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License Agreement Royalty Adjustment Interest

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					          Condensed Consolidated Balance Sheets (USD $)
                                                                          Sep. 30, 2009
                              In Thousands
Current assets:
Cash (including cash equivalent investments of $1,735,362 in September
and $1,337,871 in March)                                                            $1,736,133
Marketable securities                                                                1,330,604
Accounts receivable, less allowance for doubtful accounts of $17,913 in
September and $18,511 in March                                                         484,664
Inventories, net                                                                       440,706
Deferred income taxes                                                                  228,215
Other current assets                                                                   104,437
Total current assets                                                                 4,324,759
Marketable securities and investments                                                     545,276
Property, plant and equipment                                                             595,681
Less: accumulated depreciation                                                            263,181
Property, plant and equipment, net                                                        332,500
Other assets:
Goodwill                                                                                   14,965
License agreements, product rights and other intangibles, less
accumulated amortization of $493,189 in September and $474,960 in
March                                                                                     480,149
Deferred income taxes                                                                      99,799
Other assets                                                                                1,325
Total other assets                                                                        596,238
Total assets                                                                         5,798,773
Current liabilities:
Accounts payable                                                                          124,213
Accrued expenses                                                                          744,270
Total current liabilities                                                                 868,483
Long-term liabilities:
Income tax liabilities                                                                    298,525
Stockholders' equity:
Series preferred stock, $1.00 par; shares authorized 1,000; no shares
issued or outstanding                                                                          0
Common stock, $.10 par; shares authorized 1,000,000; issued 422,465
shares in September and 422,268 shares in March                                          42,246
Additional paid-in capital                                                           1,514,310
Retained earnings                                                                    6,828,796
Accumulated other comprehensive loss                                                    (1,473)
Treasury stock, at cost (120,699 shares in September and 120,653
shares in March)                                                                   (3,752,114)
Total stockholders' equity                                                           4,631,765
Total liabilities and stockholders' equity                                          $5,798,773
Mar. 31, 2009




          $1,338,905
           1,242,017

             449,444
             393,527
             217,811
             144,250
           3,785,954
            449,793
            586,039
            240,104
            345,935

                14,965


            497,897
            100,758
              1,506
            615,126
           5,196,808

            117,192
            700,636
            817,828

            264,389


                    0

              42,227
           1,491,239
           6,379,236
            (47,145)

         (3,750,966)
           4,114,591
          $5,196,808
   Parenthetical Data to the Condensed Consolidated Balance
                         Sheets (USD $)
                                                                        Sep. 30, 2009
                            In Thousands
Current assets:
Cash equivalent investments                                                       $1,735,362
Accounts receivable, allowance for doubtful accounts                                  17,913
Other assets:
License agreements, product rights and other intangibles, accumulated
amortization                                                                       $493,189
Stockholders' equity:
Series preferred stock, par (in dollars per share)                                         1
Series preferred stock, shares authorized (in shares)                                  1,000
Series preferred stock, no shares issued (in shares)                                       0
Series preferred stock, no shares outstanding (in shares)                                  0
Common stock, par (in dollars per share)                                                 0.1
Common stock, shares authorized (in shares)                                        1,000,000
Common stock, issued shares (in shares)                                              422,465
Treasury stock, shares (in shares)                                                   120,699
Mar. 31, 2009


          $1,337,871
              18,511


           $474,960

                   1
               1,000
                   0
                   0
                 0.1
           1,000,000
             422,268
             120,653
     Condensed Consolidated Statements of Income (USD $)
                                                           3 Months Ended
                                                            Sep. 30, 2009
                In Thousands, except Per Share data
Net sales                                                              $962,714
Contract revenue                                                         50,590
Interest income                                                           9,411
Other income                                                             41,219
Total revenue                                                         1,063,934
Costs and expenses:
Cost of sales                                                           221,161
Selling, general and administrative                                     324,924
Research and development                                                263,079
Total costs and expenses                                                809,164
Income before income tax expense                                        254,770
Income tax expense                                                       68,108
Net income                                                             $186,662
Net income per common share:
Basic                                                                       $0.62
Diluted                                                                     $0.61
Weighted average number of common shares outstanding:
Basic                                                                   302,983
Diluted                                                                 303,530
3 Months Ended          6 Months Ended           6 Months Ended
 Sep. 30, 2008           Sep. 30, 2009            Sep. 30, 2008

