UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549



FORM 10-Q/A
Amendment No. 1 to



Quarterly Report Pursuant To Section 13 or 15 (d) of
the Securities Exchange Act of 1934





|For quarter ended  | Commission file number 1-8593
|------------------ | -----------------------------
|September 30, 2000 |                              



Alpharma Inc.
(Exact name of registrant as specified in its charter)

|Delaware                 | 22-2095212                          
|------------------------ | ------------------------------------
|(State of Incorporation) | (I.R.S. Employer Identification No.)



One Executive Drive, Fort Lee, New Jersey

(201) 947-7774
(Registrant's Telephone Number Including Area Code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such requirements for the past 90 days.



|YES X      NO
|-------------
|             

Indicate the number of shares outstanding of each of the Registrant's classes of common stock as of November 3, 2000.



Class A Common Stock, $.20 par value - 30,685,333 shares;
Class B Common Stock, $.20 par value -  9,500,000 shares



This amendment on the Form 10-Q of Alpharma Inc. (the "Company") is being filed solely to reflect changes necessitated by the Company's revision of its audited financial statements for the years ended December 31, 1998, 1999 and 2000 and the first two quarters of 2001. Items 1, 2 and 3 of Part 1 are the only items being amended hereby, and such amendments relate only to the revised financial statements. In all other respects, this amendment presents information as of the original date of the Form 10-Q. Items not being amended are presented for the convenience of the reader only.





ALPHARMA INC.

INDEX



|                                                           | Page No.
|---------------------------------------------------------- | --------
|                                                           |         
|PART I.  FINANCIAL INFORMATION                             |         
|                                                           |         
|                                                           |         
|Item 1.  Financial Statements                              |         
|                                                           |         
|Consolidated Condensed Balance Sheet (revised) as of       |         
|September 30, 2000 and December 31, 1999                   | 3       
|                                                           |         
|Consolidated Statement of Income (revised) for the         |         
|Three and Nine Months Ended September 30,                  |         
|2000 and 1999                                              | 4       
|                                                           |         
|Consolidated Condensed Statement of Cash                   |         
|Flows (revised) for the Nine Months Ended September 30,    |         
|2000 and 1999                                              | 5       
|                                                           |         
|Notes to Consolidated Condensed Financial Statements       | 6-17    
|                                                           |         
|                                                           |         
|Item 2.  Management's Discussion and Analysis              |         
|of Financial Condition and Results of Operations           | 18-23   
|                                                           |         
|Quantitative and Qualitative Disclosures about Market Risk | 24      
|                                                           |         
|PART II.  OTHER INFORMATION                                |         
|                                                           |         
|Item 4.  Results of Votes of Security Holders              | 25      
|                                                           |         
|Item 6.Exhibits and reports on Form 8-K                    | 25      
|                                                           |         
|Signatures                                                 | 25      





ALPHARMA INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEET
(In thousands of dollars)
(Unaudited)



|                                           |                             |                 
|------------------------------------------ | --------------------------- | ----------------
|                                           | September 30,
2000(Revised) | December 31,1999
|ASSETS                                     |                             |                 
|Current assets:                            |                             |                 
|Cash and cash equivalents                  | $  95,583                   | $ 17,655        
|Accounts receivable, net                   | 240,000                     | 168,526         
|Inventories                                | 250,974                     | 167,981         
|Prepaid expenses and other                 | 20,131                      | 19,300          
|Total current assets                       | 606,688                     | 373,462         
|                                           |                             |                 
|Property, plant and equipment, net         | 324,119                     | 244,413         
|Intangible assets, net                     | 607,072                     | 488,958         
|Other assets and deferred charges          | 62,619                      | 45,023          
|Total assets                               | $1,600,498                  | $1,151,856      
|                                           |                             |                 
|LIABILITIES AND STOCKHOLDERS' EQUITY       |                             |                 
|Current liabilities:                       |                             |                 
|Current portion of long-term debt          | $50,614                     | $ 9,111         
|Short-term debt                            | 2,717                       | 4,289           
|Accounts payable and accrued expenses      | 163,514                     | 135,281         
|Accrued and deferred income taxes          | 16,698                      | 15,595          
|Total current liabilities                  | 233,543                     | 164,276         
|                                           |                             |                 
|Long-term debt:                            |                             |                 
|Senior                                     | 129,997                     | 225,110         
|Convertible subordinated notes,            |                             |                 
|including $67,850 to related party         | 371,826                     | 366,674         
|Deferred income taxes                      | 32,023                      | 35,065          
|Other non-current liabilities              | 21,646                      | 17,208          
|                                           |                             |                 
|Stockholders' equity:                      |                             |                 
|Class A Common Stock                       | 6,193                       | 4,078           
|Class B Common Stock                       | 1,900                       | 1,900           
|Additional paid-in-capital                 | 791,105                     | 297,780         
|Accumulated other comprehensive loss       | (92,988)                    | (34,201)        
|Retained earnings                          | 112,196                     | 80,150          
|Treasury stock, at cost                    | (6,943)                     | (6,184)         
|Total stockholders' equity                 | 811,463                     | 343,523         
|Total liabilities and stockholders' equity | $1,600,498                  | $1,151,856      



The accompanying notes are an integral part

of the consolidated condensed financial statements.

