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UNITED STATES
    SECURITIES AND EXCHANGE COMMISSIONWashington, D.C.
    20549
      Form 10-K
  (Mark One)þ

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended
    December 31,
    2009ORo

TRANSITION REPORT PURSUANT TO
    SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
    1934For the transition period
    from          to   Commission file number:
    000-50767
      CORNERSTONE THERAPEUTICS
    INC.
 (Exact Name of Registrant as
    Specified in Its Charter)
  Delaware

04-3523569(State or Other Jurisdiction of

(IRS EmployerIncorporation or
    Organization)

Identification No.)1255 Crescent Green Drive, Suite 250

27518Cary, North Carolina

(Zip Code)(Address of Principal Executive
    Offices)    (919) 678-6611
        Title of Each Class

Name of Each Exchange on Which RegisteredCommon Stock, $0.001 par value per share

The NASDAQ Stock Market LLC          o þ
  o þ
  þ o
  Regulation S-T o o
  Regulation S-K Form 10-K Form 10-K. þ
  Rule 12b-2
  Large
    accelerated
    filer o
    Accelerated
    filer þ
    Non-accelerated
    filer o
    Smaller reporting
    company þ (Do not check if a smaller
    reporting company)
   Rule 12b-2 o þ
      DOCUMENTS
    INCORPORATED BY REFERENCE




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##### 





CORNERSTONE
    THERAPEUTICS INC.
    ANNUAL REPORT
    ON
    FORM 10-K
    INDEX
   
 PagePART IItem 1.


Business

1Item 1A.


Risk Factors

34Item 1B.


Unresolved Staff Comments

60Item 2.


Properties

60Item 3.


Legal Proceedings

60Item 4.


(Removed and Reserved)

62EXECUTIVE OFFICERS OF THE REGISTRANT

63PART IIItem 5.


Market for Registrants Common Equity,
    Related Stockholder Matters and Issuer Purchases of Equity
    Securities

65Item 6.


Selected Financial Data

65Item 7.


Managements Discussion and Analysis of
    Financial Condition and Results of Operations

66Item 7A.


Quantitative and Qualitative Disclosures About
    Market Risk

86Item 8.


Financial Statements and Supplementary Data

87Item 9.


Changes in and Disagreements With Accountants on
    Accounting and Financial Disclosure

121Item 9A.


Controls and Procedures

121Item 9A(T).


Controls and Procedures

123Item 9B.


Other Information

123PART IIIItem 10.


Directors, Executive Officers and Corporate
    Governance

124Item 11.


Executive Compensation

124Item 12.


Security Ownership of Certain Beneficial Owners
    and Management and Related Stockholder Matters

125Item 13.


Certain Relationships and Related Transactions,
    and Director Independence

125Item 14.


Principal Accountant Fees and Services

125PART IVItem 15.


Exhibits, Financial Statement Schedules

125SIGNATURES

126EXHIBIT INDEXEX-10.32 Amendment No. 1, dated December 18, 2009, to Supply and Marketing AgreementEX-10.75 Form of Restricted Stock Agreement granted under 2004 Stock Incentive PlanEX-10.89 Separation Letter Agreement and General Release between the Registrant and Brian Dickson dated October 16, 2009EX-10.96 Executive Employment Agreement between the Registrant and Andrew K. W. Powell dated October 30, 2009EX-21.1 Subsidiaries of the RegistrantEX-23.1 Consent of Grant Thornton LLPEX-31.1 Section 302 Certification of the Principal Executive OfficerEX-31.2 Section 302 Certification of the Principal Financial OfficerEX-32.1 Section 906 Certification of the Principal Executive OfficerEX-32.2 Section 906 Certification of the Principal Financial Officer




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PART I  Cautionary
    Statement Regarding Forward-Looking Statements
  Form 10-K Form 10-K Form 10-K
  ITEM 1.
    BUSINESS  Background
   1




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® ®
  ®
  ®
  Overview
    
    promotes products that address acute respiratory ailments to
    high prescribing respiratory physicians and key retail
    pharmacies through our respiratory sales force;
    promotes a respiratory product prescribed in hospitals to
    hospital-based healthcare professionals through our hospital
    sales force; and
    launches branded, unbranded and authorized generic versions of
    products (including our own products) through our wholly owned
    subsidiary Aristos Pharmaceuticals, Inc., or Aristos.  and/or
     2




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##### Table of Contents




    CUROSURF, an FDA-approved natural lung surfactant for the
    treatment of Respiratory Distress Syndrome, or RDS, in premature
    infants, for which we acquired rights in the United States in
    August 2009;
    FACTIVE, a fluoroquinolone with a broad and powerful activity
    against certain microorganisms implicated in certain respiratory
    infections, including multi-drug resistant strains of
    Streptococcus pneumoniae, or MDRSP, for which we acquired
    rights in North America and certain European countries in
    September 2009;
    SPECTRACEF®

    (cefditoren pivoxil) tablets, a third-generation cephalosporin
    indicated for the treatment of certain respiratory and skin
    infections, for which we acquired rights in the United States in
    October 2006;
    ZYFLO CR, the only FDA-approved leukotriene synthesis inhibitor
    indicated for prophylaxis and chronic treatment of asthma, for
    which we acquired worldwide rights in December 2003 and March
    2004; and
    Our other products, of which the most significant are
    ALLERX®

    (combinations of methscopolamine nitrate, pseudoephedrine
    hydrochloride, phenylephrine hydrochloride and chlorpheniramine
    maleate) tablets and
    HYOMAX®

    (hyoscyamine sulfate) tablets. Our ALLERX Dose Pack products
    consist of various oral tablet dose packs prescribed for the
    treatment of symptoms of allergic rhinitis, for which we
    acquired U.S. rights to the current patent covering this
    product line in August 2006. Our HYOMAX family of products
    includes five antispasmodic medications containing an
    anticholinergic, which may be prescribed for functional
    intestinal disorders to reduce symptoms such as those seen in
    mild dysenteries, diverticulitis and irritable bowel syndrome,
    or IBS, for which we acquired the rights in May 2008.     3




