
                                                           As adjusted
                                               2008           2007*
                                               ----       -------------

    GAAP NET INCOME (LOSS)                 $222,548        $(194,125)
                                           ========        =========

      Cost of sales adjustments             139,153 (1)       90,542 (1)
      Research and development adjustments    8,268 (2)       43,500 (2)
      Selling, general and administrative
       adjustments                           43,339 (3)       11,191 (3)
      Settlement reserve                      7,450 (4)      425,000 (4)
      Gain on sale of investment                  - (5)       (5,791)(5)
      Gain on extinguishment of debt              - (6)       (5,319)(6)
      Interest expense adjustment            11,250 (7)            -
      Restructuring expense                   8,415 (8)            -
      Acquired in-process research and
       development                           41,955 (9)            -
      Impairment charge                      99,719 (10)           -
      Minority interest                     (14,567)(11)           -
      Loss on sale of equipment              17,178 (12)           -
      Income taxes                         (218,080)(13)     (58,608)(13)
                                           --------          -------
                                            144,080          500,515

    ADJUSTED NET INCOME                    $366,628         $306,390
                                           ========         ========


    BASIC ADJUSTED INCOME PER
     COMMON SHARE                             $5.39            $4.60
                                              =====            =====

    DILUTED ADJUSTED INCOME PER
     COMMON SHARE                             $4.82            $3.89
                                              =====            =====

    WEIGHTED AVERAGE NUMBER OF COMMON
    SHARES OUTSTANDING                       68,018           66,597
                                             ======           ======

    WEIGHTED AVERAGE NUMBER OF COMMON
    SHARES OUTSTANDING-ASSUMING DILUTION     76,097           78,684
                                             ======           ======

    * As adjusted for the retrospective application of a change in accounting
    method for inventory from LIFO to FIFO.


    Notes to Reconciliation of GAAP Net Income (Loss) to Adjusted Net Income

    (1) To exclude the on-going amortization of acquired intangible assets
    ($100.7 million in 2008; $90.5 million in 2007), accelerated depreciation
    related to the CIMA LABS restructuring ($7.0 million in 2008), accelerated
    depreciation related to the proposed divestiture at the Mitry-Mory
    facility ($5.4 million in 2008), and the write-off of purchase commitments
    in excess of estimated requirements ($26.0 million in 2008).

    (2) To exclude charges related to payments for research and development
    collaborations ($6.0 million in 2008; $28.5 million in 2007), other
    charges related to employee severance costs ($1.8 million in 2008), and
    accelerated depreciation related to the proposed divestiture at the
    Mitry-Mory facility ($0.5 million in 2008). In 2007, we also excluded the
    recognition of a milestone ($15.0 million) related to the FDA's acceptance
    of our NDA filing for TREANDA.

    (3) To exclude charges related to certain employee severance costs ($3.0
    million in 2008; $7.2 million in 2007), charges related to the
    termination payments due to Takeda Pharmaceuticals North America, Inc.
    ($28.2 million in 2008), charges related to the termination payment due
    to Alkermes ($11.0 million in 2008) and related severance ($1.2 million
    in 2008), and a significant one-time charitable contribution ($4.0 million
    in 2007).

    (4) In 2008, to exclude charges related to the settlement of
    investigations by the Offices of the Attorney General of Connecticut and
    Massachusetts and relator attorney fees.  In 2007, to exclude the reserve
    related to the terms of the agreement in principle reached with the U.S.
    Attorney's Office.

    (5) To exclude the pre-tax gain related to the sale of certain
    investments.

    (6) To exclude the forgiveness of a mortgage loan by the Pennsylvania
    Industrial Development Board.

    (7) To exclude the accrued interest related to the settlement reached with
    the U.S. Attorney's Office.

    (8) To exclude costs related to the CIMA LABS restructuring announced in
    January 2008.

    (9) To exclude charges related to the acquisition of licensed technology
    from Acusphere ($27.0 million) and license rights to LUPUZOR from
    ImmuPharma PLC ($15.0 million).

