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                                                                    Exhibit 99.1


                                  RISK FACTORS

You should carefully consider the risks below before making an investment
decision. The risks and uncertainties described below are not the only ones we
face. Additional risks and uncertainties not presently known to us or that we
currently deem immaterial may also impair our business operations.

This report also contains forward-looking statements that involve risks and
uncertainties. Our actual results could differ materially from those anticipated
in these forward-looking statements as a result of certain factors, including
the risks faced by us described below and elsewhere in this report.

                         RISKS RELATING TO OUR BUSINESS

OUR ACQUISITION STRATEGY COULD HAVE A MATERIAL AND ADVERSE EFFECT ON US.

We have increased our net revenues and net income through acquisitions of
branded products, and we intend to pursue additional acquisition opportunities.
The acquisition prices that we pay for branded products are based upon many
factors, including our analysis of sales history, cost of goods sold,
manufacturing and supply sources, marketing potential, brand strength,
competition and product improvement opportunities. While we carefully analyze
the prices that we pay, we may have overpaid, or may in the future overpay, for
a branded product line that may not produce sufficient cash flow to repay our
debt, including indebtedness incurred in connection with the acquisition, or
provide an acceptable rate of return on our investment.

When we determine the purchase price for acquired product lines, we rely in
large part on levels of past sales of the products. We do not know, however,
whether past levels of product sales can be sustained, even with our sales
promotion of, and improvements and line extensions to, these acquired product
lines. Sales of an acquired product line may be deteriorating or trending down
as we purchase it, and we may not be able to stop or reverse this trend. Any
prolonged decrease in sales of these products or their failure to return to the
sales levels existing prior to their acquisition will have a material adverse
effect on our business, results of operations and financial condition.

Our growth strategy is dependent upon our ability to develop line extensions or
improvements related to our acquired branded products and acquire branded
products that can be promoted through our marketing and distribution channels.

Despite our strong relationships with many large pharmaceutical companies which
are or have been our customers, other companies, including those with
substantially greater financial, marketing and sales resources, are competing
with us to acquire the same products. As a result, we may not be able to acquire
rights to additional products or may pay too much when we acquire them.

Additionally, our acquisitions will be dependent upon our ability to obtain
necessary financing. Our senior credit facilities and senior subordinated notes
limit our ability to obtain additional debt financing. Difficulties encountered
in developing line extensions or improvements to acquired products may delay and
increase the cost of a development project, requiring additional external
funding. Events beyond our control, such as war, terrorist attacks and their
aftermath, may adversely affect capital markets and limit our ability to obtain
the equity or debt financing that we would need to pursue additional product
acquisitions. The inability to effect acquisitions of additional branded
products could have a material adverse effect on our future business, financial
condition and results of operations.



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WE ARE DEPENDENT ON THIRD PARTIES FOR CERTAIN ESSENTIAL BUSINESS FUNCTIONS, AND
PROBLEMS WITH THESE THIRD-PARTY ARRANGEMENTS COULD MATERIALLY ADVERSELY AFFECT
OUR ABILITY TO MANUFACTURE AND SELL PRODUCTS AND OUR BUSINESS, FINANCIAL
CONDITION AND RESULTS OF OPERATIONS.

We are dependent on third parties for the manufacture of our acquired products.
We have entered into agreements with third parties for many of our product
manufacturing requirements. Our manufacturing dependence upon third parties may
adversely affect our profit margins and our ability to deliver our products on a
timely and competitive basis. If we are unable to retain or replace third-party
manufacturers on commercially acceptable terms, we may not be able to distribute
our products as planned. If we encounter delays or difficulties with contract
manufacturers in producing or packaging our products, the distribution,
marketing and subsequent sales of these products would be adversely affected,
and we may have to seek alternative sources of supply, lose sales or abandon or
divest a product line on unsatisfactory terms. We may be unable to enter into
alternative supply arrangements at commercially acceptable rates on a timely
basis, if at all. The manufacturers that we utilize may not be able to provide
us with sufficient quantities of our products, and the products supplied to us
may not meet our specifications. Moreover, failure of our contract manufacturers
to follow good manufacturing practices as mandated by the FDA would suspend or
halt manufacturing at these sites. Additionally, modifications, enhancements or
changes in manufacturing sites of approved products are subject to FDA approval
that we may or may not be able to obtain and that may be subject to a lengthy
application process.