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
    Remaining profitable and leveraging our established business to
    continue to generate cash;
    Growing our lead products;
    Acquiring additional products that complement our lead products;
    Aggressively advancing our development initiatives; and
    Identifying partners to maximize the value of our non-strategic
    assets.  Our
    Promoted Products
    CUROSURF
  Overview.
    Market Opportunity.
  Benefits of CUROSURF.
  ® 2
  2 2
   4




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Proprietary Rights.
  FACTIVE
  Overview. five-day seven-day Streptococcus pneumoniae Haemophilus influenzae, Moraxella catarrhalis,
    Mycoplasma pneumoniae, Chlamydia pneumoniae Klebsiella pneumoniae five-day
  Market Opportunity.
    Benefits of FACTIVE.
  Streptococcus pneumoniae five-day Streptococcus pneumoniae Haemophilus influenzae Chlamydia
    pneumoniae Mycoplasma
    pneumoniae five-day five-day
  Proprietary Rights.
 5




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SPECTRACEF
  Overview.
  10-day 14-day
  Market Opportunity.
    Benefits of SPECTRACEF. Streptococcus pneumoniae Haemophilus
    influenzae Moraxella catarrhalis Streptococcus
    pneumoniae Haemophilus influenzae Moraxella
    catarrhalis
  Proprietary Rights.
  ZYFLO
    CR
  Overview.
 6




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Market Opportunity.
  Benefits of ZYFLO CR.
    
    rapid and sustained improvement for patients over a six-month
    period in objective and subjective measures of asthma control;
    reduction of exacerbations and need for either bronchodilatory
    or steroid rescue medications; and
    acute bronchodilatory effect within two hours after the first
    dose.       7




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Proprietary Rights.
  Other
    Products
  Form 10-K Form 10-K.
  ALLERX
    DOSE PACKS
  Overview.
  Market Opportunity.
    Benefits of ALLERX Dose Packs.
  Proprietary Rights. , Form 10-K.
   8




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HYOMAX
  Overview.
  Market Opportunity.
    Benefits of HYOMAX. ® benefit-to-risk
  Proprietary Rights.
  Product
    Development Pipeline
  Overview.
  Therapeutic Class

Regulatory StatusCough/ColdProduct Candidate SubmittedCRTX 067

Regulatory application submitted in July 2009Other Product CandidatesCRTX 069

Submission targeted in 2011CRTX 072

Submission targeted in 2011CRTX 074

Submission targeted in 2011AllergyCRTX 058

Submission timeline under review by managementCRTX 070

Submission targeted in 2012Anti-AsthmaCRTX 073

Submission targeted in 2011Anti-InfectiveCRTX 062

Submission timeline under review by managementCRTX 068

Submission timeline under review by management    9




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Cough/Cold
    Product Candidates  CRTX 067, CRTX 069, CRTX 072 and
    CRTX 074
  Overview and Development Status.
  Market Opportunity.
  Benefits of CRTX 067, CRTX 069, CRTX 072 and CRTX
    074.
  Proprietary Rights. ® ® 12-hour
  Allergy
    Product Candidates  CRTX 058 and CRTX
    070
  Overview and Development Status.
  Market Opportunity.
    Benefits of CRTX 058 and CRTX 070.
 10




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and/or
  Proprietary Rights. ®
  Anti-Asthma
    Product Candidate  CRTX 073
  Overview.
  Proprietary Rights.
  Anti-Infective
    Product Candidates  CRTX 062 and CRTX
    068
  Overview.
  Proprietary Rights.
  Other
    Technology Assets
    
    the development of a small molecule product candidate targeting
    the alpha-7 receptor;
    the development, in collaboration with MedImmune, Inc., or
    MedImmune, a subsidiary of AstraZeneca PLC, of monoclonal
    antibodies directed toward a cytokine called HMGB1, which we
    believe may be an important target for the development of
    products to treat diseases mediated by the bodys
    inflammatory response; 11




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
    the development of an injectable form of zileuton initially for
    use in emergency room or urgent care centers for patients who
    suffer acute exacerbations of asthma; and
    the examination of the pharmacokinetic and pharmacodynamic
    profile of the R(+) isomer of zileuton to determine if there are
    potential dosing improvements for patients from this isomer.  Alpha-7
    Program
      HMGB1
    Program
        Zileuton
    Injection
     12




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##### Table of Contents



R(+)
    Isomer of Zileuton
    Sales and
    Marketing; Co-promotion Agreements
  Sales
    and Marketing
            Co-promotion
    Agreements
    DEY  Co-Promotion and Marketing Services Agreement
    for ZYFLO CR.
 13




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Trade,
    Distribution and Reimbursement
  Trade
    Sales and Distribution
    Customer

2009

2008Cardinal Health


34
%


40
%McKesson Corporation


34
%


31
%AmerisourceBergen Corporation


20
%


15
%      14




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Reimbursement
    Manufacturing
     15




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Product

Manufacturer/PackagerCUROSURF

ChiesiFACTIVE 5 and 7API (gemifloxacin mesylate)

LGLSFACTIVE tablets

PatheonFACTIVE packaging

Catalent Pharma Solutions, Inc.SPECTRACEFAPI (cefditoren pivoxil), tablets and packaging

Tedec-MeijiZYFLO/ZYFLO CRAPI (zileuton)

Shasun Pharma Solutions Ltd.ZYFLO tablets

PatheonZYFLO CR tablet cores

Jagotec AGZYFLO CR tablet coating and packaging

PatheonALLERXALLERX tablets

Sovereign Pharmaceuticals, Ltd.ALLERX packaging

Pharma Packaging SolutionsHYOMAXHYOMAX tablets and packaging

Sovereign Pharmaceuticals, Ltd.       Chiesi 
    License and Distribution Agreement
  Form 10-K.
  LGLS 
    License and Option Agreement
  Form 10-K.
  Meiji 
    SPECTRACEF License and Supply Agreement
  Form 10-K.
  Shasun 
    Agreement for Manufacturing and Supply of Zileuton
    API
   16




