----

----

**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**

----

----

----

**PROGENICS PHARMACEUTICALS,      INC.**

**INDEX**

|                       |                                                                                                                                                                                                                          | **Page                No.** |
|----------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------|
| **Part                I**  | **FINANCIAL                INFORMATION**                                                                                                                                                                                      |                        |
| Item                1.     | Consolidated                Financial Statements                (unaudited)                                                                                                                                                   | 3                           |
|                       | Condensed                Consolidated                Balance Sheets                at                September                30, 2007                and December 31, 2006                                                   | 3                           |
|                       | Condensed                Consolidated                Statements                of                Operations for the Three and Nine Months                ended September                30, 2007                and 2006      | 4                           |
|                       | Condensed                Consolidated                Statement                of                Stockholders’ Equity and Comprehensive Loss for the Nine                Months ended September                30, 2007  | 5                           |
|                       | Condensed                Consolidated                Statements                of Cash                Flows for the Nine                Months ended                September                30, 2007                and 2006 | 6                           |
|                       | Notes                to                Condensed ConsolidatedFinancial                Statements                                                                                                                              | 7                           |
| Item                2.     | Management’s                Discussion and Analysis of Financial Condition and Results of                Operations                                                                                                     | 14                          |
| Item                3.     | Quantitative                and                Qualitative Disclosures about Market Risk                                                                                                                                      | 31                          |
| Item                4.     | Controls                and                Procedures                                                                                                                                                                         | 31                          |
|                       |                                                                                                                                                                                                                          |                        |
| **PART                II** | **OTHER                INFORMATION**                                                                                                                                                                                          |                        |
| Item                1A.    | Risk                Factors                                                                                                                                                                                                   | 32                          |
| Item                6.     | Exhibits                                                                                                                                                                                                                      | 43                          |
|                       | Signatures                                                                                                                                                                                                                    | 44                          |
|                       | Certifications                                                                                                                                                                                                                |                        |

----

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)**

|                                                                                                                                                                 |   | **September                30,****2007** |     |   | **December                31,****2006** |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------------------|----------|--------|-----------------------------------------|--------|
| **Assets**                                                                                                                                                           |   |                                     |     |   |                                    |   |
| Current                assets:                                                                                                                                       |   |                                     |     |   |                                    |   |
| Cash                and cash equivalents                                                                                                                             |   | $                                        | 64,368   |   |                                    | $      | 11,947 |   |
| Marketable                securities                                                                                                                                 |   |                                     | 81,293   |   |                                    |   | 113,841 |   |
| Accounts                receivable                                                                                                                                   |   |                                     | 2,204    |   |                                    |   | 1,699 |   |
| Other                current assets                                                                                                                                  |   |                                     | 2,555    |   |                                    |   | 3,181 |   |
| Total                current assets                                                                                                                                  |   |                                     | 150,420  |   |                                    |   | 130,668 |   |
| Marketable                securities                                                                                                                                 |   |                                     | 37,918   |   |                                    |   | 23,312 |   |
| Fixed                assets, at cost, net of accumulated depreciation and                amortization                                                                |   |                                     | 13,602   |   |                                    |   | 11,387 |   |
| Restricted                cash                                                                                                                                       |   |                                     | 549      |   |                                    |   | 544 |   |
| Total                assets                                                                                                                                          |   | $                                        | 202,489  |   |                                    | $      | 165,911 |   |
|                                                                                                                                                                 |   |                                     |     |   |                                    |   |   |   |
| **Liabilities                and Stockholders’ Equity**                                                                                                        |   |                                     |     |   |                                    |   |   |   |
| Current                liabilities:                                                                                                                                  |   |                                     |     |   |                                    |   |   |   |
| Accounts                payable and accrued expenses                                                                                                                 |   | $                                        | 15,613   |   |                                    | $      | 11,852 |   |
|        Deferred                revenue ¾                current                                                              |   |                                     | 16,675   |   |                                    |   | 26,989 |   |
| Other                current liabilities                                                                                                                             |   |                                     | 57       |   |                                    |   |   |   |
| Total                current liabilities                                                                                                                             |   |                                     | 32,345   |   |                                    |   | 38,841 |   |
| Deferred                revenue — long term                                                                                                                    |   |                                     | 12,163   |   |                                    |   | 16,101 |   |
| Other                liabilities                                                                                                                                     |   |                                     | 355      |   |                                    |   | 123 |   |
| Total                liabilities                                                                                                                                     |   |                                     | 44,863   |   |                                    |   | 55,065 |   |
| Commitments                and contingencies (Note  10)                                                                                                         |   |                                     |     |   |                                    |   |   |   |
| 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 — 29,612,583 in 2007 and 26,199,016 in 2006 |   |                                     | 38       |   |                                    |   | 34 |   |
| Additional                paid-in capital                                                                                                                            |   |                                     | 396,371  |   |                                    |   | 321,315 |   |
| Accumulated                deficit                                                                                                                                   |   |                                     | (238,774 | )      |                                    |   | (210,358 | ) |
| Accumulated                other comprehensive (loss)                                                                                                                |   |                                     | (9       | )      |                                    |   | (145 | ) |
| Total                stockholders’ equity                                                                                                                      |   |                                     | 157,626  |   |                                    |   | 110,846 |   |
| Total                liabilities and stockholders’ equity                                                                                                      |   | $                                        | 202,489  |   |                                    | $      | 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** |    |   | **For                the Nine Months Ended** |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------|---------|--------|----------------------------------------------|--------|
|                                                                                                                                             |   | **September                30,**              |    |   | **September                30,**             |   |
|                                                                                                                                             |   | **2007**                                      |    |   | **2006**                                     |   |   | **2007** |   |   | **2006** |   |
| Revenues:                                                                                                                                        |   |                                          |    |   |                                         |   |   |   |   |   |   |   |
|     Contract                research and development from collaborator                                                       |   | $                                             | 14,540  |   |                                         | $      | 14,527 |   |   | $ | 52,987 |   |   | $ | 40,060 |   |
|       Research                grants and contract                                                                  |   |                                          | 2,471   |   |                                         |   | 3,316 |   |   |   | 7,077 |   |   |   | 7,842 |   |
|       Product                sales                                                                                 |   |                                          | 7       |   |                                         |   | 5 |   |   |   | 48 |   |   |   | 70 |   |
| Total                revenues                                                                                                                    |   |                                          | 17,018  |   |                                         |   | 17,848 |   |   |   | 60,112 |   |   |   | 47,972 |   |
|                                                                                                                                             |   |                                          |    |   |                                         |   |   |   |   |   |   |   |   |   |   |   |
| Expenses:                                                                                                                                        |   |                                          |    |   |                                         |   |   |   |   |   |   |   |   |   |   |   |
|      Research                and development                                                                            |   |                                          | 24,247  |   |                                         |   | 15,751 |   |   |   | 69,999 |   |   |   | 43,079 |   |
|      In-process                research and development                                                                 |   |                                          |    |   |                                         |   |   |   |   |   |   |   |   |   | 13,209 |   |
|      General                and administrative                                                                          |   |                                          | 9,275   |   |                                         |   | 6,610 |   |   |   | 21,746 |   |   |   | 16,138 |   |
|      Loss                in joint venture                                                                               |   |                                          |    |   |                                         |   |   |   |   |   |   |   |   |   | 121 |   |
|      Depreciation                and amortization                                                                       |   |                                          | 845     |   |                                         |   | 381 |   |   |   | 2,144 |   |   |   | 1,106 |   |
| Total                expenses                                                                                                                    |   |                                          | 34,367  |   |                                         |   | 22,742 |   |   |   | 93,889 |   |   |   | 73,653 |   |
|                                                                                                                                             |   |                                          |    |   |                                         |   |   |   |   |   |   |   |   |   |   |   |
| Operating                loss                                                                                                                    |   |                                          | (17,349 | )      |                                         |   | (4,894 | ) |   |   | (33,777 | ) |   |   | (25,681 | ) |
|                                                                                                                                             |   |                                          |    |   |                                         |   |   |   |   |   |   |   |   |   |   |   |
| Other                income:                                                                                                                     |   |                                          |    |   |                                         |   |   |   |   |   |   |   |   |   |   |   |
|       Interest                income                                                                               |   |                                          | 1,749   |   |                                         |   | 1,959 |   |   |   | 5,361 |   |   |   | 5,775 |   |
|                                                                                                                                             |   |                                          |    |   |                                         |   |   |   |   |   |   |   |   |   |   |   |
| Net                loss                                                                                                                          |   | $                                             | (15,600 | )      |                                         | $      | (2,935 | ) |   | $ | (28,416 | ) |   | $ | (19,906 | ) |
|                                                                                                                                             |   |                                          |    |   |                                         |   |   |   |   |   |   |   |   |   |   |   |
| Net                loss per share - basic and diluted                                                                                            |   | $                                             | (0.58   | )      |                                         | $      | (0.11 | ) |   | $ | (1.07 | ) |   | $ | (0.78 | ) |
|               Weighted-average                  shares - basic and diluted |   |                                          | 26,976  |   |                                         |   | 25,783 |   |   |   | 26,639 |   |   |   | 25,570 |   |