ALPHARMA INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF INCOME
(In thousands, except per share data)
(Unaudited)

|                                                  | Three Months EndedSeptember 30, | Nine Months EndedSeptember 30,
|------------------------------------------------- | ------------------------------- | ------------------------------
|                                                  | 2000                            | 1999(Revised)                 
|Total revenue                                     | $249,584                        | $198,199                      
|                                                  |                                 |                               
|Cost of sales                                     | 138,568                         | 106,833                       
|                                                  |                                 |                               
|Gross profit                                      | 111,016                         | 91,366                        
|                                                  |                                 |                               
|Selling, general and administrative
     expenses | 71,757                          | 64,664                        
|                                                  |                                 |                               
|Operating income                                  | 39,259                          | 26,702                        
|                                                  |                                 |                               
|Interest expense                                  | (11,324)                        | (11,257)                      
|                                                  |                                 |                               
|Other income (expense), net                       | (511)                           | (673)                         
|                                                  |                                 |                               
|Income before provision for income taxes          | 27,424                          | 14,772                        
|                                                  |                                 |                               
|Provision for income taxes                        | 8,445                           | 5,309                         
|                                                  |                                 |                               
|Net income                                        | $18,979                         | $9,463                        
|                                                  |                                 |                               
|Earnings per common share:                        |                                 |                               
|Basic                                             | $.50                            | $.34                          
|Diluted                                           | $.45                            | $.33                          
|                                                  |                                 |                               
|Dividends per common share                        | $.045                           | $.045                         
|                                                  |                                 |                               













The accompanying notes are an integral part
of the consolidated condensed financial statements.

ALPHARMA INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS
(In thousands of dollars)
(Unaudited)



|                                                       | Nine Months EndedSeptember 30,
|------------------------------------------------------ | ------------------------------
|                                                       | 2000                          
|Operating Activities:                                  |                               
|Net income                                             | $36,760                       
|Adjustments to reconcile net income to net cash        |                               
|provided by operating activities:                      |                               
|Depreciation and amortization                          | 49,758                        
|Stock option income tax benefits                       | 6,189                         
|Interest accretion on long-term debt                   | 5,207                         
|Changes in assets and liabilities, net of effects from |                               
|business acquisitions:                                 |                               
|(Increase) in accounts receivable                      | (79,610)                      
|(Increase)decrease in inventories                      | (53,854)                      
|Increase in accounts payable, accrued                  |                               
|expenses and taxes payable                             | 37,249                        
|Other, net                                             | 1,494                         
|Net cash provided by operating activities              | 3,193                         
|                                                       |                               
|Investing Activities:                                  |                               
|Capital expenditures                                   | (57,516)                      
|Loans to Ascent Pediatrics                             | (1,500)                       
|Purchase of businesses and intangible                  |                               
|assets, net of cash acquired                           | (268,711)                     
|Net cash used in investing activities                  | (327,727)                     
|                                                       |                               
|Financing Activities:                                  |                               
|Dividends paid                                         | (4,715)                       
|Proceeds from sale of convertible subordinated notes   | --                            
|Proceeds from senior long-term debt                    | 128,000                       
|Reduction of senior long-term debt                     | (206,241)                     
|Net repayments under lines of credit                   | (1,072)                       
|Payments for debt issuance costs                       | (747)                         
|Proceeds from issuance of common stock                 | 489,196                       
|Purchase of treasury stock                             | (759)                         
|Net cash provided by financing activities              | 403,662                       
|                                                       |                               
|Exchange Rate Changes:                                 |                               
|Effect of exchange rate changes on cash                | (2,913)                       
|Income tax effect of exchange rate                     |                               
|changes on intercompany advances                       | 1,713                         
|Net cash flows from exchange rate changes              | (1,200)                       
|                                                       |                               
|Increase in cash                                       | 77,928                        
|Cash and cash equivalents at beginning of year         | 17,655                        
|Cash and cash equivalents at end of period             | $95,583                       



The accompanying notes are an integral part

of the consolidated condensed financial statements.

1A.  	General



The accompanying consolidated condensed financial statements include all adjustments (consisting only of normal recurring accruals) which are, in the opinion of management, considered necessary for a fair presentation of the results for the periods presented. These financial statements should be read in conjunction with the consolidated financial statements of Alpharma Inc. and Subsidiaries included in the Company's 1999 Annual Report on Form 10-K/A. The reported results for the three and nine month periods ended September 30, 2000 are not necessarily indicative of the results to be expected for the full year.



1B.	Revision of Financial Statements



In October 2001 the Company announced that it would revise its financial statements. The revision affected the timing of recognition of revenue for certain sales of the Company's Animal Health Division for 1998, 1999, 2000 and the first two quarters of 2001. The revision results predominately from a required modification in recognizing revenue for specific customer orders in 1998, 1999 and 2000 from the time the order was segregated by third party warehouses and billed, to a subsequent period when the order was delivered.



A summary of the effects of the adjustments on the accompanying balance sheet as of September 30, 2000 and statements of income for the three and nine month periods ended September 30, 1999 follows. The revised income statements for the three and nine month periods in 2000 were previously disclosed in the Company's Form 10-Q for the quarter ended September 30, 2001.



|                           | September 30, 2000
|-------------------------- | ------------------
|                           | Reported          
|ASSETS:                    |                   
|Accounts receivable, net   | $270,250          
|Inventories                | 239,336           
|Other current assets       | 108,455           
|Current assets             | 618,041           
|                           |                   
|Non current assets         | 993,810           
|                           |                   
|Total assets               | $1,611,851        
|                           |                   
|LIABILITIES AND EQUITY:    |                   
|Current liabilities        | $233,543          
|                           |                   
|Long-term debt             | 501,823           
|Deferred taxes and other   | 53,669            
|                           |                   
|Retained earnings          | 123,549           
|Stockholders' equity       | 699,267           
|                           |                   
|Total liabilities & equity | $1,611,851        









|                                               | Three Months EndedSeptember 30, 1999 | Nine Months EndedSeptember 30, 1999
|---------------------------------------------- | ------------------------------------ | -----------------------------------
|                                               | Reported                             | Revised                            
|                                               |                                      |                                    
|Total revenue                                  | $199,829                             | $198,199                           
|Cost of sales                                  | 106,972                              | 106,833                            
|Gross profit                                   | 92,857                               | 91,366                             
|Selling, general & administrative 
   expenses | 64,664                               | 64,664                             
|Operating income                               | 28,193                               | 26,702                             
|Interest expense                               | (11,257)                             | (11,257)                           
|Other, net                                     | (673)                                | (673)                              
|Income before provision for
   income taxes    | 16,263                               | 14,772                             
|Provision for income taxes                     | 5,890                                | 5,309                              
|Net income                                     | $10,373                              | $9,463                             
|                                               |                                      |                                    
|Earnings per common share:                     |                                      |                                    
|Basic                                          | $0.38                                | $0.34                              
|Diluted                                        | $0.35                                | $0.33                              