Our acquired products are subject to interim supply agreements, each with terms
generally not exceeding three years. After expiration of these contracts, our
manufacturing costs could be higher and the move of the manufacturing of any of
our products will cause us to incur significant start-up costs associated with
that move. Additionally, any move of the manufacturing site of any of these
products would require FDA approval of the new manufacturing facility. FDA
approval, however, is not within our control, and we may not receive it for a
long time, if at all.

We are dependent on third parties for the supply of critical raw materials.
Sales of our products are dependent on our ability to obtain FDA-approved
supplies of raw materials, including active and inactive pharmaceutical
ingredients, and packaging materials, at commercially acceptable prices and
terms, in time to satisfy critical product development, testing, analytical and
manufacturing activities, customer contracts, or our development plans. The FDA
must approve the supply source of many ingredients for our products. The
qualification of a new supply source could delay the manufacture of the drug
involved. Arrangements with our foreign suppliers are subject to certain
additional risks, including the availability of governmental clearances, export
duties, political instability, currency fluctuations and restrictions on the
transfer of funds. Any constraints on the supply of raw materials could
materially and adversely affect our business, financial condition and results of
operations.

We use, and are dependent on, a contract distribution program. We have
contracted with two national pharmaceutical product distribution companies to
provide warehousing, product distribution, inventory tracking, customer service
and financial administrative assistance related to our product distribution
program. We are dependent on the capabilities of these third parties to
distribute our products effectively. We do not have extensive experience
performing these functions ourselves and may suffer significant disruption if we
have to do so or find alternative providers. The failure to adequately support
our distribution could have a material adverse effect on our business, financial
condition and results of operations.



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OUR SUCCESS IS DEPENDENT UPON A LIMITED NUMBER OF KEY PRODUCT LINES, WHICH MEANS
THAT ANY UNFAVORABLE DEVELOPMENTS WITH RESPECT TO ANY ONE PRODUCT LINE COULD
MATERIALLY AND ADVERSELY AFFECT US.

We have a significant investment in a limited number of key product lines. Each
of our branded product lines, and particularly Darvon and Darvocet, will
represent a significant portion of our total product sales for the foreseeable
future. Our pharmaceuticals division lines represented 56% of our net revenues
and 64% of our gross margin dollars (before depreciation expense) for 2002.
Accordingly, any factor adversely affecting sales of any of our branded
products, such as any problem with their safety or efficacy, could have a
material adverse effect on our business, financial condition and results of
operations. In addition, any perceived problems with our products could have a
similar material adverse effect. We are aware of press and consumer advocate
reports challenging the safety of Darvon and Darvocet, alleging that these
products are addictive, are not effective and have caused fatalities in the case
of overdoses. Challenges to the safety and efficacy of Darvon and Darvocet could
have a material adverse effect on our business, financial condition and results
of operations.

WE ENCOUNTER AGGRESSIVE COMPETITION IN ALL AREAS OF OUR BUSINESS.

The pharmaceutical industry is highly competitive and innovative. Our branded
products are in competition with branded products marketed and promoted by many
other pharmaceutical companies, including large, fully integrated companies with
financial, marketing, legal and product development resources substantially
greater than ours. Additional competitors may emerge to compete directly with us
for acquisitions of branded product lines, any of which could materially
adversely affect our ability to successfully make additional acquisitions of
branded product lines or our ability to sell our products on a successful basis.
We also compete with pharmaceutical companies in developing, marketing and
promoting our own internally developed pharmaceutical products. Because the
sales prices of pharmaceutical products typically decline as competition
increases, this competition could materially adversely affect us.

Our branded products are subject to generic competition. There is no proprietary
protection for most of the branded pharmaceutical products that we sell, and as
a result our branded pharmaceutical products are or may become subject to
competition from generic substitutes. These generic substitutes for our branded
products are sold by competitors at significantly lower prices than branded
products, due to the significantly lower costs associated with them. These
generic products may be precisely identical, in every respect, to the
higher-priced branded drugs we sell. In addition, governmental and other
pressures, including from third-party payers such as health maintenance
organizations, or HMOs, and health insurers to reduce pharmaceutical costs may
result in physicians or pharmacies increasingly using generic substitutes for
our products. Further, Congress is currently considering legislation that would,
if enacted, reduce regulatory obstacles to approval of generic products.
Additional state and federal legislation may be considered in the future that
would adversely affect sales of branded pharmaceutical products in favor of
generic products, such as laws more broadly mandating substitution of generic
products for prescriptions written for branded products. Competition from
generic products or additional legislation or regulatory developments favoring
generic products could cause the revenues from our branded products to decrease
significantly and could have a material and adverse effect on our business,
financial condition and results of operations. In addition, consideration of
legislative or regulatory changes that favor generic products or press reports
of possible changes may adversely affect the trading price of our common stock.

