8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report: July 31, 2008
(Date of earliest event reported)

Akorn, Inc.

(Exact name of registrant as specified in its charter)

Louisiana
(State or other
jurisdiction of
incorporation) 001-32360
(Commission
File Number) 72-0717400
(I.R.S. Employer
Identification No.)

2500 MILLBROOK DRIVE
BUFFALO GROVE, ILLINOIS 60089
(Address of principal executive offices, zip code)

(847) 279-6100
(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communication pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communication pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communication pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240. 13e-4(c))

Item 2.02 Results of Operations and Financial Condition.

      On July 31, 2008, Akorn, Inc. (“Akorn”) issued a press release announcing certain results of Akorn’s financial review for the quarter ended June 30, 2008. A copy of the press release is attached hereto as Exhibit 99.1.

Item 7.01 Regulation FD Disclosure.

     Also on July 31, 2008, Arthur S. Przybyl, President and Chief Executive Officer of Akorn, and Jeffrey A. Whitnell, Chief Financial Officer of Akorn, held a conference call with investors. The scripts for this call for Mr. Przybyl and Mr. Whitnell are attached hereto as Exhibits 99.2 and 99.3, respectively.

     The information in each item of this report, including the exhibits hereto, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed to be incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

     We expressly disclaim any obligation to update these exhibits and caution that they are only accurate on the date they were presented. The inclusion of any data or statements in these exhibits does not signify that the information is considered material.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

99.1	Press Release dated July 31, 2008.
99.2	Script of Mr. Przybyl for July 31, 2008 Conference Call.
99.3	Script of Mr. Whitnell for July 31, 2008 Conference Call.

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.

Akorn, Inc.
By:	/s/ Jeffrey A. Whitnell
	Jeffrey A. Whitnell
	Chief Financial Officer, Treasurer and Secretary

Date: July 31, 2008

EX-99.1

Exhibit 99.1

At the Company:
Akorn, Inc.
Arthur S. Przybyl, President and CEO
Jeffrey A. Whitnell, CFO
(847) 279-6100

FOR IMMEDIATE RELEASE

Akorn Reports Second Quarter 2008 Financial Results

Buffalo Grove, IL, July 31, 2008 — Akorn, Inc. (NASDAQ: AKRX) a specialty pharmaceutical company, today reported financial results for the second quarter ended June 30, 2008.

Total revenue for the second quarter 2008 was $21.2 million, versus $11.6 million in the second quarter 2007, and represents an increase of approximately 82%. Sequentially, second quarter 2008 revenues increased by $6.8 million or 47% versus the first quarter 2008. Ophthalmic business segment revenues totaled $4.3 million, an increase of 10% versus the prior year period. Hospital Drugs and Injectables business segment revenues (excluding DTPA) totaled $4.9 million, a decrease of 6% versus the prior year period. Vaccine business segment revenues totaled $10.0 million. The Company did not record any Vaccine business segment revenues in the prior year period. As expected, shipments to distributors accelerated, while the Company continued to generate market share in hospitals for its unit-dose Td Vaccines. Additionally, the Company announced the receipt of a contract award for the Centers for Disease Control and Prevention (CDC) for Tetanus Diphtheria Vaccines and renegotiated its Exclusive Distribution Agreement for Td Vaccines on favorable terms. Contract Pharmaceutical Manufacturing business segment revenues totaled $2.1 million versus $2.6 million in the prior year period.

Gross profit for the second quarter 2008 was $4.8 million as compared to $2.9 million in the second quarter 2007, an increase of 67%. Sequentially, second quarter 2008 gross profit increased by $1.1 million or 29% versus the first quarter 2008. The increase in second quarter 2008 gross profit is due primarily to Td vaccine sales, which contributed an incremental $1.8 million as compared to the prior year period. Gross margin for the second quarter 2008 was 27.1%, ex-Vaccines, as compared to 24.8% in the second quarter 2007.

Arthur S. Przybyl, President and Chief Executive Officer stated, “The results of our second quarter begin to demonstrate why vaccines are an important, strategic business segment for us. The incremental revenues and gross profit from vaccines are the catalysts for generating positive cash flow in the second half of 2008. We continue to expect significant, near term product approvals in our Ophthalmic and Hospital Drugs and Injectables business segments. We believe recently announced agreements in our

Contract Pharmaceutical Manufacturing business segment may serve to further increase revenues and gross profit in the second half of 2008 and beyond. Finally, we look forward to several expected product launches, beginning in July 2008, for our Akorn-Strides Joint Venture.”

Total operating expenses were $7.5 million for the second quarter 2008 versus $7.7 million in the second quarter 2007. Selling, general and administrative expenses totaled $5.9 million in the second quarter 2008, an increase of $0.7 million over the second quarter 2007. This increase is primarily due to the expansion of our Sales Team from 30 to 65 representatives, which was completed in the first quarter 2008. Research and development expenses were $1.2 million in the second quarter 2008 versus $2.2 million in the comparative prior year period, reflecting lower spending for new product development milestone fees.

The Company’s net loss was approximately $2.8 million in the second quarter 2008, or $0.03 per fully diluted share as compared to $4.6 million in the second quarter 2007, or $0.05 per fully diluted share. This improvement reflects incremental gross profit from Vaccine sales and lower operating expenses during the period.

Company Highlights:

• Ophthalmics Business Segment:

• April 16, 2008: Akorn announced FDA approval of Ofloxacin Ophthalmic Solution USP, 0.3%.

• April 18, 2008: Akorn announced FDA approval of Diclofenac Sodium Ophthalmic Solution.

• June 4, 2008: Akorn announced the receipt of an NDA Approvable Letter for Akten^® Ophthalmic Gel 3.5%.

• Hospital Drugs and Injectables Business Segment:

• April 3, 2008: Akorn announced the signing of a supply agreement for a novel premix product with Fresenius Kabi.

• April 24, 2008: Akorn announced FDA approval of Ondansetron Injection for Akorn-Strides, LLC.

• May 23, 2008: Akorn announced FDA approval of Rifampin for Injection USP, 600 mg/vial for Akorn-Strides, LLC.

• June 26, 2008: Akorn announced FDA approvals for Famotidine Injection USP, 20 mg/2mL single-dose vials and Famotidine Injection USP, 40 mg/4mL & 200 mg/20 mL multiple-dose vials for Akorn-Strides, LLC.

• July 11, 2008: Akorn announced the first commercial product launch for the Akorn-Strides, LLC Joint Venture, Rifampin for Injection USP, 600 mg/vial.

• Biologics and Vaccines Business Segment:

• June 30, 2008: Akorn announced a CDC contract award for Tetanus Diphtheria Vaccines.

• July 14, 2008: Akorn announced an Amendment to the Exclusive Distribution Agreement for Td Vaccines.

• Contract Pharmaceutical Manufacturing Business Segment:

• July 3, 2008: Akorn announced the signing of a five-year commercial manufacturing and supply agreement with Bioniche Pharma for two injectable drug products. The anticipated launch for both products is in the second half of 2008.

• July 9, 2008: Akorn announced the signing of a ten-year exclusive manufacturing and supply agreement at our Decatur, IL facility for the contract manufacture of several injectable drug products.

AKORN, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
IN THOUSANDS

	JUNE 30,			DECEMBER 31,
	2008			2007
	(UNAUDITED)			(AUDITED)
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	1,369		$	7,948
Restricted Cash for revolving credit agreement		3,300			1,250
Trade accounts receivable (less allowance for doubtful accounts of $5 and $5, respectively)		10,101			4,112
Inventories		25,375			31,095
Prepaid expenses and other current assets		1,398			1,317
TOTAL CURRENT ASSETS		41,543			45,722
PROPERTY, PLANT AND EQUIPMENT, NET		32,137			32,262
OTHER LONG-TERM ASSETS
Intangibles, net		6,694			7,721
Other		144			1,261
TOTAL OTHER LONG-TERM ASSETS		6,838			8,982
TOTAL ASSETS	$	80,518		$	86,966
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES
Revolving line of credit	$	14,179		$	4,521
Mortgage payable		—			208
Trade accounts payable		4,431			14,070
Accrued compensation		862			895
Accrued expenses and other liabilities		1,710			1,306
TOTAL CURRENT LIABILITIES		21,182			21,000
LONG-TERM LIABILITIES
Product warranty liability		1,299			1,308
TOTAL LONG-TERM LIABILITIES		1,299			1,308
TOTAL LIABILITIES		22,481			22,308
SHAREHOLDERS’ EQUITY
Common stock, no par value — 150,000,000 shares authorized; 89,222,606 and 88,900,588 shares issued and outstanding at June 30, 2008 and December 31, 2007, respectively		167,635			165,829
Warrants to acquire common stock		2,731			2,795
Accumulated deficit		(112,329	)		(103,966	)
TOTAL SHAREHOLDERS’ EQUITY		58,037			64,658
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	80,518		$	86,966

AKORN, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
IN THOUSANDS, EXCEPT PER SHARE DATA
(UNAUDITED)

	THREE MONTHS ENDED						SIX MONTHS ENDED
	JUNE 30,						JUNE 30,
	2008			2007			2008			2007
Revenues	$	21,229		$	11,638		$	35,688		$	23,373
Cost of sales		16,402			8,752			27,114			17,998
GROSS PROFIT		4,827			2,886			8,574			5,375
Selling, general and administrative expenses		5,914			5,189			12,171			10,431
Amortization of intangibles		338			339			677			677
Research and development expenses		1,225			2,161			3,601			4,172
TOTAL OPERATING EXPENSES		7,477			7,689			16,449			15,280
OPERATING LOSS		(2,650	)		(4,803	)		(7,875	)		(9,905	)
Interest (expense)/income — net		(169	)		169			( 284	)		428
Other Income/(Expense)		—			1			( 201	)		1
LOSS BEFORE INCOME TAXES		(2,819	)		(4,633	)		(8,360	)		(9,476	)
Income tax provision		—			1			3			1
NET LOSS	$	(2,819	)	$	(4,634	)	$	(8,363	)	$	(9,477	)
NET LOSS PER SHARE:
BASIC	$	(0.03	)	$	(0.05	)	$	(0.09	)	$	(0.11	)
DILUTED	$	(0.03	)	$	(0.05	)	$	(0.09	)	$	(0.11	)
SHARES USED IN COMPUTING NET LOSS PER SHARE:
BASIC		89,204			86,982			89,129			86,619
DILUTED		89,204			86,982			89,129			86,619

AKORN, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
IN THOUSANDS
(UNAUDITED)

	SIX MONTHS
	ENDED JUNE 30
	2008			2007
OPERATING ACTIVITIES
Net loss	$	(8,363	)	$	(9,477	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		2,222			2,188
Non-cash stock compensation expense		1,249			1,877
Changes in operating assets and liabilities:
Trade accounts receivable		(5,989	)		2,794
Inventories		5,720			(4,163	)
Prepaid expenses and other current assets		140			455
Other long-term assets		1,246			—
Trade accounts payable		(9,639	)		(892	)
Accrued expenses and other liabilities		362			(3,198	)
NET CASH USED IN OPERATING ACTIVITIES		(13,052	)		(10,416	)
INVESTING ACTIVITIES
Purchases of property, plant and equipment		(1,420	)		(981	)
Purchase of intangible assets		—			(50	)
NET CASH USED IN INVESTING ACTIVITIES		(1,420	)		(1,031	)
FINANCING ACTIVITIES
Repayment of long-term debt		(208	)		(194	)
Restricted cash for revolving credit agreement		(2,050	)		—
Proceeds from line of credit		9,658			—
Proceeds from warrants exercised		37			2,492
Proceeds under stock option and stock purchase plans		456			216
NET CASH PROVIDED BY FINANCING ACTIVITIES		7,893			2,514
DECREASE IN CASH AND CASH EQUIVALENTS		(6,579	)		(8,933	)
Cash and cash equivalents at beginning of period		7,948			21,818
CASH AND CASH EQUIVALENTS AT END OF PERIOD	$	1,369		$	12,885
Amount paid for interest	$	366		$	25
Amount paid for income taxes	$	3		$	3

About Akorn, Inc.

Akorn, Inc. manufactures and markets sterile specialty pharmaceuticals. Akorn has manufacturing facilities located in Decatur, Illinois and Somerset, New Jersey and markets and distributes an extensive line of hospital and ophthalmic pharmaceuticals. Additional information is available at the Company’s website at www.akorn.com.

Materials in this press release may contain information that includes or is based upon forward-looking statements within the meaning of the Securities Litigation Reform Act of 1995. Forward-looking statements give our expectations or forecasts of future events. You can identify these statements by the fact that they do not relate strictly to historical or current facts. They use words such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” and other words and terms of similar meaning in connection with a discussion of future operating or financial performance. In particular, these include statements relating to future steps we may take, prospective products, future performance or results of current and anticipated products, sales efforts, expenses, the outcome of contingencies such as legal proceedings, and financial results.

Any or all of our forward-looking statements here or in other publications may turn out to be wrong. They can be affected by inaccurate assumptions or by known or unknown risks and uncertainties. Many such factors will be important in determining our actual future results. Consequently, no forward-looking statement can be guaranteed. Our actual results may vary materially, and there are not guarantees about the performance of our stock.

Any forward-looking statements represent our expectations or forecasts only as of the date they were made and should not be relied upon as representing our expectations or forecasts as of any subsequent date. We undertake no obligation to correct or update any forward-looking statements, whether as a result of new information, future events or otherwise, even if our expectations or forecasts change. You are advised, however, to consult any further disclosures we make on related subjects in our reports filed with the SEC. In particular, you should read the discussion in the section entitled “Cautionary Statement Regarding Forward-Looking Statements” in our most recent Annual Report on Form 10-K, as it may be updated in subsequent reports filed with the SEC. That discussion covers certain risks, uncertainties and possibly inaccurate assumptions that could cause our actual results to differ materially from expected and historical results. Other factors besides those listed there could also adversely affect our results.

EX-99.2

Exhibit 99.2

Good afternoon, ladies and gentlemen, and welcome to Akorn’s conference call. My name is Art Przybyl and presenting our financial position today is Jeff Whitnell, our CFO. We will hold a brief Q & A period at the end of the presentation.

Our second quarter results met our expectations and continue to demonstrate our improving business model.

Total revenue for the second quarter was $21.2 million an increase of approximately 82% over the prior year period. At the same time, gross profit for the quarter was $4.8 million an increase of 67% over the prior year period.

The increase in gross profit is due primarily to TD vaccine sales, which contributed an incremental $1.8 million as compared to the prior year period. Not including vaccines, gross margin for our business improved from 24.8% to 27.1%, as compared to the prior year period.

1

In our ophthalmic business segment revenues increased by 10% over the prior year period. Historically, since 2005 ophthalmic business revenues have consistently generated approximately $20 million annually. Revenue growth in this segment is dependent on new product introductions and their FDA approvals. Currently, we have 13 ophthalmic products under development, of these 7 are on file with the FDA and 6 are under development.

Our most important ophthalmic product is our internally developed NDA for a new ocular topical anesthetic, Akten. When approved, we believe Akten represents a $225 million market opportunity for us, and a significant short-term revenue opportunity. Recently, we received an approvable letter for Akten and expect to launch Akten in the second half of 2008.

In our hospital drugs and injectables business segment revenues decreased by 6% as compared to the prior year period. Historically, since 2005 hospital drugs and injectables business segment revenues excluding DTPA sales to HHS, have grown from approximately $14 million in 2005 to $20 million in 2007. Revenue growth in this segment is also dependent on new product introductions and their FDA approvals. Currently, we have 32

2

hospital drug and injectable products under development, of those, 10 are on file with the FDA and 22 are under development.

In this business segment there are three significant short-term catalysts for revenue growth in the second half of 2008. We are awaiting FDA approvals for an oral generic Vancomycin and an injectable schedule II narcotic. We also continue to model the potential for a forward deployment sale to HHS for DTPA, our nuclear/radiation antidote.

In the second quarter revenues from our Vaccine business segment begin to demonstrate why vaccines are an important strategic business segment for us. We generated $10 million in TD sales in the second quarter and we expect to exceed that revenue number in the third quarter. We announced the receipt of a contract award from CDC and renegotiated our Exclusive Distribution Agreement for TD vaccines on favorable terms. Recently, we received a large purchase order from the largest U.S. vaccine distributor for our unit dose TD vaccine and as of the end of July, we will only be marketing the unit dose TD vaccine. Our hospital market share for unit dose TD vaccine continues to grow, nearly 1,000 hospitals are buying our vaccine representing approximately 20% hospital market share. We will launch our

3

flu vaccine in the third quarter and expect to submit our pre IND meeting request to CBER for our hepatitis B vaccine shortly. This will allow us to determine the bridging clinical trial requirements towards filing for a biologic license application or BLA.

Our Contract Pharmaceutical Manufacturing business segment revenues decreased by 20% over the prior year period due to customer ordering patterns. However, due to four new agreements with two ophthalmic and two injectable pharma companies we continue to forecast improved revenue growth in the second half of 2008. Historically, since 2005, contract pharma business segment revenues have generated on average $8 million in annual revenues. With our new agreements we expect to double revenues in 2009 and continue to increase our revenue base due to our investment in lyophilization manufacturing, which has passed an FDA pre approval inspection.

Lastly, our Akorn-Strides JV launched its first commercialized product, Rifampin for injection in July. Several other JV products are scheduled for launch in the second half of 2008. Revenues for the JV will be realized in the third quarter 2008.

4

In closing, our objective for the third quarter is for our business model to generate positive cash flow.

I will now turn the conference call over to Jeff for an update on our financial position.

5

EX-99.3

Exhibit 99.3

Thank you, Art, and good afternoon ladies and gentlemen.

Total revenue for the second quarter 2008 was $21.2 million, versus $11.6 million in the second quarter 2007. The year-over-year increase in revenues is principally due to improved product sales in our Ophthalmic and Vaccine business segments. Ophthalmic business segment revenues increased by $400K or 10% versus the prior year comparative period, and Vaccine business segment revenues totaled $10 million.

Our other two core business segments, Hospital Drugs and Injectables and Contract Pharmaceutical Manufacturing, contributed revenues of $4.9 million and $2.1 million, respectively. Both of these business segment revenue totals approximate historical run-rates.

Gross profit for the second quarter 2008 was $4.8 million as compared to $2.9 million in the second quarter 2007. The aggregate increase in second quarter 2008 gross profit of approximately $1.9 million versus the comparative prior year period is due to unit dose and multi dose Tetanus Diphtheria Vaccine sales, which contributed approximately $1.8 million.

Gross margin for the second quarter 2008 was 22.7% versus 24.8% in the prior year period, and reflects the impact of lower margin multi dose Td Vaccine sales. Not including Vaccine sales, gross margin for our business improved to 27.1% from 24.8%, as compared to the prior year period.

Selling, general and administrative expenses totaled $5.9 million in the second quarter 2008, an increase of $0.7 million over the comparative prior year period. This increase is primarily due to the expansion of our Sales Team from 30 to 65 representatives, which was completed in the first quarter 2008.

Research and development expenses were $1.2 million in the second quarter 2008 versus $2.2 million in the comparative prior year period, and reflect lower milestone payments for new product development activities.

The net loss for the second quarter 2008 was $2.8 million or $0.03 per fully diluted share, vs. the net loss of $4.6 million in the second quarter 2007 or $0.05 per fully diluted share. The June 30, 2008 fully diluted share count

for the Company is 94.3 million, which assumes stock options and stock warrants are outstanding for the full year rather than on a weighted average basis.

I would now like to draw your attention to the Balance Sheet. As of today, the Company has cash and restricted cash equal to $3.3 million, plus approximately $4.5 million of undrawn upon availability under our Credit Agreement.

To date, we have used our Revolver to fund our investment in Td Vaccines. As of June 30, 2008, our carrying value on the balance sheet for both the unit dose and the multi dose Td Vaccine was approximately $11 million, a reduction of approximately $8 million that was realized during the second quarter. This reduction in Td Inventory enabled us to level-load our working capital and convert inventory into collectible accounts receivable. As expected, vaccine shipments accelerated in the second quarter 2008 for two reasons:

1.	Increased unit dose Td Vaccine sales to U.S. hospitals.
2.	Accelerated sales of multi dose Td Vaccines to Distributors.

We believe that as our presence in the hospital market and the office-based physician market for vaccines continues to increase, we will be cash flow positive in the second half of 2008 and have sufficient working capital to meet our business requirements.

Finally, I would like to briefly review the Statement of Cash Flows. During the second quarter 2008, we invested a total of $1.2 million, primarily for leasehold improvements, and equipment for our new Distribution Facility and Corporate Headquarters located in Gurnee, IL and Lake Forest, IL, respectively. Also during the second quarter, we retired our mortgage agreement for our manufacturing facility located in Decatur, IL.

Thank you for your time and attention. I will now turn the teleconference back to Art.