Navigation Links
Par Pharmaceutical Reports Fourth Quarter and Full Year 2008 Results
Date:3/2/2009

Reports Adjusted Q4 EPS of $0.21

WOODCLIFF LAKE, N.J., March 2 /PRNewswire-FirstCall/ -- Par Pharmaceutical Companies, Inc. (NYSE: PRX) today reported fourth quarter and full year 2008 results ended December 31, 2008.

Fourth Quarter and 2008 Results

For the fourth quarter ended December 31, 2008, Par reported total revenues of $161.3 million and a loss from continuing operations of $30.5 million, or $0.91 per share. This is compared with reported revenues of $155.1 million and income from continuing operations of $5.5 million, or $0.16 per diluted share, for the same period in 2007. For the year ended December 31, 2008, Par reported total revenues of $578.1 million and a loss from continuing operations of $45.9 million, or $1.38 per share. This is compared with reported revenues of $769.7 million and income from continuing operations of $51.1 million, or $1.47 per diluted share, for 2007.

Fourth quarter 2008 reported, or GAAP, loss from continuing operations also included the write-off of a restructuring charge of $15.4 million and other related costs of $3.8 million, $49.2 million in charges due to an unfavorable court decision and related legal fees, $5.3 million gain on non-core ANDA sales and the sale of other product rights, $4.9 million impairment charge related to various investments, and a $7.9 million gain related to early debt extinguishment. Adjusting for these items and other special items, income from continuing operations for the fourth quarter 2008 would have been $7.1 million, or $0.21 per diluted share. By comparison, fourth quarter 2007 results included a pre-tax gain of $3.1 million from Par's sale of its remaining investment in Optimer Pharmaceutical, Inc. common stock and $4.6 million of additional share-based compensation expense related to Par's employee stock option tender offer. Adjusting for these items, income from continuing operations for the fourth quarter of 2007 would have been $6.5 million, or $0.19 per diluted share.

Par's reported, or GAAP, loss from continuing operations for the year ended December 31, 2008, included the write-off of an intangible asset and certain inventories related to the trimming of its generic product portfolio of $5.5 million, a charge related to a government pricing contingency of $4.8 million, a $7.8 million net impairment charge related to various investments, $7.5 million in development milestone payments to MonoSol Rx and Alfacell, and $9.0 million of gains from the sale of non-core ANDAs and other product rights. Adjusting for these items and the fourth quarter special items, income from continuing operations for the full year ended December 31, 2008 would have been $1.8 million, or $0.05 per diluted share. By comparison, and in addition to the fourth quarter 2007 events cited above, reported GAAP income from continuing operations for the full year 2007 included a $20.0 million gain on the sale to Optimer of marketing rights to the investigational drug Difimicin (Par 101), a $4.5 million investment gain on the sale of shares of Optimer common stock, and net settlement gains of $0.6 million. These benefits were tempered by $19.2 million of costs related to business development activities in support of Strativa Pharmaceuticals, Par's branded division, a $6.0 million loss on an investment, $1.6 million of severance costs. Adjusting for these items, income from continuing operations for the full year ended December 31, 2007 would have been $55.1 million, or $1.59 per diluted share.

"Given the challenging environment of 2008, we are pleased with the operating results over the last two quarters," stated Patrick G. LePore, chairman, president and chief executive officer. "This momentum should continue into 2009 as the results of our restructuring takes hold and solid product sales continue."

2008 Restructuring Plan

In October, Par announced its plans to resize its generic division by significantly reducing its research and development expense and trimming its product portfolio resulting in a workforce reduction of approximately 190. The $15.4 million fourth quarter charge related to the restructuring will result in cash expenditures of approximately $6.0 million in 2009. Par anticipates these actions will generate annualized operating expense savings in a range near $45 million.

Revenue

Revenues for the fourth quarter 2008 increased 4.0% compared with the same period in 2007 due primarily to the launch of sumatriptan succinate injection, increased sales of metoprolol and Megace(R) ES. For the year ended December 31, 2008 total revenue decreased 24.9% to $578 million compared with the same period a year earlier as a result of a decrease in the number of new product launches, trimming of Par's generic product portfolio, increased competition in Par's generic products.

Strativa revenues increased 2.7% from the prior year to $87.1 million driven by a mid-year price increase, fees related to the co-promotion of Androgel(R), and timing of trade buying patterns offset by a more challenging reimbursement environment. Revenues from Strativa represented 15.1% of total revenues, as compared to 11.0% in 2007.

