Navigation Links
Par Pharmaceutical Reports Third Quarter 2008 Results
Date:11/6/2008

Reports Adjusted EPS of $0.26

WOODCLIFF LAKE, N.J., Nov. 6 /PRNewswire-FirstCall/ -- Par Pharmaceutical Companies, Inc. (NYSE: PRX) today announced results for the third quarter ended Sept 27, 2008.

Third Quarter and Nine Month Results

For the third quarter ended September 27, 2008, Par reported total revenues of $149.0 million and net income of $1.7 million, or $0.05 per diluted share. This is compared with reported revenues of $212.7 million and net income of $1.3 million, or $0.04 per diluted share, for the same period in 2007. For the nine months ended September 27, 2008, Par reported total revenues of $416.8 million and a net loss of $15.8 million, or $0.47 per diluted share. This is compared with reported revenues of $614.5 million and net income of $45.6 million, or $1.30 per diluted share, for 2007.

Third quarter 2008 reported net income included the write-off of an intangible asset and certain inventories related to the trimming of its current generic product portfolio of $5.4 million, a charge relating to a government pricing contingency of $4.6 million, a $2.5 million impairment charge on an investment due to the downturn in the financial markets, a $1.25 million development milestone payment to MonoSol Rx, and a $2.2 million gain from the sale of non-core ANDAs. Adjusting for these one-time items, net income for the third quarter 2008 was $8.8 million, or $0.26 per diluted share. By comparison, net income in the third quarter 2007 included $16.2 million of costs related to business development activities in support of Strativa Pharmaceuticals. Adjusting for this one-time item, net income for the third quarter 2007 was $11.1 million, or $0.32 per diluted share.

Third Quarter Financial Review

For the third quarter ended September 27, 2008, total revenues decreased 30.0% compared with the same period a year earlier as a result of increased competition on the Company's generic products and decreased net sales of Megace(R) ES.

Revenues for the generic products division during the three month period decreased 31.2% to $129.4 million compared with the same period in 2007. Lower generic revenues in 2008 were primarily due to pricing pressure, including for metoprolol, fluticasone, propranolol, ranitidine HCl syrup, various amoxicillin products, cabergoline, and many of the Company's other products. The July 2008 launches of meclizine and dronabinol partially offsetting these declines. Revenues from Strativa decreased 20.3% to $19.6 million compared with the same period in 2007 due to decreased net sales of Megace(R) ES. Net sales growth tempered in 2008 principally due to a more challenging reimbursement environment for Megace(R) ES and included a change in reimbursement status.

Par's third quarter gross margin was 34.5% of sales, compared with 31.2% in 2007. This increase is primarily attributed to increased sales of higher margin meclizine and dronabinol and lower sales of low margin product such as metoprolol, partially offset by lower royalties of ondansetron tablets and lower sales of higher margin products such as propranolol. The gross margin percentage for Strativa was 79.3% in the third quarter of 2008 compared with 78.4% in the same period in 2007, due mainly to a mid-year price increase tempered by increased rebates.

Research and development (R&D) expense decreased 58.0% to $13.8 million in the third quarter of 2008 compared with the same period in 2007, driven primarily by a net reduction in one-time milestone payments.

Third quarter selling, general and administrative (SG&A) expenses decreased by 9.6% to $30.7 million compared with the third quarter of 2007, driven by lower bonus and share-based compensation, and lower sales and marketing expenses of Megace(R) ES, tempered by an increase in legal fees.

Recent Events

On October 14, 2008, Par announced a resizing of its generic unit as part of an ongoing strategic assessment of its businesses. The Company will significantly reduce its research and development (R&D) expenses by decreasing its internal R&D effort to focus on completing products currently in development and will continue to look for opportunities with external partners. In addition, the Company is trimming its current generic product portfolio and retaining only those marketed products that deliver acceptable profit to the Company. These actions will result in a workforce reduction of approximately 190 employees. Approximately 30% of the affected positions in manufacturing, R&D, and general and administrative will be eliminated by year-end 2008 and the remaining positions by the end of the first half of 2009.

In connection with these actions, the Company expects to incur pre-tax expenses in the range of approximately $28-$38 million, which is comprised of approximately $11 million for severance and other employee-related costs; approximately $17-$18 million for asset impairments resulting from facility closures and related actions; up to approximately $2 million in inventory write-offs related to the reduction of the Company's generic product portfolio; and up to approximately $7 million for other costs. The Company expects that approximately $8-$10 million of this charge will result in cash expenditures during the fourth quarter of 2008 and the first half of 2009.

