Good morning. My name is Mitchell [ph] and I will be your conference operator today. At this time, I would like to welcome everyone to the Impax Laboratories First Quarter 2010 Earnings Conference call. All lines have been placed on mute to prevent any background noise. (Operator Instructions). Thank you Mr. Mark Donohue. You may begin your conference.

Thank you. Good morning everyone, welcome to our first quarter 2010 earnings conference call and webcast at www.impaxlabs.com. And on the call today we have with us Dr. Larry Hsu, our President and Chief Executive Officer and our Arthur Koch, our Chief Financial Officer. Following their prepared remarks both will be available to take any questions you may have as time permits. Should you have any questions after the call, please feel free to telephone Mark Donohue. Investor Relations at 215-933-3526. A replay of today’s call will be available starting at 2:00 PM today through May 11. Please refer to our first quarter earnings release for replay details. Our discussion today may include certain forward looking statements and actual results may differ from those presented here. The factors that could cause such a difference are outlined in our SEC filings and on our websites. A quarterly income statement with segment information and a reconciliation with deferred revenue and deferred manufacturing costs has been posted on the Investor Relations homepage of our website. And with that, it’s a pleasure to turn our call over to Dr. Larry Hsu.

Thank you, Mark. Good morning and thanks for joining us. We are off to a great start in 2010, as we reported significant growth in our first quarter financial results. Our ability to capitalize our new and existing product opportunities let us to $264 million increase in first quarter 2010 revenue to $323 million and a $2.02 increase in earning per diluted share to $2.06 per share. This was a breaking quarter our previously record fourth quarter 2009 performance and it has put us on a path for tremendous year for impacts. Our strong first quarter result benefited significantly from our exclusive launch on March 2 of generic Flomax, which contributed more than $176 million in revenue and $168 million in gross profits in the quarter. We were fortunate to be the only company to launch the product during the eight week period, before the approval of several competing products. With growth in the managed the demand for our product during the show window of opportunity to maximized profit and as reported by (inaudible) we achieved a significant market penetration of more than 77% as of April 23. In addition to realizing the benefits of this short term generic Flomax opportunity, we continued to see strong first quarter 2010 sales of our generic Adderall XR product. And to a lesser extent, fenofibrate product. I will have more to say about these products in shortened. As always we forecast much of our effort on high margin opportunities with a limited competition. Our recent performance of further proof that our ongoing strategy to invest in our – I’m sorry in R&D to develop high value, limited competition opportunities has paid dividends and we’ll continue to provide the potential for earning growth in the future. The generic Flomax launch represented significant short time…

Thank you, Larry and good morning. Wow, what an outstanding quarterly performance. We continue to demonstrate our ability to successfully develop our pipeline of high value ANDA HNR generic business. We also continue to demonstrate our ability to successfully compete with aggressive targets in our marketplace and aggressively capture high value opportunities. This is the basis for our enthusiasm for the value of our pipeline and we are confident that the entire investments we have made will put us in a position to continue to generate above average return. Our generic pipeline of 87 products offer full year and long-term opportunity and have the potential to generate and profit in the month and years ahead. We are also confident that our ongoing business development efforts will lead to long-term strategically and financially attractive opportunities to fuel additional growth. For the first quarter of 2010, we reported total revenue of $323 million, an increase of $254 million over last year’s first quarter driven by the strong performance from several of our higher margin global products. Our strong first quarter was led by the March 2nd launch of generic Flomax, which generated 176 million in revenue. The trail leading up to this record breaking success all started with our insightful legal strategy, which resulted in us being one of only two companies authorized to launch approximately eight weeks before the approval of several competing products. Moreover on March 2nd, we were fortunate to learn we were the only company to receive final product approval. Our efforts to prepare for the launch were very rewarded as we were able to quickly capture a large percentage of the market. Our manufacturing, quality, packaging, distribution and sales organization did an outstanding job of filling 100% of the initial orders providing sufficient supply to cover estimated…

(Operator Instructions) And your first question comes from the line of Ken Cacciatore. Cowen & Company. Ken Cacciatore – Cowen & Company: Question on Adderall XR, Art, you went through it a little bit in terms of trying to get us a sense of the normalization. I don’t know if can point to Q2 as things will normalize or maybe I am using the wrong language here, clearly you said – you gave us what the Shire royalty was, understanding what you have given before, has your royalty have run 50%, that’s generally believe to be by the Street around the royalty rates. We are running about $80 million a quarter. Is there any unnatural inventory that’s still in or is that – I will use it, instead of you giving us the revenue rate that expending rate so we can back into, is that what we should be thinking about on a quarterly basis?

