BRISTOL, Tenn., Feb. 28 /PRNewswire-FirstCall/ -- King Pharmaceuticals,
Inc. (NYSE: KG) today outlined the strategic repositioning efforts that the
Company has undertaken during the past year. As a result of management's
progress, the Company is confident that it is repositioned for renewed growth.
This repositioning was initiated by Brian A. Markison upon his appointment as
President and Chief Executive Officer of King in May 2004, James R. Lattanzi,
King's Chief Financial Officer, and King's executive management team.
"Since I joined King, we have worked diligently to strategically
reposition our Company. As a result, I believe King now has outstanding
prospects for growth and am truly excited about our prospects as an
independent company," stated Mr. Markison. "We have strengthened and begun
streamlining our business and King is now more focused than ever. The entire
management team and Board of Directors remain committed to moving the Company
forward and will continue to strive to unlock King's potential and create
value for our shareholders."
In June 2004, King began working diligently to rebase the Company's
operations, and identify the Company's strengths and weaknesses in order to
establish a platform for future growth. As a result of this plan, King has
already achieved a number of significant accomplishments, including:
-- Improving the effectiveness of King's sales and marketing organization
through the relocation of Commercial Operations to New Jersey,
recruiting key talent, investing in systems, right-sizing, and
improving compensation;
-- Sharpening King's Business Development focus, enabling the Company to
better evaluate and pursue strategic opportunities (such as the
Company's previously announced strategic alliance with Palatin
Technologies, Inc. to jointly develop and commercialize PT-141);
-- Reprioritizing King's R&D portfolio, with an enhanced focus on projects
with the greatest probability to deliver long-term value;
-- Aggressively reducing wholesale inventory levels of the Company's
products through the successful implementation of inventory management
agreements; and
-- Implementing new processes and policies to enhance financial controls,
institutionalize cost control and improve production planning, while
maintaining a strong balance sheet.
Also as a result of this plan, the Company expects to continue
strengthening its management team during 2005.
Over the past year, the Company has significantly restructured its
Commercial Operations organization. This process began with the hiring of
Steve Andrzejewski as Corporate Head of Commercial Operations, with
responsibility for the Company's sales, marketing, and managed care
activities. Since then, the Company has optimized the size of its sales force
and improved compensation to attract talent and reward top performers.
Additionally, the Company has strengthened its marketing, market research, and
administrative structure. With its significantly enhanced commercial
operations capability, King plans to maximize the potential of the Company's
currently marketed products as a revenue-generating platform to fund product
development and external business development.
Business Development should continue to play a major role in King's future
growth. With the addition of new talent and rigorous new acquisition
criteria, King is working to strengthen the Company's portfolio. By sensibly
adding products with significant growth potential and divesting
underperforming assets, King expects to improve the Company's long-term
prospects and build value for its shareholders.
As previously announced, King recently completed its review of the
Company's reserve for product returns. The Company intends to file on or
before March 16, 2005 its 2004 Annual Report on Form 10-K for the year ended
December 31, 2004 and its Quarterly Report on Form 10-Q for the quarter ended
September 30, 2004.
Following the filing of the Company's Form 10-Q for the third quarter of
2004 and Form 10-K for year-end 2004, the Company intends to host a conference
call and webcast to thoroughly present and discuss the Company's strategic
plan for renewed growth as an independent company.
About King Pharmaceuticals
King, headquartered in Bristol, Tennessee, is a vertically integrated
branded pharmaceutical company. King, an S&P 500 Index company, seeks to
capitalize on opportunities in the pharmaceutical industry through the
development, including through in-licensing arrangements and acquisitions, of
novel branded prescription pharmaceutical products in attractive markets and
the strategic acquisition of branded products that can benefit from focused
promotion and marketing and product life-cycle management.
