Forest Laboratories (FRX)

FOREST LABORATORIES, INC. REPORTS FISCAL FIRST QUARTER 2008 EARNINGS PER SHARE OF $0.83

NEW YORK, July 17, 2007 - Forest Laboratories, Inc. (NYSE: FRX), an international pharmaceutical manufacturer and marketer, today announced that fully diluted earnings per share equaled $0.83 in the first quarter of fiscal 2008. Reported earnings included an $8.9 million (after tax) charge for stock option expense in accordance with Statement of Financial Accounting Standard 123R. Reported earnings per share in the June 2006 quarter were $0.62.

Revenues for the quarter increased 14% to $928,274,000 from $816,338,000 in the year-ago period.
Net revenues were comprised of net sales, which increased 11% to $842,616,000 from $758,768,000 in the prior year. Sales in the quarter included $552,313,000 for Lexapro® (escitalopram oxalate), our SSRI for the treatment of depression and anxiety in adults, an increase of 9% from last year. Namenda®, our NMDA receptor antagonist for the treatment of moderate and severe Alzheimer’s disease, recorded sales of $191,719,000 during the quarter, growth of 27% from last year. Also included in net revenues was other income of $85,658,000 which includes contract revenue of $52,543,000 from the Benicar®* (olmesartan medoxomil) co-promotion agreement, an increase of 26%. The remaining component of other income was principally interest income, which totaled $26,738,000.

Net income in the current quarter increased 34% to $268,162,000 from $200,607,000 in the first quarter of the prior fiscal year. Selling, general and administrative expense increased 7% to $261,328,000. Research and development spending decreased 2% to $136,908,000 compared to the year-ago period and included product milestone development expenses totaling approximately $28,500,000 made to three different partner companies. In the year-ago period, research and development spending included an upfront payment of $60,000,000 to Almirall for the U.S. rights to aclidinium (LAS34273), a compound being investigated for the treatment of chronic obstructive pulmonary disease.

Fully diluted shares outstanding at June 30, 2007 were 321,921,000, a reduction of approximately 4 million shares compared to the year-ago period due mainly to the Company’s share repurchase program. During the just-completed quarter, the Company repurchased approximately 1.8 million shares leaving an additional 12.9 million shares available for repurchase under the existing program, which has no expiration date.