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

----

Index

**PROGENICS      PHARMACEUTICALS, INC.**

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

**FOR      THE NINE MONTHS ENDED SEPTEMBER 30, 2007**

**(amounts      in thousands)**

**(Unaudited)**

|                                                                                                                                                                                                                |   | Common                Stock |   |   |        |   |   |                                      |   |   |                                    |   |   |                                                                |     |   |                                           |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------|--------|--------|--------|--------|--------|-------------------------------------------|--------|--------|------------------------------------|--------|--------|---------------------------------------------------------------------|----------|--------|------------------------------------------------|--------|
|                                                                                                                                                                                                                |   | Shares                      |   |   | Amount |   |   | Additional                Paid-In Capital |   |   | Accumulated                Deficit |   |   | Accumulated                OtherComprehensive                (Loss) |     |   | TotalStockholders’                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                                                                                                                                 |   |                        |   |   |   |   |   |                                      |   |   |   11,840                 |   |   |                                                                |     |   |                                           |   |   |   |   |   | 11,840 |   |   |   |   |
|  Issuance                of restricted stock, net of forfeitures                                                                                                                                               |   |                        | 245    |   |   |   |   |                                      |   |   |                               |   |   |                                                                |     |   |                                           |   |   |   |   |   |   |   |   |   |   |
|  Sale                of common stock in a public offering ($23.15 per share, net of                underwriting discounts and commissions and other offering expenses                of                $3,058) |   |                        | 2,600  |   |   |   | 3      |                                      |   |   | 57,129                             |   |   |                                                                |     |   |                                           |   |   |   |   |   | 57,132 |   |   |   |   |
|  Sale                of Common Stock under employee stock purchase plans and exercise                of stock                options                                                                           |   |                        | 569    |   |   |   | 1      |                                      |   |   | 6,106                              |   |   |                                                                |     |   |                                           |   |   |   |   |   | 6,107 |   |   |   |   |
|  Repurchase                of restricted stock                                                                                                                                                                 |   |                        |   |   |   |   |   |                                      |   |   | (19                                | )      |   |                                                                |     |   |                                           |   |   |   |   |   | (19 | ) |   |   |   |
|  Net                (loss)                                                                                                                                                                                     |   |                        |   |   |   |   |   |                                      |   |   |                               |   |   |                                                                | (28,416  | )      |                                           |   |   |   |   |   | (28,416 | ) |   | $ | (28,416 | ) |
|  Change                in unrealized loss on marketable securities                                                                                                                                             |   |                        |   |   |   |   |   |                                      |   |   |                               |   |   |                                                                |     |   |                                           |   | 136 |   |   |   | 136 |   |   |   | 136 |   |
|  **                       Balance at September 30, 2007**                                                                                                                   |   |                        | 29,613 |   |   | $      | 38     |                                      |   | $      | 396,371                            |   |   | $                                                                   | (238,774 | )      |                                           | $      | (9 | ) |   | $ | 157,626 |   |   | $ | (28,280 | ) |

