Impax Laboratories, Inc. (NASDAQ: IPXL) today reported third quarter 2013 adjusted net income of $16.6 million, or $0.25 per diluted share, compared to adjusted net income of $33.0 million, or $0.48 per diluted share in the prior year period. On a GAAP basis, the Company recorded a net loss of $0.2 million or ($0.00) per diluted share for the third quarter 2013, compared to net income of $20.0 million, or $0.29 per diluted share in the prior year period.
The decline in adjusted net income and earnings per diluted share was primarily due to the loss of exclusivity in mid-May 2013 of branded Zomig® tablet and orally disintegrating tablet (ZMT) products resulting in significantly lower profits in the third quarter 2013, compared to the prior year period. The net loss on a GAAP basis in the third quarter 2013 was primarily due to the inclusion of intangible asset impairment charges of $13.9 million and an $8.1 million increase in remediation costs related to the Hayward facility from $2.6 million in the prior year period. These items, as well as others, have been excluded from the current quarter’s adjusted net income and earnings per share. Refer to the attached “Non-GAAP Financial Measures” for a reconciliation of GAAP to non-GAAP items.
“We were able to reduce some of the third quarter 2013 decline by capturing sales with our authorized generic Trilipix® products, which we launched in mid-July. In addition, new competition on a few generic products had a less than expected impact on this quarter’s sales,” said Larry Hsu, Ph.D., president and chief executive officer of Impax Laboratories. “However, we anticipate that our fourth quarter revenues may very well be negatively impacted by this additional competition and lower authorized generic Trilipix product sales following our strong launch, compared to this quarter.”