That was a very confidential statement there, but I will try to answer and then you are invited for a follow-up if I missed a point. But our sales are intended to track closely with demand for the product. And we are trying to achieve the normal kinds of potential as we know there were supply disruptions in the fourth quarter that created an unbalanced condition that continued into the first quarter and we expect that there will be more routine or normalized in the second quarter and the data will be reliable for purposes of looking forward by the end of June. Ken Cacciatore – Cowen & Company: So Q2 should just naturally be down after the Q1 level?

I wouldn’t say that, Ken. It depends on what pricing and supply hold up. It’s a decline from current levels, I would expect this statement to be more accurate. Ken Cacciatore – Cowen & Company: And then on Flomax, understanding that it’s big upfront, can you give us some sense of the magnitude of the pricing now that the competitors are in there, so that I mean should we clearly quite a bit, should we be pointing that down dramatically and can you give us a sense of just how much the pricing has changed with the new competitors?

I can’t – we don’t go all the way to answer your question, Ken. What can do is give some color, it is down dramatically in orders of magnitude, several orders of magnitude and it’s typical in our experience to us situations where we have a large number of additional competitors as we do here. Ken Cacciatore – Cowen & Company: Right, okay, fair enough. And just a last question, the Concerta patent came in, just trying to understand how the rules now work here, if that’s a final unappealable ruling, does that have any impact on your exclusivity or do you feel you are going to hold your exclusivity kind of indefinitely until this gets resolved with the agency in terms of approval?

The completion of a final non-appealable ruling does start the exclusivity period and that is a fact of the pre-MA regulation. So that situation is affecting the marketplace.

Your next question comes from the line of Michael Tong. Michael Tong – Wells Fargo Securities: Good morning. Again, congratulations on a good quarter. One question on accounts receivables, it looks to me that basically you’ve added the yearend AR into your sales of Flomax and ended up at the end of the March quarter with an AR of about a little over $300 million. I would have expected that AR to come down a little bit off of your Q4 launch of Adderall XR. So given the fact that just a little bit less Adderall XR sales in the quarter, can I expect the AR for Flomax to really just pull through and we wind up with an AR that’s closer to say 175 by the end of Q2?

Well, it’s really a function of expectation for the topline to get to that answer, Michael. You have to make an estimate of the revenue. Our typical average days sales outstanding is running pretty much in line with our past results of around 89, 90 some days. So that really hasn’t changed and then as additional sales come through they’ll be flowing through the accounts receivable. Michael Tong – Wells Fargo Securities: Okay. And then the second question based on what you know about the dynamics of the Adderall XR market you talked about some supply issues coming in into Q1, and you’re hoping to get that resolved. Based on that, what the dynamics of Adderall XR is, are there any other trigger factors that may tip your profitability in future quarters like Q2, Q3 and Q4 or another way to ask the question is whether you expect to be at least profitable in each of the subsequent quarters for the year?

The heart of the answer runs to the existence and continuance of certain expectation, which we think is holding up our approval and others from entering the market. So if we – one has to make his own judgment about that is that it’s (inaudible) for purposes of this question that exists future profitability will be determined by pricing in the marketplace among a relatively small number of competitors just Shire, (inaudible). And then we have to make projections – each analyst would make his projection about what he thinks pricing is going to do. Michael Tong – Wells Fargo Securities: Okay. And then the last question, do you have any communications with the FDA regarding perhaps the possibility of a tentative approval on Opana ER?

We are expecting – we have know of no reason why we wouldn’t receive our tentative approval on the target date of May 23rd.

Your next question comes from the line of David Amsellem. David Amsellem – Piper Jaffray: So quick question on Flomax just a follow-up with all the recent generic entrants and given where pricing has come down, how should we think about your residual prescription share for Flomax?