**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)**

|                                                                                                                                                     |   | **For                the Nine Months Ended****September                30,** |     |
|----------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------------------------------------------|----------|
|                                                                                                                                                     |   | **2007**                                                                          |     |   | **2006** |   |
| Cash                flows from operating activities:                                                                                                     |   |                                                                              |     |   |   |   |
| Net                loss                                                                                                                                  |   | $                                                                                 | (28,416  | ) |   | $ | (19,906 | ) |
| Adjustments                to reconcile net loss to net cash used in operating                activities:                                                |   |                                                                              |     |   |   |   |   |   |
| Depreciation                and amortization                                                                                                             |   |                                                                              | 2,144    |   |   |   | 1,106 |   |
| Amortization                of discounts, net of premiums, on marketable securities                                                                      |   |                                                                              | (354     | ) |   |   | 27 |   |
| Noncash                expenses incurred in connection with vesting of share-based compensation                awards                                    |   |                                                                              | 11,840   |   |   |   | 9,132 |   |
| Expense                of purchased technology related to PSMA LLC                                                                                       |   |                                                                              |     |   |   |   | 13,209 |   |
| Loss                in joint venture                                                                                                                     |   |                                                                              |     |   |   |   | 121 |   |
| Write-off                of fixed assets                                                                                                                 |   |                                                                              |     |   |   |   | 2 |   |
| Changes                in assets and liabilities, net of effects of purchase of PSMA                LLC:                                                 |   |                                                                              |     |   |   |   |   |   |
| (Increase)                decrease in accounts receivable                                                                                                |   |                                                                              | (505     | ) |   |   | 301 |   |
| Decrease                (increase) in other current assets                                                                                               |   |                                                                              | 626      |   |   |   | (8 | ) |
| Increase                in accounts payable and accrued expenses                                                                                         |   |                                                                              | 3,761    |   |   |   | 1,073 |   |
| (Decrease)                in amount due to joint venture                                                                                                 |   |                                                                              |     |   |   |   | (194 | ) |
| Decrease                in investment in joint venture                                                                                                   |   |                                                                              |     |   |   |   | 250 |   |
| (Decrease)                in deferred revenue                                                                                                            |   |                                                                              | (14,252  | ) |   |   | (14,466 | ) |
| Increase                (decrease) in other current liabilities                                                                                          |   |                                                                              | 57       |   |   |   | (790 | ) |
| Increase                in other liabilities                                                                                                             |   |                                                                              | 232      |   |   |   | 51 |   |
| Net                cash (used in) operating activities                                                                                                   |   |                                                                              | (24,867  | ) |   |   | (10,092 | ) |
| Cash                flows from investing activities:                                                                                                     |   |                                                                              |     |   |   |   |   |   |
| Capital                expenditures                                                                                                                      |   |                                                                              | (4,359   | ) |   |   | (6,511 | ) |
| Sales                of marketable securities                                                                                                            |   |                                                                              | 188,997  |   |   |   | 236,212 |   |
| Purchase                of marketable securities                                                                                                         |   |                                                                              | (170,565 | ) |   |   | (264,425 | ) |
| Acquisition                of PSMA LLC, net of cash acquired                                                                                             |   |                                                                              |     |   |   |   | (13,128 | ) |
|            Increase                in restricted cash                                             |   |                                                                              | (5       | ) |   |   | (5 | ) |
| Net                cash provided by (used in) investing activities                                                                                       |   |                                                                              | 14,068   |   |   |   | (47,857 | ) |
| Cash                flows from financing activities:                                                                                                     |   |                                                                              |     |   |   |   |   |   |
| Proceeds                from the sale of common stock in a public offering (see Note                5)                                                   |   |                                                                              | 60,190   |   |   |   |   |   |
| Expenses                related to the sale of common stock in a public offering                                                                         |   |                                                                              | (3,058   | ) |   |   |   |   |
| Proceeds                from the exercise of stock options and sale of common stock under                the                Employee Stock Purchase Plan |   |                                                                              | 6,107    |   |   |   | 5,309 |   |
|            Repurchase                of restricted stock                                          |   |                                                                              | (19      | ) |   |   |   |   |
| Net                cash provided by financing activities                                                                                                 |   |                                                                              | 63,220   |   |   |   | 5,309 |   |
| Net                increase (decrease) in cash and cash equivalents                                                                                      |   |                                                                              | 52,421   |   |   |   | (52,640 | ) |
| Cash                and cash equivalents at beginning of period                                                                                          |   |                                                                              | 11,947   |   |   |   | 67,072 |   |
| Cash                and cash equivalents at end of period                                                                                                |   | $                                                                                 | 64,368   |   |   | $ | 14,432 |   |
| Supplemental                disclosure of noncash investing activity:                                                                                    |   |                                                                              |     |   |   |   |   |   |
| Fair                value of assets, including purchased technology, acquired from PSMA                LLC                                               |   |                                                                              |     |   |   | $ | 13,674 |   |
| Cash                paid for acquisition of PSMA LLC                                                                                                     |   |                                                                              |     |   |   |   | (13,459 | ) |
| Liabilities                assumed from PSMA LLC                                                                                                         |   |                                                                              |     |   |   | $ | 215 |   |

