SECURITIES AND EXCHANGE COMMISSION
                         WASHINGTON, D.C.  20549
                               FORM 10 - K

        Annual Report Pursuant to Section 13 or 15 (d) of
               the Securities Exchange Act of 1934

      For the fiscal year ended     Commission File No. 1-8593
     December 31, 1996
                          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    07024
          (Address  of principal executive offices)     zip code

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

Securities registered pursuant to Section 12(b) of the Act:

                                           Name of each Exchange on
      Title of each Class                       which Registered

      Class  A  Common Stock,              New  York  Stock Exchange
        $.20 par value

      Warrants  to  Purchase Shares        New  York  Stock Exchange
        of Class A Common Stock

Securities  registered pursuant to Section 12  (g)  of  the  Act:
None

Indicate  by check mark whether the Registrant (1) has filed  all
reports  to  be  filed by Section 13 or 15(d) of  the  Securities
Exchange Act of 1934 during the preceding twelve months  (or  for
such shorter period that the Registrant was required to file such
reports),  and  (2) has been subject to such filing  requirements
for the past 90 days.  YES  X    NO     .

Indicate  by  check  mark  if  disclosure  of  delinquent  filers
pursuant  to Item 405 of Regulation S-K is not contained  herein,
and will not be contained, to the best of registrant's knowledge,
in  definitive  proxy or information statements  incorporated  by
reference in Part III of this Form 10-K or any amendment to  this
Form 10-K.  (    )

The  aggregate market value of the voting stock of the Registrant
(Class  A  Common Stock, $.20 par value) as of March 1, 1997  was
$182,777,000.

The  number  of  shares outstanding of each of  the  Registrant's
classes of common stock as of March 1, 1997 was:

  Class A Common Stock, $.20 par value - 13,539,060 shares;
  Class B Common Stock, $.20 par value -  8,226,562 shares.

              DOCUMENTS INCORPORATED BY REFERENCE:

Portions of the Proxy Statement relating to the Annual Meeting of
Shareholders  to  be  held on May 28, 1997  are  incorporated  by
reference   into  Part  III  of  this  report.   Other  documents
incorporated by reference are listed in the Exhibit index.
                             PART I

Item 1.   Business

Overview

       Alpharma   Inc.   (the  "Company")  is   a   multinational
pharmaceutical company which develops, manufactures  and  markets
specialty generic and proprietary human pharmaceutical and animal
health products.

      The  Company was originally organized in 1975 as a  wholly-
owned  subsidiary of Apothekernes Laboratorium A.S,  a  Norwegian
health  care company established in 1903.  In February 1984,  the
Company's  Class  A  Common Stock was  initially  listed  on  the
American Stock Exchange through a public offering and such  stock
is  currently  listed on the New York Stock  Exchange  under  the
trading symbol "ALO".

     On October 3, 1994, the Company completed a transaction (the
"Combination  Transaction") in which  the  Company  acquired  the
pharmaceutical, bulk antibiotic, animal health and aquatic animal
health  businesses of Apothekernes Laboratorium A.S (the "Related
Norwegian  Businesses").  Immediately following the closing,  the
Company  reorganized  its business into five operating  divisions
included  in  two  business segments, Human  Pharmaceuticals  and
Animal  Health.   The Human Pharmaceuticals segment  consists  of
three    operating   divisions:   U.S.   Pharmaceuticals("USPD"),
International Pharmaceuticals("IPD") and Fine Chemicals  ("FCD").
The  Animal  Health segment consists of two operating  divisions,
Animal Health ("AHD") and Aquatic Animal Health("AAHD").

       In   order  to  accomplish  the  Combination  Transaction,
Apothekernes Laboratorium A.S changed its name to A.L. Industrier
AS  ("A.L.  Industrier")  and   demerged  the  Related  Norwegian
Businesses  into a new Norwegian corporation called  Apothekernes
Laboratorium  AS  (which  changed its name  in  January  1996  to
Alpharma  AS, hereinafter referred to as "Alpharma  Oslo").   The
Company  then  acquired  the shares of Alpharma  Oslo  through  a
tender  offer  for   $23.6  million  plus  warrants  to  purchase
3,600,000 shares of the Company's Class A Common Stock, par value
$0.20  per share (the "Warrants").  The Warrants have an exercise
price  of  $21.945  (subject to change as set forth  below),  and
expire  on January 3, 1999. Warrants to purchase 2,450,246 shares
of  Class  A  common  stock (out of the 3,600,000  total)  became
exercisable  after October 3, 1995 with the remainder  to  become
exercisable   after  October  3,  1997.  The  Company   filed   a
registration   statement   with  the  Securities   and   Exchange
Commission ("SEC"), which became effective on September 28, 1995,
concerning the Warrants and warrant shares exercisable  in  1995.
In  addition, the Company listed such Warrants and warrant shares
for  trading and quotation on the New York Stock Exchange  as  of
October 9, 1995.

      A.L.  Industrier is the beneficial owner  of  100%  of  the
outstanding shares of the Company's Class B Common Stock  and  is
able  to  control the Company through its ability to  elect  more
than  a majority of the Board of Directors and to cast a majority
of  the  votes  in any vote of the Company's stockholders.   A.L.
Industrier's  holdings  of the Company's  Class  B  Common  Stock
account  for  approximately 37.8% of the Company's  total  common
stock outstanding at December 31, 1996.

       On   February  10,  1997,  the  Company  entered  into   a
subscription  agreement with A.L. Industrier,  under  which  A.L.
Industrier  irrevocably  committed to  purchase  1,273,438  newly
issued shares of the Company's Class B Common Stock at $16.34 per
share.   The  Board of Directors of the Company also  approved  a
distribution to its Class A Common shareholders of special rights
(the "Rights") to purchase for $16.34 per share approximately one
share  of  Class A Common Stock for every six shares of  Class  A
Common Stock held by such holders. The distribution of the Rights
will  be made with a prospectus (subject to registration  of  the
rights with the SEC). Although the details of the Rights have not
been  finalized, the Rights will be transferable and will have  a
term expiring no later than November 30, 1997.  A.L. Industrier's
purchase  of the Class B Common Stock will occur upon termination
of  the Rights.  Assuming the Rights are fully exercised, the new
equity  issued pursuant to these events will maintain the current
ownership   percentages  between  the  Class  A   and   Class   B
Shareholders.

      Upon  issuance  of the Rights, the exercise  price  of  the
outstanding  Warrants  will be adjusted downward  and  amount  of
shares purchasable thereunder will be adjusted upward pursuant to
the governing warrant agreement.

      Statements  in  this  Report on Form  10-K  which  are  not
historical facts, so-called "forward looking statements" are made
pursuant  to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995.  Investors are cautioned that  all
forward-looking  statements  involve  risks  and   uncertainties,
including  those  detailed in the narrative  description  of  the
Company's  business set forth below and in "Item 7.  Management's
Discussion  and  Analysis of Financial Condition and  Results  of
Operations".
Financial Information About Industry Segments

       The   Company's  two  business  segments  are  (1)   Human
Pharmaceuticals and (2) Animal Health. The Company's segments and
their  operating divisions contributed the following  percentages
of revenues.
                                 1996     1995      1994

       USPD                       31%      33%       37%
       IPD                        29%      28%       26%
       FCD                         7%       8%        7%
       Human Pharmaceuticals      67%      69%       70%
       Animal Health *            33%      31%       30%

          Total Revenues         100%     100%      100%
       *  Predominantly sales of AHD.

       For   additional  financial  information  concerning   the
Company's  business  segments see Note 20 of  the  Notes  to  the
Consolidated  Financial Statements included in  Item  8  of  this
Report.

Narrative Description of Business

Human Pharmaceuticals

      The human pharmaceuticals segment is comprised of three  of
the five operating divisions of the Company, namely the USPD, IPD
and FCD.

           U.S. Pharmaceuticals Division (the "USPD")

      The  USPD  develops,  manufactures  and  markets  specialty
generic  human  pharmaceuticals in  the  U.S.   The  division  is
managed  by  a single senior management team and is comprised  of
three  wholly-owned  subsidiaries:  Alpharma  USPD  Inc.  ("AUI";
formerly  called  Barre-National, Inc.), NMC  Laboratories,  Inc.
("NMC")  and ParMed Pharmaceuticals, Inc. ("ParMed").  In  August
1996, the USPD sold the tablet business of its Able Laboratories,
Inc.  ("Able")  subsidiary  (including its  leased  manufacturing
facility  in South Plainfield, New Jersey) to an unrelated  third
party and moved production of Able's line of suppository products
to its facility in Lincolnton, North Carolina.

       AUI,  acquired  in  October  1987,  is  the  leading  U.S.
manufacturer  of  liquid  generic  pharmaceutical  and  over-the-
counter  ("OTC") products.  NMC, acquired in August  1990,  is  a
specialized  manufacturer of pharmaceutical creams and  ointments
for  topical  use.  ParMed, acquired in May, 1986, distributes  a
line  of  over  1,600 generic prescription and OTC pharmaceutical
product  presentations (including those manufactured by  USPD  as
well  as  those  of third parties) primarily to U.S.  independent
retail   pharmacies.  They  also  provide,  under   the   "Impact
Marketing"  name,  certain  custom marketing  services  (such  as
telemarketing,   order  processing  and  distribution)   to   the
pharmaceutical and certain other industries.

      In  March 1993, AUI acquired a pharmaceutical manufacturing
facility  in Lincolnton, North Carolina ("Lincolnton")  including
inventories, Abbreviated New Drug Applications ("ANDA") and other
related  assets.  The facility is designed to manufacture topical
creams  and  ointments  and  suppositories.   The  facility   was
expanded  in 1994 and the USPD expects this facility to grow  and
become  more  efficient  as it realigns  production  capacity  in
accordance  with  the accelerated production  consolidation  plan
announced in May 1996.  Such plan includes the discontinuation of
all  activities in its facilities in Glendale, New York and South
Plainfield,  New  Jersey  and  the  transfer  of  production   to
Lincolnton.  The move is expected to be complete by mid-1997  and
requires FDA approval for each ANDA transferred.

      Generic  pharmaceuticals are the chemical  and  therapeutic
equivalents   of   brand-name  drugs.  Although  typically   less
expensive,  they  are  required to  meet  the  same  governmental
standards as brand-name drugs and must receive approval from  the
U.S.  Food  and Drug Administration ("FDA") prior to  manufacture
and  sale.   Generic  pharmaceuticals  may  be  manufactured  and
marketed only if relevant patents (and any additional government-
mandated  market  exclusivity  periods)  have  expired.   Generic
pharmaceutical sales have increased in recent years, due in  part
to  several  factors including: (i) state laws permitting  and/or
mandating substitution of generics by pharmacists; (ii)  pressure
from  managed  care  and  third party payors  to  encourage  cost
containment  by  health  care  providers  and  consumers;   (iii)
increased  acceptance of generic drugs by physicians, pharmacists
and  consumers;  and  (iv)  the  increasing  number  of  formerly
patented   drugs  which  have  become  available  to   off-patent
competition.

     The  USPD  (excluding  its  ParMed  operation)  manufactures
and/or  markets approximately 175 generic products, primarily  in
liquid,  cream,  ointment  and  suppository  dosage  forms.  Each
product  represents a different formulation or  chemical  entity.
Products  are  sold in over 300 product presentations  under  the
"Alpharma",   "Barre"  or  "NMC"  labels  and   private   labels.
Prescription products are sold by a divisional sales  force.  OTC
products  are sold by the divisional sales force as  well  as  by
certain independent sales representatives.

     Liquid  Pharmaceuticals:  The  USPD  is  the  leading   U.S.
     manufacturer  of generic pharmaceutical products  in  liquid
     form   with  approximately  110  products.   Most   of   the
     division's  liquid products are manufactured in its  268,000
     square foot facility in Baltimore, Maryland. The  experience
     and  technical know-how of the USPD enables it to  formulate
     therapeutic equivalent drugs in liquid forms and  to  refine
     product  characteristics such as taste, texture,  appearance
     and fragrance.

     Because  of  the  importance to the USPD of cough  and  cold
     remedies,  this  business is seasonal in nature.   A  higher
     percentage  of sales are made in the winter months  and  are
     affected,  from  year  to year, by the incidence  of  colds,
     respiratory  diseases  and  influenza  in  its  geographical
     market.

     In  1996,   the  USPD  received approval  from  the  FDA  to
     manufacture and market Minoxidil Topical Solution 2%.

     Creams,   Lotions  and  Ointments:   The  USPD  manufactures
     approximately  50  cream, lotion and ointment  products  for
     topical  use.   Most of these creams, lotions and  ointments
     are  prescription products and include antibacterial,  anti-
     inflammatory   and  combination  products.   As   previously
     mentioned herein, the USPD is in the process of transferring
     all  cream,  lotion and ointment manufacturing to Lincolnton
     and will close its NMC facility in Glendale, New York in the
     first quarter of 1997.

     In  1996,  the  USPD  received  approval  from  the  FDA  to
     manufacture and market Miconazole Nitrate Vaginal Cream 2%.

     Suppositories and Other Specialty Generic Products: The USPD
     also  manufactures  five suppository  products  and  markets
     certain   other   specialty  generic   products,   including
     Epinephrine Mist and a Home Pregnancy Test Kit.

      The  generic pharmaceutical industry is highly competitive,
with  competition from companies specializing in generic products
as  well  as  generic divisions of major international  innovator
companies. Consequently, profit margins on generic drug  products
tend  to  be  reduced  as more competitors obtain  the  necessary
approvals to manufacture and sell such products from the FDA.  In
addition,   brand-name  competitors  often  try  to  prevent   or
discourage  the use of generic equivalents through marketing  and
regulatory    activities   and   litigation.    Some   brand-name
competitors  also have introduced generic versions of  their  own
branded  products  prior to expiration of the  patents  for  such
drugs,  which  may  result in a greater market  share  for  these
companies following expiration of the applicable patents.

       The   USPD   has   historically  sold  its   products   to
pharmaceutical wholesalers, distributors, mass merchandising  and
retail  chains, grocery stores, and to a lesser extent, hospitals
and  managed care providers.  However, in 1996, the U.S.  generic
pharmaceutical  industry  experienced  a  fundamental  shift   in
distribution, purchasing and stocking patterns which resulted  in
accelerated  price  erosion  and  significant  volume  swings  as
inventories were adjusted.   Programs initiated by U.S.  national
wholesalers fueled the trend of lower prices as they reduced  the
market share of private label pharmaceutical distributors,  which
were an important (but declining) part of the USPD customer base.
The  overall  trend  of  aggressive  trade  inventory  reductions
continued and resulted in lower levels of stocking in advance  of
the  cough and cold season.  As a direct result of these industry
trends, the USPD experienced lower sales volume and lower pricing
compared  to  1995. The Company cannot predict when pricing  will
stabilize  or when the negative effects of this shift may  cease.
In  addition  to  the decline in market share  of  pharmaceutical
distributors  as  set forth above, there is a  general  trend  of
consolidation   within  the  customer  base  for   pharmaceutical
products  in the U.S.   At present, the USPD is not dependent  on
any  one  customer.   However,  if consolidation  continues,  the
division  could become more dependent on individual customers  as
certain customers increase their size and market share.
     
      USPD's  principal focus in its product development strategy
is  to  obtain FDA approval to market equivalent formulations  of
drugs  through  the ANDA process. The Company has  been  impacted
from  time to time by delays in the receipt of approvals for  new
products and supplemental approvals for certain existing products
from   the  FDA.   The  Company  cannot  predict  whether  future
legislative  or  regulatory developments might  have  an  adverse
effect on the Company.


              International Pharmaceuticals Division ("IPD")

      The IPD develops, manufactures and markets a broad range of
generic  and  specialty  dosage-form human pharmaceuticals,  oral
health care products, adhesive bandages and surgical tapes  under
proprietary  brands  primarily in the Nordic  and  other  Western
European  countries,  Indonesia and the Middle East. The division
is  managed  by a single senior management team and  business  is
primarily conducted through two wholly-owned subsidiaries, Dumex-
Alpharma  A/S of Copenhagen, Denmark ("Dumex") and Alpharma  Oslo
and  their respective subsidiaries. The IPD conducts its business
primarily  in Scandinavian and U.S. Dollar denominated currencies
(or currencies which generally fluctuate with the U.S. Dollar).

     Dosage-Form   Pharmaceuticals:  The  IPD  manufactures   and
     markets  a  broad range of dosage-forms, including  tablets,
     ointments,  creams,  and liquid and injectable  preparations
     for  many  different  therapies  with  a  concentration   on
     prescription drug antibiotics, analgesics/antirheumatics and
     psychotropics,  over-the-counter skin care, gastrointestinal
     and analgesic products.

     The  principal  geographical markets for IPD's  dosage  form
     pharmaceutical  products are the Nordic  and  other  Western
     European countries as well as Indonesia and the Middle East.
     IPD  manufactures such products at its facilities  in  Lier,
     Norway, Copenhagen, Denmark and Jakarta, Indonesia.
     
     In  May  1996, the Company's Board of Directors  approved  a
     production rationalization plan which includes the  transfer
     of   all   tablet,  ointment  and  liquid  production   from
     Copenhagen to Lier and transfer of all sterile production to
     the   Copenhagen  facility.   The  full  transfer  will   be
     completed in 1998. The facility at Lier was designed with  a
     view  towards  meeting  the FDA's CGMP  standard.   However,
     given that the facility's current production is not exported
     to  the  U.S., the Company has not initiated the process  to
     cause  the  facility  to  be in compliance  with  the  FDA's
     interpretation of CGMP.

     The  IPD employs a specialized sales force which markets and
     promotes   dosage-form  products  to   doctors,   hospitals,
     pharmacies and consumers.  In each of its markets,  the  IPD
     uses wholesalers to distribute its pharmaceutical products.

     The  pharmaceutical business is highly competitive, and many
     of  IPD's  competitors  are substantially  larger  and  have
     greater  financial, technical and marketing  resources  than
     the  IPD.  Most of the IPD's pharmaceutical products compete
     with  one or more products of other companies which  contain
     the same active ingredient.

     The   development,   manufacture  and   marketing   of   IPD
     pharmaceutical   products   is  subject   to   comprehensive
     government regulation both in Norway, Denmark and  in  other
     countries  where the products are manufactured and marketed.
     Government  regulation includes detailed inspection  of  and
     controls  over  manufacturing and quality control  practices
     and  procedures, requires approvals to market  products  and
     can  result in the recall of products and the suspension  of
     production.   Such   government   regulation   substantially
     increases  the  cost  of producing pharmaceutical  products.
     Regulatory   approvals   are   required   before   any   new
     prescription or over-the-counter drug can be marketed.

     In Norway and Denmark, the IPD's pharmaceutical products are
     beginning to encounter price pressures from parallel imports
     (i.e.  imports  of  identical  products  from  lower  priced
     markets under the European Union free trade clause). The IPD
     believes  that it is likely that parallel imports may  be  a
     developing trend in other markets in which the IPD sells its
     dosage-form  pharmaceuticals. Such  parallel  imports  could
     lead  to lower volume growth and downward pressure on prices
     in certain product and market areas.

     In  the Nordic countries in recent years, there has been  an
     increase  in  volume  of  sales of  generic  pharmaceuticals
     relative  to  original  pharmaceuticals.  This  increase  in
     market share is primarily a result of government initiatives
     to  reduce  pharmaceutical expenses through new  regulations
     which  promoted generic pharmaceuticals in lieu of  original
     formulations. However, the increased focus on the regulation
     of  pharmaceutical prices may lead to increased  competition
     and   price   pressure  for  suppliers  of  all   types   of
     pharmaceuticals.

     The  pharmaceutical business of the IPD also  includes  oral
     health  care  products.  The two primary  oral  health  care
     products  are  Elyzol  Dental  Gel  for  the  treatment   of
     periodontal disease and Flux sodium fluoride tablets.

     In 1996 significant expenses continued to be incurred for an
     administrative,  selling  and  marketing  infrastructure  to
     promote  Elyzol Dental Gel and for continuing  research  and
     development  work, including work done with  regard  to  the
     Company's project to conduct clinical trials as part of  the
     new drug approval process in the U.S. for Elyzol Dental Gel.
     At  present, the Company is in the process of clarifying the
     FDA's  current  guidelines for the next  phase  of  clinical
     trials  for  such product.  Additionally, IPD management  is
     continuing to explore alternative marketing arrangements for
     the  product  which may include licensing  and/or  obtaining
     marketing  partners  in  certain  geographical  areas.   The
     Company considers the Elyzol Dental Gel product to be in the
     developmental phase.

     Adhesive  Bandages and Surgical Tapes:  The IPD manufactures
     adhesive  bandages,  surgical tapes  and  non-medical  tapes
     under  its proprietary Norgesplaster brand, and is the  only
     manufacturer of adhesive bandages and surgical tapes in  the
     Nordic  countries.  Its most significant market  is  Norway,
     where  it  is  the leading supplier in the industry.   These
     products  are  sold  to  consumers  and  hospitals   through
     pharmacies  and other retail outlets.  The IPD's  production
     facility  is located at Vennesla, Norway, which  is  320  km
     southwest of Oslo.

