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UNITED STATES

FORM 10-K

(Mark One)

	[X]	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2003

OR

	[  ]	TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number 0-24425

King Pharmaceuticals, Inc.

Registrant’s telephone number, including area code: (423) 989-8000

Securities registered under Section 12(b) of the Exchange Act:

Securities registered under Section 12(g) of the Exchange Act:

      Indicate by check mark whether the registrant (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes x  No o          

      Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. o

      Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Act). x

      The aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity as of June 30, 2003 was $3,143,503,811. The number of shares of Common Stock, no par value, outstanding at March 9, 2004 was 241,354,416.

Documents Incorporated by Reference: None

PART I

      King Pharmaceuticals, Inc. was incorporated in the State of Tennessee in 1993. Our wholly owned subsidiaries are Monarch Pharmaceuticals, Inc.; Jones Pharma Incorporated; King Pharmaceuticals Research and Development, Inc.; Meridian Medical Technologies, Inc.; Parkedale Pharmaceuticals, Inc.; King Pharmaceuticals of Nevada, Inc.; and Monarch Pharmaceuticals Ireland Limited.

      Our principal executive offices are located at 501 Fifth Street, Bristol, Tennessee 37620. Our telephone number is (423) 989-8000 and our facsimile number is (423) 274-8677. Our website is www.kingpharm.com. We have, since November 15, 2002, made available through our website our annual reports on Form 10-K, our quarterly reports on Form 10-Q, our current reports on Form 8-K and any amendments as soon as reasonably practical. These filings are also available to the public over the Internet at the website of the Securities and Exchange Commission, which we refer to as the “SEC,” at http://www.sec.gov. You may also read and copy any document that we file at the SEC’s Public Reference Room located at 450 Fifth Street, NW, Washington, DC 20549. Please call the SEC at
1-800-SEC-0330 for further information on the Public Reference Room.

      King is a vertically integrated pharmaceutical company that develops, manufactures, markets and sells branded prescription pharmaceutical products. By “vertically integrated,” we mean that we have the capabilities of a major pharmaceutical company, including

	•	sales and marketing,
	•	research and development,
	•	manufacturing,
	•	packaging,
	•	distribution,
	•	quality control and assurance, and
	•	regulatory affairs.

      Through a national sales force consisting of approximately 1,300 approved positions, and through marketing alliances, we market our branded pharmaceutical products to general/family practitioners, internal medicine physicians, cardiologists, endocrinologists, psychiatrists, neurologists, obstetricians/gynecologists, and hospitals across the United States and in Puerto Rico.

      Our business strategy includes the development of new branded prescription pharmaceutical products, including new chemical entities, as well as the acquisition of compounds already in development, that provide us with strategic pipeline product opportunities.

      Our business strategy also includes acquiring currently marketed branded pharmaceutical products and increasing their sales through focused marketing and promotion and product life cycle management. By “product life cycle management,” we mean the extension of the economic life of a product, including seeking and gaining all necessary related governmental approvals, by such means as:

	•	securing U.S. Food and Drug Administration, which we refer to as “FDA,” approved new label indications;
	•	developing and producing different strengths;
	•	producing different package sizes;
	•	developing new dosages; and
	•	developing new product formulations.

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      We acquire branded products primarily from larger pharmaceutical companies. These companies sell products for various reasons including limiting their operating expenses or eliminating duplicate products.

      We also seek attractive company acquisitions which add products or products in development, technologies or sales and marketing capabilities to our key therapeutic areas or that otherwise complement our operations.

      Unlike many of our competitors, we have a broad therapeutic focus that provides us with opportunities to develop or acquire a wide variety of products or late stage compounds. In addition, we have well known products in all of our therapeutic categories that generate high prescription volumes. Our branded pharmaceutical products can be divided primarily into the following therapeutic areas:

	•	cardiovascular (including Altace®, Corzide®, Procanbid® and Thalitone®),
	•	endocrinology/women’s health (including Levoxyl®, Cytomel®, Triostat®, Prefest®, Menest®, Delestrogen® and Nordette®),
	•	neuroscience (including Sonata® and Skelaxin®),
	•	critical care (including Thrombin-JMI®, Brevital® and Synercid®),
	•	anti-infectives (including Bicillin®, Cortisporin®, Neosporin® and Coly-Mycin M®) and
	•	respiratory (including Intal® and Tilade®).

      Additionally, we manufacture pharmaceutical products under contracts with a variety of pharmaceutical and biotechnology companies. We have not accepted or renewed manufacturing contracts for third parties where we perceived insignificant volumes or revenues.

      The following summarizes net revenues by operating segment (in thousands).

(1)	The branded pharmaceuticals segment net revenues for 2002 reflect

	•	a $22,113 charge for corrections of immaterial errors related to underpayments of amounts due under Medicaid and other governmental pricing programs for the years 1998 to 2001,
	•	a $12,399 charge for corrections of immaterial errors related to underpayments of amounts due under Medicaid and other governmental pricing programs related to 2002 and recorded in the fourth quarter of 2002, and
	•	an $11,970 charge arising from changes in accounting estimates related to Medicaid and other governmental pricing programs.

The branded pharmaceuticals segment net revenues for 2003 reflect an $18,000 charge for changes in accounting estimates related to Medicaid for the years 1998 to 2002 and a $900 charge for corrections of immaterial errors related to Medicaid for the years 1994 to 1997. For further information, please see the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and Note 17 to our audited consolidated financial statements.

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Key Historical Milestones

      We acquired from Glaxo Wellcome, Inc., predecessor to SmithKline Beecham Corporation, a subsidiary of GlaxoSmithKline plc, for $54.0 million, including $3.1 million of assumed liabilities, all rights to the Cortisporin® product line in March 1997, the Viroptic® product line in May 1997, and six additional branded products, including Septra®, and exclusive licenses, free of royalty obligations, for the prescription formulations of Neosporin® and Polysporin® in November 1997.

      In February 1998, we acquired from Warner-Lambert Company (predecessor to Pfizer, Inc.), 15 branded pharmaceutical products, our facility located in Rochester, Michigan and some manufacturing contracts with third parties for $127.9 million, including $2.9 million of assumed liabilities.

      In December 1998, we acquired from Hoechst Marion Roussel, Inc. (predecessor to Aventis Pharmaceuticals, Inc.), for $362.5 million, the United States and Puerto Rico rights to Altace® and two other small branded pharmaceutical products. Altace® is an Angiotensin Converting Enzyme inhibitor, which we refer to as an “ACE” inhibitor. We are currently manufacturing a portion of the finished dosage and packaging Altace® in our facility in Bristol, Tennessee. Aventis also remains a supplier of the active ingredient “ramipril,” and a portion of the finished dosage of Altace®. On October 4, 2000, the FDA approved new indications for Altace® requested under a supplemental New Drug Application, which we refer to as an “sNDA.” In addition to the treatment of hypertension, this approval permits the promotion of Altace® to reduce the risk of stroke, myocardial infarction (heart attack) and death from cardiovascular causes in patients 55 and over either with a history of coronary artery disease, stroke or peripheral vascular disease or with diabetes and one other cardiovascular risk factor (hypertension, elevated total cholesterol levels, low HDL levels, cigarette smoking or documented microalbuminuria). Altace® is also indicated in stable patients who have demonstrated clinical signs of congestive heart failure after sustaining acute myocardial infarction. Altace® is marketed by our subsidiary Monarch and by Wyeth pursuant to the Co-Promotion Agreement we entered into in June 2000, described below.

      In August 1999, we acquired the antibiotic Lorabid® in the United States and Puerto Rico from Eli Lilly and Company for $91.7 million, including acquisition costs plus potential sales performance milestones. As of December 31, 2003, we have not made any milestone payments. We have a supply agreement with Eli Lilly under which we remain obligated to purchase minimum levels of inventory of Lorabid® through September 1, 2005. During the fourth quarter of 2002, we decided to divest our rights to Lorabid® and reviewed the related intangible assets for impairment. Based on changes in prescription trends, we believe the minimum purchase commitments under the supply agreement are greater than inventory quantities which we will be able to sell to our customers. For details regarding charges related to the liability associated with the amount of the purchase commitments in excess of expected demand and our review for impairment of the Lorabid® intangible assets, as updated for management’s cash flow expectations for Lorabid®, please see the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and Note 8 to our audited consolidated financial statements.

      On February 25, 2000, we acquired Medco Research, Inc. in an all stock transaction accounted for as a pooling of interests valued at approximately $366.0 million. We exchanged approximately 14.4 million shares of King common stock for all of the outstanding shares of Medco. Each share of Medco was exchanged for 1.3514 shares (post subsequent stock splits) of King common stock. In addition, outstanding Medco stock options were converted at the same exchange ratio to purchase approximately 1.4 million shares (post subsequent stock splits) of King common stock. Medco is now one of our wholly owned subsidiaries and, effective November 1, 2000, was renamed “King Pharmaceuticals Research and Development, Inc.” Through King Research and Development, we are engaged in the research and development of chemical compounds, including new chemical entities, which provide us with strategic pipeline opportunities that may lead to the commercialization of new branded prescription pharmaceutical products. Additionally, we engage in product life cycle management to develop new indications and line extensions for existing and acquired products and to improve the quality and efficiency of our manufacturing processes.

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      On June 23, 2000, we entered into a marketing alliance with Wyeth to market Altace® in the United States and Puerto Rico. We refer to this agreement as the “Co-Promotion Agreement.” Subject to the terms of the Co-Promotion Agreement, we pay Wyeth a quarterly fee based on a percentage of net sales in exchange for its marketing efforts. Wyeth purchased $75.0 million of our common stock and paid us $25.0 million in cash upon execution of the Co-Promotion Agreement. Wyeth paid us an additional $50.0 million in November 2000 as a result of the FDA’s final approval on October 4, 2000 of new indications for Altace®.

      On August 31, 2000, we acquired Jones Pharma Incorporated in an all stock transaction accounted for as a pooling of interests valued at approximately $2.4 billion. We exchanged approximately 98.4 million shares (post subsequent stock splits) of King common stock for all of the outstanding shares of Jones. Each share of Jones was exchanged for 1.5 shares (post subsequent stock splits) of King common stock. In addition, outstanding Jones stock options were converted at the same exchange ratio to purchase approximately 5.4 million shares (post subsequent stock splits) of King common stock. Jones is now one of our wholly owned subsidiaries.

      On January 8, 2001, we entered into a license agreement with Novavax, Inc. to promote, market, distribute and sell Estrasorb™, Androsorb™ and some other women’s health products which may be developed by Novavax. Under the terms of this agreement, as amended by our subsequent agreements with Novavax on June 29, 2001, we have an exclusive license with Novavax to promote, market, distribute and sell, following approval, these products worldwide, except for the United States and Puerto Rico, where, under a separate agreement, we will co-market them with Novavax. During the term of the license, we will pay Novavax a reasonable royalty on net sales of these products in all territories except the United States and Puerto Rico. Novavax will pay us an amount equal to approximately 50% of gross profit derived from the sale of these products in the United States and Puerto Rico. We will share equally with Novavax approved marketing expenses related to the promotion of these products in the United States and Puerto Rico. Estrasorb™ is a topical emulsion estrogen therapy which employs Novavax’s proprietary micellar nanoparticle technology designed to deliver 17-beta estradiol, a naturally occurring hormone, through the skin when applied in a lotion-like form. The New Drug Application, which we refer to as an “NDA,” for Estrasorb® was approved by the FDA on October 9, 2003. Novavax, working together with our company, plans to launch the sales and marketing of Estrasorb^TM in the United States during the first half of 2004. Androsorb™ is a topical testosterone replacement therapy for testosterone deficient women.

      On May 25, 2001, the FDA approved our NDA for Levoxyl®, our levothyroxine sodium drug product for the treatment of hypothyroidism. We filed the NDA as a result of the FDA’s August 14, 1997 announcement in the Federal Register (62 FR 43535) that orally administered levothyroxine sodium drug products are new drugs. The notice stated that manufacturers who wish to continue to market these products must submit applications as required by the Food, Drug and Cosmetic Act, which we refer to as the “FDC Act,” by August 14, 2000. On April 26, 2000, the FDA issued a second Federal Register notice extending the deadline for filing these applications until August 14, 2001.

      On August 8, 2001, we acquired certain rights to three branded pharmaceutical products and a license to a fourth product from Bristol-Myers Squibb Company for $285.0 million plus approximately $1.5 million of expenses. The product rights acquired include Bristol-Myers Squibb’s rights in the United States to Corzide®, Delestrogen® and Florinef®. We also acquired a fully paid license to Corgard® in the United States. Corzide®, a combination beta-blocker and thiazide diuretic, is indicated for the management of hypertension. Corgard®, a beta-blocker, is indicated also for the management of hypertension, as well as long-term management of patients with angina pectoris. Delestrogen® is an injectable estrogen replacement therapy. Florinef® is a partial replacement therapy for primary and secondary adrenocortical insufficiency in Addison’s disease and for the treatment of salt-losing adrenogenital syndrome. For information regarding charges related to Florinef®, please see the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and Note 8 to our audited consolidated financial statements.

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      On December 13, 2001, the FDA approved our NDA for Tigan® 300mg capsules. Tigan® is indicated for the treatment of post-operative nausea and vomiting and for nausea associated with gastroenteritis.

      On May 29, 2002, we acquired all rights to Prefest®, a branded pharmaceutical product, from Ortho-McNeil Pharmaceutical, Inc., a Johnson & Johnson subsidiary, for $108.0 million, plus approximately $3.3 million of expenses. During February 2003, we paid Ortho-McNeil an additional $7.0 million upon receipt of the FDA’s approval to change the name of the product to “Prefest®” from Ortho-Prefest®. Prefest® is a differentiated combination hormone replacement therapy with an intermittent progestin administration, together with a continuous administration of estrogen.

      On December 30, 2002, we licensed or acquired the rights to three branded pharmaceutical products from Aventis for the initial cash payment of $197.5 million, plus $4.3 million of expenses. The products involved include rights in the United States, Puerto Rico, and Canada to Intal® and Tilade®, inhaled anti-inflammatory agents for the management of asthma. We also obtained worldwide rights, excluding Japan, to Synercid®, an injectable antibiotic indicated for treatment of vancomycin-resistant enterococcus faecium and treatment of some complicated skin and skin structure infections. In addition to the initial cash payment, we paid $10.3 million in December 2003 as a milestone payment due to the continued recognition of Synercid® as an effective treatment for vancomycin-resistant enterococcus faecium. As additional consideration for Synercid®, we have agreed to remaining potential milestone payments to Aventis totaling $64.8 million.

      On January 8, 2003, we acquired Meridian Medical Technologies, Inc. for $253.9 million in cash paid to its shareholders in exchange for their shares of Meridian common stock. Meridian pioneered the development, and is the leading manufacturer, of auto-injectors for the self-administration of injectable drugs. An auto-injector is a pre-filled, pen-like device that allows a patient or caregiver to automatically inject a precise drug dosage quickly, easily, safely and reliably. Meridian’s commercial pharmaceutical products primarily include EpiPen®, an auto-injector filled with epinephrine for the emergency treatment of anaphylaxis resulting from severe or allergic reactions to insect stings or bites, foods, drugs and other allergens, as well as idiopathic or exercise-induced anaphylaxis. Meridian manufactures EpiPen® under a supply agreement with Dey L.P., which markets the product. Other pharmaceutical products that are primarily sold to the U.S. Department of Defense, which we refer to as the “DoD,” under an Industrial Base Maintenance Contract include Atropen® and ComboPen®, nerve agent antidotes; the Antidote Treatment Nerve Agent Auto-injector, a nerve gas antidote utilizing Meridian’s patented dual chambered auto-injector and injection process; and auto-injectors filled with diazepam for treatment of seizures and morphine for pain management.

      On April 29, 2003, the U.S. Patent and Trademark Office, which we refer to as the “PTO,” issued the first patent on our FDA-approved Levoxyl®, U.S. Patent No. 6,555,581, a utility patent with composition of matter claims. We have submitted in excess of 40 applications for additional patents to the PTO relating to our novel quick-dissolving formulation of Levoxyl®.

      On June 12, 2003, we acquired the primary care business of Elan Corporation, plc, and that of some of its subsidiaries, in the United States and Puerto Rico, including the rights to Sonata® and Skelaxin® and rights pertaining to potential new formulations of these products, together with Elan’s United States primary care field sales force. Product rights subject to the agreement include those related to Sonata®, a nonbenzodiazepine treatment for insomnia, and Skelaxin®, a muscle relaxant, in the United States, its territories and possessions, and Puerto Rico. Under the terms of the agreement, Elan’s sale of Skelaxin® included related NDAs, copyrights, trademarks, patents and rights pertaining to potential new formulations of Skelaxin®. Elan’s sale of Sonata® included its rights to the product, as well as certain related copyrights. We also acquired certain intellectual property, regulatory, and other assets relating to Sonata® directly from Wyeth. Under the terms of the agreement, we secured an exclusive license to the intellectual property rights in this territory of both Wyeth and Elan to the extent they relate to new formulations of Sonata®, other than for use in animals. The total estimated purchase price of $814.4 million includes the cost of acquisition, assumed liabilities and a portion of contingent liabilities. The purchase price also includes the transfer of inventory with a value of approximately $40.4 million. In addition to the initial

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	•	will pay royalties on the current formulation of Skelaxin® from the date of closing;
	•	will pay up to an additional $60.0 million if Elan achieves certain milestones in connection with the development of a reformulated version of Sonata®;
	•	will pay $15.0 million as a milestone payment if annual net sales of a reformulated version of Sonata® exceed $100.0 million; and
	•	will pay for costs associated with the development of the reformulated version of Sonata®.

      On June 19, 2003, we received FDA approval of our sNDA, covering pediatric and adult formulations of our nerve gas antidote AtroPen®. This is the first time that pediatric formulations of this homeland security product have been approved for use in the United States. AtroPen® utilizes our auto-injector technology.

      On October 30, 2003, we announced the receipt of an approvable letter from the FDA for a new Intal® inhaler formulation utilizing hydrofluoroalkane, which we refer to as “HFA,” an environmentally friendly propellant. The patent related to Intal® HFA extends through September 2017.

      On November 3, 2003, we announced that we have completed enrollment in the ongoing Phase IV clinical trial to determine the safety and effectiveness of Altace® in the treatment of hypertension (high blood pressure) in children. This trial, which we refer to as “TOPHAT” (Treatment of Pediatric Hypertension with Altace Trial), is scheduled to conclude by the end of 2004.

      On December 5, 2003, we commenced the Phase III clinical trial program involving binodenoson, our next generation cardiac pharmacologic stress-imaging agent. The data from the Phase II dose ranging study indicates that binodenoson, at effective doses, is better tolerated than adenosine, the current market leader, which we previously developed.

      During December 2003, we commenced the Phase I clinical trial program for T-62, a new chemical entity that we are developing as a potential treatment for neuropathic pain. The initial Phase I trial for T-62 is a single-center, randomized double-blind, placebo-controlled evaluation of the safety and pharmacokinetics of escalating single oral doses of this new chemical entity in healthy adult subjects.

      On January 13, 2004, we announced the completion of dosing of the initial concentration of MRE0094 in our ongoing Phase I clinical trial program evaluating the safety of the drug in patients. MRE0094, a new chemical entity, is an adenosine A2a receptor agonist that we are developing as a potential topical treatment for chronic diabetic foot ulcers.

      On January 27, 2004, the PTO issued a second utility patent pertaining to our FDA-approved product Skelaxin®. The newly issued patent extends through December 2021.

      During March 2004, we terminated our contract with BearTown Pharma, Inc. to develop tetrac.

      During March 2004, we commenced the Phase II clinical trial program for an extended release formulation of our Sonata® product.

Industry

      The pharmaceuticals industry is a highly competitive global business composed of a variety of participants, including large and small branded pharmaceutical companies, specialty and niche-market pharmaceutical houses, biotechnology firms, large and small research and drug development organizations, and generic drug manufacturers. These participants compete for patient and physician loyalty to their products based on a number of factors, including technological innovation or novelty, clinical efficacy, safety, convenience or ease of administration and cost-effectiveness. In order to promote their products to physicians and consumers, industry participants devote considerable resources to advertising, marketing and

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      The industry is affected by the following:

	•	the aging of the patient population, including diseases specific to the aging process and demographic factors, including obesity, diabetes, cardiovascular disease, and patient and physician demand for products that meet chronic or unmet medical needs;
	•	technological innovation, both in drug discovery and corporate processes;
	•	merger and acquisition activity whereby pharmaceutical companies are acquiring one another or smaller biotechnology companies and divestitures of products deemed “non-strategic”;
	•	cost containment and downward price pressure from managed care organizations and governmental entities, both in the United States and overseas;
	•	increased drug development and manufacturing costs for pharmaceutical producers;
	•	the rise of generic companies and challenges to patent protection and exclusivity;
	•	increased governmental scrutiny of the healthcare sector, including issues of patient safety, cost efficacy and reimbursement/ insurance matters; and
	•	the cost of advertising and marketing, including direct-to-consumer advertising on television and in print.

Branded Pharmaceuticals

      We market a variety of branded prescription products that primarily can be divided into the following therapeutic areas:

	•	cardiovascular (including Altace®, Corzide®, Thalitone® and Procanbid®),
	•	endocrinology/women’s health (including Levoxyl®, Cytomel®, Triostat®, Prefest®, Menest®, Delestrogen® and Nordette®),
	•	neuroscience (including Sonata® and Skelaxin®),
	•	critical care (including Thrombin-JMI®, Synercid® and Brevital®),
	•	anti-infective (including Bicillin®, Cortisporin®, Neosporin® and Coly-MycinM®), and
	•	respiratory (including Intal® and Tilade®).

      Our branded pharmaceutical products are generally in high volume therapeutic categories and are well known for their indications (for example, Altace®, Skelaxin®, Levoxyl® and Sonata®). Additionally, many of our branded products have limited or no generic competition, including patent protected products and products that are difficult to formulate. Branded pharmaceutical products represented 85.5% and 91.5% of total net revenues for each of the years ended December 31, 2003 and 2002.

      Cardiovascular. Altace®, an ACE inhibitor, is our primary product within this category. In August 1999, the results of the Heart Outcomes Prevention Evaluation trial, which we refer to as the “HOPE trial,” were released. The HOPE trial determined that Altace® significantly reduces the rates of stroke, myocardial infarction (heart attack) and death from cardiovascular causes in a broad range of high-risk cardiovascular patients. On October 4, 2000, the FDA approved our sNDA. This approval permits the promotion of Altace® to reduce the risk of stroke, myocardial infarction (heart attack) and death from cardiovascular causes in patients 55 and over either with a history of coronary artery disease, stroke or peripheral vascular disease or with diabetes and one other cardiovascular risk factor (hypertension, elevated

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      Endocrinology/Women’s Health. We have a number of leading branded pharmaceutical products in this category including Levoxyl®, Cytomel®, Triostat®, Prefest®, Menest®, Delestrogen® and Nordette®. Levoxyl®, Cytomel® and Triostat® are indicated for the treatment of thyroid disorders. Prefest® is a combination hormone replacement therapy. Menest® and Delestrogen® are estrogen replacement therapies and Nordette® is a contraceptive. These products are marketed primarily to primary care physicians, endocrinologists and obstetricians/gynecologists.

      Neuroscience. Products in this category include Sonata® and Skelaxin®. Sonata® is a nonbenzodiazepine treatment for insomnia which is promoted primarily to primary care physicians, neurologists, and psychiatrists. Skelaxin® is a muscle relaxant indicated for the relief of discomforts associated with acute, painful musculoskeletal conditions. This product is marketed primarily to primary care physicians, neurologists, orthopedic surgeons and pain specialists.

      Critical Care. Products in this category are marketed primarily to hospitals. Our largest products in this category are Thrombin-JMI®, Synercid® and Brevital®. Thrombin-JMI® aids in controlling minor bleeding during surgery. Synercid® is an injectable antibiotic, primarily administered in hospitals, indicated for treatment of vancomycin-resistant enterococcus faecium and treatment of some complicated skin and skin structure infections. Brevital® is an anesthetic solution for intravenous use in adults and for rectal and intramuscular use in pediatric patients. Brevital® is marketed as a short-term and long-term anesthetic because of its rapid onset of action and quick recovery time. Brevital® is used alone and in combination with other anesthetics. Its rapid onset of action makes it a useful induction agent prior to the administration of other agents to maintain anesthesia.

      Anti-infective. Our anti-infective products are marketed primarily to general/family practitioners and internal medicine physicians and are prescribed to treat uncomplicated infections of the respiratory tract, urinary tract, eyes, ears and skin. These products are generally in technologically mature product segments. Bicillin® is our largest product in the category.

      Respiratory. Our respiratory products are marketed primarily to primary care physicians and respiratory specialists. Our primary products in this area include Intal® and Tilade®. Intal® and Tilade® are oral multi-dose inhalers of non-steroidal anti-inflammatory agents indicated for the preventive management of asthma.

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      Some of our branded prescription products are described below:

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(1)	We acquired licenses for the exclusive rights in the United States under various patents to the active ingredient in Altace®.
(2)	We acquired the trademark and patents for Thalitone® from Boehringer Ingelheim Pharmaceuticals, Inc.
(3)	We acquired a fully paid license to Corgard® in the United States.
(4)	We have exclusive licenses, free of royalty obligations, to manufacture and market prescription formulations of Neosporin® and Polysporin®.

      Net sales of many of our branded prescription products for the year ended December 31, 2003 are set forth in the tables below.

(1)	Includes net sales for Skelaxin® following its acquisition on June 12, 2003.
(2)	Includes net sales for Sonata® following its acquisition on June 12, 2003.
(3)	We sold the animal health product Soloxine® to Virbac on September 8, 2003.

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      Net sales in the table above reflect an $18.0 million charge for changes in accounting estimates related to Medicaid for the years 1998 to 2002 and a $0.9 million charge for corrections of immaterial errors related to Medicaid for the years 1994 to 1997. For additional information, please see the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and Note 17 to our audited consolidated financial statements.

Meridian Medical Technologies

      Our Meridian Medical Technologies segment consists primarily of our auto-injector business. We pioneered the development, and are a manufacturer, of auto-injectors for the self-administration of injectable drugs. An auto-injector is a pre-filled, pen-like device that allows a patient or caregiver to automatically inject a precise drug dosage quickly, easily, safely and reliably. Auto-injectors are a convenient, disposable, one-time use drug delivery system designed to improve the medical and economic value of injectable drug therapies.

      The commercial pharmaceutical business of our Meridian segment primarily consists of EpiPen®, an auto-injector filled with epinephrine for the emergency treatment of anaphylaxis resulting from severe or allergic reactions to insect stings or bites, foods, drugs and other allergens, as well as idiopathic or exercise induced anaphylaxis. Dey L.P. markets EpiPen® pursuant to a supply agreement that expires December 31, 2010. Under the terms of the supply agreement, we grant Dey the exclusive right and license to market, distribute and sell EpiPen® worldwide.

      Our Meridian segment also has pharmaceutical products that are presently sold primarily to the DoD, under an Industrial Base Maintenance Contract. These products incl