Newly developed branded products could adversely affect the commercially
valuable life of our products. The rapid product development and technological
changes occurring in the pharmaceutical industry could render our branded
products obsolete or uneconomical. New drugs to treat the conditions addressed
by our products could emerge. For example, we believe that sales of Darvon and
Darvocet decreased significantly in the early and mid-1990s, due to the
introduction of Oxycontin and the COX-2 class of drugs, which were



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thought to be superior to Darvon and Darvocet. In fact, companies that sell or
have sold us a particular product line could be developing a competing product
line to replace the line they are selling or have sold to us. Our competitors
also may be able to complete the product regulatory approval process before us
and, therefore, begin marketing their products in advance of our products.
Additionally, technological advances, which could affect the efficacy, approval,
cost, production or marketing of products, could benefit our competitors without
similarly aiding us. Our business, financial condition and results of operations
could be materially and adversely affected by any one or more of these
developments.

Our development services business is subject to increasing competitive
pressures. We are also subject to the impact of marketplace actions of our
competitors in our development services business. For example, in the event of
business difficulties or changes in market supply and demand for products, a
competitor may decide to cut the price of its products or take other pricing or
market actions in order to sell its products at any price. These actions could
disrupt the entire marketplace, resulting in potential reduced revenues for us,
either from responsive pricing reductions or a reduction in customer contracts
for our services. This could adversely affect our business, financial condition
and results of operations.

WE MAY INCUR SUBSTANTIAL EXPENSE TO DEVELOP PRODUCTS THAT WE NEVER SUCCESSFULLY
COMMERCIALIZE.

We will incur substantial research and development expenses, and other expenses,
attempting to develop new or improved products or product line extensions. These
expenses will substantially exceed our prior research and development expenses.
The products or line extensions to which we devote operational and financial
resources could be commercial failures. Successful commercialization of products
and product line extensions requires accurate anticipation of market and
customer acceptance of particular products, customers' needs and emerging
technological trends, among other things. Additionally, we must complete many
complex formulation and analytical testing requirements and obtain regulatory
approvals from the FDA and other regulatory agencies. When developed, new or
reformulated drugs may not exhibit desired characteristics. Complications can
also arise during production scale-up. Our products and line extensions may
encounter unexpected, irresolvable patent conflicts or not have enforceable
intellectual property rights. Delays or problems also may arise from internal
conflicts for resource availability, personnel errors or equipment failures. If
we incur significant expenses for a product or line extension that we do not
successfully commercialize, there could be a material adverse effect on our
business, financial condition and results of operations.

WE MAY BE UNABLE TO SECURE OR ENFORCE ADEQUATE INTELLECTUAL PROPERTY RIGHTS TO
PROTECT THE NEW PRODUCTS OR TECHNOLOGIES WE DEVELOP, AND OUR EXISTING
INTELLECTUAL PROPERTY RIGHTS MAY NOT BE ADEQUATE TO PROTECT US OR PROVIDE US
WITH A COMPETITIVE ADVANTAGE.

Our ability to successfully commercialize new branded products or technologies
is dependent upon our ability to secure and enforce strong intellectual property
rights, generally patents, and we may be unable to do so. To obtain patent
protection we must be able to successfully persuade the U.S. Patent and
Trademark Office and its foreign counterparts to issue patents on a timely basis
and possibly in the face of third-party challenges. Even if we are granted a
patent, our rights may later be challenged or circumvented by third parties. The
issuance of a patent is not conclusive as to its validity or enforceability. In
addition, from time to time, we have received notices from third parties
regarding patent claims against us. Any such claims, with or without merit,
could be time-consuming to defend, result in costly litigation, divert our
management's attention and resources, and cause us to incur significant
expenses. In addition, any potential intellectual property litigation could
require that we stop selling our products, obtain a license from the owner to
sell or use the relevant intellectual property, which we may not be able to
obtain on favorable terms, if at all, or modify our products to avoid using the
relevant intellectual property. In the event of a



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successful claim of infringement against us, our business, financial condition
and results of operations could be materially and adversely affected.