                      Fine Chemicals Division ("FCD")

      The FCD develops, manufactures and markets bulk antibiotics
to  the  pharmaceutical industry worldwide and is  managed  by  a
single senior management team.  Business is conducted through the
Company and its Alpharma Oslo and Dumex subsidiaries.

      The products of the FCD constitute the active substances in
a  large  number of finished pharmaceuticals, including  finished
pharmaceuticals  for  the  treatment  of  certain  skin,  throat,
intestinal  and systemic infections. Bacitracin, Zinc  Bacitracin
and  Polymyxin  are the most significant products  for  the  FCD,
which  believes  it  is  the  world's  largest  manufacturer  and
supplier of such products.  The division also manufactures  other
antibiotics  such as Vancomycin, Amphotericin B and Colistin  for
use  systemically and in specialized topical and  surgical  human
applications.    In  addition,  the  FCD  markets   other   well-
established bulk antibiotics, such as Gramicidin and Tyrothricin,
which  are  contract manufactured for the division  by  a  Danish
company.

      The  FCD  manufactures its products in its plants in  Oslo,
Norway    and   Copenhagen,   Denmark.    Both   plants   include
fermentation,  specialized recovery and  purification  equipment.
Both  facilities have been approved as a manufacturer of  sterile
and  non-sterile bulk antibiotics by the FDA and  by  the  health
authorities  of  European countries.  The manufacturing  methods,
quality control procedures and quality assurance systems for  the
production   of   such  antibiotics  are  subject   to   periodic
inspections by regulatory agencies.


Animal Health

      Since  the  completion  of the Combination  Transaction  on
October 3, 1994,  the Animal Health segment is comprised  of  two
operating divisions of the Company, namely the AHD and the AAHD.

                         Animal Health Division ("AHD")

      The  AHD  develops, manufactures and markets feed additives
and animal health products for animals raised for commercial food
production worldwide and is managed by a single senior management
team.   Business  is  primarily conducted  through  the  Company,
Alpharma Oslo and Wade Jones Company, Inc., a major U.S.  poultry
health  products  distributor acquired in  July  1994.   The  AHD
restructured its operations in 1996 to better align its  services
with  customer needs.  The restructuring resulted in a  reduction
of  approximately  10% of its workforce.  The  AHD  believes  its
streamlined organization will be better able to adapt to the ever-
changing animal health market place.

      The   AHD's principal animal health product is BMD, a  feed
additive, which is used to promote growth and feed efficiency and
prevent  or  treat diseases in poultry and swine.  The  AHD  also
manufactures and markets a feed additive for poultry,  swine  and
calves under the Albac trademark.  In 1991, the Company purchased
two animal health lines which are commonly used in combination or
sequentially with BMD. These products include 3-Nitro, Histostat,
Zoamix,  Mycostatin, and chlortetracycline ("CTC"), a feed  grade
antibiotic. The AHD also manufactures and sells Vitamin  D3,  and
other  feed  additives  which are used  for  poultry  and  swine.
Commencing in 1994, the AHD also marketed and sold Merck  AgVet's
(a division of Merck & Co., Inc.) line of poultry products in the
U.S.   However,  the AHD and Merck mutually agreed  to  terminate
this  relationship  effective June 30, 1996  as  Merck  sold  its
poultry products line to an unrelated third party.

      The  AHD  produces  BMD  at its Chicago  Heights,  Illinois
facility,  which  includes  a modern  fermentation  and  recovery
plant.   During  recent  years, the  Chicago  Heights  facility's
capacity  has increased and it has operated at or near  capacity.
In   the   Combination  Transaction  the  Company  acquired   the
technology  to manufacture BMD which it previously licensed  from
A.L. Industrier.

      The  Albac product is manufactured at the division's Skoyen
facility  in Norway. The 3-Nitro product line is manufactured  in
accordance with a ten year agreement using AHD technology  at  an
unrelated company's facility.  The contract requires the  AHD  to
purchase minimum yearly quantities on a cost plus basis.  CTC  is
purchased   primarily   from  foreign   suppliers   and   blended
domestically.

     The AHD presently sells a major portion of its volume in the
U.S.  However, with the opening of sales offices in Canada, Latin
America,  and the Far East, coupled with the international  scope
of  the  animal  health  business  acquired  in  the  Combination
Transaction,   the  AHD  has  increased  its  manufacturing   and
marketing capabilities outside the U.S. and expects international
sales to increase in the future.

     Sales of the AHD's products in the U.S., Canada and Mexico
are made principally to commercial feed manufacturers and
integrated swine and poultry producers through a staff of
technically trained sales and technical service personnel located
throughout the country.   Sales of the AHD's products outside
North America are made primarily through the use of distributors
and sales companies. Although the AHD is not dependent on any one
customer, the customer base for animal health products is in a
consolidation phase.  Therefore, as consolidation continues, the
AHD could become more dependent on certain individual customers
as such customers increase their size and market share.

      Because  most  of  AHD's products are feed  additives,  the
division's sales of such products may be affected by the price of
feed  grain.   In  1996,  the Company's results  were  negatively
impacted  by  record  increases in U.S. grain  (corn  and  wheat)
prices.  These high prices resulted in a reduction in the use  of
feed   additives  in  general  and  intense  price   competition.
Although  prices have decreased from their 1996 peak levels,  the
Company   cannot   predict  whether  future  feed   grain   price
developments might have an adverse effect on the Company.

      The  animal  health  industry  is  highly  competitive  and
includes  a  large  number of companies with  greater  financial,
technical  and  marketing  resources  than  the  Company.   These
companies offer a wide range of products with various therapeutic
and  growth stimulating qualities.  Competition is also  affected
by the issuance of  regulatory approvals for similar or competing
products  (particularly  in the U.S.)  and  the  availability  of
generic versions of certain products.   The Company believes that
its  competitive position in the animal health business has  been
enhanced  because  BMD  and Albac are not  absorbed  into  animal
tissues.   The FDA does not require BMD and Albac to be withdrawn
from  feed  prior to the marketing of the food animals.   Certain
tests  have also shown that BMD and Albac do not tend to  produce
resistance  in  bacteria  which  is  a  characteristic  of   some
competitive products.

                                
                  Aquatic Animal Health Division ("AAHD")

     The AAHD develops, manufactures and markets vaccines for use
in  immunizing  farmed  fish against disease.   The  division  is
managed  by  a  single  senior management team  and  business  is
conducted  through two wholly-owned subsidiaries,  Alpharma  Oslo
and  Alpharma  NW Inc. ("NW") which was acquired  in  July  1989.
Presently, the AAHD is the leading supplier of vaccines for  farm
raised salmon in Norway, which is the largest market in the world
for  the  farming of salmon. In 1996, approximately  55%  of  the
revenues of the AAHD were generated from the Norwegian market.

      The  AAHD  maintains two manufacturing locations, Bellevue,
Washington  and  Overhalla, Norway.  The Overhalla  facility  was
purchased by the AAHD in November 1994 and a new production  unit
within  such facility was completed in 1996 so that it is capable
of  manufacturing  aquaculture products using state  of  the  art
technology.   The  facility is also used to manufacture  ringworm
vaccines for cattle and listeriosis vaccines for sheep and goats.

      Competition  in  the  aquatic  animal  health  industry  is
characterized  by  relatively  few  competitors.   However,   the
industry is subject to rapid technological change.  As a  result,
new  techniques and products developed by competitors could cause
the  AAHD products to become obsolete if the division was  unable
to match technological improvements.

Research, Product Development and Technical Activities

     Scientific development is important to each of the Company's
business  segments.  The Company's research, product  development
and  technical  activities in the Human  Pharmaceuticals  segment
within   the  U.S.,  Norway  and  Denmark  concentrate   on   the
development   of  generic  equivalents  of  established   branded
products  as well as discovering creative uses of existing  drugs
for  new treatments and on compiling the necessary data to obtain
government   approvals.    The   Company's   research,    product
development  and  technical activities also focus  on  developing
proprietary  drug  delivery  systems and  on  improving  existing
delivery  systems,  fermentation  technology  and  packaging  and
manufacturing techniques.  In view of the substantial funds which
are  generally required to develop new chemical drug entities the
Company  has  not  emphasized  such  activities.   The  Company's
technical  development activities for the Animal  Health  segment
involve extensive product development and testing for the primary
purpose  of  establishing clinical support for new  products  and
additional  uses  for  or  variations of  existing  products  and
seeking related FDA and analogous governmental approvals.

      Generally,  research and development  are  conducted  on  a
divisional  basis.   The Company conducts its  technical  product
development activities at its facilities in Copenhagen,  Denmark,
Oslo,  Norway,  Baltimore,  Maryland,  Bellevue,  Washington  and
Chicago   Heights,  Illinois,  as  well  as  through  independent
research facilities in the U.S.

      Research and development expenses were approximately  $34.3
million, $32.8 million, and $32.5 million in 1996, 1995 and 1994,
respectively.

Financial  Information About Foreign and Domestic Operations  and
Export Sales

      The  Company derives a substantial portion of its  revenues
and  operating income from its foreign operations. Revenues  from
foreign  operations  accounted for  over  45%  of  the  Company's
revenues  in  1996. For certain financial information  concerning
foreign and domestic operations see Note 20 of the Notes  to  the
Consolidated  Financial Statements included in  Item  8  of  this
Report.    Export  sales  from  domestic  operations   were   not
significant.

      The  Company's  foreign operations are subject  to  various
risks which are not present in domestic operations, including, in
certain    countries,   currency   exchange   fluctuations    and
restrictions, restrictions on imports, government price controls,
restrictions  on the level of remittance of dividends,  interest,
royalties and other payments, the need for governmental  approval
of  new  operations, the continuation of existing operations  and
other  corporate actions, political instability, the  possibility
of  expropriation  and  uncertainty as to the  enforceability  of
commercial rights, trademarks and other proprietary rights.

Regulation; Proprietary Rights

      The  research, development, manufacturing and marketing  of
the  Company's  products are subject to comprehensive  government
regulation  by the FDA in the U.S., and by comparable authorities
in   Norway,  Denmark, Indonesia and other countries.  Government
regulation  includes  detailed inspection of  and  controls  over
testing, manufacturing, safety, labeling, storage, recordkeeping,
approval,  advertising,  promotion,  sale  and  distribution   of
pharmaceutical    products.   Noncompliance    with    applicable
requirements can result in fines, recall or seizure of  products,
total  or  partial suspension of production and/or  distribution,
refusal  of  the government to approve new products and  criminal
prosecution.  Such government regulation substantially  increases
the  cost  of  producing human pharmaceutical and  animal  health
products.

     FDA approval is required before any new prescription or over-
the-counter  drug  products  or any animal  health  drug  can  be
marketed  in  the  U.S. All applications for  FDA  approval  must
contain data relating to bioequivalency, product formulation, raw
material suppliers, stability, manufacturing, packaging, labeling
and  quality  control. Validation of manufacturing processes  are
also  required before a company can market new products  and  the
FDA   conducts   pre-and  post-approval  reviews   and   facility
inspections  to implement these rules. Supplemental  filings  for
approval  to  transfer  products from one manufacturing  site  to
another  also require review.  Analogous governmental and  agency
approvals  are  similarly required in other countries  where  the
Company  conducts  business.   These  government  approvals   are
therefore  very  important to both the Human Pharmaceuticals  and
Animal Health segments.

      The Company's manufacturing operations (in the U.S. as well
as  two  of  the  Company's European facilities that  manufacture
products  for  export to the U.S.) are required  to  comply  with
Current  Good Manufacturing Practices ("CGMP") as interpreted  by
the  FDA  and,  in  countries  outside  the  U.S.,  with  similar
regulations.  This  concept  encompasses  all  aspects   of   the
production process, including validation and record keeping,  and
involves   changing   and   evolving   standards.   Consequently,
continuing  compliance with CGMP is a particularly difficult  and
expensive part of regulatory compliance, especially since the FDA
and  certain other analogous governmental agencies have increased
the number of regular inspections to determine compliance.  As  a
result  of  actions  taken  by the  Company  to  respond  to  the
progressively more demanding regulatory environment in  which  it
operates, the operating income of the USPD's operations has  been
particularly affected as the Company has spent, and will continue
to spend, significant funds and management time on FDA compliance
matters.  In  this  regard,  in 1992,  AUI  concluded  a  binding
agreement  in  the form of a consent decree with  the  FDA  which
clarified  AUI's  regulatory obligations (the "Consent  Decree").
The  Consent  Decree defines the standards AUI  must  achieve  in
meeting  CGMP.  USPD's  Able operation  also  signed  an  amended
consent  decree  with FDA governing manufacturing  operations  in
accordance  with  CGMP. Additionally, the  Company  is  currently
responding to a Warning Letter issued by the FDA regarding  FDA's
latest  inspection of bulk antibiotic production at  its  Skoyen,
Norway plant.

      The evolving and complex nature of regulatory requirements,
the  broad  authority  and discretion of the  FDA  and  analogous
foreign  agencies,  and the generally  high level  of  regulatory
oversight results in a continuing possibility that from  time  to
time the Company will be adversely affected by regulatory actions
despite  its  ongoing  efforts  and  commitment  to  achieve  and
maintain full compliance with all regulatory requirements.

      Continuing  studies of the proper utilization, safety,  and
efficacy  of  pharmaceuticals and other health care products  are
being  conducted  by  industry, government agencies  and  others.
Such studies, which increasingly employ sophisticated methods and
techniques,  can call into question the utilization,  safety  and
efficacy  of previously marketed products and in some cases  have
resulted, and may in the future result, in the discontinuance  of
their  marketing and, in certain countries, give rise  to  claims
for damages from persons who believe they have been injured as  a
result of their use.

      The  Waxman-Hatch  Act  of 1984  ("WH  Act")  extended  the
abbreviated application procedure for obtaining FDA approval  for
generic  forms of brand-name pharmaceuticals originally  marketed
before 1962 which are off-patent or whose market exclusivity  has
expired.   The WH Act also provides market exclusivity provisions
which  could preclude the submission or delay the approval  of  a
competing  ANDA.   One such provision allows a five  year  market
exclusivity  period for New Drug Applications  ("NDA")  involving
new chemical compounds and a three year market exclusivity period
for NDA's containing new clinical investigations essential to the
approval  of such application.  The market exclusivity provisions
apply   equally  to  patented  and  non-patented  drug  products.
Another  provision may extend patents for up  to  five  years  as
compensation for reduction of the effective life of the patent as
a  result of time spent by the FDA reviewing an application for a
drug.  Patents may also be extended pursuant to the terms of  the
Uruguay  Round Agreements Act ("URAA").   Therefore, the  Company
cannot  predict  the extent to which the WH  Act  or  URAA  could
postpone launch of some of its new products.

      The  Generic  Drug  Enforcement  Act  of  1992  establishes
penalties  for  wrongdoing in connection with the development  or
submission  of  an ANDA by authorizing the FDA to permanently  or
temporarily  debar  companies or individuals from  submitting  or
assisting  in the submission of an ANDA, and to temporarily  deny
approval  and suspend applications to market generic drugs.   The
FDA  may  also suspend the distribution of all drugs approved  or
developed  in  connection  with certain wrongful  conduct  and/or
withdraw approval of an ANDA and seek civil penalties.   The  FDA
can  also  significantly delay the approval of any  pending  ANDA
under  the  "Fraud, Untrue Statements of Material Facts,  Bribery
and Illegal Gratuities Policy".

      The  methods  of reimbursement and fixing of  reimbursement
levels  under Medicare, Medicaid and other reimbursement programs
are  under active review by state and federal government as  well
as   by  private  third  party  payors.   In  addition,  Medicaid
legislation requires that all pharmaceutical manufactures  rebate
to  individual states a percentage of their revenues arising from
Medicaid-reimbursed  pharmaceutical sales.  The  required  rebate
for generic manufacturers is currently 11%.  The Company believes
that  the federal and/or state governments may continue to review
and  assess alternative payment methodologies and reform measures
aimed  at reducing the cost of drugs to the public.  Due  to  the
uncertainties  regarding  the ultimate features  of  such  reform
initiatives,  the Company cannot predict which, if any,  of  such
measures  will  be  adopted, when they will be  adopted  or  what
impact they may have on the Company.

      In  many  countries  in  which the Company  does  business,
including some of the Scandinavian countries, the initial  prices
of  pharmaceutical preparations for human use are dependent  upon
governmental    approval   or   clearance   under    governmental
reimbursement  schemes  usually  based  on  costs  or  prices  of
comparable  products and subsequent price increases may  also  be
regulated.  In past years, as part of overall programs  to  lower
health  care costs, certain European governments have not allowed
price  increases  and have introduced various  systems  to  lower
prices.  As a result, cost increases and/or lower revenues due to
exchange rate fluctuations have not been recovered.


Environmental Matters

      The Company believes that it is substantially in compliance
with all presently applicable federal, state and local provisions
regulating  the  discharge of materials into the environment,  or
otherwise relating to the protection of the environment.   During
1995,  the Company's AUI subsidiary received and responded  to  a
Notice  of Potential Liability and Request for Information  on  a
site owned by Ramp Industries, an unaffiliated third party.   AUI
historically made one small shipment to the site and no  material
expenditures  are  expected to be made in conjunction  with  this
matter. Although many major capital projects typically include  a
component  for  environmental control,  including  the  Company's
current expansion projects, no material expenditures specifically
for environmental control are expected to be made in 1997.

Employees

     As of December 31, 1996, the Company had approximately 2,550
employees, including 1,100 in the U.S. and 1,450 outside  of  the
U.S.

Item 1A.  Executive Officers of the Registrant

      The following is a list of the names and ages of all of the
Company's corporate officers and certain officers of each of  the
Company's principal operating units, indicating all positions and
offices  with  the Registrant held by each such person  and  each
such person's principal occupations or employment during the past
five years.

     Each of the Company's corporate officers has been elected to
the  indicated office or offices of the Registrant, to  serve  as
such until the next annual election of officers of the Registrant
(expected  to  occur  May 28, 1997) and until  his  successor  is
elected, or until his earlier death, resignation or removal.

Name and Position                  Principal Business Experience
with the Company            Age    During the Past Five Years
                                   
E.W. Sissener               68     Chief Executive Officer since
Chairman, Director and             June 1994.  Member of the
Chief Executive Officer            Office of the Chief Executive
                                   of the Company July 1991-- May
                                   1994.  Chairman of the Company
                                   since 1975.  President,
                                   Alpharma AS since October
                                   1994.  President of A.L.
                                   Industrier AS 1972--1994.
                                   Chairman of A.L. Industrier AS
                                   since November 1994.
                                   
Jeffrey E. Smith            49     Chief Financial Officer and
Vice President, Finance            Vice President since May 1994.
and Chief Financial                Executive Vice President and
Officer                            Member of the Office of the
                                   Chief Executive July 1991--
                                   May 1994.  Vice President,
                                   Finance of the Company from
                                   November 1984--July 1991.
                                   
Diane M. Cady               42     Vice President, Investor
Vice President,                    Relations since November 1996.
Investor Relations                 Vice President, Investor
                                   Relations for Ply Gem
                                   Industries, Inc. 1987--October
                                   1996.
                                   
Phil Corke                  43     Vice President, Human
Vice President, Human              Resources since April 1996.
Resources                          Director of Training,
                                   Development and International
                                   Compensation, Textron
                                   Corporation 1994--March 1996.
                                   Director, Human Resources--
                                   Europe, Bristol-Myers Squibb
                                   Company 1990--1993.
                                   
Beth P. Hecht               33     Corporate Counsel of the
Secretary and Corporate            Company since June 1993.
Counsel                            Secretary of the Company since
                                   November 1993. Attorney with
                                   the law firm of Kirkland &
                                   Ellis 1990--1993.
                                   
Albert N. Marchio, II       44     Treasurer of the Company since
Treasurer                          May 1992. Treasurer of Laura
                                   Ashley, Inc. 1990--1992.
                                   
John S. Towler              48     Controller of the Company
Controller                         since March 1989.
                                   
Thomas L. Anderson          48     President of the Company's
Vice President and                 U.S. Pharmaceuticals Division
President, U.S.                    since January 1997; President
Pharmaceuticals                    and Chief Operating Officer of
Division                           FoxMeyer Health Corporation
                                   May 1993--February 1996;
                                   Executive Vice President and
                                   Chief Operating Officer of
                                   FoxMeyer Health Corporation
                                   July 1991--April 1993.
                                   
David E. Cohen              42     President of the Company's
Vice President and                 Animal Health Division since
President, Animal                  October 1994; President,
Health Division                    Animal Health Division of
                                   A. L. Laboratories, Inc.
                                   September 1988--October 1994.
                                   
Thor Kristiansen            53     President of the Company's
Vice President and                 Fine Chemicals Division since
President, Fine                    October 1994; President,
Chemicals Division                 Biotechnical Division of
                                   Apothekernes Laboratorium A.S
                                   1986--1994.
                                   