    (10) To exclude the impairment of the VIVITROL intangible assets ($90.4
    million) and charges related to the impairment of Acusphere fixed assets
    ($9.3 million).

    (11) To exclude the portion of non-cash charges related to our agreement
    with Acusphere that are reflected in adjustments (9) and (10) above but
    do not affect net income because they are attributed to minority
    interests.

    (12) To exclude the loss on sale of equipment related to the VIVITROL
    termination.

    (13) To reflect the tax effect of pre-tax adjustments at the applicable
    tax rates and certain other tax adjustments primarily related to changes
    in valuation allowances, the settlement of the investigations by the U.S.
    Attorney's Office and other changes in tax assets and liabilities.  The
    2008 amount includes $82.3 million of tax benefits for the settlement with
    the U.S. Attorney's Office, for which the related expense was recorded in
    2007.


                           CEPHALON, INC. AND SUBSIDIARIES

                              CONSOLIDATED SALES DETAIL
                                    (In thousands)
                                     (Unaudited)

                                        Three Months Ended
                                           December 31
                                           -----------
                                 2008                         2007
                         -----------------------    -------------------------
                        United                      United
                        States   Europe   Total     States    Europe   Total
                        ------   ------   -----     ------    ------   -----
    Sales:
      PROVIGIL        $266,209  $15,004  $281,213   $208,245 $11,237 $219,482
      GABITRIL          14,827    1,587    16,414     10,828     400   11,228
                        ------    -----    ------     ------     ---   ------
        CNS            281,036   16,591   297,627    219,073  11,637  230,710

      ACTIQ             26,020   12,807    38,827     42,310  12,027   54,337
      Generic
       OTFC             19,915      -      19,915     31,471      -    31,471
      FENTORA           38,609      -      38,609     33,912      -    33,912
      AMRIX             26,242      -      26,242      8,401      -     8,401
                        ------      -      ------      -----      -     -----
        Pain           110,786   12,807   123,593    116,094  12,027  128,121

         TREANDA        36,200      -      36,200        -       -        -
         Other
          Oncology       4,307   21,082    25,389      3,517  19,671   23,188
                         -----   ------    ------      -----  ------   ------
            Oncology    40,507   21,082    61,589      3,517  19,671   23,188

            Other       11,672   40,380    52,052     11,879  45,599   57,478
                        ------   ------    ------     ------  ------   ------

                      $444,001  $90,860  $534,861   $350,563 $88,934 $439,497
                      ========  =======  ========   ======== ======= ========


                                    %
                                Increase
                               (Decrease)
                               ----------
                           United
                           States  Europe  Total
                          -------  ------  -----
    Sales:
         PROVIGIL            28      34     28
         GABITRIL            37     297     46
           CNS               28      43     29

         ACTIQ              (39)      6    (29)
         Generic OTFC       (37)      -    (37)
         FENTORA             14       -     14
         AMRIX              212       -    212
           Pain              (5)      6     (4)

         TREANDA              -       -      -
         Other Oncology      22       7      9
            Oncology       1052       7    166

            Other            (2)    (11)    (9)

                             27       2     22



                                     Year Ended December 31
                                    ------------------------
                            2008                           2007
                   ------------------------     ---------------------------
                   United                        United
                   States   Europe    Total      States    Europe     Total
                   ------   ------    -----      ------    ------     -----
    Sales:
      PROVIGIL   $924,986  $63,432   $988,418    $801,639  $50,408   $852,047
      GABITRIL     52,441    8,256     60,697      50,642    6,668     57,310
                   ------    -----     ------      ------    -----     ------
        CNS       977,427   71,688  1,049,115     852,281   57,076    909,357

      ACTIQ       122,980   53,541    176,521     199,407   40,665    240,072
      Generic
       OTFC        95,760        -     95,760     129,033        -    129,033
      FENTORA     155,246        -    155,246     135,136        -    135,136
      AMRIX        73,641        -     73,641       8,401        -      8,401
                   ------        -     ------       -----        -      -----
        Pain      447,627   53,541    501,168     471,977   40,665    512,642