            $925,570              $1,910,956               $1,819,315
              47,210                  98,299                  101,363
              19,194                  21,611                   37,424
                 532                  41,219                    1,248
             992,506               2,072,085                1,959,350

             205,001                 437,905                  402,342
             326,261                 636,731                  669,215
             146,357                 410,205                  258,469
             677,619               1,484,841                1,330,026
             314,887                 587,244                  629,324
              70,801                 137,684                  142,318
            $244,086                $449,560                 $487,006

                 $0.8                    $1.48                    $1.59
                 $0.8                    $1.48                    $1.59

             304,814                 302,952                  306,146
             305,938                 303,443                  307,126
Condensed Consolidated Statements of Comprehensive Income
                         (USD $)
                                                                          3 Months Ended
                                                                           Sep. 30, 2009
                             In Thousands
Net income                                                                            $186,662
Other comprehensive income (loss):
Foreign currency translation gains (losses)                                                295
Pension liability adjustment                                                          (11,558)
Unrealized gains (losses) on securities:
Unrealized holding gains (losses) arising during the period, net of tax                 19,561
Other comprehensive income (loss)                                                        8,298
Comprehensive income                                                                  $194,960
3 Months Ended         6 Months Ended         6 Months Ended
 Sep. 30, 2008          Sep. 30, 2009          Sep. 30, 2008

            $244,086               $449,560               $487,006

            (17,452)                 11,808               (17,813)
                   0               (11,558)                      0

            (10,512)                 45,422               (11,073)
            (27,964)                 45,672               (28,886)
            $216,122               $495,232               $458,120
   Condensed Consolidated Statements of Cash Flows (USD $)
                                                                      6 Months Ended
                                                                       Sep. 30, 2009
                             In Thousands
Cash flows from operating activities:
Net income                                                                        $449,560
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation                                                                         22,618
Amortization and impairments                                                         18,229
Stock-based compensation expense                                                     22,282
Deferred income tax (benefit) provision                                             (9,445)
Foreign currency transaction loss (gain)                                                 35
Decrease (increase) in:
Accounts receivable, net                                                           (35,220)
Inventories, net                                                                   (47,179)
Other current assets                                                                 39,813
Other assets                                                                            181
Increase (decrease) in:
Accounts payable                                                                     7,021
Accrued expenses                                                                    43,634
Income taxes liabilities                                                            34,136
Net cash provided by operating activities                                          545,665
Cash flows from investing activities:
Purchase of property, plant and equipment                                            (8,532)
Purchase of marketable securities and investments                               (1,335,269)
Redemption of marketable securities                                               1,151,199
Net cash (used in) provided by investing activities                               (192,602)
Cash flows from financing activities:
Net proceeds from common stock options exercised by employees under
stock option plans                                                                      821
Excess tax (provision) benefit related to stock-based compensation                     (13)
Purchase of treasury stock                                                          (1,148)
Net cash used in financing activities                                                 (340)
Effect of exchange rate changes on cash                                             44,505
Increase in cash and cash equivalents                                              397,228
Cash and cash equivalents, beginning of period                                   1,338,905
Cash and cash equivalents, end of period                                         1,736,133
Supplemental disclosures of cash flow information:
Cash paid for income taxes                                                         $94,710
6 Months Ended
 Sep. 30, 2008


            $487,006


              22,754
              35,895
              20,254
               5,927
               (630)

              22,964
            (25,696)
            (42,314)
                (10)

           (151,025)
             151,133
              23,104
             549,362

             (19,240)
          (1,247,144)
            1,309,441
               43,057



               3,378
                 236
           (332,459)
           (328,845)
            (26,784)
             236,790
             833,052
           1,069,842

            $135,342
                        Basis of Presentation
                                                    6 Months Ended
                                                     Sep. 30, 2009
                                                     USD / shares

