----

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**UNITED      STATES**

**SECURITIES      AND EXCHANGE COMMISSION**

**Washington,      D.C. 20549**

**FORM      10-Q**

**000-23143**

**PROGENICS      PHARMACEUTICALS, INC.**

| **DELAWARE**                                                                                | **13-3379479**                                                    |
|---------------------------------------------------------------------------------------------|-------------------------------------------------------------------|
| (State                or other jurisdiction ofincorporation                or organization) | (I.R.S.                EmployerIdentification                No.) |

**777      Old Saw Mill River Road**

**Tarrytown,      New York 10591**

**(914)      789-2800**

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**PROG**
**ENICS PHARMACEUTICALS,      INC.**

**INDEX**

|                       |                                                                                                                                                                                        | **Page                No.** |
|----------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------|
| **Part                I**  | **FINANCIAL                INFORMATION**                                                                                                                                                    |                        |
| Item                1.     | Consolidated                Financial Statements                (unaudited)                                                                                                                 | 3                           |
|                       | Condensed                Consolidated                Balance                Sheets at March 31, 2007 and December 31, 2006                                                                  | 3                           |
|                       | Condensed                Consolidated                Statements                of Operations for the Three Months ended March 31, 2007 and                2006                              | 4                           |
|                       | Condensed                Consolidated                Statement                of Stockholders’ Equity and Comprehensive Loss for the Three Months ended                March 31, 2007 | 5                           |
|                       | Condensed                Consolidated                Statements                of Cash Flows for the Three Months ended March 31, 2007 and                2006                              | 6                           |
|                       | Notes                to Condensed Consolidated                Financial                Statements                                                                                           | 7                           |
| Item                2.     | Management’s                Discussion and Analysis of Financial Condition                and Results of Operations                                                                   | 12                          |
| Item                3.     | Quantitative                and Qualitative Disclosures about Market                Risk                                                                                                    | 25                          |
| Item                4.     | Controls                and Procedures                                                                                                                                                      | 25                          |
|                       |                                                                                                                                                                                        |                        |
| **PART                II** | **OTHER                INFORMATION**                                                                                                                                                        |                        |
| Item                1A.    | Risk                Factors                                                                                                                                                                 | 25                          |
| Item                6.     | Exhibits                                                                                                                                                                                    | 27                          |
|                       | Signatures                                                                                                                                                                                  | 28                          |
|                       | Certifications                                                                                                                                                                              |                        |

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Index

**PART      I — FINANCIAL INFORMATION**

**Item      1. Consolidated Financial Statements **

**PROGENICS  PHARMACEUTICALS,      INC.**

**CONDENSED      CONSOLIDATED BALANCE SHEETS**

**(amounts      in thousands, except for par value and share amounts)**

**(Unaudited)**

|                                                                                                                                                                |   | **March                31, 2007** |     | **December                31, 2006** |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------|----------|--------------------------------------|--------|
| **A****ssets**                                                                                                                                                      |   |                              |     |                                 |   |
| Current                assets:                                                                                                                                      |   |                              |     |                                 |   |   |   |
| Cash                and cash equivalents                                                                                                                            |   | $                                 | 20,237   |                                 | $      | 11,947 |   |
| Marketable                securities                                                                                                                                |   |                              | 104,774  |                                 |   | 113,841 |   |
| Accounts                receivable                                                                                                                                  |   |                              | 1,699    |                                 |   | 1,699 |   |
| Other                current assets                                                                                                                                 |   |                              | 2,835    |                                 |   | 3,181 |   |
| Total                current assets                                                                                                                                 |   |                              | 129,545  |                                 |   | 130,668 |   |
| Marketable                securities                                                                                                                                |   |                              | 15,118   |                                 |   | 23,312 |   |
| Fixed                assets, at cost, net of accumulated depreciation and                amortization                                                               |   |                              | 11,962   |                                 |   | 11,387 |   |
| Restricted                cash                                                                                                                                      |   |                              | 546      |                                 |   | 544 |   |
| Total                assets                                                                                                                                         |   | $                                 | 157,171  |                                 | $      | 165,911 |   |
|                                                                                                                                                                |   |                              |     |                                 |   |   |   |
| **L****iabilities                and****S****tockholders****’                E****quity**                                                                     |   |                              |     |                                 |   |   |   |
| Current                liabilities:                                                                                                                                 |   |                              |     |                                 |   |   |   |
| Accounts                payable and accrued expenses                                                                                                                |   | $                                 | 12,985   |                                 | $      | 11,852 |   |
| Deferred                revenue ¾                current                                                                                                       |   |                              | 26,433   |                                 |   | 26,989 |   |
| Total                current liabilities                                                                                                                            |   |                              | 39,418   |                                 |   | 38,841 |   |
| Deferred                revenue —long term                                                                                                                    |   |                              | 11,385   |                                 |   | 16,101 |   |
| Deferred                lease liability                                                                                                                             |   |                              | 124      |                                 |   | 123 |   |
| Total                liabilities                                                                                                                                    |   |                              | 50,927   |                                 |   | 55,065 |   |
| Commitments                and contingencies (Note  9)                                                                                                         |   |                              |     |                                 |   |   |   |
| Stockholders’                equity:                                                                                                                          |   |                              |     |                                 |   |   |   |
| Preferred                stock, $.001 par value; 20,000,000 shares authorized; issued and                outstanding—none                                     |   |                              |     |                                 |   |   |   |
| Common                stock, $.0013 par value; 40,000,000 shares authorized; issued and                outstanding— 26,503,941 in 2007 and 26,199,016 in 2006 |   |                              | 34       |                                 |   | 34 |   |
| Additional                paid-in capital                                                                                                                           |   |                              | 327,067  |                                 |   | 321,315 |   |
| Accumulated                deficit                                                                                                                                  |   |                              | (220,791 | )                                    |   | (210,358 | ) |
| Accumulated                other comprehensive (loss)                                                                                                               |   |                              | (66      | )                                    |   | (145 | ) |
| Total                stockholders’ equity                                                                                                                     |   |                              | 106,244  |                                 |   | 110,846 |   |
| Total                liabilities and stockholders’ equity                                                                                                     |   | $                                 | 157,171  |                                 | $      | 165,911 |   |