      TREANDA      75,132        -     75,132           -        -          -
      Other
       Oncology    18,566   91,919    110,485      16,561   76,316     92,877
                   ------   ------    -------      ------   ------     ------
        Oncology   93,698   91,919    185,617      16,561   76,316     92,877

        Other      49,667  157,897    207,564      52,702  159,721    212,423
                   ------  -------    -------      ------  -------    -------

               $1,568,419 $375,045 $1,943,464  $1,393,521 $333,778 $1,727,299
               ========== ======== ==========  ========== ======== ==========


                                %
                             Increase
                            (Decrease)
                            ----------
                          United
                          States   Europe  Total
                          -------  ------  -----
    Sales:
         PROVIGIL            15      26     16
         GABITRIL             4      24      6
            CNS              15      26     15

         ACTIQ              (38)     32    (26)
         Generic OTFC       (26)      -    (26)
         FENTORA             15       -     15
         AMRIX              777       -    777
            Pain             (5)     32     (2)

         TREANDA              -       -      -
         Other
          Oncology           12      20     19
            Oncology        466      20    100

            Other            (6)     (1)    (2)

                             13      12     13


                       CEPHALON, INC. AND SUBSIDIARIES

                         CONSOLIDATED BALANCE SHEETS
                      (In thousands, except share data)
                                 (Unaudited)
                                                               As adjusted
                                                December 31,   December 31,
                                                    2008          2007*
                                                    ----          ----
    CURRENT ASSETS:
       Cash and cash equivalents                  $524,459      $818,669
       Investments                                       -         7,596
       Receivables, net                            409,580       276,776
       Inventory, net                              117,297        98,996
       Deferred tax assets, net                    224,066       182,268
       Other current assets                         54,120        43,267
                                                    ------        ------
           Total current assets                  1,329,522     1,427,572

       PROPERTY AND EQUIPMENT, net                 467,449       500,396
       GOODWILL                                    445,332       476,515
       INTANGIBLE ASSETS, net                      607,332       817,828
       DEFERRED TAX ASSETS, net                    142,775       141,752
       OTHER ASSETS                                176,778       132,463
                                                   -------       -------
                                                $3,169,188    $3,496,526
                                                ==========    ==========

    CURRENT LIABILITIES:
       Current portion of long-term debt        $1,030,021    $1,237,169
       Accounts payable                             87,079        91,437
       Accrued expenses                            304,415       677,184
                                                   -------       -------
           Total current liabilities             1,421,515     2,005,790

       LONG-TERM DEBT                                3,692         3,788
       DEFERRED TAX LIABILITIES, net                77,932        56,540
       OTHER LIABILITIES                           163,123       138,084
                                                   -------       -------
           Total liabilities                     1,666,262     2,204,202
                                                 ---------     ---------

    MINORITY INTEREST                                    -             -
                                                        --            --

    STOCKHOLDERS' EQUITY:
       Common stock, $0.01 par value                   717           700
       Additional paid-in capital                2,071,607     1,934,965
       Treasury stock, at cost                    (201,705)     (158,173)
       Accumulated deficit                        (411,323)     (633,871)
       Accumulated other comprehensive income       43,630       148,703
                                                    ------       -------
           Total stockholders' equity            1,502,926     1,292,324
                                                 ---------     ---------
                                                $3,169,188    $3,496,526
                                                ==========    ==========

    * As adjusted for the retrospective application of a change in accounting
    method for inventory from LIFO to FIFO.



