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

                             ___________________________________  

                                          FORM 10-Q


              ( )   Quarterly Report Pursuant to Section 13 or 15(d) of the
                              Securities Exchange Act of 1934
                    For the quarterly period ended September 30, 1995

              ( )   Transition Report Pursuant to Section 13 or 15(d) of the
                               Securities Exchange Act of 1934
                    For the transition period from _______ to _______

                                                                  

                           Commission File Number:   0-13976

                                                                  


                                         AKORN, INC.
                   (Exact Name of Registrant as Specified in its Charter)


                  LOUISIANA                                72-0717400       
          (State or Other Jurisdiction of                (I.R.S. Employer 
           Incorporation or Organization)               Identification No.)


          100 Akorn Drive
      Abita Springs, Louisiana                             70420
  (Address of Principal Executive Offices)              (Zip Code)



                                            (504) 893-9300
                          (Registrant's telephone number including area code)
                                                                  

            Indicate by  check  mark whether  the  issuer  (1) has  filed  all
            reports  required  to  be filed  by  Section 13  or  15(d) of  the
            Securities Exchange Act of 1934 during the preceding 12 months (or
            for such shorter  period that the registrant was  required to file
            such   reports),  and   (2) has  been   subject  to   such  filing
            requirements for the past 90 days.   
                  Yes  X         No        


            At October 31, 1995 there were 14,922,907 shares of common stock,
            no par value, outstanding.


<PAGE>



                             PART I.  FINANCIAL INFORMATION
                   




            Item 1.  Financial Statements (Unaudited)




            The following financial statements are provided on the page     
            numbers indicated below:


            Condensed Consolidated Balance Sheets -
            September 30, 1995 and June 30, 1995                     2


            Condensed Consolidated Statements of Income -
            Three months ended September 30, 1995 and 1994           4


            Condensed Consolidated Statements of Cash Flows -
            Three months ended September 30, 1995 and 1994           5


            Notes to Condensed Consolidated Financial 

            Statements                                               6





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

            The information called for by this item is provided on page 8.


<PAGE>

                                                   AKORN, INC.

                                        CONDENSED CONSOLIDATED BALANCE SHEETS

                                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                              September 30,              June 30,     
                                                                 1995                     1995*      
                                                          ___________________     ___________________
<S>                                                         <C>                      <C>
ASSETS


CURRENT ASSETS
  Cash and cash equivalents                                  $     954,962            $     767,286 
  Short-term investments                                         1,290,739                1,568,793 
  Accounts receivable
   (less allowance for bad debts of
    $266,455 and $266,329 at September 30
    and June 30, respectively)                                   4,880,782                4,918,753 
  Inventory                                                      6,419,281                5,979,707 
  Prepaid expenses and other assets                              1,276,113                1,068,338 
                                                           ___________________     ___________________                   
   TOTAL CURRENT ASSETS                                         14,821,877               14,302,877 

OTHER ASSETS                                                       961,403                  957,099 

PROPERTY, PLANT AND EQUIPMENT                                   17,637,086               13,820,135 
   Accumulated depreciation                                     (6,935,466)              (6,750,743)
                                                           ___________________     ___________________
                                                                10,701,620                7,069,392 
   Construction in progress                                        339,509                3,926,553 
                                                           ___________________     ___________________
                                                                11,041,129               10,995,945 
                                                           ___________________     ___________________

TOTAL ASSETS                                                 $  26,824,409            $  26,255,921
                                                           ===================     ===================
</TABLE>


<PAGE>
                 

<TABLE>
<CAPTION>

                 
                                                              September 30,              June 30,     
                                                                 1995                     1995*      
                                                          ___________________     ___________________
<S>                                                         <C>                      <C>
LIABILITIES AND SHAREHOLDERS'
EQUITY

CURRENT LIABILITIES
 Current installments of long-term debt and                                                        
  capital lease obligations                                 $     779,726            $     641,994 
 Current portion of pre-funded development costs                  667,000                  667,000 
 Trade accounts payable                                         1,990,380                1,718,893 
 Income taxes payable                                             903,883                  781,824 
 Accrued payroll and commissions                                  511,227                  625,839 
 Accrued reorganization costs                                     706,322                  727,423 
 Accrued expenses and other liabilities                         1,286,907                1,237,232 
                                                          ___________________     ___________________  
  TOTAL CURRENT LIABILITIES                                     6,845,445                6,400,205 

LONG-TERM DEBT AND                                                                                 
 CAPITAL LEASE OBLIGATIONS                                      3,695,786                3,900,389 

