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DURAMED REPORTS 1992 RESULTS; REPORTS DEPARTMENT OF JUSTICE SETTLEMENT; PREDICTS PROFIT FOR FIRST QUARTER

 CINCINNATI, May 6 /PRNewswire/ -- E. Thomas Arington, chairman and president of Duramed Pharmaceuticals, Inc. (OTC Bulletin Board: DRMD) announced the company's operating results for the fourth quarter and year ended Dec. 31, 1992. Arington stated the company has accomplished its financial goals for 1992 of reporting operating results which are at least break-even on a cash basis (exclusive of interest expense on its bank borrowing, and certain one-time charges not requiring cash outlays at this time). The net sales and net loss for the fourth quarter of 1992 were $5,382,000 and $4,074,000, respectively, resulting in net sales and loss for 1992 of $16,685,000 and $4,964,000, respectively. Included in the loss for the fourth quarter and year ended Dec. 31, 1992, are one-time charges approximating $2.3 million as further discussed below.
 The net sales and loss for the fourth quarter of 1991 were $2,256,000 and $1,656,000, respectively, resulting in net sales and loss for 1991 of $10,531,000 and $4,229,000, respectively. The fourth quarter loss includes a one-time benefit of $1,200,000 and the full 1991 loss includes a one-time benefit of $1,950,000 as further discussed below. Excluding the one-time charges in 1992 and the one-time benefits in 1991, the 1992 results show an approximate $3.5 million improvement over 1991.
 For 1992, the net loss includes a charge of $1.4 million relating to the abandonment of certain leased premises, $500,000 pertaining to the Justice Department settlement discussed below, and approximately $387,000 relating to an asset disposal. Conversely, the 1991 results included a $750,000 benefit due to the reversal of a litigation reserve and a $1.2 million benefit due to the elimination of future royalty obligations pertaining to discontinued products. After adjusting the two years' results for these non-recurring items, 1992's loss as adjusted of approximately $2.7 million compares favorably with the 1991 net loss as adjusted of approximately $6.2 million.
 Arington added that the company has settled a previously reported Department of Justice investigation. During May 1992, the company was contacted by the Office of Consumer Litigation of the Department of Justice and the United States Attorneys' Office in Baltimore (collectively "Department") concerning issues relating to the development, approval and commercial manufacturing of a number of its products. The company voluntarily has supplied documents to the Department and otherwise has cooperated with the Department. On April 26, 1993, the company entered into a plea agreement with the Department terminating the Department's inquiry with regard to the company in exchange for the plea by the company to three misdemeanor counts involving violations of certain provisions of federal law.
 The three misdemeanor counts relate to two Abbreviated New Drug Approval ("ANDA") applications filed by Duramed during March and May 1986 for Prochlorperazine Maleate and Propranolol/Hydrochlorothiazide products that were manufactured with a wet granulation process where the bio-studies accompanying the ANDAs were performed with a dry granulation process, and to a mid-1987 change made without obtaining prior approval from the FDA in the coating procedures used in the manufacture of Prochlorperazine Maleate. Under the plea agreement, the company will waive the applicable statute of limitations and pay a total fine of $500,000 ($50,000 initially, with the remainder paid over three years) and will agree to the entry of a consent decree. Under the consent decree, among other things the company will agree for a period of four years not to violate certain applicable laws, to cooperate with the Department in any investigation of former or present directors, officers or employees of the company, and to cooperate with the FDA with regard to future inspections of the company's facilities or products.
 The Department and the company will submit the plea agreement to the United States District Court for the District of Maryland for approval. In the event that the Court should reject the agreement, either party may elect to declare the agreement null and void.
 The company notes that the changes in product processing or formulation which underlie the misdemeanor counts occurred six or more years ago, before the appointment of the company's current senior management. The company believes that the actions called for in the plea agreement are in the best interests of the company and will not result in any material adverse effect upon the company. The company has been advised that the Department's investigation is one of many that has been or is being carried out in the generic drug industry and that all other completed prosecutions of generic drug companies by the Department have resulted in pleas to or convictions on felony charges and fines of up to $10 million.
 In closing, Arington stated, "We achieved our operating and regulatory objectives for 1992 which contributed to our overall recovery plan goals. The stabilization and improvement of our overall business levels coupled with a resolution of our regulatory issues has allowed us to begin focusing more on our efforts on moving the company forward. Though much remains to be accomplished in 1993 and beyond, we are encouraged by our prospects and have lost no enthusiasm for the challenges and opportunities presented by a very dynamic industry."
 The company believes the improved operating conditions achieved during 1992 are continuing during 1993. While final numbers are not yet available and the company's financial condition remains fragile, the company expects to report a modest profit (after all charges including interest) for the quarter ending March 31, 1993. The final first quarter results are expected to be reported within the next few days.
 The following table sets forth Duramed's comparative results for the years and fourth quarters ended Dec. 31, 1992 and 1991:
 Year Ended
 Dec. 31
 (In thousands except per share 1992 1991
 amounts and shares outstanding)
 Net sales $16,685 $10,531
 Cost of goods sold 12,241 8,975
 Gross profit (loss) 4,444 1,556
 Operating expenses 5,134 5,662
 Justice Department settlement 500 ---
 Forfeiture of equipment progress
 payments 387 ---
 Reversal of litigation reserve --- (750)
 Operating (loss) (1,577) (3,356)
 Other deductions (income):
 Net expense due to abandonment
 of leased facility 1,436 ---
 Gain on elimination of obligations
 under product development
 agreements --- (1,200)
 Interest expense 1,951 2,073
 Net (loss) $(4,964) $(4,229)
 Net (loss) per share of
 common stock $ (.77) $ (.67)
 Weighted average number of
 common shares outstanding 6,442,358 6,280,064
 Fourth Quarter Ended
 Dec. 31
 (In thousands except per share 1992 1991
 amounts and shares outstanding)
 Net sales $ 5,382 $ 2,256
 Cost of goods sold 4,710 2,460
 Gross profit (loss) 672 (204)
 Operating expenses 1,852 2,120
 Justice Department settlement 500 ---
 Forfeiture of equipment progress
 payments 387 ---
 Reversal of litigation reserve --- ---
 Operating (loss) (2,067) (2,324)
 Other deductions (income):
 Net expense due to abandonment
 of leased facility 1,436 ---
 Gain on elimination of obligations
 under product development
 agreements --- (1,200)
 Interest expense 571 532
 Net (loss) $(4,074) $(1,656)
 Net (loss) per share of
 common stock $ (.63) $ (.26)
 Weighted average number of
 common shares outstanding 6,495,441 6,176,941
 Duramed Pharmaceuticals, Inc. manufactures and sells generic drug products comprised of various dosages of prescription and over-the- counter drugs. The company's stock is traded on the OTC Bulletin Board under the symbol DRMD.
 -0- 5/6/93
 /CONTACT: E. Thomas Arington, chairman and chief executive officer, or Timothy J. Holt, vice president-finance, both of Duramed Pharmaceuticals, Inc., 513-731-9900/
 (DRMD)


CO: Duramed Pharmaceuticals, Inc. ST: Ohio IN: MTC SU: ERN

KL -- CL010 -- 5226 05/06/93 08:50 EDT
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Date:May 6, 1993
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