                       CEPHALON, INC. AND SUBSIDIARIES

                    CONSOLIDATED STATEMENTS OF CASH FLOWS
                               (In thousands)
                                 (Unaudited)

                                                        Year Ended
                                                       December 31,
                                                                 As
                                                              adjusted
                                                    2008        2007*
                                                    ----      ---------
    CASH FLOWS FROM OPERATING ACTIVITIES:
      Net income (loss)                          $222,548    $(194,125)
      Adjustments to reconcile net income
       (loss) to net cash provided by
       operating activities:
         Deferred income tax benefit              (50,889)      (2,361)
         Shortfall tax benefits from stock-
          based compensation                         (511)        (360)
         Depreciation and amortization            172,457      141,358
         Stock-based compensation expense          43,975       46,695
         Gain on forgiveness of debt                    -       (5,319)
         Gain on sale of investment                     -       (5,791)
         Loss on sales of property and
          equipment                                17,178        1,022
         Impairment charges                        99,719            -
         Acquired in-process research and
          development                              16,955            -
         Minority interest in variable
          interest entity                         (21,073)           -
         Changes in operating assets and
          liabilities:
            Receivables                          (144,975)        (601)
            Inventory                             (37,397)      (2,328)
            Other assets                           11,792      (54,838)
            Accounts payable and accrued
             expenses                            (376,232)     385,463
            Other liabilities                      44,576       76,041
                                                   ------       ------

            Net cash provided by (used
             for) operating activities             (1,877)     384,856
                                                    ------     -------

    CASH FLOWS FROM INVESTING ACTIVITIES:
      Purchases of property and equipment         (75,871)     (96,867)
      Proceeds from sale of property and
       equipment                                   16,000            -
      Investment in third party                   (31,692)           -
      Cash balance from consolidation of
       variable interest entity                     1,654            -
      Acquisition of intangible assets            (25,825)    (107,246)
      Proceeds from sale of investment                  -       12,291
      Sales and maturities of available-
       for-sale investments                         7,596       99,131
      Purchases of available-for-sale
       investments                                      -      (80,255)
                                                        -      -------

          Net cash used for investing
           activities                            (108,138)    (172,946)
                                                 --------     --------

    CASH FLOWS FROM FINANCING ACTIVITIES:
       Proceeds from exercises of common stock
        options                                    43,962       93,900
       Windfall tax benefits from stock-based
        compensation                                7,834       13,993
       Acquisition of treasury stock               (6,947)      (7,105)
       Payments on and retirements of long-
        term debt                                (217,743)      (3,853)
                                                 --------       ------

           Net cash (used for) provided by
            financing activities                 (172,894)      96,935
                                                 --------       ------

    EFFECT OF EXCHANGE RATE CHANGES ON CASH
     AND CASH EQUIVALENTS                         (11,301)      13,312
                                                  -------       ------

    NET INCREASE (DECREASE) IN CASH AND CASH
     EQUIVALENTS                                 (294,210)     322,157

    CASH AND CASH EQUIVALENTS, BEGINNING OF
     PERIOD                                       818,669      496,512
                                                  -------      -------

    CASH AND CASH EQUIVALENTS, END OF PERIOD     $524,459     $818,669
                                                 ========     ========

    * As adjusted for the retrospective application of a change in accounting
    method for inventory from LIFO to FIFO.



                         CEPHALON, INC. AND SUBSIDIARIES

         Reconciliation of Projected GAAP Basic Income per Common Share
               to Basic Adjusted Income Per Common Share Guidance
                                   (Unaudited)

                                           Three Months      Twelve Months
                                               Ended             Ended
                                          March 31, 2009   December 31, 2009
                                          --------------   -----------------

    Projected GAAP basic income per
     common share                         $0.93  -  $1.03   $5.02  -  $5.12
                                          =====     =====   =====     =====

    Amortization of current
     intangibles                          $0.31  -  $0.31   $1.23  -  $1.23
    Accelerated depreciation adjustment-
      CIMA                                $0.02  -  $0.02   $0.09  -  $0.09
    Accelerated depreciation
     adjustment- Mitry-Mory               $0.06  -  $0.06   $0.22  -  $0.22
    Restructuring adjustments             $0.02  -  $0.02   $0.07  -  $0.07
    Interest expense adjustment for
     APB 14-1                             $0.16  -  $0.16   $0.67  -  $0.67

    Tax effect of pre-tax adjustments
     at the applicable tax rates         $(0.20) - $(0.20) $(0.80) - $(0.80)
                                         ------    ------  ------    ------

    Basic adjusted income per common
     share guidance                       $1.30  -  $1.40   $6.50  -  $6.60
                                          =====     =====   =====     =====

    The company's guidance is being issued based on certain assumptions
    including:

     -- Adjusted effective tax rate of approximately 35.0 percent in 2009;
        and
     -- Weighted average number of common shares outstanding of 69.0 and 69.5
        million shares for the three months ended March 31, 2009 and the
        twelve months ended December 31, 2009, respectively.



