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Proc-Type: 2001,MIC-CLEAR
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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 (Date of earliest event reported): May
8, 2003 MYLAN LABORATORIES INC. (Exact name of registrant as specified in its
charter)
Pennsylvania 1-9114 25-1211621 (State or other jurisdiction (Commission File Number) (I.R.S. Employer Identification No.) of Incorporation)
1500 Corporate Drive Suite 400 Canonsburg, PA 15317 (Address of principal executive offices) (724) 514-1800 (Registrant's telephone number, including area
code) 130 Seventh Street 1030 Century Building Pittsburgh, Pennsylvania 15222 (Former name or former address, if changed since last
report)
Item 9. Regulation FD Disclosure. The following information is furnished pursuant to Item
12 of Form 8-K and is being presented under Item 9 as provided in the
SEC's interim guidance regarding Form 8-K Item 11 and Item 12 filing
requirements (Release No. 34-47583). On May 8, 2003, Mylan Laboratories Inc. issued a press
release announcing its earnings for the fiscal year ended March 31, 2003.
A copy of the press release is attached hereto as Exhibit 99.1. Exhibits: 99.1 (furnished but not filed) Press release dated May 8,
2003, issued by Mylan Laboratories Inc. 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. MYLAN LABORATORIES INC. By: /s/ Edward J. Borkowski Edward J. Borkowski Chief Financial Officer Date: May 8, 2003 EXHIBIT INDEX Exhibit No. Description ------------- -------------- 99.1 (furnished but not filed) Press release dated May 8, 2003, issued by Mylan Laboratories
Inc. NEWS RELEASE FOR IMMEDIATE RELEASE FOR: Mylan Laboratories Inc. FOR FURTHER INFORMATION 1500 Corporate Drive, Suite 400 Contact : Kris King Canonsburg, PA 15317-8574 724-514-1800 Mylan Reports Record EPS, Revenues and Net
Earnings For the Fourth Quarter and Fiscal
2003 Financial Highlights PITTSBURGH, PA - May 8, 2003 - Mylan Laboratories Inc. (NYSE: MYL) announced
today financial results for the fiscal year and fourth quarter ended March 31,
2003, which included record results for both periods. Net revenues for the
fiscal year increased 15% to a record $1.27 billion from $1.10 billion in the
prior year. Net revenues for the fourth quarter increased 25% to a record $353.7
million from $282.6 million for the same prior year period. Net earnings for the fiscal year ended March 31, 2003, increased 5% to $272.4
million from $260.3 million in the prior year. Diluted earnings per share for
fiscal 2003 were $1.45 per share compared to $1.36 in fiscal 2002, an increase
of 7%. Net earnings for the fourth quarter were $73.8 million compared to $67.3
million for the same prior year period, an increase of 10%. Diluted earnings per
share increased 14% to $.40 per share in the current quarter from $.35 per
share. "2003 was a milestone year in terms of revenue and earnings for Mylan,"
commented Robert J. Coury, Vice Chairman and Chief Executive Officer. "Our
generic business continued its strong growth, exceeding one billion in sales for
the first time ever. At the same time, Bertek Pharmaceuticals, our branded
business, successfully launched a significant new product and continued to grow
its existing core products." Net revenues for Mylan's Generic Segment were $1.01 billion in fiscal 2003
compared to $971.1 million in fiscal 2002, an increase of $41.5 million or 4%.
The increase in net revenues was achieved despite the expiration of exclusivity
on buspirone in March 2002, which contributed net revenues of $167.7 million in
fiscal 2002. Excluding sales of buspirone in both periods, net revenues in
fiscal 2003 would have increased 24% over the prior fiscal year. The Brand Segment reported record net revenues of $256.6 million compared to
$133.0 million in fiscal 2002, an increase of $123.6 million or 93%. The
increase in net revenues is attributable to the launch of Amnesteem(R) and the
growth of existing products including Digitek(R), phenytoin and Avita(R). Amnesteem
was launched late in the third quarter of fiscal 2003, and contributed net
revenues of $61.2 million for the fiscal year. The fourth quarter and fiscal 2003 results included the resolution of three
legal matters which in the aggregate did not significantly impact Mylan's
financial position or results of operations. In January 2003, Mylan announced
that it had reached an agreement with Bristol Myers Squibb to resolve all
outstanding disputes between the companies involving buspirone and paclitaxel.