Additionally, we also rely on trade secrets and other unprotected proprietary
knowledge, which we generally seek to protect by confidentiality, non-disclosure
and assignment of invention agreements with our employees, consultants,
licensees and other companies. These agreements, however, may be breached, may
not be enforceable or we may not have adequate remedies for a breach by the
other party. Additionally, our trade secrets may become known by our
competitors. Parties to those agreements may claim rights to intellectual
property arising out of their work. The disclosure or misappropriation of our
intellectual property for any of these reasons could materially and adversely
affect our business, financial condition or results of operations.

WE MAY BE UNABLE TO OBTAIN GOVERNMENT APPROVAL FOR OUR PRODUCTS OR COMPLY WITH
GOVERNMENT REGULATIONS RELATING TO OUR BUSINESS.

The commercialization of pharmaceutical products is subject to extensive
federal, state and local regulation in the United States and similar foreign
regulation. We do not know the extent to which we may be affected by legislative
and other regulatory actions and developments concerning various aspects of our
operations, our products and the health care field generally. We do not know
what effect changes in governmental regulation and other actions or decisions by
governmental agencies may have on our business in the future. Any changes could
require changes to manufacturing methods or facilities, expanded or different
labeling, new approvals, the recall, replacement or discontinuance of certain
products, additional record keeping, and expanded documentation of the
properties of certain products and scientific substantiation. Any regulatory
changes could have a material adverse effect on our business, financial
condition and results of operations or our competitive position.

The manufacturing, processing, formulation, packaging, labeling, distribution,
importation, pricing, reimbursement and advertising of our products, and
disposal of waste products arising from these activities, are also subject to
regulation by the Drug Enforcement Administration, the Federal Trade Commission,
the Consumer Product Safety Commission, the U.S. Department of Agriculture, the
Occupational Safety and Health Administration, the U.S. Environmental Protection
Agency, the U.S. Customs Service and the Centers for Medicare and Medicaid
Services, as well as state, local and foreign governments.

We are required to obtain approval from the FDA based upon pre-clinical testing,
clinical trials showing safety and effectiveness, chemistry and manufacturing
control data, and other data and information before marketing most drug
products. The generation of the required data is regulated by the FDA and can be
time-consuming and expensive, and the results might not justify approval. Our
FDA product filings may not be approved in a timely manner, if at all, and we
may be unable to meet other regulatory requirements for our products.
Pharmaceutical products also must be distributed, sampled, advertised and
promoted in accordance with FDA requirements.

Even if we are successful in obtaining all required pre-marketing approvals,
post-marketing requirements and our failure to comply with other regulations
could result in suspension or limitation of approvals. The FDA could also
require reformulation of products during the post-marketing stage. For example,
prior to our acquisition of the M.V.I. and Aquasol product lines, the FDA
determined that M.V.I.-12, an adult multivitamin injectable product, must be
reformulated (along with other similar adult multivitamin products) to include
higher doses of Vitamins B1, B6, C and folic acid and to add Vitamin K. Our
formulation development laboratory has been working closely with AstraZeneca on
this reformulation.

All of our drugs must be manufactured in conformity with current Good
Manufacturing Practice regulations, as interpreted and enforced by the FDA, and
drug products subject to an FDA-approved application must be



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manufactured, processed, packaged, held and labeled in accordance with
information contained in the application. Additionally, modifications,
enhancements or changes in manufacturing sites of approved products are, in many
circumstances, subject to FDA approval, which may be subject to a lengthy
application process or which we may be unable to obtain. Our facilities,
including the facilities used in our development services business, and those of
our third-party manufacturers, are periodically subject to inspection by the FDA
and other governmental agencies, and operations at these facilities could be
interrupted or halted if such inspections are unsatisfactory.

Failure to comply with FDA or other governmental regulations can result in
fines, unanticipated compliance expenditures, recall or seizure of products,
total or partial suspension of production or distribution, suspension of the
FDA's review of our product applications, termination of ongoing research,
disqualification of data for submission to regulatory authorities, enforcement
actions, injunctions and criminal prosecution. Under certain circumstances, the
FDA also has the authority to revoke previously granted drug approvals. Although
we have instituted internal compliance programs, if our compliance is deficient
in any significant way, it could have a material adverse effect on us. Most of
our suppliers are subject to similar regulations and periodic inspections.