**The      accompanying notes are an integral part of these condensed financial      statements.**

----

Index

**PROGENICS      PHARMACEUTICALS, INC.**

**CONDENSED      CONSOLIDATED STATEMENTS OF      OPERATIONS**

**(amounts      in thousands, except net loss per share)**

**(Unaudited)**

|                                                                       |   | **For                the three months ended** |    |
|----------------------------------------------------------------------------|--------|-----------------------------------------------|---------|
|                                                                       |   | **March                31,**                  |    |
|                                                                       |   | **2007**                                      |    | **2006** |   |
| Revenues:                                                                  |   |                                          |         |   |   |  |   |
| Contract                research and development from collaborator         |   | $                                             | 15,499  |   | $ | 8,488 |   |
| Research                grants and contracts                               |   |                                          | 2,119   |   |   | 2,462 |   |
| Product                sales                                               |   |                                          | 19      |   |   | 51 |   |
| Total                revenues                                              |   |                                          | 17,637  |   |   | 11,001 |   |
|                                                                       |   |                                          |    |   |   |   |   |
| Expenses:                                                                  |   |                                          |    |   |   |   |   |
| Research                and development                                    |   |                                          | 22,421  |   |   | 10,                283 |   |
| License                fees ¾                research and development |   |                                          | 750     |   |   | 275 |   |
| General                and administrative                                  |   |                                          | 6,276   |   |   | 4,512 |   |
| Loss                in joint venture                                       |   |                                          |    |   |   | 121 |   |
| Depreciation                and amortization                               |   |                                          | 492     |   |   | 363 |   |
| Total                expenses                                              |   |                                          | 29,939  |   |   | 15,554 |   |
| Operating                loss                                              |   |                                          | (12,302 | ) |   | (4,553 | ) |
|                                                                       |   |                                          |    |   |   |   |   |
| Other                income:                                               |   |                                          |    |   |   |   |   |
| Interest                income                                             |   |                                          | 1,869   |   |   | 1,910 |   |
| Total                other income                                          |   |                                          | 1,869   |   |   | 1,910 |   |
|                                                                       |   |                                          |    |   |   |  |   |
| Net                loss                                                    |   | $                                             | (10,433 | ) | $ | (2,643 | ) |
|                                                                       |   |                                          |    |   |   |   |   |
| Net                loss per share - basic and diluted                      |   | $                                             | (0.40   | ) | $ | (0.10 | ) |
| Weighted-average                shares - basic and diluted                 |   |                                          | 26,365  |   |   | 25,354 |   |

