In 2004, through a license agreement with NovaDel Pharma Inc., Par acquired the exclusive rights to market, sell and distribute NovaDel's nitroglycerin lingual spray, NitroMist(TM). In November 2006, the U.S. Food and Drug Administration approved the product, at which time the company re- evaluated the potential market for NitroMist(TM) and determined that the product no longer fit the company's long-term strategy. This product was never launched by the company. As a result, Par recorded an impairment charge of $1.0 million in the fourth quarter of 2006, related to payments made in conjunction with the product approval.
In the fourth quarter of 2006, Par sold all of its investment in Advancis Pharmaceutical Corporation common stock and recorded a $3.2 million investment gain on the sale.
Par currently has cash, cash equivalents and available for sale securities on hand of approximately $345 million. There has been no increase in the company's borrowings in 2006 or 2007. Par's cash balances are subject to fluctuation based upon the timing of payments due to the company's distribution agreement partners.
In September 2006, the company received a notice of default and in
October 2006, the company received a notice of acceleration from the
trustee of the company's 2.875% senior subordinated convertible notes due
in 2010. The company believes that it has complied with its obligations
under the indenture and therefore believes that the notice of default and
notice of acceleration are invalid and without merit. In October 2006, the
trustee filed a lawsuit alleging a breach of the indenture and demanding
certain restitution from the company. Until the matter is resolved
|SOURCE Par Pharmaceutical Companies, Inc.|
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