Knut Moksnes                46     President of the Company's
Vice President and                 Aquatic Animal Health Division
President, Aquatic                 since October 1994; Managing
Animal Health Division             Director, Fish Health Division
                                   of Apothekernes Laboratorium
                                   A.S 1991--1994.
                                   
Ingrid Wiik                 52     President of the Company's
Vice President and                 International Pharmaceuticals
President,                         Division since October 1994;
International                      President, Pharmaceutical
Pharmaceuticals                    Division of Apothekernes
Division                           Laboratorium A.S 1986--1994.

Item 2.   Properties

     The Company's principal production and technical development
facilities are located in the United States, Denmark, Norway  and
Indonesia.    The  Company  also  owns  or  leases  offices   and
warehouses  in  the United States, Sweden, Holland,  Finland  and
elsewhere.

                                   FACILITY  
                           LAND      SIZE    
LOCATION        TITLE     (acres)    (sq.    USE
                                     ft.)    
Fort Lee, NJ    Leased         --    48,000  Office - Alpharma
                                             corporate office
                                             and AHD
                                             Headquarters
Skoyen, Norway  Leased         --   204,400  Manufacturing of
                                             AHD and FCD
                                             products, Alpharma
                                             corporate office
                                             and headquarters
                                             for IPD, FCD and
                                             AAHD.
Chicago         Owned          20   195,000  Manufacturing,
Heights, IL                                  warehouse, R&D and
                                             offices for AHD
Bellevue, WA    Leased         --    20,000  Manufacturing,
                                             warehouse,
                                             laboratory and
                                             offices for AAHD
Baltimore, MD   Owned          19   268,000  Manufacturing, and
                                             headquarters for
                                             USPD
Baltimore, MD   Leased         --    18,000  Research and
                                             Development for
                                             USPD
Columbia, MD    Leased         --   165,000  Central
                                             Distribution Center
                                             for USPD
Lincolnton, NC  Owned          13   138,000  Manufacturing and
                                             offices for USPD
Lowell, AK      Leased         --    68,000  Manufacturing,
                                             warehouse and
                                             offices for AHD
Niagara Falls,  Owned           2    30,000  Warehouse and
NY                                           offices for USPD
Lier, Norway    Owned          23   118,400  Manufacturing of
                                             IPD products,
                                             warehousing and
                                             offices
Overhalla,      Owned           1    12,900  Manufacturing of
Norway                                       vaccines,
                                             warehousing and
                                             offices for AAHD
Vennesla,       Owned           4    81,300  Manufacturing of
Norway                                       adhesive bandages
                                             and surgical tapes,
                                             warehousing and
                                             offices for IPD
Copenhagen,     Owned          10   425,000  Manufacturing,
Denmark                                      warehouse, R&D and
                                             offices for IPD and
                                             FCD
Jakarta,        Owned           5    80,000  Manufacturing,
Indonesia       building                     warehouse, R&D and
                leased                       offices for IPD
                land

     The Company believes that its principal facilities described
above are generally in good repair and condition and adequate and
suitable for the products they produce.


Item 3.   Legal Proceedings

      On  September  13, 1982, the Company filed  at  the  FDA  a
"Citizen  Petition"  requesting  the  agency  to  reconsider  and
rescind  its  approval of a new animal drug application  ("NADA")
filed  by  Philips Roxane, Inc. ("PRI") for the use of Bacitracin
Zinc  in  animal  feeds  for growth  promotion.   PRI  is  now  a
subsidiary  of  Boehringer  Ingleheim  Animal  Health  Inc.   The
Citizen  Petition contended that FDA's approval was  invalid  and
improper in several respects.  FDA denied the Citizen Petition on
May  9, 1984, and the Company filed an action for judicial review
in  the  U.S.  District Court for the District of  Columbia  (the
"Action")  seeking to have FDA's denial of the  Citizen  Petition
set  aside.  Subsequent administrative proceedings also  resulted
in  FDA  decisions denying the relief sought.  The  complaint  in
this  Action  was amended to challenge FDA's decisions  on  these
subsequent  proceedings.   The parties  filed  cross-motions  for
summary judgment and the U.S. District Court granted FDA's motion
for summary judgment to dismiss the Action.  The Company appealed
this  decision to the U.S. Court of Appeals for the  District  of
Columbia.  On August 25, 1995, the Court of Appeals held that FDA
had  not provided a reasonable explanation to support its finding
of  safety and efficacy of the PRI Bacitracin Zinc.  The  Court's
order gave the FDA 90 days to provide a satisfactory explanation.
On  October  27,  1995, the FDA sent to the Company's  counsel  a
letter  containing its explanation and filed this letter  in  the
U.S.  District Court, together with a Memorandum arguing that  it
had  complied  with  the Court of Appeals' remand.   The  Company
filed   an  opposing  Memorandum  arguing  that  FDA's  purported
explanation did not meet the terms of the Court of Appeals order.
Oral  argument  was held in the District Court  on  November  29,
1995.  Thereafter, on December 4, 1995, the District Court issued
an  order continuing the PRI NADA pending a decision by it as  to
whether the FDA's explanation was reasonable.  The matter remains
pending before the District Court.

      From  time to time the Company is involved in certain  non-
material  litigation which is ordinarily found in  businesses  of
this  type,  including contract, employment matters  and  product
liability   actions.   Product  liability   suits   represent   a
continuing   risk  to  pharmaceutical  companies.   The   Company
attempts   to  minimize  such  risks  by  strict  controls   over
manufacturing  and  quality  procedures.   Although  the  Company
carries  what it believes to be adequate insurance, there  is  no
assurance  that such insurance can fully protect it  against  all
such  risks  due  to  the  inherent potential  liability  in  the
business of producing pharmaceuticals for human and animal use.



Item 4.    Submission of Matters to a Vote of Security Holders

               Not applicable.
                            PART II

Item 5.   Market for Registrant's Common Equity and Related
               Stockholder Matters

Market Information

     The Company's Class A Common Stock is listed on the New York
Stock  Exchange ("NYSE").  Information concerning  the  1996  and
1995  sales prices of the Company's Class A Common Stock are  set
forth in the table below.

                              Stock Trading Price
                          1996                     1995
     Quarter         High      Low            High       Low

       First    $   27.375   $22.00           $23.13   $19.25
     Second       $ 26.00   $19.125          $24.00    $16.50
       Third    $   21.25   $14.625          $23.33    $17.25
     Fourth     $ 16.50     $10.625          $26.38    $21.38

      As  of  December 31, 1996 and March 1, 1997  the  Company's
stock closing price was $14.625 and $13.50, respectively.

     Warrants to purchase the Company's Class A Common Stock with
an  exercise  price of $21.945 and expiring on  January  3,  1999
commenced  trading on the NYSE in October 1995  with  an  initial
trade  of  $7.00.  At December 31, 1996 and March  1,  1997,  the
closing  price  of the Company's warrants was $2.375  and  $3.00,
respectively.

Holders

      As of March 1, 1997, there were 1,034 holders of record  of
the  Company's Class A Common Stock and A.L. Industrier held  all
of  the  Company's Class B Common Stock.  Record holders  of  the
Class  A Common Stock include Cede & Co., a clearing agency which
held      approximately  97% of the outstanding  Class  A  Common
Stock as a nominee.


Dividends

       The   Company  has  declared  consecutive  quarterly  cash
dividends  on  its Class A and Class B Common Stock beginning  in
the  third  quarter of 1984.   Quarterly dividends per  share  in
1996 and 1995 were $.045 per quarter or $.18 per year.
Item 6.   Selected Financial Data

      The  following is a summary of selected financial data  for
the  Company and its subsidiaries. Financial data for prior years
has  been  restated to reflect the 1994 combination with Alpharma
Oslo  as  a pooling of interests. The data for each of the  three
years  in  the  period ended December 31, 1996 have been  derived
from,  and  all  data  should be read in  conjunction  with,  the
audited   consolidated  financial  statements  of  the   Company,
included in Item 8 of this Report.  All amounts are in thousands,
except per share data.

                              Years Ended December 31,
Income  Statement Data (1) 1996(4)   1995      1994(3)   1993     1992

Total revenue            $486,184  $520,882  $469,263  $402,675  $358,632
Cost of sales             297,128   302,127   275,543   233,423   194,665

  Gross profit            189,056   218,755   193,720   169,252   163,967

Selling, general and
 administrative
 expenses                 185,136   166,274   177,742   139,038   128,658

 Operating income           3,920    52,481    15,978    30,214    35,309

Interest expense          (19,976)  (21,993)  (15,355)  (14,996)  (18,534)
Other income, net            (170)     (260)    1,113     1,880     3,937
 Income (loss) from
  continuing operations
  before taxes            (16,226)   30,228     1,736    17,098    20,712
Provision (benefit)
  for taxes                (4,765)   11,411     3,439     6,969     7,161
 Income (loss) from
  continuing operations  $(11,461) $ 18,817  $ (1,703) $ 10,129  $ 13,551
 Net income (loss)(2)    $(11,461) $ 18,817  $ (2,386) $ 10,129  $ 20,974
Average number of
 shares outstanding:
    Primary                21,715    21,754    21,568    21,581    18,388
   Fully Diluted           21,715    22,407    21,568    21,581    21,568
Earnings per share:
 Fully diluted
  Income (loss) from
   continuing operations $   (.53) $    .84  $   (.08) $    .47  $    .74
  Net income (loss)      $   (.53) $    .84  $   (.11) $    .47  $   1.09
  Dividend per common
  share                  $    .18  $    .18  $    .18  $    .18  $    .18

(1)  Includes results of operations from date of acquisition of the Wade
Jones  Company  (July  1994), the Lincolnton facility  (March  1993),
Norgesplaster  A/S  (January  1993),  and  Able  Laboratories,   Inc.
(October  1992).  Reflects  the adoption of  Statement  of  Financial
Accounting  Standards No. 109 and No. 106 effective January  1,  1992
and January 1, 1993, respectively.

(2)  Net income includes: 1994 - extraordinary item - loss on
extinguishment of debt ($683); 1992 - cumulative effect of a change
in accounting for income taxes - $2,614; 1992 - Income from
discontinued Human Nutrition Segment - $4,809.

(3)  1994 includes transaction costs relating to the combination with
Alpharma  Oslo and management actions which are included in  cost  of
goods  sold ($450) and selling, general and administrative ($24,200).
Amounts net after tax of approximately $17,400.

(4)  1996  includes  management actions  relating  to  production
rationalizations  and severance which are  included  in  cost  of
goods      sold  ($1,100) and selling, general and administrative
($17,700).     Amounts net after tax of approximately $12,600.

                                 As of December 31,
Balance Sheet Data (1)    1996       1995      1994      1993      1992

Current assets           $274,859  $282,886  $250,499  $202,913  $178,283

Non-current assets        338,548   351,967   341,819   324,704   302,730

 Total assets           $613,407  $634,853  $592,318  $527,617  $481,013

Current liabilities      $155,651  $169,283  $154,650  $139,205  $107,015

Long-term debt,
  less current
  maturities              233,781   219,451   220,036   144,350   133,701

Deferred taxes and
  other non-current
  liabilities              37,933    40,929    36,344    40,129    33,454

Stockholders' equity(2)   186,042   205,190   181,288   203,933   206,843
  Total liabilities
  and equity             $613,407  $634,853  $592,318  $527,617  $481,013


(1)  Includes accounts from date of acquisition of the Wade Jones
     Company  (July 1994), the Lincolnton facility (March  1993),
     Norgesplaster  A/S  (January 1993), and  Able  Laboratories,
     Inc.  (October  1992) and the conversion of the  Convertible
     Subordinated Debentures in 1992.

(2)  1994 reflects acquisition of Alpharma Oslo accounted for  as
     a  pooling  of  interests with cash purchase price  deducted
     from stockholders' equity.

          
Item 7.   Management's  Discussion  and  Analysis  of   Financial
          Condition and Results of Operations

Overview

      1996  was  a year in which internally initiated  management
actions  intended to improve future operations resulted  in  1996
charges   and  external  market  conditions  adversely   affected
operations  in  both industry segments to varying degrees.  These
factors  combined  to produce a loss for 1996  and  included  the
following:

 Management actions - approximately $12.6 million after tax.

         Rationalization  of  the  International   Pharmaceutical
     Division's  ("IPD")  selling and marketing  organization  in
     Scandinavia resulting in charges for severance.

        Commencement  of  an  IPD plan to  transfer  all  tablet,
     ointment  and liquid production from Copenhagen, Denmark  to
     Lier, Norway resulting in charges for severance, asset write-
     offs and other exit costs.

        Commencement of a U.S. Pharmaceuticals Division  ("USPD")
     plan to accelerate the move of production from locations  in
     New  Jersey and New York to an existing plant in Lincolnton,
     North  Carolina  resulting in charges for  severance,  asset
     write-offs and other exit costs.

        Rationalization of the Animal Health Division ("AHD") and
     USPD organizations to address current competitive conditions
     in  their  respective industries resulting  in  charges  for
     severance and other termination benefits.

 External Factors.

        Fundamental  shift  in  generic  pharmaceutical  industry
     distribution, purchasing and stocking patterns resulting  in
     significantly lower sales and prices in the USPD.

        Significant bad debt expense due to the bankruptcy  of  a
     major wholesaler to the USPD and collection difficulties  in
     certain international markets.

       High feed grain prices in the Animal Health industry which
     resulted  in lower industry usage of feed additive  products
     supplied  by  AHD  and  increased  competition  among   feed
     additive suppliers.

        Generally  increased competition in  all  industries  and
     markets served by the Company's operating divisions.

      By comparison, 1995 was a year where management actions had
a  neutral  effect on profitability and markets  were  relatively
steady.

      1994 was a year of significant change for the Company.  The
following  major  events  occurred  and  had  an  effect  on  the
Company's operations and financial position.

           The  Company  acquired  the  related  Norwegian  Human
       Pharmaceutical  and  Animal Health  businesses  ("Alpharma
       Oslo")  of  its controlling shareholder for $23.6  million
       and  warrants  to  purchase  3.6  million  shares  of  the
       Company's  Class  A  Common  Stock.  The  combination  was
       accounted  for  in  a  manner  similar  to  a  pooling  of
       interests  since the companies were under common  control.
       All  prior  financial statements were restated to  include
       Alpharma Oslo.

          The  Company  reorganized its business  into  two  main
       segments.   The   Human  Pharmaceuticals   Segment   which
       includes   the  IPD,  the  USPD  and  the  Fine  Chemicals
       Division  ("FCD"),  and the Animal  Health  Segment  which
       includes  the  AHD (both U.S. and International)  and  the
       Aquatic Animal Health Division ("AAHD").

         The Company incurred significant charges as follows:

                     Direct transaction expenses relating to  the
          acquisition   of   Alpharma  Oslo   including   special
          committee  fees, investment banking, legal,  accounting
          and other expenses - $2.9 million after tax.

                     Post-combination  management  actions  which
          resulted  in charges for severance, exiting of  certain
          businesses and product lines and other related  actions
          - $14.5 million after tax.

          The  Company obtained a $185.0 million credit  facility
       to  purchase Alpharma Oslo, refinance a significant amount
       of  existing  long  and short term debt  and  for  general
       corporate  purposes.  The  refinancing  of  existing  debt
       resulted  in  an  extraordinary item for a  loss  on  debt
       extinguishment of $.7 million after tax.

       On  a  comparative  basis  excluding  management  actions,
operating  income by segment for the three years was  as  follows
(in millions):

                           HPS       AHS    Unallocated   Total
                                                         
Operating income* 1996     $5.6     $22.5     $(5.4)      $22.7
Operating income* 1995    $25.5     $31.4     $(4.6)      $52.3
Operating income* 1994    $15.2     $30.5     $(5.0)      $40.7

*Excludes  management actions which are detailed in the  year  on
year analysis.

Results of Operations - 1996 Compared to 1995

      Total  revenue  decreased  $34.6  million  (6.7%)  in  1996
compared  to 1995. Operating income in 1996 was $3.9  million,  a
decrease of $48.6 million, compared to 1995. The Company recorded
a  net  loss in 1996 of $.53 per share compared to net income  of
$.84  per share in 1995. The net loss is attributable to  charges
for  management actions (approximately $.58 per share  net  loss)
and  generally  difficult  operating conditions.  (See  sections:
"Management Actions", "U.S. Generic Pharmaceutical Industry"  and
"Animal Health Division Market Conditions.")

      Revenues  declined  by $5.1 million (3.1%)  in  the  Animal
Health  Segment ("AHS"). The AHD revenues declined due  to  lower
sales  volume of BMDr and other feed additives primarily  to  the
poultry  market and price erosion due to competition. The decline
in  the  sale  of other feed additives to the poultry  market  is
attributable  mainly to the mutual termination of a  distribution
agreement with Merck AgVet. AAHD revenues were lower due  to  the
introduction  of  competitive  products  in  the  Norwegian  fish
vaccine  market  and  an overall reduction  in  Norwegian  salmon
production.

      Revenues in the Human Pharmaceuticals Segment ("HPS")  were
$29.7 million lower primarily due to USPD revenues which declined
approximately 12%, as a result of price and volume reductions  in
the  base product line (principally cough and cold products)  due
to  a fundamental shift in industry distribution, purchasing  and
stocking  patterns  including  a substantial  drop  in  sales  to
generic drug distributors. The declines were partially offset  by
increased sales of products introduced in 1994 and 1995 and sales
of  Minoxidil introduced in the second quarter of 1996.  Revenues
for  IPD and FCD declined by 3.9% and 5.1%, respectively  due  to
volume  reductions  and to a lesser extent  currency  translation
offset partially by limited price increases.

      On  a  consolidated  basis, gross  profit  decreased  $29.7
million
and  the gross margin percent was 38.9% in 1996 compared to 42.0%
in  1995. The gross profit for the Animal Health Segment declined
due  to  the  lower  volume sold of BMDr  and  high  margin  fish
vaccines  and  generally lower pricing due  to  competition.  The
gross  profit in the Pharmaceuticals Segment declined over  $20.0
million  due  principally to the USPD. The USPD was  affected  by
lower  sales volume, and significantly lower pricing  across  the
product  line  due  to  changes  in  the  generic  pharmaceutical
industry.  Lower  sales  volume also  affected  gross  profit  by
causing  reduced  production  volume which  increases  production
costs  per  unit.  IPD and FCD also had lower gross  margins  due
primarily to lower sales. In addition, 1996 includes $1.1 million
primarily  for accrued stay bonuses for production  employees  in
facilities  to be closed in both the USPD and IPD.  (Included  in
Management Actions.)

     Operating expenses (i.e. selling, general and administrative
expenses "SG&A") on a consolidated basis increased $18.9  million
or  11.3%.  Included  in 1996 operating expenses  are  management
actions  totaling  $17.7 million which include the  following  by
segment:  HPS - severance and termination benefits, $6.7 million;
write off of assets at facilities to be closed $4.1 million;  and
exit   costs  and  other  $2.1  million.  AHS  -  Severance   and
termination benefits $4.0 million; and exit costs and  other  $.4
million.  Unallocated  - severance and termination  benefits  $.4
million.  Additionally, 1996 includes bad debt expenses  of  $2.0
million related to the bankruptcy of a major wholesaler and  $1.0
million for financial advisory and consulting services related to
a  potential  acquisition.  The following  table  summarizes  the
above:

                                 1996         1995
                                           
SG&A as reported               $185.1        $166.3
                                           
Management actions                         
(described herein)                         
   1996                         (17.7)     
   1995                                          .2
                                           
Financial advisory fees          (1.0)     
                                           
Bad debt expense related                   
  to the bankruptcy                        
  of a wholesaler                (2.0)       _____
                                           
SG&A as adjusted               $164.4        $166.5

      The  lack  of growth in SG&A, excluding the items described
above,  reflects  an  emphasis on cost  control  in  response  to
difficult  business conditions in a number of markets  (including
lower  bonuses  paid in 1996), a reduction of expenses  resulting
from  prior  year  management actions which reduced  payroll  and
generally  flat selling and marketing expenses certain  of  which
vary directly with sales.

     Operating income as reported declined $48.6 million.

      The  Company believes the change in operating  income  from
1995 to 1996 can be approximated as follows:

                            HPS      AHS   Unallocated    Total
                                                        
Operating income 1995     $26.1    $30.8    $(4.4)       $52.5
                                                        
 Sales/gross profit                                     
 (decrease) increase:                                   
     Volume               (21.0)   (7.0)                 (28.0)
     Price                 (8.0)   (2.0)                 (10.0)
     New products          12.0    4.0                    16.0
(Increase) Decrease in:                                 
  Production and                                        
    operating expenses     (2.9)   (3.8)      (.9)        (7.6)
  Management Actions      (14.4)    (4.1)     (.5)       (19.0)
                                                        
Operating income 1996    $ (8.2)   $ 17.9   $(5.8)      $  3.9

      Interest expense declined $2.0 million in 1996 compared  to
1995  due to lower interest rates in 1996 and to a lesser  extent
decreased average debt levels.

     The provision for income taxes was 37.8% in 1995 compared to
a  benefit for income taxes (due to the pre-tax loss) of 29.4% in
1996. The principal difference between both the actual rates  and
the  statutory  rates  is  due to the  effect  of  non-deductible
expenses (principally goodwill).