**The      accompanying notes are an integral part of these condensed financial      statements.**

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Index

**PROGENICS      PHARMACEUTICALS, INC.**

**CONDENSED      CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY AND COMPREHENSIVE      LOSS**

**FOR      THE THREE MONTHS ENDED MARCH 31, 2007**

**(amounts      in thousands)**

**(Unaudited)**

|                                                                                                                                |   | Common                Stock |   | Additional |   |                           |   | Accumulated                Other   |    | Total                               |   |                                      |   |
|-------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------|--------|------------|--------|--------------------------------|--------|------------------------------------|---------|-------------------------------------|--------|-------------------------------------------|--------|
|                                                                                                                                |   | Shares                      |   | Amount     |   | Paid-In                Capital |   | Accumulated                Deficit |    | Comprehensive                (Loss) |   | Stockholders’                Equity |   | Comprehensive                (Loss) |   |
| **Balance                at December 31, 2006**                                                                                     |   |                        | 26,199 |       | $      | 34                             |   | $                                  | 321,315 |                                | $      | (210,358                                  | )      | $ | (145 | ) | $ | 110,846 |   |   |   |   |
| Compensation                expense for vesting of share based payment arrangements                                                 |   |                        |   |       |   |                           |   |                               | 2,948   |                                |   |                                      |   |   |   |   |   | 2,948 |   |   |   |   |
| Issuance                of restricted stock, net of forfeitures                                                                     |   |                        | 17     |       |   |                           |   |                               |    |                                |   |                                      |   |   |   |   |   |   |   |   |   |   |
| Sale                of Common Stock under employee stock purchase plans and exercise                of stock                options |   |                        | 288    |       |   |                           |   |                               | 2,804   |                                |   |                                      |   |   |   |   |   | 2,804 |   |   |   |   |
| Net                (loss)                                                                                                           |   |                        |   |       |   |                           |   |                               |    |                                |   | (10,433                                   | )      |   |   |   |   | (10,433 | ) | $ | (10,433 | ) |
| Change                in unrealized loss on marketable securities                                                                   |   |                        |   |       |   |                           |   |                               |    |                                |   |                                      |   |   | 79 |   |   | 79 |   |   | 79 |   |
|  **Balance                at March 31, 2007**                                                                                  |   |                        | 26,504 |       | $      | 34                             |   | $                                  | 327,067 |                                | $      | (220,791                                  | )      | $ | (66 | ) | $ | 106,244 |   | $ | (10,354 | ) |

**The      accompanying notes are an integral part of these condensed financial      statements.**

----

Index

**PROGENICS      PHARMACEUTICALS, INC.**

**CONDENSED      CONSOLIDATED STATEMENTS OF CASH FLOWS**

**(amounts      in thousands)**

**(Unaudited)**

|                                                                                                                                                      |   | **Three                months ended****March                31,** |    |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------------------------------|---------|
|                                                                                                                                                      |   | **2007**                                                          |    | **2006** |   |
| Cash                flows from operating activities:                                                                                                      |   |                                                              |         |   |   |  |   |
| Net                loss                                                                                                                                   |   | $                                                                 | (10,433 | ) | $ | (2,643 | ) |
| Adjustments                to reconcile net loss to net cash used in operating                activities:                                                 |   |                                                              |    |   |   |   |   |
| Depreciation                and amortization                                                                                                              |   |                                                              | 492     |   |   | 363 |   |
| Amortization                of discounts, net of premiums, on marketable securities                                                                       |   |                                                              | (49     | ) |   | 22 |   |
| Noncash                expenses incurred in connection with vesting of share-based payment                arrangements                                    |   |                                                              | 2,948   |   |   | 2,224 |   |
| Loss                in joint venture                                                                                                                      |   |                                                              |    |   |   | 121 |   |
| Changes                in assets and liabilities:                                                                                                         |   |                                                              |    |   |   |   |   |
| Decrease                in accounts receivable                                                                                                            |   |                                                              |    |   |   | 2,117 |   |
| Decrease                (increase) in other current assets and other assets                                                                               |   |                                                              | 346     |   |   | (698 | ) |
| Increase                (decrease) in accounts payable and accrued expenses                                                                               |   |                                                              | 1,133   |   |   | (3,690 | ) |
| Decrease                in other current liabilities                                                                                                      |   |                                                              |    |   |   | (153 | ) |
| Decrease                in deferred revenue                                                                                                               |   |                                                              | (5,272  | ) |   | (2,852 | ) |
| Increase                in deferred lease liability                                                                                                       |   |                                                              | 1       |   |   | 5 |   |
| Net                cash used in operating activities                                                                                                      |   |                                                              | (10,834 | ) |   | (5,184 | ) |
| Cash                flows from investing activities:                                                                                                      |   |                                                              |    |   |   |   |   |
| Capital                expenditures                                                                                                                       |   |                                                              | (1,067  | ) |   | (822 | ) |
| Sales                of marketable securities                                                                                                             |   |                                                              | 69,439  |   |   | 78,600 |   |
| Purchase                of marketable securities                                                                                                          |   |                                                              | (52,050 | ) |   | (113,760 | ) |
| (Increase)                in restricted cash                                                                                                              |   |                                                              | (2      | ) |   | (1 | ) |
| Net                cash provided by (used in) investing activities                                                                                        |   |                                                              | 16,320  |   |   | (35,983 | ) |
| Cash                flows from financing activities:                                                                                                      |   |                                                              |    |   |   |   |   |
| Proceeds                from the exercise of stock options and sale of Common Stock under                the                Employee Stock Purchase Plans |   |                                                              | 2,804   |   |   | 2,446 |   |
| Net                cash provided by financing activities                                                                                                  |   |                                                              | 2,804   |   |   | 2,446 |   |
| Net                increase (decrease) in cash and cash equivalents                                                                                       |   |                                                              | 8,290   |   |   | (38,721 | ) |
| Cash                and cash equivalents at beginning of period                                                                                           |   |                                                              | 11,947  |   |   | 67,072 |   |
|                    Cash and cash equivalents at end of period                                                                              |   | $                                                                 | 20,237  |   | $ | 28,351 |   |

