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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K/A

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): March 28, 2002

CHATTEM, INC.
(Exact name of registrant as specified in its charter)

Tennessee
(State of incorporation) 0-5905
(Commission File No.) 62-0156300
(IRS Employer Identification No.)

1715 West 38th Street, Chattanooga, Tennessee 37409
(Address of principal executive offices, including zip code)

(423) 821-4571
(Registrant's telephone number, including area code)

Amendment No. 1

        The undersigned hereby amends Item 7 of its Current Report on Form 8-K dated March 28, 2002 and files such amended Item 7 herewith.

Item 2. Acquisition or Disposition of Assets.

        On March 28, 2002, Chattem, Inc. (the "Company") completed the acquisition of Selsun Blue®, a medicated dandruff shampoo, from Abbott Laboratories for $75 million, plus inventories. The acquisition includes worldwide rights (except India) to manufacture, sell and market Selsun Blue plus related intellectual property and certain manufacturing equipment.

        Also on March 28, 2002, the Company obtained a $60 million senior secured credit facility from a syndicate of commercial banks led by Bank of America, N.A., as agent (the "Credit Facility"). The Credit Facility includes a $15 million revolving credit facility and a $45 million term loan. The Credit Facility together with the Company's available cash was used to finance the acquisition of Selsun Blue and will be used to provide working capital and for general corporate purposes. The $45 million term loan and any outstanding loans under the revolving credit facility mature on March 28, 2007. The Credit Facility is secured by the stock of the Company's domestic subsidiaries and all present and future assets of the Company, excluding real property. The Credit Facility contains covenants, representations, warranties and other agreements by the Company that are customary in credit agreements and security instruments relating to financings of this type.

        The foregoing description does not purport to be complete and is qualified in its entirety by reference to the Asset Purchase Agreement between the Company and Abbott Laboratories which is attached hereto as Exhibit 2.1 and the Credit Agreement which is attached hereto as Exhibit 10.1, which documents are incorporated herein by reference.

Item 7. Financial Statements and Exhibits

        (a) Financial Statements of Business Acquired:

Report of Independent Public Accountants

Statement of Selsun Blue Worldwide Assets and Liabilities Acquired as of December 31, 2001

Statement of Selsun Blue Worldwide Net Sales and Product Contribution for the year ended December 31, 2001

Notes to Financial Statements

        (b) Unaudited Pro Forma Financial Information:

Unaudited Pro Forma Consolidated Balance Sheet

Notes to Unaudited Pro Forma Consolidated Balance Sheet

Unaudited Pro Forma Consolidated Statement of Income for the Year Ended November 30, 2001

Notes to Unaudited Pro Forma Consolidated Statement of Income for the Year Ended November 30, 2001

Unaudited Pro Forma Consolidated Statement of Income for the Three Months Ended February 28 2002

Notes to Unaudited Pro Forma Consolidated Statement of Income for the Three Months Ended February 28 2002

2

Independent Auditors' Report

To the Board of Directors and Stockholders
Chattem, Inc.

We have audited the accompanying statement of worldwide assets and liabilities acquired of the Selsun Blue product line (the "Product") of Abbott International ("Abbott Intl.") and Ross Products ("Ross"), which are both divisions of Abbott Laboratories ("Abbott Labs") as of December 31, 2001, and the statement of worldwide net sales and product contribution for the year then ended. These financial statements are the responsibility of Abbott Labs' management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

The accompanying financial statements reflect the worldwide assets and liabilities acquired and the worldwide net sales and product contribution attributable to the Product as described in Note 2 and are not intended to be a complete presentation of the Product's assets, liabilities, revenues or expenses.

In our opinion, the financial statements referred to above present fairly, in all material respects, the worldwide assets and liabilities acquired of the Product as described in Note 2 as of December 31, 2001 and the worldwide net sales and product contribution of the Product as described in Note 2 for the year then ended, in conformity with accounting principles generally accepted in the United States of America.