**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**

----

Index

**PROGENICS            PHARMACEUTICALS,            INC.**

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

**2.      Share-Based Payment Arrangements**

|                                                  |   | **For                the Nine Months Ended****September                30,** |
|-------------------------------------------------------|--------|------------------------------------------------------------------------------|
|                                                  |   | **2007**                                                                     |   | **2006** |
|                                                  |   |                                                                         |   |   |
| Expected                volatility                    |   | 52%                - 85%                                                     |   | 88% |
| Expected                dividends                     |   | zero                                                                         |   | zero |
| Expected                term (in years)               |   | 5.25                - 10                                                     |   | 6.5 |
| Weighted                average expected term (years) |   | 6.75                                                                         |   | 6.5 |
| Risk-free                rate                         |   | 4.77%                - 4.93%                                                 |   | 4.74% |

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

|                               |   | **For                the Nine Months Ended****September                30,** |
|------------------------------------|--------|------------------------------------------------------------------------------|
|                               |   | **2007**                                                                     |   | **2006** |
|                               |   |                                                                         |   |   |
| Expected                volatility |   | 43%                                                                          |   | 43% |
| Expected                dividends  |   | zero                                                                         |   | zero |
| Expected                term       |   | 6                months                                                      |   | 6                months |
| Risk-free                rate      |   | 4.78%                                                                        |   | 4.47% |

----

Index

**PROGENICS            PHARMACEUTICALS,            INC.**

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

**3.      Accounts Receivable**

|                                                              |   | **September                30,****2007** |   |   | **December                31,****2006** |   |
|-------------------------------------------------------------------|--------|------------------------------------------|--------|--------|-----------------------------------------|--------|
|                      National Institutes of Health |   | $                                        | 2,200  |   |                                    | $      | 1,697 |   |
| Other                                                             |   |                                     | 4      |   |                                    |   | 2 |   |
|                      Total               |   | $                                        | 2,204  |   |                                    | $      | 1,699 |   |

**4**

**.**

**Accounts      Payable and Accrued      Expenses**

|                                                       |   | **September                30,****2007** |   |   | **December                31,****2006** |   |
|------------------------------------------------------------|--------|------------------------------------------|--------|--------|-----------------------------------------|--------|
| Accounts                payable                            |   | $                                        | 1,528  |   |                                    | $      | 1,559 |   |
| Accrued                consulting and clinical trial costs |   |                                     | 9,829  |   |                                    |   | 7,404 |   |
| Accrued                payroll and related costs           |   |                                     | 2,115  |   |                                    |   | 990 |   |
| Legal                and professional fees                 |   |                                     | 1,559  |   |                                    |   | 1,301 |   |
| Other                                                      |   |                                     | 582    |   |                                    |   | 598 |   |
|                     Total              |   | $                                        | 15,613 |   |                                    | $      | 11,852 |   |

**5.          **Stockholders’        Equity****

----

Index

**PROGENICS            PHARMACEUTICALS,            INC.**

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

**6.    Revenue      Recognition**

**7.         Net Loss Per Share**

|                                                |   | **Net                Loss (Numerator)** |    |   | **Shares                (Denominator)** |   |   | **Per                Share Amount** |   |
|----------------------------------------------------------|--------|-----------------------------------------|---------|--------|-----------------------------------------|--------|--------|-------------------------------------|--------|
| **Three                months ended September 30, 2007** |   |                                    |    |   |                                    |   |   |                                |   |
| Basic                and Diluted                         |   | $                                       | (15,600 | )      |                                    |   | 26,976 |                                |   | $ | (0.58 | ) |
| **Nine                months ended September 30, 2007**  |   |                                    |    |   |                                    |   |   |                                |   |   |   |   |
| Basic                and Diluted                         |   | $                                       | (28,416 | )      |                                    |   | 26,639 |                                |   | $ | (1.07 | ) |
| **Three                months ended September 30, 2006** |   |                                    |    |   |                                    |   |   |                                |   |   |   |   |
| Basic                and Diluted                         |   | $                                       | (2,935  | )      |                                    |   | 25,783 |                                |   | $ | (0.11 | ) |
| **Nine                months ended September 30, 2006**  |   |                                    |    |   |                                    |   |   |                                |   |   |   |   |
| Basic                and Diluted                         |   | $                                       | (19,906 | )      |                                    |   | 25,570 |                                |   | $ | (0.78 | ) |

----

Index

**PROGENICS            PHARMACEUTICALS,            INC.**

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

|                                          |   | **For                the Three Months Ended September 30,** |   |
|-----------------------------------------------|--------|-------------------------------------------------------------|--------|
|                                          |   | **2007**                                                    |   |   | **2006** |   |
|                                          |   | **Wtd.                Avg. Number**                         |   |   | **Wtd.                Avg. Exercise Price** |   |   | **Wtd.                Avg. Number** |   |   | **Wtd.                Avg. Exercise Price** |   |
| Stock                options                  |   |                                                        | 4,832  |   |   | $ | 17.90 |   |   |   | 4,856 |   |   | $ | 15.74 |   |
| Nonvested                shares               |   |                                                        | 512    |   |   |   |   |   |   |   | 369 |   |   |   |   |   |
|                     Total |   |                                                        | 5,344  |   |   |   |   |   |   |   | 5,225 |   |   |   |   |   |

|                                          |   | **For                the Nine Months Ended September 30,** |   |
|-----------------------------------------------|--------|------------------------------------------------------------|--------|
|                                          |   | **2007**                                                   |   |   | **2006** |   |
|                                          |   | **Wtd.                Avg. Number**                        |   |   | **Wtd.                Avg. Exercise Price** |   |   | **Wtd.                Avg. Number** |   |   | **Wtd.                Avg. Exercise Price** |   |
| Stock                options                  |   |                                                       | 4,688  |   |   | $ | 17.36 |   |   |   | 4,625 |   |   | $ | 14.79 |   |
| Nonvested                shares               |   |                                                       | 428    |   |   |   |   |   |   |   | 286 |   |   |   |   |   |
|                     Total |   |                                                       | 5,116  |   |   |   |   |   |   |   | 4,911 |   |   |   |   |   |

| **8.   Uncertain                Tax Positions** |
|----------------------------------------------------------------|

