IMPAX Reports Record Revenues in the Fourth Quarter and the Year 2002

February 12, 2003

Files Four ANDAs in Quarter

February 12, 2003--IMPAX Laboratories, Inc. (Nasdaq NM: IPXL) today reported financial results for the three and twelve months ended December 31, 2002.

Revenues for the fourth quarter of 2002 were $8,400,000, up more than 400% compared with total revenues of $2,025,000 in the prior year's fourth quarter, and up more than 11% compared with total revenues of $7,538,000 in the third quarter of 2002. The significant year-over-year increase came on additional sales of Fludrocortisone Acetate Tablets, introduced at the end of the first quarter of 2002, Minocycline Hydrochloride Capsules launched in the third quarter of 2002, Rimantadine Hydrochloride Tablets launched in the fourth quarter of 2002, higher Lipram sales, and lower product returns.

The net loss for the 2002 fourth quarter was $3,471,000, or $(0.07) per share, compared with a net loss of $6,854,000, or $(0.15) per share in the prior year fourth quarter, which included goodwill amortization of approximately $876,000, or $(0.02) per share. Net loss narrowed due to increased sales, which partially offset increases in research and development and operating expenses. Further, results included a benefit from the reversal of the interest expense on the refundable deposit from Teva under its strategic alliance agreement, of approximately $1,595,000, or $(0.03) per share.

For the twelve months ended December 31, 2002, the Company reported total revenues of $24,515,000, up more than 370%, compared with total revenues of $6,591,000 in the previous year. The significant year-over-year increase came on the ramp up of sales of Fludrocortisone Acetate Tablets, introduced at the end of the first quarter of 2002, Minocycline Hydrochloride Capsules launched in the third quarter of 2002, Rimantadine Hydrochloride Tablets launched in the fourth quarter of 2002, Terbutaline Sulfate Tablets introduced since July 2001, higher Lipram sales, and lower product returns.

The net loss for the twelve months ended December 31, 2002, was $20,040,000, or $(0.42) per share, compared with a net loss of $25,111,000, or $(0.60) per share, in the previous year, which included goodwill amortization of $3,504,000, or $(0.08) per share. Net loss narrowed due to increased sales, which partially offset increases in research and development and operating expenses. Further, results included a benefit from the reversal of the interest expense on the refundable deposit from Teva of approximately $675,000, or $(0.01) per share.

Cash, cash equivalents and short-term investments were $20.2 million at December 31, 2002, compared with $35.5 million at December 31, 2001. The balance at December 31, 2002 included $10 million in restricted cash that serves as collateral for the $25 million revolving credit facility and term loan agreement signed with Congress Financial in October 2002.

"The fourth quarter continues our sequential quarter improvement," said Barry R. Edwards, Co-CEO. "We are looking forward to increasing sales throughout 2003, as we receive U.S. Food and Drug Administration (FDA) marketing approval for new products."

Larry Hsu, Ph.D., President, added: "We are very pleased that our development team reached the high end of our goal by filing eight applications in 2002, four of which were filed in the fourth quarter. This marks the third year in a row that we have filed eight applications. Once again, for 2003, we expect to be able to file at least six new applications with the FDA."

IMPAX has 19 applications pending at the FDA, including three tentatively approved, that address more than $5.8 billion in U.S. branded product sales for the 12 months ended September 30, 2002. Fourteen of these filings were made under Paragraph IV of the Hatch-Waxman Amendments.

IMPAX Laboratories, Inc. is a technology based specialty pharmaceutical company applying its formulation expertise and drug delivery technology to the development of controlled-release and specialty generics in addition to the development of branded products. IMPAX markets its generic products through its Global Pharmaceuticals division and intends to market its branded products through the IMPAX Pharmaceuticals division. Additionally, where strategically appropriate, IMPAX has developed marketing partnerships to fully leverage its technology platform. IMPAX Laboratories is headquartered in Hayward, California, and has a full range of capabilities in its Hayward and Philadelphia facilities. For more information, please visit the Company's Web site at: : www.impaxlabs.com.

                       IMPAX LABORATORIES, INC.
                       STATEMENTS OF OPERATIONS
                              (unaudited)
        (dollars in thousands, except share and per share data)

                            Three Months Ended    Twelve Months Ended
                                December 31,           December 31,
                                (unaudited)            (unaudited)
                               2002      2001        2002      2001

Net sales                   $ 7,998    $ 2,025     $ 23,758  $  6,591

Other revenues                  402         --          757        --

Total revenues                8,400      2,025       24,515     6,591

Cost of sales                 6,218      3,154       18,492     9,669

Gross profit (loss)           2,182     (1,129)       6,023    (3,078)

Research and development      4,355      2,907       16,254    11,890

Less: Teva reimbursements      (219)      (219)        (705)     (918)

Research and development, net 4,136      2,688       15,549    10,972

Selling expenses                835        471        2,836     2,186

General and Administrative(a) 2,203      2,594        8,396     9,258

Other operating income
 (expense), net                   3        100          (36)      164

Net loss from operations     (4,989)    (6,782)     (20,794)  (25,330)

Interest income                 104        313          644     1,148

Interest expense(b)           1,414       (385)         110      (929)

Net loss                    $(3,471)   $(6,854)    $(20,040) $(25,111)

Net loss per share
 (basic and diluted)        $ (0.07)   $ (0.15)    $  (0.42) $  (0.60)

Weighted average common
 shares outstanding      47,867,379  46,680,047  47,444,364 41,555,818

(a)Includes amortization of goodwill of $876,000 in the quarter ended
    December 31, 2001 and $3,504,000 in the twelve months ended
    December 31, 2001. There was no amortization of goodwill in 2002.

(b) The interest expense for the quarter and twelve months ended
    December 31, 2002, included the reversal of the interest on the
    refundable deposit from Teva, as follows:

                                         Q-4 2002     Year 2002
Reversal of Interest on Refundable Deposit  $ 2,190,000   $  876,000
Other Interest                                 (181,000)    (565,000)
Less: Amounts Previously Capitalized           (595,000)    (201,000)
      Total Interest Expense                $ 1,414,000   $  110,000



                       IMPAX LABORATORIES, INC.
                       CONDENSED BALANCE SHEETS
                               (in thousands)

              December 31,   December 31,
                                              2002           2001
                                           (unaudited)    (unaudited)

ASSETS

Cash, cash equivalents and short-term
 investments                                $  10,219      $  35,466

Restricted cash(a)                             10,000             --

Accounts receivable, net                        6,524          3,523

Inventory                                      10,478          3,488

Property, plant and equipment, net             37,065         24,334

Goodwill and intangibles, net                  28,337         28,721

Other assets                                    1,780          2,080

                Total assets                $ 104,403      $  97,612


LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities                         $  23,248      $   7,803

Long-term debt, net of current portion          9,105          6,868

Refundable deposit and related accrued
 interest                                      22,000         22,876

Other liabilities                               1,486            117

Mandatorily redeemable convertible
 preferred stock                                7,500          7,500

Stockholders' equity                           41,064         52,448

Total liabilities and stockholders' equity  $ 104,403      $  97,612

(a) Collateral for the $25 million revolving credit facility and term loan with Congress Financial.