'/>"/>
SOURCE Cephalon, Inc.
Copyright©2009 PR Newswire.
All rights reserved


Related biology technology :

1. Researchers at the University of Georgia Discover Protein is Crucial to Reproduction of Parasites Involved in Disease
2. OriGene Technologies, Inc. Establishes High Throughput Monoclonal Antibody Production Outsourcing Center in China
3. China Biologic Products Receives High-Technology Enterprise Certification to Qualify for Preferential Income Tax Rate
4. Zeus Announces Product Name Changes
5. Sagent Pharmaceuticals Announces Expansion of Cefazolin Product Line to Include Cefazolin for Injection, USP in 500mg Single-Dose Vial
6. Air Products and Alter NRG Sign JDA on Renewable Energy Projects
7. While Most Companies and Industries Struggled in 2008, LifeModeler, Inc. Used Unique Products to Post Aggressive Business Gains in All Areas
8. Novavax and Vivalis Sign a Research License Agreement to Use the EB66(R) Cell Line for the Production of Virus Like Particle Based Vaccines
9. DAZ Systems, Inc. Showcases Oracle Business Accelerator for Agile Product Lifecycle Management
10. Polymer Science Releases New Silicone Gel Adhesive Products for MD&M West
11. Cephalon Exercises Option to License Worldwide Rights to ImmuPharma Product, Lupuzor
Post Your Comments:
*Name:
*Comment:
*Email:
(Date:5/27/2016)... ... May 27, 2016 , ... Weeks after hosting a carpal tunnel syndrome workshop ... hand surgeon and founder of the Fitzmaurice Hand Institute, has announced the addition of ... a state-of-the-art technology and only 1 of about 3 currently available in the United ...
(Date:5/27/2016)... At present, the Biotech sphere is ... know that volatility is what makes this industry interesting to ... Pharmaceuticals Corp. (NASDAQ: SNTA ), CTI BioPharma Corp. ... LPTN ), and Heat Biologics Inc. (NASDAQ: HTBX ... alerts for these stocks at: http://www.activewallst.com/register/ ...
(Date:5/26/2016)... , May 26, 2016 Despite the ... value in this space. Today,s pre-market research on ActiveWallSt.com directs ... Health Inc. (NASDAQ: RDUS ), Cerus Corp. (NASDAQ: ... ARWR ), and Five Prime Therapeutics Inc. (NASDAQ: ... briefings at: http://www.activewallst.com/ On ...
(Date:5/25/2016)... San Diego, Calif. (PRWEB) , ... May 25, 2016 , ... ... San Diego area and has consistently been rated one of its top attractions. ... over the globe to participate in a unique and intimate team-building experience. , Each ...
Breaking Biology Technology:
(Date:3/11/2016)... March 11, 2016 --> ... research report "Image Recognition Market by Technology (Pattern Recognition), ... Advertising), by Deployment Type (On-Premises and Cloud), by Industry ... published by MarketsandMarkets, the global market is expected to ... 29.98 Billion by 2020, at a CAGR of 19.1%. ...
(Date:3/10/2016)... March 10, 2016   Unisys Corporation (NYSE: ... Protection (CBP) is testing its biometric identity solution at ... to help identify certain non-U.S. citizens leaving the ... test, designed to help determine the efficiency and accuracy of ... February and will run until May 2016. --> ...
(Date:3/9/2016)... 2016 Nigeria . ... than 23,000 public service employees either did not exist ... salary unlawfully.    --> Nigeria ... more than 23,000 public service employees either did not ... their salary unlawfully.    --> DERMALOG, the ...
Breaking Biology News(10 mins):