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BRISTOL, Tenn. — King Pharmaceuticals, Inc. (NYSE:KG) announced today that total revenues increased 7% to $516 million during the first quarter ended March 31, 2007, compared to $484 million in the first quarter of 2006. Reported net income equaled $116 million and diluted income per share equaled $0.48 during the first quarter of 2007, compared to net earnings of $51 million and diluted earnings per share of $0.21 in the fourth quarter of the prior year. Excluding special items, net earnings equaled $118 million and diluted earnings per share equaled $0.48 during the first quarter ended March 31, 2007, compared to net earnings of $106 million and diluted earnings per share of $0.44 in the first quarter of 2006.

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Brian A. Markison, President and Chief Executive Officer of King, stated, “We are very pleased with our many accomplishments during the first quarter of 2007, including record high quarterly revenues and earnings and the expansion of our portfolio of marketed products with the acquisition of AVINZA([R]) (morphine sulfate extended release), a true once-a-day oral formulation of morphine.”
Mr. Markison continued, “Importantly, we made significant progress with our development pipeline in the first quarter of 2007 as evidenced by the FDA approval of our ALTACE([R]) (ramipril) tablet formulation. We are also pleased with the positive results from our Phase III clinical trial evaluating the efficacy and safety of our ALTACE([R]) diuretic combination product.” Mr. Markison concluded, “These accomplishments are indicative of the continued execution of our strategy for long-term growth.”
As of March 31, 2007, the Company’s cash and cash equivalents and investments in debt securities totaled approximately $818 million. During the first quarter of 2007, the Company generated cash flow from operations of approximately $108 million.
Joseph Squicciarino, King’s Chief Financial Officer, stated, “We expect to continue utilizing our strong cash position and cash flow to maximize our current product portfolio, advance projects in our research and development pipeline, and fuel our business development initiatives to invest in late stage development opportunities and strategically acquire marketed products.” Mr. Squicciarino continued, “Our robust cash flow from operations has enabled us to increase our R&D investment in a disciplined manner and we continue to expect our R&D investment in 2007 to exceed the 2006 level.”
Net revenue from branded pharmaceuticals totaled $449 million for the first quarter of 2007, an 8% increase from $418 million during the first quarter of 2006.
ALTACE([R]) net sales totaled $157 million during the first quarter of 2007, compared to $159 million during the first quarter of 2006.
Net sales of SKELAXIN([R]) (metaxalone) totaled $112 million during the first quarter of 2007, an increase of 14% compared to $99 million during the same period of the prior year.
THROMBIN-JMI([R]) (thrombin, topical, bovine, USP) net sales totaled $64 million during the first quarter of 2007, a 10% increase from $58 million during the first quarter of 2006.
Net sales of AVINZA([R]) totaled $9 million during the first quarter of 2007. The Company began recognizing revenue for AVINZA([R]) following the completion of its acquisition of the product on February 26, 2007.
Net sales of SONATA([R]) (zaleplon) totaled $24 million during the first quarter of 2007, an increase of 12% compared to $21 million during the first quarter of the prior year.
LEVOXYL([R]) (levothyroxine sodium tablets, USP) net sales decreased to $22 million during the first quarter ended March 31, 2007 from $31 million during the first quarter of 2006.
King’s Meridian Medical Technologies business contributed revenue totaling $43 million during the first quarter of 2007, compared to $41 million during the same period of the prior year.
Royalty revenues, derived primarily from ADENOSCAN([R]) (adenosine), totaled $20 million during the first quarter ended March 31, 2007. For the first quarter ended March 31, 2007, net revenue from contract manufacturing equaled $3 million.
Webcast Information
King will conduct a webcast today which may include discussion of the Company’s marketed products, pipeline, strategy for growth, financial results and expectations, and other matters relating to its business. Interested persons may listen to the webcast on Thursday, May 10, 2007, at 11:00 a.m., E.D.T. by clicking the following link to register and then joining the live event with the same URL:
http://www.kingpharm.com/web_casts.asp
If you are unable to participate during the live event, the webcast will be archived on King’s web site at the same link for not less than 14 days after the webcast.
About AVINZA([R])
AVINZA([R]) is an extended-release opioid agent for patients requiring continuous, around-the-clock analgesia for an extended period of time. AVINZA([R]) is appropriate for chronic, moderate-to-severe pain associated with malignant and non-malignant pain conditions. AVINZA([R]) is an extended release form of morphine allowing for once-daily dosing.