OTHER LONG-TERM LIABILITIES                                       874,607                  957,043 

SHAREHOLDERS' EQUITY
 Common stock, no par value--
  authorized 20,000,000 shares;
  issued 15,115,673 shares
  at September 30 and June 30; 
  outstanding 14,922,907 and 14,904,653
  shares at September 30 and June 30, respectively             13,701,845               13,701,845 
 Treasury stock, at cost--
  192,766 and 211,020 shares     
  at September 30 and June 30, respectively                      (254,559)                (291,067)
 Retained earnings                                              1,961,285                1,500,109 
 Unrealized gain on marketable equity securities                        -                  87,397 
                                                          ___________________     ___________________   
   TOTAL SHAREHOLDERS' EQUITY                                  15,408,571               14,998,284 
                                                          ___________________     ___________________


TOTAL LIABILITIES AND
    SHAREHOLDERS' EQUITY                                    $  26,824,409            $  26,255,921 
                                                          ===================     ===================
</TABLE>


*Condensed from audited consolidated financial statements.
 See notes to condensed consolidated financial statements.


                                           AKORN, INC.

                          CONDENSED CONSOLIDATED STATEMENTS OF INCOME

                                         (UNAUDITED)


<TABLE>
<CAPTION>
                                                    Three Months ended September 30,           
                                                    1995                       1994        
                                            _____________________   _______________________
<S>                                         <C>                       <C>
Net sales                                   $   7,888,548             $   8,541,126 
Cost of sales                                   5,001,214                 4,919,793 
                                            _____________________   _______________________

  GROSS PROFIT                                  2,887,334                 3,621,333 

Selling, general and
 administrative expenses                        1,937,853                 2,232,179 
Research and development                          235,300                   169,364 
                                            _____________________   _______________________
                                                2,173,153                 2,401,543 
                                            _____________________   _______________________
  OPERATING INCOME                                714,181                 1,219,790 


          
Interest expense                                  (86,565)                    -      
Interest and other income (expense)               103,828                    28,406 
                                            _____________________   _______________________
                                                   17,263                    28,406 
                                            _____________________   _______________________
   INCOME BEFORE INCOME TAXES                     731,444                 1,248,196 
           

Income taxes                                      270,634                   461,833 
                                            _____________________   _______________________

   NET INCOME                               $     460,810             $     786,363 
                                            =====================   =======================

Per Share:

                                                                                                 
   NET INCOME                               $          .03             $        .05
                                            =====================   =======================
   WEIGHTED AVERAGE 
    SHARES OUTSTANDING                          15,259,700               15,286,345 
                                            =====================   =======================

 See notes to condensed consolidated financial statements.

</TABLE>



<PAGE>
                                            AKORN, INC.

                          CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

                                           (UNAUDITED)

<TABLE>       
<CAPTION>
       
                                                                       Three Months ended September 30,           
                                                                       1995                       1994        
                                                               _____________________   _______________________
<S>                                                                   <C>                       <C>
OPERATING ACTIVITIES                                                                       
 Net income                                                      $      460,810            $    786,363 
 Adjustments to reconcile net income to net
  cash provided by (used in) operating activities:            
 Depreciation and amortization                                          199,940                 195,095 
 Gain on sale of investments                                            (79,859)                    -      
 Changes in operating assets and liabilities                           (375,673)             (1,360,763)
                                                               _____________________   _______________________
NET CASH PROVIDED BY (USED IN)
 OPERATING ACTIVITIES                                                   205,218                (379,305)

INVESTING ACTIVITIES
 Purchases of property, plant and equipment                            (229,907)             (1,338,607)
 Net maturities of investments                                          270,516                 373,874 
 Product licensing costs                                                (28,154)               (297,682)
                                                               _____________________   _______________________
NET CASH PROVIDED BY (USED IN)                 
INVESTING ACTIVITIES                                                    12,455              (1,262,415)

FINANCING ACTIVITIES
 Repayment of long-term debt                                            (32,502)               (101,875)
 Proceeds from sale of stock                                             36,874                  46,938 
 Reductions in capital lease obligations                                (34,369)                 (6,161)
 Short-term borrowings                                                      -                   225,000 
                                                               _____________________   _______________________

NET CASH PROVIDED BY (USED IN)
 FINANCING ACTIVITIES                                                   (29,997)                163,902 

INCREASE (DECREASE) IN CASH
 AND CASH EQUIVALENTS                                                   187,676              (1,477,818)
        
Cash and cash equivalents at beginning of period                        767,286               1,914,735 
                                                               _____________________   _______________________
CASH AND CASH EQUIVALENTS
 AT END OF PERIOD                                                $      954,962           $     436,917
                                                               =====================   =======================
SUPPLEMENTAL DISCLOSURE
 OF CASH FLOW INFORMATION:

Interest paid, net of amount capitalized                         $       86,061           $         -     
                                                               =====================   =======================
Income taxes paid                                                $      180,000           $     370,000

                                                               =====================   =======================

See notes to condensed consolidated financial statements.