Basis of Presentation [Abstract]
                                                1.Basis of
                                                Presentation: The
                                                accompanying unaudited
                                                condensed consolidated
                                                financial statements have
                                                been prepared in accordance
                                                with U.S. generally accepted
                                                accounting principles (or
                                                GAAP) for interim financial
                                                information and with the
                                                instructions to Form 10-Q
                                                and Accounting Standards
                                                Codification (or ASC) 270-
                                                10.Accordingly, they do not
                                                include all of the information
                                                and footnotes required by
                                                GAAP for complete financial
                                                statements.In the opinion of
                                                Management, all
                                                adjustments (consisting of
                                                only normal recurring
                                                accruals) considered
                                                necessary for a fair
                                                presentation have been
                                                included and the Company
                                                has evaluated subsequent
                                                events up to the date of this
                                                filing.Certain amounts as
                                                previously reported have
                                                been reclassified to conform
                                                to current year
Basis of Presentation                           classifications.Operating
                                                results for the six-month
                      Accounts Receivable
                                                6 Months Ended
                                                 Sep. 30, 2009
                                                 USD / shares

Accounts Receivable [Abstract]
                                            2.Accounts Receivable
                                            (In thousands):
                                            Accounts receivable,
                                            net, consists of the following:
                                             September 30,
                                            2009 (Unaudited)
                                            March 31, 2009

                                            Trade $
                                            383,378 $
                                            351,697 Other
                                             101,286
                                            97,747 $
                                            484,664 $
                                            449,444
Accounts Receivable
                         Inventories
                                           6 Months Ended
                                            Sep. 30, 2009
                                            USD / shares

Inventories [Abstract]
                                       3.Inventories (In
                                       thousands):
                                       Inventories, net of
                                       reserves for obsolescence,
                                       consist of the following:
                                        September 30,
                                       2009 (Unaudited)
                                       March 31, 2009

                                       Raw materials
                                       $ 164,708 $
                                       126,292 Work in
                                       process 845
                                       982 Finished
                                       goods 275,153
                                       266,253 $
                                       440,706 $
Inventories                            393,527
                    Fair Value Measurements
                                                  6 Months Ended
                                                   Sep. 30, 2009
                                                   USD / shares

Fair Value Measurements [Abstract]
                                              4.Fair Value
                                              Measurements (In
                                              thousands): The
                                              following table presents the
                                              level within the fair value
                                              hierarchy at which the
                                              Companys financial assets
                                              are carried at fair value and
                                              measured on a recurring
                                              basis: Description
                                              Fair value at
                                              September 30, 2009
                                               Quoted prices in
                                              active markets for identical
                                              assets (Level 1)
                                              Significant other
                                              observable market inputs
                                              (Level 2)
                                              Unobservable
                                              market inputs
                                              (Level 3)

                                              Money market
                                              accounts $ 1,548,870
                                               $ 1,548,870
                                                Municipal
                                              bonds and notes
                                              290,530
                                              $ 290,530
                                              Commercial paper
                                               1,089,375
Fair Value Measurements                       547,039
                                              542,336
                        Marketable Securities
                                                    6 Months Ended
                                                     Sep. 30, 2009
                                                     USD / shares

Marketable Securities [Abstract]
                                                5.Marketable
                                                Securities (In thousands):
                                                Available-for-sale debt
                                                securities consist of the
                                                following:
                                                September30, 2009
                                                 Estimated
                                                fair value Gains
                                                in accumulated other
                                                comprehensive income
                                                Losses in accumulated
                                                other comprehensive income
                                                Current:
                                                  Variable
                                                rate demand notes $
                                                135,394
                                                Municipal bonds and
                                                notes 189,274
                                                $ 1,029
                                                Commercial paper
                                                 922,854
                                                1,586
                                                Floating rate
                                                notes 83,082
                                                  $ (135 )
                                                Total current
                                                securities 1,330,604
                                                 2,615
                                                (135 )

                                                Noncurrent:
Marketable Securities
                                                Municipal bonds
              License and Collaboration Agreements
                                                         6 Months Ended
                                                          Sep. 30, 2009
                                                          USD / shares