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18-months
  Jagotec 
    Manufacture and Supply Agreement for ZYFLO CR
  12-month 24-months 36-months
  Patheon Manufacturing
    Services Agreement for ZYFLO CR
  12-months 18-months
  Patheon Commercial
    Manufacturing Agreement for ZYFLO Immediate-Release
    Tablets
  12-months 18-months
  Sovereign Manufacturing
    of HYOMAX Product Line
  Form 10-K.
  Intellectual
    Property
    Patents
       17




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Patents
  Number

Issued Patents

Product(s)

ExpirationLicensed Patents4,873,259

Indole, Benzofuran, Benzothiophene Containing Lipoxygenase
    Inhibiting Compounds

ZYFLO CR and ZYFLO

12/10/20105,422,123

Tablets with controlled-rate release of active substances

ZYFLO CR

06/06/20125,633,262

Quinoline carboxylic acid derivatives having
    7-(4-amino-methyl-3-oxime)
    pyrrolidine substituent and processes for preparing thereof

FACTIVE

06/15/20155,962,468

7-(4-aminomethyl-3-methyloxyiminopyrroplidin-1-yl)-1-cyclopropyl-6-flu
    oro-4-oxo-1,4-dihydro-1,8-naphthyridine-3-carboxylic acid and
    the process for the preparation thereof

FACTIVE

06/15/20155,958,915

Antibacterial composition for oral administration

SPECTRACEF

10/14/20165,776,944

7-(4-aminomethyl-3-methyloxyiminopyrroplidin-1-yl)-1-cyclopropyl-6-flu
    oro-4-oxo-1,4-dihydro-1,8-naphthyridine-3-carboxylic acid and
    the process for the preparation thereof

FACTIVE

04/04/20176,723,734

Salt of naphthyridine carboxylic acid derivative

FACTIVE

03/20/20186,340,689

Methods of use of quinolone compounds against atypical upper
    respiratory pathogenic bacteria

FACTIVE

09/14/20196,262,071

Methods of use of antimicrobial compounds against pathogenic
    amycoplasma bacteria

FACTIVE

09/21/20196,331,550

Methods of use of quinolone compounds against anaerobic
    pathogenic bacteria

FACTIVE

09/21/20196,455,540

Methods of use of quinolone compounds against anaerobic
    pathogenic bacteria

FACTIVE

09/21/20196,803,376

Method of use of quinolone compounds against pneumococcal and
    haemophilus bacteria

FACTIVE

09/21/20196,843,372

Antihistamine/decongestant regimens for treating rhinitis

ALLERX Dose Pack PE, 
    ALLERX 10 Dose Pack, 
    ALLERX 30 Dose Pack

05/04/2021  18




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Patent
    Applications
   Number

Pending Patents

Product

Expiration20080015241

All day rhinitic condition treatment regimen

ALLERX Dose Pack DF

07/13/202620080311196

All day rhinitic condition treatment regimen

ALLERX Dose Pack DF

07/13/2026           Trade
    Secrets
    Trademarks
   19




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License
    and Collaboration Agreements
    Chiesi 
    CUROSURF License and Distribution Agreement
  Overview. 10-year
  Fees, Milestones and Royalties.
  Exclusive Supplier.
  Term and Termination. 10-year
  LG
    Life Sciences  FACTIVE License and Option
    Agreement
  Overview.
  Fees, Milestones and Royalties.
  Exclusive Supplier.
  Term and Termination.
  Meiji 
    SPECTRACEF License and Supply Agreement
  Overview.
 20




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Fees, Milestones and Royalties.
  Exclusive Supplier and Minimum Purchase
    Obligation.
  Term and Termination. product-by-product product-by-product 270-days
  Joint Product Development.
  Abbott 
    Zileuton License Agreements
  Overview. ®
 21




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Fees and Royalty Payments. country-by-country
  Term and Termination. 60-days
  Jagotec 
    Consent to Abbott Sublicense of Zileuton
    Pharmaceutical
    Innovations  ALLERX 372 Patent License
    Agreement
  Overview. Form 10-K.
  Royalties.
 22




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Term and Termination.
  Neos 
    Development, License and Services Agreement 
    Anticholinergic and Antihistamine Combination
    Product
  Overview.
  Fees, Milestones and Royalties.
  Term and Termination. 90-days
  Neos
    and Coating Place  Development and Manufacturing
    Agreement  Antitussive and Antihistamine Combination
    Product
  Overview.
  Fees, Milestones and Profit Sharing.
  Product Development, Regulatory and Commercialization
    Expenses.
 23




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Exclusivity.
  Term and Termination.
  Neos 
    Products Development Agreement
  Overview.
  Fees, Milestones and Royalties.
  Term and Termination.
  Sovereign 
    Supply and Marketing Agreement for Sovereigns Hyoscyamine
    Products
   24




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The
    Feinstein Institute  HMGB1 License Agreement and
    Alpha-7 License Agreement
  Overview.
  Fees and Royalty Payments Under License
    Agreement.
  Related Sponsored Research Agreements.
  Fees and Royalty Payments Under Sponsored Research
    Agreements.
  MedImmune 
    License and Collaboration Agreement  HMGB1
    Pharmaceuticals
  Overview.
   25




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##### Table of Contents



Milestones and Royalties. product-by-product country-by-country
  Term and Termination.
  Beckman
    Coulter  License Agreement  HMGB1
    Diagnostic Products
  Overview.
  Milestones and Royalties.
  Term and Termination. 90-days
  SetPoint 
    Vagus Nerve Technology License
  Overview.
  
    amounts payable to The Feinstein Institute in connection with
    the filing of any U.S. patent application or issuance of a
    U.S. patent relating to the field of cholinergic
    anti-inflammatory technology; and 26