Thank you David. We’ve said all along our focus is on the high value ANDA and the signs we’re seeing early in the market is the price pressure on this product is substantial as we said earlier and it could drive our interest in the continuing service very well. It’s difficult to say exactly where it’s all going to start off because there is always an initial flurry and then conditions can settle out later in the product lifecycle and will only add to point out everyone entering in. So it’s hard to answer your question but we know already that it’s going to be dramatically lower, which would suggest our participation will drop dramatically as well. David Amsellem – Piper Jaffray: Okay. And then Concerta question, if the FDA were to require a partial area under the curve standard for showing equivalent, how long would it take to turn that analysis around and more broadly do you think that we’re closer to the agency using partial AUC as a standard or just more closer to the agency figuring out how to evaluate these more complicated small molecules? Thanks.

The answer to that David is really determined by what the regulations for measuring that area under the curve turn out to be, and without knowing that it’s really hard to answer your question. It is a question on many investors’ minds and it’s very frustrating for them not to be able to get a direct question. But until we know how to measure and what to measure, it’s really hard to know how to answer the question. And we saw in the recent advisory committee meeting what we considered to be the beginning of a pass to potentially measuring this but we’re only at the very beginning and our assessment is we are sometime away from any definitive guidance on the question. David Amsellem – Piper Jaffray: Then just one last quick question, if I may. You didn’t mention anything on IPX056, the baclofen product that. But with the significant cash flows I mean any change in your thinking on development of the product or is that – should we still think of that as sort of being on the backburner for now.

Our focus is on 066, that is our top priority. And as we have told investors from the beginning of the year, our planned internal investment in R&D is $36 million, which is all directed at 066. Therefore 056 is taking a backseat at this time.

Your next question comes from the line of David Risinger. David Risinger – Morgan Stanley: Yes, thanks very much. I have a couple of questions and sorry to keep asking about Flomax. But is there any way that you can sort of frame for us how to think about the second quarter specifically how significant the revenue and earnings contribution was in the month of April before competitors entered and how much it may step down in coming months and I know that that’s difficult to answer. And I guess when you comment on that if you can provide any sense for how many months of supply you shipped into the channel and whether there’s going to be any shelf stock adjustments. And then separately just on your fenofibrate franchise, if you could just please comment on your expectations for durability of that financial stream. Thank you.

The first question was on the continuing and the color for Flomax sales in the second quarter. And as we’ve already said both Larry and I in our remarks that the presence of these additional competitors is going to dramatically lower book of price in our share. On the issue of how much did we sell into the channel, our goal in managing our inventories was to reach as many customers as we could to cover their usage during the eight-week period. So there wouldn’t be substantial inventories in the channel when the other competitors arrive and so far our analysis is holding that we accomplished that to a large measure. Having said that, then we should expect April and second quarter sales to be off balance dramatically from the March level. On the final question of fenofibrate, the product itself in units is expanding and that’s a very important element in a product like this. It’s not often where at this age in a product lifecycle we see units expanding. And that’s had us very encouraged in terms of outlook for the market and we continue to remain there. However, competitors are beginning to arrive. We saw the first two in December and therefore the outlook has to be guarded in case of the additional competition. I hope I got them all.

Your next question comes from the line of Elliot Wilbur. Elliot Wilbur – Needham & Co.: Thanks, Elliot Wilbur from Needham and Company. Just maybe going back to some of the earlier question around Concerta, with respect to the final court decision being a triggery event, I think there’s still some additional procedural steps that have to take place before the clock actually starts ticking, I’m just wondering if you can confirm whether or not those have actually occurred so that in fact the clock is running. And then second question on this, given that decision has there been any change or new dialog with the FDA with respect to this product something along the lines of "Hey guys, it’s been six years, we need to get moving on this."