Chicago, Illinois
May 21, 2002 /s/ BDO SEIDMAN, LLP

3

Selsun Blue

Statement of Worldwide Assets and Liabilities Acquired

December 31,		2001
Assets
Inventories		$	1,439,000
Property, Plant and Equipment, net			562,000
			2,001,000
Liabilities
Accrued Expenses
	Reserve for product returns		50,000
	Reserve for promotional discounts		496,000
Total Accrued Expenses			546,000
		$	1,455,000

See accompanying notes to financial statements.

4

Selsun Blue

Statement of Worldwide Net Sales and Product Contribution

Year ended December 31,		2001
Net Sales		$	40,651,000
Cost of Goods Sold			14,491,000
Gross margin			26,160,000
Direct Expenses
	Promotion		10,098,000
	Research and development		207,000
	General and administrative		2,397,000
Total direct expenses			12,702,000
Product contribution		$	13,458,000

See accompanying notes to financial statements.

5

Selsun Blue
Notes to Financial Statements

1. Description of Business

        Abbott Intl. and Ross manufacture and market medicated shampoo. The products are sold through distributors and directly to end users primarily in the retail markets worldwide (Abbott Intl. internationally, Ross in the United Sates).

2. Basis of Presentation

        The accompanying financial statements present only the worldwide assets and liabilities acquired and the worldwide net sales and product contribution of the Product that are subject to the Asset Purchase Agreement dated March 5, 2002 between Abbott Labs and Chattem, Inc. Abbott Intl. has a fiscal year end of November 30; thus, the international net sales and product contribution amounts combined in these financial statements are for the year ended November 30, 2001. Additionally, the net sales and product contribution for India have not been included, as that country's operations were excluded from the Asset Purchase Agreement. These financial statements include all adjustments necessary for a fair presentation of the worldwide assets and liabilities acquired at December 31, 2001 and of worldwide net sales and product contribution for the year then ended. These financial statements have been prepared in accordance with Abbott Labs' accounting principles which are in accordance with accounting principles generally accepted in the United States of America.

        These financial statements set forth only the net sales and operational expenses attributable to the Product and do not purport to represent all the costs and expenses associated with a stand-alone, separate company. Accordingly, not included in operating expenses are the expenses associated with product management, legal, cash management/treasury functions and various tax services provided by Abbott Labs.

        The statement of worldwide net sales and product contribution includes amounts attributable to the manufacture, sale, promotion and advertisement of the Product. Net sales include allowances for sales returns and cash discounts. Product contribution represents net sales less cost of goods sold, distribution, promotion, advertising and other marketing expenses attributable to the Product. Included in product contribution is an allocation of certain expenses attributable to the Product. These expenses have been allocated to the Product by Abbott Labs based upon various factors which management believes are reasonable.

3. Summary of Significant Accounting Policies

        Use of Estimates    The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires the use of management's estimates.

        Inventories    Inventories, consisting of finished goods, are carried at the negotiated price charged to Ross by Abbott Intl.'s manufacturing facility in Montreal, Canada, not in excess of market.

        Property, Plant and Equipment    Capital assets consist primarily of machinery and equipment used to manufacture and package the Product.

        The machinery and equipment are primarily located at the international sites that manufacture the Product.

        Revenue Recognition    Revenue is recognized when inventory is shipped to the customer.

4. Commitments and Contingencies

        Various lawsuits, claims and proceedings of a nature considered normal to Abbott Labs are pending. Management believes that these lawsuits, claims and proceedings are without merit or will not have a material adverse effect on the Product's operating results, liquidity or financial position.

6

UNAUDITED PRO FORMA FINANCIAL INFORMATION

        The following unaudited pro forma consolidated balance sheet gives effect to the acquisition of Selsun Blue® and the borrowings under the Credit Facility (the "Transactions") as if they had occurred on February 28, 2002. The following unaudited pro forma consolidated statements of income for the year ended November 30, 2001 and the three months ended February 28, 2002 give effect to the Transactions as if they had occurred on December 1, 2001 and December 1, 2002 respectively.

