Restructuring Costs

12 Months Ended

Dec. 31, 2011

Note 20 – Restructuring Costs:

In 2008, we announced our plans to resize Par Pharmaceutical, our generic products division, as part of an ongoing strategic assessment of our businesses. These actions resulted in a workforce reduction of approximately 190 positions in manufacturing, research and development, and general and administrative functions. In connection with these actions, we incurred expenses for severance and other employee-related costs. In addition, we made the determination to abandon or sell certain assets that resulted in asset impairments, and accelerated depreciation expense. During the year ended 2009, we incurred additional restructuring costs as we continued to execute this plan, principally driven by charges for one-time termination benefit costs recognized. These charges were somewhat tempered by a modest revision in estimate of certain termination benefit costs.

In June 2011, we announced our plans to resize Strativa Pharmaceuticals, our branded products division, as part of a strategic assessment. We reduced our Strativa workforce by approximately 90 people. The remaining Strativa sales force focus their marketing efforts on Megace^®ES and Nascobal^®Nasal Spray. In connection with these actions, we incurred expenses for severance and other employee-related costs. The intangible assets related to products no longer a priority for our remaining Strativa sales force were fully impaired by these actions. We also had non-cash inventory write downs for product and samples associated with the products no longer a priority for our remaining Strativa sales force. Inventory write downs were classified as cost of goods sold on the consolidated statements of operations for the year ended December 31, 2011. In July 2011, Strativa returned the U.S. commercialization rights of Zuplenz^®to MonoSol, as part of the resizing of Strativa. In September 2011, Strativa executed a termination agreement with BioAlliance returning all Oravig^® rights and obligations to BioAlliance.

The following table summarizes the activity for 2011 and the remaining related restructuring liabilities balance (included in accrued expenses and other current liabilities on the consolidated balance sheet) as of December 31, 2011 ($ amounts in thousands):


Restructuring Activities	Initial Charge		Cash Payments			Non-Cash Charge Related to Inventory and/or Intangible Assets			Reversals, Reclass or Transfers		Liabilities at December 31, 2011
Intangible asset impairments	$	24,226	$	-		$	(24,226	)	$	-	$	-
Severance and employee benefits to be paid in cash		1,556		(1,556	)		-			-		-
Sample inventory write-down and other		1,204		-			(1,204	)		-		-
Total restructuring costs line item	$	26,986	$	(1,556	)	$	(25,430	)	$	-	$	-
Commercial inventory write-down classified as cost of goods sold		674		-			(674	)		-		-
Total	$	27,660	$	(1,556	)	$	(26,104	)	$	-	$	-

The total charge was related to the Strativa segment. The charges related to this plan to reduce the size of the Strativa business are reflected on the consolidated statements of operations for the year ended December 31, 2011.

- Definition

The entire disclosure for restructuring and related activities. Description of restructuring activities such as exit and disposal activities, include facts and circumstances leading to the plan, the expected plan completion date, the major types of costs associated with the plan activities, total expected costs, the accrual balance at the end of the period, and the periods over which the remaining accrual will be settled.

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