INDUSTRY SEGMENT INFORMATION

6 Months Ended

Jun. 30, 2011

INDUSTRY SEGMENT INFORMATION

INDUSTRY SEGMENT INFORMATION

NOTE K - INDUSTRY SEGMENT INFORMATION

The Company classifies its operations into four business segments: ophthalmic, hospital drugs & injectables, biologics & vaccines, and contract services. The ophthalmic segment manufactures, markets and distributes diagnostic and therapeutic pharmaceuticals, as well as OTC eye care products. The hospital drugs & injectables segment manufactures, markets and distributes drugs and injectable pharmaceuticals, primarily in niche markets. The contract services segment manufactures products for third party pharmaceutical and biotechnology customers based on their specifications. The biologics & vaccines segment, which the Company exited during the first quarter of 2010, marketed adult Tetanus-Diphtheria (“Td”) and Flu vaccines directly to hospitals and physicians as well as through wholesalers and national distributors.

The Company was party to an Exclusive Distribution Agreement with the Massachusetts Biologic Laboratories of the University of Massachusetts Medical School (“MBL”) dated as of March 22, 2007 (the “MBL Distribution Agreement”) for the distribution of MBL's Td vaccine.  The Company exited the biologics & vaccines segment upon termination of the MBL Distribution Agreement on March 14, 2010.  The Company had terminated distribution of Flu vaccines during 2009.  The Company has not operated in the biologics & vaccines segment since March 31, 2010.

The Company's basis of accounting in preparing its segment information is consistent with that used in preparing its consolidated financial statements.

Selected financial information by industry segment is presented below (in thousands):

	THREE MONTHS ENDED					SIX MONTHS ENDED
	JUNE 30,					JUNE 30,
	2011		2010			2011		2010
REVENUES
Ophthalmic	$	18,224	$	8,635		$	29,242	$	14,970
Hospital Drugs & Injectables		11,744		7,145			20,799		13,120
Contract Services		2,180		4,405			7,551		7,434
Biologics & Vaccines		-		-			-		5,181
Total revenues	$	32,148	$	20,185		$	57,592	$	40,705
GROSS PROFIT
Ophthalmic	$	10,892	$	5,021		$	18,078	$	8,137
Hospital Drugs & Injectables		6,095		3,163			10,956		5,387
Contract Services		896		1,679			3,102		2,705
Biologics & Vaccines		-		-			-		2,062
Total gross profit		17,883		9,863			32,136		18,291
Operating expenses		11,207		8,446			19,752		15,049
Operating income		6,676		1,417			12,384		3,242
Other income (expense), net		11,693		(10,817	)		12,335		(9,118	)
Income (loss) before income taxes	$	18,369	$	(9,400	)	$	24,719	$	(5,876	)

The Company manages its business segments to the gross profit level and manages its operating and other costs on a company-wide basis. Inter-segment activity at the gross profit level is minimal. The Company does not identify assets by segment for internal purposes, as certain manufacturing and warehouse facilities support more than one segment.