        The unaudited pro forma information is presented for informational purposes only and is not necessarily indicative of the financial position and results of operations that would have been achieved had the Transactions been completed as of the dates indicated and is not necessarily indicative of the Company's future financial position or results of operations.

7

Unaudited Pro Forma Consolidated Balance Sheet
(in thousands)

			Historical Chattem as of February 28, 2002		Historical Selsun Blue as of February 28, 2002	Pro Forma Adjustments				Pro Forma
Assets
Current Assets:
	Cash and cash equivalents		40,606		—	(32,479	)	a	)	8,127
	Accounts receivable, net		28,114		—					28,114
	Refundable and deferred Income taxes		3,685							3,685
	Inventories		15,520		1,388	131		b	)	17,039
	Prepaid expense and other current assets		2,380		—					2,380
		Total current assets	90,305		1,388	(32,348	)			59,345
	Property Plant and Equipment, net		26,028		552	448		b	)	27,028
Other Non-current Assets
	Distributor and Non Compete Agreements, net		—		—	1,250		b	)	1,250
	Patents and trademarks, net		171,004		—	73,659		b	)	244,663
	Debt Issuance costs,net		7,389		—	1,098		c	)	8,487
	Other assets		1,779							1,779
		Total other non-current assets	180,172		—	76,007				256,179
Total Assets			296,505		1,940	44,107				342,552
Liabilities and Shareholders' Equity
	Accounts Payable		5,908		—					5,908
	Payable to bank		2,016		—					2,016
	Accrued liabilities		24,539		643	404		b	)	25,586
	Current Portion of Long Term Debt		—			5,250		d	)	5,250
		Total current liabilities	32,463		643	5,654				38,760
	Senior Subordinated notes, net		204,732		—					204,732
	Term Loan		—			39,750		d	)	39,750
	Revolver		—		—					—
		Long Term Debt	204,732		—	39,750				244,482
	Deferred income taxes		11,905		—					11,905
	Other Non current liabilities		1,786		—					1,786
Shareholders' Equity
	Preferred shares		—		—					—
	Net assets acquired		—		1,297	(1,297	)	e	)	—
	Common shares		1,863		—					1,863
	Paid in Surplus		65,602		—					65,602
	Accumulated deficit		(17,625	)	—					(17,625	)
	Restricted stock, net		(796	)	—					(796	)
Cumulative other comprehensive income:										—
	Foreign currency translation adjustment		(2,425	)	—					(2,425	)
	Minimum pension liability adjustment, net		(1,000	)	—					(1,000	)
		Total shareholders' equity	45,619		1,297	(1,297	)			45,619
Total Liabilities and Shareholders' Equity			296,505		1,940	44,107				342,552

8

NOTES TO UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET

a)

Amount represents cash paid in connection with the acquisition of Selsun Blue® including $1,098,455 paid for deferred financing costs related to the Credit Facility.

b)

The acquisition will be accounted for as a purchase in accordance with Statement of Financial Accounting Standards No. 141 "Business Combinations". The purchase price is being allocated to the tangible and identifiable assets and liabilities of Selsun Blue based upon preliminary estimates of their fair market values, with the remainder allocated to "Patents, trademarks, and other purchased product rights" as follows:

Purchase Price	$	76,380
Liabilities assumed		1,047
Estimated allocation to property, plant and equipment		(1,000	)
Estimated allocation to inventories		(1,518	)
Estimated allocation to distributor and non compete agreements		(1,250	)
	$	73,659

c)

Reflects the deferred financing costs related to the Credit Facility.

d)

Represents the borrowings under the Credit Facility to fund the acquisition of Selsun Blue®.

e)

Reflects the elimination of the Selsun Blue® net asset balance.