Revenues from Par's generic segment declined 28.3% for the full year 2008 to $491.1 million primarily due to competitive pressures that adversely affected the volume and pricing of certain existing products. Products which experienced significant volume and pricing declines included fluticasone, propranolol, cabergoline, various amoxicillin products, ranitidine syrup, tramadol HCl and acetaminophen tablets driven by Par's exit from the market, and lower royalty payments of ondansetron tablets, among others. These decreases were offset by higher sales of meclizine, which re-launched in July, the launch of dronabinol in July, and the launch of sumatriptan succinate in November, and increased sales of metoprolol succinate to new customers.

Gross Margin

Par's 2008 gross margin represented 30.5% of total revenues, a decrease from 34.9% in 2007. Generic product gross margin decreased to 22.2% of generic revenues in 2008 from 29.8% of generic revenues in 2007 driven by increased sales of lower margin metoprolol succinate, lower sales of existing products as mentioned above, and an impairment charge of $4.9 million for nabumetone, and lower inventory write-offs, in addition to the other factors discussed above. Strativa's gross margin increased to 77.7% of branded revenues from 76.0% in 2007 due to revenue growth discussed above.

Research and Development

Research and development (R&D) expenses decreased 23.2% from the year ended December 31, 2007, to $59.7 million, and represented 10.3% of total revenues. The decrease was due primarily to a net reduction of $11.7 million of one-time Strativa milestone payments. On-going R&D expense in support of Par's strategy to expand Strativa increased $1.7 million driven by costs related to the development of Zensana(TM). Generic R&D expense decreased $8.0 million due to lower internal development costs, lower performance incentive compensation of $4 million, and the non-recurrence of one-time costs associated with a third party development agreement.

Selling, General and Administrative

Selling, general and administrative (SG&A) expense of $137.9 million for the year ended December 31, 2008 decreased slightly from $138.2 million in 2007. The decrease in SG&A expense was primarily due to lower employee compensation, the non-recurrence of the 2007 stock option tender offer and the resulting lower stock option costs, and lower expenses relates to sales and marketing of Megace(R) ES, which offset higher legal fees, severance costs and increased outside consulting costs.

Net Income

Par reported a loss for the fourth quarter ended December 31, 2008 of $32.0 million, or $0.96 per share. This is compared with reported net income of $4.3 million, or $0.12 per share, for the same period in 2007. For the full year 2008, Par reported a loss of $47.8 million, or $1.43 per share. This is compared with reported net income of $49.9 million, or $1.43 per share in 2007.

Balance Sheet

As of December 31, 2008, Par had working capital of $193.8 million, which includes $142 million of current liabilities due to mature in September 2010.

Conference Call

Par has scheduled a conference call for Tuesday, March 3 at 9:00 am EST to discuss results for the fourth quarter and full year 2008. Par invites investors and the general public to listen to a webcast of the conference call. Access to the live webcast can be made via Par's website at http://www.parpharm.com and will be available for 30 days. The dial-in number is 888-679-8034 for domestic callers and 617-213-4847 for international callers. The access number is 28915622. A replay of the conference call will be available commencing approximately one hour after the call. The replay dial-in number is 888-286-8010 for domestic callers and 617-801-6888 for international callers. The access number is 6087603.

For a copy of Par's 2008 Annual Report on Form 10-K, visit Investors/SEC Filings on the Par web site at www.parpharm.com.

About Par

Par Pharmaceutical Companies, Inc. develops, manufactures and markets generic drugs and innovative branded pharmaceuticals for specialty markets. For press release and other company information, visit www.parpharm.com.

Safe Harbor Statement

Certain statements in this news release constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. To the extent any statements made in this news release contain information that is not historical, these statements are essentially forward-looking and, as such, are subject to known and unknown risks, uncertainties and contingencies, many of which are beyond the control of the Company, which could cause actual results and outcomes to differ materially from those expressed herein. Risk factors that might affect such forward-looking statements include those set forth in Item 1A of the Company's Annual Report on Form 10-K for the year ended December 31, 2008, in other of the Company's filings with the SEC from time to time, including Current Reports on Form 8-K, and on general industry and economic conditions. Any forward-looking statements included in this news release are made as of the date hereof only, based on information available to the Company as of the date hereof, and, subject to any applicable law to the contrary, the Company assumes no obligation to update any forward-looking statements.