License and Collaboration Agreements [Abstract]
                                                     6.License and
                                                     Collaboration Agreements (In
                                                     thousands): In August
                                                     2009, the Company entered
                                                     into a license agreement
                                                     with Nycomed GmbH (or
                                                     Nycomed) to develop and
                                                     commercialize Daxas
                                                     (roflumilast) in the United
                                                     States.Daxas is a proprietary
                                                     selective phosphodiesterase
                                                     4 (PDE4) enzyme inhibitor
                                                     for oral administration
                                                     developed by Nycomed for
                                                     the treatment of chronic
                                                     obstructive pulmonary
                                                     disease (COPD).Under the
                                                     terms of the agreement, the
                                                     Company made an upfront
                                                     payment to Nycomed of
                                                     $100,000 which was
                                                     recorded to research and
                                                     development expense.The
                                                     Company may be obligated
                                                     to make payments to
                                                     Nycomed for future
                                                     development and sales
                                                     milestones and royalties on
                                                     Daxas sales.The Company
                                                     may also be responsible for
                                                     certain development
License and Collaboration Agreements                 expenses incurred prior to
                                                     FDA approval. The
                       Net Income Per Share
                                                  6 Months Ended
                                                   Sep. 30, 2009
                                                   USD / shares

Net Income Per Share [Abstract]
                                              7.Net Income Per
                                              Share (In thousands):
                                              A reconciliation of
                                              shares used in calculating
                                              basic and diluted net income
                                              per share follows:
                                              Three Months Ended
                                               Six Months
                                              Ended
                                              September 30,
                                              September 30,
                                               2009
                                              2008
                                              2009
                                              2008 Basic
                                               302,983
                                              304,814
                                              302,952
                                              306,146 Effect
                                              of assumed conversion of
                                              employee stock options
                                              547 1,124
                                              491 980
                                              Diluted
                                              303,530 305,938
                                               303,443
                                              307,126
                                              Options to purchase
                                              approximately 17,228 shares
                                              of common stock at exercise
                                              prices ranging from $20.55
Net Income Per Share                          to $76.66 per share and
                                              options to purchase
                   Stock Based Compensation
                                                  6 Months Ended
                                                   Sep. 30, 2009
                                                   USD / shares

Stock-Based Compensation [Abstract]
                                              8.Stock-Based
                                              Compensation (In
                                              thousands): In August
                                              2007 the stockholders of the
                                              Company voted to adopt the
                                              2007 Equity Incentive Plan
                                              (or the 2007 Plan) which
                                              replaces and supersedes all
                                              prior stock option plans.
                                              Under the 2007 Plan, 13,950
                                              shares were authorized to be
                                              issued to employees of the
                                              Company and its subsidiaries
                                              at prices not less than the
                                              fair market value of the
                                              common stock at the date of
                                              grant.The 2007 Plan provides
                                              for the granting of incentive
                                              and nonqualified stock
                                              options, restricted stock,
                                              stock appreciation rights and
                                              stock equivalent units. These
                                              awards generally vest in
                                              three to five years. Stock
                                              option grants may be
                                              exercisable for up to ten
                                              years from the date of
                                              issuance. As of September
                                              30, 2009, 5,312 shares were
                                              available for grant.
                                              Compensation
Stock-Based Compensation                      expense of $10,460 ($8,634
                                              net of tax) and $22,282
                 Business Segment Information
                                                    6 Months Ended
                                                     Sep. 30, 2009
                                                     USD / shares

Business Segment Information [Abstract]
                                                9.Business Segment
                                                Information (In thousands):
                                                The Company
                                                operates in only one
                                                segment.Below is a
                                                breakdown of net sales by
                                                therapeutic class:
                                                Three Months Ended
                                                 Six Months
                                                Ended (In
                                                thousands)
                                                September 30,
                                                 September 30,
                                                 2009
                                                2008
                                                2009
                                                2008

                                                Central nervous
                                                system $ 855,948
                                                 $ 833,112 $
                                                1,694,980 $
                                                1,643,432
                                                Cardiovascular
                                                 47,754
                                                19,593 93,797
                                                 29,408
                                                Other
                                                59,012 72,865
                                                 122,179
                                                146,475 $
Business Segment Information                    962,714 $
                                                925,570 $
                       Long Term Debt
                                               6 Months Ended
                                                Sep. 30, 2009
                                                USD / shares