2.	Inventories



Inventories consist of the following:





|                 | September 30,2000 | December 31,1999
|---------------- | ----------------- | ----------------
|                 |                   |                 
|Finished product | $158,528          | $101,137        
|Work-in-process  | 32,173            | 28,938          
|Raw materials    | 60,273            | 37,906          
|                 | $250,974          | $167,981        





1. Business Acquisitions



|Inventory write-up    | $1,000  | (Included in cost of sales)      
|--------------------- | ------- | ---------------------------------
|Severance of existing |         |                                  
|AHD employees         | 400     | (Included in selling, general and
|                      |         | administrative expenses)         
|Bridge financing and  |         |                                  
|advisory costs        | 4,730   | (Included in other, net)         
|                      | 6,130   |                                  
|Tax benefit           | (2,104) |                                  
|                      | $4,026  | $.09 per share-diluted           





1999



I.D. Russell:



On September 2, 1999, the Company's AHD acquired the business of I.D. Russell Company Laboratories ("IDR") for approximately $23,500 in cash (including a purchase price adjustment and other direct costs of acquisition). IDR is a US manufacturer of animal health products primarily soluble antibiotics and vitamins. The acquisition consisted of working capital, an FDA approved manufacturing facility in Colorado, product registrations, trademarks and 35 employees. The Company has allocated the purchase price to the manufacturing facility and identified intangibles and goodwill (approximately $13,000) which will be generally amortized over 15 years. The purchase agreement provides for up to $4,000 of additional purchase price if two product approvals currently pending are received in the next four years.





Isis:



Effective June 15, 1999, the Company's IPD acquired all of the capital stock of Isis Pharma GmbH and its subsidiary, Isis Puren ("Isis") from Schwarz Pharma AG for a total cash purchase price of approximately $153,000, including purchase price adjustments and direct costs of acquisition. Isis operates a generic and branded pharmaceutical business in Germany. The acquisition consisted of personnel (approximately 200 employees; 140 of whom are in the sales force) and product registrations and trademarks. No plant, property or manufacturing equipment were part of the acquisition. The Company is amortizing the acquired intangibles and goodwill based on lives which vary from 7 to 20 years (average approximately 16 years) using the straight-line method.



Jumer:



On April 16, 1999, the Company's IPD acquired the generic pharmaceutical business Jumer Laboratories SARL and related companies of the Cherqui group ("Jumer") in Paris, France for approximately $26,000, which includes the assumption of debt which was repaid subsequent to closing. Based on product approvals received, additional purchase price of approximately $2,100 may be paid in the next 2 years. The acquisition consisted of products, trademarks and registrations. The Company is amortizing the acquired intangibles and goodwill based on lives which vary from 16 to 25 years (average approximately 22 years) using the straight line method.



Pro forma Information:

The following unaudited pro forma information on results of operations assumes the purchase at the beginning of 1999 of all businesses discussed above as if the companies had been combined at such date:



|            | Proforma                        | Proforma                      
|----------- | ------------------------------- | ------------------------------
|            | Three Months EndedSeptember 30, | Nine Months EndedSeptember 30,
|            | 1999                            | 2000*                         
|            |                                 |                               
|Revenue     | $254,800                        | $710,300                      
|Net income  | $3,100                          | $29,500                       
|Basic EPS   | $0.11                           | $0.89                         
|Diluted EPS | $0.11                           | $0.86                         



*  2000 excludes actual non-recurring charges related to the Roche MFA acquisition of $4,026 after tax or $0.09 per share.



These unaudited pro forma results have been prepared for comparative purposes only and include restated amounts, where appropriate and certain adjustments, such as additional amortization expense as a result of acquired intangibles and goodwill and increased interest expense on acquisition debt. They do not purport to be indicative of the results of operations that actually would have resulted had the acquisitions occurred at the beginning of the period, or of future results of operations of the consolidated entities.









Long-term debt consists of the following:

|                                                                                                      | September 30, | December 31,
|----------------------------------------------------------------------------------------------------- | ------------- | ------------
|                                                                                                      | 2000          | 1999        
|Senior debt:                                                                                          |               |             
|U.S. Dollar Denominated:                                                                              |               |             
|1999 Credit Facility (7.70 - 8.25%)                                                                   | $105,000      | $180,000    
|Note payable - Roche (9.5%)                                                                           | 30,000        | -           
|Industrial Development Revenue Bonds                                                                  | 7,950         | 9,130       
|Other, U.S.                                                                                           | 81            | 172         
|                                                                                                      |               |             
|Denominated in Other Currencies (NOK)                                                                 | 37,580        | 44,919      
|Total senior debt                                                                                     | 180,611       | 234,221     
|                                                                                                      |               |             
|Subordinated debt:                                                                                    |               |             
|3%   Convertible Senior Subordinated Notes due
     2006 (6.875% yield), including interest accretion | 179,031       | 173,824     
|5.75% Convertible Subordinated Notes  due 2005                                                        | 124,945       | 125,000     
|5.75% Convertible Subordinated                                                                        |               |             
|Note due 2005 - Industrier Note                                                                       | 67,850        | 67,850      
|Total subordinated debt                                                                               | 371,826       | 366,674     
|                                                                                                      |               |             
|Total long-term debt                                                                                  | 552,437       | 600,895     
|Less, current maturities                                                                              | 50,614        | 9,111       
|                                                                                                      | $501,823      | $591,784    



In May 2000, the Company sold 4,950,000 shares of Class A Common Stock to an investment banker and received proceeds of approximately $185,600. The proceeds were used to repay a portion of the Bridge Financing which was arranged for the purpose of purchasing the Roche MFA business. (See note 4.)