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

----

Index

**PROGENICS            PHARMACEUTICALS,            INC.**

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

**9.       Comprehensive Loss**

|                                                                         |   | **For                the Three Months Ended****September                30,** |    |   | **For                the Nine Months Ended****September                30,** |   |
|------------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------|---------|--------|------------------------------------------------------------------------------|--------|
|                                                                         |   | **2007**                                                                      |    |   | **2006**                                                                     |   |   | **2007** |   |   | **2006** |   |
| Net                loss                                                      |   | $                                                                             | (15,600 | )      |                                                                         | $      | (2,935 | ) |   | $ | (28,416 | ) |   | $ | (19,906 | ) |
| Change                in net unrealized gain (loss) on marketable securities |   |                                                                          | 206     |   |                                                                         |   | 73 |   |   |   | 136 |   |   |   | (123 | ) |
|                     Comprehensive loss                   |   | $                                                                             | (15,394 | )      |                                                                         | $      | (2,862 | ) |   | $ | (28,280 | ) |   | $ | (20,029 | ) |

**10.  Comm**

**itments      and      Contingencies**

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

*Fair Value      Measurements*

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

----

Index

**PROGENICS            PHARMACEUTICALS,            INC.**

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

*Accounting for Collaborative Arrangements *
*.*
*Reporting Revenue Gross as      a Principal versus Net as an Agent*
*The Equity Method of Accounting for Investments in Common      Stock*

*Accounting for Advance Payments for Goods or Services to      Be Used in Future Research and Development Activities*
*Accounting for Research and      Development Costs*

----

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

** **

----

Index

***Virology***

***Oncology***

----

Index

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

**Revenues:**

|                                                     |   | **  For                the  Three Months Ended  ****September                30,** |   | **        For                the Nine Months Ended****September                30,** |
|----------------------------------------------------------|--------|-----------------------------------------------------------------------------------------------------------------------|--------|------------------------------------------------------------------------------------------------------------------------------|
|                                                     |   | **      2007**                                                                          |   | **2006**                                                                                                                     |   | **Percent****Change** |   | **    2007** |   | **     2006** |   | **Percent****Change** |
| **Sources                of Revenue**                    |   |                                                                                                                  |   |                                                                                                                         |   |   |   |   |   |   |   |   |
|                                                     |   |                                                                                                                  |   |                                                                                                                         |   |   |   |   |   |   |   |   |
| Contract                research from  collaborator |   | $     14,540                                                                                 |   | $     14,527                                                                                        |   | 0% |   | $     52,987 |   | $     40,060 |   | 32% |
| Research                grants and contract              |   |           2,471                                                     |   |          3,316                                                                  |   | (25%) |   | 7,077 |   |        7,842 |   | (10%) |
| Product                sales                             |   | 7                                                                                                                     |   |                 5                            |   | 40% |   | 48 |   |             70 |   | (31%) |
|       Total                |   | $     17,018                                                                                 |   | $     17,848                                                                                        |   | (5%) |   | $     60,112 |   | $     47,972 |   | 25% |

**Contract      research from collaborator**

*Critical Accounting Policies –Revenue Recognition*

----

Index

**Research      grants and contract**

**Product      sales**

**Expenses:**

**Research      and Development Expenses:**

|                                                                    |   |  **Three                Months Ended**** September                30,** |   | **Percent****Change** |   | **Nine                Months Ended****September                30,** |   | **Percent****Change**      |
|-------------------------------------------------------------------------|--------|-----------------------------------------------------------------------------------|--------|-----------------------|--------|----------------------------------------------------------------------|--------|----------------------------|
|                                                                    |   | **    2007**                                                  |   | **2006**              |   |                                                                 |   | **   2007** |   | **    2006** |   |   |
|                                                                    |   |                                                                              |   |                  |   |                                                                 |   |                       |   |   |   |   |
| **    Salaries                and benefits (cash)** |   | $5,939                                                                            |   | $4,345                |   | 37%                                                                  |   | $17,876                    |   | $12,150 |   | 47% |

*Three      Months: *

*Nine      Months: *

----

Index

|                                                        |   |  **                   Three Months Ended****September                30,** |   | **Percent****Change** |   | **Nine                Months Ended****September                30,** |   | **Percent****Change**            |
|-------------------------------------------------------------|--------|------------------------------------------------------------------------------------------------|--------|-----------------------|--------|----------------------------------------------------------------------|--------|----------------------------------|
|                                                        |   | **    2007**                                                               |   | **2006**              |   |                                                                 |   | **    2007** |   | **    2006** |   |   |
|                                                        |   |                                                                                           |   |                  |   |                                                                 |   |                             |   |   |   |   |
| **Share-based compensation                (non-cash)** |   | $1,829                                                                                         |   | $1,655                |   | 11%                                                                  |   | $5,004                           |   | $4,136 |   | 21% |

*Three      Months: *
*Critical Accounting Policies −Share-Based Payment Arrangements*
*,*
* *

*Nine      Months: *
*Critical Accounting Policies −Share-Based Payment Arrangements*
*,*
* *

|                                                            |   |  **    Three                Months Ended****September                30,** |   | **Percent****Change** |   | **Nine                Months Ended****September                30,** |   | **Percent****Change**            |
|-----------------------------------------------------------------|--------|-----------------------------------------------------------------------------------------------------|--------|-----------------------|--------|----------------------------------------------------------------------|--------|----------------------------------|
|                                                            |   | **    2007**                                                                    |   | **2006**              |   |                                                                 |   | **    2007** |   | **    2006** |   |   |
|                                                            |   |                                                                                                |   |                  |   |                                                                 |   |                             |   |   |   |           |
| **    Clinical                trial costs** |   | $6,124                                                                                              |   | $1,896                |   | 223%                                                                 |   | $14,520                          |   | $5,795 |   | 151% |

*Three        Months: *

*Nine        Months:  *

|                                                           |   |  **                   Three Months Ended****September                30,** |   | **Percent****Change** |   | **Nine                Months Ended****September                30,** |   | **Percent****Change**            |
|----------------------------------------------------------------|--------|------------------------------------------------------------------------------------------------|--------|-----------------------|--------|----------------------------------------------------------------------|--------|----------------------------------|
|                                                           |   | **    2007**                                                               |   | **2006**              |   |                                                                 |   | **    2007** |   | **    2006** |   |   |
|                                                           |   |                                                                                           |   |                  |   |                                                                 |   |                             |   |   |   |   |
| **    Laboratory                supplies** |   | $1,765                                                                                         |   | $2,191                |   | (19%)                                                                |   | $5,616                           |   | $4,261 |   | 32% |

*Three      Months: *

*Nine      Months: *

----

Index

|                                                         |   |  **    Three                Months Ended**** September                30,** |   | **Percent****Change** |   | **Nine                Months Ended****September                30,** |   | **Percent****Change**            |
|--------------------------------------------------------------|--------|-----------------------------------------------------------------------------------------------------------|--------|-----------------------|--------|----------------------------------------------------------------------|--------|----------------------------------|
|                                                         |   | **    2007**                                                                          |   | **2006**              |   |                                                                 |   | **    2007** |   | **    2006** |   |   |
|                                                         |   |                                                                                                      |   |                  |   |                                                                 |   |                             |   |   |   |   |
| **Contract                manufacturing and subcontractors** |   | $6,008                                                                                                    |   | $2,605                |   | 131%                                                                 |   | $17,906                          |   | $8,651 |   | 107% |

*Three        Months: *

*Nine        Months: *

|                                    |   |  **    Three                Months Ended**** September                30,** |   | **Percent****Change** |   | **Nine                Months Ended****September                30,** |   | **Percent****Change**            |
|-----------------------------------------|--------|-----------------------------------------------------------------------------------------------------------|--------|-----------------------|--------|----------------------------------------------------------------------|--------|----------------------------------|
|                                    |   | **    2007**                                                                          |   | **2006**              |   |                                                                 |   | **    2007** |   | **    2006** |   |   |
|                                    |   |                                                                                                      |   |                  |   |                                                                 |   |                             |   |   |   |   |
| **    Consultants** |   | $934                                                                                                      |   | $1,628                |   | (43%)                                                                |   | $3,636                           |   | $3,722 |   | (2%) |

* *
*Three        Months: *

*Nine        Months: *

|                                                    |   |  **    Three                Months Ended****September                30,** |   | **Percent****Change** |   | **Nine                Months Ended****September                30,** |   | **Percent****Change**            |
|---------------------------------------------------------|--------|-----------------------------------------------------------------------------------------------------|--------|-----------------------|--------|----------------------------------------------------------------------|--------|----------------------------------|
|                                                    |   | **    2007**                                                                    |   | **2006**              |   |                                                                 |   | **    2007** |   | **    2006** |   |   |
|                                                    |   |                                                                                                |   |                  |   |                                                                 |   |                             |   |   |   |   |
| **    License                fees** |   | ($16)                                                                                               |   | $100                  |   | (116%)                                                               |   | $833                             |   | $528 |   | 58% |

*Three        Months: *

*Nine        Months: *

----

Index

|                                                                |   |  **    Three                Months Ended****September                30,** |   | **Percent****Change** |   | **Nine                Months Ended****September                30,** |   | **Percent****Change**            |
|---------------------------------------------------------------------|--------|-----------------------------------------------------------------------------------------------------|--------|-----------------------|--------|----------------------------------------------------------------------|--------|----------------------------------|
|                                                                |   | **    2007**                                                                    |   | **2006**              |   |                                                                 |   | **    2007** |   | **    2006** |   |   |
|                                                                |   |                                                                                                |   |                  |   |                                                                 |   |                             |   |   |   |   |
| **    Other                operating expenses** |   | $1,664                                                                                              |   | $1,331                |   | 25%                                                                  |   | $4,608                           |   | $17,045 |   | (73%) |

*Three      *
*Months:*

*Nine      Months: *

**General      and Administrative Expenses:**

|                                                                    |   |  **    Three                Months Ended**** September                30,** |   | **Percent****Change** |   | **Nine                Months Ended****September                30,** |   | **Percent****Change**            |
|-------------------------------------------------------------------------|--------|-----------------------------------------------------------------------------------------------------------|--------|-----------------------|--------|----------------------------------------------------------------------|--------|----------------------------------|
|                                                                    |   | **    2007**                                                                          |   | **2006**              |   |                                                                 |   | **    2007** |   | **    2006** |   |   |
|                                                                    |   |                                                                                                      |   |                  |   |                                                                 |   |                             |   |   |   |   |
| **    Salaries                and benefits (cash)** |   | $1,641                                                                                                    |   | $1,556                |   | 5%                                                                   |   | $5,418                           |   | $4,516 |   | 20% |

*Three      Months: *

*Nine      Months*
*: *

|                                                   |   |  **    Three                Months Ended****September                30,** |   | **Percent****Change** |   | **Nine                Months Ended****September                30,** |   | **Percent****Change**            |
|--------------------------------------------------------|--------|-----------------------------------------------------------------------------------------------------|--------|-----------------------|--------|----------------------------------------------------------------------|--------|----------------------------------|
|                                                   |   | **    2007**                                                                    |   | **2006**              |   |                                                                 |   | **    2007** |   | **    2006** |   |   |
|                                                   |   |                                                                                                |   |                  |   |                                                                 |   |                             |   |   |   |   |
| **Share-based                compensation (non-cash)** |   | $4,337                                                                                              |   | $2,731                |   | 59%                                                                  |   | $6,836                           |   | $4,999 |   | 37% |