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
    minimum annual royalties payable to The Feinstein Institute
    beginning in the first year after termination of research
    activities under the sponsored research agreement.  Milestones and Royalties.
  Term and Termination. 90-days
  Competition
          
    CUROSURF Abbotts Survanta and ONY,
    Inc.s
    Infasurf®.
    FACTIVE or any anti-infective product candidate Ortho-McNeil-Janssen Pharmaceuticals,
    Inc.s
    Levaquin®

    (levofloxacin), Bayer Corporations
    Avelox®

    (moxifloxacin) and generic formulations of Bayer Schering
    AGs
    Cipro®

    (ciprofloxacin).
    SPECTRACEF Dose Packs or any anti-infective product candidate second and third generation cephalosporins, such
    as Shionogi USA, Inc.s
    Cedax®

    (ceftibuten), Lupin Pharmaceuticals, Inc.s,
    Suprax®

    and generic formulations of Abbotts
    Omnicef®

    (cefdinir) and GlaxoSmithKline plcs, or GSK,
    Ceftin®

    (cefuroxime).
    ZYFLO CR and ZYFLO or anti-asthma product
    candidate bronchodilatory drugs, such as Teva
    Specialty Pharmaceuticals LLCs
    ProAir®

    HFA (albuterol sulfate) Inhalation Aerosol and Schering-Plough
    Corporations, or Schering Plough,
    Proventil®

    HFA (albuterol sulfate) Inhalation Aerosol; 27




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LTRAs, such as Merck Sharp and Dohmes
    Singulair®

    (montelukast sodium); inhaled corticosteroids, such as
    GSKs
    Flovent®

    Diskus®

    (fluticasone propionate inhalation powder); and combination
    products, such as GSKs Advair
    Diskus®

    (fluticasone propionate and salmeterol inhalation powder) and
    AstraZeneca LPs
    Symbicort®

    (budesonide/formoterol fumarate dehydrate) Inhalation Solution.
    In addition, we may face competition from pharmaceutical
    companies seeking to develop new drugs for the asthma market.  
    ALLERX Dose Pack Products or any allergy product candidate prescription products, including first
    generation antihistamine and antihistamine combination products,
    such as Capellon Pharmaceuticals, Ltd.s
    Rescon®

    (phenylephrine, chlorpheniramine and methscopolamine) and Laser
    Pharmaceuticals, LLCs
    Dallergy®

    (phenylephrine, chlorpheniramine and methscopolamine);
    over-the-counter
    products, such as McNeil-PPC, Inc.s, or McNeil-PPC,
    Benadryl®

    (diphenhydramine), Schering-Ploughs
    Chlor-Trimeton®

    (chlorpheniramine) and
    Claritin®

    (loratadine), McNeil-PPCs
    Zyrtec®

    (cetirizine); second generation antihistamines, such as
    Sanofi-Aventis U.S. LLCs, or Sanofi Aventis,
    Allegra®

    (fexofenadine); and third generation antihistamine branded
    families of products, such as UCB, Inc. and
    Sanofi-Aventiss
    Xyzal®

    (levocetirizine) and Schering-Ploughs
    Clarinex®

    (desloratadine).
    HYOMAX Products belladonna and derivative
    antispasmodics, such as the generic formulations of Alaven
    Pharmaceutical LLCs
    Levsin®

    (hyoscyamine sulfate) and
    Levbid®

    (hyoscyamine sulfate) and of PBM Pharmaceuticals, Inc.s
    Donnatal®

    (belladonna alkaloids/phenobarbital); IBS selective serotonin
    5-HT3 antagonists, such as
    Lotronex®;

    urinary incontinence antispasmodics, such as Pfizer Inc.s
    Detrol®

    LA (tolterodine tartrate), Astellas Pharmaceuticals, Inc. and
    GSKs
    VESIcare®

    (solifenacin) and the generic formulations of
    Ortho-McNeil-Janssen Pharmaceuticals, Inc.s
    Ditropan®

    and Ditropan
    XL®

    (oxybutynin); and synthetic gastrointestinal antispasmodics,
    such as the generic formulations of Axcan Pharma Inc.s
    Bentyl®

    (dicyclomine) and Bradley Pharmaceuticals, Inc.s
    Pamine®

    (methscopolamine bromide).
    Cough/cold product candidates various
    narcotic and non-narcotic antitussives, such as King
    Pharmaceuticals, Inc.s
    Tussigon®

    (hydrocodone and homatropine), Mallinckrodt Brand
    Pharmaceuticals, Inc.s
    TussiCaps®

    (hydrocodone polistirex and chlorpheniramine polistirex), UCB,
    Inc.s
    Tussionex®

    (hydrocodone polistirex and chlorpheniramine polistirex) and
    generic formulations of promethazine hydrochloride and codeine
    phosphate oral syrup and Forest Laboratories, Inc.s
    Tessalon® (benzonatate);
    over-the-counter
    antitussives, such as Reckitt Benckiser Inc.s
    Delsym®

    (dextromethorphan polistirex), Schering-Ploughs Coricidin
    HBP®

    Cough & Cold (dextromethorphan and chlorpheniramine).  Regulatory
    Matters
  and/or
  FDA
    Regulation of Drug Products
   28




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New Drug Applications.
  
    pre-clinical laboratory tests, animal studies and formulation
    studies;
    submission to the FDA of an investigational new drug
    application, or IND, for human clinical testing, which must
    become effective before human clinical trials may begin;
    adequate and well-controlled clinical trials to establish the
    safety and efficacy of the drug for each indication;
    submission to the FDA of an NDA;
    satisfactory completion of an the FDA inspection of the
    manufacturing facility or facilities at which the drug is
    produced to assess compliance with cGMP; and
    FDA review and approval of the NDA.         29




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Supplemental New Drug Applications.
      Abbreviated New Drug Applications.
  and/or
  Section 505(b)(2) New Drug
    Applications.
   30




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##### Table of Contents



and/or
  Foreign
    Regulation
    Regulation
    of Controlled Substances
       31