In June 2000 the Company signed an amendment to its $300,000 1999 Credit Facility with the original consortium of banks plus the Bank of America whereby the six year term loan agreement was increased by $10,000 and the revolving credit facility was increased by $90,000. Concurrently with the completion of the Amendment the Company borrowed the necessary funds, repaid the balance of the Bridge Financing and terminated the Bridge Financing Agreement.



In August 2000, the Company sold 5,000,000 shares of Class A Common Stock to an investment banker and received proceeds of approximately $287,300. The proceeds were used to repay all outstanding revolving debt under the 1999 Credit Facility with the remainder invested in short-term money market instruments.





In July 2000, the Company's Danish subsidiary sold the patents, trademarks, marketing authorizations, and inventory related to the Elyzol Dental Gel ("EDG") product for cash proceeds of approximately $8,250. Concurrently with this sale, and due to the specialized nature of the manufacturing process for EDG, the company entered into a Toll Manufacturing agreement with the purchaser under which the Company will manufacture EDG for the purchaser for a four year period, for which it will be reimbursed direct manufacturing costs plus an agreed upon amount for overhead and a variable manufacturing profit which declines as production volumes increase. The Company also entered into a Transition Services agreement under which the Company provides regulatory and/or sales and marketing assistance to the purchaser for which it is reimbursed at agreed upon hourly rates.



As the relative fair value of the assets sold and the Company's toll manufacturing obligation cannot be reliably estimated, the Company has deferred the entire excess of the cash proceeds over the carrying amount of the assets sold and expenses associated with the sale. The deferral amounts to approximately $7,700 and will be amortized over the four year term of the Toll Manufacturing agreement on a straight line basis, which management believes will approximate amortization using the units of production method. Income from the Transition Service agreement and the contractual profit under the Toll Manufacturing agreement will be recognized as services are provided or goods are sold to the purchaser.



Approximately $480 of the deferral was recognized for the three months ended September 30, 2000. The remaining deferral of $7,220 has been deferred and $1,920 is included in accrued expenses and $5,300 is classified as other non-current liabilities.





6.	Earnings Per Share



Basic earnings per share is based upon the weighted average number of common shares outstanding. Diluted earnings per share reflect the dilutive effect of stock options and convertible debt when appropriate.



A reconciliation of weighted average shares outstanding for basic to diluted weighted average shares outstanding is as follows:



|(Shares in thousands)                | Three Months Ended | Nine Months Ended
|------------------------------------ | ------------------ | -----------------
|                                     | Sept 30,2000       | Sept 30,1999     
|                                     |                    |                  
|Average shares outstanding - basic   | 37,615             | 27,555           
|Stock options                        | 689                | 393              
|Convertible debt                     | 12,039             | 6,744            
|Average shares outstanding - diluted | 50,343             | 34,692           





The amount of dilution attributable to the stock options, determined by the treasury stock method, depends on the average market price of the Company's common stock for each period.



Subordinated notes issued in March 1998 ("05 Notes"), convertible into 6,744,481 shares of common stock at $28.59 per share, were included in the computation of diluted EPS for all periods except for the nine months ended September 30, 1999 where the result was anitdilutive.



In addition, subordinated senior notes issued in June 1999 ("06 Notes") convertible into 5,294,301 shares of common stock at $32.11 per share were included in the computation of diluted EPS for the three month period in 2000. The calculation of the assumed conversion was not included for the three and nine months periods in 1999 and the nine month period in 2000 because the result was antidilutive.



The numerator for the calculation of basic EPS is net income for all periods. The numerator for diluted EPS includes an add back for interest expense and debt cost amortization, net of income tax effects, related to the 05 and the 06 Notes when applicable.



A reconciliation of net income used for basic to diluted EPS is as follows:



|                                                      | Three Months Ended | Nine Months Ended
|----------------------------------------------------- | ------------------ | -----------------
|                                                      | Sept 30,2000       | Sept 30,1999     
|                                                      |                    |                  
|Net income - basic                                    | $18,979            | $ 9,463          
|Adjustments under if - converted method,
  net of tax | 3,750              | 1,855            
|Adjusted net income - diluted                         | $22,729            | $11,318          
|                                                      |                    |                  





7.	Supplemental Data



|                                             | Three Months Ended | Nine Months Ended
|-------------------------------------------- | ------------------ | -----------------
|                                             | Sept 30,2000       | Sept 30,1999     
|Other income (expense), net:                 |                    |                  
|Fees for bridge financing -  MFA acquisition | $--                | $--              
|Interest income                              | 1,259              | 260              
|Foreign exchange gains (losses), net         | (1,526)            | (622)            
|Amortization of debt costs                   | (540)              | (498)            
|Litigation/Insurance settlement              | -                  | -                
|Income from joint venture carried at equity  | 348                | 286              
|Other, net                                   | (52)               | (99)             
|                                             | $( 511)            | $(673)           





|Supplemental cash flow information:               
|--------------------------------------------------
|                                                  
|                                                  
|                                                  
|Cash paid for interest (net of amount capitalized)
|Cash paid for income taxes (net of refunds)       
|                                                  
|Detail of businesses and intangibles acquired:    
|Fair value of assets                              
|Seller financed debt - Roche                      
|Liabilities assumed                               
|Cash paid                                         
|Less cash acquired                                
|Net cash paid for businesses and intangibles      





8.	Reporting Comprehensive Income



SFAS 130, "Reporting Comprehensive Income" requires foreign currency translation adjustments and certain other items to be included in other comprehensive income (loss). Total comprehensive income (loss) amounted to approximately $(8,131) and $25,671 for the three months ended September 30, 2000 and 1999, respectively. Total comprehensive income (loss) amounted to approximately $(22,027) and $14,370 for the nine months ended September 30, 2000 and 1999. The only components of accumulated other comprehensive loss for the Company are foreign currency translation adjustments.





