SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): March 18, 1999
ICN PHARMACEUTICALS, INC.
(Exact name of registrant as specified in its charter)
Delaware 1-11397 33-0628076
(State or other (Commission File Number) (IRS Employer
jurisdiction of Identification Number)
Incorporation)
3300 Hyland Avenue, Costa Mesa, California 92626
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: (714) 545-0100
Not Applicable
(Former name or address, if changed since last report)
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ITEM 5: OTHER EVENTS
On February 6, 1999, the government of the Federal Republic of
Yugoslavia ("Yugoslavia") acting through the Federal Ministry of health and/or
the Ministry of Health of Serbia, seized control of the Company's 75% owned
subsidiary, ICN Yugoslavia. This action, based on a decision by the Ministry for
Economic and Property Transformation that was reached on November 26, 1998,
effectively reduced the Company's equity ownership of ICN Yugoslavia from 75% to
35%. The Ministry of Economic and Property Transformation decision was based on
the unilaterally imposed recalculation of the Company's original capital
contribution to ICN Yugoslavia. Subsequent to the seizure, the Commercial Court
of Belgrade issued an order stating that a change in control had occurred. These
actions were taken, contrary to Yugoslav law, without any notification to or
representation by the Company. Since the change of control, representatives of
the Company and ICN Yugoslavia's management have been denied access to the
premises.
The Company believes that this action was unlawful and violates the
provisions of the Foundation Agreement entered into in 1991 when ICN Yugoslavia
was formed. The Company has filed suit in the United States District Court
seeking damages as well as the return of the assets unlawfully seized by the
government of Yugoslavia.
As a result of the above-described actions, the Company recorded a
charge of $230 million in the fourth quarter of 1998, reflecting a write-off of
the Company's investment in ICN Yugoslavia and related investment.
For the year ended December 31, 1997 and the nine months ended
September 30, 1998, sales of ICN Yugoslavia were $226 million (30% of total
sales) and $126 million (20% of total sales), respectively.
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SIGNATURES
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.
ICN PHARMACEUTICALS, INC.
Date: March 18, 1999 By: /s/ David C. Watt
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David C. Watt
Executive Vice President
General Counsel and Corporate Secretary