Results of Operations - 1995 Compared to 1994

      Total  revenue increased to $520.9 million in 1995 compared
to  $469.3  million  in 1994. Operating income,  net  income  and
earnings  per share all increased substantially in 1995  as  1994
included  significant  transaction expenses and  post-combination
management actions. As a result, the Company reported net  income
of $18.8 million ($.84 per share fully diluted) in 1995 versus  a
loss of $2.4 million in 1994 ($.11 loss per share).

      Revenue in the Human Pharmaceuticals Segment accounted  for
$29.3  million  of  the consolidated revenue  increase.  The  IPD
accounted for the major portion of the HPS increase. IPD revenues
increased  due to volume growth in Northern Europe and Indonesia,
the  translation of sales in Norwegian Kroner ("NOK") and  Danish
Kroner  ("DKK")  into  the U.S. Dollar and  to  a  lesser  extent
selected  price increases where permitted. Current pricing  in  a
number of European markets continues to be suppressed in part  by
legislation enacted to contain pharmaceutical costs. Oral  Health
Care  ("OHC")  revenues increased over $1.0 million  compared  to
1994  and  due to increased R&D expenses the operating  loss  was
approximately  the  same  as  1994.  Sales  by   the   FCD   were
approximately  the  same  as  in 1994  in  local  currencies  but
increased when translated into U.S. Dollars.

      Revenues  in  the USPD were flat on a year to  year  basis.
Increases in sales of products introduced in late 1994  and  1995
(including   Cimetidine  HCL  Solution,  Clobetasol   Cream   and
Ointment,  Clemastine Fumarate Syrup and a number of  other  over
the  counter and prescription products), some price increases and
increased volume in a number of products were offset by  declines
in  the volume of cough and cold products sold due to a mild  flu
season  in  early 1995 as well as the discontinuance of  products
containing iodinated glycerol in July of 1994.

      Animal Health Segment revenues increased primarily  due  to
the acquisition of the Wade Jones Company, Inc. in July 1994.  In
addition,  revenue increases were achieved due  to  higher  sales
internationally and, to a lesser extent, domestically, of disease
preventative  products  used  in poultry  markets  and  sales  of
products   made  pursuant  to  a  poultry  products  distribution
agreement  signed  with Merck AgVet in July  1994.  In  1996  the
distribution  agreement  was terminated by  mutual  agreement  as
Merck  sold  its poultry line to an unrelated third  party.  BMDr
sales  increased marginally with volume gains in poultry markets,
offset  by  lower volume in the domestic swine market  which  was
impacted  by  adverse  economic conditions  experienced  by  pork
producers. The AAHD sales of fish vaccines were lower  than  1994
due  to  increased  competition in the Norwegian  salmon  farming
market,  offset partially by sales of newly introduced trout  and
other vaccines.

     On a consolidated basis gross profit increased $25.0 million
and  the gross margin percent increased to 42.0% in 1995 compared
to 41.3% in 1994.

      Gross  profit  dollars in HPS accounted for  a  substantial
amount  of  the  dollar  increase due to increased  sales  volume
(especially by the IPD), production efficiencies, the  effect  of
translation of gross profits in DKK and NOK into U.S. Dollars for
both  the  IPD  and  FCD and selected price  increases  partially
offset  by  the  elimination of sales of  high  margin  iodinated
glycerol products. Gross profit percentages improved in HPS as  a
result  of  increases in gross margin percentages and amounts  in
IPD  and FCD which have higher than the prior years average gross
margin  percentage. Accordingly, the overall percentage  increase
is attributable to the HPS.

      Gross profit dollars in the Animal Health Segment increased
at a rate lower than the sales increase. The gross profit percent
declined  due to sales increases attributable to the  Wade  Jones
Company,  Inc.,  a distributor to the poultry market,  and  sales
made  pursuant to the poultry product distribution agreement with
Merck AgVet. The composition of Animal Health Division sales  has
changed  with  the addition of these two distribution  businesses
which  have lower gross margins. In addition, gross profits  were
negatively affected due to lower volume of high gross margin fish
vaccine sales.

      Operating expenses were $166.3 million in 1995 compared  to
$177.7 million in 1994. Operating expenses in 1995 include a  net
benefit   of  $.2  million  relating  to  1995  post  combination
management actions. The net benefit includes income from the sale
of  an  equity interest and other rights in an R&D company  ($6.5
million)  offset  by  the  utilization of substantial  consulting
resources  focused primarily on accelerating the  realization  of
certain  combination  benefits in  the  IPD  ($4.6  million)  and
severance  of  77  employees  in the  IPD,  USPD  and  AHD  ($1.7
million).  Operating expenses in 1994 include management  actions
and  transaction  expenses totaling $24.2 million  summarized  by
segment  as follows: HPS: severance of $2.9 million, $8.3 million
(including the write off of $5.8 million of intangibles) for  the
exit  of  the  USPD from the tablet business in  the  U.S.,  $3.4
million  for  a write off of an intangible relating  to  an  oral
health care product which will no longer be marketed, $.9 million
for  the  write down to fair market value of land which  will  be
held  for  sale,  $2.5  million for an  accelerated  payment  for
contractually  committed research and development relating  to  a
project  which  will no longer be funded by the Company  and  $.5
million  for  closing  sales  offices and  eliminating  duplicate
distributors and other. AHS: exiting of an antibiotic product and
related equipment of $1.7 million and severance of $.3 million.

     Unallocated expenses relate primarily to Corporate functions
and  include  severance  of  $.6 million  and  $3.1  million  for
transaction   expenses  primarily  for  legal,   accounting   and
investment  banking  services incurred in 1994  to  complete  the
combination.

      On   a   comparable  basis,  operating  expenses  increased
approximately  $13.0 million (8.5%) compared to  an  11.0%  sales
increase.  Operating expenses increased due to  variable  selling
expense  increases, additional research and development expenses,
the  acquisition of the Wade Jones Company in July 1994  and  the
effect  of  the  translation of NOK and DKK  expenses  into  U.S.
Dollars.

     Post combination and transaction expenses impacted operating
income by segment in 1995 and 1994 as follows:

                       HPS       AHS   Unallocated     Total
Operating income
 (loss) as reported:

    1995             $26.1      $30.8    $(4.4)        $52.5

    1994             $(3.8)     $28.5    $(8.7)        $16.0

Transaction costs
 and post-combination
 actions (income)
 expense:

    1995            $ (.7)     $  .5    $   -         $(.2)

    1994            $19.0      $  2.0   $  3.7       $24.7

Operating income (loss)
 excluding transaction
 costs (1994) and post-combination
 actions:

    1995            $25.4      $31.3    $(4.4)       $52.3


    1994            $15.2      $30.5    $(5.0)       $40.7

      Interest expense increased $6.6 million for the year  ended
1995, due to increased debt levels resulting from the acquisition
of  Alpharma Oslo in October 1994, increased capital expenditures
in  1994, the acquisition of the Wade Jones Company, Inc. in July
1994, and increased working capital requirements to support sales
increases. Additionally, interest rates have generally  increased
relative  to  1994. Comparability is also affected  in  that  the
Company  restated the 1994 financials to reflect the  acquisition
of  Alpharma Oslo in a manner similar to a pooling of  interests.
The restated results for 1994 do not include interest expense  on
either  the cash consideration or actual transaction costs  which
would have been incurred had the acquisition taken place in prior
periods.  The Company estimates that interest expense  calculated
on  a comparable basis in 1994 would have been approximately $1.5
million higher.

      Other  income (expense), net for 1995 includes net  foreign
exchange   transaction  losses  of  approximately   $.8   million
resulting   from  the  translation  of  non-functional   currency
receivables  net of non-functional currency payables and  forward
foreign exchange contracts. The losses were primarily recorded by
the  Company's subsidiaries in Norway and Denmark  in  the  first
quarter  of  1995  and primarily relate to sales  denominated  in
currencies (i.e. U.S. Dollar, Swedish Kroner, British  Pound  and
Portuguese Escudo) which depreciated significantly in  the  first
quarter compared to the NOK and DKK. In addition, currency losses
were  sustained by the Company's Mexican operations  due  to  the
devaluation of the Mexican Peso.

     The provision for income taxes in 1995 was 37.8% compared to
income taxes in excess of pretax income in 1994. The rate in 1995
represents a more normal relationship and the diminishing  effect
as  pre-tax income increases of non-deductible expenses primarily
related to goodwill amortization.

Inflation

     The effect of inflation on the Company's operations during
1996, 1995 and 1994 was not significant.

Governmental Actions affecting the Company

      The  Company's operations in all countries are  subject  to
regulation    which   includes   inspections   of   manufacturing
facilities, requires approvals to market products, and can result
in  the recall of products and suspension of production.  In  the
United  States the Food and Drug Administration (FDA) has imposed
stringent regulatory requirements on the pharmaceutical industry.
The  U.S. manufacturing companies included in the Company's Human
Pharmaceuticals Segment, as well as two of the Company's European
facilities that manufacture products for export to the U.S.,  are
affected  in  that  they are required to comply  with  the  FDA's
interpretation of CGMP.

      In 1994, 1995 and 1996, regulatory compliance has continued
to  affect costs directly by requiring the addition of personnel,
programs and capital and indirectly by adding activities  without
directly  increasing  efficiency.   The  costs  both  direct  and
indirect of regulatory compliance (which have increased in recent
years) may continue to increase in the future.

       In  the  fourth  quarter  of  1996  the  Company  recorded
approximately $1.3 million representing the estimated costs for a
recall  of  certain lots of four products: Guiatuss AC  and  DAC;
Dihistine  expectorant and Lidocaine. This recall  resulted  from
the  Company's ongoing internal quality programs which identified
a required revision of expiration dates for these products.

      In  July 1994, the Company ceased the marketing of products
which  contain iodinated glycerol.  The cessation was the  result
of an industry wide banning of such products by the FDA.  Because
the  FDA  allowed  for an orderly cessation  of  sales  of  these
products the immediate impact was minimized.

      Iodinated glycerol products represented approximately 2% of
the  Company's 1994 sales and the loss of sales of these products
negatively impacted the Company's 1995 operations.

      The Company and its subsidiaries have filed applications to
market  products with regulatory agencies both in  the  U.S.  and
internationally.  The  timing of receipt of  approvals  of  these
applications  can  significantly  increase  future  revenues  and
income.  The  Company  cannot control or  predict  with  accuracy
whether such applications will be approved or the timing of their
approval.

Management Actions

      In  December  1994,  the  Company  announced  a  number  of
management  actions which included staff reductions  and  certain
product  line  and facilities rationalizations as  a  first  step
toward realizing combination synergies and maximizing the overall
position of the newly combined Company. As a part of the December
1994   management  actions,  the  Company  discontinued   funding
research  projects relating to the colonic delivery of drugs  and
committed  to disposing of the resultant equity interest  in  the
R&D company performing the research.

       In   September  1995,  the  Company  announced  additional
management actions which continued the process begun in  December
1994.  The  actions include elimination of up  to  130  positions
company-wide (77 employees were severed in 1995), further efforts
toward  consolidation of operations in the  Company's  USPD,  the
utilization of substantial consulting resources focused primarily
on  accelerating the realization of certain combination  benefits
in  the  IPD  and  the sale in September of its  minority  equity
position and certain other rights in the R&D company.

      In  the  first  quarter of 1996 the Company  continued  the
process  and  announced the reorganization of the IPD  sales  and
marketing   organization  in  Scandinavia.   The   reorganization
resulted in severing 30 personnel at a cost of $1.9 million.  IPD
estimates  the annual expense reduction by 1997 from this  action
at over $1.0 million.

      In  the  second  quarter of 1996, the  Board  of  Directors
approved  an  IPD production rationalization plan which  includes
the  transfer of all tablet, ointment and liquid production  from
Copenhagen,  Denmark to Lier, Norway. The full transfer  will  be
completed  in  1998  and  will result in  the  net  reduction  of
approximately 100 employees. The rationalization plan resulted in
a  charge  in  the  second quarter for severance  for  Copenhagen
employees,  an  impairment write-off for  certain  buildings  and
machinery and equipment and other exit costs.

      In  1995  the Company announced a plan by USPD to move  all
suppositories and cream and ointment production from two  present
locations  to  the  Lincolnton, N.C. location.  The  transfer  of
prescription products requires the Company to obtain the approval
of  the  FDA for each product transferred. The Company  has  been
successful to date in the product transfer but the ultimate  time
necessary and complete success cannot be predicted with certainty
by  the  Company. Based on results through the second quarter  of
1996  USPD prepared to plan to accelerate the previously approved
plan  for  consolidation of the manufacturing  operations  within
USPD.  The  Board of Directors approved the acceleration  in  May
1996.

      The  acceleration  plan included the discontinuing  of  all
activities in two USPD manufacturing facilities in New  York  and
New Jersey and the transfer of all pharmaceutical production from
those  sites  to the facility in Lincolnton, North Carolina.  The
plan provided for complete exit by early 1997 and has resulted in
a  net  reduction  of over 150 employees. The  acceleration  plan
resulted in a second quarter charge for severance of employees, a
write-off  for leasehold improvements and machinery and equipment
and  significant  exit costs including estimated remaining  lease
costs  and facility refurbishment costs. In the third quarter  of
1996  the  Company sold its tablet business which was located  in
New  Jersey  and  sub-leased the New Jersey  location.  The  sale
netted proceeds of approximately $.5 million and resulted in  the
adjustment of certain accruals for exit costs made in the  second
quarter which contemplated the shut down of the facility.

     Because of the time necessary to complete the transfers, the
production rationalization plans include stay bonus plans to keep
the  production work force intact until the transfer is complete.
The  stay bonus plans generally require the employee remain until
their position is eliminated to earn a payment. The overall  cost
of  these plans is estimated at $1.9 million and is being accrued
over  the  periods necessary to achieve the shut  downs.  In  the
first quarter of 1997 the New York facility was shut down and the
stay bonus has been substantially paid.

      In  the  second half of 1996 additional management  actions
included  a reorganization at USPD which resulted in severing  15
employees  and  a  reorganization of the Animal  Health  Division
business practices and staffing levels which resulted in severing
and/or early retirement of 33 employees and other exit costs.

      As a result of the 1996 reorganizations in USPD and AHD the
Company believes annual payroll and payroll related costs of $2.5
million  have  been  eliminated. The  production  rationalization
plans  are expected to significantly benefit operations  in  1997
for USPD and in 1998 for IPD.

      The Company believes the dynamic nature of its business may
present   additional   opportunities  to  rationalize   personnel
functions    and   operations   to   increase   efficiency    and
profitability.  Accordingly,  while  no  actions  are   presently
planned,  similar  management actions  or  changes  to  announced
management actions may be required in the future.

U.S. Generic Pharmaceutical Industry

      The  U.S.  Generic Pharmaceutical industry has historically
been  characterized by intense competition which is evidenced  by
eroding  prices  for  products as additional market  participants
receive  approvals  for these products. Growth  has  historically
occurred  through  new  product approvals  and  subsequent  sales
exceeding  declines  in  the  base  product  line  due  to  price
reductions and/or volume decreases. Generic pharmaceutical market
conditions were further exacerbated in the second half of 1996 by
a  rapidly  emerging fundamental shift in industry  distribution,
purchasing  and stocking patterns. The shift has  resulted  in  a
substantial  drop in the USPD's volume overall but in  particular
to  generic  drug  distributors who represent  an  important  but
declining part of the Company's base business. Programs initiated
by major wholesalers have accelerated the changes and have forced
prices to decline at a faster rate. Wholesaler programs generally
require  lower  prices on products sold, lower  inventory  levels
kept  at  the  wholesaler  and fewer  manufacturers  selected  to
provide  products to the wholesalers. The USPD has been  affected
by   lower  sales  as  distributors  reduced  business   and   as
wholesalers reduced inventories and prices. The Company has  made
agreements  with major wholesalers to provide product but  cannot
predict the effect on future volume and prices. USPD has been and
will  continue  to  be affected by the competitive  and  changing
nature of this industry. Accordingly, because of competition, the
significance  of  relatively  few  major  customers  (i.e.  large
wholesalers,  distributors and chain stores), a rapidly  changing
market  and uncertainty of timing of new product approvals,  USPD
sales  volume  and prices are subject to unforeseen  fluctuation.
The   generic   industry  in  general  is  subject   to   similar
fluctuations.

Animal Health Division Market Conditions

      The Animal Health Division's principal product, BMDr, is  a
feed  additive  used  to promote growth and feed  efficiency  and
prevent  or  treat diseases in Swine and Poultry. AHD also  sells
other  feed  additives most of which are used in  combination  or
sequentially  with  BMDr. In 1996 and especially  in  the  second
quarter,  results were negatively impacted by  a  steep  rise  in
grain (corn and wheat) prices in the U.S.  The record high prices
of  these  feed grains in the second quarter resulted in  intense
price competition and a reduction in the use of feed additives in
general, including AHD products, primarily in the poultry market.
During  the  second  half of 1996 feed grain  prices  were  lower
relative to the second quarter but were still historically  high.
Price  and other competitive intensity has continued. The Company
does  not  believe grain prices will remain high permanently  but
does  believe  that competitive conditions in the  industry  will
remain  intense  for the foreseeable future.  The  Animal  Health
Division has reevaluated its business structure and practices  to
address the current industry conditions.

European Operations

      The  fluctuations  of  European currencies  have  and  will
continue  to  impact  the  Company's  European  operations  which
comprised  approximately  45%  of  revenues  in  the  year  ended
December  31,  1996. In addition, many European governments  have
enacted  or  are in the process of enacting mechanisms  aimed  at
lowering  the cost of pharmaceuticals. Currency fluctuations  and
governmental actions to reduce or not allow increases  of  prices
have affected revenue. The Company cannot predict future currency
fluctuations  or  future governmental pricing  actions  or  their
impact on the Company's results.

Liquidity and Capital Resources

      At  December  31,  1996, stockholders'  equity  was  $186.0
million compared to $205.2 million and $181.3 million at December
31, 1995, and 1994, respectively.  The ratio of long-term debt to
equity  was 1.26:1, 1.07:1 and 1.21:1 at December 31, 1996,  1995
and  1994, respectively. The decrease in stockholder's equity  in
1996  primarily  reflects the 1996 loss of  the  Company  and  an
decrease in the translation adjustment ($5.4 million) due to  the
weakening of the DK and NOK in 1996.

      Working  capital  at December 31, 1996 was  $119.2  million
compared to $113.6 million and $95.8 million at December 31, 1995
and   1994,  respectively.  The  current  ratio  was  1.77:1   at
December  31, 1996 compared to 1.67:1 and 1.62:1 at December  31,
1995 and 1994, respectively.

      Significant fluctuations included accounts receivable being
lower in 1996 by $11.6 million resulting from substantially lower
fourth  quarter  sales in the USPD and the European  subsidiaries
offset by a tax refund receivable of $7.2 million recorded due to
the  domestic  tax  loss  incurred by the  Company.  The  current
portion of long-term debt was reduced as a result of an amendment
to  the  Company's  long  term debt agreement.  Accrued  expenses
increased  due  primarily to accruals for  severance  related  to
management actions of approximately $9.3 million.

      All working capital elements also decreased in 1996 in U.S.
Dollars  as the functional currencies of the Company's  principal
foreign  subsidiaries,  the  Danish Krone  and  Norwegian  Krone,
weakened  versus  the  U.S.  Dollar  as  compared  to   1995   by
approximately 7% and 2%, respectively.  The approximate  decrease
due   to  currency  translation  was:  accounts  receivable  $2.4
million, inventory $2.3 million and accounts payable and  accrued
expenses $1.9 million.

      The  Company  presently  has  various  capital  expenditure
programs  under  way and planned including the expansion  of  the
Lier,   Norway   facility.  In  1996,   the   Company's   capital
expenditures were $30.9 million and in 1997 the Company plans  to
spend approximately the same amount as in 1996.

      At  December  31,  1996,  the  Company  had  $26.5  million
available  under existing short-term unused lines of  credit  and
$15.9 million in cash.  In addition, the Company has $1.5 million
available  in  Europe under long-term lines of  credit  and  $6.8
million available under an amended revolving credit facility. 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.  A  substantial
portion  of  the Company's short-term and long-term  debt  is  at
variable  interest rates. At December 31, 1996, the  Company  has
entered  into interest rate agreements to fix the interest  rates
for  $61.8  million  of  the variable debt  at  5.655%  plus  the
required  margin through October 1998. The Company is considering
similar  transactions to fix additional variable  rate  debt  for
specified  periods  to minimize the impact of future  changes  in
interest rates. The Company's policy is to selectively enter into
"plain  vanilla"  agreements to fix interest rates  for  existing
debt if it is deemed prudent.