                          PAR PHARMACEUTICAL COMPANIES, INC.
                             CONSOLIDATED BALANCE SHEETS
                             DECEMBER 31, 2008 AND 2007
                         (In Thousands, Except Share Data)

                                                    December 31,  December 31,
                                                           2008          2007
          ASSETS
          ------
    Current assets:
        Cash and cash equivalents                      $170,629      $200,132
        Available for sale debt and marketable
         equity securities                               93,097        85,375
        Accounts receivable, net                         83,408        64,182
        Inventories                                      42,504        84,887
        Prepaid expenses and other current assets        20,040        14,294
        Deferred income tax assets                       55,230        56,921
        Income taxes receivable                          35,397        17,516
        Total current assets                            500,305       523,307

        Property, plant and equipment, at cost
         less accumulated depreciation and
         amortization                                    79,439        82,650
        Available for sale debt and marketable
         equity securities                                1,949         6,690
        Investment in joint venture                           -         6,314
        Other investments                                     -         2,500
        Intangible assets, net                           35,208        36,059
        Goodwill                                         63,729        63,729
        Deferred financing costs and other assets         1,159         2,544
        Non-current deferred income tax assets,
         net                                             70,954        57,730
    Total assets                                       $752,743      $781,523

          LIABILITIES AND STOCKHOLDERS' EQUITY
          ------------------------------------
    Current liabilities:
        Current portion of long-term debt              $142,000      $200,000
        Accounts payable                                 22,879        32,200
        Payables due to distribution agreement
         partners                                        91,451        36,479
        Accrued salaries and employee benefits           11,850        16,596
        Accrued expenses and other current
         liabilities                                     38,352        27,518
        Total current liabilities                       306,532       312,793

    Long-term debt, less current portion                      -             -
    Other long-term liabilities                          41,581        30,975
    Commitments and contingencies                             -             -

    Stockholders' equity
        Preferred Stock, par value $0.0001 per
         share, authorized 6,000,000 shares; none
         issued and outstanding                               -             -
        Common Stock, par value $0.01 per share,
         authorized 90,000,000 shares; issued
         37,400,125 and 36,460,461 shares                   374           364
        Additional paid-in capital                      289,666       274,963
        Retained earnings                               182,427       230,195
        Accumulated other comprehensive gain
         (loss)                                             122        (1,362)
        Treasury stock, at cost 2,686,519 and
         2,604,977 shares                               (67,959)      (66,405)
        Total stockholders' equity                      404,630       437,755
    Total liabilities and stockholders' equity         $752,743      $781,523

    The accompanying notes are an integral part of these consolidated
    financial statements.

                          PAR PHARMACEUTICAL COMPANIES, INC.
                        CONSOLIDATED STATEMENTS OF OPERATIONS
                FOR THE YEARS ENDED DECEMBER 31, 2008, 2007 AND 2006
                      (In Thousands, Except Per Share Amounts)

                                                    2008      2007      2006

    Revenues:
        Net product sales                       $561,012  $739,020  $705,378
        Other product related revenues            17,103    30,646    19,790
    Total revenues                               578,115   769,666   725,168
    Cost of goods sold                           401,544   501,147   506,884
        Gross margin                             176,571   268,519   218,284
    Operating expenses:
        Research and development                  59,656    77,659    61,766
        Selling, general and administrative      137,866   138,217   148,217
        Intangible assets impairment                   -         -     1,100
        Settlements and loss contingencies, net   49,837      (945)    1,250
        Restructuring costs                       15,397         -     1,283
    Total operating expenses                     262,756   214,931   213,616
    Gain on sale of product rights and other       9,625    20,000     3,054
    Operating (loss) income                      (76,560)   73,588     7,722
    Other income (expense), net                        -       (56)      126
    Gain on extinguishment of senior
     subordinated convertible notes                7,877         -         -
    Equity in loss of joint venture                 (330)     (387)     (663)
    Loss on marketable securities and other
     investments, net                             (7,796)   (1,583)     (583)
    Interest income                                9,246    13,673     8,974
    Interest expense                              (6,259)   (6,803)   (6,781)
    (Loss) income from continuing operations
     before provision for income taxes           (73,822)   78,432     8,795
    (Benefit) provision for income taxes         (27,910)   27,322     2,054
    (Loss) income from continuing operations     (45,912)   51,110     6,741
    Discontinued operations:
    Gain from discontinued operations                505         -         -
    Provision for income taxes                     2,361     1,212       894
    (Loss) from discontinued operations           (1,856)   (1,212)     (894)
    Net (loss) income                           ($47,768)  $49,898    $5,847