As part of the settlement, Mylan received a one-time payment of $35.0 million.
In March 2003, Mylan reached a tentative settlement of a class action lawsuit
concerning Mylan's 1998 lorazepam and clorazepate anti-trust litigation and
received an arbitration decision in a dispute involving verapamil. The
anti-trust settlement was for $35.0 million, of which Mylan is responsible for
up to $27.9 million, with the remainder to be paid by the other co-defendants.
The $27.9 million, along with $4.2 million plus interest to be paid as a result
of the verapamil arbitration, was included in expense in the current quarter.
The net effect of the resolution of these three legal matters was a gain of $2.4
million during the quarter. "We are pleased to have resolved these outstanding legal matters as we begin
our next fiscal year," stated Mr. Coury. "In addition, subsequent to the end of
fiscal 2003, we reached a tentative agreement to receive an additional $10.0
million from the other co-defendants, further reducing our $27.9 million
liability under the lorazepam and clorazepate litigation." Segment Information Three Months Ended Fiscal Year Ended March 31, March 31, 2003 2002 Change 2003 2002 Change Net Revenues (in millions) Generic Segment $ 248.8 $ 247.1 1% $ 1,012.6 $ 971.1 4% Brand Segment 104.9 35.5 195% 256.6 133.0 93% Total $ 353.7 $ 282.6 25% $ 1,269.2 $ 1,104.1 15% Generic Segment Net revenues for the fiscal year ended March 31, 2003, increased 4% or $41.5
million to $1.01 billion from $971.1 million for the prior fiscal year. The
increase in net revenues in fiscal 2003 was realized despite the loss of
exclusivity on buspirone. During the prior year, the Company had market
exclusivity with respect to buspirone 15mg and 30mg. Following the expiration of
such exclusivity, which occurred in March 2002, buspirone experienced price and
volume erosion which is considered normal in the generic industry. Excluding
revenue from buspirone, net revenues for fiscal 2003 increased $188.9 million or
24%, due to new products launched during the fiscal year, as well as increased
volume and favorable pricing on existing products. New products accounted for
$79.5 million, or approximately 42% of the increase in net revenues excluding
buspirone, with the remaining increase attributable to growth from the Company's
existing product portfolio. Gross profit for fiscal 2003 decreased $21.6 million to $531.1 million from
$552.7 million, primarily attributable to the lower gross profit related to
buspirone. Earnings from operations for fiscal 2003 were $454.0 million compared
to $483.1 million for the prior year, a decrease of 6% or $29.0 million. The
decrease in earnings from operations was driven primarily by the lower gross
profit and an increase in research and development expenses. The increase in
research and development expense was the result of an increase in clinical
studies being performed to expand the development platform. Net revenues for the fourth quarter increased 1% to $248.8 million from
$247.1 million for the same prior year period. Excluding revenue from buspirone,
net revenues for the quarter ended March 31, 2003 increased $43.9 million or
22%. The increase was primarily attributable to new products launched in fiscal
2003, which contributed revenues of $30.3 million. Gross profit for the quarter decreased $7.6 million to $135.0 million from
$142.6 million which was primarily attributable to lower gross profit related to
buspirone. Earnings from operations were $114.3 million for the quarter compared
to $126.6 million for the prior year quarter, a decrease of 10% or $12.3
million. The lower earnings from operations were primarily a result of the lower
gross profit along with an increase in research and development
expenses. Brand Segment For fiscal 2003, the Brand Segment reported net revenues of $256.6 million,
an increase of 93% or $123.6 million from $133.0 million in the prior fiscal
year. The increase in net revenues was the result of the launch of Amnesteem and
growth in the Company's existing portfolio of products including Digitek,
phenytoin and Avita. Gross profit for fiscal 2003 increased $69.1 million or 97%
to $140.3 million from $71.2 million. Earnings from operations were $32.7
million compared to a loss from operations of $16.2 million in the prior
year. Brand Segment operating expenses for fiscal 2003 increased 23% or $20.2
million to $107.6 million from $87.4 million. The increase was attributable to
higher research and development expenses due to ongoing clinical studies related
to nebivolol, and increased selling and marketing expenses related to the launch
of Amnesteem. These increases were partially offset by lower general and
administrative expenses. The Brand Segment realized record net revenues for the current quarter of
$104.9 million, an increase of $69.4 million. The launch of Amnesteem accounted
for approximately 67% of the increase in net revenues, while existing products
continued to grow. As a result of the increase in net revenues, gross profit for
the fourth quarter increased $34.2 million to $52.5 million. Earnings from operations for the fourth quarter were $21.2 million compared
to $0.3 million for the same prior year period. The increase was the result of
higher gross profit, partially offset by increased operating expenses, primarily
research and development. Research and development expenses increased $11.1
million as a result of clinical studies related primarily to nebivolol.
