EXHIBIT 99.1
(ALLERGAN NEWS RELEASE)
ALLERGAN ANNOUNCES INCREASE IN Q4 AND FULL YEAR 2005 EARNINGS PER SHARE
FOLLOWING AGREEMENT WITH U.S. INTERNAL REVENUE SERVICE
IRVINE, Calif., March 3, 2006 - - Allergan, Inc. (NYSE: AGN) today announced that on March 1, 2006, after the publication of Allergan’s fourth quarter and full year earnings release but before the filing of Allergan’s 2005 Form 10-K, Allergan and the United States Internal Revenue Service entered into an agreement resolving certain tax disputes and permitting Allergan to release a valuation allowance taken in the fourth quarter of 2005 and certain tax contingencies established in prior periods. As a result of the settlement with the Internal Revenue Service and the reversal of these allowances and contingencies, the Company’s fourth quarter and full year 2005 GAAP diluted earnings per share (“EPS”) reported in the yet-to-be-filed 2005 Form 10-K will increase 13 cents from $0.90 and $2.88 as was reported in the Company’s February 2, 2006 earnings release to $1.03 and $3.01, respectively.
In the fourth quarter of 2005, Allergan determined that it was required to record a valuation allowance against a deferred tax asset associated with the 2001 acquisition of Allergan Specialty Therapeutics, Inc. (“ASTI”). After the close of the fourth quarter of 2005, but prior to the filing of Allergan’s 2005 Form 10-K, Allergan held a settlement conference with the Internal Revenue Service and negotiated a settlement with respect to the issue underlying the requirement to record the deferred tax asset valuation allowance. As a result of the settlement, Allergan determined that it is no longer required to record a valuation allowance against the deferred tax asset, which has the effect of increasing the Company’s reported GAAP diluted EPS by 9 cents. Likewise, because the Company’s current written policy for determining adjusted EPS does not contemplate an intra-quarter tax adjustment such as this, the reversal of the allowance has the effect of increasing adjusted diluted EPS by 9 cents as well. Due to this settlement, adjusted diluted EPS in 2005 grew by 23% in comparison to 2004.
Had the Company not obtained this settlement, and thus maintained the established valuation allowance, 2005 adjusted diluted EPS would have been $3.29, a 20% increase over 2004 adjusted diluted EPS; likewise, the Company’s projected 2006 EPS guidance of $3.76 to $3.82, which excludes a $0.20 negative impact related to the expensing of stock options in accordance with Statement of Financial Accounting Standards No. 123 (revised 2004), Share-Based Payment, represents a 14%-16% increase over the pre-settlement EPS number for 2005.
In addition, as part of the settlement noted above, the Company will be releasing $5.9 million of accrued reserves for income tax contingencies related to certain other related issues associated with the acquisition of ASTI. The diluted EPS impact of 4 cents for this adjustment will be reflected in the Company’s GAAP earnings reported in the 2005 Form 10-K, but will not have an impact on the Company’s adjusted diluted EPS.
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The following information was filed by Allergan Inc on Friday, March 3, 2006 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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