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##### Table of Contents



Hazardous
    Materials
    Pharmaceutical
    Pricing and Reimbursement
        
    controls on government funded reimbursement for drugs;
    controls on payments to health care providers that affect demand
    for drug products;
    challenges to the pricing of drugs or limits or prohibitions on
    reimbursement for specific products through other means;
    weakening of restrictions on imports of drugs; and
    expansion of the use of managed care systems in which health
    care providers contract to provide comprehensive health care for
    a fixed cost per person.     32




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Fraud and
    Abuse Regulation
    
    Federal Anti-Kickback Law.  The anti-kickback
    law contained in the federal Social Security Act is a criminal
    statute that makes it a felony for individuals or entities
    knowingly and willfully to offer or pay, or to solicit or
    receive, direct or indirect remuneration, in order to induce the
    purchase, order, lease, or recommending of items or services, or
    the referral of patients for services, that are reimbursed under
    a federal health care program, including Medicare and Medicaid.
    The term remuneration has been interpreted broadly
    and includes both direct and indirect compensation and other
    items and services of value. Both the party offering or paying
    remuneration and the recipient may be found to have violated the
    statute. Courts have interpreted the anti-kickback law to cover
    any arrangement where one purpose of the remuneration is to
    induce purchases or referrals, regardless of whether there are
    also legitimate purposes for the arrangement. There are narrow
    exemptions and regulatory safe harbors, but many legitimate
    transactions fall outside of the scope of any exemption or safe
    harbor, although that does not necessarily mean the arrangement
    will be subject to penalties under the anti-kickback statute.
    Penalties for federal anti-kickback violations are severe,
    including up to five years imprisonment, individual and
    corporate criminal fines, exclusion from participation in
    federal health care programs and civil monetary penalties in the
    form of treble damages plus $50,000 for each violation of the
    statute.
    State Laws.  Various states have enacted laws
    and regulations comparable to the federal fraud and abuse laws
    and regulations. These state laws and regulations may apply to
    items or services reimbursed by any third-party payor, including
    private, commercial insurers and other payors. Moreover, these
    laws and regulations vary significantly from state to state and,
    in some cases, are broader than the federal laws and
    regulations. These differences increase the costs of compliance
    and the risk that the same arrangements may be subject to
    different compliance standards in different states.  Employees
   33




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##### Table of Contents



Available
    Information
  Form 10-K, Form 10-Q, Form 8-K
  ITEM 1A.
    RISK
    FACTORS  Form 10-K
  Risks
    Relating to Commercialization and Product Acquisitions
  The
    commercial success of our currently marketed products and any
    additional products that we successfully develop or bring to
    market depends on the degree of market acceptance by physicians,
    patients, health care payors and others in the medical
    community.
    
    the prevalence and severity of the products side effects;
    the efficacy and potential advantages of the products over
    alternative treatments;
    the ability to offer the products for sale at competitive
    prices, including in relation to any generic or re-imported
    products or competing treatments;
    the relative convenience and ease of administration of the
    products;
    the willingness of the target patient population to try new
    therapies and of physicians to prescribe these therapies;
    the perception by physicians and other members of the health
    care community of the safety and efficacy of the products and
    competing products;
    the availability and level of third-party reimbursement for
    sales of the products;
    the continued availability of adequate supplies of the products
    to meet demand;
    the strength of marketing and distribution support;
    any unfavorable publicity concerning us, our products or the
    markets for these products, such as information concerning
    product contamination or other safety issues in the markets for
    our products, whether or not directly involving our products;
    regulatory developments related to our marketing and promotional
    practices or the manufacture or continued use of our
    products; and
    changes in intellectual property protection available for the
    products or competing treatments. 34




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Our
    strategy of obtaining, through product acquisitions and
    in-licenses, rights to products and product candidates for our
    development pipeline and to proprietary drug delivery and
    formulation technologies for our life cycle management of
    current products may not be successful.
        
    We may be unable to license or acquire the relevant products,
    product candidates or technologies on terms that would allow us
    to make an appropriate return on investment;
    Companies that perceive us as a competitor may be unwilling to
    license or sell their product rights or technologies to us;
    We may be unable to identify suitable products, product
    candidates or technologies within our areas of
    expertise; and
    We may have inadequate cash resources or may be unable to obtain
    financing to acquire rights to suitable products, product
    candidates or technologies from third parties.    We
    face competition, which may result in others discovering,
    developing or commercializing products before or more
    successfully than us.
     35




---



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Form 10-K.
     36




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If we
    fail to manage successfully our product acquisitions, our
    ability to develop our product candidates and expand our product
    pipeline may be harmed.
    
    the overuse of cash resources;
    higher than anticipated acquisition costs and expenses;
    potentially dilutive issuances of equity securities;
    the incurrence of debt and contingent liabilities, impairment
    losses
    and/or
    restructuring charges;
    the assumption of or exposure to unknown liabilities;
    the development and integration of new products that could
    disrupt our business and occupy our managements time and
    attention;
    the inability to preserve key suppliers or distributors of any
    acquired products; and
    the acquisition of products that could substantially increase
    our amortization expenses.      As our
    competitors introduce their own pharmaceutical and/or
    therapeutic equivalents of our products, our net revenues from
    such products are expected to decline.
  and/or
   37




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If our
    third-party manufacturers and packagers do not obtain the
    necessary quota for controlled substances needed to supply us
    with our products or the quotas are not sufficient, we may be
    unable to meet commercial demand for the products.
    If we
    or our contract manufacturers or packagers fail to comply with
    regulatory requirements for our controlled substance products
    and product candidates, the DEA may take regulatory actions
    detrimental to our business, resulting in temporary or permanent
    interruption of distribution, withdrawal of products from the
    market or other penalties.
    Fluoroquinolone
    products have been associated with the risk of tendonitis and
    tendon ruptures. FACTIVE is a fluoroquinolone product and must
    comply with the FDA directives on prescribing information for
    fluoroquinolones.
     38