9

UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME
FOR THE YEAR ENDED NOVEMBER 30, 2001
(In thousands, except per share amounts)

			Historical Chattem For the Year Ended November 30, 2001			Historical Selsun Blue For the Year Ended December 31, 2001		Pro Forma Adjustments				Pro Forma
NET SALES			$	198,300		$	40,651	$	—			$	238,951
COSTS AND EXPENSES:
	Cost of sales			52,512			14,491		1,493		a) b)		68,496
	Advertising and promotion			77,964			10,098		250		c)		88,312
	Selling, general and administrative			34,646			2,604						37,250
		Total costs and expenses		165,122			27,193						194,058
INCOME FROM OPERATIONS				33,178			13,458						44,893
OTHER INCOME (EXPENSE):
	Interest expense			(21,856	)				(2,342	)	d)		(24,198	)
	Loss on product divestiture			—									—
	Investment and other income, net			2,218					(650	)	f)		1,568
		Total other income (expense)		(19,638	)		—						(22,630	)
Income before income taxes, extraordinary items, and accounting change				13,540			13,458						22,263
(Provision) for income taxes				(5,145	)				(3,315	)	e)		(8,460	)
Income before extraordinary gain and accounting change				8,395			13,458						13,803
Extraordinary gain on early extinguishment of debt, net of taxes				6,948									6,948
NET INCOME			$	15,343		$	13,458					$	20,751
Weighted average outstanding—Basic				8,927									8,927
Weighted average and potential dilutive outstanding				9,038									9,038
NET INCOME PER COMMON SHARE (BASIC):
	Income before extraordinary gain and accounting change		$	0.94								$	1.55
	Extraordinary gain		$	0.78								$	0.78
		Net income per common share	$	1.72								$	2.32
NET INCOME PER COMMON SHARE (DILUTED):
	Income before extraordinary gain and accounting change		$	0.93								$	1.53
	Extraordinary gain		$	0.77								$	0.77
		Net income per common share	$	1.70								$	2.30

10

NOTES TO UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME
FOR THE YEAR ENDED NOVEMBER 30, 2001
(DOLLARS IN THOUSANDS)

a)

Reflects management's estimate of the additional costs that would have been incurred during the period. As part of the acquisition of Selsun Blue®, Chattem entered into a manufacturing agreement with Abbott Laboratories, pursuant to which Chattem will pay Abbott approximately $1,449 over the amount reflected for the manufacture of Selsun Blue® in the Historical Selsun Blue® financial statements for the year ended November 30, 2001. In accordance with the manufacturing agreement Abbott will manufacture products for sale in the United States for a period not to exceed one year and three months and for products for sale outside the United States a period not to exceed two years.

b)

Represents increase in depreciation expense of $44 resulting from the write up of the fixed assets in connection with the Selsun Blue®acquisition which were assigned useful lives of ten years.

c)

Represents amortization of not to compete agreement of $150 and distributor agreements of $100 entered into as a result of the acquisition of Selsun Blue®. These assets were assigned useful lives of five years.

d)

Represents the increase in interest expense resulting from the incurrence of indebtedness under the Credit Facility of $2,122 plus amortization of deferred financing costs of $220. The deferred financing costs are being amortized over a five year period.

e)

Represents income tax expense at an effective tax rate of 38%.

f)

Represents decrease in interest income of $650 resulting from cash paid in connection with the acquisition of Selsun Blue®.

11

UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME
FOR THE THREE MONTHS ENDED FEBRUARY 28, 2002
(In thousands, except per share amounts)