**The      accompanying notes are an integral part of these condensed financial      statements.**

----

Index

**PROGENICS      PHARMACEUTICALS, INC.**

**NOTES      TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)**

**1.**
 I
**nterim      Financial Statements**

** **

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Index

**PROGENICS        PHARMACEUTICALS, INC.**

**NOTES        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS **
**¾**
**        continued (unaudited)**

**2.      Share-Based Payment Arrangements**

|                                                  |   | **For                the Three Months Ended****March                31,** |                       |
|-------------------------------------------------------|--------|---------------------------------------------------------------------------|----------------------------|
|                                                  |   | **2007**                                                                  |                       | **2006** |   |
|                                                  |   |                                                                      |                       |   |   |
| Expected                volatility                    |   |                                                                      | 55%                - 89%   |   |   | 94% |   |
| Expected                dividends                     |   |                                                                      | zero                       |   |   | zero |   |
| Expected                term (in years)               |   |                                                                      | 5.25                - 10   |   |   | 6.5 |   |
| Weighted                average expected term (years) |   |                                                                      | 9.0                        |   |   | 6.5 |   |
| Risk-free                rate                         |   |                                                                      | 4.4%                - 4.5% |   |   | 4.6% |   |

|                               |   | **For                the Three Months Ended****March                31,** |                    |
|------------------------------------|--------|---------------------------------------------------------------------------|-------------------------|
|                               |   | **2007**                                                                  |                    | **2006** |   |
|                               |   |                                                                      |                    |   |   |
| Expected                volatility |   |                                                                      | 40%                     |   |   | 38% |   |
| Expected                dividends  |   |                                                                      | zero                    |   |   | zero |   |
| Expected                term       |   |                                                                      | 6                months |   |   | 6                months |   |
| Risk-free                rate      |   |                                                                      | 5.1%                    |   |   | 3.3% |   |

----

Index

**PROGENICS      PHARMACEUTICALS, INC.**

**NOTES      TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS **
**¾**
**      continued (unaudited)**

**3.      Accounts Receivable**

|                                          |   | **March                31,****2007** |   |  **December                31,****2006** |   |
|-----------------------------------------------|--------|--------------------------------------|--------|-----------------------------------------------|--------|
| National                Institutes of Health  |   | $                                    | 1,697  |                                          | $      | 1,697 |   |
| Other                                         |   |                                 | 2      |                                          |   | 2 |   |
|                     Total |   | $                                    | 1,699  |                                          | $      | 1,699 |   |

**4.**
**Accounts      Payable and Accrued Expenses**

|                                               |   | **March                31,****2007** |   |  **December                31,****2006** |   |
|----------------------------------------------------|--------|--------------------------------------|--------|-----------------------------------------------|--------|
| Accounts                payable                    |   | $                                    | 809    |                                          | $      | 1,559 |   |
| Consulting                and clinical trial costs |   |                                 | 9,479  |                                          |   | 7,404 |   |
| Payroll                and related costs           |   |                                 | 978    |                                          |   | 990 |   |
| Legal                and professional fees         |   |                                 | 987    |                                          |   | 1,301 |   |
| Other                                              |   |                                 | 732    |                                          |   | 598 |   |
|                     Total      |   | $                                    | 12,985 |                                          | $      | 11,852 |   |

| **5.  ** | **Revenue                Recognition** |
|--------------------|----------------------------------------|

| **6.  ** | **Net                Loss Per Share** |
|--------------------|---------------------------------------|

|                                        |   | **Net                Loss (Numerator)** |    | **Shares                (Denominator)** |   | **Per                Share Amount** |   |
|--------------------------------------------------|--------|-----------------------------------------|---------|-----------------------------------------|--------|-------------------------------------|--------|
| Three                months ended March 31, 2007 |   |                                    |         |                                    |   |                                     |   |   |  |   |
| **Basic                and Diluted**             |   | $                                       | (10,433 | )                                       |   | 26,365                              |   | $ | (0.40 | ) |
| Three                months ended March 31, 2006 |   |                                    |    |                                    |   |                                |   |   |   |   |
| **Basic                and Diluted**             |   | $                                       | (2,643  | )                                       |   | 25,354                              |   | $ | (0.10 | ) |