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Concerns
    regarding the potential toxicity and addictiveness of
    propoxyphene and the known liver toxicity of acetaminophen may
    limit market acceptance of our propoxyphene/acetaminophen
    products or cause the FDA to remove these products from the
    market.
    over-the-counter
  Concerns
    regarding the safety profile of ZYFLO CR and ZYFLO may limit
    market acceptance of ZYFLO CR.
     39




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We
    rely on third parties to market and promote some products, and
    these third parties may not successfully commercialize these
    products.
      The
    concentration of our product sales to only a few wholesale
    distributors increases the risk that we will not be able to
    effectively distribute our products if we need to replace any of
    these customers, which would cause our sales to
    decline.
      Our
    business could suffer as a result of a failure to manage and
    maintain our distribution network.
     40




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If any
    of the third parties that we rely upon for assistance in
    researching, developing, manufacturing, promoting and
    distributing our products and product candidates experience
    financial distress and is unable to provide this assistance, our
    operating performance would be adversely affected.
    If we
    are unable to attract, hire and retain qualified sales and
    marketing personnel, the commercial opportunity for our products
    and product candidates may be diminished.
    A
    failure to maintain optimal inventory levels could harm our
    reputation and subject us to financial losses.
     41




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12-month
      Product
    liability lawsuits against us could cause us to incur
    substantial liabilities and to limit commercialization of any
    products that we may develop.
    
    decreased demand for our products or any products that we may
    develop;
    injury to our reputation;
    the withdrawal of clinical trial participants;
    the withdrawal of a product from the market;
    costs to defend the related litigation;
    substantial monetary awards to clinical trial participants or
    patients;
    diversion of management time and attention;
    loss of revenue; and 42




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
    inability to commercialize the products that we may develop.      Risks
    Relating to Product Development and Regulatory Matters
  Some
    of our specialty pharmaceutical products are now being marketed
    without approved NDAs or ANDAs.
       43




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If we
    are unable to develop safe and efficacious formulations of our
    product candidates, or our clinical trials for our product
    candidates are not successful, we may not be able to develop,
    obtain regulatory approval for and commercialize these product
    candidates successfully.
          If
    clinical trials for our product candidates are delayed, we would
    incur additional costs and delay the receipt of any revenues
    from product sales.
      
    we, the FDA, a third party assisting us with product development
    or an IRB suspending or stopping a clinical trial;
    discussions with the FDA regarding the scope or design of our
    clinical trials;
    delay in obtaining, or the inability to obtain, required
    permissions from regulators, IRBs or other governing entities at
    clinical sites selected for participation in our clinical trials; 44




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
    the number of patients required for our clinical trials may be
    larger than we anticipate, enrollment in our clinical trials may
    be slower than we anticipate or participants may drop out of our
    clinical trials at a higher rate than we anticipate;
    our clinical trials may produce negative or inconclusive
    results, and we may decide, or regulators may require us, to
    conduct additional clinical trials, or we may abandon projects
    that had appeared to be promising;
    we or our third-party contractors may fail to comply with
    regulatory requirements or meet their contractual obligations in
    a timely manner;
    insufficient supply or deficient quality of product candidate
    materials or other materials necessary to conduct clinical
    trials;
    unfavorable FDA inspection and review of a clinical trial site
    or records of any clinical investigation; or
    exposure of participants to unacceptable health risks.            If we
    are unable to obtain required regulatory approvals, we will be
    unable to commercialize our product candidates, and our ability
    to generate revenue will be materially impaired.
   45




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If our
    clinical trials and other studies do not demonstrate safety and
    efficacy in humans, we may experience delays, incur additional
    costs and ultimately be unable to commercialize our product
    candidates.
          Our
    sales depend on payment and reimbursement from third-party
    payors, and a reduction in the payment rate or reimbursement
    could result in decreased use or sales of our
    products.
   46




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If we
    fail to comply with regulatory requirements for our products or
    if we experience unanticipated problems with them, the FDA may
    take regulatory actions detrimental to our business, resulting
    in temporary or permanent interruption of distribution,
    withdrawal of products from the market or other
    penalties.
   47




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
    withdrawal of the products from the market;
    restrictions on the marketing or distribution of such products;
    restrictions on the manufacturers or manufacturing processes;
    warning letters;
    refusal to approve pending applications or supplements to
    approved applications that we submit;
    recalls; 48




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
    fines;
    suspension or withdrawal of regulatory approvals;
    refusal to permit the import or export of our products;
    product seizures; or
    injunctions or the imposition of civil or criminal penalties.    We
    will spend considerable time and money complying with federal
    and state laws and regulations, and, if we are unable to fully
    comply with such laws and regulations, we could face substantial
    penalties.
    
    The federal anti-kickback statute is a criminal statute that
    makes it a felony for individuals or entities knowingly and
    willfully to offer or pay, or to solicit or receive, direct or
    indirect remuneration, in order to induce the purchase, order,
    lease, or recommending of items or services, or the referral of
    patients for services, that are reimbursed under a federal
    health care program, including Medicare and Medicaid;
    The federal False Claims Act imposes liability on any person who
    knowingly submits, or causes another person or entity to submit,
    a false claim for payment of government funds. Penalties include
    three times the governments damages plus civil penalties
    of $5,500 to $11,000 per false claim. In addition, the False
    Claims Act permits a person with knowledge of fraud, referred to
    as a qui tamplaintiff, to file a lawsuit on behalf of
    the government against the person or business that committed the
    fraud, and, if the action is successful, the qui tamplaintiff is rewarded with a percentage of the recovery;
    HIPAA imposes obligations, including mandatory contractual
    terms, with respect to safeguarding the privacy, security and
    transmission of individually identifiable health information;
    The Social Security Act contains numerous provisions allowing
    the imposition of a civil money penalty, a monetary assessment,
    exclusion from the Medicare and Medicaid programs, or some
    combination of these penalties; and
    Many states have analogous state laws and regulations, such as
    state anti-kickback and false claims laws. In some cases, these
    state laws impose more strict requirements than the federal
    laws. Some state laws also require pharmaceutical companies to
    comply with certain price reporting and other compliance
    requirements.   49




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Risks
    Relating to Our Dependence on Third Parties
  We use
    third parties to manufacture all of our products and product
    candidates. This may increase the risk that we will not have
    sufficient quantities of our products or product candidates at
    an acceptable cost, which could result in clinical development
    and commercialization of product candidates being delayed,
    prevented or impaired.
      