9.	Contingent Liabilities and Litigation



The Company was originally named as one of multiple defendants in 68 lawsuits alleging personal injuries and six class actions for medical monitoring resulting from the use of phentermine distributed by the Company and subsequently prescribed for use in combination with fenflurameine or dexfenfluramine manufactured and sold by other defendants (Fen-Phen Lawsuits). None of the plaintiffs have specified an amount of monetary damage. Because the Company has not manufactured, but only distributed phentermine, it has demanded defense and indemnification from the manufacturers and the insurance carriers of manufacturers from whom it has purchased the phentermine. The Company has received a partial reimbursement of litigation costs from one of the manufacturer's carriers. The Company has been dismissed in all the class actions and the plaintiffs in 59 of the lawsuits have agreed to dismiss the Company without prejudice. Based on an evaluation of the circumstances as now known, including but not solely limited to, 1) the fact that the Company did not manufacture phentermine, 2) it had a diminimus share of the phentermine market and 3) the presumption of some insurance coverage, the Company does not expect that the ultimate resolution of the current Fen-Phen lawsuits will have a material impact on the financial position or results of operations of the Company.



Bacitracin zinc, one of the Company's feed additive products has been banned from sale in the European Union (the "EU") effective July 1, 1999. While initial efforts to reverse the ban in court were unsuccessful, the Company is continuing to pursue initiatives based on scientific evidence available for the product, to limit the effects of this ban. In addition, certain other countries, not presently material to the Company's sales of bacitracin zinc have either followed the EU's ban or are considering such action and certain individual customers outside the EU may be refraining from the use of bacitracin because of the negative inferences of the ban. The existing governmental actions negatively impact the Company's business but are not material to the Company's financial position or results of operations. However, an expansion of the ban to additional countries where the Company has material sales of bacitracin based products could be material to the financial condition and results of operations of the Company.



The United Kingdom Office of Fair Trading ("OFT") is conducting an investigation into the pricing and supply of medicine by the generic industry in the United Kingdom. As part of this investigation, Cox received in February 2000 a request for information from the OFT. The request states that the OFT is particularly concerned about the sustained rise in the list price of a range of generic pharmaceuticals over the course of 1999 and is considering this matter under competition legislation. In December 1999 Cox received a request for information from the Oxford Economic Research Association ("OXERA"), an economic research company which has been commissioned by the United Kingdom Department of Health to carry out a study of the generic drug industry. The requests related to certain specified drugs. The Company has responded to both requests for information. The Company has not had any communications from either agency regarding the initial responses. Effective August 3, 2000 the government has adopted interim maximum pricing legislation. The government has indicated that it will review the interim legislation within the next 12 to 15 months based in part on the results of the OXERA activities. The Company is unable to predict what final impact the OFT investigation or OXERA activities will have on the operations of Cox and the pricing of generic pharmaceuticals in the United Kingdom.



The Company and its subsidiaries are, from time to time, involved in other litigation arising out of the ordinary course of business. It is the view of management, after consultation with counsel, that the ultimate resolution of all other pending suits should not have a material adverse effect on the consolidated financial position or results of operations of the Company.





1. Business Segment Information

The Company's reportable segments are five decentralized divisions (i.e. International Pharmaceuticals Division ("IPD"), Fine Chemicals Division ("FCD"), U.S. Pharmaceuticals Division ("USPD"), Animal Health Division ("AHD") and Aquatic Animal Health Division ("AAHD"). Each division has a president and operates in distinct business and/or geographic area. Segment data includes immaterial intersegment revenues which are eliminated in the consolidated accounts.



The operations of each segment are evaluated based on earnings before interest and taxes. Corporate expenses and certain other expenses or income not directly attributable to the segments are not allocated.



|                             | Three Months Ended September 30,
|---------------------------- | --------------------------------
|                             | 2000                            
|                             | Revenues                        
|                             |                                 
|IPD                          | $73,500                         
|USPD                         | 68,076                          
|FCD                          | 16,509                          
|AHD                          | 87,450                          
|AAHD                         | 6,622                           
|Unallocated and eliminations | (2,573)                         
|                             | $249,584                        





|                             | Nine Months Ended September 30,
|---------------------------- | -------------------------------
|                             | 2000                           
|                             | Revenues                       
|                             |                                
|IPD                          | $235,513                       
|USPD                         | 163,876                        
|FCD                          | 47,322                         
|AHD                          | 197,687                        
|AAHD                         | 12,623                         
|Unallocated and eliminations | (3,785)                        
|                             | $653,236                       



1. Revised



*  AHD 2000 operating income includes one-time charges of $1,400 related to the acquisition of Roche MFA.



At December 31, 1999 AHD identifiable assets were $190,400. Due primarily to the acquisition of Roche MFA the identifiable assets of AHD at September 30, 2000 are approximately $580,000.



1. Strategic Alliance
2. Recent Accounting Pronouncements
3. Subsequent Event



In November, 2000 two lawsuits were filed against the Company and certain of its executive officers alleging violations of securities laws and seeking to recover damages on behalf of a class consisting of those persons and entities who purchased the Company's common stock between April 1999, and October 2000. Publicly available sources indicate that one or more additional lawsuits containing similar allegations may have been filed, but the Company has not received or reviewed court documents in that regard. The Company believes it has defenses to these allegations and intends to engage in a vigorous defense.







Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations

(All amounts for prior years have been revised as set forth in Note 1B to the Condensed Financial Statements.)

Overview



In 1999, the Company made a number of acquisitions intended to enhance future growth. The International Pharmaceuticals Division ("IPD") acquired Human Pharmaceuticals businesses in Germany ("Isis") and France. The Animal Health Division ("AHD") acquired an Animal Pharmaceutical business in the United States ("ID Russell") and a technology license for Reporcin. The Aquatic Animal Health Division ("AAHD") purchased an aquatic health distribution company in the United Kingdom, ("Vetrepharm"). In 2000 the Company continued its strategy of growth and completed its largest acquisition and related financings.



