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Shares of



sank Wednesday, one day after the company said its chief executive had been hospitalized and that its third-quarter results fell below Wall Street estimates.

The stock fell 53 cents, or 14.6%, to $3.09, after falling as low as $3.

Late Tuesday afternoon, the Wilmington, N.C.-based drug company said Dr. Ludo J. Reynders, its president and CEO, has been hospitalized with "suspected pneumonia." While Reynders is incapacitated, the interim president and CEO will be Timothy Wright, who joined the company in April. Wright is the fourth person to hold the title of CEO or interim CEO this year.

Reynders, 50, was named president and CEO on Sept. 28. He replaced Frederick D. Sancilio, 54, the company's founder, who had been chairman, chief executive, president and chief science officer. Sancilio resigned from these positions, but he remains a nonexecutive member of the board of directors. Sancilio had resumed daily management activities in February,replacing Dr. Philip Tabbiner as CEO. Tabbiner joined aaiPharma in 2000 and became CEO in July 2002.

Also, on Tuesday, aaiPharma released third-quarter financial results in which the company reported a loss of $33.8 million, or $1.18 a share, on revenue of $43.2 million. The consensus of analysts polled by Thomson First Call had expected a loss of $9.4 million, or 19 cents a share, on revenue of $51.4 million.

For the same period last year, aaiPharma lost $9.4 million, or 34 cents a share, on revenue of $39.7 million.

The latest aaiPharma results were affected by $13.72 million in restructuring charges, covering severance payments and other employee benefit expenses, making a separation payment to Sancilio and paying lease costs for facilities and aircraft "no longer in use."

Even with the restructuring charge and a $5.3 million charge attributed to impaired assets, analyst David W. Maris still figures aaiPharma lost 55 cents a share. The company's outlook is "uncertain despite progress on some fronts," said Maris, a Banc of America Securities analyst, in a report to clients on Tuesday. "We remain cautious as management continues to provide no guidance or visibility on the company's outlook."

Maris, who remains neutral on the stock, said positive signs include a strong reduction in inventory levels at wholesalers and chain pharmacies, lower expenses and a healthy performance by aaiPharma's drug development services unit. (He doesn't own shares; his firm has had an investment banking relationship.)

The company, whose stock was as high as $31.85 on Jan. 21 and as low as $1.13 on Oct. 1, appeared to be making a small comeback in recent weeks. It chose a new CEO, renegotiated a lending agreement and hired a firm to advise on selling some assets. The stock got as high as $4.40 on Nov. 2 before it started to slide again.

The company still has a heavy debt load. As of Sept. 30, it had $323.7 million in long-term debt and shareholders' equity of $1.6 million. At the end of 2003, the long-term debt was $338.8 million and shareholders' equity was $74.7 million.