EXHIBIT 10.43

[QUESTCOR LETTERHEAD]

February 3, 2004

VIA EMAIL
Reinhard Koenig, M.D., Ph.D.
3260 Whipple Road
Union City, CA 94587

Re: Offer of Employment

Dear Dr. Koenig:

Questcor Pharmaceuticals, Inc. (the “Company”) is pleased to offer you the
position of Vice President, Medical Affairs, on the terms described below.
Should you accept our offer of employment, your start date will be on or before
February 8, 2004.

You will report to R. Jerald Beers, Vice President, Sales and Marketing. Your
office will be located at our facility in Union City, California. Of course, the
Company may change your reporting responsibilities, position, duties, and work
location from time to time, as it deems necessary.

Your base compensation will be $170,000 per annum ($7,083.33 semi-monthly) less
all amounts the Company is required to hold under applicable laws. During your
first two weeks of employment, the Company will extend to you a note in the
amount of $50,000, the terms of which will be covered in the Promissory Note.
You will be a participant in the annual management incentive program for
executives, which has been approved by the Compensation Committee. Your
incentive bonus will be based on the attainment of specific milestones during
each calendar year. Said milestones will be communicated to you in writing by
Mr. Beers following the start of your employment and will be updated annually as
part of the performance review process. Your bonus opportunity will be 33% of
your base compensation earnings in the calendar year to which it applies. For
2004, 50% of your bonus opportunity will be based on the attainment of mandatory
corporate objectives, which have yet to be determined by the board of
director’s. The bonus opportunity will not become effective unless or until the
corporate objectives have been met.

You will be eligible to participate in the Company’s various benefit plans
including medical, dental and vision insurance, as well as life, accidental
death and disability insurance. You will receive 16 days of paid vacation per
calendar year, in addition to 12 paid regular holidays and two paid floating
holidays. You will also be eligible to

 

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participate in the Company’s 401(k) Plan, Section 529 College Savings Program
and Employee Stock Purchase Plan. The eligibility requirements for these plans
are explained in the Company’s Employee Handbook, and in the case of the
Company’s 401(k) Plan, in the 401(k) Plan’s summary plan description. A copy of
the Employee Handbook and the 401(k) Plan’s summary plan description will be
provided to you. Please read them carefully. Of course, to the extent the
provisions of the various plans are inconsistent with the provisions of the
Employee Handbook or summary plan description, the plan provisions will control.

As you no doubt appreciate, as a Company employee, you will be expected to abide
by Company rules and regulations, acknowledge in writing that you have read the
Company’s Employee Handbook, sign and comply with a Proprietary Information and
Inventions Agreement which prohibits unauthorized use or disclosure of Company
proprietary information and sign the Policy Against Insider Trading.

The Company’s management has in effect an employee stock option plan to
recognize the talent and skills our employees bring to the Company. Management
will recommend to the Board of Directors that, at the time you join the Company,
the Company grant to you an option under the stock option plan to purchase
250,000 shares of the Common Stock of the Company at an exercise price equal to
100% of the closing price of the Company’s Common Stock on the date prior to
approval by the Board of Directors. One-eighth (1/8th) of these options will
vest after six (6) months of employment and thereafter the remaining shares will
vest at the rate of 1/48th of the total grant on each monthly anniversary of
your continued employment with the Company. The option will be subject to the
terms and conditions of the Company’s stock option plan and your stock option
agreement.

The Company will review your performance in accordance with the Employee
Handbook, to assess your accomplishment of milestones and goals, which the
Company reasonably sets for you. The Company will consider whether and when you
should receive increases in your compensation and benefits as described therein
based on such accomplishments.

You may terminate your employment with the Company at any time and for any
reason whatsoever simply by notifying the Company. Likewise, the Company may
terminate your employment at any time and for any reason whatsoever, with or
without cause or advance notice. This at-will employment relationship cannot be
changed except in writing signed by the Chief Executive Officer or the Chief
Financial Officer.

Any and all disputes connected with, relating to or arising from your employment
with the Company will be settled by final and binding arbitration in accordance
with the rules of the American Arbitration Association as presently in force.
The only claims not covered by this Agreement are claims for benefits under the
unemployment insurance or workers’ compensation laws. Any such arbitration will
take place in Alameda County, California. The parties hereby incorporate into
this agreement all of the arbitration provisions of Section 1283.05 of the
California Code of Civil Procedure. The Company understands and agrees that it
will bear the costs of the arbitration filing and hearing fees and the cost of
the arbitrator. Each side will bear its own attorneys’ fees, and the arbitrator
will not have authority to award

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attorneys’ fees unless a statutory section at issue in the dispute authorizes
the award of attorneys’ fees to the prevailing party, in which case the
arbitrator has authority to make such award as permitted by the statute in
question. The arbitration shall be instead of any civil litigation; this means
that you are waiving any right to a jury trial, and that the arbitrator’s
decision shall be final and binding to the fullest extent permitted by law and
enforceable by any court having jurisdiction thereof. Judgment upon any award
rendered by the arbitrators may be entered in any court having jurisdiction.

The employment terms in this letter supersede any other agreements or promises
made to you by anyone, whether oral or written, express or implied. In the event
you accept this employment offer, the terms set forth in this letter will
comprise our final, complete and exclusive agreement with respect to the subject
matter of this letter. Thus, by accepting this employment offer and signing this
offer letter, you agree to be bound by its terms and conditions. As required by
law, the Company’s offer is subject to satisfactory proof of your right to work
in the United States no later than three days after your employment begins.

Please sign and date this letter, and return it to me as soon as possible. This
offer terminates if it is not signed and delivered to me by February 5, 2004. A
facsimile copy will suffice for this purpose, so long as an original signature
is delivered when you commence employment. My confidential facsimile number is
(928) 244-3718.

We look forward to your favorable reply and to a productive and enjoyable work
relationship.

Sincerely,

     
/s/ FREDRIC I. STORCH
   

Fredric I. Storch
Senior Director, Human Resources and Administration

I hereby acknowledge that I have read the foregoing letter and agree to be bound
by all of its terms and conditions:

     
/s/ REINHARD KOENIG
   
Reinhard Koenig, M.D., Ph.D.
   
 
   
February 4, 2004
   
                       Date
   

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