Cortex second quarter net loss decreases to $356,000

Cortex Pharmaceuticals, Inc. (OTCBB: CORX) reported a net loss of approximately $356,000, or $0.00 per share, for the quarter ended June 30, 2011, compared with a net loss of approximately $2,454,000, or $0.04 per share, for the corresponding prior year period, with the difference reflecting revenues in the current year period from the Company's option agreement with Servier, France's largest privately held pharmaceutical company.

“Di-Substituted Amides for Enhancing Glutamatergic Synaptic Responses”

As previously announced, in June 2011 Cortex entered into a new agreement with Servier to sell its remaining rights to the jointly discovered AMPAKINE® compound, CX1632. In connection with the agreement, Servier provided Cortex with a nonrefundable $1,000,000 payment in exchange for the option to expand its rights to the compound. If Servier exercises the option to acquire sole ownership of the patent rights to CX1632 prior to October 31, 2011, it will pay Cortex an additional $2,000,000. The Company will not be entitled to any royalties or further payments from Servier's development and commercialization of CX1632, but Cortex retains all rights for its remaining AMPAKINE technology on a worldwide basis.

For the three months ended June 30, 2011, the Company's total operating expenses decreased to approximately $1,449,000 from approximately $1,969,000 for the corresponding prior year quarter, due mostly to costs for advisory consultants during the prior year period, as well as timing of clinical development expenses for the Company's Phase IIa study with AMPAKINE CX1739 in patients with sleep apnea.

For the six months ended June 30, 2011, the Company reported a net loss of approximately $1,912,000, or $0.02 per share, compared with net income of approximately $3,141,000, or $0.05 per share, for the corresponding prior year period, with the difference primarily reflecting revenues of $9,000,000 from the Company's March 2010 transaction with Biovail.

Operating expenses for the six months ended June 30, 2011 decreased to approximately $3,033,000 from approximately $5,301,000 for the corresponding prior year period, with the decrease mostly due to sublicense fees and administrative expenses in the prior year period related to the March 2010 transaction with Biovail.

Interest expense for the prior year periods includes non-cash charges related to the June 2010 conversion of the promissory note issued to Samyang Optics Co., Ltd. ("Samyang") of Korea. As reported earlier, the convertible note was issued in connection with the Company's $1,500,000 private placement to Samyang in January 2010.

Recent Business Highlights

• February 2011: Announced top-line results from an exploratory clinical study with AMPAKINE CX1739 in subjects with sleep apnea. Based upon the observed responses to CX1739, Cortex believes the results warrant undertaking a study to test CX1739 in patients with central sleep apnea, which is often seen in heart failure patients and in chronic opiate users.
• March 2011: Reacquired the compounds, rights and patents to develop and commercialize AMPAKINE compounds for the treatment of respiratory depression and vaso-occlusive crises associated with sickle cell disease.
• April 2011: Announced receipt of a notice of allowance from the US PTO for the patent "Di-Substituted Amides for Enhancing Glutamatergic Synaptic Responses," which provides patent protection into the year 2028 for Cortex's lead compound, CX1739, and approximately 80 other AMPAKINE compounds.
• June 2011: Entered an option agreement with Servier for the jointly discovered AMPAKINE compound CX1632. Received a nonrefundable payment from Servier of $1,000,000. If Servier exercises its option before October 31, 2011, Cortex will receive another $2,000,000 from Servier.