SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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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): March 7, 2002
PHARMACEUTICAL RESOURCES, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
NEW JERSEY FILE NUMBER 1-10827 22-3122182
(STATE OR OTHER JURISDICTION OF (COMMISSION FILE NUMBER) (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
ONE RAM RIDGE ROAD, SPRING VALLEY, NEW YORK 10977
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
Registrant's telephone number, including area code: (845) 425-7100
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
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On March 7, 2002, we settled two significant legal proceedings
involving our wholly-owned operating subsidiary, Par Pharmaceutical, or Par, and
Bristol-Myers Squibb Company, or BMS. Pursuant to a settlement arrangement
between the parties, Par acquired certain assets, principally consisting of the
hypertension medications Capoten(R) and Capozide(R), the cholesterol-lowering
medications Questran(R) and Questran Light Brands(R), and the antibiotic
Sumycin(R), of BMS (we refer to such acquired branded medications collectively
as the Brands).
BMS had filed suit against Par in the United States District Court
for the Southern District of New York alleging infringement of U.S. Patent No.
5,338,732, or the 365 Patent, from the sale of our generic buspirone products.
Par commenced a second related proceeding against BMS in the United States
District Court for the District of Columbia, which was subsequently transferred
to the Southern District of New York, in which Par had alleged, among other
things, that BMS had committed illegal anti-competitive actions to prevent the
use and sale of our anxiety drug, buspirone, and our anorexia medication,
megestrol oral suspension.
To settle these legal proceedings, BMS agreed to enter into two
asset purchase agreements with Par (we refer to such asset purchase agreements
together as the Agreements). Under the Agreements, BMS agreed to sell the Brands
to Par at the below market price of approximately $3 million plus the assumption
by Par of certain liabilities, identified in the Agreements, related to the
Brands. The transactions contemplated by the Agreements and the Settlement
Agreements were consummated upon the filing by BMS and Par of two Stipulations
of Dismissal of Actions with Prejudice with District Court of the Southern
District of New York on March 7, 2002, in which the parties agreed to dismiss
with prejudice their respective claims.
Under the terms of the Agreements, Par acquired:
(i) the trademarks and other intellectual property exclusively
related to the Brands;
(ii) the New Drug Applications for Capoten(R), and the Abbreviated
New Drug Applications for Sumycin(R) in the form of syrup and tablets, and
certain other related regulatory files; and
(iii) other tangible and intangible assets exclusively relating to
the Brands and limited licensing rights in respect of the 365 Patent.
In determining the purchase price for the Brands, we principally
considered the projected cash flows of the Brands, the value of the intellectual
property related to the Brands and the economic value of our claims against BMS
in comparison to resolving such claims and concurrently being able to acquire
the Brands for $3 million cash payment. The purchase price for the Brands was
provided through the use of our available cash.
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We intend to integrate the Brands into our current sales and
marketing operations and have entered into agreements with BMS to supply certain
raw materials required in respect of the Brands. We have no intention of selling
any of the Brands or any portion thereof. The acquisition will be accounted for
using the purchase method.
The above description is a summary of principal terms of the
Agreements. We have attached complete copies of the Agreements to this Form 8-K
as exhibits. Our description of the terms and conditions of the Agreements is
qualified in its entirety by reference to such exhibits.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
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(a) Audited Financial Statements of the acquired Brands shall be provided
within sixty (60) days of the date of their acquisition.
(b) Pro Forma Financial Information shall be provided within sixty (60) days
of the date of acquisition.
(c) Exhibits:
10.1 Asset Purchase Agreement between Bristol-Myers Squibb Company and
Par Pharmaceutical, Inc. in respect of the sale of the
Capoten(REGISTERED), Capozide(REGISTERED), Questran(REGISTERED)and
Questran Light(REGISTERED)Brands
10.2 Asset Purchase Agreement between Bristol-Myers Squibb Company and
Par Pharmaceutical, Inc. in respect of the sale of the
Sumycin(REGISTERED)Brand
99.1 Press Release announcing the acquisition of the five medications
from Bristol-Myers Squibb and the dismissal of the claims
regarding megestrol oral suspension and buspirone.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Company has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
March 22, 2002
PHARMACEUTICAL RESOURCES, INC.
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(Registrant)
/s/ DENNIS J. O'CONNOR
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Dennis J. O'Connor
Vice President, Chief Financial Officer
and Secretary
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