·
     On May 3, 2000, the Company's AHD purchased the Medicated Feed Additive Business of Roche Ltd. ("MFA") for a cash payment of $258.0 million and the issuance of a $30.0 million promissory note to Roche. The acquisition was initially financed under a $225.0 million bridge financing agreement ("Bridge Financing") and existing credit agreements.



·
     On May 12, 2000, the Company sold 4,950,000 shares of Class A common stock and received proceeds of approximately $185.6 million which were used to repay a portion of the Bridge Financing.



·
     In June 2000, the Company signed an amendment to its 1999 Credit Facility and increased the facility by $100.0 million. Upon the completion of the amendment the Company borrowed the necessary funds and repaid and terminated the Bridge Financing.



·
     In August 2000, the Company sold 5,000,000 shares of Class A Common stock and received net proceeds of approximately $287.3 million. The proceeds were used to pay down existing line of credit and other short-term debt with the balance being invested in money market instruments.



The acquisition of the MFA, the 1999 acquisitions by IPD and AHD, and the financing required to complete the acquisitions affect most comparisons of 2000 results to 1999. The year to date results for 2000 include one-time charges incurred in the second quarter related to the MFA acquisition of $6.1 million ($4.0 million after tax or $.09 per share diluted).



The Company has integrated the operations of the 1999 acquisitions and MFA within the respective divisional operations in varying degrees. The MFA acquisition has been integrated to a greater extent because its assets, operations and personnel were immediately absorbed in existing AHD legal entities. The MFA, in particular, and to a lesser extent the other acquisitions share with their respective divisions customers, R&D efforts, supply chain activities, and administrative support and have complementary product lines and sales forces. As a result the full incremental impact of the acquisitions is impractical to segregate. The Company estimates acquisitions contributed revenues of approximately $55.0 million and $137.0 million, respectively, in the three and nine months ended September 30, 2000.







Results of Operations - Nine Months Ended September 30, 2000



Total revenue increased $142.2 million (27.8%) in the nine months ended September 30, 2000 compared to 1999. Operating income in 2000 was $94.3 million, an increase of $33.0 million, compared to 1999. Net income was $36.8 million ($1.04 per share diluted) compared to $21.7 million ($.78 per share diluted) in 1999. 2000 earnings per share are diluted by the sale of Class A Common stock in November 1999, May 2000, and August 2000. The nine month period ended September 30, 2000 results are reduced by one-time charges totaling $4.0 million after tax or $.09 per share related to the acquisition and interim financing of MFA in May 2000. Without the charges net income would have been $40.8 million ($1.13 per share diluted).



Revenues increased in the Human Pharmaceuticals business by $46.5 million and in the Animal Pharmaceuticals business by $96.7 million. The aggregate increase in revenues was reduced by over $21.0 million due to changes in exchange rates used in translating sales in foreign currencies into the U.S. Dollar, primarily in the IPD.



Changes in revenue and major components of change for each division in the nine month period ended September 30, 2000 compared to September 30, 1999 are as follows:



Revenues in IPD increased by $23.3 million due primarily to the 1999 acquisitions. Higher pricing in the U.K. was offset substantially by effects of currency translation and lower volume in certain markets. The pricing in the U.K. market was higher relative to the first half of 1999, but was lower in the third quarter 2000 compared to the third quarter of 1999. U.K. revenues grew in 1999 primarily as a result of higher pricing due in large part to conditions affecting the market which abated somewhat during the second quarter of 2000. Effective August 3, 2000 the U.K. government has adopted interim maximum pricing legislation. The government has indicated that it will review the interim legislation within the next 12 to 15 months. Market conditions resulted in certain lower prices in the second quarter of 2000 and further reductions as a result of the adoption of the above noted legislation have occurred in the third quarter of 2000. The Company's 2000 business plan anticipated the approximate effect of lower pricing.



USPD revenues increased $22.7 million due to volume increases in new and existing products offset in part by lower net pricing. Revenues in FCD increased by $.5 million due mainly to minor price increases being partially offset by translation of sales in local currency into the U.S. Dollar.



AHD revenues increased $94.1 million due to acquisitions primarily MFA. Adverse market and competitive conditions in a number of AHD's main markets caused volume and to a lesser extent price reductions in certain ongoing products. AAHD revenues increased due to new product introductions and the acquisition of Vetrepharm in November of 1999.



On a consolidated basis, gross profit increased $68.7 million and the gross margin percent increased marginally to 45.5% in 2000 compared to 44.8% in 1999.



A major portion of the dollar increase results from the acquisitions (primarily MFA and Isis). Higher pricing in the IPD's United Kingdom market and volume increases of a number of products in USPD also contributed to the increase. Partially offsetting increases were volume decreases in AHD ongoing products and certain IPD markets, lower net pricing in USPD and the effects of foreign currency translation.



In addition, AHD gross profits were reduced by a $1.0 million write-up and subsequent write-off upon sale of MFA manufactured inventory. The write-up is required by Generally Accepted Accounting Principles.



Operating expenses increased $35.7 million and represented 31.1% of revenues in 2000 compared to 32.8% in 1999. The dollar increase is attributable to the acquisitions (primarily MFA and Isis). Other increases included professional and consulting expenses for strategic planning, information technology and acquisitions, and a $.4 million charge for severance of existing AHD employees resulting from the combining of the sales forces of MFA and AHD. The percentage reduction is primarily the result of leveraging of incremental MFA sales on the existing AHD business infrastructure.



Operating income increased $33.0 million (53.9%). AHD accounted for $15.3 million of the increase due primarily to the MFA acquisition offset by weakness in base product sales in a number of markets. IPD increased $10.7 million due to higher pricing in the UK market during the first 6 months and to a lesser extent the Isis acquisition offset partially by lower volume in certain IPD markets. USPD increased $7.1 million due to increased volume offset in part by lower net pricing.