    We may not be able to meet commercial demands for our products;
    We may be required to cease distribution or issue recalls;
    We may not be able to initiate or continue clinical trials of
    product candidates that are under development; and
    We may be delayed in submitting applications for regulatory
    approvals for product candidates.   50




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Risks
    Relating to Intellectual Property and Licenses
  If we
    are unable to obtain and maintain protection for the
    intellectual property relating to our technology and products,
    the value of our technology and products will be adversely
    affected.
   51




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The
    composition of matter patent for the API in ZYFLO CR and ZYFLO
    will expire in December 2010 and the composition of matter
    patent for the API in FACTIVE will expire in April 2017. None of
    our other current products or current product candidates have,
    or will have, composition of matter patent
    protection.
     52




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Our
    patents may be challenged by ANDA applicants.
    and/or
    Trademark
    protection of our products may not provide us with a meaningful
    competitive advantage.
    ® ®
 53




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If we
    fail to comply with our obligations in our intellectual property
    licenses with third parties, we could lose license rights that
    are important to our business.
    If we
    are unable to protect the confidentiality of our proprietary
    information and know-how, the value of our technology and
    products could be adversely affected.
    If we
    infringe or are alleged to infringe intellectual property rights
    of third parties, our business will be adversely
    affected.
     54




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and/or
  Risks
    Relating to Financial Results
  We may
    need additional funding and may be unable to raise capital when
    needed, which could force us to delay, reduce or eliminate our
    product development or commercialization efforts.
        
    the level of product sales from our currently marketed products
    and any additional products that we may market in the future;
    the scope, progress, results and costs of development activities
    for our current product candidates;
    the costs, timing and outcome of regulatory review of our
    product candidates;
    the number of, and development requirements for, additional
    product candidates that we pursue;
    the costs of commercialization activities, including product
    marketing, sales and distribution;
    the costs and timing of establishing manufacturing and supply
    arrangements for clinical and commercial supplies of our product
    candidates and products;
    the extent to which we acquire or invest in products, businesses
    and technologies; 55




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
    the extent to which we chooses to establish collaboration,
    co-promotion, distribution or other similar arrangements for our
    marketed products and product candidates; and
    the costs of preparing, filing and prosecuting patent
    applications and maintaining, enforcing and defending claims
    related to intellectual property owned by or licensed to us.  The
    terms of any additional capital funding that we require may not
    be favorable to us or our stockholders.
      We may
    incur losses in the future.
    
    establishing a sales and marketing infrastructure;
    acquiring marketed products, product candidates and related
    technologies;
    commercializing marketed products; and
    developing product candidates, including conducting clinical
    trials.    
    advance the development of our product candidates;
    seek regulatory approvals for product candidates that
    successfully complete clinical testing; and
    expand our sales force and marketing capabilities to prepare for
    the commercial launch of future products, subject to FDA
    approval.      
    successfully completing clinical trials of our product
    candidates;
    obtaining and maintaining regulatory approval for these product
    candidates; and
    manufacturing, marketing and selling those products for which we
    may obtain regulatory approval.   56




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If the
    estimates that we make, or the assumptions upon which we rely,
    in preparing our financial statements prove inaccurate, the
    actual results may vary from those reflected in our
    projections.
  product-by-product
  Our
    operating results are likely to fluctuate from period to
    period.
    
    seasonality of the cough/cold and allergy seasons, which
    historically results in higher sales of our respiratory products
    during the first and fourth quarters of the calendar year;
    new product launches, which could increase revenues but also
    increase sales and marketing expenses;
    acquisition activity;
    charges for inventory expiration or product quality issues;
    changes in the amount and timing of sales of our products due to
    changes in product pricing, changes in the prevalence of disease
    conditions from period to period or other factors;
    the timing of operating expenses, including selling and
    marketing expenses and the costs of maintaining a direct sales
    force;
    changes in research and development expenses resulting from the
    acquisition of product candidates or from general and
    industry-specific economic conditions;
    changes in the competitive, regulatory or reimbursement
    environment, including the amounts of rebates, discounts,
    holdbacks, chargebacks and returns, which could decrease
    revenues or increase sales and marketing, product development or
    compliance costs;
    unexpected product liability or intellectual property claims and
    lawsuits;
    significant payments, such as milestones, required under
    collaboration, licensing and development agreements before the
    related product candidate has received FDA approval;
    marketing exclusivity, if any, which may be obtained on certain
    new products;
    the dependence on a small number of products for a significant
    portion of net revenues and net income;
    price erosion and customer consolidation;
    the results of ongoing and planned clinical trials of our
    product candidates;
    the results of regulatory reviews relating to the development or
    approval of our product candidates; and
    production problems occurring at our third-party manufacturers. 57




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If we
    fail to maintain an effective system of internal control over
    financial reporting, we may not be able to accurately report our
    financial results. As a result, current and potential
    stockholders could lose confidence in our financial reporting,
    which would harm our business and the trading price of our
    stock.
      Risks
    Relating to Employee Matters and Managing Growth
  If we
    fail to attract and retain key personnel, or to retain our
    executive management team, we may be unable to successfully
    develop or commercialize our products.
     58




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Risks
    Relating to Common Stock
  Our
    stock price is subject to fluctuation, which may cause an
    investment in our stock to suffer a decline in
    value.
      