----

Index

**PROGENICS        PHARMACEUTICALS, INC.**

**NOTES        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS **
**¾**
**        continued (unaudited)**

|                                          |   | **Three                Months Ended March 31,** |   |
|-----------------------------------------------|--------|-------------------------------------------------|--------|
|                                          |   | **2007**                                        |   | **2006** |   |
|                                          |   | **Wtd.                Avg. Number**             |   | **Wtd.                Avg. Exercise Price** |   | **Wtd.                Avg. Number** |   | **Wtd.                Avg. Exercise Price** |   |
| Stock                options                  |   |                                            | 4,689  |   | $ | 16.77 |   |   | 4,546 |   | $ | 14.00 |   |
| Nonvested                shares               |   |                                            | 395    |   |   |  |   |   | 243 |   |   |   |   |
|                     Total |   |                                            | 5,084  |   |   |  |   |   | 4,789 |   |   |  |   |

**7.        Uncertain Tax Positions**

*Accounting        for Uncertainty in Income Taxes—an Interpretation of FASB Statement        109*

** 8.  Comprehensive        Loss**

----

Index

**PROGENICS        PHARMACEUTICALS, INC.**

**NOTES        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS **
**¾**
**        continued (unaudited)**

|                                                                    |   | **Three                Months Ended****March                31,** |    |
|-------------------------------------------------------------------------|--------|-------------------------------------------------------------------|---------|
|                                                                    |   | **2007**                                                          |    | **2006** |   |
| Net                loss                                                 |   | $                                                                 | (10,433 | ) | $ | (2,643 | ) |
| Change                in net unrealized (loss) on marketable securities |   |                                                              | 79      |   |   | (141 | ) |
| Comprehensive                loss                                       |   | $                                                                 | (10,354 | ) | $ | (2,784 | ) |

**9.      Commitments and Contingencies**

**10.      Impact of Recently Issued Accounting Standards**

*Fair      Value Measurements*

*The      Fair Value Option for Financial Assets and Financial      Liabilities*

----

Index

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

**Special      Note Regarding Forward-Looking Statements**

**Overview**

***General***

***Gastroenterology***

----

Index

** **

***Virology***

***Oncology***

----

Index

**Results      of Operations  **
**(amounts      in**
**      thousands)**

**Revenues:**

|                                               |   | **Three                Months Ended****March                31,** |   |     |   |
|----------------------------------------------------|--------|-------------------------------------------------------------------|--------|----------|--------|
| **Sources                of Revenue**              |   | **2007**                                                          |   | **2006** |   | **Percent                Change** |   |
|                                               |   |                                                              |   |     |   |   |   |
| Contract                research from collaborator |   | $                                                                 | 15,499 |     | $      | 8,488 |   |   | 83% |   |
| Research                grants and contract        |   |                                                              | 2,119  |     |   | 2,462 |   |   | (14%) |   |
| Product                sales                       |   |                                                              | 19     |     |   | 51 |   |   | (63%) |   |
| Total                                              |   | $                                                                 | 17,637 |     | $      | 11,001 |   |   | 60% |   |

**Contract      research from collaborator**

*Critical      Accounting Policies -Revenue Recognition*

**Research      grants and contract**

**Product      sales**

----

Index

**Expenses:**

**Research      and Development Expenses:**

|                                            |   | **Three                Months Ended March 31,** |   |     |
|-------------------------------------------------|--------|-------------------------------------------------|--------|----------|
|                                            |   | **2007**                                        |   | **2006** |   | **Percent                Change** |
|                                            |   |                                            |   |     |   |   |
| **Salaries                and benefits (cash)** |   | $5,524                                          |   | $3,832   |   | 44% |

|                                                   |   | **Three                Months Ended March 31,** |   |     |
|--------------------------------------------------------|--------|-------------------------------------------------|--------|----------|
|                                                   |   | **2007**                                        |   | **2006** |   | **Percent                Change** |
|                                                   |   |                                            |   |     |   |   |
| **Share-based                compensation (non-cash)** |   | $1,615                                          |   | $1,193   |   | 35% |

*Critical      Accounting Policies − Share-Based Payment Arrangements, *

|                                    |   | **Three                Months Ended March 31,** |   |     |
|-----------------------------------------|--------|-------------------------------------------------|--------|----------|
|                                    |   | **2007**                                        |   | **2006** |   | **Percent                Change** |
|                                    |   |                                            |   |     |   |   |
| **Clinical                trial costs** |   | $4,649                                          |   | $1,607   |   | 189% |

|                                   |   | **Three                Months Ended March 31,** |   |     |
|----------------------------------------|--------|-------------------------------------------------|--------|----------|
|                                   |   | **2007**                                        |   | **2006** |   | **Percent                Change** |
|                                   |   |                                            |   |     |   |   |
| **Laboratory                supplies** |   | $1,657                                          |   | $927     |   | 79% |

|                                                         |   | **Three                Months Ended March 31,** |   |     |
|--------------------------------------------------------------|--------|-------------------------------------------------|--------|----------|
|                                                         |   | **2007**                                        |   | **2006** |   | **Percent                Change** |
|                                                         |   |                                            |   |     |   |   |
| **Contract                manufacturing and subcontractors** |   | $6,094                                          |   | $1,135   |   | 437% |