The federal health care program antikickback statute makes it illegal for anyone
to knowingly and willfully make or receive "kickbacks" in return for any health
care item or service reimbursed under any federally financed healthcare program.
This statute applies to arrangements between pharmaceutical companies and the
persons to whom they market, promote, sell and distribute their products.
Federal false claims laws prohibit any person from knowingly making a false
claim to the federal government for payment. Recently, several pharmaceutical
companies have been prosecuted under these laws, even though they did not submit
claims to government healthcare programs. The prosecutors alleged that they were
inflating drug prices they report to pricing services, which are in turn used by
the government to set Medicare and Medicaid reimbursement rates. Pharmaceutical
companies also have been prosecuted under these laws for allegedly providing
free products to customers with the expectation that the customers would bill
federal programs for the products. Additionally, the majority of states have
laws similar to the federal antikickback law and false claims laws. Sanctions
under these federal and state laws include monetary penalties, exclusion from
reimbursement for products under government programs, criminal fines and
imprisonment. While we have internal policies and practices requiring and
detailing compliance with the health care fraud and abuse laws and false claims
laws, it is possible that some of our business practices could be subject to
challenge under one or more of these laws, which could have a material adverse
effect on our business, financial condition and results of operations.

Additionally, our business involves the controlled storage, use and disposal of
hazardous or highly potent materials and biological hazardous materials. We are
subject to numerous environmental laws and regulations in the jurisdictions in
which we operate. Although we believe that our safety procedures for handling
and disposing of these hazardous materials comply in all material respects with
the standards prescribed by law and regulation in each of our locations, the
risk of accidental contamination or injury from hazardous materials cannot be
completely eliminated. In the event of an accident, we could be held liable to
governmental authorities or private parties for any damages that result, and the
liability could exceed our resources. In addition, we may be held liable for
costs associated with contamination of our currently or formerly occupied
properties, or at other parties' disposal sites where we disposed of hazardous
wastes, even though this contamination may have been caused by third parties or
the disposal may have complied with the regulatory requirements then in place.
Current or future environmental laws and regulations, or adverse changes in the
way current laws and regulations are interpreted or enforced, may materially
adversely affect our business, financial condition and results of operations. We
maintain liability insurance for some environmental risks that our management
believes to be appropriate and in accordance with industry practice. However, we
may incur liabilities beyond the limits or outside the coverage of our insurance
and may not be able to maintain insurance on acceptable terms.



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In connection with our activities outside the U.S., we are subject to foreign
regulatory requirements governing the testing, approval, manufacture, labeling,
marketing and sale of pharmaceutical products. These requirements vary from
country to country. Even if FDA approval has been obtained for a product,
approval by comparable regulatory authorities of foreign countries must be
obtained prior to marketing the product in those countries. For example, some of
our foreign operations are subject to regulations by the European Medicines
Evaluations Agency and the U.K. Medicines Control Agency. The approval process
may be more or less rigorous from country to country, and the time required for
approval may be longer or shorter than that required in the U.S. Clinical
studies conducted outside of any particular country may not be accepted by that
country, and the approval of a pharmaceutical product in one country does not
assure that the product will be approved in another country. In addition,
regulatory agency approval of pricing is required in many countries and may be
required for our marketing of any drug in those countries.

WE ARE VULNERABLE TO PRESSURES FROM THIRD-PARTY PAYERS.

Our commercial success in product sales will depend on patients being reimbursed
by third-party health care payers, such as government and private health
insurers and managed care organizations. Third-party payers are increasingly
challenging the pricing of medical products and services. For example,
third-party payers strenuously discourage use of branded products such as ours
when generic substitutes are available. As a result, reimbursement may not be
available to enable us to maintain price levels sufficient to realize an
appropriate return on our investment in product acquisition and development. If
adequate reimbursement levels are not provided, our business, financial
condition and results of operations could be materially and adversely affected.