       The  $185.0  million  credit  facility  contained  various
financial  covenants including the maintenance of minimum  equity
to  assets, current and interest coverage ratios.  During 1996 as
a  result  of  charges for management actions and poor  operating
results  the  Company requested and received  a  waiver  for  the
required  interest coverage ratio from the members  of  the  bank
syndicate  which  are  participants in the credit  facility.  The
ratio  required quarterly computation of compliance  based  on  a
trailing four quarters and accordingly, the Company and the banks
amended  the  agreement to determine compliance solely  based  on
1997  results  compared to 1997 interest. In addition  the  banks
agreed to include in equity the stock subscription of the Class B
shareholder of $20.8 million, convert existing debt tranches into
a  three and one half year revolving credit and adjust the amount
of the credit facility to $170.0 million.

      The  Company's prospective liquidity and capital  resources
were  strengthened  in  early 1997 when  the  Company  signed  an
agreement   with   A.L.   Industrier  whereby   A.L.   Industrier
irrevocably agreed to purchase 1,273,438 shares of Class B Common
for   $16.34  per  share  (total  proceeds  approximately   $20.8
million).  Concurrently  the  Company  announced  that  Class   A
shareholders would be issued special rights to purchase one share
of Class A Common Stock for $16.34 per share for every six shares
of   Class  A  Common  currently  held.  (Potential  proceeds  of
approximately $34.0 million.) If the Class A rights are exercised
the  current  ownership proportion between  the  Class  A  and  B
shareholders would be maintained. The distribution of the  rights
will  be  made  with a prospectus. The final details,  terms  and
conditions  of the rights have not been finalized, however,  they
are expected to be transferable and have a term expiring no later
than  November 30, 1997. A.L. Industrier's purchase  of  Class  B
Common  Stock will occur upon termination of the Class A  rights,
but  is  not  conditioned on the exercise of any of the  Class  A
rights.

      The  Company cannot predict whether the Class A rights will
be  exercised. The stock subscription for the Class B Common will
be  completed by the fourth quarter of 1997. (The subscription is
supported by a letter of credit.)

Item 8.   Financial Statements and Supplementary Data

      See page F-1 of this Report, which includes an index to the
consolidated   financial  statements  and   financial   statement
schedule.
Item 9.   Changes  in  and  Disagreements  With  Accountants   on
          Accounting and Financial Disclosure

     Not applicable.
                            PART III

Item 10.  Directors and Executive Officers of the Registrant

      The  information as to the Directors of the Registrant  set
forth  under the sub-caption "Board of Directors" appearing under
the  caption  "Election  of Directors"  of  the  Proxy  Statement
relating  to  the Annual Meeting of Shareholders to  be  held  on
May 28, 1997, which Proxy Statement will be filed on or prior  to
April  7,  1997, is incorporated by reference into  this  Report.
The information as to the Executive Officers of the Registrant is
included  in  Part I hereof under the caption Item 1A  "Executive
Officers  of the Registrant" in reliance upon General Instruction
G  to Form 10-K and Instruction 3 to Item 401(b) of Regulation S-
K.


Item 11.  Executive Compensation

      The  information  to  be  set forth  under  the  subcaption
"Directors'  Fees  and Related Information" appearing  under  the
caption  "Board of Directors" of the Proxy Statement relating  to
the  Annual Meeting of Shareholders to be held on May  28,  1997,
which Proxy Statement will be filed on or prior to April 7, 1997,
and  the  information  set  forth under  the  caption  "Executive
Compensation   and   Benefits"  in  such   Proxy   Statement   is
incorporated into this Report by reference.

Item  12.   Security Ownership of Certain Beneficial  Owners  and
Management

      The information to be set forth under the caption "Security
Ownership  of  Certain Beneficial Owners" of the Proxy  Statement
relating  to  the Annual Meeting of Stockholders expected  to  be
held  on  May  28,  1997, is incorporated  into  this  Report  by
reference.   Such Proxy Statement will be filed on  or  prior  to
April 7, 1997.

      There  are  no  arrangements known to the  Registrant,  the
operation of which may at a subsequent date result in a change in
control of the Registrant.

Item 13.  Certain Relationships and Related Transactions

      The  information to be set forth under the caption "Certain
Related  Transactions and Relationships" of the  Proxy  Statement
relating  to  the Annual Meeting of Stockholders expected  to  be
held  on  May  28,  1997, is incorporated  into  this  Report  by
reference.   Such Proxy Statement will be filed on  or  prior  to
April 7, 1997.

                            PART IV

Item 14.  Exhibits, Financial Statement Schedules and Reports  on
Form 8-K

List of Financial Statements

      See  page  F-1 of this Report, which includes an  index  to
consolidated   financial  statements  and   financial   statement
schedule.


List  of  Exhibits   (numbered in accordance  with  Item  601  of
Regulation S-K)

      3.1A   Amended and Restated Certificate of Incorporation of
the  Company,  dated  September  30,  1994  and  filed  with  the
Secretary of State of the State of Delaware on October  3,  1994,
was  filed as Exhibit 3.1 to the Company's 1994 Annual Report  on
Form 10-K and is incorporated by reference.

      3.1B    Certificate  of  Amendment of  the  Certificate  of
Incorporation of the Company dated September 15, 1995  and  filed
with the Secretary of State of Delaware on September 15, 1995 was
filed as Exhibit 3.1 to the Company's Amendment No. 1 to Form S-3
dated  September 21, 1995 (Registration on No. 33-60029)  and  is
incorporated by reference.

       3.2     Amended  and  Restated  By-Laws  of  the  Company,
effective as of October 3, 1994, were filed as Exhibit 3.2 to the
Company's 1994 Annual Report on Form 10-K and is incorporated  by
reference.

      4.1     Reference is made to Article Fourth of the  Amended
and Restated Certificate of Incorporation of the Company which is
referenced as Exhibit 3.1 to this Report.

      4.2     Warrant Agreement between the Company and The First
National  Bank  of  Boston, as warrant agent,  was  filed  as  an
Exhibit 4.2 to the Company's 1994 Annual Report on Form 10-K  and
is incorporated by reference.

        10.1     $185,000,000   Credit   Agreement   among   A.L.
Laboratories, Inc.,(now known as Alpharma U.S. Inc.) as Borrower,
Union Bank of Norway, as agent and arranger, and Den norske  Bank
AS,  as  co-arranger,  dated September 28,  1994,  was  filed  as
Exhibit 10.1 to the Company's 1994 Annual Report on Form 10-K and
is incorporated by reference.

      10.1A  Amendment to the Credit Agreement dated February 26,
1997  between the Company and the Union Bank of Norway, as  agent
is filed as an Exhibit to this report.

      Copies of debt instruments (other than those listed  above)
for  which  the related debt does not exceed 10% of  consolidated
total  assets  as of December 31, 1995 will be furnished  to  the
Commission upon request.

      10.2    Parent Guaranty, made by the Company  in  favor  of
Union Bank of Norway, as agent and arranger, and Den norske  Bank
AS, as co-arranger, dated September 28, 1994 was filed as Exhibit
10.2  to  the  Company's 1994 Annual Report on Form 10-K  and  is
incorporated by reference.

      10.3    Restructuring Agreement, dated as of May 16,  1994,
between the Company and Apothekernes Laboratorium A.S (now  known
as  A.L.  Industrier AS) was filed as Exhibit A to the Definitive
Proxy  Statement dated August 22, 1994 and is incorporated herein
by reference.

      10.4    Employment  Agreement dated  January  1,  1987,  as
amended  December 12, 1989, between I. Roy Cohen and the  Company
and  A.L.  Laboratories, Inc. was filed as Exhibit  10.3  to  the
Company's  1989  Annual Report on Form 10-K and  is  incorporated
herein by reference.

      10.5    Control  Agreement dated February 7,  1986  between
Apothekernes  Laboratorium A.S (now known as A.L. Industrier  AS)
and  the Company was filed as Exhibit 10.10 to the Company's 1985
Annual  Report  on  Form  10-K  and  is  incorporated  herein  by
reference.

      10.6   Amendment to Control Agreement dated October 3, 1994
between  A.L.  Industrier  AS  (formerly  known  as  Apothekernes
Laboratorium  A.S) and the Company was filed as Exhibit  10.6  to
the Company's 1994 Annual Report on Form 10-K and is incorporated
by reference.

      10.6A   Amendment to Control Agreement dated  December  19,
1996  between A.L. Industrier AS and the Company is filed  as  an
Exhibit to this report.

      10.7    The Company's 1983 Incentive Stock Option Plan,  as
amended  through June 7, 1995 was filed as Exhibit  10.7  to  the
Company's 1995 Annual Report on Form 10-K and is incorporated  by
reference.

      10.8   Employment agreement dated July 30, 1991 between the
Company  and  Jeffrey E. Smith was filed as Exhibit 10.8  to  the
Company's 1991 Annual Report on Form 10-K and is incorporated  by
reference.

      10.9    Employment agreement between the Company and Thomas
Anderson  dated January 13, 1997 is filed as an Exhibit  to  this
Report.

     10.10  Employment Agreement between the Company and David E.
Cohen  dated December 31, 1995 was filed as Exhibit 10.10 to  the
Company's 1995 Annual Report on Form 10-K and is incorporated  by
reference.

      10.11   Lease  Agreement  between A.L.  Industrier  AS,  as
landlord, and Alpharma AS, as tenant, dated October 3,  1994  was
filed  as  Exhibit 10.10 to the Company's 1994 Annual  Report  on
Form 10-K and is incorporated by reference.

       10.12   Administrative  Services  Agreement  between  A.L.
Industrier AS and Alpharma AS dated October 3, 1994 was filed  as
Exhibit  10.11 to the Company's 1994 Annual Report on  Form  10-K
and is incorporated by reference.

     10.13  Employment agreement dated March 14, 1996 between the
Company and Einar W. Sissener was filed as Exhibit 10.13  to  the
Company's 1995 Annual Report on Form 10-K and is incorporated  by
reference.

      10.14   Employment contract dated October 5,  1989  between
Apothekernes Laboratorium A.S (transferred to Alpharma  Oslo  per
the combination transaction) and Ingrid Wiik was filed as Exhibit
10.13  to  the Company's 1994 Annual Report on Form 10-K  and  is
incorporated by reference.

      10.15   Employment contract dated October 5,  1989  between
Apothekernes Laboratorium A.S (transferred to Alpharma  Oslo  per
the  combination transaction) and Thor Kristiansen was  filed  as
Exhibit  10.14 to the Company's 1994 Annual Report on  Form  10-K
and is incorporated by reference.

      10.16   Employment contract dated October 2,  1991  between
Apothekernes Laboratorium A.S (transferred to Alpharma  Oslo  per
the  combination  transaction) and  Knut  Moksnes  was  filed  as
Exhibit  10.15 to the Company's 1994 Annual Report on  Form  10-K
and is incorporated by reference.

      10.17   Stock  Subscription and  Purchase  Agreement  dated
February  10,  1997 between the Company and A.L.  Industrier  was
filed as Exhibit 10 on Form 8-K filed on February 19, 1997 and is
incorporated herein by reference.

      11      Computation of Earnings per Common  Share  for  the
years ended December 31, 1996, 1995 and 1994.

      21      A list of the subsidiaries of the Registrant as  of
March 18, 1997 is filed as an Exhibit to this Report.

      23      Consent  of  Coopers & Lybrand L.L.P.,  Independent
Accountants, is filed as an Exhibit to this Report.

     27     Financial Data Schedule

      See  exhibit index on Page E-1 for exhibits filed with this
report.

Report on Form 8-K

     On February 19, 1997, the Company filed a report on Form 8-K
dated February 10, 1997 reporting Item 5. "Other events" and Item
9. "Sales of Equity Securities pursuant to Regulation S".

      The  event  reported  was the Stock Subscription  Agreement
signed with A.L. Industrier and the intention to issue rights  to
the Class A Common stockholders.

Undertakings

      For  purposes of complying with the amendments to the rules
governing Form S-8 (effective July 13, 1990) under the Securities
Act  of  1933,  the undersigned Registrant hereby  undertakes  as
follows,  which  undertaking shall be incorporated  by  reference
into  Registrant's Registration Statement on  Form  S-8  No.  33-
60495:

     Insofar as indemnification for liabilities arising under the
Securities  Act  of 1933 may be permitted to directors,  officers
and  controlling  persons  of  the  Registrant  pursuant  to  the
foregoing  provisions,  or otherwise,  the  Registrant  has  been
advised  that  in  the  opinion of the  Securities  and  Exchange
Commission  such  indemnification is  against  public  policy  as
expressed  in  the  Securities Act of  1933  and  is,  therefore,
unenforceable.   In  the event that a claim  for  indemnification
against  such  liabilities  (other  than  the  payment   by   the
Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of
any  action,  suit or proceeding) is asserted by  such  director,
officer  or  controlling person in connection with the securities
being  registered, the Registrant will, unless in the opinion  of
its counsel the matter has been settled by controlling precedent,
submit  to  a  court  of  appropriate jurisdiction  the  question
whether  such indemnification by it is against public  policy  as
expressed  in  the  Act  and  will  be  governed  by  the   final
adjudication of such issue.

                           SIGNATURES

      Pursuant to the requirements of Section 13 of the Securities and
Exchange Act of 1934, the Registrant has duly caused this report to be
signed on its behalf by the undersigned thereunto duly authorized.

March 21, 1997                ALPHARMA INC.
                              Registrant


                              By: /s/ Einar W. Sissener
                                  Einar W. Sissener
                                  Chairman, Director and
Chief Executive Officer

     Pursuant to the requirements of the Securities and Exchange Act of
1934,  this  Report has been signed below by the following persons  on
behalf  of  the  Registrant and in the capacities  and  on  the  dates
indicated.


Date:  March 21, 1997              /s/ Einar W. Sissener
                                   Einar W. Sissener
                                   Chairman, Director and
                                   Chief Executive Officer



Date:  March 21, 1997              /s/ Jeffrey E. Smith
                                   Jeffrey E. Smith
                                   Vice President, Finance and
                                   Chief Financial Officer
                                   (Principal accounting officer)




Date:  March 21, 1997              /s/ I. Roy Cohen
                                   I. Roy Cohen
                                   Director and Chairman of the
                                   Executive Committee




Date:  March 21, 1997              /s/ Thomas G. Gibian
                                   Thomas G. Gibian
                                   Director and Chairman of the
                                   Audit Committee



Date:  March 21, 1997              /s/ Glen E. Hess
                                   Glen E. Hess
                                   Director



Date:  March 21, 1997              /s/ Peter G. Tombros
                                   Peter G. Tombros
                                   Director and Chairman
                                   of the Compensation Committee




Date:  March 21, 1997              /s/ Erik G. Tandberg
                                   Erik G. Tandberg
                                   Director



Date:  March 21, 1997              /s/ Gert Munthe
                                   Gert Munthe
                                   Director

   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND SCHEDULES

                         ______________




                                                       Page

Consolidated Financial Statements:

  Report of Independent Accountants                         F-2

  Consolidated Balance Sheet at
     December 31, 1996 and 1995                        F-3

  Consolidated Statement of Operations for
     the years ended December 31, 1996,
     1995 and 1994                                     F-4

  Consolidated Statement of Stockholders'
     Equity for the years ended
     December 31, 1996, 1995 and 1994                F-5 to F-7

  Consolidated Statement of Cash Flows
     for the years ended December 31, 1996,
     1995 and 1994                                   F-8 to F-9

  Notes to Consolidated Financial Statements         F-10 to F-40

Financial  statement schedules are omitted for  the  reason  that
they  are  not applicable or the required information is included
in the consolidated financial statements or notes thereto.
               REPORT OF INDEPENDENT ACCOUNTANTS




To the Stockholders and
 Board of Directors of
 Alpharma Inc.:


      We  have  audited the consolidated financial statements  of
Alpharma  Inc.  and Subsidiaries (the "Company")  listed  in  the
index  on page F-1 of this Form 10-K.  These financial statements
are   the  responsibility  of  the  Company's  management.    Our
responsibility  is  to  express an  opinion  on  these  financial
statements based on our audits.

      We  conducted  our  audits  in  accordance  with  generally
accepted  auditing standards.  Those standards  require  that  we
plan  and perform the audit to obtain reasonable assurance  about
whether   the   financial  statements  are   free   of   material
misstatement.   An  audit includes examining, on  a  test  basis,
evidence  supporting the amounts and disclosures in the financial
statements.   An  audit  also includes assessing  the  accounting
principles used and significant estimates made by management,  as
well  as evaluating the overall financial statement presentation.
We  believe  that our audits provide a reasonable basis  for  our
opinion.

      In  our opinion, the financial statements referred to above
present  fairly,  in  all  material  respects,  the  consolidated
financial  position  of   Alpharma Inc. and  Subsidiaries  as  of
December 31, 1996 and 1995 and the consolidated results of  their
operations  and their cash flows for each of the three  years  in
the  period ended December 31, 1996 in conformity with  generally
accepted accounting principles.





                                        COOPERS & LYBRAND L.L.P.
Parsippany, New Jersey
March 5, 1997
                 ALPHARMA INC. AND SUBSIDIARIES
                   CONSOLIDATED BALANCE SHEET
                (In thousands, except share data)

                                               December 31,
                                            1996         1995
ASSETS
Current assets:
 Cash and cash equivalents              $ 15,944      $ 18,351
 Accounts receivable, net                 120,551      132,161
 Inventories                             123,585       120,084
 Prepaid expenses and other
  current assets                          14,779        12,290

     Total current assets                274,859       282,886

Property, plant and equipment, net       209,803       212,176
Intangible assets, net                   119,918       128,186
Other assets and deferred charges          8,827        11,605

       Total assets                     $613,407      $634,853

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
 Current portion of long-term debt       $ 4,966      $ 13,160
 Short-term debt                          60,952        62,695
 Accounts payable                         30,557        38,343
 Accrued expenses                         57,731        48,435
 Accrued and deferred income taxes          1,445        6,650

     Total current liabilities           155,651       169,283

Long-term debt                           233,781       219,451
Deferred income taxes                     29,882        30,961
Other non-current liabilities              8,051         9,968

Stockholders' equity:
 Preferred stock, $1 par value,
   no shares issued
 Class A Common Stock, $.20
   par value, 13,813,516 and
   13,699,592 shares issued                2,762         2,740
 Class B Common Stock, $.20 par value,
  8,226,562 shares issued                  1,646         1,646
 Additional paid-in capital              122,252       120,357
 Foreign currency translation adjustment  10,491        15,884
 Retained earnings                        54,996        70,385
 Treasury stock, 274,786 and 263,017
  shares of Class A Common Stock,
  at cost                                (6,105)       (5,822)

     Total stockholders' equity          186,042       205,190
         Total liabilities and
           stockholders' equity         $613,407      $634,853


         See notes to consolidated financial statements.
                 ALPHARMA INC. AND SUBSIDIARIES
              CONSOLIDATED STATEMENT OF OPERATIONS
              (In thousands, except per share data)

                                      Years Ended December 31,
                                     1996     1995       1994

Total revenue                     $486,184  $520,882   $469,263
  Cost of sales                    297,128   302,127    275,543

Gross profit                       189,056   218,755    193,720
  Selling, general and
    administrative expenses        185,136   166,274    177,742

Operating income                     3,920    52,481     15,978
  Interest expense                (19,976)  (21,993)   (15,355)
   Other income (expense), net       (170)    (260)       1,113

Income (loss) before provision
(benefit) for income taxes,
and extraordinary item            (16,226)   30,228       1,736
     Provision (benefit) for
      income taxes                 (4,765)    11,411      3,439

Income (loss) before extraordinary
  item                            (11,461)    18,817     (1,703)

Extraordinary item, net of tax     _______   _______       (683)

Net income (loss)                $(11,461)  $ 18,817  $ (2,386)

Average common shares outstanding:
  Primary                           21,715    21,754     21,568
  Fully diluted                     21,715    22,407     21,568

Earnings per common share:
Primary
  Income (loss) before extraordinary
    item                          $   (.53)  $    .86  $    (.08) 
     Net income (loss)            $   (.53)  $   .86   $   (.11)
Fully diluted
  Income (loss) before extraordinary
    item                          $   (.53)  $    .84  $   (.08)
  Net income (loss)                $   (.53)  $   .84  $   (.11)

         See notes to consolidated financial statements.