Interest expense increased in 2000 by $7.7 million due primarily to debt incurred to finance the acquisitions and to a lesser extent, higher interest rates in 2000.



Other, net was $4.4 million expense in 2000, due primarily to $4.7 million fees incurred as part of the $225.0 million MFA bridge financing and other financing fees. The bridge financing was committed, drawn, repaid and terminated in the second quarter. All fees associated with the interim financing were expensed in the second quarter.



The year-to-date estimated effective tax rate was 33.3% in 2000 compared to 36.4% in 1999. The primary reason for the lower rate is the acquisition of foreign businesses in recent years and the restructuring of ownership of legal entities in 2000 to allow for movement of funds between the international entities and maximize foreign tax efficiency.



Results of Operations - Three Months Ended September 30, 2000



Total revenue increased $51.4 million (25.9%) in the three months ended September 30, 2000 compared to 1999. Operating income in 2000 was $39.3 million, an increase of $12.6 million, compared to 1999. Net income was $19.0 million ($.45 per share diluted) compared to $9.5 million ($.33 per share diluted) in 1999. 2000 earnings per share are diluted by the sale of stock in November 1999, May 2000 and August 2000.



Revenues decreased in the Human Pharmaceuticals business by $.7 million and increased the Animal Pharmaceuticals business by $53.0 million. The aggregate increase in revenues was reduced by over $11.0 million due to changes in exchange rates used in translating sales in foreign currencies into the U.S. Dollar, primarily in the IPD.



Changes in revenue and major components of change for each division in the three month period ended September 30, 2000 compared to September 30, 1999 are as follows:



Revenues in IPD decreased by $10.6 million due primarily to the effects of currency translation and lower pricing. The pricing in the U.K. market was lower relative to the third quarter of 1999. U.K. revenues grew in 1999 primarily as a result of higher pricing due in large part to conditions temporarily affecting the market. The market has stabilized and prices have lowered due to market conditions. Effective August 3, 2000 the U.K. government has adopted interim maximum pricing legislation which caused IPD to lower prices. The government has indicated that it will review the interim legislation within the next 12 to 15 months. Further price decreases may occur in the fourth quarter of 2000 as a result of the legislation. The Company's 2000 business plan anticipated the approximate effect of lower pricing.



USPD revenues increased $8.7 million due to volume increases in new and existing products offset in part by lower net pricing. Revenues in FCD increased by $1.2 million due mainly to price and volume and offset partially by currency translation. AHD revenues increased $51.7 million due primarily to the acquisition of MFA in May 2000. Volume in other core products and markets declined due to adverse market and competitive conditions. AAHD sales increased $1.2 million due to the introduction of new vaccines and to a lesser extent to the acquisition of Vetrepharm in 1999.



On a company-wide basis, gross profit increased $19.7 million and the gross margin percent declined to 44.5% in 2000 compared to 46.1% in 1999.



A major portion of the increase in dollars results from the acquisitions (primarily MFA), and to a lesser extent increased volume in USPD. Partially offsetting increases were volume declines in certain AHD and IPD markets, the effects of foreign currency translation and by lower net pricing in USPD and AHD.



Operating expenses increased $7.1 million and represented 28.8% of revenues in 2000 compared to 32.6% in 1999. The dollar increase is mainly attributable to the acquisition of MFA. However, the lower percent to sales is also attributable to MFA due to leveraging of MFA sales on the existing AHD business infrastructure. Partially offsetting the operating expense increase was the reversal of the AHD 2000 bonus of $1.0 million accrued thru the second quarter as compared to an approximate $.7 million accrual for AHD bonuses in the third quarter of 1999.  Divisional bonuses are dependent on achieving budgeted goals for operating income and return on capital. Recent developments in AHD make it highly unlikely a bonus will be payable to AHD employees. In addition, the effects of foreign currency translation lowered expenses as reported in U.S. dollars.



On an overall basis operating income increased $12.6 million primarily due to the acquisition of MFA, increased volume in USPD, lower percentage of operating expenses in AHD and income as opposed to a loss by AAHD. Increases were reduced by lower income in IPD due mainly to the expected decrease in Cox operating income when compared to the 1999 which was impacted favorably by market conditions.



Interest expense was approximately equal to 1999 as debt incurred to finance acquisitions was substantially refinanced by equity sales in November 1999, May 2000 and August 2000.



Financial Condition



Working capital at September 30, 2000 was $373.1 million compared to $209.2 million at December 31, 1999. The current ratio was 2.60 to 1 at September 30, 2000 compared to 2.27 to 1 at year end. Long-term debt to stockholders' equity was 0.62:1 at September 30, 2000 compared to 1.72:1 at December 31, 1999.



The Company's balance sheet changed substantially as a result of the acquisition and financing of MFA in second quarter of 2000. Accounts receivable and inventory each increased at June 30, 2000 by approximately $37.0 million in the AHD. Intangible assets and property, plant and equipment increased by over $250.0 million. The acquisition was ultimately financed principally by a sale of Class A Common stock of approximately $186.0 million with the balance of the MFA acquisition financed by long-term debt. Increased accounts payable and short-term debt financed the additional working capital required by MFA.



The balance sheet improved in the third quarter as a result of the sale of Class A Common stock of approximately $288.0 million. The proceeds were used to pay off all revolving debt under the 1999 credit facility and substantially all short term debt with the balance invested in money market instruments.



At September 30, 2000, the Company had $95.6 million in cash, available short term lines of credit of approximately $42.0 million and $290.0 million available under its 1999 Credit Facility. The credit facility was amended in June of 2000 with the effect of increasing the overall amount available by $100.0 million. The credit facility has several financial covenants, including an interest coverage ratio, total debt to EBITDA ratio, and equity to total asset ratio. Interest on borrowings under the facility is at LIBOR plus a margin of between .875% and 2.0% depending on the ratio of total debt to EBITDA. As of September 30, 2000 the margin was 1.375%. The Company believes that the combination of cash from operations and funds available under existing lines of credit will be sufficient to cover its currently planned operating needs.