</TABLE>


<PAGE>
                                            AKORN, INC.

                         NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

                                              (UNAUDITED)



 NOTE A - BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements include
the accounts of Akorn, Inc. (the "Company") and its wholly owned subsidiaries,
Spectrum Scientific  Pharmaceuticals, Inc. , Walnut  Pharmaceuticals, Inc. and
Akorn Manufacturing,  Inc., formerly  Taylor Pharmacal Company.   Intercompany
transactions and balances have been eliminated in consolidation.

These  financial statements  have been  prepared in accordance  with generally
accepted accounting principles for interim  financial information and with the
instructions  to  Form  10-Q.   Accordingly,  they  do  not  include  all  the
information and footnotes required by generally accepted accounting principles
for  complete financial  statements.    In  the  opinion  of  management,  all
adjustments (consisting of normal recurring accruals) considered necessary for
a fair presentation have been included.  Operating results for the three-month
period ended September  30, 1995 are not necessarily indicative of the results
that  may  be  expected for  the  year  ending June  30,  1996.    For further
information, refer  to the consolidated financial statements and footnotes for
the  year ended June 30, 1995, included in the Company's Annual Report on Form
10-KSB.

NOTE B - INCOME TAXES

The  Company is  currently in  discussions with  the Internal  Revenue Service
(IRS) regarding the  examination of tax  return for years  1988 through  1993.
The IRS  has  proposed  adjustments to  such  returns which  would  result  in
additional  taxes and interest due of approximately $1.5 million. Although the
Company does  agree with approximately  $600,000 of the  proposed adjustments,
the Company  does intend  to  appeal the  remainder of  the  assessment.   The
Company  does not currently anticipate any  adverse financial statement effect
from  this proposed assessment as accruals for the financial statement effects
of these proposed adjustments have been previously recorded.

NOTE C - EARNINGS PER SHARE

Earnings per share are based upon the weighted average number of common shares
outstanding.    The  computation of  the  weighted  average  number of  shares
outstanding  for all periods presented  includes the dilutive  effect of stock
options and warrants using the treasury stock method.  
            
NOTE D - INVENTORY

The components of inventory are as follows:
            
                                    September 30,        June 30,   
                                        1995               1995    
                                  _________________  __________________
Finished goods                     $  3,925,036       $ 3,742,411
Work in process                       1,119,867         1,042,922
Raw materials and supplies            1,374,378         1,194,374
                                  _________________  __________________
                                   $  6,419,281       $ 5,979,707
                                  =================  ==================
                                                   
The inventories are reported net of  reserves for unsaleable items of $323,765
and $344,443 as of September 30, 1995 and June 30, 1995, respectively. 

NOTE E - INVESTMENTS

At June  30,  1995,  the  market  value of  the  Company s  marketable  equity
securities exceeded the  cost by  $87,397; therefore, an  unrealized gain  was
recorded  as a component  of shareholders  equity to  reflect this increase in
value.  Subsequent to year end, the Company sold the investment and recorded a
realized gain of $79,859 during the first quarter of fiscal 1996.  This amount
is included  in interest and other  income (expense) in the  1995 statement of
income.

NOTE F - INTEREST CAPITALIZATION

Interest  incurred during construction periods  is capitalized as  part of the
cost of the  expansion project.  During the  quarters ended September 30, 1995
and 1994,  the  Company  capitalized $34,682  and  $13,434,  respectively,  in
interest costs.

NOTE G - LITIGATION

The Company is involved in various litigation and claims arising in the normal
course of business.  The Company's management  believes that any liability the
Company  may have in  these matters would  not have  a material effect  on the
consolidated financial statements. 

NOTE H - CONTINGENCIES

In April 1994, the Company entered into a series of cross-licensing agreements
with Pfizer Inc. (Pfizer), one of which provided Akorn an  exclusive, royalty-
free  license  to  manufacture and  market  an  ophthalmic  form of  a  Pfizer
prescription non-steroidal anti-inflammatory  drug (NSAID).   As part of  this
agreement, in fiscal 1994 Pfizer paid the Company an advance  of $1 million to
be used to fund  the costs of developing the  NSAID.  In the event  that Akorn
fails to obtain FDA approval on another product under development and licensed
to Pfizer (the licensed product) by December 31, 1996, the Company is required
to pay a performance  penalty of $1,020,000 to Pfizer.  A New Drug Application
(NDA) was filed  for the licensed product on June 8,  1994.  Given the current
status of the NDA, it is  management s opinion that payment of the performance
penalty is remote.


<PAGE>
                                              AKORN, INC.

