8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

Current Report Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934

July 23, 2008

Date of Report (Date of earliest event reported)

OSI PHARMACEUTICALS, INC.

(Exact name of registrant as specified in its charter)

Delaware	0-15190	13-3159796
(State or other jurisdiction of	(Commission	(I.R.S. Employer
incorporation)	File Number)	Identification No.)

41 Pinelawn Road
Melville, NY 11747

(Address of principal executive offices)

(631) 962-2000

(Registrant’s telephone number, including area code)

N/A

(Former name or former address,

if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a- 12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

TABLE OF CONTENTS

EX-99.1: PRESS RELEASE

EX-99.2: TEXTUAL REPRESENTATION OF WEBCAST

Item 2.02. Results of Operations and Financial Condition.

     On July 23, 2008, OSI Pharmaceuticals, Inc. (“OSI”) issued a press release regarding its financial results for the quarter ended June 30, 2008. A copy of this release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

     The information in this Item 2.02 (including Exhibit 99.1) is being “furnished” and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, whether made before or after the date of this report, except as shall be expressly set forth by specific reference in such filing.

Item 8.01. Other Events.

     On July 23, 2008, OSI held a webcast conference call regarding its financial results for the quarter ended June 30, 2008 as well as an update regarding OSI’s business. A textual representation of certain portions of the conference call is attached as Exhibit 99.2 to this Form 8-K and is incorporated herein by reference.

     This Current Report on Form 8-K contains “forward-looking statements” that do not convey historical information, but relate to predicted or potential future events, such as statements of our plans, strategies and intentions. These statements can often be identified by the use of forward-looking terminology such as “believe,” “expect,” “intend,” “may,” “will,” “should,” or “anticipate” or similar terminology. All statements other than statements of historical facts included in this Current Report on Form 8-K are forward-looking statements. All forward-looking statements speak only as of the date of this Current Report on Form 8-K. Except for OSI’s ongoing obligations to disclose material information under the federal securities laws, OSI undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. In addition to the risks and uncertainties of ordinary business operations and conditions in the general economy and the markets in which OSI competes, the forward-looking statements of the Company contained in this Current Report on Form 8-K are also subject to various risks and uncertainties, including those set forth in Item 1A, “Risk Factors”, in OSI’s Annual Report on Form 10-K, as amended, for the fiscal year ended December 31, 2007, and in its subsequent filings made with the Securities and Exchange Commission.

Item 9.01. Financial Statements and Exhibits.

Exhibit No.	Description
99.1	Press release dated July 23, 2008.
99.2	Textual representation of certain portions of the webcast conference call held on July 23, 2008.

2

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.

Date: July 25, 2008	OSI PHARMACEUTICALS, INC.
	By:	/s/ Barbara A. Wood
		Barbara A. Wood
		Senior Vice President, General Counsel and Secretary

3

EXHIBIT INDEX

Exhibit No.	Description
99.1	Press release dated July 23, 2008.
99.2	Textual representation of certain portions of the webcast conference call held on July 23, 2008.

4

EX-99.1

Exhibit 99.1

NEWS RELEASE

Contacts:
OSI Pharmaceuticals, Inc.	Burns McClellan, Inc. (representing OSI)
Kathy Galante (investors/media)	Justin Jackson/Kathy Nugent (media)
631-962-2043	212-213-0006
Kim Wittig (media)
631-962-2135

OSI Pharmaceuticals Announces Second Quarter 2008 Financial Results

—Reports Earnings of $0.61 Per Share From Continuing Operations —Tarceva Global Net Sales of $292
Million, Up 37% Over the Second Quarter of 2007

MELVILLE, N.Y.—(BUSINESS WIRE)—July 23, 2008—OSI Pharmaceuticals, Inc. (NASDAQ: OSIP) announced today its financial results for the Company’s second quarter ended June 30, 2008. The Company reported net income from continuing operations of $37.2 million (or $0.61 per share) for the three months ended June 30, 2008, compared with net income from continuing operations of $29.3 million (or $0.48 per share) for the second quarter of 2007.

The Company reported total revenues from continuing operations of $96 million for the second quarter of 2008 compared to revenues of $79 million for the second quarter of 2007, an increase of 21%. The increase is primarily due to the growth in revenues arising from worldwide Tarceva(R) (erlotinib) sales. Total worldwide net sales of Tarceva for the second quarter of 2008, as reported to OSI by the Company’s collaborators for Tarceva, Genentech, Inc. and Roche, were approximately $292 million representing a 37% growth in global sales compared to the same period last year. For the six months ended June 30, 2008, worldwide Tarceva net sales were approximately $559 million representing a 36% increase over the same period last year.

Total revenues from continuing operations for the second quarter of 2008 are comprised of the following key items:

• Net revenues from the unconsolidated joint business for Tarceva of $52 million, compared to $43 million in the second quarter of 2007, arising from the Company’s co-promotion arrangement with Genentech. The net revenues are based on total U.S. Tarceva sales of $119 million, compared to $102 million in the second quarter of 2007. Sales for the second quarter of 2007 were negatively impacted by approximately $9 million of reserve adjustments due to unusually high product returns related to expiring inventory returned to Genentech;

• Royalties of $35 million compared to $23 million in the second quarter of 2007 from Roche, the Company’s international partner for Tarceva. The royalty revenues are based on total rest of world sales of approximately $173 million, an increase of 55% compared to the $111 million reported in the second quarter of 2007;

• License, milestone and other revenues of $9 million compared with $13 million in the second quarter of 2007. The decrease is comprised primarily of the inclusion of amortization of an upfront license fee in 2007 related to the outlicense of our Glucokinase Activator program to Eli Lilly and Company in January 2007,

partially offset by an increase in royalty income related to worldwide non-exclusive licensing agreements under the Company’s DP-IV patent portfolio covering the use of DP-IV inhibitors for treatment of type 2 diabetes.

Operating expenses from continuing operations for the second quarter of 2008 were $56 million, compared to $54 million for last year’s second quarter. Research and development expense for the second quarter of 2008 increased to $30 million compared to $27 million for last year’s second quarter. Selling, general and administrative expenses for the second quarter of 2008 decreased to $23 million compared to $24 million for the second quarter of 2007. Operating expenses for the second quarter of 2008 included $4.4 million (or $0.07 per share) of equity related compensation expense, compared to $4.0 million (or $0.06 per share) for the second quarter of 2007.

Included in other income (expense) — net for the second quarter of 2007 is a $4 million gain recognized as a result of the Company’s decision to curtail its post-retirement medical plan.

Discontinued Operations

As a result of the Company’s decision to divest its eye disease business, or Eyetech, the operating results for Eyetech, for all periods presented, are shown as discontinued operations in the accompanying consolidated statement of operations. In July 2008, the Company signed an agreement for the divestiture of the Company’s remaining eye disease business assets.

The Company’s net income, including results from discontinued operations, was $25.3 million (or $0.43 per share) for the three months ended June 30, 2008, compared with a net income of $19.6 million (or $0.33 per share) reported for the second quarter of 2007.

Conference Call

OSI will host a conference call reviewing the Company’s financial results, product portfolio and business developments on July 23, 2008 at 5:00PM (Eastern Time). To access the live webcast or the fourteen-day archive via the Internet, log on to www.osip.com. Please connect to the Company’s website at least 15 minutes prior to the conference call to ensure adequate time for any software download that may be needed to access the webcast. Alternatively, please call 1-888-316-1372 (U.S.) or 1-913-312-0853 (international) to listen to the call. The conference ID number for the live call is 8594902. Telephone replay is available approximately two hours after the call through August 5, 2008. To access the replay, please call 1-888-203-1112 (U.S.) or 1-719-457-0820 (international). The conference ID number is 8594902.

About OSI Pharmaceuticals

OSI Pharmaceuticals is committed to “shaping medicine and changing lives” by discovering, developing and commercializing high-quality and novel pharmaceutical products designed to extend life and/or improve the quality of life for patients with cancer and diabetes/obesity. The Company’s oncology programs are focused on developing molecular targeted therapies designed to change the paradigm of cancer care. OSI’s diabetes/obesity efforts are committed to the generation of novel, targeted therapies for the treatment of type 2 diabetes and obesity. OSI’s flagship product, Tarceva(R) (erlotinib), is the first drug discovered and developed by OSI to obtain FDA approval and the only EGFR inhibitor to have demonstrated the ability to improve survival in both non-small cell lung cancer and pancreatic cancer patients in certain settings. OSI markets Tarceva through partnerships with Genentech, Inc. in the United States and with Roche throughout the rest of the world.

This news release contains forward-looking statements. These statements are subject to known and unknown risks and uncertainties that may cause actual future experience and results to differ materially from the statements made. Factors that might cause such a difference include, among others, the completion of clinical trials, the FDA review process and other governmental regulation, OSI’s and its collaborators’ abilities to successfully develop and commercialize drug candidates, competition from other pharmaceutical companies, the ability to effectively market products, and other factors described in OSI Pharmaceuticals’ filings with the Securities and Exchange Commission.

OSI Pharmaceuticals, Inc. and Subsidiaries
Selected Financial Information
Consolidated Statements of Operations
(In thousands, except per share data)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2008			2007			2008			2007
	Unaudited			Unaudited			Unaudited			Unaudited
Revenues:
Net revenue from unconsolidated joint business	$	51,941		$	42,999		$	101,736		$	82,121
Royalties on product licenses		35,020			22,546			66,603			41,839
License, milestone and other revenues		8,693			13,338			18,050			32,392
Total revenues		95,654			78,883			186,389			156,352
Expenses:
Cost of goods sold		2,061			2,047			4,231			3,951
Research and development		30,406			27,269			60,955			57,895
Selling, general and administrative		23,192			24,038			47,723			49,167
Amortization of intangibles		636			459			1,238			917
Total expenses		56,295			53,813			114,147			111,930
Income from continuing operations		39,359			25,070			72,242			44,422
Other income (expense):
Investment income — net		2,960			2,995			6,694			6,090
Interest expense		(3,015	)		(1,809	)		(6,146	)		(3,612	)
Other income (expense) — net		(1,129	)		3,517			(2,136	)		3,079
Income from continuing operations before income taxes		38,175			29,773			70,654			49,979
Income tax provision		958			497			1,774			1,008
Net income from continuing operations		37,217			29,276			68,880			48,971
Loss from discontinued operations		(11,919	)		(9,654	)		(14,345	)		(22,708	)
Net income	$	25,298		$	19,622		$	54,535		$	26,263

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2008			2007			2008			2007
	Unaudited			Unaudited			Unaudited			Unaudited
Basic and diluted income (loss) per common share:
Basic income (loss)
Continuing operations	$	0.65		$	0.51		$	1.21		$	0.85
Discontinued operations	$	(0.21	)	$	(0.17	)	$	(0.25	)	$	(0.40	)
Net income	$	0.44		$	0.34		$	0.95		$	0.46
Diluted income (loss)
Continuing Operations*	$	0.61		$	0.48		$	1.14		$	0.82
Discontinued operations	$	(0.19	)	$	(0.16	)	$	(0.22	)	$	(0.37	)
Net income	$	0.43		$	0.33		$	0.91		$	0.45
Weighted average shares of common stock outstanding:
Basic shares		57,083			57,545			57,107			57,424
Diluted shares		63,840			62,182			64,248			61,958
*Computation of diluted income per share form continuing operations:
Net income from continuing operations	$	37,217		$	29,276		$	68,880		$	48,971
Add: Interest and issuance cost related to dilutive convertible debt		1,943			760			4,162			1,551
Net income from continuing operations — diluted	$	39,160		$	30,036		$	73,042		$	50,522
Basic shares		57,083			57,545			57,107			57,424
Dilutive effect of options and restricted stock		554			729			618			626
Dilutive effect of the 2025 Notes		3,908			3,908			3,908			3,908
Dilutive effect of the 2023 Notes**		2,295			—			2,615			—
Dilutive effect of the 2038 Notes** (issued in January 2008)		—			—			—			—
Diluted shares		63,840			62,182			64,248			61,958

** Under the “if-converted” method, common share equivalents related to our 2038 Notes were not included in diluted earnings per share for the three and six months ended June 30, 2008 because their effect would be anti-dilutive. Common share equivalents related to our 2023 Notes were not included in diluted earnings per share for the three and six months ended June 30, 2007 because their effect would be anti-dilutive.

	June		December
	30,		31,
	2008		2007
	Unaudited
Cash and investments securities (including restricted investments)	$	435,099	$	305,098

EX-99.2

Exhibit 99.2

On July 23, 2008, OSI Pharmaceuticals, Inc. (the “Company”) held a webcast conference call regarding its financial results for the quarter ended June 30, 2008 as well as an update on the Company’s business. The following represents a textual representation of remarks by Kathy Galante, Investor Relations, Colin Goddard, Ph.D., Chief Executive Officer of the Company, and Michael G. Atieh, Executive Vice President, Chief Financial Officer and Treasurer of the Company.