The market for our products may be limited by actions of third-party payers. For
example, many managed health care organizations are now limiting the
pharmaceutical products that are on their lists of approved drugs. The resulting
competition among pharmaceutical companies to place their products on these
formulary lists has created a trend of downward pricing pressure in the
industry. In addition, many managed care organizations are pursuing various ways
to reduce pharmaceutical costs and are considering formulary contracts primarily
with those pharmaceutical companies that can offer a broad line of products for
a given class of therapy or disease, which we cannot do. Our products may not be
included on the approved drug list of managed care organizations, and downward
pricing pressures in the industry generally could materially and adversely
impact our business, financial condition and results of operations.

Additionally, a number of legislative proposals aimed at reducing the costs of
medical products and services have been enacted or proposed. For example,
certain state governments have enacted legislation that seeks to reduce the
price paid by the Medicaid program for prescription drugs. In Florida and
Michigan, pharmaceutical companies that sell drugs reimbursed under state
Medicaid programs are now required to offer rebates in addition to the existing
rebates mandated by Federal law in order for their prescription drugs to be
placed on the state's preferred list of drugs eligible for Medicaid
reimbursement. A number of states are considering additional legislation and
other measures that would, if enacted, further adversely affect revenues from
the sale of branded drugs, for example, through limits on the purchase of
branded drugs by state institutions and restrictions on reimbursement for
branded drugs in programs subject to state jurisdiction. Additionally, several
large pharmaceutical companies have recently adopted discount plans for the
elderly. Our business, financial condition and results of operations could be
materially and adversely affected if recently established or future legislative
or regulatory programs that are designed to reduce the costs of medical products
and services are effective or require consumers to use generic substitutes for
our branded products.



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PRODUCT LIABILITY CLAIMS OR PRODUCT RECALLS COULD HARM OUR BUSINESS, FINANCIAL
CONDITION AND RESULTS OF OPERATIONS.

We face an inherent business risk of exposure to product liability claims in the
event that the use of our products is alleged to have resulted in adverse
effects. Such risks will exist even with respect to those products that receive
regulatory approval for commercial sale. While we take what we believe are
appropriate precautions, we may not be able to avoid significant product
liability exposure. We currently have product liability insurance in the amount
of $10 million for aggregate annual claims. This insurance is subject to
significant limitations, including a $100,000 deductible per incident, among
other things. This level of insurance coverage, however, may not be sufficient
to cover all potential claims against us or involving our products. Also,
adequate insurance coverage may not be available in the future at acceptable
costs, if at all. When we acquire or develop new products, we cannot assure you
that additional liability insurance coverage for these new products will be
available on acceptable terms, if at all. Although we have yet to face a product
liability claim, the assertion of this type of claim could have a material
adverse affect on our business, financial condition and results of operations.

Product recalls may be issued at our discretion or at the discretion of the FDA,
other government agencies or others having regulatory authority for
pharmaceutical product sales. For example, we initiated a recall of one batch of
M.V.I.-Pediatric manufactured in April 2001, even though we do not believe that
we are legally responsible because we did not own the product when this batch
was manufactured. We believe that none of the recalled product remains in the
market. Any product recall could materially adversely affect our business,
financial condition and results of operations.

WE DEPEND ON KEY PERSONNEL.

We are highly dependent on key personnel, and the loss of any of them,
particularly Frederick D. Sancilio, Ph.D., our Executive Chairman and Chief
Scientific Officer, and Philip S. Tabbiner, our President and Chief Executive
Officer, would be disruptive and could materially and adversely affect our
business and prospects for success. Although we believe that we are adequately
staffed in key positions and that we will be successful in retaining skilled and
experienced management, operational and scientific personnel, we cannot assure
you that we will be able to attract and retain such personnel on acceptable
terms. The loss of the services of key scientific, technical and management
personnel could have a material adverse effect on us, especially in light of our
recent growth. We do not maintain key-person life insurance on, or have any
employment agreements with, any of our executives other than Dr. Sancilio.

CONSOLIDATION OF OUR DISTRIBUTION NETWORK FOR PHARMACEUTICAL PRODUCTS COULD
RESULT IN REDUCED PRODUCT PURCHASES AND INCREASED PRODUCT RETURNS BY OUR
CUSTOMERS.