Also in October, the Company repurchased senior subordinated convertible notes that were to mature on September 30, 2010 in the aggregate principal amount of $58.0 million for approximately $50 million, including accrued interest. The notes bore interest at an annual rate of 2.875%. This repurchase will result in the write-off of approximately $0.5 million of deferred financing costs in the fourth quarter of 2008. The Company will record a gain of approximately $5 million, after tax, in the fourth quarter of 2008 related to this debt extinguishment.

Conference Call

Par has scheduled a conference call for Friday, November 7 at 9:00 am EST to discuss results for the third quarter of 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 the Company's website at http://www.parpharm.com.

The dial-in numbers for the conference call will be 888-713-4214 for domestic callers and 617-213-4866 for international callers. The passcode is 32232063. A replay of the conference call will be available for two weeks approximately one hour after the call. The dial-in numbers for the replay are 888-286-8010 for domestic callers and 617-801-6888 for international callers. When prompted, the passcode is 59063488.

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 http://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, 2007, in Item 1A of the Company's subsequent Quarterly Reports on Form 10-Q, 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.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In Thousands, Except Share Data)

(Unaudited)

September 27, December 31,

2008 2007

ASSETS

Current assets:

Cash and cash equivalents $171,623 $200,132

Available for sale debt and

marketable equity securities 116,042 85,375

Accounts receivable, net 87,723 64,182

Inventories 48,912 84,887

Prepaid expenses and other current assets 16,217 14,294

Deferred income tax assets 48,548 56,921

Income taxes receivable 24,125 17,516

Total current assets 513,190 523,307

Property, plant and equipment, at cost less

accumulated depreciation and amortization 86,321 82,650

Available for sale debt

and marketable equity securities 4,054 6,690

Investment in joint venture - 6,314

Other investments 2,500 2,500

Intangible assets, net 46,892 36,059

Goodwill 63,729 63,729

Deferred financing costs and other assets 1,855 2,544

Non-current deferred income tax assets, net 60,199 57,730

Total assets $778,740 $781,523

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:

Current portion of long-term debt $200,000 $200,000

Accounts payable 28,768 32,200

Payables due to distribution

agreement partners 44,308 36,479

Accrued salaries and employee benefits 6,312 16,596

Accrued expenses and

other current liabilities 36,778 27,518

Total current liabilities 316,166 312,793

Long-term debt, less current portion - -

Other long-term liabilities 30,772 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 37,136,872 and 36,460,461 shares 371 364

Additional paid-in capital 285,196 274,963

Retained earnings 214,378 230,195

Accumulated other comprehensive loss (403) (1,362)

Treasury stock, at cost

2,675,204 and 2,604,977 shares (67,740) (66,405)

Total stockholders' equity 431,802 437,755

Total liabilities and stockholders' equity $778,740 $781,523

The accompanying notes are an integral part of these condensed

consolidated financial statements.

PAR PHARMACEUTICAL COMPANIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In Thousands, Except Per Share Data)

(Unaudited)

Three Months Ended Nine Months Ended

September 27, September 29, September 27, September 29,

2008 2007 2008 2007

Revenues:

Net product sales $144,765 $206,923 $404,291 $589,526

Other product

related revenues 4,202 5,753 12,541 25,000

Total revenues 148,967 212,676 416,832 614,526

Cost of goods sold 97,505 146,248 290,741 403,854

Gross margin 51,462 66,428 126,091 210,672

Operating expenses:

Research and

development 13,784 32,815 46,897 61,131

Selling, general

and administrative 30,664 33,910 98,701 100,466

Settlements and

loss contingencies,

net 4,592 (367) 4,592 (945)

Total operating

expenses 49,040 66,358 150,190 160,652

Gain on sale of

product rights

and other (2,200) - (4,325) (20,000)

Operating

income (loss) 4,622 70 (19,774) 70,020

Other (expense)

income, net - - - (49)

Equity in loss

of joint venture - (107) (330) (335)

Loss on marketable

securities and other

investments, net (2,507) - (2,940) (4,643)

Interest income 2,285 3,680 7,428 10,265

Interest expense (1,667) (1,691) (5,001) (5,136)

Income (loss) from

continuing operations

before provision

for income taxes 2,733 1,952 (20,617) 70,122

Provision (benefit)

for income taxes 923 683 (5,158) 24,541

Income (loss) from

continuing operations 1,810 1,269 (15,459) 45,581

Discontinued operations:

Gain from discontinued

operations - - 505 -

Provision for

income taxes 150 - 863 -

Loss from discontinued

operations 150 - 358 -

Net income (loss) $1,660 $1,269 ($15,817) $45,581

Basic earnings

(loss) per share

of common stock:

Income (loss) from

continuing operations $0.05 $0.04 ($0.46) $1.31

Loss from discontinued

operations (0.00) - ($0.01) -

Net income (loss) $0.05 $0.04 ($0.47) $1.31

Diluted earnings

(loss) per share

of common stock:

Income (loss) from

continuing operations $0.05 $0.04 ($0.46) $1.30

Loss from discontinued

operations (0.00) - (0.01) -

Net income (loss) $0.05 $0.04 ($0.47) $1.30

Weighted average

number of common

shares outstanding:

Basic 33,322 34,738 33,282 34,677

Diluted 33,366 34,906 33,282 34,949

The accompanying notes are an integral part of these condensed

consolidated financial statements.


'/>"/>
SOURCE Par Pharmaceutical Companies, Inc.
Copyright©2008 PR Newswire.
All rights reserved

Related medicine news :

1. Tianyin Pharmaceutical Co., Inc. to Host Fiscal Year 2009 First Quarter Earnings Conference Call on Tuesday, November 11, 2008 at 8:30 a.m. EST
2. Webcast Alert: Isis Pharmaceuticals Cardiovascular Program Review
3. Caraco Pharmaceutical Laboratories, Ltd. to Market Generic Sinemet(R) Tablets
4. Alseres Pharmaceuticals, Inc. to Present at Rodman & Renshaw 10th Annual Healthcare Conference
5. Lotus Pharmaceuticals to Present at Rodman & Renshaw Conference
6. Jazz Pharmaceuticals to Present at Investor Conferences
7. Rib-X Pharmaceuticals, Inc. to Present at the Rodman & Renshaw 10th Annual Healthcare Conference
8. Trubion Pharmaceuticals Provides Announcement Dates for Third-Quarter and Nine Months Earnings Conference Call
9. NeoStem Signs Definitive Agreement to Acquire Controlling Interest in a Leading Chinese Pharmaceutical Company
10. MiddleBrook Pharmaceuticals Retains National Account Firm VCG & Associates
11. Pacira Pharmaceuticals Leverages TalentManager(R) from Salary.Com(TM) to Integrate Compensation and Performance Management Processes
Post Your Comments:
*Name:
*Comment:
*Email:
(Date:6/25/2016)... ... June 25, 2016 , ... Dr. Calvin Johnson ... Recently, he has implemented orthobiologic procedures as a method for treating his patients. ... the first doctors to perform the treatment. Orthobiologics are substances that orthopaedic surgeons ...
(Date:6/24/2016)... ... 2016 , ... A recent article published June 14 on E ... goes on to state that individuals are now more comfortable seeking to undergo not ... as calf and cheek reduction. The Los Angeles area medical group, Beverly Hills Physicians ...
(Date:6/24/2016)... ... 2016 , ... Marcy was in a crisis. Her son James, eight, was out of control. ... and physically. , “When something upset him, he couldn’t control his emotions,” remembers Marcy. ... rocks at my other children and say he was going to kill them. If ...
(Date:6/24/2016)... Francisco, CA (PRWEB) , ... June 24, 2016 ... ... CitiDent, is now offering micro-osteoperforation for accelerated orthodontic treatment. Dr. Cheng has extensive ... self-ligating Damon brackets , AcceleDent, and accelerated osteogenic orthodontics. , Micro-osteoperforation ...
(Date:6/24/2016)... , ... June 24, 2016 , ... People across the ... Genome magazine’s Code Talker Award, an essay contest in which patients and their families ... to be presented at the 2016 National Society of Genetic Counselors (NSGC) Annual Education ...
Breaking Medicine News(10 mins):
(Date:6/23/2016)... June 23, 2016 Research and Markets ... Market - Forecast to 2022" report to their offering. ... method for the patients with kidney failure, it replaces the ... from the patient,s blood and thus the treatment helps to ... chloride in balance. Increasing number of ESRD ...
(Date:6/23/2016)... , June 23, 2016 Roche (SIX: RO, ... clearance for its Elecsys BRAHMS PCT (procalcitonin) assay as ... or septic shock. With this clearance, Roche is the ... fully integrated solution for sepsis risk assessment and management. ... bacterial infection and PCT levels in blood can aid ...
(Date:6/23/2016)... Bracket , a leading clinical trial technology and specialty ... Bracket eCOA (SM) 6.0, at the 52 nd ... in Philadelphia , Pennsylvania.  A demonstration of ... its kind to fully integrate with RTSM, will be held ... a flexible platform for electronic clinical outcomes assessments that is ...
Breaking Medicine Technology: