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): August 23, 2001
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PROFESSIONAL DETAILING, INC.
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(Exact name of Registrant as specified in its charter)
DELAWARE 0-24249 22-2919486
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(State or other jurisdiction of (Commission File (IRS Employer
incorporation) Number) Identification No.)
10 Mountainview Road,
Upper Saddle River, NJ 07458
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(Address of principal executive (Zip Code)
office)
(201) 258-8450
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Registrant's telephone number, including area code:
N/A
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(Former name or former address, if changed since last report)
Item 5. Other Events
On August 23, 2001 the Registrant issued the following press release:
"PDI REPORTS ON CEFTIN PATENT DEVELOPMENT AND ANNOUNCES
NON-BINDING LETTER OF INTENT ON NEW PROGRAM
Provides guidance on potential generic Ceftin tablet introduction
Upper Saddle River, New Jersey (Thursday, August 23, 2001). PDI (Nasdaq:PDII)
today commented further on the recent developments involving Ceftin patent
matters. As previously announced, on August 21, 2001, the United States Court of
Appeals for the Federal Circuit in the action captioned Glaxo Group Limited and
Glaxo Wellcome, Inc., Plaintiffs-Appellees vs. Ranbaxy Pharmaceuticals, Inc.,
Defendant-Appellant (case # 01-1151) vacated the preliminary injunction granted
by the New Jersey District Court on December 21, 2000 which enjoined Ranbaxy
from offering for sale or selling in the United States any cefuroxime axetil
product.
Potential Generic Introduction
As a result of the Court of Appeals decision, Ranbaxy could commence marketing a
Ceftin tablet generic equivalent immediately following receipt from the FDA of
approval of its Abbreviated New Drug Application (ANDA) which Ranbaxy first
filed in December 1999 and resubmitted in the third quarter of 2000. The timing
of this approval is uncertain and the FDA, upon approval, if any, is not
obligated to provide any prior notice to GlaxoSmithKline (GSK). PDI has had
preliminary discussions with GSK in which it has been advised that GSK is
exploring with its legal counsel all appropriate measures to aggressively defend
its intellectual property rights.
PDI Business Options
Given the uncertainties surrounding the entry of a generic Ceftin tablet
equivalent and the uncertainty of the impact that a generic introduction will
have on the Ceftin selling effort, PDI is committed to taking a prudent and
conservative approach in evaluating its current options. These options include:
o terminating its Ceftin marketing agreement with GSK;
o assessing suspension and tablet strategies individually;
o evaluating Ceftin pricing scenarios;
o assessing demand creation opportunity for the brand;
o assessing cost reduction measures; and
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o evaluating the impact of the purchase minimum reset provisions
provided for in the GSK agreement.
Charles T. Saldarini, Chief Executive Officer of PDI commented, "The strategic
value of the marketing platform we have created around Ceftin is critically
important to our business strategy. We are prepared to accept a lower profit
contribution from our Ceftin franchise, however, we must be certain that
assumptions underlying our estimates remain valid in a generic environment."
Financial Implications
Revised estimates are set forth below for the third and fourth quarters of 2001
and for 2002 in its entirety giving effect to generic competition. In the third
and fourth quarters of 2001, PDI expects a severe impact on net revenue and
profitability. Such impact will result partly from wholesalers and other trade
customers reducing projected purchases from PDI in anticipation of building
generic cefuroxime axetil tablets inventories from other suppliers, and partly
because sales and marketing costs cannot be significantly reduced over the
short-term.
Assuming the immediate introduction of a generic tablet equivalent, PDI
estimates the following adverse impact on net revenue and earnings per share and
believes its net revenue and earnings per share estimates should be lowered as
follows:
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Net Revenue Reduction EPS Reduction
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2001 - 3rd Quarter $25 - 30 million $0.55 - 0.60
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2001 - 4th Quarter $25 - 30 million $0.25 - 0.30
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2001 - Full Year $50 - 60 million $0.80 - 0.90
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2002 $225 - 235 million $1.50
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Non-Binding Letter of Intent
PDI also announced today that it has entered into a non-binding letter of intent
for a large-scale primary care sales team. It is PDI's belief that this program
could be staffed from sales resources PDI currently deploys. There can be no
assurance, however, that a definitive agreement will be successfully negotiated
or executed.
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Conference Call
PDI will be conducting a live conference call & Webcast on Friday, August 24,
2001 at 9:00 AM EST, addressing the implications of the recent news regarding
the preliminary injunction against Ranbaxy being overturned.
The live Webcast will be accessible through the Investor Relations section of
PDI's website, www.pdi-inc.com. The Webcast will be archived on the website for
future on-demand replay. For those without Internet connectivity, the dial-in
number will be 800-235-0452 (domestic) or 785-832-1077 (international).
Company Background & Services
PDI is a leading provider of sales and marketing services to the United States
pharmaceutical industry. We have achieved our leadership position based on more
than 15 years of designing and executing customized sales and marketing programs
for many of the pharmaceutical industry's largest companies and have long
standing relationships with our major clients.
The Company provides several principal services:
Dedicated Contract Sales Services, in which programs are customized to client
specifications;
Syndicated Contract Sales Services, provided through the Company's ProtoCall
unit, enabling clients to tap into an existing, large-scale sales team for
specific detail positions and periods;
LifeCycle X-Tension Services, provides sales, marketing and distribution
services for companies facing portfolio optimization challenges;
PDI Product Commercialization, provides commercial launch services for emerging
and biotechnology companies to independently launch new brands;
PDI Co-promotion, provides co-promotion opportunities through PDI's existing
sales teams;
Medical Education and Communication Services, provided through the Company's TVG
unit, in which clients can access continuing medical education, Sales Force
Tactical Briefings(TM) and peer to peer promotion; and
Marketing Research and Consulting Services, provided through the Company's TVG
unit, enabling clients to study qualitative and quantitative aspects of brand
performance on a pre-launch, launch and continuing basis.
In accordance with the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995, the Company notes that
statements in this release which look forward in time involve risks
and uncertainties that may cause actual results or achievements to
materially differ from those indicated by the forward-looking
statements. These forward-looking statements include any statements
relating to projected operating results, the introduction of any
Ceftin generic equivalents into the market place, the outcome of
court proceedings impacting Ceftin patent protection, as well as any
other statements which are not solely historical. The Company's
plans and objectives are based on assumptions involving judgments
with respect to future economic, competitive and market conditions
and future business decisions, all of which are difficult or
impossible to predict accurately and many of which are beyond the
control of the Company. Therefore, there can be no assurance that
the forward-looking statements will prove to be accurate. The
Company's documents filed with the SEC identify important factors
that may cause the actual results to differ materially from those
indicated by the forward-looking statements.
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SIGNATURE
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.
PROFESSIONAL DETAILING, INC.
By: /s/ Charles T. Saldarini
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Charles T. Saldarini
Chief Executive Officer
Date: August 23, 2001
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