The distribution network for pharmaceutical products has in recent years been
subject to increasing consolidation. As a result, a few large wholesale
distributors control a significant share of the market. These large,
well-established distributors are our Pharmaceuticals Division's primary
customers. We anticipate that as our Pharmaceutical Division's business expands,
some of these wholesalers and distributors may become significant customers
accounting for 10% or more of our consolidated net revenues. This consolidation
trend could cause our distributors to stop carrying or reduce their inventory
levels of our products, return our products or reduce our product offerings. For
example, many pharmacies do not carry Darvon and Darvocet, instead carrying only
generic substitutes. Additionally, there could be negative developments with any
of these distributors or any of them could have financial difficulties. Any of
these factors could have a material adverse effect on our business, financial
condition and results of operations.



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             RISKS RELATED TO OUR STOCK PRICE AND CORPORATE CONTROL

OUR EXECUTIVE OFFICERS AND DIRECTORS AND ENTITIES AFFILIATED WITH THEM, WHOSE
INTERESTS MAY DIFFER FROM OTHER STOCKHOLDERS, WILL HAVE THE ABILITY TO EXERCISE
SIGNIFICANT CONTROL OVER US.

As of January 31, 2003, our executive officers, directors and entities
affiliated with them, as a group, beneficially own approximately 47.5% of our
common stock. Dr. Sancilio individually owns approximately 22.2% of our common
stock. These stockholders, particularly Dr. Sancilio, will be able to exercise
significant influence over all matters requiring approval by our stockholders,
including the election of directors and the approval of significant corporate
transactions, including a change of control of our company. The interests of
these stockholders may differ from the interests of our other stockholders.

OUR STOCK PRICE MAY BE VOLATILE AND MAY DECLINE.

Our stock price has been volatile in the past, due, in part, to low trading
volume and the small percentage of our outstanding common stock held by public
investors. From January 1, 2000 through March 1, 2003, our stock price has
ranged from a low trading price of $4.21 per share to a high trading price of
$26.66 per share. The market price of our common stock may also be affected by
our ability to meet analysts' and investors' expectations. Failure to meet these
expectations, even slightly, could cause the market price of our common stock to
fall significantly.

FUTURE SALES OF COMMON STOCK BY OUR PRINCIPAL STOCKHOLDERS MAY CAUSE OUR STOCK
PRICE TO DECLINE.

At March 21, 2003, after our three-for-two stock dividend, we had 27,612,539
shares of common stock outstanding, and our executive officers, directors and
entities affiliated with them, as a group own 12,976,947 of these shares. We
cannot predict when any of these stockholders may sell their shares or in what
volumes. However, the market price of our common stock could decline
significantly if these stockholders sell a large number of shares into the
public market or if the market believes that these sales may occur.

IT MAY BE DIFFICULT FOR A THIRD PARTY TO ACQUIRE OUR COMPANY, WHICH COULD
DEPRESS OUR STOCK PRICE.

Delaware corporate law and our certificate of incorporation and bylaws contain
provisions that could deter or prevent a change in control of our company or our
management that stockholders may consider favorable or beneficial. These
provisions could discourage proxy contests and make it more difficult for you
and other stockholders to elect directors and take other corporate actions.
These provisions could also limit the price that investors might be willing to
pay in the future for shares of our common stock. These provisions, which may be
amended only upon recommendation by our board of directors and approval by our
stockholders include:

         o        a staggered board of directors, so that it would take three
                  successive annual meetings to replace all directors;

         o        authorization of special meetings of stockholders only upon a
                  call by the board of directors;

         o        authorization to issue "blank check" preferred stock, which is
                  preferred stock that can be created and issued by the board of
                  directors without prior stockholder approval, with rights
                  senior to our common stockholders;

         o        prohibition on stockholder action by written consent; and

         o        advance notice requirements for the submission by stockholders
                  of nominations for election to the board of directors and for
                  proposing matters that can be acted upon by stockholders at a
                  meeting.

In addition, our senior credit facilities and senior subordinated notes could
deter a change of control that our stockholders consider favorable or
beneficial. A change of control of our company constitutes an event of



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default under our senior credit facilities, and upon a change of control, we are
required to offer to repay all of our outstanding senior subordinated notes. Our
senior credit facilities, however, prevent us from repaying any of these notes
prior to repaying all obligations under our senior credit facilities. As of
December 31, 2002, we had approximately $271.4 million outstanding under these
debt agreements.

                      RISKS RELATING TO OUR CAPITALIZATION

OUR SUBSTANTIAL DEBT COULD ADVERSELY AFFECT OUR CASH FLOW AND PREVENT US FROM
FULFILLING OUR OBLIGATIONS.

We have a significant amount of debt. Our substantial amount of debt could have
important consequences to you.

For example, it:

         o        will make it more difficult for us to satisfy our obligations
                  under our senior credit facilities and senior subordinated
                  notes;

         o        will increase our vulnerability to general adverse economic
                  and industry conditions and adverse changes in governmental
                  regulations;

         o        will require us to dedicate a substantial portion of our cash
                  flow from operations to make payments on our debt, reducing
                  the availability of our cash flow to fund future capital
                  expenditures, working capital, execution of our growth
                  strategy, research and development costs and other general
                  corporate requirements;

         o        could limit our flexibility in planning for, or reacting to,
                  changes in our business and the pharmaceutical industry, which
                  may place us at a competitive disadvantage compared with
                  competitors that have less debt; and

         o        could limit our ability to borrow additional funds, even when
                  necessary to maintain adequate liquidity.

The terms of our senior credit facilities and senior subordinated notes allow us
to incur substantial amounts of additional debt, subject to certain limitations.
We might incur additional debt for various reasons, particularly to pay for the
additional product line acquisitions that we may make for our Pharmaceuticals
Division business unit.

TO SERVICE OUR DEBT, WE WILL REQUIRE A SIGNIFICANT AMOUNT OF CASH, WHICH MAY NOT
BE AVAILABLE TO US.

Our ability to make payments on or refinance our debt will depend largely upon
our future operating performance. Our future operating performance is subject to
general economic, financial, competitive, legislative, regulatory and other
factors that are beyond our control.

We cannot assure you that our business will generate cash flow from operations
in an amount sufficient to enable us to pay our debt or to fund our other
liquidity needs. For example, in 1999 we had a loss from operations of $8.8
million and net cash used in operating activities of $12.7 million. If we are
unable to generate sufficient cash flow to meet our debt service requirements,
we may have to renegotiate the terms of our debt. We cannot assure you that we
will be able to repay or refinance any of our debt, including our senior credit
facilities or senior subordinated notes, on commercially reasonable terms or at
all.



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<PAGE>

If we were unable to refinance our debt or obtain new financing under these
circumstances, we would have to consider other options, such as:

         o        sales of certain assets to meet our debt service obligations;

         o        sales of equity; and

         o        negotiations with our lenders to restructure the applicable
                  debt.

However, these options may not be feasible or prove adequate. Our credit
agreement and the indenture may restrict, or market or business conditions may
limit, our ability to do some of these things.

THE FINANCING AGREEMENTS GOVERNING OUR DEBT, INCLUDING OUR SENIOR CREDIT
FACILITIES AND SENIOR SUBORDINATED NOTES, CONTAIN VARIOUS COVENANTS THAT LIMIT
OUR DISCRETION IN THE OPERATION OF OUR BUSINESS AND COULD LEAD TO ACCELERATION
OF DEBT.

Our existing financing agreements impose operating and financial restrictions on
our activities. These restrictions require us to comply with or maintain certain
financial tests and ratios, and limit or prohibit our ability to, among other
things:

         o        incur additional debt and issue preferred stock;

         o        create liens on our assets;

         o        redeem and/or prepay certain debt;

         o        sell capital stock of subsidiaries or other assets;

         o        make certain investments;

         o        enter new lines of business;

         o        engage in consolidations, mergers and acquisitions;

         o        make certain capital expenditures; and

         o        pay dividends and make other distributions.

These restrictions on our ability to operate our business could seriously harm
our business by, among other things, limiting our ability to take advantage of
financing, merger and acquisition and other corporate opportunities.

Various risks, uncertainties and events beyond our control could affect our
ability to comply with these covenants and maintain the financial tests and
ratios required by some of the instruments governing our financing arrangements.
Failure to comply with any of the covenants or financial tests or ratio in our
financing agreements could result in a default under those agreements and under
other agreements containing cross-default provisions. A default would permit
lenders to accelerate the maturity of the debt under these agreements and to
foreclose upon any collateral securing that debt. Under these circumstances, we
might not have sufficient funds or other resources to satisfy all of our
obligations, including our obligations under our senior credit facilities and
senior subordinated notes. In addition, the limitations imposed by these
financing agreements on our ability to incur additional debt and to take other
actions might significantly impair our ability to obtain other financing. We may
not be able to obtain future waivers or amendments, if necessary.


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