Pernix Therapeutics Announces Agreement to Acquire Cypress Pharmaceuticals, Inc. and Hawthorn Pharmaceuticals, Inc.

  Pernix Therapeutics Announces Agreement to Acquire Cypress Pharmaceuticals,
  Inc. and Hawthorn Pharmaceuticals, Inc.

  To Significantly Increase and Broaden Pernix’s Branded and Generic Product
                                  Portfolio

    To Provide Pipeline of Generic ANDAs and Branded NDAs and Products in
                                 Development

                 To Enhance Clinical and Regulatory Expertise

                    Company Receives Financing Commitment

Business Wire

THE WOODLANDS, Texas -- November 14, 2012

Pernix Therapeutics Holdings, Inc. (“Pernix” or the “Company”) (NYSE MKT:
PTX), a specialty pharmaceutical company, today announced that it has entered
into a definitive agreement to acquire Cypress Pharmaceuticals, Inc.
(“Cypress”), a privately-owned generic pharmaceutical company, and Hawthorn
Pharmaceuticals, Inc. (“Hawthorn”), a privately-owned branded pharmaceutical
company.

Under the terms of the agreement, Pernix will pay approximately $101 million,
which includes an up-front payment of $68.5 million in cash and $12.5 million
in equity, $10 million payable in December 2013, and an additional $10 million
in milestone payments. The Company has received a commitment of a $60 million
credit facility. MidCap Financial will serve as Sole Bookrunner,
Administrative Agent and Joint Lead Arranger.

Cypress and Hawthorn, founded in 1993, are headquartered in Madison, MS and
have 170 employees, including 115 sales reps. In 2012, revenues for Cypress
and Hawthorn are expected to be approximately $50 million, consisting of
approximately 54% generic products and 46% branded products. Hawthorn offers a
wide array of branded pharmaceutical products, including allergy, respiratory,
iron deficiency, nephrology and pain management. Cypress offers a broad range
of generic pharmaceutical products in the areas of cough and cold, nutritional
supplements, analgesics, urinary tract, women’s health, pre-natal vitamins and
dental health.

This acquisition is expected to significantly increase and broaden Pernix’s
branded and generic product portfolio. Cypress and Hawthorn also have clinical
and regulatory expertise, receiving approval of more than 10 ANDAs in the last
three years and 2 NDAs in 2011. Additionally, 15 ANDAs and one 505(b)(2) NDA
were filed at the FDA, and Cypress and Hawthorn also have several products in
clinical development.

Cooper Collins, President and CEO of Pernix, said, “This will be the most
significant acquisition in the Company’s history. The generic and branded
businesses of Cypress and Hawthorn are an excellent fit for Pernix, which is
expected to increase the Company’s revenues for the full year 2013 to
approximately $135-$145 million. The Cypress and Hawthorn pipeline, which
includes products filed with the FDA or in development, will move us forward
on our strategic plan to drive the Company’s future success. We are
enthusiastic about working with the Cypress and Hawthorn’s management team as
we integrate our companies. We are confident that Pernix, Cypress and Hawthorn
are an excellent combination that will provide strong growth in the future.”

The acquisition is subject to applicable regulatory approvals and other terms
and conditions and is expected to close by the end of the year.

Conference Call and Webcast Information

Management will host a conference call today at 9:00 a.m. EST to discuss the
acquisition of Cypress and Hawthorn and its financial results for the third
quarter and nine months ended September 30, 2012. The conference call will
feature remarks from Cooper Collins, President and Chief Executive Officer,
and David Becker, Chief Financial Officer. To participate in the live
conference call, please dial (888) 364-3109 (U.S.) or (719) 325-2432
(International), and provide passcode 9218466. A live webcast of the call will
also be available on the investor relations section of the Company’s website,
www.pernixtx.com.

About Pernix Therapeutics Holdings, Inc.

Pernix Therapeutics is a specialty pharmaceutical company primarily focused on
the sales, marketing, manufacturing and development of branded, generic and
OTC pharmaceutical products. The Company manages a portfolio of branded and
generic products. The Company’s branded products for the pediatrics market
include CEDAX®, an antibiotic for middle ear infections, NATROBA™, a topical
treatment for head lice marketed under an exclusive co-promotion agreement
with ParaPRO, LLC, and a family of treatments for cough and cold (BROVEX®,
ALDEX® and PEDIATEX®). The Company’s branded products for gastroenterology
include OMECLAMOX-PAK®, a 10-day treatment for H. pylori infection and
duodenal ulcer disease, and REZYST™, a probiotic blend to promote dietary
management. The Company promotes its branded pediatric and gastroenterology
products through its sales force. Pernix markets its generic products through
its wholly-owned subsidiary, Macoven Pharmaceuticals. The Company’s
wholly-owned subsidiary, Great Southern Laboratories, manufactures and
packages products for the pharmaceutical industry in a wide range of
dosage-forms. A product candidate utilizing cough-related intellectual
property is in development for the U.S. OTC market. Founded in 1996, the
Company is based in The Woodlands, TX.

Additional information about Pernix is available on the Company’s website
located at www.pernixtx.com.

About MidCap Financial, LLC

MidCap Financial, LLC is a commercial finance company focused on middle market
lending in the broad national healthcare industry. MidCap specializes in $5
million to $200 million loans. The company is headquartered in Bethesda, MD,
with offices in Chicago and Los Angeles and focuses on four areas:

  *Leveraged loans to healthcare companies with over $5 million in EBITDA;
  *Life Sciences loans to VC-backed and public pharmaceutical, biotech and
    medical device companies;
  *Asset-Based working capital loans to healthcare providers collateralized
    by third-party accounts receivable and other assets;
  *Real Estate loans to skilled nursing facilities, senior housing properties
    and medical office buildings.

Additional information about MidCap Financial, LLC can be found at
www.midcapfinancial.com.

Cautionary Notice Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995, including the completion
of the transaction described above. Statements including words such as
“estimate,” “plan,” “project,” “forecast,” “intend,” “expect,” “anticipate,”
“believe,” “seek,” “target” or similar expressions are forward-looking
statements. Because these statements reflect the Company’s current views,
expectations and beliefs concerning future events, these forward-looking
statements involve risks and uncertainties. No assurances can be given that
the Company will be able to complete the transaction when anticipated or at
all nor does the Company provide any assurances regarding its future
performance. Investors should note that many factors, as more fully described
under the caption "Risk Factors" in our Form 10-K, Form 10-Q and Form 8-K
filings with the Securities and Exchange Commission and as otherwise
enumerated herein or therein, could affect the Company’s future financial
results and could cause actual results to differ materially from those
expressed in forward-looking statements contained in the Company’s Annual
Report on Form 10-K. The forward-looking statements in this press release are
qualified by these risk factors. These are factors that, individually or in
the aggregate, could cause our actual results to differ materially from
expected and historical results. The Company assumes no obligation to publicly
update any forward-looking statements, whether as a result of new information,
future developments or otherwise.

Contact:

Pernix Therapeutics Holdings, Inc.
Joseph T. Schepers, 800-793-2145 ext. 3002
Director, Investor Relations
jschepers@pernixtx.com
 
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