Corporate/Other Segment General and administrative expenses for fiscal 2003 were $75.1 million, an
increase of $3.4 million from the prior year. Other income for fiscal 2003 was
$12.5 million compared to $13.1 million in the prior year. General and
administrative expenses for the fourth quarter of fiscal 2003 increased $11.0
million to $26.3 million, primarily due to increased legal costs associated with
the litigation settlements previously discussed. Other income increased $11.5
million to $5.2 million for the current quarter versus $6.3 million of expense
in the prior year. This increase was due to the performance of investments
accounted for under the equity method, as well as realized gains from the sale
of certain marketable securities. Fiscal 2004 Earnings Guidance Mylan confirmed its previously announced fiscal 2004 earnings guidance of
$1.59 to $1.69 per diluted share. In addition to confirming its fiscal 2004
earnings guidance, the Company also noted that going forward it will provide
only annual earnings guidance and adjust such earnings guidance as necessary.
Annual Meeting of Shareholders The Annual Meeting of Shareholders will be held on Friday, July 25, 2003 at
10:00 am EDT at the Westin Convention Center, Pittsburgh, Pennsylvania.
Conference Call and Live Webcast Mylan will host a conference call and live webcast to discuss its fiscal 2003
earnings today at 10:00 am EDT. The dial-in number to access the live call is
(719) 457-2679. A replay of the conference call will be available until 12:00 pm
EDT, May 15, 2003 at (719) 457-0820, access code 426275. To access the live
webcast, please visit Mylan's website at www. mylan.com and click on the webcast
icon. A replay of the webcast will be available until 12:00 pm EDT, May 15,
2003. Forward Looking Statements The statements made in this press release, in filings made with the SEC, on
our website, or in other contexts (including statements made by our authorized
representatives, either orally or in writing), are or may constitute
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995, which include: Because such statements are subject to risks and uncertainties, actual future
results may differ materially from those expressed or implied by such
forward-looking statements. Factors that could cause actual future results to
differ materially from historic or expected results or that could cause market
prices of our common stock to decline include, but are not limited to: The cautionary statements referred to above should be considered in
connection with any subsequent written or oral forward-looking statements that
may be made by us or by persons acting on our behalf and in conjunction with our
periodic SEC filings. In addition, we refer to the cautionary statements and
risk factors mentioned in Item 7 of our Form 10-K for the year ended March 31,
2002, and our most recently filed Form 10-Q. We undertake no duty to update our
forward-looking statements, even though our situation may change in the future.
Mylan Laboratories Inc. is a leading pharmaceutical company that develops,
manufactures and markets generic and proprietary prescription products. Mylan
has two operating segments that market an extensive line of generic and branded
products through four business units: Mylan Pharmaceuticals Inc., Mylan
Technologies Inc., UDL Laboratories, Inc. and Bertek Pharmaceuticals Inc. For
more information about Mylan, visit www. mylan.com.