----

Index

|            |   | **Three                Months Ended March 31,** |   |     |
|-----------------|--------|-------------------------------------------------|--------|----------|
|            |   | **2007**                                        |   | **2006** |   | **Percent                Change** |
|            |   |                                            |   |     |   |   |
| **Consultants** |   | $1,571                                          |   | $572     |   | 175% |

* *

|                            |   | **Three                Months Ended March 31,** |   |     |
|---------------------------------|--------|-------------------------------------------------|--------|----------|
|                            |   | **2007**                                        |   | **2006** |   | **Percent                Change** |
|                            |   |                                            |   |     |   |   |
| **License                fees** |   | $750                                            |   | $275     |   | 173% |

|                                        |   | **Three                Months Ended March 31,** |   |     |
|---------------------------------------------|--------|-------------------------------------------------|--------|----------|
|                                        |   | **2007**                                        |   | **2006** |   | **Percent                Change** |
|                                        |   |                                            |   |     |   |   |
| **Other                operating expenses** |   | $1,311                                          |   | $1,017   |   | 29% |

**General      and Administrative Expenses:**

|                                            |   | **Three                Months Ended March 31,** |   |     |
|-------------------------------------------------|--------|-------------------------------------------------|--------|----------|
|                                            |   | **2007**                                        |   | **2006** |   | **Percent                Change** |
|                                            |   |                                            |   |     |   |   |
| **Salaries                and benefits (cash)** |   | $1,958                                          |   | $1,465   |   | 34% |

|                                                   |   | **Three                Months Ended March 31,** |   |     |
|--------------------------------------------------------|--------|-------------------------------------------------|--------|----------|
|                                                   |   | **2007**                                        |   | **2006** |   | **Percent                Change** |
|                                                   |   |                                            |   |     |   |   |
| **Share-based                compensation (non-cash)** |   | $1,333                                          |   | $1,030   |   | 29% |

*Critical      Accounting Policies − Share-Based Payment Arrangements, *

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Index

|                                                |   | **Three                Months Ended March 31,** |   |     |
|-----------------------------------------------------|--------|-------------------------------------------------|--------|----------|
|                                                |   | **2007**                                        |   | **2006** |   | **Percent                Change** |
|                                                |   |                                            |   |     |   |   |
| **Consulting                and professional fees** |   | $1,840                                          |   | $1,108   |   | 66% |

|                                        |   | **Three                Months Ended March 31,** |   |     |
|---------------------------------------------|--------|-------------------------------------------------|--------|----------|
|                                        |   | **2007**                                        |   | **2006** |   | **Percent                Change** |
|                                        |   |                                            |   |     |   |   |
| **Other                operating expenses** |   | $1,145                                          |   | $909     |   | 26% |

|                                     |   | **Three                Months Ended March 31,** |   |     |
|------------------------------------------|--------|-------------------------------------------------|--------|----------|
|                                     |   | **2007**                                        |   | **2006** |   | **Percent                Change** |
|                                     |   |                                            |   |     |   |   |
| **Loss                in Joint Venture** |   |                                            |   | $121     |   | (100%) |

|                                             |   | **Three                Months Ended March 31,** |   |     |
|--------------------------------------------------|--------|-------------------------------------------------|--------|----------|
|                                             |   | **2007**                                        |   | **2006** |   | **Percent                Change** |
|                                             |   |                                            |   |     |   |   |
| **Depreciation                and Amortization** |   | $492                                            |   | $363     |   | 36% |

|                            |   | **Three                Months Ended March 31,** |   |     |
|---------------------------------|--------|-------------------------------------------------|--------|----------|
|                            |   | **2007**                                        |   | **2006** |   | **Percent                Change** |
|                            |   |                                            |   |     |   |   |
| **Other                Income** |   | $1,869                                          |   | $1,910   |   | (2%) |