*Three      Months: *
*Critical Accounting Policies − Share-Based      Payment Arrangements*
*,*
* *

----

Index

*Nine      Months: *
*Critical Accounting Policies − Share-Based      Payment Arrangements*
*,*
* *

|                                                |   |  **    Three                Months Ended**** September                30,** |   | **Percent****Change** |   | **Nine                Months Ended****September                30,** |   | **Percent****Change**            |
|-----------------------------------------------------|--------|-----------------------------------------------------------------------------------------------------------|--------|-----------------------|--------|----------------------------------------------------------------------|--------|----------------------------------|
|                                                |   | **    2007**                                                                          |   | **2006**              |   |                                                                 |   | **    2007** |   | **    2006** |   |   |
|                                                |   |                                                                                                      |   |                  |   |                                                                 |   |                             |   |   |   |   |
| **Consulting                and professional fees** |   | $1,856                                                                                                    |   | $1,461                |   | 27%                                                                  |   | $5,601                           |   | $3,693 |   | 52% |

*Three        Months: *

*Nine        Months: *

|                                                                |   |  **    Three                Months Ended**** September                30,** |   | **Percent****Change** |   | **Nine                Months Ended****September                30,** |   | **Percent****Change**            |
|---------------------------------------------------------------------|--------|-----------------------------------------------------------------------------------------------------------|--------|-----------------------|--------|----------------------------------------------------------------------|--------|----------------------------------|
|                                                                |   | **    2007**                                                                          |   | **2006**              |   |                                                                 |   | **    2007** |   | **    2006** |   |   |
|                                                                |   |                                                                                                      |   |                  |   |                                                                 |   |                             |   |   |   |   |
| **    Other                operating expenses** |   | $1,441                                                                                                    |   | $862                  |   | 67%                                                                  |   | $3,891                           |   | $2,930 |   | 33% |

*Three        Months: *

*Nine        Months:  *

|                                                             |   |  **    Three                Months Ended****September                30,** |   | **Percent****Change** |   | **Nine                Months Ended****September                30,** |   | **Percent****Change**            |
|------------------------------------------------------------------|--------|-----------------------------------------------------------------------------------------------------|--------|-----------------------|--------|----------------------------------------------------------------------|--------|----------------------------------|
|                                                             |   | **    2007**                                                                    |   | **2006**              |   |                                                                 |   | **    2007** |   | **    2006** |   |   |
|                                                             |   |                                                                                                |   |                  |   |                                                                 |   |                             |   |   |   |   |
| **    Loss                in Joint Venture** |   | $0                                                                                                  |   | $0                    |   | 0%                                                                   |   | $0                               |   | $121 |   | (100%) |

|                                                                     |   |  **  Three                Months Ended****September                30,** |   | **Percent****Change** |   | **Nine                Months Ended****September                30,** |   | **Percent****Change**            |
|--------------------------------------------------------------------------|--------|-----------------------------------------------------------------------------------------|--------|-----------------------|--------|----------------------------------------------------------------------|--------|----------------------------------|
|                                                                     |   | **   2007**                                                              |   | **2006**              |   |                                                                 |   | **    2007** |   | ** 2006** |   |   |
|                                                                     |   |                                                                                    |   |                  |   |                                                                 |   |                             |   |   |   |   |
| **    Depreciation                and amortization** |   | $845                                                                                    |   | $381                  |   | 122%                                                                 |   | $2,144                           |   | $1,106 |   | 94% |

*Three      Months: *

----

Index

*Nine      Months: *

|                                                    |   |  **    Three                Months Ended****September                30,** |   | **Percent****Change** |   | **Nine                Months Ended****September                30,** |   | **Percent****Change**            |
|---------------------------------------------------------|--------|-----------------------------------------------------------------------------------------------------|--------|-----------------------|--------|----------------------------------------------------------------------|--------|----------------------------------|
|                                                    |   | **    2007**                                                                    |   | **2006**              |   |                                                                 |   | **    2007** |   | **    2006** |   |   |
|                                                    |   |                                                                                                |   |                  |   |                                                                 |   |                             |   |   |   |   |
| **    Other                income** |   | $1,749                                                                                              |   | $1,959                |   | (11%)                                                                |   | $5,361                           |   | $5,775 |   | (7%) |

*Three      Months: *

*Nine      Months: *

**Net      Loss:**

**Liquidity      and Capital Resources**

**Overview**

**Sources      of Cash**

*** Operating      Activities***

----

Index

*** Investing      Activities***

***Financing      Activities***

----

Index

**Uses      of Cash**

***Operating      Activities***

|                          |   | **Nine                Months Ended September 30,** |                      |
|-------------------------------|--------|----------------------------------------------------|---------------------------|
|                          |   | **2007**                                           |                      |   | **2006** |   |
|                          |   | **(in                millions)**                   |                      |
| Methylnaltrexone              |   | $                                                  | 30.9                      |   |   | $ |                               23.2 |   |
| HIV                           |   |                                               | 19.1                      |   |   |   | 11.3 |   |
| Cancer                        |   |                                               | 13.5                      |   |   |   | 19.3 |   |
| Other                programs |   |                                               |                  6.5 |   |   |   |                  2.5 |   |
| Total                         |   | $                                                  | 70.0                      |   |   | $ | 56.3 |   |

***Investing      Activities***

** **

----

Index

**Contractual      Obligations**

|                                                    |   |                             |   |   | **Payments                due by September 30,** |   |
|---------------------------------------------------------|--------|----------------------------------|--------|--------|--------------------------------------------------|--------|
|                                                    |   | **Total**                        |   |   | **2008**                                         |   |   | ** ** | **2009-2010** |   |   | ** ** | **2011-2012** |   |   | **Thereafter** |   |
|                                                    |   | **(in                millions)** |   |
| Operating                leases                         |   | $                                | 7.7    |   |                                             | $      | 2.8 |   |   | $ | 3.8 |   |   | $ | 0.7 |   |   | $ | 0.4 |   |
| License                and collaboration agreements (1) |   |                             | 99.4   |   |                                             |   | 3.0 |   |   |   | 6.5 |   |   |   | 4.2 |   |   |   | 85.7 |   |
|      Total                     |   | $                                | 107.1  |   |                                             | $      | 5.8 |   |   | $ | 10.3 |   |   | $ | 4.9 |   |   | $ | 86.1 |   |

| (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. |
|-----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**Off-Balance      Sheet Arrangements      and Guarantees**