			Historical Chattem for the three months ended February 28, 2002			Historical Selsun Blue for the three months ended February 28, 2002		Pro Forma Adjustments			Pro Forma
NET SALES			$	48,414		$	10,730				$	59,144
COSTS AND EXPENSES
	Cost of sales			14,461			3,255	337		a) b)		18,053
	Advertising and promotion			15,874			100	63		c)		16,037
	Selling, general and administrative			9,537			4,773					14,310
		Total costs and expenses		39,872			8,128					48,400
INCOME FROM OPERATIONS				8,542			2,602					10,744
OTHER INCOME (EXPENSE)
	Interest expense			(4,841	)		—	(533	)	d)		(5,374	)
	Investment and other income, net			106			—	(162	)	f)		(56	)
		Total other expense		(4,735	)		—					(5,430	)
Income before income taxes, extraordinary items, and accounting change				3,807			2,602					5,314
Provision for income taxes				(1,435	)		—	(573	)	e)		(2,008	)
Income before extraordinary gain and accounting change				2,372			2,602					3,306
Cumulative effect of change in accounting principle, net of taxes				(8,877	)		—					(8,877	)
NET INCOME (LOSS)			$	(6,505	)	$	2,602				$	(5,571	)
Weighted average outstanding—Basic				8,964								8,964
Weighted average and potential dilutive outstanding				9,318								9,318
NET INCOME (LOSS) PER COMMON SHARE (BASIC):
Income before extraordinary gain and accounting change			$	0.26							$	0.37
Change in accounting principle				(0.99	)							(0.99	)
Net income (loss) per common share			$	(0.73	)						$	(0.62	)
NET INCOME (LOSS) PER COMMON SHARE (DILUTED):
Income before extraordinary gain and accounting change			$	0.25							$	0.35
Change in accounting principle				(0.95	)							(0.95	)
Net income (loss) per common share			$	(0.70	)						$	(0.60	)

12

NOTES TO UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME
FOR THREE MONTHS ENDED FEBRUARY 28, 2002
(DOLLARS IN THOUSANDS)

a)

Reflects management's estimate of the additional costs that would have been incurred during the period. As part of the acquisition of Selsun Blue®, Chattem entered into a manufacturing agreement with Abbott Laboratories, pursuant to which Chattem will pay Abbott approximately $326 over the amount reflected for the manufacture of Selsun Blue® in the Historical Selsun Blue® financial statements for the three months ended February 28, 2002. In accordance with the manufacturing agreement Abbott will manufacture products for sale in the United States for a period not to exceed one year and three months and for products for sale outside the United States a period not to exceed two years.

b)

Represents increase in deprecation expense of $11 resulting from the write up of the fixed assets in connection with the Selsun Blue®acquisition which were assigned useful lives of ten years.

c)

Represents three months of amortization of not to compete agreement of $37.5 and distributor agreements of $25 entered into as a result of the acquisition of Selsun Blue®. These assets were assigned useful lives of five years.

d)

Represents the increase in interest expense resulting from the incurrence of indebtedness under the Credit Facility of $478 plus amortization of deferred financing costs of $55. The deferred financing costs are being amortized over a five year period.

e)

Represents income tax expense at an effective tax rate of 38%.

f)

Represents decrease in interest income of $162 resulting from cash paid in connection with the acquisition of Selsun Blue®.

13

        (c) Exhibits

*2.1	Asset Purchase Agreement dated March 5, 2002 by and between Abbott Laboratories and Chattem, Inc., as amended.
*10.1	Credit Agreement dated as of March 28, 2002 among Chattem, Inc., its domestic subsidiaries, identified Lenders and Bank of America, N.A., as agent.
23	Consent of independent certified public accountants.
*99.1	Press Release dated March 28, 2002.

*

Incorporated by reference from exhibit with the same number to the Registrant's Current Report on Form 8-K, as filed with the Commission on April 10, 2002.

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SIGNATURES

        Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

June 10, 2002	CHATTEM, INC.
	By:	/s/  A. ALEXANDER TAYLOR II A. Alexander Taylor II, President and Chief Operating Officer

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Amendment No. 1

Item 2. Acquisition or Disposition of Assets.
Item 7. Financial Statements and Exhibits

Selsun Blue Statement of Worldwide Assets and Liabilities Acquired
Selsun Blue Statement of Worldwide Net Sales and Product Contribution
Selsun Blue Notes to Financial Statements
UNAUDITED PRO FORMA FINANCIAL INFORMATION
SIGNATURES