MYLAN LABORATORIES INC. AND SUBSIDIARIES Consolidated Statements of Earnings (in thousands, except per share
amounts) Three Months Ended Fiscal Year Ended March 31, 2003 March 31, 2002 March 31, 2003 March 31, 2002 Net revenues $ 353,686 $ 282,598 $ 1,269,192 $ 1,104,050 Cost of sales 166,160 121,667 597,756 480,111 Gross profit 187,526 160,931 671,436 623,939 Operating expenses: Research and development 26,795 12,160 86,748 58,847 Selling and marketing 17,027 15,238 65,625 59,913 General and administrative (1) 34,425 21,878 107,445 110,000 Litigation settlements, net (2,370) - (2,370) - Total operating expenses 75,877 49,276 257,448 228,760 Earnings from operations 111,649 111,655 413,988 395,179 Equity in loss of Somerset (223) (1,229) (4,573) (4,719) Other income (expense), net 5,413 (5,037) 17,098 17,863 Earnings before income taxes 116,839 105,389 426,513 408,323 Provision for income taxes 42,996 38,098 154,160 148,072 Net earnings $ 73,843 $ 67,291 $ 272,353 $ 260,251 Earnings per common share: Basic $ 0.41 $ 0.36 $ 1.47 $ 1.38 Diluted $ 0.40 $ 0.35 $ 1.45 $ 1.36 Weighted average common shares: Basic 182,118 189,159 185,859 188,288 Diluted 185,687 191,805 188,220 191,052 (1)
MYLAN LABORATORIES INC. AND SUBSIDIARIES |
Consolidated Condensed Balance Sheets |
(in thousands) |
March 31, 2003 |
March 31, 2002 | |||
Assets: |
||||
Current assets: |
||||
Cash and cash equivalents |
$ 258,902 |
$ 160,790 | ||
Marketable securities |
427,904 |
456,266 | ||
Accounts receivable, net |
187,587 |
150,054 | ||
Inventories |
237,777 |
195,074 | ||
Other current assets |
116,041 |
104,461 | ||
Total current assets |
1,228,211 |
1,066,645 | ||
Non-current assets |
517,012 |
554,628 | ||
Total assets |
$ 1,745,223 |
$ 1,621,273 | ||
Liabilities: |
||||
Current liabilities |
$ 265,771 |
$ 177,681 | ||
Non-current liabilities |
33,120 |
41,353 | ||
Total liabilities |
298,891 |
219,034 | ||
Total shareholders' equity |
1,446,332 |
1,402,239 | ||
Total liabilities and shareholders' equity |
$ 1,745,223 |
$ 1,621,273 |
MYLAN LABORATORIES INC. AND SUBSIDIARIES |
Segment Results |
(in thousands) |
Three Months Ended |
Fiscal Year Ended |
||||||
March 31, 2003 |
March 31, 2002 |
March 31, 2003 |
March 31, 2002 | ||||
Consolidated: |
|||||||
Net revenues |
$ 353,686 |
$ 282,598 |
$ 1,269,192 |
$ 1,104,050 | |||
Cost of sales |
166,160 |
121,667 |
597,756 |
480,111 | |||
Gross profit |
187,526 |
160,931 |
671,436 |
623,939 | |||
Research and development |
26,795 |
12,160 |
86,748 |
58,847 | |||
Selling and marketing |
17,027 |
15,238 |
65,625 |
59,913 | |||
General and administrative |
34,425 |
21,878 |
107,445 |
110,000 | |||
Litigation settlements, net |
(2,370) |
- |
(2,370) |
- | |||
Earnings from operations |
$ 111,649 |
$ 111,655 |
$ 413,988 |
$ 395,179 | |||
Generic Segment: |
|||||||
Net revenues |
$ 248,803 |
$ 247,101 |
$ 1,012,617 |
$ 971,075 | |||
Cost of sales |
113,776 |
104,479 |
481,511 |
418,339 | |||
Gross profit |
135,027 |
142,622 |
531,106 |
552,736 | |||
Research and development |
12,602 |
9,041 |
44,562 |
33,814 | |||
Selling and marketing |
3,082 |
2,931 |
11,160 |
12,430 | |||
General and administrative |
5,019 |
4,068 |
21,341 |
23,424 | |||
Earnings from operations |
$ 114,324 |
$ 126,582 |
$ 454,043 |
$ 483,068 | |||
Brand Segment: |
|||||||
Net revenues |
$ 104,883 |
$ 35,497 |
$ 256,575 |
$ 132,975 | |||
Cost of sales |
52,384 |
17,188 |
116,245 |
61,772 | |||
Gross profit |
52,499 |
18,309 |
140,330 |
71,203 | |||
Research and development |
14,193 |
3,119 |
42,186 |
25,033 | |||
Selling and marketing |
13,945 |
12,307 |
54,465 |
47,483 | |||
General and administrative |
3,134 |
2,587 |
10,997 |
14,899 | |||
Earnings from operations |
$ 21,227 |
$ 296 |
$ 32,682 |
$ (16,212) | |||
Corporate/Other: |
|||||||
General and administrative |
$ 26,272 |
$ 15,223 |
$ 75,107 |
$ 71,677 | |||
Litigation settlements, net |
(2,370) |
- |
(2,370) |
- | |||
(Loss) earnings from operations |
$ (23,902) |
$ (15,223) |
$ (72,737) |
$ (71,677) |