**Net      Loss:**

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Index

**Liquidity      and Capital Resources**

**Overview**

|                                           |   | **Three                Months Ended****March                31,** |    |
|------------------------------------------------|--------|-------------------------------------------------------------------|---------|
|                                           |   | **2007**                                                          |    | **2006** |   |
|                                           |   | **in                thousands**                                   |    |
|                                           |   |                                                              |    |
| Net                cash (used in) provided by: |   |                                                              |    |   |   |   |   |
| Operating                activities            |   | $                                                                 | (10,834 | ) | $ | (5,184 | ) |
| Investing                activities            |   |                                                              | 16,320  |   |   | (35,983 | ) |
| Financing                activities            |   |                                                              | 2,804   |   |   | 2,446 |   |

| ·   | Cash                used in operating activities for the three months ended March 31,                2007                resulted primarily from a net loss of $10.4 million, which was offset                by                $2.9 million of non-cash compensation expense from the issuance of                restricted stock and stock options to employees and non-employees                and $0.5                million of depreciation expense on our fixed assets. Significant                changes                in operating assets and liabilities between March 31, 2007 and December                31, 2006 were: a decrease of $5.3 million in deferred revenue resulting                from the amortization of the $60 million upfront payment received                from                Wyeth in 2005; and an increase of $1.1 million in accounts payable                and                accrued expenses, due to timing of payments. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

** **

| ·   | Net                cash used in investing activities for the three months ended March                31,                2007 resulted primarily from the sale of $69.4 million of marketable                securities offset by the purchase of $52.1 million of marketable                securities. We purchase and sell marketable securities in order to                provide                funding for our operations and to achieve appreciation of our unused                cash                in a low risk environment. We also purchased $1.1 million and $0.8                million                of fixed assets, during the three months ended March 31, 2007 and                2006,                respectively, including capital equipment and leasehold improvements                as we                acquired and built out additional manufacturing space and purchased                more                laboratory equipment for our expanding research and development                projects. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | The                net cash provided by financing activities for the three months ended                March                31, 2007 and 2006 includes the exercise of stock options under our                Stock                Incentive Plans and the sale of common stock under our Employee Stock                Purchase Plans. Cash received from exercises under such plans during                the                three months ended March 31, 2007 was more than that during the three                months ended March 31, 2006 due to an increase in                headcount. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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Index

**Sources      of Cash**

**Uses      of Cash**

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Index

|                          |   | **Three                Months Ended March 31,** |   |
|-------------------------------|--------|-------------------------------------------------|--------|
|                          |   | **2007**                                        |   | **2006** |   |
|                          |   | **(in                millions)**                |   |
| Methylnaltrexone              |   | $                                               | 10.2   |   | $ | 5.3 |   |
| HIV                           |   |                                            | 6.4    |   |   | 3.2 |   |
| Cancer                        |   |                                            | 4.8    |   |   | 1.6 |   |
| Other                programs |   |                                            | 1.8    |   |   | 0.5 |   |
| Total                         |   | $                                               | 23.2   |   | $ | 10.6 |   |

** **

**Contractual      Obligations**

|                                                    |   |                             |   | **Payments                due by March 31,** |   |
|---------------------------------------------------------|--------|----------------------------------|--------|----------------------------------------------|--------|
|                                                    |   | **Total**                        |   | **2008**                                     |   | **2009-2010** |   | **2011-2012** |   | **Thereafter** |   |
|                                                    |   | **(in                millions)** |   |
| Operating                leases                         |   | $                                | 7.5    |                                         | $      | 2.4 |   | $ | 4.2 |   | $ | 0.4 |   | $ | 0.5 |   |
| License                and collaboration agreements (1) |   |                             | 98.9   |                                         |   | 2.8 |   |   | 4.1 |   |   | 3.2 |   |   | 88.8 |   |
| Total                                                   |   | $                                | 106.4  |                                         | $      | 5.2 |   | $ | 8.3 |   | $ | 3.6 |   | $ | 89.3 |   |

| (1)   | Assumes                attainment of milestones covered under each agreement, including                those by                PSMA LLC. The timing of the achievement of the related milestones                is                highly uncertain, and accordingly the actual timing of payments,                if any,                is likely to vary, perhaps significantly, relative to the timing                contemplated by this table. |
|-----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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Index

**Off-Balance      Sheet Arrangements and Guarantees**

**Critical      Accounting Policies**

*Revenue      Recognition*

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Index

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Index

*Share-Based      Payment Arrangements*

*Share-Based      Payment*
*Accounting      for Equity Instruments that are Issued to Other Than Employees for Acquiring,      or      in Connection with Selling, Goods or Services*