Operator

[Operator’s Instruction]

Kathy Galante

Good afternoon and welcome to our second quarter earnings call. Joining me today, I have Colin Goddard, our Chief Executive Officer; Mike Atieh, our Chief Financial Officer; Gabe Leung, President of our Oncology Business; and Anker Lundemose, President of our Diabetes/Obesity Business. We will begin with Mike, who will provide you with a summary of the financial results, after which Colin will come back and discuss corporate developments and our oncology and diabetes/obesity program.

Before we begin, I would like remind you that we will be making forward-looking statements relating to the financial results and clinical and regulatory developments on the call today. These statements cover many events that are outside of OSI’s control and are subject to various risks that could cause the results to differ materially from those expressed in any forward-looking statements. I refer you to our SEC filings for a detailed description of the risk factors affecting our business. Now over Mike.

Michael Atieh

[Michael Atieh discusses quarter end information.]

Colin Goddard

Thanks, Mike. First, let me take a moment to put some closure around our discontinued eye business operation. We signed a definitive agreement with a new company, led largely by the Eyetech sales leadership, to transfer the Macugen business in a deal focused on delivering participation for OSIP in any successful turnaround situation. The transaction, which will close in early August, removes uncertainty surrounding the brand’s future and offers the opportunity for the NewCo team to launch the recently FDA approved leur lock presentation of the product.

It also brings closure to this very disappointing chapter in the Company’s history and allows us to turn our sole focus onto our core oncology and diabetes operations. Despite tumultuous times in the overall economy, on Wall Street and in our sector, we have continued to make good progress in all three key areas of our business during the second quarter. We’ve been able to deliver strong overall financial performance, driven by solid growth in Tarceva U.S. and global sales. We have also seen positive competitive developments and good clinical progress for Tarceva, along with meaningful progress in our development pipeline on both the oncology and diabetes/obesity sides of the business.

The quarter-on-quarter increase in US Tarceva sales included some impact of the separate price increase but also some fundamental unit volume growth. Market research indicates that second-line non-small cell lung cancer’s share has remained approximately stable while first-line pancreatic cancer’s share has increased (to over 40%, according to the Genentech tracking data). Rest-of-the-world growth was driven by solid European and Asian gains and by strong uptake in Japan following the year-end launch by Chugai.

The requirement of the Japanese regulatory authorities to closely monitor an initial cohort of approximately 3,000 patients has been satisfactorily enrolled. This, along with the revised appraisal document issued in early July by the appraisal committee of the UK’s NICE authority finally recommending Tarceva as a cost-effective alternative to

docetaxel in the second-line non-small cell lung cancer (which could result in fourth-quarter formal NICE approval) constitute important growth drivers in advance of potential upcoming label expansions if the SATURN — that’s the front-line maintenance — and BETA, the second-line Avastin/Tarceva combination Phase III trials, are positive.

Much investor attention in the first half of 2008 has been focused on key competitive data for Erbitux, Alimta and Zactima, the first two of which were the subject of ASCO presentations in early June. Both datasets were somewhat below many investors’ expectations, and while the Erbitux FLEX data was particularly disappointing for cancer patients in the oncology community at large, the data served to reinforce the value of Tarceva as the oral EGFR-targeted therapy in lung cancer.

The much-awaited Erbitux FLEX data did not, in our view, pose a major competitive threat to Tarceva; and, absent any further positive supported data, we do not believe that first-line Erbitux/chemo combination regimens will become a standard of care either in the U.S. or overseas.

The observation that Alimta appears to have little or no benefit in the squamous cell carcinoma sub-population of non-small cell lung cancer patients could have implications both immediately in the second line non-small cell lung cancer setting (recall that Tarceva demonstrated a hazard ratio of 0.67 in this patient population in the pivotal BR.21 study) and, longer-term, in the maintenance and front-line settings.

We believe that the positive Alimta maintenance Phase III data in the overall trial population indicates that this new approach to lung cancer treatment has potential merit in the management of the disease, and we look forward to data from our SATURN maintenance trial and, if positive, believe that Tarceva offers a unique value proposition in this setting, based upon convenience of oral route of delivery, cost and tolerability.

We are still awaiting results from the ZEST trial (of Zactima versus Tarceva) but attention has appropriately switched to the anticipated top-line data from both the SATURN and BETA Phase III trials, which are both on track for reporting during this half of the year. Enrollment was completed in both of these studies during the second quarter.

Enrollment was also completed in a third Phase III trial: the ATLAS study, which examines the use of Avastin and Tarceva in combination as a first-line maintenance regimen. Thus, as we plan for the growth of the business in 2009, we expect to have the ability to develop a comprehensive view of Tarceva’s near and mid-term prospects based upon a full appraisal of the data from our Phase III SATURN and BETA trials and a good assessment of key competitor threats.

In addition to delivering strong financial performance and executing on our Tarceva program, the key to building the longer-term strategic value of the business is the evolution of a differentiated pipeline of owned and control assets behind Tarceva. In this regard, we have recently initiated two clinical programs, one in oncology and one in diabetes/obesity.

In oncology, our next-generation mTOR inhibitor, OSI-027, recently began Phase I trials. OSI-027 is a potentially first-in-class oral, small-molecule direct inhibitor of the mTOR kinase activity and, as such, blocks signaling through both the TORC-1 and TORC-2 signaling complexes, whereas existing mTOR inhibitors (such as Temsirolimus and Everolimus, or so-called rapalogs) are only effective in blocking signaling through the TORC-1 complex. Preclinical data indicates robust anti-tumor activity for OSI-027, albeit with a more severe side-effect profile.

The Phase I trial will explain the dose and regimen options as well as, in combination with our translational research efforts, evaluating options for any potential biomarker directed patient selection protocols.

We also initiated Phase I trials for PSN602, the first OSI anti-obesity agent to enter clinical trials from our wholly-owned UK-based diabetes/obesity subsidiary, Prosidion. PSN602 is an oral, small-molecule dual serotonin and noradrenaline reuptake inhibitor and 5HT_1A agonist being developed for the treatment of obesity. PSN602 is designed to avoid the acute cardiovascular side-effects associated with higher doses of the approved agent, Meridia, while delivering superior weight loss benefits.

Both OSI-027 and PSN602 were discovered internally by the Company’s oncology and diabetes/obesity research organizations in Farmingdale, New York and Oxford, England, respectively. PSN821, our internally discovered

GPR119 agonist for which pre-clinical data shows both substantial glucose lowering and meaningful weight loss, was presented at this year’s ADA meeting and is on track for entry into the clinic in the fall. This will bring OSI’s clinical portfolio to five (including OSI-930, our c-kit VEGF receptor inhibitor, and OSI-906, our oral small-molecule IGF-1 receptor inhibitor) all of which are the products of our internal research investments.

While first-half R&D expenses have, as Mike mentioned, run below expectations, it is reasonable to expect that we will correct this somewhat throughout the second half, as we continue to initiate these more extensive clinical development efforts. From a more strategic perspective, we remain committed to developing a highly innovative pipeline of assets and to focusing our investments on those agents for which we have a clear differentiation strategy. In this way, while we can expect our R&D spend to increase over the coming years as these agents and others move forward into clinical development, we can also establish a clear value creation thesis for our investors.

In this light, some assets, such as OSI-930, may benefit from a more comprehensive development strategy carried out in collaboration with a global or a regional partner and we have continued to explore this possibility simultaneously with the ongoing Phase I program.

In summary, having met our core post-approval goal of taking the Company profitable within three years of Tarceva launch, we believe we are now well poised to deliver an exciting investment proposition in the mid-cap biotech space. If we have successful outcomes from the upcoming Phase III trials for Tarceva, we believe our flagship product will be in a position for continued global sales growth aided by likely late 2009 label expansions in key markets. This will allow us to maintain strong financial performance even as we invest to draw out the value we believe to be inherent in our oncology and diabetes/obesity clinical pipelines and further validate our R&D platforms.

We will continue to seek opportunities to add tactically to our pipeline and technological capabilities externally, but are committed to doing so in a fiscally disciplined manner so that we can maintain an effective balance between financial performance and medium and longer-term R&D investments.

We will now be happy to take your questions, so over to you, Erin.

[Dr. Goddard provided concluding remarks and a question and answer session then followed.]