Well, let me help it on these questions, Elliot. I think one of the key factor here obviously is the citizen petitions and I think in addition to the trigger event, which Arthur has alluded to and obviously what the advisory panel talking about the (inaudible) stuff maybe it’s one step closer but at this point they still have no final decision from FDA in terms of what the requirement is. Until then I don’t think the FDA will be able to make a decision on the citizen’s petition. And therefore I guess until the roadblock is removed and we have to see what the final FDA decision will be, then we’ll have a much better picture of our situation. Elliot Wilbur – Needham & Co.: Okay. And then just the question as to whether or not the clock actually has started –

The clock has not started yet. You’re correct, there are certain additional procedural items by the court that have to take place but there are administrators and we think that they will occur in a short period of time. I was speaking more for the balance of the year. Elliot Wilbur – Needham & Co.: Okay. Then second question is, I guess sort of given the large near term cash bonus from Flomax and continued strength in the Adderall market and fibrate obviously the accumulation of cash continues in accelerated pace. Just wondering if the evergreen cash balance has sort of enabled or has led you guys to sort of broaden your thinking with respect to the types of – size and scale specifically of these strategic transactions that you might be evaluating.

Yes, the additional resources have factored into not so much the type but more the size and scale. The type as we talked about it has really been set for like two years now and there’s no change in that. But the size and scale of opportunities that we can consider has expanded with these additional resources and that’s been a very significant development and a very important change in the opportunities as we’re looking at them today. Elliot Wilbur – Needham & Co.: Okay and then last question on Adderall XR, given what seems to be – one player has (inaudible) one quarter, then I guess is the other guy’s turn the next quarter. It’s still reasonable to assume that as we kind of get to a more normalized state, which I think (inaudible) at the end of the second quarter that you are still expecting basically roughly a 50-50 split whatever in the generic market?

Elliot, we don’t give that precise color or outlook for the product. What we’re trying to provide is a flavor for the conditions and we think the conditions as you correctly summarize will settle out by the end of June and make that data more relevant as we look forward. Others have reported that 50-50 split is reasonable to assume and we can say that there’s no structural reason why we couldn’t reach a 50-50 split and we’re competing everyday in the marketplace.

Your next question comes from the line of Corey Davis. Corey Davis – Jefferies & Co.: Thanks very much. A couple questions on – first generic Flomax. It is the math as simple as it looks? I think you said 95% gross margins and if I tax it at your normal corporate rate, I end up with about $1.62 in EPS in this quarter contribution from Flomax, is that approximately right? Just trying to figure out a base earnings scenario here.

That’s a reasonable approach to the quarter. It’s not a lot of magic to us. It’s been a very significant contribution. Corey Davis – Jefferies & Co.: OPANA ER, if you don’t get a tentative approval by May 23rd, do you think that you have an argument to present to the FDA that it was actually their fault with a change in review or that they were overly slow, so that you won’t lose your exclusivity?

At this point, let me try to answer the question. At this point, we are pretty confident that we will look at the tentative approval. Although, obviously, as usual, that we do look at the plan B just in case if we do not get the approval, we have some actions that we have to take. But at this point, we are – we feel optimistic that we believe that we will get approval. Corey Davis – Jefferies & Co.: Okay. And then, sorry, jumping back to Flomax, I think I heard you say this that you won’t expect any significant shelf stock adjustment next quarter. So can we assume that your analysis says that you really or the channel really did sell all $176 million in scripts so that next quarter there is no potential for, say, negative revenue on Flomax?

It takes a lot for the data to confirm that, Corey. But our goal to managing inventories was to achieve as close, because to the – and reach as many customer as possible, so that we could penetrate a very significant. And certainly the early results are that we achieve that and we do not expect any kind of negative revenue in the second quarter, related to those first quarter sales. And we are in a reasonable position in the marketplace. Corey Davis – Jefferies & Co.: Okay. And last question, kind of open ended, but all of us seem to be asking about the same stuff on this call. Is there something that hasn’t been asked that you kind wish had been asked or something that you really want to draw out that you think the Street is missing on the Impax story?

Let me add a couple of things here and maybe then Art can add what are his thoughts. I think what is important is that we want to emphasize our pipeline. I think, obviously, we have a wonderful quarter, and many of the investors were wondering what is after this wonderful quarter, what is left, what’s the remaining of the year, as well as in the next year, what the pictures will look. And I want to just reemphasize that we have a very strong pipeline and we have several products which is at the 31 stage, which is going to expire in the next 12 to 18 months. We are preparing to launch some of those products. So I think obviously we don’t see the Flomax opportunity every quarter or every year necessary. But I think that our base business is going to continue to grow without any question in my mind. Art, you want to add anything?