**Critical      Accounting Policies**

----

Index

*Revenue      Recognition*

*Revenue Recognition*
*Accounting for Revenue Arrangements with Multiple Deliverables*
*Reporting Revenue Gross as a      Principal Versus Net as an Agent*

----

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*

----

Index

| ·   | 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 nine months ended September 30, 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, 52% -                85%  and 88%, 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 nine months                ended                September 30, 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 nine months ended September 30,                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. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

Index

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

*Research      and Development Expenses Including Clinical Trial      Expenses*

**Impact      of Recently Issued Accounting Standards**

*Fair Value      Measurem*
*ents*

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

----

Index

*Accounting for Collaborative Arrangements *
*. *
*Reporting Revenue Gross as      a Principal versus Net as an Agent*
*The Equity Method of Accounting for Investments in Common      Stock*

*Accounting for Advance Payments for Goods or Services to      Be Used in Future Research and Development Activities*
*Accounting for Research and      Development Costs*

**              Item      3.  **

**Q**

**uantitative and      Qualitative Disclosures about Market Risk**

**                    Item 4.  Controls and      Procedures**

----

Index

**PART      II —**

**OTHER      INFORMATION**

**Item      1A. RiskFactors**

**Our      product development programs are inherently risky.**

**We      have granted to Wyeth the exclusive rights to develop and commercialize      methylnaltrexone, our lead product candidate, and our resulting dependence      upon      Wyeth exposes us to significant risks.**

----

Index

**If      testing does not yield successful results, our products will not be      approved.**

| ·   |                        potential products may not have the desired efficacy or may have                  undesirable side effects or other characteristics                  that |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

Index

**A      setback in our clinical development programs could adversely affect      us.**

**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.**

----

Index

**Our      clinical trials could take longer than we expect.**

| ·   |  deaths                or other adverse medical events involving patients or subjects in                our                clinical trials; |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   |  regulatory                or patent issues; |
|--------------------|---------------------------------------------------|

| ·   |  interim                or final results of ongoing clinical                trials; |
|--------------------|------------------------------------------------------------------------------------------|

| ·   |  failure                to enroll clinical sites as                expected; |
|--------------------|-----------------------------------------------------------------------------------|

| ·   |  competition                for enrollment from clinical trials conducted by others in similar                indications; |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------|

| ·   |  scheduling                conflicts with participating clinicians and clinical institutions;                and |
|--------------------|-----------------------------------------------------------------------------------------------------------------------|

| ·   |  manufacturing                problems. |
|--------------------|----------------------------------------------|

----

Index

**We      are subject to extensive regulation, which can be costly and time consuming      and      can subject us to unanticipated fines and delays.**

**Our      products do not yet have, and may never obtain, the regulatory approvals needed      for marketing.**

**Even      if our products obtain marketing approval, they might not be accepted in the      marketplace.**

**Marketplace      acceptance will depend in part on competition in our industry, which is      intense.**

----

Index

**One      or more competitors developing an opioid antagonist may reach the market ahead      of us and adversely affect the market potential for      methylnaltrexone.**

**If      we are unable to negotiate collaborative agreements, our cash burn rate could      increase and our rate of product development could      decrease.**

**If      we do not remedy our failure to achieve milestones or satisfy conditions      regarding some of our product candidates, we may not maintain our rights under      our licenses relating to these product candidates.**

**We      have limited manufacturing capabilities, which could adversely impact our      ability to commercialize products.**

----

Index

**We      are dependent on our patents and other intellectual property rights. The      validity, enforceability and commercial value of these rights are highly      uncertain.**

**If      we infringe third-party patent or other intellectual property rights, we may      need to alter or terminate a product development program.**

----

Index

**We      are dependent upon third parties for a variety of functions. These arrangements      may not provide us with the benefits we expect.**

**We      lack sales and marketing infrastructure and related staff, which will require      significant investment to establish and in the meantime may make us dependent      on      third parties for their expertise in this area.**

**If      we lose key management and scientific personnel on whom we depend, our business      could suffer.**

----

Index

**If      we are unable to obtain sufficient quantities of the raw and bulk materials      needed to make our products, our product development and commercialization      could      be slowed or stopped.**

**A      substantial portion of our funding comes from federal government grants and      research contracts. We cannot rely on these grants or contracts as a continuing      source of funds.**

**If      health care reform measures are enacted, our operating results and our ability      to commercialize products could be adversely affected.**

**We      are exposed to product liability claims, and in the future we may not be able      to      obtain insurance against these claims at a reasonable cost or at      all.**

----

Index

**We      handle hazardous materials and must comply with environmental laws and      regulations, which can be expensive and restrict how we do business. If we      are      involved in a hazardous waste spill or other accident, we could be liable for      damages, penalties or other forms of censure.**

**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.**

----

Index

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

| ·   |                     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.**

----

Index

**Anti-takeover      provisions may make the removal of our Board of Directors or management more      difficult and discourage hostile bids for control of our company that may be      beneficial to our stockholders.**

**If      there are substantial sales of our common stock, the market price of our common      stock could decline.**

**Item      6. Exhibits**

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

| 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                                                                                                                                                                                                                      |

----

Index

**SIGNATURES**

|                                  | **PROGENICS                PHARMACEUTICALS, INC.** |
|---------------------------------------|----------------------------------------------------|
| Date:                November 8, 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) |