 
                                MANAGEMENT'S  DISCUSSION AND ANALYSIS

                                      OF FINANCIAL CONDITION AND 
                                                   
                                         RESULTS OF OPERATIONS


RESULTS OF OPERATIONS

Net Sales

The following  table  sets forth,  for  the periods  indicated,  net sales  by
segment, excluding intersegment sales:

                                                      Three Months Ended
                                                         September 30,
                                                        1995      1994  
                                                    _________________________
                                                        (In thousands)

            Ophthalmic distribution                   $  5,616  $  6,071
            Contract manufacturing                       2,273     2,470
                                                    ___________ __________
            Total net sales                           $  7,889  $  8,541
                                                    =========== ==========

Net sales declined  8% in the quarter ended September 30, 1995 compared to the
same  period in  1994, with  sales of  $7.9 million  versus $8.5  million. The
decline in  sales is primarily due  to the temporary absence  of the Company s
lead allergy product, AK-Con-A, since the second quarter of fiscal 1995.

For  the  quarter  ended September  30,  1995,  ophthalmic  distribution sales
declined  7% over the  comparable period in  1994.  This  decline is primarily
related to  the absence of AK-Con-A  which accounted for over  $1.3 million in
sales for the prior year first quarter.  Ophthalmic distribution net sales for
the quarter ended  September 30, 1994, exclusive of  AK-Con-A sales, were $4.7
million  as  compared  to   $5.6  million  in  the  current   period,  thereby
representing a 19% increase.  The Company continued to  see sales increase  in
its core business as a result of prior year new product introductions.
             
As  previously announced,  AK-Con-A  was converted  to over-the-counter  (OTC)
status from prescription  status by  the Food and  Drug Administration  (FDA).
Currently, the  Company is  awaiting approval for  its OTC version,  which was
licensed to Pfizer, Inc. (Pfizer).   Since sales of AK-Con-A continued through
October 1994, sales growth comparisons will be affected for the second quarter
of fiscal 1996 as well.   However, upon approval of the OTC  version, which is
expected in the  near future, the Company will  begin to receive manufacturing
profits and  royalties that should bring incremental profits in the range of 2
cents per share per quarter.

For  the  quarter  ended  September  30,  1995,  contract manufacturing  sales
declined  8% over  the  comparable  period in  1994.    This decline  reflects
fluctuations in ordering patterns  from contract customers which is  common to
this  business.   As  previously  announced,  the Company s  largest  contract
manufacturing  customer, which accounted for  17% and 13%  of consolidated net
sales for  the quarters ended September  30, 1995 and  1994, respectively, has
notified the Company that  it will be transferring  the production of  certain
products  during fiscal 1996  and 1997 to  its own facilities.   Such products
accounted  for $1.4 million in  contract manufacturing sales  for fiscal 1995.
This customer has also notified the  Company that it will be discontinuing the
sale of two other products produced by Akorn Manufacturing, Inc. (AMI).  These
products accounted for approximately $2.9 million  in sales for AMI in  fiscal
1995.  The  Company is presently in discussions with  this customer to acquire
these injectable products.   This would maintain current plant  throughput and
provide an entre  into the  injectable distribution business,  which would  be
synergistic with the ophthalmic distribution business.

In  October 1995, the Company  signed a contract  manufacturing agreement with
Jordan Pharmaceuticals,  Inc. (Jordan) to  develop and  manufacture three  new
generic  injectable  pharmaceutical  products.   In  addition,  the  agreement
secured  the  long-term manufacture  of  three  generic injectables  currently
produced  by AMI  for Jordan.   The  three new  products are  exempt from  FDA
approval under  grandfather  rules, and,  as such, the first of the  three new
products should be  in commercial production within six months.   The combined
contractual payments in  the first year  of the  contract, including fees  for
product  development, are  expected to  approximate $2  million.   Previously,
Jordan represented approximately $900,000 of the Company s contract business.

The  Jordan agreement  allows  for Akorn  to  use information  supporting  the
development of the  products to  pursue recently announced  strategies in  the
injectable marketplace.  The agreement further provides that best efforts will
be used by  both parties to add  two new products each year  to the agreement,
under  the same  terms  and conditions.    This arrangement  goes  beyond mere
contract manufacturing  and represents  the Company s  desire  to enhance  its
relations with contract customers.

Gross Profit
Consolidated gross profit declined  20% to $2.9  million in the quarter  ended
September  30,  1995 compared  to  $3.6 million  for  the same  period  of the
previous  year, with gross margins declining six  percentage points.  The loss
of  higher-margin  AK-Con-A  sales,  lower  overhead  absorption  in  contract
manufacturing and higher product  costs imposed by suppliers were  the primary
reasons for the decline in gross  profit and margins for the quarter.    Gross
margins are  expected to remain lower than those experienced in the first half
of fiscal 1995 due  to the loss of AK-Con-A and increased competition from our
suppliers.   Gross  margins  are  expected to  be  relatively  stable for  the
remainder of fiscal 1996.
            
