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TheStreet Open House

Akorn Reports Third Quarter 2012 Financial Results

Consolidated revenue for the third quarter of 2012 was $69.6 million, up 90% over the comparable prior year quarter consolidated revenue of $36.7 million. Growth came from market share gains in established products; new products, such as oral vancomycin; the relaunch of certain injectable and ophthalmic products, and the acquisitions of Lundbeck products and certain assets of Kilitch Drugs (India) Limited, partially offset by decreases in our U.S. contract services revenue.

Consolidated gross margin for the third quarter of 2012 was 57.6% compared to 59.9% in the comparable prior year period. Gross margin for the third quarter of 2012, excluding the impact of Akorn India, was 61.8%. Sustained improvements in gross margin are the result of favorable product mix, the acquisition of higher margin products from Lundbeck, and higher utilization of plant capacities.

Net income for the third quarter of 2012 was $13.8 million, or $0.12 per diluted share compared to net income of $13.5 million, or $0.13 per diluted share in the comparable prior year quarter. Third quarter 2011 net income included an income tax benefit of $6.2 million, or $0.06 per diluted share. The benefit resulted from the reversal of the reserve on the Company’s deferred tax assets based on the determination that the Company would generate earnings sufficient to realize these assets. Third quarter 2012 net income benefited from lower than anticipated R&D expense in the quarter as a result of the timing of certain development milestones and internal development activities.

Non-GAAP adjusted net income for the third quarter of 2012 was $16.0 million, or $0.14 per diluted share, compared to non-GAAP adjusted net income of $9.2 million, or $0.09 per diluted share in the comparable prior year quarter.

Third quarter 2012 non-GAAP Adjusted EBITDA was $27.9 million, up 135% compared with $11.9 million in the comparable prior year quarter. Non-GAAP financial measures are defined further below under “Non-GAAP Financial Measures.”

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