Published on December 19, 2009 at 12:59 AM
Akorn, Inc. (NASDAQ: AKRX) today announced that it failed to reach an
amicable resolution to a longer term and strategic business arrangement
with the supplier of its Tetanus Diphtheria (“Td”) vaccine and as a
result will be exiting the business. The existing supply agreement will
end on March 14, 2010. The company previously announced its intent to
exit the distribution of flu vaccines.
Raj Rai, Interim Chief Executive Officer, commented, “In our review and
analysis of the current vaccine business environment and the long-term
strategy of the company, we concluded that the vaccine distribution
business is non-strategic to our core generic pharmaceutical business.
Although it contributed significantly to the top line growth, it has
distracted our sales efforts away from the company’s more profitable
product portfolio. In addition, the Td vaccine business created
excessive financial burden on the company since its launch and is
expected to contribute only marginally to operating profits in 2009.”
Rai further added, “We are well positioned to have a successful 2010
with opportunities to grow with recently launched products and expected
new product approvals next year. Exiting the vaccine distribution
business allows our sales force to focus on new product launches and on
higher margin products. We expect a smooth transition of the Td vaccine
business and will continue to support our existing customer needs
through our supply chain.”
Source Akorn, Inc.