Selling, General and Administrative Expenses
Selling,  general and administrative (S,G&A)  expenses declined 13% during the
quarter ended  September 30,  1995, as  compared to the  same period  in 1994.
This reduction in S,G & A expenses is partly due to lower sales and partly due
to the  plan, implemented  in  the quarter  ended March  31,  1995, to  reduce
certain S,G&A expenses.

The percentage  of S,G&A expenses to  sales declined to 24.6%  for the quarter
ended September 30, 1995 from 26.1% in the comparable prior year period.  This
decline occurred, in spite  of the decline in  sales, due to the cost  cutting
measures noted above.  The Company continues to monitor the  required level of
S,G&A expenses in relation to sales performance. 
              
Research and Development
Research  and  development (R&D)  expense increased  39%  to $235,000  for the
quarter ended  September 30, 1995, as compared to $169,000 for the same period
in  1994.  This increase  reflects  a  change in  the  mix  of products  under
development to a lower  concentration of products which are  being transferred
from  the Company s previous  manufacturing facilities (site  transfers).  The
estimated  cost  of  these site  transfers  has  been  previously accrued  and
therefore does not have an effect on R&D expense as reported in the statements
of income. 

The   Company  also  has  begun  the  development  of  a  non-steroidal  anti-
inflammatory drug  (NSAID) for ophthalmic  use licensed  from Pfizer.   It  is
anticipated that the majority  of these development costs, which  are expected
to be  funded substantially by monies  obtained from Pfizer,  will be incurred
over the  next 18 months.   In  addition, the Company  recently announced  its
intention to enter  the generic injectable business.  This  entre includes the
plan to file two injectable Abbreviated New Drug Applications (ANDAs) over the
next twelve months.

The current R&D  plan calls for the  filing of ten  to twelve ANDAs in  fiscal
1996, a  much more  aggressive plan than  in prior  years.   As a result,  the
Company  anticipates that fiscal 1996 R&D expense will be significantly higher
than the prior year amount.

Interest and Other Income/Expense
Interest costs incurred  during all of the prior fiscal  year and through July
1995  were capitalized  as part  of the  cost of  construction related  to the
Company's  expansion project  at its Decatur  manufacturing facilities.   This
expansion  is  now substantially  completed and  ready  for its  intended use.
Accordingly, all future  periods will  include interest expense  that will  be
charged to operations rather  than capitalized based on the  total outstanding
borrowings.

Included in interest and other income for the quarter ended September 30, 1995
is  a  $79,859 gain  recognized  on  the sale  of  the  Company s only  equity
investment.

Income Taxes
The effective  tax rate for  the quarters  ended September 30,  1995 and  1994
remained consistent at 37%.  The Company has been in  discussions the Internal
Revenue Service (IRS) regarding the examination of tax returns for the periods
of 1988 through 1993.  The IRS  has proposed adjustments to such returns, some
of which the  Company has agreed  to and some  which the Company will  appeal.
The financial statement effects of these proposed agreed upon adjustments have
been previously recorded.

Net Income 
Net income  for the quarter ended  September 30, 1995 declined  to $461,000 or
three cents  per share compared to  the prior year amount of  $786,000 or five
cents per share, as a result of the factors noted above.

FINANCIAL CONDITION AND LIQUIDITY

The net  cash  provided by  operating activities  for the  three months  ended
September 30, 1995  was $205,000 compared  to net cash  used of  approximately
$379,000   for  the  corresponding  period  in  1994.    While  the  Company's
profitability declined in the current quarter, in the prior period quarter the
Company had a significant buildup in inventory as a result of new product line
additions.  This buildup has since stabilized.

In  addition to the  inventory buildup, final  estimated tax payments  for the
fiscal year ended June 30,  1994 were made during the first quarter  of fiscal
1995.

In 1996, the Company will  continue to fund the payment of  certain previously
accrued  research and  development activities including  the site  transfer of
ANDAs   and  development  of  the  NDA  for  an  NSAID  discussed  previously.
Management  believes  that existing  cash,  cash  flows from  operations,  and
available working capital line of credit are sufficient to handle these short-
term needs.