<TABLE>
                         ALPHARMA INC. AND SUBSIDIARIES
<CAPTION>
                 CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
                             (COMMON STOCK ACCOUNTS)
                        (In thousands, except share data)


                                                Class    Class
                                                 A        B
                                                Common    Common
                                                Stock     Stock      Treasury Stock         Total
                                                                                            Common
                                   Common
                                   Shares        Par        Par        Shares               Stock
                                   Issued        Value      Value      Held         Cost    Accounts
<S>                                <C>           <C>        <C>        <C>         <C>       <C>     
Balance,  December  31,  1993      21,794,245    $2,714     $1,646     (247,210)   (5,498)   $(1,138)

Purchase   of  treasury  stock                                           (1,710)      (24)       (24)
Exercise of stock options
 (Class A)                              2,750         1                                            1
Employee stock purchase plan           48,358         9                                            9
Balance,  December  31,  1994      21,845,353    $2,724     $1,646     (248,920)   $(5,522)  $(1,152)

Purchase   of  treasury  stock                                          (14,097)      (300)     (300)
Exercise of stock options
 (Class A)                             44,025         9                                            9
Employee stock purchase plan           36,776         7                                  7
Balance,  December  31,  1995      21,926,154    $2,740     $1,646     (263,017)   $(5,822)  $(1,436)

Purchase   of  treasury  stock                                          (11,769)      (283)     (283)
Exercise of stock options              66,637        13                                           13
  (Class A)
Employee stock purchase plan           47,287         9                                            9

Balance,  December  31,  1996      22,040,078    $2,762     $1,646     (274,786)   $(6,105)  $(1,697)
</TABLE>
        
<TABLE>
                 ALPHARMA INC. AND SUBSIDIARIES
<CAPTION>
                 CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
                        (In thousands, except share data)

                                                          Foreign                   Total
                                Common       Additional   Currency                  Stock-
                                Stock        Paid-In      Translation   Retained    holders'
                                Accounts     Capital      Adjustment    Earnings    Equity
<S>                             <C>          <C>          <C>            <C>         <C>                                
Balance, December 31, 1993      $(1,138)     $111,473     $    307       $93,291     $203,933

Net loss - 1994                                                           (2,386)      (2,386)
Dividends declared
  ($.18 per common share)                                                 (3,893)      (3,893)
Net foreign currency
  translation adjustment                                     7,818                      7,818
Purchase of treasury stock          (24)                                                  (24)
Exercise of stock options
  (Class A)                           1            30                                      31
Employee stock purchase plan          9           778                                     787
Remittances from Alpharma Oslo to
  A.L.Industrier                                                          (1,384)      (1,384)
Appropriation of retained
  earnings equal to cash
  purchase price for Alpharma
  Oslo                                         23,594                    (23,594)
Purchase of Alpharma Oslo
  Cash paid                                   (23,594)                                (23,594)
Warrants issued                                 6,552                     (6,552)

Balance, December 31, 1994      $(1,152)     $118,833      $  8,125      $55,482     $181,288

Net income -1995                                                          18,817       18,817
Dividends declared
  ($.18 per common share)                                                 (3,914)      (3,914)
Net foreign currency
  translation adjustment                                      7,759                      7,759
Tax benefit realized from
  stock option plan                               137                                     137
Purchase of treasury stock         (300)                                                 (300)
Exercise of stock options
  (Class A)                           9           578                                     587
Employee stock purchase plan          7           809                                     816


Balance, December 31, 1995      $(1,436)     $120,357      $ 15,884       $70,385    $205,190

Net loss - 1996                                                           (11,461)   (11,461)
Dividends declared
  ($.18 per common share)                                                  (3,928)    (3,928)
Net foreign currency
  translation adjustment                                     (5,393)                  (5,393)
Tax benefit realized from
  stock option plan                               202                                    202
Purchase of treasury stock         (283)                                                       (283)
Exercise of stock options
  (Class A)                          13           862                                     875
Employee stock purchase plan          9           831                                     840


Balance, December 31, 1996      $(1,697)     $122,252      $ 10,491       $54,996    $186,042

                               See notes to consolidated financial statement.
</TABLE>
 

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

                                            Years Ended  December 31,
                                             1996       1995      1994
Operating activities:
  Net income (loss)                     $(11,461)    $18,817  $ (2,386)
  Adjustments to reconcile net income
    (loss) to net cash provided by
    operating activities:
  Depreciation and amortization            31,503     31,022     26,773
  Deferred income taxes                   (3,104)      1,054   (5,506)
  Noncurrent asset write-offs               5,753                14,841
  Extraordinary item                                                683
  Change in assets and liabilities, net
    of effects from business
    acquisitions:
     (Increase) decrease in accounts
        receivable                          9,204    (9,295)   (14,864)
     (Increase) in inventory              (5,876)   (10,468)   (11,639)
     (Increase) in prepaid
        expenses and other current
        assets                              (595)    (1,462)      (774)
     Increase in accounts
        payable and accrued expenses        3,346      4,462    8,492
     Increase (decrease) in accrued
        income taxes                      (4,523)      2,802    (1,269)
  Other, net                                  574      (104)    2,811
     Net cash provided by operating
       activities                          24,821     36,828   17,162

Investing activities:

  Capital expenditures                   (30,874) (24,836)     (44,326)
  Acquisition of Alpharma Oslo                                 (23,594)
  Purchase of acquired businesses,
     and intangibles, net of cash
     acquired                                        (3,500)   (13,733)
  Other                                    (348)        579    _______

      Net cash used in investing
        activities                       (31,222)   (27,757)   (81,653)
                                
                     Continued on next page.
         See notes to consolidated financial statements.
                 ALPHARMA INC. AND SUBSIDIARIES
        CONSOLIDATED STATEMENT OF CASH FLOWS (CONTINUED)
                    (In thousands of dollars)



                                            Years Ended December 31,
                                             1996       1995      1994
Financing activities:

  Net borrowings under
    lines of credit                      $  (630)   $  (296)  $   4,494
  Proceeds of long-term debt               24,213      9,000    164,423
  Reduction of long-term debt            (17,137)   (13,121)   (100,719)
  Dividends paid                          (3,928)    (3,914)     (3,893)
  Cash transfers between Alpharma Oslo
    and A.L. Industrier                                           4,991
  Treasury stock acquired                   (283)      (300)        (24)
  Proceeds from employee stock option
    and stock purchase plan                 1,715      1,403        818
  Other, net                                  201        137    (2,713)
      Net cash provided by (used in)
        financing activities                4,151    (7,091)    67,377

Exchange rate changes:

  Effect of exchange rate changes
    on cash                                 (627)      1,338    1,481
  Income tax effect of exchange rate
    changes on intercompany advances          470      (479)      (502)
Net cash flows from exchange rate
       changes                              (157)        859       979
Increase (decrease) in cash and cash
  equivalents                             (2,407)      2,839     3,865
Cash and cash equivalents at
  beginning of year                        18,351     15,512     11,647
Cash and cash equivalents at
  end of year                             $15,944    $18,351    $15,512



         See notes to consolidated financial statements.
                 ALPHARMA INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                (In thousands, except share data)


     1.   The Company:
     
      Alpharma   Inc.,   (the  "Company")  is   a   multinational
pharmaceutical company which develops, manufactures  and  markets
specialty  generic  and  proprietary  human  pharmaceutical   and
animal health products.
     
      The  Company's  Human Pharmaceutical business  consists  of
three divisions: The U.S. Pharmaceuticals Division ("USPD"),  The
International  Pharmaceuticals  Division  ("IPD")  and  the  Fine
Chemicals  Division  ("FCD"). The USPD's principal  products  are
generic  liquid  and topical pharmaceuticals  sold  primarily  to
wholesalers,  distributors and merchandising  chains.  The  IPD's
principal  products are dosage form pharmaceuticals and  adhesive
bandages sold primarily in Scandinavia and western Europe as well
as  Indonesia  and  certain middle eastern countries.  The  FCD's
principal  products are bulk pharmaceutical antibiotics  sold  to
the pharmaceutical industry in the U.S. and worldwide for use  as
active substances in a number of finished pharmaceuticals.

      The  Company's  Animal  Health  business  consists  of  two
divisions:  The  Animal Health Division ("AHD") and  the  Aquatic
Animal Health Division ("AAHD"). The AHD's principal products are
feed additive and other animal health products for animals raised
for commercial food production (principally poultry and swine) in
the  U.S.  and  worldwide.  The  AAHD  manufactures  and  markets
vaccines primarily for use in immunizing farmed fish (principally
salmon)  worldwide with a concentration in Norway. (See  Note  20
for segment and geographic information.)

      The  Company's  Class B stock (37.8% of  total  outstanding
common  stock)  is  totally  held by  A.L.  Industrier  AS  (A.L.
Industrier),  a  Norwegian Company. A.L. Industrier  is  able  to
control  the  Company through its ability to elect  more  than  a
majority of the Board of Directors and to cast a majority of  the
votes  in  any vote of the Company's stockholders. (See Notes  16
and 21.)

2.   Summary of Significant Accounting Policies:

     Principles of consolidation:

      The  consolidated financial statements include the accounts
of  the  Company and its domestic and foreign subsidiaries.   The
effects  of all significant intercompany transactions  have  been
eliminated.
     Use of Estimates:

      The  preparation of financial statements in conformity with
generally  accepted accounting principles requires management  to
make  estimates  and assumptions. The estimates  and  assumptions
affect  the  reported  amounts  of assets  and  liabilities,  the
disclosure  of contingent assets and liabilities at the  date  of
the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ
from those estimates.

     Cash equivalents:

      Cash equivalents include all highly liquid investments that
have an original maturity of three months or less.

     Inventories:

      Inventories are valued at the lower of cost or market.  The
last-in, first-out (LIFO) method is principally used to determine
the  cost  of the USPD manufacturing subsidiary inventories.  The
first-in, first-out (FIFO) and average cost methods are  used  to
value remaining inventories.

     Property, plant and equipment:

       Property,  plant  and  equipment  are  recorded  at  cost.
Expenditures  for additions, major renewals and  betterments  are
capitalized  and  expenditures for maintenance  and  repairs  are
charged  to income as incurred.  When assets are sold or retired,
their cost and related accumulated depreciation are removed  from
the accounts, with any gain or loss included in net income.

      Interest is capitalized as part of the acquisition cost  of
major construction projects.  In 1996, 1995 and 1994, $572,  $318
and $722 of interest cost was capitalized, respectively.

      Depreciation is computed by the straight-line  method  over
the estimated useful lives which are generally as follows:

          Buildings                 30-40 years
          Building improvements     10-30 years
          Machinery and equipment    2-20 years

     Intangible assets:

      Intangible assets represent the excess of cost of  acquired
businesses  over  the underlying fair value of the  tangible  net
assets  acquired  and  the  cost of technology,  trademarks,  New
Animal Drug Applications ("NADAs"), and other non-tangible assets
acquired  in  product  line acquisitions. Intangible  assets  are
amortized on a straight-line basis over their estimated period of
benefit.  The Company analyzes its intangible assets by division,
based  upon estimated future undiscounted cash flows. At December
31,  1996 and 1995 such analyses did not demonstrate any evidence
of   impairment.  The  following  table  is  net  of  accumulated
amortization   of  $42,982  and  $35,903  for  1996   and   1995,
respectively.

                                   1996      1995     Life
Excess of cost of acquired
businesses over the fair value
of the net assets acquired      $ 98,304   102,434     20 - 40

Technology, trademarks, NADAs
and   other                       21,614    25,752      6 - 20

                                $119,918   $128,186

     Foreign currency translation and transactions:

       The  assets  and  liabilities  of  the  Company's  foreign
subsidiaries  are  translated  from their  respective  functional
currencies  into U.S. Dollars at rates in effect at  the  balance
sheet  date.  Results of operations are translated using  average
rates  in  effect during the year.  Foreign currency  transaction
gains  and  losses  are  included in  income.   Foreign  currency
translation  adjustments are accumulated in a separate  component
of   stockholders'  equity.   The  foreign  currency  translation
adjustment  for 1996, 1995 and 1994 is net of $470,  ($479),  and
($502),   respectively,  representing  the  foreign  tax  effects
associated with intercompany advances to foreign subsidiaries.

     Foreign exchange contracts:

       The  Company  selectively  enters  into  foreign  exchange
contracts  to  buy and sell certain cash flows in  non-functional
currencies.  Foreign  exchange contracts  are  accounted  for  as
foreign currency transactions and gains or losses are included in
income.

     Interest Rate Transactions:

     The Company selectively enters into interest rate agreements
which  fix the interest rate to be paid for specified periods  on
variable rate long-term debt.  The effect of these agreements  is
recognized  over the life of the agreements as an  adjustment  to
interest expense.

     Income Taxes:

      The provision for income taxes includes federal, state  and
foreign income taxes currently payable and those deferred because
of  temporary differences in the basis of assets and  liabilities
between   amounts  recorded  for  financial  statement  and   tax
purposes.  Deferred  taxes  are calculated  using  the  liability
method.

       At   December  31,  1996,  the  Company's  share  of   the
undistributed  earnings  of its foreign  subsidiaries  (excluding
cumulative   foreign   currency  translation   adjustments)   was
approximately  $36,100. No provisions are made  for  U.S.  income
taxes  that  would be payable upon the distribution  of  earnings
which  have been reinvested abroad or are expected to be returned
in  tax-free distributions. It is the Company's policy to provide
for U.S. taxes payable with respect to earnings which the Company
plans to repatriate.

     Accounting for Postretirement Benefits:

       The  Company  accounts  for  postretirement  benefits   in
accordance  with  Statement  of  Financial  Accounting  Standards
"SFAS" No. 106 "Employers' Accounting for Postretirement Benefits
Other  than Pensions".  The statement requires accrual accounting
for these benefits over the service lives of the employees.

     Earnings Per Share:

      Primary  earnings  per  share is based  upon  the  weighted
average  number  of common shares outstanding  and  common  stock
equivalents  (i.e. stock options and commencing in 1994  warrants
to purchase common shares are included when dilutive).

     Fully diluted earnings per share reflect the dilutive effect
of  stock  options  and  the fully diluted  effect  of  the  1994
warrants when appropriate. Such options and warrants did not have
a dilutive effect in 1996 and 1994.

     Accounting for Impairment of Long-Lived Assets:

     Effective January 1, 1996, the Company formally adopted SFAS
No.  121 "Accounting for the Impairment of Long-Lived Assets  and
for Long-Lived Assets to be Disposed of."

      The  standard requires that long-lived assets  and  certain
identifiable  intangibles to be held and used  by  an  entity  be
reviewed   for   impairment  whenever  events   or   changes   in
circumstances indicate that the carrying amount of an  asset  may
not  be recoverable. The adoption of SFAS No. 121 did not have  a
material impact on the Company.

     Accounting for Stock Based Compensation:

     Effective January 1, 1996, the Company formally adopted SFAS
NO.  123, "Accounting for Stock-Based Compensation." The standard
establishes   a  fair  value  method  for  accounting   for   or,
alternatively,  disclosing the pro-forma  effect  of  stock-based
compensation  plans.  The  Company  has  adopted  the  disclosure
alternative. As a result, the adoption of this standard will  not
have  any  impact on reported results of operations and financial
position.

3.   Acquisition of Alpharma Oslo, Transaction Expenses and
     Management Actions

     On October 3, 1994, the Company completed the acquisition of
the  pharmaceutical, animal health, bulk antibiotic  and  aquatic
animal  health businesses of Apothekernes Laboratorium  A.S  (the
"Related Norwegian Businesses").

       In   order  to  accomplish  the  transaction  Apothekernes
Laboratorium A.S changed its name to A.L. Industrier  A.S  ("A.L.
Industrier") and demerged the Related Norwegian Businesses into a
new  Norwegian  corporation called Apothekernes  Laboratorium  AS
("Alpharma  Oslo").  The  Company then  acquired  the  shares  of
Alpharma Oslo through a tender offer.

      A.L.  Industrier is the beneficial owner  of  100%  of  the
outstanding shares of the Company's Class B stock. (See  Notes  1
and 16.)

      The consideration paid by the Company for Alpharma Oslo was
$30,146  consisting of $23,594 in cash, and warrants to  purchase
3.6  million  shares  of  the  Company's  Class  A  Common  Stock
(estimated  value  at  time of closing of $1.82  per  warrant  or
$6,552 in total). The warrants expire on January 3, 1999 and have
an exercise price of $21.945.

      The Company was required to account for the acquisition  of
Alpharma Oslo as a transfer and exchange between companies  under
common  control.  Accordingly in 1994, the accounts  of  Alpharma
Oslo  were  combined  with the Company at historical  cost  in  a
manner  similar  to  a  pooling-of-interests  and  the  Company's
financial statements were restated to include Alpharma  Oslo.  At
the  acquisition date, the consideration paid for  Alpharma  Oslo
was  reflected as a decrease to stockholders' equity net  of  the
estimated  value  ascribed  to  the  warrants.  There   were   no
adjustments  required  to  conform accounting  practices  of  the
companies.

       The  restated  statement  of  operations  for  the  period
January  1, to October 2, 1994 does not include interest  expense
related to the cash consideration paid on October 3, 1994 by  the
Company for Alpharma Oslo and related transaction costs. Assuming
cash   consideration  of  $23,594,  and  transaction   costs   of
approximately  $3,100,  interest expense  after  tax  would  have
decreased reported results by approximately $950 in 1994 (for the
period January 1, to October 2, 1994).

     In connection with the acquisition of Alpharma Oslo in 1994,
the   Company  incurred  transaction  expenses  related  to   the
combination for fees paid to a special committee of the Board  of
Directors  (charged  with  evaluating  the  feasibility  of   the
transaction), and investment banking, legal, accounting and other
transaction  expenses. In 1994 these expenses before tax  totaled
$3,100  of  which $2,600 were expensed in the fourth  quarter  of
1994.  Certain  of  these  expenses are not  deductible  for  tax
purposes. Additionally, to complete the acquisition, the  Company
refinanced   its   long-term  debt  and  incurred   a   loss   on
extinguishment of $683 ($1,102 loss less $419 of income taxes  or
$.03  per  share  which has been classified as  an  extraordinary
item.)

      Upon  consummation  of  the  acquisition  the  Company  was
reorganized  on  a  global  basis  into  decentralized   business
divisions. Each division was required to evaluate its business to
determine  actions necessary to maximize the division's  and  the
Company's competitive position. As a result, in December 1994 the
Board of Directors approved a plan and the Company announced post-
combination  management  actions which included  exiting  certain
businesses and product lines which did not fit into the Company's
new  strategic direction, severing certain employees employed  in
the  businesses or product lines to be exited or whose  positions
had  become redundant as a result of the acquisition and the sale
or  exiting  of  certain  support facilities  which  also  became
redundant as a result of the acquisition. A summary of  the  1994
charges resulting from these actions follows:

Pre-tax
Amount              Description of Action
$3,750              Sever  53  employees primarily in  the  Human
                    Pharmaceuticals Segment.

$8,800              Exit  by  sale  or  closing the  U.S.  tablet
                    business.    Write-off  includes   intangible
                    assets  of $5,800 and plant and equipment  of
                    $3,000.   During  1995  the  tablet  business
                    operated at a reduced level with a negligible
                    impact on operating income. The Company  sold
                    the tablet business in August 1996.

$5,000              Discontinue  manufacturing and  marketing  of
                    Aquatic Animal Health antibiotics and an oral
                    health  care product produced under  license.
                    Write off includes $1,600 of tangible assets,
                    primarily   machinery   and   equipment   and
                    intangible assets of $3,400.

  $900              Sell unimproved land which was to be the site
                    for  manufacturing expansion.  This land  was
                    no   longer  needed  as  a  result   of   the
                    acquisition resulting in a write down to fair
                    market  value. In 1995 and 1996 the land  was
                    offered for sale however, no transaction  was
                    consummated.   The   Company   believes    no
                    additional write down is warranted.

  $600              Close  duplicate sales offices and  eliminate
                    duplicate distributors.
                    
      In  addition, the Company made the decision  to  no  longer
pursue  research  and  development  activities  relating  to  the
colonic  delivery  of drugs and dispose of the  resultant  equity
position  and certain other rights in the R&D company  performing
the  research. The Company accelerated all contractually required
payments of $2,500 in the fourth quarter of 1994.

      The  1994  expenses  for transaction costs  (excluding  the
extraordinary  item) and the post-combination  actions  described
are included in cost of goods sold ($450) and in selling, general
and administrative expenses ($24,200).

      The  net after tax effect in 1994 of the transaction  costs
including  the extraordinary item was approximately $3,600  ($.17
per  share)  and the net after tax effect of the post-combination
actions  described  above  was approximately  $14,500  ($.67  per
share).

      In  the  third  quarter  of  1995,  the  Company  announced
additional  post-combination management actions  which  continued
the  process begun in December 1994. The actions occurred in  the
third  and  fourth  quarters of 1995 and  included  severance  of
certain   employees   company  wide,   further   efforts   toward
consolidation  of  operations in the  USPD,  the  utilization  of
substantial    consulting   resources   focused   primarily    on
accelerating the realization of certain combination  benefits  in
the IPD and the sale in September of its minority equity position
and certain other product rights in the R&D company.

      The net effect of the additional management actions for the
year  ended  December  31, 1995 was a net reduction  of  selling,
general  and administrative expenses of $159 resulting  from  the
income  received on the sale of the equity position  in  the  R&D
company and certain other product rights ($6,463) net of expenses
for  the other management actions ($6,304). The expenses  of  the
other management actions were $4,556 for consulting services  and
$1,748  for severance for 77 employees in the IPD, USPD and  AHD.
The  net  after  tax effect of the 1995 actions was approximately
zero.

      In  1996,  the  IPD  continued to take  additional  actions
designed  to  further strengthen the competitive  nature  of  the
division  by  lowering costs. In the first quarter of  1996,  IPD
severed  approximately 30 sales, marketing  and  other  personnel
based  primarily in the Nordic countries and incurred termination
related costs of approximately $1,900. The termination costs  are
included in selling, general and administrative expenses.

      In  May  1996, the Board of Directors approved a production
rationalization plan which includes the transfer of  all  tablet,
ointment and liquid production from Copenhagen, Denmark to  Lier,
Norway.  The  full transfer will be completed in  1998  and  will
result in the reduction of approximately 175 employees (primarily
involved in production). The rationalization plan resulted  in  a
charge  in  the  second  quarter  for  severance  for  Copenhagen
employees,  an  impairment write off for  certain  buildings  and
machinery and equipment and other exit costs.

     In addition in May 1996, the Board of Directors approved the
U.S.  Pharmaceuticals  Division ("USPD")  plan  to  accelerate  a
consolidation of manufacturing operations within USPD.

     The plan included the discontinuing of all activities in two
USPD manufacturing facilities in New York and New Jersey and  the
transfer of all pharmaceutical production from those sites to the
facility  in  Lincolnton, North Carolina. The plan  provided  for
complete  exit  by  early 1997 and resulted  in  a  reduction  of
approximately  200 employees (i.e. all production, administration
and  support  personnel  at the plants).  The  acceleration  plan
resulted in a second quarter charge for severance of employees, a
write-off  of leasehold improvements and machinery and  equipment
and  significant  exit costs including estimated remaining  lease
costs and refurbishment costs for the facilities being exited.

      Due  to  the  time necessary to achieve both  transfers  of
production  the  Company, as part of the severance  arrangements,
has  instituted stay bonus plans. The overall cost  of  the  stay
bonus plans is estimated at $1,900, and is being accrued over the
periods  necessary  to achieve shut down and transfer.  The  stay
bonus  plans  generally require the employee remain  until  their
position is eliminated to earn the payment.

      In  the  second half of 1996 the USPD's management  actions
were  adjusted for the sale of the Able tablet business. The sale
of  the  Able tablet business and sub-lease of the Able  facility
(located in New Jersey) resulted in the Company reducing  certain
accruals  which would have been incurred in closing the facility.
The  net reduction of the second quarter charge for the sale  was
$1,400  and  included the net proceeds received on  the  sale  of
approximately  $500.  In  addition  in  1996  certain  staff  and
executives  at  USPD headquarters were terminated (15  employees)
resulting in severance of $782.

      As  a result of difficult market conditions experienced  in
1996,  the  Company's Animal Health Division "AHD"  reviewed  its
business  practices and staffing levels. As a result 33  salaried
employees were terminated or elected an early retirement program.
Concurrently office space was vacated resulting in a  charge  for
the  write  off  of  leasehold improvements  and  lease  payments
required   to   terminate  the  lease.  In  addition,   the   AHD
distribution business was reviewed and a number of minor products
were discontinued.

      A  summary of 1996 charges and expenses resulting from  the
management  actions  which are included in  cost  of  goods  sold
($1,100),  and  selling,  general  and  administrative   expenses
($17,700)follows:

Year         Description

$11,200      Severance and employee termination benefits for  all
             1996  employee  related actions  (approximately  450
             employees  are  to  be  terminated;  at   year   end
             approximately 130 employees were terminated).

  1,000      Stay bonus accrued, as earned.

  4,175      Write  off  of building, leasehold improvements  and
             machinery  and equipment. (Net of sales proceeds  of
             approximately $500 in the third quarter.)

    550      Accrual  of the non cancelable term of the operating
             leases  and estimated refurbishment costs  for  USPD
             facilities.

  1,875      Exit  costs for demolition of facilities,  clean  up
             costs and other.
 ______
$18,800

      The net after tax effect of the 1996 management actions was
a loss of approximately $12,600 or ($.58 per share).

      A  summary  of  the  liabilities set up for  severance  and
included  in  accrued  expenses is  as  follows  (including  stay
bonus):

                               1994         1995         1996
                              Actions      Actions     Actions
                                                     
Balance, December 31, 1994   $3,156                  
 1995                                                
   Accruals                               $1,748     
   Payments                 (2,782)        (463)     
   Translation and                                   
     adjustments                 32        _____
                                                     
Balance, December 31, 1995   $  406        1,285     
 1996                                                
   Accruals                                          $11,338
   Payments                   (261)      (1,270)     (2,122)
   Translation and                                   
     adjustments               (12)        _____         (2)
                                                     
Balance, December 31, 1996   $  133       $   15     $ 9,214

4.   Business and Product Line Acquisitions:

      The  following acquisitions were accounted  for  under  the
purchase method and the accompanying financial statements reflect
results of operations from their respective acquisition dates.

      In  August  1995,  the  Company acquired  a  company  whose
principal  asset  was  a NADA for a feed  additive  used  in  the
treatment  and prevention of respiratory diseases in  swine.  The
cost  of  $3,000 has been allocated to intangible assets ($1,500)
and a covenant not to compete ($1,500) and will be amortized over
20 and 5 year periods, respectively.

      In  July 1994, the Company acquired the Wade Jones  Company
("Wade Jones") headquartered in Lowell, Arkansas. Wade Jones is a
major  distributor  of poultry animal health  products  and  also
manufactures and blends certain animal health products.

       The  purchase  agreement  required  a  purchase  price  of
approximately  $8,350.  In addition, the agreement  provided  for
contingent payments based on future product approvals and  market
penetration  of  such  products.  In  1996  and  1995  contingent
payments  of  $203  and  $500 were made in  accordance  with  the
purchase  agreement.  The  excess  of  purchase  price  over  the
underlying estimated fair value of net assets acquired  is  being
amortized over 20 years.

      Contingent payments are included in intangible assets  when
earned and amortized over their remaining life.

5.   Accounts receivable, net:

     Accounts receivable consist of the following:

                                             December 31,
                                          1996          1995
                                                    
     Accounts receivable, trade       $113,577      $133,540
     Federal and state income                       
      taxes receivable                   7,194           -
     Other                               4,139         4,372
                                       124,910       137,912
     Less allowances for doubtful                   
      accounts                           4,359         5,751
     Accounts receivable, net         $120,551      $132,161

      The  allowance  for doubtful accounts for the  three  years
ended December 31, consisted of the following:

                             1996          1995         1994
                                                    
Balance at January 1,     $5,751         $4,897       $2,983
Provision for doubtful                              
     accounts              3,572          2,166        1,861
Reductions for accounts                             
 written off             (4,589)        (1,117)        (208)
Translation and other      (375)          (195)          261
Balance at December 31,   $4,359         $5,751       $4,897

6.   Inventories:

     Inventories consist of the following:

                                         December 31,
                                      1996          1995

     Finished product               $ 69,629      $ 68,529
     Work-in-process                  17,126        16,697
     Raw materials                    36,830        34,858
                                    $123,585      $120,084

      At  December 31, 1996 and 1995, approximately  $49,000  and
$50,800 of inventories, respectively, are valued on a LIFO basis.
Such  amounts are (lower) than the FIFO basis by $(774)  in  1996
and $(321) in 1995.
7.   Property, Plant and Equipment:

      Property,  plant  and equipment, at cost,  consist  of  the
following:

                                           December 31,
                                       1996         1995

     Land                            $ 10,221     $10,040
     Buildings and building
       improvements                   104,463      97,649
     Machinery and equipment          222,911     216,728
     Construction in progress          12,011      11,763
                                      349,606     336,180
     Less, accumulated depreciation   139,803     124,004

                                     $209,803    $212,176

8.   Long-Term Debt:

     Long-term debt consists of the following:

                                          December 31,
                                       1996          1995

     U.S. Dollar Denominated:
      1994 Credit Facility
       Term Loan A - 6.8%           $ 61,750      $ 65,000
       Term Loan B - 7.2%             68,400        72,000
       Revolving Credit - 6.8%        33,000        18,000
      A/S Eksportfinans                9,000         9,000
      Lincolnton acquisition note        -           1,500
      Industrial Development Revenue
       Bonds:
         Baltimore County, Maryland
          (7.25%)                      5,705         6,220
          (6.875%)                     1,200         1,200
         Lincoln County, NC            5,500         6,000
      Other, U.S.                      1,390         1,919

     Denominated in Other Currencies:
      Mortgage notes payable (NOK)    30,911        33,571
      Bank and agency development
       loans (NOK)                    21,362        17,345
      Other, foreign                     529           856
                                     238,747       232,611
      Less, current maturities         4,966        13,160

                                    $233,781      $219,451

      In  September  1994, the Company signed a  $185,000  credit
agreement  ("1994  Credit Facility") with a consortium  of  banks
arranged by the Union Bank of Norway and Den norske Bank A.S. The
agreement   provided   for   the   refinancing   of   outstanding
indebtedness, the acquisition of Alpharma Oslo (including related
transaction  costs, fees and expenses)(Note 3)  and  for  general
corporate purposes.

     The 1994 Credit Facility provided for the loans as follows:

                 Term Loan       Term Loan     Revolving Credit
                    (A)             (B)           Facility

Maximum Amount   $65,000         $72,000          $48,000

Term             7 years         5 years        4 years 3 months

Interest Rate    Eurodollar      Eurodollar     Eurodollar rate
 (Variable)      rate plus       rate plus        plus 1.0% (2)
                 1.25% (1)(2)    1.125%(2)

Amount  of       5% to 9% of    5% to  10%  of  Revolving
  repayment      loan amount     loan amount    100% at
                 per year        per year       maturity
                 commencing in   commencing in  subject to
                 1996 and 30%    1996 and 55%   extension
                 at final        at final
                 maturity        maturity

      (1) The interest rate was fixed at 5.655% plus 1.25% by the
use of an interest rate swap through October 1998. (See Note 17.)

     (2) Margin rate, in effect, at next interest fixing date.

      The  1994  Credit Facility has several financial covenants,
including an interest coverage ratio, minimum capital, and equity
to  asset  ratio.  During  1996,  as  a  result  of  insufficient
operating  income  as  compared to interest expense  the  Company
requested  and received a waiver of the interest coverage  ratio.
In  February 1997, the Company and syndicate banks agreed to  and
signed an amendment to the 1994 Credit Facility providing for:

      (1)   The  conversion  of Term Loan (A)  and  (B)  and  the
existing  revolving  credit  into an overall  revolving  $170,000
Credit   Facility  ("1996  Credit  Facility")  with  an   initial
expiration  of August 28, 2000. The 1996 Credit Facility  may  be
extended annually upon approval of the syndicate banks.

     (2)  Interest on the facility will be at the Eurodollar rate
with a margin of 1.125% to 1.25%.

      (3)   Modification  of  the  calculation  of  the  Interest
Coverage ratio for 1997 to include only 1997 operating income and
interest expense.

      (4)  Modification of the definition of net worth to include
the  irrevocable stock subscription by A.L. Industrier. (See Note
21.)

      In December 1995, the Company's Danish subsidiary A/S Dumex
borrowed  $9,000  from  A/S  Eksportfinans  with  credit  support
provided  by  Union  Bank  of Norway  and  Bikuben  Girobank  A/S
("Bikuben")   to   finance  an  expansion   of   its   Vancomycin
manufacturing  facility in Copenhagen. The term of  the  loan  is
seven   years.   Repayment  will  be  made  in  ten   semi-annual
installments  of  $900 beginning in March  23,  1998  and  ending
September  22,  2002  Interest for the loan is  fixed  at  6.59%,
including  the cost of the credit support provided via  guarantee
by Union Bank of Norway and Bikuben.

      The  Baltimore County Industrial Development Revenue  Bonds
are  payable in varying amounts through 2009. Plant and equipment
with  an approximate net book value of $13,200 collateralize  the
Baltimore County Industrial Revenue Bonds.

      In  August  1994, the Company issued Industrial Development
Revenue Bonds for $6,000 in connection with the expansion of  the
Lincolnton,  North  Carolina plant.  The  bonds  require  monthly
interest payments at a floating rate (4.45% at December 31, 1996;
3.672%  cumulative  weighted average for 1996) approximating  the
current money market rate on tax exempt bonds and the payment  by
the Company of annual letter of credit, remarketing, trustee, and
rating  agency fees of 1.125%. The bonds require a yearly sinking
fund  redemption of $500 from August 1996 to August 2004 and $300
thereafter  through  August 2009. Plant  and  equipment  with  an
approximate  net  book value of $10,700 serve as  collateral  for
this loan.

      The  mortgage notes payable denominated in Norwegian Kroner
(NOK)  were originally issued in connection with the construction
of   a   pharmaceutical  facility  in  Lier,   Norway   and   are
collateralized  by this facility (net book value  of  $36,850  at
December 31, 1996) and the Oslo, Norway ("Skoyen") facility. (See
Note 13.) The debt was borrowed in a number of tranches over  the
construction  period and interest is fixed for specified  periods
based  on  actual yields of Norgeskreditt publicly  traded  bonds
plus  a  lending  margin of 0.70%. The weighted average  interest
rate   at  December  31,  1996  and  1995  was  6.1%  and   8.8%,
respectively.   The   tranches  are   repayable   in   semiannual
installments  through 2021.  Yearly amounts payable vary  between
$1,239 and $2,005.

      Alpharma Oslo has various loans with government development
agencies  and  banks  which have been used for  acquisitions  and
construction  projects.  Such loans  are  collateralized  by  the
Skoyen property and require semiannual payments in 1997 and  1998
of  $1,043 and $1,597 and a final payment of $8,636 in 1999.  The
weighted average interest rate of the loans at December 31,  1996
and  1995 was 6.1% and 6.4%, respectively. The banks and agencies
have the option to extend payment in 1999.

      As  of  December 31, 1996, Alpharma Oslo had  approximately
$1,549  available in NOK in three year line of credit  agreements
with  two  banks. The credit lines require certain  equity,  cash
flow  and  quick ratios, as defined, be maintained.  Certain  NOK
loans have loan covenants which apply directly to Alpharma Oslo.

      Maturities of long-term debt during each of the  next  five
years and thereafter are as follows:

          Year ending December 31,

                    1997           $4,966
                    1998            7,505
                    1999           22,136
                    2000          167,430
                    2001            4,319
                    Thereafter          32,391
                                 $238,747

9.   Short-Term Debt:

     Short-term debt consists of the following:

                                  December 31,
                                1996      1995

               Domestic       $41,760   $48,240
               Foreign         19,192    14,455
                              $60,952   $62,695

       At  December  31,  1996,  the  Company  and  its  domestic
subsidiaries  have  available  bank  lines  of  credit   totaling
$60,000.   Borrowings  under these lines  are  made  for  periods
generally less than three months and bear interest from 6.45%  to
6.69% at December 31, 1996.  At December 31, 1996, the amount  of
the unused lines totaled $18,240.

      At  December  31, 1996, the Company's foreign  subsidiaries
have  available  lines  of  credit with  various  banks  totaling
$27,420($24,544  in Europe and $2,876 in the Far East).  Drawings
under  these lines are made for periods generally less than three
months  and  bear interest at December 31, 1996 at rates  ranging
from  3.90%  to  8.0%. At December 31, 1996, the  amount  of  the
unused  lines totaled $8,228($5,352 in Europe and $2,876  in  the
Far East).

     The weighted average interest rate on short-term debt during
the   years  1996,  1995  and  1994  was  6.2%,  6.6%  and  5.9%,
respectively.

10.  Income Taxes:

      Domestic and foreign income (loss) before income taxes  was
$(17,991), and $1,765, respectively in 1996, $17,548 and $12,680,
respectively in 1995, and $158 and $1,578, respectively in  1994.
Taxes  on income of foreign subsidiaries are provided at the  tax
rates  applicable to their respective foreign tax  jurisdictions.
The provision for income taxes consists of the following:

                                    Years Ended December 31,
                                      1996     1995      1994
          Current:
            Federal                $(4,796)  $ 6,009   $6,246
            Foreign                  3,367     3,074    1,389
            State                     (232)    1,274    1,310
                                   $(1,661)  $10,357    8,945

          Deferred:
            Federal                   (522)      (27)  (5,018)
            Foreign                 (2,531)      958      142
            State                      (51)      123     (630)
                                    (3,104)    1,054   (5,506)
             Provision/(benefit)
              for income taxes     $(4,765)  $11,411   $3,439

     A reconciliation of the statutory U.S. federal income tax
 rate to the effective rate follows:

                                    Years Ended December 31,
                                    1996      1995      1994

Provision for income taxes at
  statutory rate                   (35.0%)    35.0%     35.0%
State income tax, net of federal
  tax benefit                       (1.1%)     3.0%     25.5%
Higher (lower) taxes on foreign
    earnings,   net                 (2.7%)    (2.6%)    14.2%
Tax credits                         (0.9%)    (1.3%)    (0.1%)
Non-deductible costs, principally
  depreciation and amortization
  related to acquired companies      8.5%      3.9%     78.1%
Capitalized combination costs                           49.4%
Other                                1.8%    (  .2%)    (4.0%)
     Provision/(benefit)
      for income taxes             (29.4%)    37.8%    198.1%
      Deferred  tax  liabilities (assets) are  comprised  of  the
following:
                                                 Year Ended
                                                December 31,
                                               1996     1995

Accelerated depreciation and amortization
    for   income  tax  purposes              $23,949   $24,637
Excess of book basis of acquired assets
  over tax bases                               8,815     9,308
Differences between inventory valuation
  methods used for book and tax purposes
  (Denmark)                                    3,410     2,887
Other                                          1,147     1,462
Gross   deferred   tax   liabilities          37,321    38,294

Accrued liabilities and other reserves        (8,791)   (7,245)
Pension liabilities                           (1,408)   (1,321)
Loss carryforwards                            (2,628)   (2,093)
Other                                         (2,796)   (2,666)
Gross   deferred   tax  assets               (15,623)  (13,325)

Deferred tax assets valuation allowance        2,628     2,093

     Net deferred tax liabilities            $24,326   $27,062

      As  of  December  31,  1996, the  Company  has  state  loss
carryforwards  in one state of approximately $15,350,  which  are
available  to  offset future taxable income. These  carryforwards
will expire between the years 1999 and 2003. The Company also has
foreign  loss  carryforwards in one country as  of  December  31,
1996,  of  approximately $4,200, which are  available  to  offset
future taxable income, and have an unlimited carryforward period.
The Company has recognized a deferred tax asset relating to these
carryforwards; however, based on analysis of current information,
which indicated that it is not likely that such state and foreign
losses   will  be  realized,  a  valuation  allowance  has   been
established for the entire amount of these carryforwards.

11.  Pension Plans:

Domestic:

      Prior to July 1, 1994, the Company maintained two qualified
noncontributory, defined benefit pension plans ("Corporate  Plan"
and  "Subsidiary  Plan") covering the majority  of  its  domestic
employees.  Effective  July  1, 1994,  the  Company  amended  the
Corporate Plan to include certain subsidiary employees and merged
the  Subsidiary  Plan into the Corporate Plan. The  benefits  are
based  on years of service and the employee's compensation during
the  last five years of service. The Company's funding policy  is
to contribute annually an amount that can be deducted for federal
income  tax  purposes. During 1995 the Company  consolidated  its
Plan  assets  under  a single custodian and a  single  investment
manager.   Plan  assets  are  invested  in  equities,  government
securities and bonds.

      Net  pension  cost  for 1996, 1995 and  1994  included  the
following components:

                                Years Ended December 31,
                                 1996     1995     1994

Service cost                   $1,339    $1,049   $1,047
Interest cost                     974      874      856
Actual return on plan assets   (1,499)   (1,434)     105
Net amortization and deferral     610       957     (502)
                               $1,424    $1,446   $1,506

      The following tables set forth the plan's funded status  as
of December 31, 1996 and 1995:

                                       1996          1995

Accumulated benefit obligation:
     Vested                          $ 6,658       $ 7,549
     Nonvested                         1,132         1,196
                                     $ 7,790       $ 8,745

Projected benefit obligation         $11,457       $12,827
Fair value of plan assets            (11,276)       (9,972)
Unrecognized net loss                 (1,344)       (4,014)
Unrecognized prior service cost        1,338         1,439
Unrecognized net transition
  obligation                            (214)         (244)

 Accrued (prepaid) pension costs     $   (39)      $    36

The assumptions used were as follows:

                                   1996      1995      1994

Weighted average discount rate     7.75%     7.25%     8.5%

Rate of increase in compensation
  rate                             4.0%      4.0%      5.0%

Expected long-term rate of return
  on plan assets                   9.0%      8.0%      8.0%


     In addition, the Company has unfunded supplemental executive
pension  plans  providing additional benefits  to  a  few  highly
compensated  employees.  For 1996, 1995  and  1994  such  pension
expense was approximately $61, $65 and $60, respectively and  the
year end accrual at December 31, 1996 and 1995 was $208 and $180,
respectively.

     The Company and its domestic subsidiaries also have a number
of  defined contribution plans, both qualified and non-qualified,
which allow eligible employees to withhold a fixed percentage  of
their  salary (maximum 15%) and provide for a Company match based
on  service  (maximum 6%). The Company's contributions  to  these
plans  were  approximately $1,300, $1,200 and $700 in 1996,  1995
and 1994, respectively.

Europe:

      Alpharma  Oslo  has defined benefit plans which  cover  the
majority  of its employees. These pension commitments are  funded
through a collective agreement with a Norwegian insurance company
and  Alpharma  Oslo makes annual contributions  to  the  plan  in
accordance with Norwegian insurance principles and practices.  In
addition   to  the  annual  premiums,  Alpharma  Oslo  has   made
prepayments  to specific premium funds. These premium  funds  are
used  to cover ordinary future annual premiums. The pension  plan
assets  are deposited in the insurance company's general  account
which is principally invested in fixed income securities.

      Alpharma  Oslo also maintains a direct pension  arrangement
with certain employees. These pension commitments are paid out of
general assets and the obligations are accrued but not prefunded.

Net  pension cost for 1996, 1995 and 1994 included the  following
components:

                                   1996      1995      1994

Service cost                      $1,302    $  954    $1,009
Interest cost                      1,027       993       766
Actual return on plan assets     (1,032)     (456)     (340)
Net amortization and deferral        413      (66)     (178)
                                  $1,710    $1,425    $1,257
The  following tables set forth the plans' funded  status  as  of
December 31, 1996 and 1995:


                           Assets Exceed        Accumulated
                            Accumulated           Benefits
                              Benefits         Exceed Assets
                          1996      1995       1996    1995
Accumulated benefit
  obligation:
    Vested              $10,587   $ 9,195    $1,361 $ 1,376
    Nonvested             1,530       140     _____   ______
                        $12,117   $ 9,335    $1,361  $ 1,376

Projected benefit
  obligation            $16,871   $14,468    $1,361  $ 1,422
Fair value of plan
  assets               (11,738)  (10,298)
Unrecognized net gain
  (loss)                    970     1,893         8      (40)
Unrecognized prior
  service cost            (803)     (868)     (348)    (426)
Unrecognized net
  transition obligation (1,264)   (1,398)      (28)     (33)
Additional minimum
  liability               _____    ______       368      454

Accrued pension costs   $ 4,036   $ 3,797    $1,361  $ 1,377

The assumptions used were as follows:

                                   1996      1995      1994

Weighted average discount rate     7.0%      7.0%      7.0%

Rate of increase in compensation
  rate                             3.5%      3.5%      3.5%

Expected long-term rate of return
  on plan assets                   7.0%      7.0%      7.0%

      The  Company's  Danish subsidiary,  Dumex,  has  a  defined
contribution pension plan for salaried employees. Under the plan,
the  Company contributes a percentage of each salaried employee's
compensation to an account which is administered by an  insurance
company. Pension expense under the plan was approximately $2,250,
$2,400 and $1,900 in 1996, 1995 and 1994, respectively.

12.  Postretirement Benefits:

      The  Company  has  an unfunded postretirement  medical  and
nominal  life insurance plan covering certain domestic  employees
included  in the Corporate Plan as of January 1, 1993.  The  plan
will  not  be  extended  to  any  additional  employees.  Retired
employees are required to contribute for coverage as if they were
active employees.

      The Company adopted SFAS 106 on January 1, 1993 and elected
to   recognize  the  change  on  a  delayed  recognition   basis.
Accordingly,  the  transition  obligation  of  $1,079   will   be
amortized   over  twenty  years.  The  discount  rate   used   in
determining the 1996, 1995 and 1994 expense was 7.25%, 8.5%,  and
7.25%,  respectively. The discount rate used in  determining  the
accumulated  post retirement obligation as of December  31,  1996
and  1995 was 7.75% and 7.25%, respectively. The health care cost
trend  rate  was 8.0% declining to 5.0% over a ten  year  period,
remaining level thereafter.

      The  unfunded plan is recognized at December 31,  1996  and
1995 as follows:

                                                1996      1995

Accumulated postretirement benefit obligation

  Retirees                                    $1,789      $ 579
  Fully eligible active participants                        191
  Other active participants                      958      1,276
                                               2,747      2,046
Unrecognized estimated net (loss) gain         (526)      (500)
Unrecognized transition obligation             (863)      (917)

  Accrued postretirement benefit cost         $1,358     $  629

     In 1996 the Company's AHD announced an early retirement plan
for  employees  meeting certain criteria. As  part  of  the  plan
employees  electing early retirement would be eligible  for  post
retirement medical even if they had not met the required  service
and  age  requirements.  The charge for the  special  termination
benefits of $492 was required and is included in the accrued post
retirement benefit cost.

      The  net periodic postretirement benefit cost included  the
following components.
                                         1996    1995   1994

          Service cost                   $120   $ 101   $102
          Interest cost                   146     127     97
          Amortization of:
            Transition obligation          54      54     54
            Unrecognized loss              17     ___    ___
                                         $337    $282   $253
13.  Transactions With A. L. Industrier:

                                  Years Ended December 31,
                                   1996      1995     1994

Sales to and commissions received
  from A.L. Industrier           $3,075     $3,353   $2,805

Compensation received for
  management services rendered to
  A.L. Industrier                $  464     $  630   $  854

Inventory purchased from and
  commissions paid to A.L.
  Industrier                     $  200     $  214   $  291

Net interest received from A.L.
  Industrier                        -          -     $  401

      As  of  December 31, 1996 and 1995 there was a net  current
receivable of $764 and $702, respectively, from A.L. Industrier.

      The  Company  and  A.L. Industrier have  an  administrative
service  agreement  whereby the Company is  required  to  provide
management  services  to A.L. Industrier  with  an  initial  term
through January 1, 1997. The agreement provides for payment equal
to the direct and indirect cost of providing the services subject
to  a  minimum amount in the initial term. The agreement has been
extended  after the initial term and may be terminated by  either
party upon six months notice.

      In  addition, in connection with the agreement to  purchase
Alpharma  Oslo,  A.L. Industrier retained the  ownership  of  the
Skoyen  manufacturing  facility and administrative  offices  (not
including leasehold improvements and manufacturing equipment) and
leases  it to the Company. The agreement also permits the Company
to  use  the Skoyen facility as collateral on existing  debt  for
five  years.  The Company is required to pay all expenses related
to  the operation and maintenance of the facility in addition  to
nominal  rent.  The  lease has an initial 20  year  term  and  is
renewable  at  the then fair rental value at the  option  of  the
Company for four consecutive five year terms.

14.  Contingent Liabilities, Litigation and Commitments:

      The  Company and its subsidiaries are, from time  to  time,
involved  in  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 pending suits should
not  have a material adverse effect on the consolidated financial
position of the Company.

      In  connection  with a 1991 product line  acquisition,  the
Company  entered  into a ten-year manufacturing  agreement  which
requires  the  Company to purchase a yearly minimum  quantity  of
feed  additives  on a cost-plus basis. If the minimum  quantities
are  not  purchased, the Company must reimburse  the  supplier  a
percentage   of  the  fixed  costs  related  to  the  unpurchased
quantities.  The current cost of the yearly minimum  quantity  is
approximately  $7,000 and the fixed cost portion is approximately
20%.   For  1996  and prior years, the Company has  purchased  in
excess of the minimum quantities.


15. Leases:

      Rental  expense under operating leases for 1996,  1995  and
1994  was $6,578, $5,574 and $5,313, respectively. Future minimum
lease  commitments under non-cancelable operating  leases  during
each of the next five years and thereafter are as follows:

     Year Ending December 31,

                       1997       $ 4,700
                       1998         5,200
                       1999         4,200
                       2000         3,800
                       2001         2,400
                       Thereafter   7,400
                                  $27,700

16.  Stockholders' Equity:

      The holders of the Company's Class B Common Stock, (totally
held  by  A. L. Industrier at December 31, 1996) are entitled  to
elect  66 2/3% of the Board of Directors of the Company  and  may
convert  each share of Class B Common Stock held into  one  fully
paid  share of Class A Common Stock. Whenever the holders of  the
Company's common stock are entitled to vote as a combined  class,
each  holder  of Class A and Class B Common Stock is entitled  to
one and four votes, respectively, for each share held.

      In  connection  with the acquisition of Alpharma  Oslo  the
Company  issued warrants to purchase 3,600,000 shares of Class  A
Common  stock  for  $21.945 per share through  January  3,  1999.
Warrants  to  purchase  2,450,246 shares  became  exercisable  in
October  1995 with the balance to become exercisable  in  October
1997. (See Note 3.)

      The  number  of  authorized shares of  Preferred  Stock  is
500,000; the number of authorized shares of Class A Common  Stock
is  40,000,000; and the number of authorized shares  of  Class  B
Common Stock is 15,000,000.
17.  Derivatives and Fair Value of Financial Instruments:

       The   Company  currently  uses  the  following  derivative
financial instruments for purposes other than trading.

Derivative             Use              Purpose

Forward foreign        Occasional       Entered into selectively
exchange contracts                      to sell or buy cash flows
                                        in non-functional
                                        currencies.
Interest rate          Occasional       Entered into selectively
agreements                              to fix interest rate for
                                        specified periods on
                                        variable rate long-term
                                        debt.
                                        
      At  December  31,  1996  and 1995, the  Company's  European
subsidiaries  had foreign currency contracts outstanding  with  a
notional amount of approximately $8,100 and $8,000, respectively.
These  contracts  called  for the exchange  of  Scandinavian  and
European  currencies and in some cases the U.S.  Dollar  to  meet
commitments  in  or  sell cash flows generated in  non-functional
currencies.  All outstanding contracts will expire by January 30,
1997.

     In November 1995, the Company entered into two interest rate
swap agreements with two members of the consortium of banks which
are  parties to the 1994 Credit Facility to reduce the impact  of
changes in interest rates on a portion of its floating rate long-
term  debt. The swap agreements fix the interest rate  at  5.655%
plus 1.25% for term loan A ($61,750 at December 31, 1996) through
October 1998. (See Note 8.)

      Counterparties to derivative agreements are major financial
institutions.  Management believes the risk of  incurring  losses
related to credit risk is remote.

      The  carrying  amount reported in the consolidated  balance
sheets  for  cash  and  cash  equivalents,  accounts  receivable,
accounts  payable  and  short-term debt approximates  fair  value
because  of  the  immediate  or  short-term  maturity  of   these
financial instruments. The carrying amount reported for long-term
debt approximates fair value because a significant portion of the
underlying debt is at variable rates and reprices frequently.

18.  Stock Options and Employee Stock Purchase Plan:

      Under  the Company's 1983 Incentive Stock Option  Plan,  as
amended  (the  "Plan"),  the Company may  grant  options  to  key
employees  to  purchase shares of Class A Common Stock.  In  June
1995  the  Company's  stockholders  approved  an  increase,  from
1,650,000 to 2,500,000, in the maximum number of shares available
for  grant.  The exercise price of options granted under the Plan
may not be less than 100% of the fair market value of the Class A
Common  Stock  on the date of the grant. Generally,  options  are
exercisable in installments of 25% beginning one year  from  date
of  grant.  The  Plan  permits a cash appreciation  right  to  be
granted to certain employees. This right must be exercised at the
same  time  the stock option is exercised and is limited  to  one
half  of the total number of shares being exercised. Included  in
options  outstanding at December 31, 1996 are options to purchase
1,875  shares  with cash appreciation rights, all  of  which  are
exercisable. If an option holder ceases to be an employee of  the
Company  or  its subsidiaries for any reason prior to vesting  of
any  options,  all options which are not vested at  the  date  of
termination  are  forfeited. As of December 31,  1996  and  1995,
options  for  873,748  and  881,748  shares,  respectively,  were
available for future grant.

The table below summarizes the activity of the Plan:

                               Shares         Option       Shares
                               Outstanding    Price        Exercisable

Balance at December 31, 1993    489,900  $ 4.58  - $27.13   226,155
  Granted in 1994               207,000  $13.50  - $16.87
  Canceled in 1994              (23,625) $ 8.75  - $23.13
  Exercised in 1994             ( 1,700) $ 8.75  - $ 8.75

Balance at December 31, 1994    671,575  $ 4.58  - $27.13   319,703
  Granted in 1995               308,500  $18.38  - $18.75
  Canceled in 1995              (40,875) $13.50  - $26.25
  Exercised in 1995             (42,425) $ 6.58  - $22.13

Balance at December 31, 1995    896,775                     383,278
 Granted in 1996                 44,000  $12,25  - $25.00
 Canceled in 1996               (36,000) $13.50  - $22.13
 Exercised in 1996              (66,437)  $ 4.58  - $22.13

Balance at December 31, 1996    838,338                     444,982

      As  indicated  in  Note  2  the  Company  has  adopted  the
disclosure  only provisions of SFAS No. 123. If the  Company  had
elected  to recognize compensation costs in accordance with  SFAS
No.  123  the  reported net income (loss) and income  (loss)  per
share  for  1995  and  1996, respectively  would  not  have  been
materially  affected. The effects of applying the  Statement  for
the required periods may not be representative of the effects  on
future years.
      The  Company estimated the fair value, as of  the  date  of
grant, of options outstanding in the plan using the Black-Scholes
option pricing model with the following assumptions:

                                        1996        1995

     Expected life                   4-5 years    4-5 years
     Risk free interest rate           5.96%        5.06%
     Expected future dividend yield    1.23%        0.67%
     Expected volatility               0.35         0.35

      The  weighted average remaining contractual life of options
outstanding  is  6  and 7 years at December 31,  1996  and  1995,
respectively.

      The  Company has an Employee Stock Purchase Plan  by  which
eligible  employees of the Company and its domestic  subsidiaries
may  authorize payroll deductions up to 4% of their regular  base
salary  to  purchase shares of Class A Common Stock at  the  fair
market  value.  The Company matches these contributions  with  an
additional   contribution  equal  to  25%   of   the   employee's
contribution. Shares are issued on the last day of each  calendar
quarter.   The   Company's  contributions  to   the   plan   were
approximately  $163,  $155  and $156  in  1996,  1995  and  1994,
respectively.


19.  Supplemental Data:
                                       Years Ended December 31,
                                     1996      1995      1994
Research and development
    expense                         $34,269  $32,815   $32,497*
   Depreciation expense              22,751   22,085    18,342
   Amortization expense               8,752    8,937     8,431
     Interest   cost  incurred       20,549   22,311    16,077
   Other income (expense) net:
       Interest   income                529      711     1,432
     Foreign exchange gains
       (losses), net                   (195)    (854)      (34)
       Other,   net                    (504)    (117)     (285)
                                    $  (170) $  (260)  $ 1,113

      *  Includes $2,500 for contractually required payments  for
Research and Development paid on an accelerated basis in December
1994. (See Note 3.)
   Supplemental cash flow information:

   Cash paid for interest
    (net of amount capitalized)    $20,250   $19,812   $15,687
   Cash paid for income taxes        9,182     8,223     9,228

   Supplemental schedule of
     noncash investing and
     financing activities:

   Warrants issued                                     $ 6,552

   Fair value of assets acquired             $ 3,500   $19,437
   Cash paid                                   3,500    13,733
   Liabilities assumed                       $     0   $ 5,704
20.   Information  Concerning Business  Segments  and  Geographic
Operations:

      The  Company currently conducts its business operations  in
two  business segments: (1) Human Pharmaceuticals and (2)  Animal
Health.   The Human Pharmaceuticals business includes  the  USPD,
IPD  and FCD.  The Animal Health business consists of the AHD and
AAHD.   The  Company's operations outside the United  States  are
conducted  primarily  in  Europe by the  Company's  manufacturing
subsidiaries in Norway and Denmark.

                                                 Depre-
                                                 ciation
                                                  and
                                        Identi-  Amorti-   Capital
                    Total    Operating  fiable   zation    Expendi-
                   Revenue    Income(1) Assets   Expense    tures
1996
Business segments:
Human
 Pharmaceuticals   $328,724  $(8,216)   $446,528  $23,013  $15,747
Animal Health       158,254    17,924    137,867    7,771   12,783
Unallocated             698   (5,521)     29,012      719    2,344
Eliminations        (1,492)     (267)    _______   ______   ______
                  $486,184    $3,920   $613,407  $31,503  $30,874

Geographic:
United States      $294,252  $(3,522)   $355,432
Europe and Other    221,872     8,133    257,975
Eliminations       (29,940)     (691)    _______
                  $486,184    $3,920   $613,407

   1995
Business segments:
 Human
  Pharmaceuticals   $358,392  $26,115   $476,738  $23,375   $15,708
 Animal Health       163,322   30,839    140,860    7,406     8,720
 Unallocated             407   (4,445)    17,255      241       408
 Eliminations         (1,239)     (28)   _______   ______    ______
                   $520,882  $52,481   $634,853  $31,022   $24,836
Geographic:

 United States      $328,491  $32,799   $376,134
 Europe and Other    219,970   20,327    260,510
 Eliminations        (27,579)    (645)    (1,791)
                    $520,882  $52,481   $634,853
   1994
Business segments:
 Human
  Pharmaceuticals   $329,113  $(3,850)  $454,685  $20,900   $25,201
 Animal Health       141,077   28,532    122,804    5,657    18,134
 Unallocated             615   (8,708)    14,829      216       991
 Eliminations         (1,542)       4
                   $469,263  $15,978   $592,318  $26,773   $44,326

Geographic:

 United States      $303,270  $ 6,774   $362,359
 Europe and Other    179,714    9,180    230,722
 Eliminations        (13,721)      24       (763)
                   $469,263  $15,978   $592,318

1.  1994 operating income includes charges for management actions
related  to  the  acquisition of Alpharma  Oslo  and  transaction
expenses.  1996 and 1995 operating income includes  (income)  and
charges  for  additional  management actions.  The  segments  are
impacted as follows:

                              1996         1995          1994
                                                     
Human Pharmaceuticals      $13,789       $(639)      $19,000
Animal Health                4,542          480        1,950
Unallocated                    469          ____       3,700
                           $18,800       $(159)      $24,650


21. Subsequent  Event  -  Class B Common Stock  Subscription  and
    Planned Class A Rights Offering

     On February 10, 1997, the Company announced the signing of a
stock  subscription and purchase agreement with  A.L.  Industrier
whereby   A.L.  Industrier  irrevocably  subscribed  to  purchase
1,273,438  shares  of Class B Common Stock for $16.34  per  share
(total proceeds $20,808). Concurrently the Company announced that
Class  A  shareholders would be issued special rights to purchase
one  share of Class A Common Stock for $16.34 per share for every
six  shares of Class A Common currently held. (Potential proceeds
of  approximately $34,000.) If the Class A rights  are  exercised
the  current  ownership proportion between  the  Class  A  and  B
shareholders would be maintained. The distribution of the  rights
will  be  made  with a prospectus. The final details,  terms  and
conditions  of the rights have not been finalized,  however  they
are expected to be transferable and have a term expiring no later
than  November 30, 1997. A.L. Industrier's purchase  of  Class  B
Common  Stock will occur upon termination of the Class A  rights,
but  is  not  conditioned on the exercise of any of the  Class  A
rights.

     Upon  issuance of the Class A rights, the exercise price  of
the  3,600,000 warrants outstanding ($21.945 per share)  will  be
adjusted pursuant to the warrant agreement. (Note 16.)

22.  Selected Quarterly Financial Data (unaudited):

                                    Quarter                 
                                                              Total
1996                 First     Second    Third     Fourth     Year
                                                            
Total revenue       $127,810  $121,219  $122,438   $114,717  $486,184
                                                                    
Gross profit          54,519    49,757    48,388     36,392   189,056
                                             
Net                    4,777    (4,502)       29    (11,765)  (11,461)
income(loss)(c)                       
                                                            
Earnings per                                                
common share:
 Primary                                                    
 Net income (loss)       .21      (.20)    .00        (.54)     (.53)
                                        
 Fully diluted                                              
 Net income (loss)       .21      (.20)   .00         (.54)     (.53)
                                        
                                                            
1995                                                        
                                                            
Total revenue       $126,080  $123,817  $132,375   $138,610  $520,882
                                        
                                                            
Gross profit          52,669    52,424    52,123     61,539   218,755
                                       
                                                            
Net income (a)         3,925     3,054     6,169      5,669    18,817
                                        
                                                            
Earnings per                                                
  common share      
 Primary                                                    
  Net income(loss)       .18       .14     .28         .26       .86
                                        
 Fully diluted                                              
  Net income (b)         .18       .14     .28         .25       .84
                                        


 (a)       The  third  quarter of 1995 includes post-combination
    management  actions  which increased net  income  by  $1,754
    ($.08  per share). Actions included pre-tax income from  the
    sale of an equity interest in an R&D company $6,463 less pre-
    tax   expenses  of  $3,634  for  severance  and  substantial
    consulting expenses.

    The   fourth   quarter  of  1995  includes  post-combination
    management actions which reduced net income by $1,776  ($.08
    per  share). Actions included pre-tax expenses of $2,670 for
    severance and consulting. (See Note 3.)

(b) The sum of the fully diluted earnings per share for the four
    quarters  in 1995 does not equal the total for the year  due
    to the dilutive effect of the Company's warrants on the full
    year computation.

(c) The  quarters  of  1996  include  management  actions  which
    reduced income as follows:

                                                     Loss per
                            Pre-tax     After-tax     share
                                                    
    First quarter         $1,900         $1,200     $ (.05)
    Second quarter        12,100          7,500       (.34)
    Fourth quarter         4,800          3,900       (.18)
    Full year            $18,800        $12,600     $ (.58)