| ·   | We                use the closing price of our common stock on the date of grant, as                quoted                on The NASDAQ Stock Market LLC, as the exercise price. |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Historical                volatilities are based upon daily quoted market prices of our common                stock                on The NASDAQ Stock Market LLC over a period equal to the expected                term of                the related equity instruments. We rely only on historical volatility                since future volatility is expected to be consistent with historical;                historical volatility is calculated using a simple average calculation;                historical data is available for the length of the option’s expected term                and a sufficient number of price observations are used consistently.                Since                our stock options are not traded on a public market, we do not use                implied                volatility. For the three months ended March 31, 2007 and 2006, the                volatility of our common stock for periods equal to the expected                term of                options granted during those periods has been high, 55% - 89% and                94%,                respectively, which is common for entities in the biotechnology industry                that do not have commercial products. A higher volatility input to                the                Black-Scholes model increases the resulting compensation expense. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | The                expected term of options granted represents the period of time that                options granted are expected to be outstanding. For the three months                ended                March 31, 2007, our expected term has been calculated based upon                historical data related to exercise and post-termination cancellation                activity for each of two groups of recipients of stock options: employees                and officers and directors. Accordingly, for grants made to each                of the                groups mentioned above, we are using expected terms of 5.25 and 7.5                years,                respectively. For the three months ended March 31, 2006,** **our                expected term was calculated based upon **t**he                simplified method as detailed in Staff Accounting Bulletin No. 107                (“SAB                107”). We used an expected term of 6.5 years for options granted in 2006,                based upon the vesting period of the outstanding options of four                or five                years and a contractual term of ten years. Expected term for options                granted to non-employee consultants was ten years, which is the                contractual term of those options. A shorter expected term would                result in                a lower compensation expense. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | We                have never paid dividends and do not expect to pay dividends in the                future. Therefore, our dividend rate is                zero. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | The                risk-free rate for periods within the expected term of the options                is                based on the U.S. Treasury yield curve in effect at the time of                grant. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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Index

*Accounting      under Statement 123 for Certain Employee Stock Purchase Plans with a Look-Back      Option*

*Clinical      Trial Expenses*

**Impact      of Recently Issued Accounting Standards**

*Fair      Value Measurements*

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Index

*The      Fair Value Option for Financial Assets and Financial      Liabilities*

**                     Item 3. Quantitative and Qualitative Disclosures about      Market Risk**

**                    Item 4. Controls and Procedures**

**PART      II —**
**OTHER      INFORMATION**

**Item      1A. Risk Factors**

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Index

**We      have a history of operating losses, and we may never be      profitable.**

**We      are likely to need additional financing, but our access to capital funding      is      uncertain.**

**Our      stock price has a history of volatility. You should consider an investment      in      our stock as risky and invest only if you can withstand a significant      loss.**

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| · | the                results of clinical trials and preclinical studies involving our                products                or those of our competitors; |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | changes                in the status of any of our drug development programs, including                delays in                clinical trials or program                terminations; |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | developments                regarding our efforts to achieve marketing approval for our                products; |
|--------|------------------------------------------------------------------------------------------------------------------|

| · | developments                in our relationship with Wyeth regarding the development and                commercialization of                methylnaltrexone; |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | announcements                of technological innovations or new commercial products by us, our                collaborators or our competitors; |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------|

| · | developments                in our relationships with other collaborative                partners; |
|--------|----------------------------------------------------------------------------------------------------|

| · | developments                in patent or other proprietary                rights; |
|--------|-----------------------------------------------------------------------------------|

| · | governmental                regulation; |
|--------|-----------------------------------------|

| · | changes                in reimbursement policies or health care                legislation; |
|--------|---------------------------------------------------------------------------------------------|

| · | public                concern as to the safety and efficacy of products developed by us,                our                collaborators or our competitors; |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | our                ability to fund on-going                operations; |
|--------|------------------------------------------------------------------------|

| · | fluctuations                in our operating results; and |
|--------|-----------------------------------------------------------|

| · | general                market conditions. |
|--------|-------------------------------------------|

**Our      principal stockholders are able to exert significant influence over matters      submitted to stockholders for approval.**

**              Item      6. Exhibits**

|   | (a) | Exhibits |
|--------|-----|----------|

| 10.6 | Form                of Indemnification Agreement                                                                                                                                                                                                                                                                                                               |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 31.1 | Certification                of Paul J. Maddon, M.D., Ph.D., Chief Executive Officer of the Registrant,                pursuant to Rule 13a-14(a) and Rule 15d-14(a) under the Securities                Exchange Act of 1934, as amended                                                                                                                      |
| 31.2 | Certification                of Robert A. McKinney, Chief Financial Officer and Senior Vice President,                Finance and Operations (Principal Financial and Accounting Officer)                of the                Registrant, pursuant to Rule 13a-14(a) and Rule 15d-14(a) under the                Securities Exchange Act of 1934, as amended  |
| 32   | Certification                pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section                906 of                the Sarbanes-Oxley Act of 2002                                                                                                                                                                                                 |

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Index

**SIGNATURES**

|                             | **PROGENICS                PHARMACEUTICALS, INC.** |
|----------------------------------|----------------------------------------------------|
| Date:                May 9, 2007 | By:                                                | **/s/                Robert A. McKinney** |
|                             |                                               | Robert                A. McKinneyChief                Financial OfficerSenior                Vice President, Finance & Operations and Treasurer(Duly                authorized officer of the Registrant and Principal Financial and                Accounting Officer) |