In  addition to  these short-term needs,  the Company  may be  required to pay
additional interest and taxes in connection with the examination by the IRS of
tax returns for the periods of 1988 through 1993.  The proposed adjustments by
the  IRS would  result  in  additional interest  and  taxes  currently due  of
approximately $1.5 million.  To date, the Company and the IRS have agreed upon
issues resulting in approximately  $600,000 of current net taxes  and interest
due. Payment of the agreed upon items is expected  to be made over the next 10
months  under  an  agreement  with  the IRS  or  through  arrangements  with a
commercial bank.   Payment of the remaining unsettled issues, if any, would be
based on the  timing of the appeals process and the  success of the Company in
arguing its position with the IRS.   The Company does not currently anticipate
any  adverse  financial  statement  effect from  this  proposed  assessment as
accruals  for the  financial statement effects  of these  proposed adjustments
have been previously recorded.

Under  a  previously  announced  cross-licensing agreement  with  Pfizer,  the
Company is  required to pay a  performance penalty of $1,020,000  should it be
unsuccessful in  obtaining approval, by December  31, 1996, of the  NDA on the
OTC version  of AK-Con-A,  which was  licensed to  Pfizer.  Given the  current
status  of the pending NDA,  management believes the  likelihood that approval
will not be obtained in this time frame is  remote.  Accordingly, no financial
statement reserves related to the potential penalty have been accrued.
             
The Company invested $230,000 in new property, plant and  equipment during the
quarter  ended September 30,  1995, compared to  $1.3 million during  the same
period in 1994.  The prior year amount was  primarily related to the expansion
at the Company s manufacturing  facilities in Decatur, Illinois which  has now
been substantially completed.
            
On September 30, 1994, the Company entered into a $6.3 million credit facility
with a commercial bank.  The credit facility includes the following:

 -   a $1.3 million  Term loan for the  payout of existing debt  and
     reimbursement  for the early payout  of a capital  lease on the
     AMI manufacturing facility.

  -  a $3.5 million Revolver/Term construction loan to finance the
     expansion of the AMI facilities.

  -  a $1.5 million Line of Credit for working capital purposes.

The  entire Term loan was drawn in October 1994 and, as of September 30, 1995,
$2.6 million had been drawn on the Revolver/Term construction loan. 

The construction project at  the Decatur facilities allows for  new high-speed
ophthalmic production, as well as new capabilities for  suspensions, ointments
and unit-dose  products.  The total  cost of the  expansion project, including
additional equipment, was approximately  $5.4 million.  The Company  has plans
for capital improvements of approximately $2  million to $3 million for fiscal
1996.  The amount of  these improvements will be funded through  internal cash
flows and $900,000 remaining availability under the Revolver/Term construction
loan. The  timing of these  expenditures will be  staged to ensure  compliance
with debt covenant requirements.

The  Company  used  $30,000 in  financing  activities  for  the quarter  ended
September  30,  1995,  primarily related  to  the  repayment  of certain  debt
obligations.   This compares with $164,000 provided by financing activities in
the prior  year.  In  the prior year,  short-term borrowings of  $225,000 were
made  as of  September 30,  1994.   As of  September 30,  1995, there  were no
borrowings under the line of credit.
                                      

<PAGE>                                      

 
                                     PART II.  OTHER INFORMATION



Item 1. Legal Proceedings
        
        Certain legal  proceedings in which  the registrant, Akorn,  Inc. (the
        "Company"), is  involved are described in Item 3 to the Company's Form
        10-KSB for the fiscal year  ended June 30, 1995 and  in Note R to  the
        consolidated financial statements included in that report.


Item 2. Changes in Securities

        Not applicable.


Item 3. Defaults Upon Senior Securities

        Not applicable.


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

  The annual meeting of the Company's shareholders was held on October 28, 1995
  (the  Meeting ). The only matter voted  on at the Meeting was the election of
  directors.

  At the Meeting all of the nominees listed were elected by the votes indicated
  below.  There were no broker no-votes with respect to any nominee.  No other
  directors have terms of office that continued after the Meeting.

            Nominee                                For             Withheld    
          ____________                           _______           __________

      Daniel E. Bruhl, M.D.                     12,350,436           794,974 
      J. Ed Campbell, M.D.                      12,348,300           797,110 
      George S. Ellis, M.D.                     12,347,800           797,610 
      Doyle S. Gaw                              12,282,408           863,002 
      John N. Kapoor, PhD.                      12,900,831           244,579 
      Barry D. LeBlanc                          12,900,135           245,275 
      David H. Turner, M.D.                     12,281,430           863,980 
      Lawrence A. Yannuzzi, M.D.                12,277,801           867,609 


Item 5. Other Information
                     
        Not applicable.


Item 6. Exhibits and Reports on Form 8-K

        (a)    Exhibits

        (11.1)    Computation of Earnings per Share
             
        (27)      Financial Data Schedules

        (99.1)    Press release  issued by  Akorn, Inc.  on October 26,
                  1995  announcing its  first  quarter  1996  financial
                  results.


