Impax (IPXL) Unit Licenses Zomig Rights in U.S. from AstraZeneca (AZN); Updates FY12 Outlook

Impax Pharmaceuticals, the branded products business unit of Impax Laboratories, Inc. (NASDAQ: IPXL), announced today that it has licensed from AstraZeneca (NYSE: AZN) the exclusive United States (U.S.) commercial rights to Zomig® (zolmitriptan) tablet, orally disintegrating tablet, and nasal spray formulations. As part of a Distribution, License, Development and Supply Agreement, Impax will also have non-exclusive rights to develop new products containing zolmitriptan and to exclusively commercialize these products in the U.S. in connection with the Zomig brand. Under terms of the Agreement, Impax will pay AstraZeneca quarterly payments totaling $130 million during 2012, and thereafter, Impax will pay AstraZeneca tiered royalties on future sales of zolmitriptan products. Impax will receive the benefit of the gross profit on U.S. Zomig® sales commencing from January 1, 2012.

The transaction is expected to be immediately accretive on a non-Generally Accepted Accounting Principles (GAAP) basis to Impax’s earnings per share (EPS) in 2012 and potentially accretive on a GAAP basis depending upon GAAP purchase price treatment, which will be determined in due course.

On January 9, 2012, Impax provided its 2012 financial outlook. The Company has updated its 2012 financial outlook as noted below to reflect the impact of the Distribution, License, Development and Supply Agreement with AstraZeneca for Zomig.

• (Updated) - Gross margins as a percent of total revenues of approximately 60%.
  
• Total research and development (R&D) expenses across the generic and brand divisions to approximate $89 million with generic R&D of approximately $48 million and brand R&D of approximately $41 million.
  
• Patent litigation expenses of approximately $10 million.
  
• (Updated) - Selling, general and administrative (SG&A) expenses of approximately $113 million. The Company expects to add approximately 20 sales representatives to its existing contract sales force of 64 reps to assist in the detailing of Zomig® and expects to incur promotional costs to detail the product. In anticipation of approval and launch of IPX066, the Company will be adding marketing, managed markets and trade, medical affairs and compliance personnel, in addition to spending on various marketing research. Included in the $113 million estimate is approximately $6 million of expenses for the existing contract sales force (approximately one-half of the annual cost) which will continue to be reported as cost of goods sold through June 30, 2012 as part of the Company’s co-promotion of Lyrica®. Beginning July 1, 2012, upon expiration of the Company’s detailing agreement of Lyrica®, the existing sales force costs will be accounted for within SG&A.
  
• Effective tax rate of approximately 36%.
  
• Capital expenditures of approximately $78 million.

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