I think you said it very well, Larry. I would just like to emphasize that the strategic direction we took in 2007 of focusing on first to file is really beginning to pay dividends with those number of first to files we have had in 2009. And the value here although is difficult to predict which individual candidate on which individual day is going to receive what kind of approval or exclusivity, the important thing I think you stressed and I would like to emphasize is that the value of pipeline, although difficult to comprehend by name is clearly a terrific resource for future growth for the company.

I do want to add one more thing is on M&A activities. I just want to reemphasize that M&A is still – is a very high priority activity in the company. Although, I mean, it’s been almost two years now, we haven’t reported anything. But believe us, that we have been working on this very hard. And the important is that we are not just – and we don’t want to just go out and grab something. What important is that we wanted to acquire something which does fit strategically, which you cannot add into our future growth. Corey Davis – Jefferies & Co. At this price would you be prepared to use your currency in equity for M&A?

A combination about any things, we could use in the – equity is definitely a consideration, but debt financing is also a possibility as well as the combined with the cash we have in the bank. Corey Davis – Jefferies & Co.: Great. Thanks guys.

Thanks, Corey. Next question, please.

Your next question comes from the line of Louise Chen. Louise Chen – Collins Stewart: Hi. Obviously you mentioned that you are pretty committed to doing generic or brand M&A in the space. I am just wondering if you can give us a sense of when you would ideally like to get something done or how far along you might be in discussions with potential opportunities.

You know on the M&A, it’s very difficult to set the deadline or set a goal by certain date, we are going to have an M&A done. But again, we will focus on the small sector of a company, either on the generic or brand side, which we are interested in. As pointed out, in the past, 12 to 18 months, we have been very aggressive looking at these opportunities. Some of the opportunity actually will go beyond just the superficial inquiry type of things but not everything panned out as quickly as we like to see. But we are hoping in the next year or two we will have some good things to wait for. Louise Chen – Collins Stewart: Then, I had another question on OPANA ER. Just wondering now given that Teva has settled on all the strengths with Endo, if you were to consider a settlement with Endo on OPANA ER would you expect the timing of that to come before Teva’s entry given that you have the 180-day exclusivity on the major strengths?

Well, we are looking at all kinds of possibility. We are looking at the launch the product ourselves, we are looking to settlement, whatever makes sense to us, we are doing. Louise Chen – Collins Stewart: And then just a last question, which is more quantitatively than quantitatively. As you look into 2011, obviously you had a great year in 2010, and you said that Flomax obviously can’t be repeated every year. But could you maybe highlight some of the growth prospects in 2011, maybe single out some interesting product opportunities that you think that people haven’t really focused on?

Well, I don’t think we can get into those product details. But I think that we have a table which I don’t know have it with me at this point, which lists the 30-month stage timeframe and all these products. I believe we have a seven or eight products, where actually is looking at the 30-month stage filing in the next 12 to 18 months, plus I emphasize that those are only the Paragraph IV. But in the pipeline, we also have some products which is not a Paragraph IV, which we do have a large opportunity in the next 12 to 18 months as well. Louise Chen – Collins Stewart: Thank you.

Thank you. Next question, please.

Your next question comes from the line of Chris Schott. Dewy – JPMorgan: Hi, this is actually Dewy (ph) for Chris. I was just wondering if you guys could comment on the switch on the promotion project that you guys have with Pfizer, switching from I guess Effexor XR over to – I am sorry, Pristiq over to Lyrica?

Well, I mean, our agreement originally was with Wyeth and then Wyeth acquire by the Pfizer. Obviously Pfizer, we look at those strategy and try to pick the benefit from our sales force and that would mutually come to the conclusion that the Lyrica would be a better partner for us to target on the neurologist, and therefore the switch. Dewy – JPMorgan: Alright, thank you.

Thanks. Next question, please.

Your next question comes from the line of Sumant Kulkarni. Sumant Kulkarni – Bank of America Merill Lynch: Thanks for taking my question. Could you give us an update on your Ultram ER case which has been stayed pending some public events and now that pars 180-day exclusivity is almost up?

Art, you want to add some –

The lower court decision by Teva is really weighing heavily on our decision and our outlook there. And we are considering our alternatives right now and it’s really difficult to predict what will ultimately take place. Sumant Kulkarni – Bank of America Merill Lynch: And now that you have got somewhat of an unexpected windfall from generic Flomax in terms of cash this quarter, on the brand site, are you looking at more products to fill the sale representatives’ bags or are you looking at licensing products in?

We look at both opportunities. Obviously, we have – as we indicated, we have some blended product in the pipeline and still at the feasibility stage in addition to the 056, which you know that we put on the back burner for a while, so we can focus on the 066. But in addition to 056 and 066, as we have pointed out in the past, we also several products in the early stage of development. But in-licensing and also in the consideration in terms of looking at the best candidate for the move into the development of the pipeline. Sumant Kulkarni – Bank of America Merill Lynch: And finally, on the generic side, do you have an optimal size of transaction that you are looking at and would you consider somewhat of a transformational acquisition if it comes along.

Wow, optimal size – Art, can you help?

Well, the way we try to get color on that is Sumant is just in the sweet spot for opportunities ranges between companies or businesses or technology will associate to a $150 million in revenues. And we don’t want that to be a boundary at all. It’s just kind of where we keep most of the opportunities that’s strategically for us. There are others on both ends of that scale goes that would also make sense that are just fewer and less in number. Sumant Kulkarni – Bank of America Merill Lynch: Thanks.

Yes.

Okay. Next question, please.

Your next question comes from the line of Lane Yaffi (ph).

Thank you very much. It seems like we are getting one of these perfect storm opportunities in the generic drug sector where there are fewer viable competitors, there is an incredible number of drugs coming off patent, and more and more of those drugs are going to have a period of exclusivity for greater profitability. I was just wondering, one, if you agree with that scenario; two, if you have ever seen an opportunity like this in the sector and how long you think it will last? And coming out of it how much stronger do you think you will be to take advantage of other opportunities like Biologics given the cash you may accumulate over at the next whatever number of years you think the opportunity lasts? Thank you.

I think you described it very well. There are a lot of opportunities coming, especially in the area where we focus on like controlled release, modified release which has turned out to be a lot of a flying (ph) extensions. This is an area worthy of big pharma focus and so that’s now is providing a lot of opportunity for us. Now, As far as the biosimilar, I know that it probably is the issue of a lot of companies are talking about, but those require a lot of investment. So at this point, we are not really looking at the biosimilar as one of the option.

Thank you.

Okay. Next question, please.

Your next question comes from the line of Tim Chiang. Tim Chiang – FTN Midwest Securities: Hi. Larry, I just had a question in terms M&A. I know you guys have done extremely well on the oral solid dose out of the business, especially in controlled release. How much time have you guys spent looking at other segments in the generic space, whether it’s on the injectible side, whether it’s in other non-oral delivery technologies? Is that something that you guys are exploring?

Yes. We are actually the alternative doses form, which I call it, is now oral solid doses in our case is definitely one of the area which we have done lot of interest in. And as I had mentioned in the past, in the oral solid doses form area, we have kind of a focus on the difficult formulate, difficult to compete in type of a area. And we believe that in the other doses where there will be similar type of formula where it will be difficult to formulate or present as a barrier of entry. So we are definitely going into those areas. Tim Chiang – FTN Midwest Securities: Okay, great. Thanks Larry.

Alright, we have time for one more question, please.

And we do have a follow-up question from the line of Michael Tong. Michael Tong – Wells Fargo Securities: Hi. My follow-up question has actually been answered. Thank you.

Well, thanks everybody for joining us. Please listen to our webcast. Tomorrow, we will be presenting at the Deutsche Bank Conference in Boston, and then the following week, we will be presenting at the Bank of America Merrill Lynch Conference. So we look forward to speaking to you again.

Thank you, all. Good-bye.

This concludes today’s conference call. You may now disconnect.