        (b)    Reports on Form 8-K

               None


<PAGE>

                                      SIGNATURES

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

                                              AKORN, INC.




                                        /s/ Barry D. LeBlanc
                                        ______________________
                                           Barry D. LeBlanc
                                 President and Chief Executive Officer
                                       (Duly Authorized Officer)




                                        /s/ Eric M. Wingerter 
                                        ________________________
                                           Eric M. Wingerter
                              Vice President - Finance and Administration
                                     (Principal Financial Officer)






                                                                 Exhibit 11
                                          Akorn, Inc.

                                 COMPUTATION OF NET INCOME PER SHARE
                                 (In Thousands, Except Per Share Data)


                                              Three Months Ended September 30,
                                                   1995             1994  
                                              _______________ _______________
         Earnings
           Income applicable to 
            common stock                         $      461      $      786
                                              ===============  ==============
         Shares
           Weighted average number of shares
            outstanding                              14,910          14,802
           Additional shares assuming
            conversion of options and warrants          350             484
                                              _______________   _____________

           Pro forma shares                          15,260          15,286
                                              ===============   ==============
         Net income per share                    $      .03      $      .05
                                              ===============   ==============






<TABLE> <S> <C>

<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION FROM CONSOLIDATED FINANCIAL
STATEMENTS FOR THE PERIOD ENDED SEPTEMBER 30, 1995 AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
       
<S>                             <C>
<PERIOD-TYPE>                   3-MOS
<FISCAL-YEAR-END>                          AUG-30-1995
<PERIOD-END>                               SEP-30-1995
<CASH>                                         954,962
<SECURITIES>                                 1,290,739
<RECEIVABLES>                                5,147,237
<ALLOWANCES>                                 (266,455)
<INVENTORY>                                  6,419,281
<CURRENT-ASSETS>                            14,821,877
<PP&E>                                      17,976,595
<DEPRECIATION>                             (6,935,466)
<TOTAL-ASSETS>                              26,824,409
<CURRENT-LIABILITIES>                        6,845,445
<BONDS>                                      3,695,786
<COMMON>                                    13,701,845
<PREFERRED-MANDATORY>                                0
<PREFERRED>                                          0
<OTHER-SE>                                   1,706,726
<TOTAL-LIABILITY-AND-EQUITY>                26,824,409
<SALES>                                      7,888,548
<TOTAL-REVENUES>                             7,888,548
<CGS>                                        5,001,214
<TOTAL-COSTS>                                5,001,214
<OTHER-EXPENSES>                             2,167,153
<LOSS-PROVISION>                                 6,000
<INTEREST-EXPENSE>                            (86,565)
<INCOME-PRETAX>                                731,444
<INCOME-TAX>                                   270,634
<INCOME-CONTINUING>                            460,810
<DISCONTINUED>                                       0
<EXTRAORDINARY>                                      0
<CHANGES>                                            0
<NET-INCOME>                                   460,810
<EPS-PRIMARY>                                      .03
<EPS-DILUTED>                                        0
        

</TABLE>





                                                          Exhibit 99.1

AT AKORN:                               AT FRB:
Barry LeBlanc       Eric Wingerter      Jenifer Estabrook   Kathy Brunson
President & CEO     VP-Finance          General Information Analyst Contact
(504) 893-9300                          (312) 640-6787      (312) 640-6696


          FOR IMMEDIATE RELEASE
          THURSDAY, OCTOBER 26, 1995

          
          AKORN'S 1ST-QTR RESULTS IN LINE WITH MANAGEMENT'S EXPECTATIONS;
                            OUTLOOK POSITIVE

          ABITA SPRINGS, LA  OCTOBER 26, 1995 --Akorn, Inc. (Nasdaq:  AKRN)
          today announced that net income for the first quarter was 
          $460,000, or 3 cents per share, on sales of $7.9 million, compared
          with net income of $786,000, or 5 cents per share, on sales of
          $8.5 million in the year-ago period.
                
                These results were in line with our estimates and reflect 
          the continued, temporary absence of our lead allergy product, AK-
          Con-A, since the second quarter of fiscal 1995," said Barry
          LeBlanc, Akorn's president and chief executive officer.   This
          product accounted for approximately $1.3 million in sales and net
          income of nearly 3 cents per share in the prior-year period."

               As previously announced, the Food and Drug Administration
          (FDA) switched AK-Con-A to over-the-counter (OTC) status in the
          second quarter of Akorn's fiscal 1995.  Currently, the company is
          awaiting FDA approval for its OTC version, which Akorn licensed
          to Pfizer.  Under terms of the
 agreement, Akorn will receive
          manufacturing profits and royalties that, according to the
          company, should bring incremental profits in the range of 2 cents
          per quarter upon approval.

