Akorn Reports Record Third Quarter 2008 Revenues of $31.9 million; Earnings per Share of $0.03.LAKE FOREST, Ill. -- Akorn, Inc. (NASDAQ NASDAQ
in full National Association of Securities Dealers Automated Quotations
U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : AKRX) a specialty pharmaceutical company, today reported financial results for the third quarter ended September 30, 2008.
Total revenue for the third quarter 2008 was $31.9 million, versus $15.8 million in the third quarter 2007, and represents an increase of approximately 102%. Sequentially, third quarter 2008 revenues increased by $10.6 million or 50% versus the second quarter 2008. Ophthalmic business segment revenues totaled $5.1 million, an increase of 2% versus the prior year period. Hospital Drugs and Injectables business segment revenues (excluding DTPA DTPA diethylenetriamine pentaacetic acid; see pentetic acid.
diethylenetriamine penta-acetic acid. ) totaled $6.2 million, an increase of 50% versus the prior year period. Large year-over-year revenue increases were realized in analgesic analgesic (ăn'əljē`zĭk), any of a diverse group of drugs used to relieve pain. Analgesic drugs include the nonsteroidal anti-inflammatory drugs (NSAIDs) such as the salicylates, narcotic drugs such as morphine, and synthetic drugs and antidote/poison control product sales. Vaccine business segment revenues totaled $17.9 million, an increase of 278% versus the prior year period, when the Company initially launched its vaccine business segment. Current quarter vaccine revenues include approximately $12.8 million for Tetanus tetanus (tĕt`nəs, –ənəs) or lockjaw, acute infectious disease of the central nervous system caused by the toxins of Clostridium tetani. Diphtheria diphtheria (dĭfthēr`ēə), acute contagious disease caused by Corynebacterium diphtheriae (Klebs-Loffler bacillus) bacteria that have been infected by a bacteriophage. It begins as a soreness of the throat with fever. and $5.1 million for Flu vaccine
The flu vaccine is a vaccine to protect against the highly variable influenza virus.
The annual flu kills an estimated 36,000 people in the United States. sales. Contract Pharmaceutical Manufacturing business segment revenues totaled $2.6 million, an increase of 78% versus the prior year period, and reflect revenue from three new contract pharmaceutical manufacturing customers.
Gross profit for the third quarter 2008 was $9.9 million as compared to $3.0 million in the third quarter 2007, an increase of 234%. Sequentially, third quarter 2008 gross profit increased by $5.1 million or 105% versus the second quarter 2008. The increase in third quarter 2008 gross profit is due to growth in all business segment revenues, with vaccines contributing approximately $5.3 million of third quarter 2008 gross profit. Gross margin for the third quarter 2008 was 31.1% versus 18.8% in the third quarter 2007.
Arthur S. Przybyl, President and Chief Executive Officer stated, "We are pleased with our third quarter results and expect additional near-term catalysts to continue this momentum. Recently, in the Ophthalmics business segment, we received an NDA (Non Disclosure Agreement) An agreement signed between two parties that have to disclose confidential information to each other in order to do business. In general, the NDA states why the information is being divulged and stipulates that it cannot be used for any approval for and launched our topical anesthetic anesthetic
Agent that produces a local or general loss of sensation, including pain, and therefore is useful in surgery and dentistry. General anesthesia induces loss of consciousness, most often using hydrocarbons (e.g. , Akten[TM]. We expect Akten[TM] to become a significant revenue contributor to the Ophthalmics business segment as we pursue our objective to establish Akten[TM] as the standard of care whenever a topical anesthetic is required during an ophthalmic surgical procedure. In our Hospital Drugs and Injectables business segment, we continue to expect near term product approvals and continue to pursue a forward deployment order A planning directive from the Secretary of Defense, issued by the Chairman of the Joint Chiefs of Staff, that authorizes and directs the transfer of forces between combatant commands by reassignment or attachment. for DTPA. We believe these events will generate significant revenues for this business segment.
The results of our third quarter demonstrate the importance of vaccines to our business strategy. The incremental Additional or increased growth, bulk, quantity, number, or value; enlarged.
Incremental cost is additional or increased cost of an item or service apart from its actual cost. revenues and gross profit from vaccines are the current catalysts for generating net income and positive cash flow for us. As our vaccine business model continues to mature, we expect to generate continued market share gains for both our Td and Flu vaccine products. Our recently announced agreements in our Contract Pharmaceutical Manufacturing business segment will serve to further increase revenues. Of the six new agreements announced in 2008, we have launched two and expect to launch the other four over the next twelve months. Finally, our Akorn-Strides Joint Venture launched its first product this quarter and contributed to our profitability. We have several near term product launches for the JV and look forward to its continued success."
Total operating expenses Operating expenses
The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. were $7.7 million for the third quarter 2008 versus $7.8 million in the third quarter 2007. Selling, general and administrative expenses totaled $6.2 million in the third quarter 2008, an increase of $0.9 million over the third quarter 2007. This increase is primarily due to the expansion of our Sales Team from 30 to 65 representatives, which was completed in the first quarter 2008. Research and development expenses were $1.1 million in the third quarter 2008 versus $2.1 million in the comparative prior year period, reflecting lower spending for new product development milestone fees.
Interest and other income and expense for the third quarter 2008 resulted in a charge of $271K versus interest income of $140K in the third quarter 2007, and reflect higher borrowing costs and increased debt, which were partially offset by a $25K gain on the sale of fixed assets fixed assets npl → activo sg fijo
fixed assets npl → immobilisations fpl
fixed assets fix npl → .
Joint venture income of $447K was recognized in the third quarter 2008, and represents the Company's equity earnings from its 50% position in the Akorn-Strides, LLC (Logical Link Control) See "LANs" under data link protocol.
LLC - Logical Link Control joint venture. The joint venture also contributed a marketing fee of approximately $81K in the third quarter 2008, which the Company recognized as contract pharmaceutical manufacturing business segment revenue.
The Company's net income was approximately $2.4 million in the third quarter 2008, or $0.03 per fully diluted share as compared to a net loss of approximately $4.7 million in the third quarter 2007, or $0.05 per fully diluted share. This improvement reflects incremental gross profit primarily from vaccine sales and all other business segments, including the minority interest in the Akorn-Strides, LLC joint venture.
* Ophthalmics Business Segment:
* Hospital Drugs and Injectables Business Segment:
* Biologics and Vaccines Business Segment:
* Contract Pharmaceutical Manufacturing Business Segment:
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About Akorn, Inc.
Akorn, Inc. manufactures and markets sterile specialty pharmaceuticals. Akorn has manufacturing facilities located in Decatur, Illinois
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See 10-K. , as it may be updated in subsequent reports filed with the SEC. That discussion covers certain risks, uncertainties and possibly inaccurate assumptions that could cause our actual results to differ materially from expected and historical results. Other factors besides those listed there could also adversely affect our results.