Long-term Debt, Unclassified [Abstract]
                                          10.Long-Term Debt:
                                          On December 7, 2007,
                                          the Company established a
                                          $500 million revolving credit
                                          facility for the purpose of
                                          providing additional financial
                                          liquidity for the financing of
                                          business development and
                                          corporate strategic
                                          initiatives.The facility can be
                                          increased up to $750 million
                                          based upon agreement with
                                          the participating lenders and
                                          expires on December 7,
                                          2012.As of November 6,
                                          2009, the Company has not
                                          drawn any funds from the
                                          available credit.The
                                          utilization of the revolving
                                          credit facility is subject to the
                                          adherence to certain
                                          financial covenants such as
                                          leverage and interest
                                          coverage ratios.
Long-Term Debt
                          Income Taxes
                                             6 Months Ended
                                              Sep. 30, 2009
                                              USD / shares

Income Taxes [Abstract]
                                         11.Income Taxes (In
                                         thousands): The
                                         Companys income tax
                                         returns for fiscal years prior
                                         to 1999 in most jurisdictions
                                         and prior to 2003 in Ireland
                                         are no longer subject to
                                         review as such fiscal years
                                         are generally closed.Tax
                                         authorities in various
                                         jurisdictions are in the
                                         process of reviewing the
                                         Companys income tax
                                         returns for various post-1999
                                         fiscal years, including the
                                         Internal Revenue Service (or
                                         IRS), which has recently
                                         concluded its examination of
                                         the Companys U.S. federal
                                         income tax returns for fiscal
                                         years 2002 and 2003.
                                         In connection with
                                         that examination the
                                         Company has agreed with an
                                         assessment related to
                                         intercompany transfer
                                         pricing.Such assessment
                                         resulted in additional U.S.
                                         federal and state corporation
                                         tax within previously
                                         established tax reserves and
Income Taxes                             did not have a material
                                         impact on the Companys
                      Legal Proceedings
                                              6 Months Ended
                                               Sep. 30, 2009
                                               USD / shares

Legal Proceedings [Abstract]
                                          12.Legal Proceedings
                                          (In thousands): In
                                          July 2009, the Company
                                          along with its licensing
                                          partner H. Lundbeck A/S (or
                                          Lundbeck) entered into a
                                          settlement agreement with
                                          Caraco regarding patent
                                          infringement disputes
                                          relating to Lexapro.Pursuant
                                          to the settlement, the
                                          Company and Lundbeck will
                                          provide licenses to Caraco
                                          for any patents related to
                                          Lexapro with respect to the
                                          marketing of Caraco's
                                          generic version of the
                                          product as of the date any
                                          third party generic that has
                                          properly received final
                                          approval from the FDA
                                          enters the market, other
                                          than an authorized generic
                                          or the first filer with Hatch-
                                          Waxman related
                                          exclusivity.In addition,
                                          Caraco will take over the
                                          commercialization and sale
                                          of several products from
                                          Forest's Inwood business in
                                          consideration for royalties on
Legal Proceedings                         net sales of those products
                                          and Caracos parent Sun
                   Document Information
                                             6 Months Ended
                                              Sep. 30, 2009
                                              USD / shares

Document Information [Line Items]
Document Type                             10-Q
Amendment Flag                            false
Document Period End Date                  2009-09-30
                   Entity Information (USD $)
                                                    6 Months Ended
                                                     Sep. 30, 2009

Entity Information [Line Items]
                                                FOREST LABORATORIES INC
Entity Registrant Name
Entity Central Index Key                        0000038074
Current Fiscal Year End Date                    --03-31
Entity Well-known Seasoned Issuer               Yes
Entity Voluntary Filers                         No
Entity Current Reporting Status                 Yes
Entity Filer Category                           Large Accelerated Filer
Entity Public Float
Entity Common Stock, Shares Outstanding                          301,765,815
Mar. 31, 2009




      $8,460,949,990

				
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Description: License Agreement Royalty Adjustment Interest document sample