          REVIEW OF RESULTS

               Net sales for the quarter ended September 30, 1995, were
          $7.9 million, down 8 percent from last year's $8.5 million.
          Gross profit declined 20 percent from $3.6 million to $2.9
          million.  Gross margins declined considerably, primarily due to
          the fact that AK-Con-A was Akorn's highest-margin product at
          nearly 75 percent.

               Operating expenses declined 13 percent during the quarter,
          while research and development expenditures increased 39 percent,
          reflecting an accelerated program to obtain Abbreviated New Drug
          Applications (ANDAs).  Operating expenses as a percentage of
          sales declined to 24.6 percent for the quarter ended September
                                       -more-           

          Akorn, Inc.
          Add-1
          
          30, 1995, from 26.1 percent for the prior-year period.  The
          company's effective tax rate remained stable at 37 percent.

          OUTLOOK

               "The absence of AK-Con-A certainly had a significant effect
          on comparative results" LeBlanc noted.  "However, current
          indications from the FDA regarding approval of our New Drug
          Application (NDA) on the OTC version of this product are very
          favorable, with approval expected in the very near future."

               LeBlanc added, "In response to the temporary loss of AK-
          Con-A, we implemented cost-reduction strategies beginning in the
          third quarter of fiscal 1995 that were designed to achieve an
          average earnings run rate of 3 to 4 cents per quarter.  Our
          operating results since that time have indicated the success of
          this strategy.  With the recent approvals of several ANDAs along
          with the anticipated approval of our pending NDA, our quarterly
          run rate should approximate 6 to 7 cents by fiscal year end."

               LeBlanc concluded, "We will continue to leverage our
          existing strengths in an effort to increase both sales and
          earnings.  Our recent announcements to increase our presence in
          the injectable pharmaceutical market are examples of that
          leverage.  The targeted filing of two injectable ANDAs by fiscal
          year end will expand Akorn's presence in the sterile generic
          pharmaceutical marketplace.  In addition, our new approach to the
          contract manufacture of injectables will lead to a positive
          impact on sales and earnings, as early as the second half of our
          current fiscal year."

               Akorn, Inc. manufactures sterile ophthalmic and injectable
          pharmaceuticals, and markets and distributes an extensive line of
          ophthalmic products.

           For additional information about Akorn, Inc. free of charge via
           fax, dial 1-800-PRO-INFO and enter "AKRN."

          FINANCIAL TABLES FOLLOW...
Akorn, Inc.
Add -2-

CONSOLIDATED STATEMENT OF EARNINGS
(in thousands, except per share amounts)


                                         Three months ended September 30,
                                              1995       1994    % Chg
                                          __________ __________ ___________
Net sales                                   $7,888     $8,541       -7.6%
Cost of sales                                5,001      4,920        1.6%
                                          __________ _________
Gross profit                                 2,887      3,621      -20.3%

Selling, general and administrative          1,938      2,232      -13.2%
Research and development                       235        169       39.1%
                                          __________ _________
Operating income                               714      1,220      -41.5%

Interest & other income (expense), net          17         28      -39.3%
                                          __________ _________
Pretax income                                  731      1,248      -41.4%
Income taxes                                   270        462      -41.6%
                                          __________ _________
Net income                                    $461       $786      -41.3%
                                          ========== =========
Per share:
  Net income                                 $0.03      $0.05      -40.0%
                                          ========== =========
Weighted average shares                     15,260     15,286       -0.2%
                                          ========== =========


<PAGE>

Akorn, Inc.
Add -3-


CONSOLIDATED BALANCE SHEET
(in thousands)

                                                September 30,  June 30,
                                                     1995        1994
                                                ___________ ___________
Assets
Cash and investments                               $2,246      $2,336
Accounts receivable, net                            4,881       4,919
Other current assets                                7,695       7,048
                                                ___________ ___________
     Total current assets                          14,822      14,303

Property, plant and equipment, net                 11,041      10,996
Other assets                                          961         957
                                                ___________ ___________
     Total assets                                 $26,824     $26,256
                                                =========== ===========

Liabilities and shareholders' equity
Current portion of long-term debt 
  and capital leases                              $   780     $   642
Trade accounts payable                              1,990       1,719
Income taxes payable                                  904         782
Accrued reorganization costs                          706         727
Other accrued expenses                              2,465       2,531
                                                ___________ ___________
     Total current liabilities                      6,845       6,401

Long-term debt and capital leases                   3,696       3,900
Other long-term liabilities                           874         957

Shareholders' equity                               15,409      14,998
                                                ___________ ___________
     Total liabilities and shareholders' equity   $26,824      $26,256
                                                =========== ===========