All balance sheet captions decreased as of September 30, 2000 compared to December 1999 in U.S. Dollars as the functional currencies of the Company's principal foreign subsidiaries, the Norwegian Krone, Danish Krone, British Pound and the Euro depreciated versus the U.S. Dollar in the nine months of 2000 by approximately 14%, 15%, 9% and 12%, respectively. The decreases do impact to some degree the above mentioned ratios. The approximate decrease due to currency translation of selected captions was: accounts receivable $8.1 million, inventories $9.5 million, accounts payable and accrued expenses $8.1 million, and total stockholders' equity $58.8 million. The $58.8 million decrease in stockholder's equity represents accumulated other comprehensive loss for the nine months ended September 30, 2000 resulting from the continued strengthening of the U.S. Dollar.



The Company has approved a number of capital projects in 2000 including the purchase and construction of a AHD plant for Reporcin, (a product and technology acquired in 1999) and a company-wide information technology project which is expected to require expenditures of over $30.0 million.



In February 1999, the Company's USPD entered into an agreement with Ascent Pediatrics, Inc. ("Ascent") under which USPD may provide up to $40.0 million in loans to Ascent to be evidenced by 71/2% convertible subordinated notes due 2005. Up to $12.0 million of the proceeds of the loans can be used only for general corporate purposes, with $28.0 million of proceeds reserved for approved projects and acquisitions intended to enhance the growth of Ascent. All potential loans are subject to Ascent meeting a number of terms and conditions at the time of each loan. The exact timing and/or ultimate amount of loans to be provided cannot be predicted. As of September 2000, $12.0 million has been advanced for general corporate purposes.



Ascent has incurred operating losses since its inception. An important element of Ascent's business plan contemplated commercial introduction of two pediatric pharmaceutical products which require FDA approval. Ascent has received FDA approval in January 2000 for one product and the other product is subject to FDA action which has delayed its commercial introduction until the fourth quarter of 2000 or later. The delay in drug introduction has resulted in Ascent continuing to incur substantial losses thru September 30, 2000. If the commercial introduction of the second product is delayed past the fourth quarter 2000, Ascent may need to raise additional funds. There is no assurance that Ascent can raise any additional funds in which case it may be required to curtail its operations. The Company is required to recognize losses, up to the amount of its loans, to the extent Ascent has accumulated losses in excess of its stockholders' equity and the indebtedness subordinate to the Company's loans. The Company is further required to assess the general collectibility of its loans to Ascent and make any appropriate reserves. The Company will continue to monitor the operations and forecasts of Ascent to consider what actions, if any, are required with respect to the Company's loans to Ascent.



An important element of the Company's long term strategy is to pursue acquisitions that in general will broaden global reach and/or augment product portfolios.	While no commitments exist, the Company is presently considering and expects to continue its pursuit of complementary acquisitions or alliances. In order to accomplish any individually significant acquisition or combination of acquisitions, the Company may use its available cash and credit lines and, if more significant, obtain additional financing in the form of equity related securities and/or borrowings. To prepare for this possibility, the Company presently has an effective shelf registration with approximately $200 million available for either debt or equity financing. In anticipation of further offerings the Company amended its Certificate of Incorporation to increase the number of authorized shares of Class A Common Stock from 50 million to 65 million in July 2000.



Recent Accounting Pronouncements



In June 1998, the Financial Accounting Standards Board (FASB) issued SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities (SFAS 133). SFAS 133 is effective for all fiscal quarters of all fiscal years beginning after June 15, 2000 (January 1, 2001 for the Company). SFAS 133 requires that all derivative instruments be recorded on the balance sheet at their fair value. Changes in the fair value of derivatives are recorded each period in current earnings or other comprehensive income, depending on whether a derivative is designated as part of a hedge transaction and, if it is, the type of hedge transaction. SFAS 133 is not expected to have a material impact on the Company's consolidated results of operations, financial position or cash flows.





Item 3. Quantitative and Qualitative Disclosures about Market Risk



Quantitative Disclosure - There has been no material changes in the Company's market risk during the nine months ended September 30, 2000.



Qualitative Disclosure - This information is set forth under the caption "Derivative Financial Instruments" included in Item 7 of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1999.



___________



Statements made in this Form 10Q, are forward-looking statements made pursuant to the safe harbor provisions of the Securities Litigation Reform Act of 1995. Such statements involve certain risks and uncertainties that could cause actual results to differ materially from those in the forward looking statements. Information on other significant potential risks and uncertainties not discussed herein may be found in the Company's filings with the Securities and Exchange Commission including its Form 10K for the year ended December 31, 1999.





PART II.    OTHER INFORMATION

Item 4.	Results of Votes of Security Holders

An Amendment to the Company's Amended and Restated Certificate of Incorporation was approved by written consent of:



|For     | 53,643,595
|------- | ----------
|Against | 244,652   
|Abstain | 352,433   

The approval increased the authorized number of shares of Class A Common Stock from 50,000,000 to 65,000,000.

Item 6.	Exhibits and Reports on Form 8-K

a)   Exhibits (electronic filing only)

3       Amendment to the Amended and Restated Certificate of Incorporation of Alpharma Inc. is filed as an exhibit to this report.

27     Financial Data Schedule

b)   Reports on Form 8-K

On October 31, 2000, the Company filed a report on Form 8-K reporting in Item 5 - the restatement of its financial statements for 1999 and the two quarters of 2000 and in Item 9 - the press release reporting third quarter earnings.







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 thereunto duly authorized.



| | Alpharma Inc.
| | -------------
| | (Registrant) 







|Date:  December 21, 2001 | /s/ Jeffrey E. Smith                               
|------------------------ | ---------------------------------------------------
|                         | Jeffrey E. Smith                                   
|                         | Vice President, Finance and Chief Financial Officer