    Basic (loss) earnings per share of common
     stock:
    (Loss) income from continuing operations      ($1.38)    $1.48     $0.20
    (Loss) from discontinued operations            (0.05)    (0.04)    (0.03)
    Net (loss) income                             ($1.43)    $1.44     $0.17

    Diluted (loss) earnings per share of
     common stock:
    (Loss) income from continuing operations      ($1.38)    $1.47     $0.19
    (Loss) from discontinued operations            (0.05)    (0.04)    (0.03)
    Net (loss) income                             ($1.43)    $1.43     $0.16

    Weighted average number of common shares
     outstanding:
      Basic                                       33,312    34,494    34,422
      Diluted                                     33,312    34,718    34,653



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


Related medicine news :

1. Mylan Commences Tender Offers and Consent Solicitations for Its 5.750% Senior Notes Due 2010 and 6.375% Senior Notes Due 2015 in Connection With Its Proposed Acquisition of Mercks Generic Pharmaceutical Business
2. Arena Pharmaceuticals to Present at the NewsMakers in the Biotech Industry Conference
3. Caraco Pharmaceutical Laboratories, Ltd. Announces FDA Approval to Market Generic Version of Zyloprim(R)
4. Schering-Plough/Merck Pharmaceuticals Announce FDA Filing Acceptance of New Drug Application for Loratadine/Montelukast Tablet
5. Caraco Pharmaceutical Laboratories, Ltd. Announces FDA Approval to Market Generic Version of Adipex-P(R)
6. National Pharmaceutical Council Announces New Strategic Focus, Search for New Leadership
7. Caraco Pharmaceutical Laboratories, Ltd. Announces FDA Approval to Market Generic Version of Coreg(R)
8. Provectus Pharmaceuticals, Inc. Begins Phase 2 Clinical Trial for Metastatic Melanoma
9. Par Pharmaceutical Files Form 10-K for 2006 -- Company to Hold First Analysts Meeting September 28, 2007
10. Idenix Pharmaceuticals to Present at Two Upcoming Investor Conferences
11. Pharmaceutical Manufacturing Quality: Optimizing Your Internal Process for FDA Compliance
Post Your Comments:
*Name:
*Comment:
*Email:
(Date:12/4/2016)... , ... December 03, 2016 , ... While James Earl ... serving as host for in a show called "Front Page". One of the forthcoming ... years, breast cancer rates have plummeted in large part due to early detection. Like ...
(Date:12/4/2016)... ... December 03, 2016 , ... Penrose Senior ... the Dallas area” Tuesday evening at the 26th Annual SMU Cox Dallas 100™ ... Cox School’s Caruth Institute for Entrepreneurship. Dallas 100™, co-founded by the Caruth Institute, ...
(Date:12/4/2016)... (PRWEB) , ... December 04, 2016 , ... ... undergoing major cosmetic surgery can now take advantage of a cosmetic procedure known ... skin rejuvenation treatment that reduces the appearance of age spots, fine lines, ...
(Date:12/4/2016)... ... 04, 2016 , ... Responsible dental care hinges on regular brushing of the ... results. This important necessity inspired an inventor from Las Vegas, Nev., to design the ... people break or avoid bad techniques of brushing the teeth in order to prevent ...
(Date:12/2/2016)... ... December 02, 2016 , ... Lori G. Cohen and ... office, will speak at the American Conference Institute’s 21st Drug & Medical Device ... a Lead Sponsor of the conference. , Cohen, who chairs the firm’s Pharmaceutical, Medical ...
Breaking Medicine News(10 mins):
(Date:12/2/2016)... , Dec 2, 2016 Research and ... Database" newsletter to their offering. ... , , R&D ... Merie Publishing,s proprietary R&D Drug Pipeline Database provides 24/7 online access ... drugs on the market and on investigational drug candidates in research ...
(Date:12/2/2016)... -- bioLytical Laboratories, un líder mundial en test rápidos de enfermedades ... Test , a los miembros de la Kenya Pharmaceutical Association. ... ... HIV Self Test! (PRNewsFoto/bioLytical Laboratories) ... http://photos.prnewswire.com/prnh/20161201/444905 ) bioLytical fue invitada por la Clinton Health ...
(Date:12/2/2016)... GARDENS, N.Y. , Dec. 2, 2016  LifeVac, ... will be included in the Emergency Response Training and ... are very excited to have LifeVac become part of ... Lih , Founder and CEO of LifeVac. "Having an ... LifeVac safely and effectively will help leverage our efforts ...
Breaking Medicine Technology: