8-K

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

Date of Report: July 30, 2007
(Date of Earliest Event Reported)

Akorn, Inc.

(Exact Name of Registrant as Specified in its Charter)

Louisiana
(State or other
Jurisdiction of
Incorporation) 0-13976
(Commission
File Number) 72-0717400
(I.R.S. Employer
Identification No.)

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

(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 communications 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 communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications 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 30, 2007, Akorn, Inc. (“Akorn”) issued a press release announcing certain results of Akorn’s financial review for the quarter ended June 30, 2007. A copy of the press release is attached hereto as Exhibit 99.1.

     The information in this report, including the exhibit 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.

Item 9.01     FINANCIAL STATEMENTS AND EXHIBITS.

          (d)     Exhibits.

          99.1     Press release dated July 30, 2007.

SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Current Report on Form 8-K 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: August 3, 2007

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 2007 Financial Results

Buffalo Grove, IL, July 30, 2007 — Akorn, Inc. (NASDAQ: AKRX) a specialty pharmaceutical company, today reported financial results for the second quarter ended June 30, 2007.

Total revenue for the second quarter 2007 was $11.6 million as compared to $12.5 million in the second quarter 2006. Gross profit for the second quarter 2007 was $2.9 million as compared to $5.0 million in the second quarter 2006. The decline in second quarter 2007 revenue and gross profit versus the comparative prior year period is primarily due to customer backorders for IC-Green, which totaled $2.5 million as of June 30, 2007.

The net loss available to common stockholders for the second quarter 2007 was $4.6 million or $0.05 per fully diluted share vs. a net loss available to common stockholders of $2.2 million in the second quarter 2006 or $0.03 per fully diluted share. As of June 30, 2007, the Company had cash and cash equivalents equal to $12.9 million.

Highlights for the Second Quarter 2007:

• New Product Development:

• April 5, 2007: Akorn announced the appointment of Shawn L. Silvestri, Ph.D. as Vice President, New Product Development. Dr. Silvestri is responsible for transitioning our product development efforts from our manufacturing site locations to a centralized Center for Excellence near our corporate headquarters. The Company’s objective is to file at least 12 internally developed ANDA’s per year.

• Biologics and Vaccines Business Segment:

• May 22, 2007: Akorn announced the appointment of Douglas R. Pinnell as Vice President, Vaccine Sales. Mr. Pinnell is responsible for the September 2007 product launch of our Tetanus Diphtheria Vaccine.

• Hospital Drugs and Injectables Business Segment:

• June 8, 2007: Akorn announced the expansion of its business partnership with Natco Pharma Limited by adding two injectable ANDA anti-cancer drug products to their API Supply and Margin Sharing Agreement.

• June 21, 2007: Akorn announced the signing of an exclusive drug development and supply agreement with Cipla, Ltd. for an oral ANDA drug product for the prevention of organ transplant rejection.

• July 17, 2007: Akorn announced the signing of an exclusive development and supply agreement with Haemonetics Corporation for three premix drug products. Premix medications are ready to use intravenous drug products which eliminate drug compounding steps in the pharmacy or point of care.

• July 17, 2007: Akorn-Strides, LLC announced its first ANDA approval for Ketorolac Tromethamine Injection USP, 15 mg/mL and 30 mg/mL.

• July 19, 2007: Akorn announced the signing of an exclusive drug development and supply agreement with Cipla, Ltd. for an injectable ANDA drug product for the prevention of organ transplant rejection.

• Ophthalmic Business Segment:

• June 29, 2007: Akorn announced the filing of NDA 22-221 for Akten^® Ophthalmic Gel 3.5%, a topical anesthetic formulation. Akten^® is a novel, unit dose, preservative free gel formulation intended to be used in any ocular procedure that requires a topical anesthetic agent.

Arthur S. Przybyl, President and Chief Executive Officer stated, “Over the last several quarters, we have built an infrastructure that will allow us to achieve our short term and long term objectives. We have a strong balance sheet and are a debt-free company. We have invested in product development efforts, both internally and externally with our fourteen business development partnerships, and are now poised to capitalize on these strategic investments.

Our opportunity for growth is represented by three near-term product launches:

· Akten^®, our filed opththalmic NDA awaiting a PDUFA date
· Oral Vancomycin, on schedule for an ANDA approval in 2007
· Tetanus Diphtheria Vaccine to be launched September 2007

In the third quarter 2007, our expectation is to increase quarterly revenues by at least 50% as compared to the current quarter. This is based on the re-launch of IC-Green™, which requires us to successfully pass a pre-approval inspection at our Decatur manufacturing facility, the commercial launch of Tetanus Diphtheria Vaccine, and the launch of our Advanced Vision Research contract manufacturing agreement for TheraTears^®.”

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. Such factors include, but are not limited to, risks and uncertainties relating to the resolution of the FDA compliance issues at our Decatur, Illinois manufacturing facility. Other factors besides those listed there could also adversely affect our results.

AKORN, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
IN THOUSANDS

	JUNE 30,			DECEMBER 31,
	2007			2006
	(UNAUDITED)			(AUDITED)
ASSETS CURRENT ASSETS
Cash and cash equivalents	$	12,885		$	21,818
Trade accounts receivable (less allowance for doubtful accounts of $1 and $3, respectively)		1,987			4,781
Inventories		15,897			11,734
Prepaid expenses and other current assets		881			1,321
TOTAL CURRENT ASSETS		31,650			39,654
PROPERTY, PLANT AND EQUIPMENT, NET		32,956			33,486
OTHER LONG-TERM ASSETS
Intangibles, net		8,198			8,825
Other		103			118
TOTAL OTHER LONG-TERM ASSETS		8,301			8,943
TOTAL ASSETS	$	72,907		$	82,083
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES
Current installments of debt	$	408		$	394
Trade accounts payable		3,827			4,719
Accrued compensation		726			1,849
Customer accrued liabilities		253			391
Accrued expenses and other liabilities		963			2,900
TOTAL CURRENT LIABILITIES		6,177			10,253
LONG-TERM LIABILITIES
Long-term debt, less current installments		—			208
Product warranty		1,308			1,308
TOTAL LONG-TERM LIABILITIES		1,308			1,516
TOTAL LIABILITIES		7,485			11,769
SHAREHOLDERS’ EQUITY
Common stock, no par value — 150,000,000 shares authorized; 87,579,283 and 85,990,964 shares issued and outstanding at June 30, 2007 and December 31, 2006, respectively		156,877			150,250
Warrants to acquire common stock		2,820			4,862
Accumulated deficit		(94,275	)		(84,798	)
TOTAL SHAREHOLDERS’ EQUITY		65,422			70,314
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	72,907		$	82,083

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

	THREE MONTHS ENDED						SIX MONTHS ENDED
	JUNE 30,						JUNE 30,}
	2007			2006			2007			2006
Revenues	$	11,638		$	12,475		$	23,373		$	42,205
Cost of sales		8 ,752			7,520			17,998			25,517
GROSS PROFIT		2 ,886			4,955			5,375			16,688
Selling, general and administrative expenses		5 ,189			4,669			10,431			9,153
Amortization and write-down of intangibles		3 39			350			677			701
Research and development expenses		2,161			2,121			4,172			4,166
TOTAL OPERATING EXPENSES		7 ,689			7,140			15,280			14,020
OPERATING (LOSS) / INCOME		(4,803	)		(2,185	)		(9,905	)		2,668
Interest income/(expense) — net		1 69			234			428			(1,085	)
Debt Retirement Expense		—			—			—			(391	)
Other Income/(Expense)		1			(12	)		1			(29	)
(LOSS)/INCOME BEFORE INCOME TAXES		(4,634	)		(1,963	)		(9,476	)		1,163
Income tax provision		1			—			1			—
NET (LOSS)/INCOME		(4,634	)		(1,963	)		(9,477	)		1,163
Preferred stock dividends and adjustments		—			(234	)		—			(560	)
NET (LOSS)/INCOME AVAILABLE TO COMMON STOCKHOLDERS	$	(4,634	)	$	(2,197	)	$	(9,477	)	$	603
NET (LOSS)/INCOME PER SHARE:
BASIC	$	(0.05	)	$	(0.03	)	$	(0.11	)	$	0.01
DILUTED	$	(0.05	)	$	(0.03	)	$	(0.11	)	$	0.01
SHARES USED IN COMPUTING NET (LOSS)/INCOME PER SHARE:
BASIC		86,982			74,853			86,619			68,321
DILUTED		86,982			74,853			86,619			76,481

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

	SIX MONTHS
	ENDED JUNE 30
	2007			2006
OPERATING ACTIVITIES
Net (loss) / income	$	(9,477	)	$	1,163
Adjustments to reconcile net (loss)/income to net cash (used in)/provided by operating activities:
Depreciation and amortization		2,188			1,645
Amortization of debt discounts		—			1,059
Non-cash stock compensation expense		1,877			978
Changes in operating assets and liabilities:
Trade accounts receivable		2,794			(1,765	)
Inventories		(4,163	)		(691	)
Prepaid expenses and other current assets		455			(363	)
Trade accounts payable		(892	)		(314	)
Product warranty		—			1,159
Accrued customer liability		(138	)		197
Accrued expenses and other liabilities		(3,060	)		(1,039	)
NET CASH (USED IN)/PROVIDED BY OPERATING ACTIVITIES		(10,416	)		2,029
INVESTING ACTIVITIES
Purchases of property, plant and equipment		(981	)		(1,388	)
Purchase of intangible assets		(50	)		—
NET CASH USED IN INVESTING ACTIVITIES		(1,031	)		(1,388	)
FINANCING ACTIVITIES (See Note 1 below)
Repayment of long-term debt		(194	)		(2,917	)
Proceeds from common stock and warrant offering		—			18,078
Proceeds from warrants exercised		2,492			888
Proceeds under stock option and stock purchase plans		216			300
NET CASH PROVIDED BY FINANCING ACTIVITIES		2,514			16,349
(DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS		(8,933	)		16,990
Cash and cash equivalents at beginning of period		21,818			791
CASH AND CASH EQUIVALENTS AT END OF PERIOD	$	12,885		$	17,781
Amount paid for interest	$	25		$	561
Amount paid for income taxes	$	3		$	2