SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [ ]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[X] Soliciting Material Pursuant to Rule 14a-12
MERIDIAN MEDICAL TECHOLOGIES, INC.
--------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
KING PHARMACEUTICALS, INC.
--------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials:
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
N E W S R E L E A S E
(KING PHARMACEUTICALS LOGO)
--------------------------------------------------------------------------------
FOR IMMEDIATE RELEASE
KING PHARMACEUTICALS REPORTS MERIDIAN MEDICAL TECHNOLOGIES'
ANNOUNCEMENT OF FINANCIAL RESULTS FOR FIRST QUARTER OF FISCAL 2003
BRISTOL, TENNESSEE, December 10, 2002 - King Pharmaceuticals, Inc. (NYSE:KG)
reported today that Meridian Medical Technologies, Inc. (NASDAQ:MTEC) announced
its first quarter of fiscal 2003 financial results. Meridian reported total
revenue of $24.8 million for the three months ended October 31, 2002, compared
to revenues of $14.8 million for the same period last year, an increase of 68
percent, and net income of $2.43 million compared to $1.16 million, an increase
of 109 percent, over the same period of the prior year.
King announced on October 21, 2002 that it signed a definitive agreement to
acquire Meridian for a cash price of $44.50 per share of Meridian common stock,
totaling $247.8 million. The boards of directors of both companies have approved
unanimously the terms of the agreement. King will finance the acquisition out of
the Company's available cash. Closing of the transaction is subject to approval
by the holders of a majority of the outstanding common stock of Meridian,
appropriate governmental approval, and other customary conditions, and is
expected to be completed before the end of January 2003.
Jefferson J. Gregory, Chairman and Chief Executive Officer of King, said, "This
solid performance by Meridian supports our belief that this transaction offers
excellent opportunities for growth and should produce a very good return for our
shareholders. As stated previously, we believe King's acquisition of Meridian
represents an excellent business combination, providing King with additional
lines of growing exclusive pharmaceutical products, preeminent auto-injector
technology, and enhanced pipeline opportunities. The acquisition represents the
combination of a premier specialty pharmaceutical company with the innovative
leader in auto-injector technology."
The Meridian press release announcing results for the first quarter of fiscal
2003 follows:
MERIDIAN MEDICAL REPORTS 68 PERCENT RISE IN REVENUE AND 109 PERCENT
RISE IN NET INCOME FOR THE FIRST QUARTER OF FISCAL 2003
Columbia, Maryland (December 10, 2002) - Meridian Medical Technologies,
Inc. (NASDAQ: MTEC), a world leader in drug delivery technology and
innovative cardiopulmonary diagnostics, today reported total revenue of
$24.8 million and net income of $2.43 million, or $0.46 per fully
diluted share, for the three months ended October 31, 2002, compared to
revenues of $14.8 million and net income of $1.16 million, or $0.32 per
diluted share, for the same period last year.
"Meridian experienced an outstanding quarter from both an operational
and a strategic perspective," commented James H. Miller, Meridian's
chairman, president and CEO. "First, our exceptional results were
primarily driven by continuing strong demand for our government and
commercial auto-injector products. Government orders for our nerve
(MORE)
agent antidote auto-injectors during the first fiscal quarter have
outpaced prior periods as our military forces continue to heighten
levels of preparedness in response to the current global climate.
Moreover, we continue to see rising demand from state and local
governments along with other governmental agencies as Homeland Security
initiatives continue to progress. Finally, EpiPen(R), our flagship
product used for the emergency treatment of anaphylaxis, has continued
its impressive track record of double-digit growth as a result of
greater public awareness of food allergies and an overall increase in
the number of cases diagnosed and treated.
"More importantly," Mr. Miller continued, "in October, Meridian signed
a definitive agreement to be acquired by King Pharmaceuticals. This
transaction is expected to create new growth opportunities for
Meridian. We look forward to closing the transaction in early 2003,
subject to receipt of shareholder approval and satisfaction of other
customary conditions."
FINANCIAL RESULTS
Gross profits totaling $11.4 million increased to 46.0 percent of
revenues during the first quarter of fiscal 2003, compared to 45.3
percent for the same year ago period. The slight increase in margin was
influenced by product mix, as there were comparatively higher sales of
lower margin products, primarily auto-injectors sold to the Department
of Defense ("DoD") under the Industrial Base Maintenance Contract. The
company expects the gross margin in fiscal 2003 to match the high level
achieved in fiscal 2002.
Commercial Systems revenue for the three months ended October 31, 2002,
was $10.3 million compared to $9.0 million for the comparable prior
year period, a 14.3 percent increase. Demand for EpiPen remains strong
with sales increasing 30.5 percent from the first quarter of fiscal
2002, to $10.0 million. The increase in EpiPen revenue was partially
offset by lower R&D service revenue due to the timing of development
projects.
Government Systems revenues of $13.0 million for the three months ended
October 31, 2002 more than doubled from the $5.1 million in same year
ago period. DoD revenues were $10.1 million for the three months ended
October 31, 2002, nearly tripling over the same period last year. This
dramatic increase in demand is a result of heightened military
readiness by U.S. Armed Forces. Foreign government revenues increased
slightly to $1.3 million for the fiscal first quarter, compared to $1.2
million for the same year ago period. Homeland Security sales were $1.7
million for the three months ended October 31, 2002 versus $475,000 for
the same year ago period. This increase reflects continued shipments of
nerve agent antidotes and other military auto-injector products to
state and local first responders under the Metropolitan Medical
Response System, and to other non-military agencies, such as the
Department of Health and Human Services, to support the government's
Homeland Security initiatives.
Cardiopulmonary Systems revenues were $1.5 million for the three months
ended October 31, 2002 compared to $689,000 for the same year ago
period. This increase was due to stronger telemedicine sales compared
to last year, resulting from the delivery of backlog from the fourth
quarter of fiscal 2002.
Operating costs for the three months ended October 31, 2002 were $7.0
million compared to $4.0 million incurred in the same period last year.
The current quarter
included over $1.1 million in external costs relating to the pending
merger with King. Higher costs also resulted from continued investment
in the marketing of PRIME ECG, as well as market research for the
company's specialty pharmaceutical initiative.
The quarter benefited from a $580,000 reduction in interest expense as
the company had essentially no external borrowing.
Meridian Medical Technologies, a specialty pharmaceuticals company, is
a world leader in sales of auto-injector drug delivery systems and the
developer of the PRIME ECG cardiac mapping system marketed in the
United States and Europe. The company develops health care products
designed to save lives, reduce health care costs and improve quality of
life. Additional company information is available online at
www.meridianmeds.com.
King, headquartered in Bristol, Tennessee, is a vertically integrated
pharmaceutical company that manufactures, markets, and sells primarily branded
prescription pharmaceutical products. King, an S&P 500 Index company, seeks to
capitalize on opportunities in the pharmaceutical industry created by cost
containment initiatives and consolidation among large global pharmaceutical
companies. King's strategy is to acquire branded pharmaceutical products and to
increase their sales by focused promotion and marketing and through product life
cycle management.
This release contains forward-looking statements which reflect management's
current views of future events and operations, including, but not limited to,
statements pertaining to King's planned acquisition of Meridian, statements
pertaining to the growth of Meridian's current lines of exclusive pharmaceutical
products, including, but not limited to, EpiPen(R) and Meridian's nerve gas
antidote, statements pertaining to the enhanced pipeline opportunities provided
King by its acquisition of Meridian, and statements pertaining to opportunities
for growth created by King's acquisition of Meridian and the resulting return
for King's shareholders. These forward-looking statements involve certain
significant risks and uncertainties, and actual results may differ materially
from the forward-looking statements. Some important factors which may cause
results to differ include: the ability of King and Meridian to consummate the
contemplated transaction described above, dependence on approval of the
transaction by the shareholders of Meridian, dependence on the ability of King
and Meridian to obtain all necessary government approvals of the transaction,
dependence on management of King's growth and integration of its acquisitions,
specifically including, but not limited to, the contemplated acquisition, the
ability of King to realize potential synergies from the contemplated
acquisition, dependence on King's ability to successfully transfer the
manufacture of Meridian's products to King's existing manufacturing facilities
in compliance with the requirements of the FDA and other governmental
authorities, dependence on growth of net sales of King's branded pharmaceutical
products, in particular, Altace(R), Levoxyl(R), and Thrombin-JMI(R), as well as
revenue and earnings per share, at a rate equal to or in excess of management's
projections, dependence on growth of net sales of Meridian's pharmaceutical
products, dependence on the ability of Dey to successfully promote EpiPen(R),
dependence on the successful marketing and sales of King's and Meridian's
products, dependence on King's ability to continue to acquire branded products,
including through the acquisition of other pharmaceutical companies, the high
cost and uncertainty of research, clinical trials, and other development
activities involving pharmaceutical products, dependence on King's ability to
successfully develop civilian formulations of a nerve gas antidote utilizing
Meridian's patented dual chambered auto-injector and injection process,
dependence on FDA approval of the ANDA now pending on DiaJect(R) and King's
ability to successfully continue that approval process, dependence on King's
ability to successfully develop new and innovative products utilizing Meridian's
exclusive auto-injector technology, dependence on King's ability to
successfully launch and market DiaJect(R) and civilian formulations of a nerve
gas antidote utilizing Meridian's patented dual chambered auto-injector and
injection process, the unpredictability of the duration and results of the FDA's
review of Investigational New Drug Applications, New Drug Applications, and
Abbreviated New Drug Applications and/or the review of other regulatory agencies
worldwide, dependence on King's ability to maintain effective patent protection
for Meridian's dual chambered auto-injector and injection process through 2010,
dependence on the ability of King's dedicated field sales force representatives
to successfully market King's branded pharmaceutical products, dependence on the
ability of King's dedicated field sales force representatives to successfully
market DiaJect(R) and civilian formulations of a nerve gas antidote utilizing
Meridian's patented dual chambered auto-injector and injection process,
dependence on the availability and cost of raw materials for King's and
Meridian's products, dependence on King's ability to successfully negotiate,
enter into, and maintain governmental contracts in relation to Meridian's
pharmaceutical products, including in particular contracts with the U.S.
Department of Defense, dependence on no material interruptions in supply by
contract manufacturers of King's or Meridian's products, dependence on the
potential effect on sales of King's existing branded pharmaceutical products and
Meridian's pharmaceutical products as a result of the potential development and
approval of a generic substitute for any such product or other new competitive
products, dependence on whether our customers order pharmaceutical products in
excess of normal quantities during any quarter which could cause our sales of
branded pharmaceutical products to be lower in a subsequent quarter than they
would otherwise have been, dependence on the potential effect of future
acquisitions and other transactions pursuant to our growth strategies on King's
financial and other projections, dependence on our compliance with FDA and other
government regulations that relate to our business, and dependence on changes in
general economic and business conditions, changes in current pricing levels,
changes in federal and state laws and regulations, and manufacturing capacity
constraints. Other important factors that may cause actual results to differ
materially from the forward-looking statements are discussed in the "Risk
Factors" section and other sections of King's Form 10-K for the year ended
December 31, 2001 and Form 10-Q for the quarter ended September 30, 2002, which
are on file with the Securities and Exchange Commission. King has not
independently reviewed the financial results reported by Meridian in their press
release dated December 10, 2002. King does not undertake to publicly update or
revise any of its forward-looking statements even if experience or future
changes show that the indicated results or events will not be realized.
Meridian will be filing a proxy statement and other relevant documents
concerning the transaction with the Securities and Exchange Commission (the
"SEC"). STOCKHOLDERS AND INVESTORS ARE URGED TO READ THE PROXY STATEMENT AND ANY
OTHER RELEVANT DOCUMENTS FILED WITH THE SEC BECAUSE THEY CONTAIN IMPORTANT
INFORMATION. Investors will be able to obtain the documents free of charge at
the SEC's website, www.sec.gov. In addition, documents filed with the SEC by
Meridian will be available free of charge from Meridian's Manager, Investor
Relations & Corporate Communications, Lenny Santiago, 10240 Old Columbia Road,
Columbia, MD 21046 (tel. no. (443) 259-7842). READ THE PROXY STATEMENT CAREFULLY
BEFORE MAKING A DECISION CONCERNING THE MERGER.
Information regarding the identity of the persons who may, under SEC rules, be
deemed to be participants in the solicitation of stockholders of Meridian in
connection with the transaction, and their interests in the solicitation, is set
forth in a filing made by Meridian with the SEC on October 21, 2002.
# # #
Contact:
KING: James E. Green, Vice President, Corporate Affairs
423-989-8125
EXECUTIVE OFFICES
KING PHARMACEUTICALS
501 FIFTH STREET, BRISTOL, TENNESSEE 37620