About Forward-looking Statements
This release contains forward-looking statements which reflect
management's current views of future events and operations, including, but not
limited to, statements pertaining to the Company's future growth; statements
pertaining to the creation of shareholder value; statements pertaining to the
continued strengthening of the Company's management team; statements
pertaining to maximizing the potential of the Company's currently marketed
products; statements pertaining to plans for business development; statements
pertaining to the addition of new products and the divestiture of
underperforming assets; statements pertaining to the anticipated filing date
of King's Annual Report on Form 10-K for the year ended December 31, 2004 and
its Quarterly Report on Form 10-Q for the quarter ended September 30,
2004; and statements pertaining to the Company's intent to host a conference
call and webcast to discuss its strategic plan for growth. These
forward-looking statements involve certain significant risks and
uncertainties, and actual results may differ materially from the
forward-looking statements. Some important factors which may cause actual
results to differ materially from the forward-looking statements include:
dependence on King's and Wyeth Pharmaceuticals' ability to successfully market
Altace(R) (ramipril) under the co-promotion agreement between King and Wyeth;
dependence on the development and implementation of successful marketing
strategies for Altace(R) by King and Wyeth; dependence on growth of net sales
of King's branded pharmaceutical products; dependence on the successful
marketing and sales of King's products, including, but not limited to,
Altace(R), Thrombin-JMI(R) (thrombin, topical, bovine, USP), Sonata(R)
(zaleplon), Skelaxin(R) (metaxalone), and Levoxyl(R) (levothyroxine sodium
tablets, USP); dependence of the effect of generic substitution for
Levoxyl(R); dependence on royalty revenues from Adenoscan(R) (adenosine);
dependence on the extent to which the Office of the Inspector General ("OIG")
of the Department of Health and Human Services and other governmental agencies
concur with King's best estimate of the extent to which it underpaid amounts
due under Medicaid and other governmental pricing programs and King's
determination of the reasons for such underpayments; dependence on the actual
outcome of the ongoing investigations of the Company by the U.S. Securities
and Exchange Commission ("SEC") and OIG; dependence on whether King is able to
prevail in pending shareholder securities litigation; dependence on the extent
to which any governmental sanctions are imposed due to King's underpayment of
amounts due under Medicaid and other governmental pricing programs; dependence
on King's ability to continue to acquire branded products, including products
in development; dependence on the high cost and uncertainty of research,
clinical trials, and other development activities involving pharmaceutical
products, including, but not limited to, King Pharmaceuticals Research and
Development's pre-clinical and clinical pharmaceutical product development
projects; dependence on the unpredictability of the duration and results of
the U.S. Food and Drug Administration's ("FDA") review of Investigational New
Drug Applications, New Drug Applications, and Abbreviated New Drug
Applications and/or the review of other regulatory agencies worldwide;
dependence on King's ability to maintain effective patent protection for
Altace(R) through October 2008, and successfully defend against any attempt to
challenge the enforceability of patents relating to the product, including the
challenge by Cobalt Pharmaceuticals, Inc.; dependence on King's ability to
successfully defend against any potential attempt to challenge the
enforceability of patents related to Skelaxin(R), including the challenges by
Eon Labs, Inc., CorePharma LLC, and Mutual Pharmaceutical Co., Inc.;
dependence on King's ability to maintain effective patent protection for
Skelaxin(R) and successfully defend against any attempt to challenge the
enforceability of patents relating to the product; dependence on the ability
of the Company's dedicated field sales force representatives to successfully
market King's branded pharmaceutical products; dependence on whether King's
customers order pharmaceutical products in excess of normal quantities during
any quarter which could cause the Company's sales of branded pharmaceutical
products to be lower in a subsequent quarter than they would otherwise have
been; dependence of the accuracy of King's estimate of wholesale inventory
levels of its products; dependence on King's ability to continue to
successfully execute the Company's growth strategies and capitalize on
strategic opportunities for sustained long-term growth; dependence on the
availability and cost of raw materials; dependence on no material
interruptions in supply by contract manufacturers of King's products;
dependence on the potential effect on sales of the Company's existing branded
pharmaceutical products as a result of the potential development and approval
of a generic substitute for any such product or other new competitive
products; dependence on the potential effect of future acquisitions and other
transactions pursuant to the Company's growth strategies; dependence on King's
compliance with FDA and other government regulations that relate to the
Company's business; dependence on the Company's ability to file the Company's
Form 10-K for the year ended December 31, 2004 and Form 10-Q for the quarter
ended September 30, 2004 as planned; dependence on the Company's timely
completion and the outcome of its review pursuant to the Sarbanes-Oxley Act of
2002; dependence on the Company's ability to host its conference call and
webcast discussing its strategic plan as anticipated; and dependence on
changes in general economic and business conditions; changes in current
pricing levels; changes in federal and state laws and regulations; changes in
competition; unexpected changes in technologies and technological advances;
and manufacturing capacity constraints. Other important factors that may cause
actual results to differ materially from the forward-looking statements are
discussed in the "Risk Factors" section and other sections of King's Form 10-K
for the year ended December 31, 2003 and Form 10-Q for the second quarter
ended June 30, 2004 which are on file with the SEC. King does not undertake
to publicly update or revise any of its forward-looking statements even if
experience or future changes show that the indicated results or events will
not be realized.
SOURCE King Pharmaceuticals, Inc.
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CONTACT:
James E. Green, Executive Vice President,
Corporate Affairs, +1-423-989-8125
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