Pernix Therapeutics reports decrease in net sales for 2010 second quarter

Pernix Therapeutics Holdings, Inc. (NYSE Amex: PTX), a specialty pharmaceutical company primarily focused on the pediatric market, today announced results for the quarter and six months ended June 30, 2010.

Second Quarter 2010 Highlights

• Commenced sales of Cedax®, an antibiotic for middle ear infections;
• Profitability sustained - reported income before taxes and non-controlling interest of $365,000 for the second quarter of 2010;
• Broadened opportunity to grow collaboration revenue via a co-promotion agreement with Macoven to exclusively market ZEMA PAK®, a corticosteroid for skin rashes;
• Hired 25 new sales representatives in June 2010 increasing our sales team by 78% ;
• Maintained a debt-free balance sheet with $11,926,000 of cash, cash equivalents and restricted cash; and
• Added to the Russell Microcap^® Index on June 28, 2010.

For the second quarter of 2010, net sales were approximately $4,358,000, compared to $6,514,000 for the prior-year quarter. This decrease was primarily due to increased sales of lower-priced products through a planned change in product mix, Medicaid rebates and a one-time promotional price offered to customers in the prior-year quarter. Income before taxes and non-controlling interest during the quarter was $365,000, compared to $2,954,000 in the prior-year period. The decrease was primarily due to lower margins from the increased Medicaid rebate expense on certain product sales. The Company's after-tax income was approximately $167,000, or $0.01 per share, as compared to $2,961,000, or $0.14 per share, in the prior-year quarter.

For the six months ended June 30, 2010, net sales were approximately $13,231,000, compared to $13,748,000 for the prior-year period. Pernix's income before taxes and non-controlling interest was approximately $4,619,000 for the six months ended June 30, 2010, compared to $5,542,000 for the six months ended June 30, 2009. Pernix's after-tax income was approximately $5,435,000, or $0.23 per share, compared to $5,643,000, or $0.27 per share, in the prior-year period. The after-tax income for the six months ended June 30, 2010 includes one-time benefits associated with the termination of Pernix's "S" Corporation election and the recognition of net operating loss carry forwards associated with Pernix's March 10, 2010 reverse merger with Golf Trust of America, Inc.

Cooper Collins, President and Chief Executive Officer of Pernix, stated, "Our results for the second quarter of 2010 were in-line with our expectations due to the impact of seasonality on our business. We maintained profitability, continued to generate cash flow from operations and took several significant steps to grow the Company. We added the antibiotic Cedax to our portfolio of branded products, and we believe that Cedax will serve as a growth catalyst beginning in the fourth quarter, as demand for treatments for middle ear infections increases in the fall. We also completed the acquisition of the remaining 50% interest in Gaine, which became a wholly-owned subsidiary of Pernix. We continued the expansion of our sales force to 57 full-time representatives across 30 states."

Mr. Collins continued, "Going forward, our strategy is to establish Pernix as a leader for specialty pediatric pharmaceuticals. With a debt free balance sheet and approximately $11.9 million in cash, we remain well positioned to continue our historical growth trajectory through organic growth, co-promotions, and accretive, high-margin product and synergistic corporate acquisitions. We remain on-track to deliver profitable year over year revenue growth in 2010."

As of June 30, 2010, the Company had $11,926,000 in cash, cash equivalents and restricted cash, an increase of $7,348,000 compared to December 31, 2009.