    the results of discovery, preclinical studies and clinical
    trials;
    significant acquisitions, strategic partnerships, joint ventures
    or capital commitments.
    the entry into, amendment or termination of key agreements,
    including licensing and collaboration agreements;
    the results and timing of regulatory reviews relating to the
    approval of product candidates;
    the initiation of material developments in or conclusion of
    litigation to enforce or defend intellectual property rights;
    failure of any product candidates, if approved, to achieve
    commercial success;
    general and industry-specific economic conditions that may
    affect research and development expenditures;
    issues in manufacturing products or product candidates;
    the loss of key employees;
    the acquisition, development or introduction of technologies,
    product candidates or products;
    changes in the structure of health care payment systems;
    regulatory actions with respect to products;
    our financial results, including
    period-to-period
    fluctuations in those results;
    changes in estimates or recommendations by securities analysts,
    if any, who cover our common stock; and
    future sales of our common stock,    Chiesi
    has substantial control over us and could delay or prevent a
    change in corporate control, including a transaction in which
    our stockholders could sell or exchange their shares for a
    premium.
   59




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
    reconstitute our board of directors to be comprised of two
    classes of directors, with our Class A Directors consisting
    of our Chief Executive Officer and three independent directors
    and our Class B Directors consisting of four persons
    designated by Chiesi, or the Chiesi Designees (the number of
    Chiesi Designees will decrease depending on the level of
    Chiesis and its affiliates ownership of our common
    stock);
    so long as Chiesi and its affiliates beneficially own at least
    50% of our common stock, require board actions to be taken by a
    majority in voting power of the directors present, and further
    provide that the Class B Directors present at a meeting
    will collectively have the same voting power as the Class A
    Directors present at the meeting; and
    so long as Chiesi and its affiliates beneficially own at least
    40% of our common stock, require Chiesis or our full board
    of directors approval of certain corporate actions.      ITEM 1B.
    UNRESOLVED
    STAFF COMMENTS    ITEM 2.
    PROPERTIES    ITEM 3.
    LEGAL
    PROCEEDINGS   60




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Cornerstone BioPharma, Inc. v.
    Vision Pharma, LLC
  ® ®
 61




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ITEM 4.
    (REMOVED
    AND RESERVED) 62




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EXECUTIVE
    OFFICERS OF THE REGISTRANT    Name

Age

PositionCraig A. Collard


43


President and Chief Executive OfficerSteven M. Lutz


43


Executive Vice President, Manufacturing and TradeDavid Price


47


Executive Vice President, Finance, Chief Financial Officer and
    TreasurerJoshua B. Franklin


40


Vice President, Sales and MarketingAlan Roberts


43


Vice President, Scientific AffairsAndrew K. W. Powell


52


Executive Vice President, General Counsel and Secretary   Craig A. Collard
  Steven M. Lutz
  David Price
 63




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Joshua B. Franklin
  Alan Roberts
  Andrew K. W. Powell, Esq.
 64




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PART II  ITEM 5.
    MARKET
    FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS
    AND ISSUER PURCHASES OF EQUITY SECURITIES  Market
    Price of and Dividends on Cornerstone Therapeutics Inc.s
    Common Stock and Related Stockholder Matters
    Year Ended December 31, 2009

High


LowFirst Quarter (from January 1 to March 31)

$
4.70


$
1.72Second Quarter (from April 1 to June 30)

$
12.29


$
3.50Third Quarter (from July 1 to September 30)

$
11.23


$
6.08Fourth Quarter (from October 1 to December 31)

$
6.76


$
4.80   Year Ended December 31, 2008

High


LowFirst Quarter (from January 1 to March 31)

$
14.50


$
6.70Second Quarter (from April 1 to June 30)

$
7.20


$
2.60Third Quarter (from July 1 to September 30)

$
4.20


$
1.20Fourth Quarter (from October 1 to December 31)

$
4.99


$
1.30       Recent
    Sales of Unregistered Securities; Uses of Proceeds From
    Registered Securities
    Issuer
    Purchases of Equity Securities
     ITEM 6.
    SELECTED
    FINANCIAL DATA   65




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ITEM 7.
    MANAGEMENTS
    DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
    OPERATIONS  The following discussion is designed to provide a better
    understanding of our consolidated financial statements,
    including a brief discussion of our business and products, key
    factors that impacted our performance, and a summary of our
    operating results. You should read the following discussion and
    analysis of financial condition and results of operations
    together with our consolidated financial statements and the
    related notes included in this annual report on
    Form 10-K.
    In addition to historical information, the following discussion
    contains forward-looking statements that involve risks,
    uncertainties and assumptions. Our actual results could differ
    materially from those anticipated by the forward-looking
    statements due to important factors including, but not limited
    to, those set forth in the Risk Factors section of
    this annual report on
    Form 10-K.
  Executive
    Overview
  Strategy
             66




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2009
    Highlights
    
    Our net revenues for the year increased 69% to
    $109.6 million, of which the percentage of revenue derived
    from non-strategic products declined from 84.7% to 63.4%;
    Cash and cash equivalents increased $9.6 million or 103% to
    $18.9 million at December 31, 2009 compared to
    $9.3 million at December 31, 2009;
    We acquired an exclusive ten-year license to the commercial
    rights to Chiesis lung surfactant CUROSURF in the United
    States;
    We acquired the commercial rights to the antibiotic FACTIVE in
    North America and certain countries in Europe; and
    We made a regulatory filing with the FDA in July 2009 for our
    product candidate CRTX 067.  Opportunities
    and Trends
    
    Sales growth of our strategic specialty products through our
    respiratory and hospital sales forces;
    Cash generation from continued sales of our non-strategic
    products;
    Acquisition of rights to available and profitable new
    respiratory and related products with intellectual property
    protection;
    Progress in the development of our product candidates;
    Control of our manufacturing and general and administrative
    expenses; and 67




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
    Identification of partners and entry into value-maximizing
    transactions to divest our non-core technologies.    Results
    of Operations
  Comparison
    of the Years Ended December 31, 2009 and 2008
    Year Ended December 31,Change


Change2009


2008


$


%Net Product SalesCUROSURF

$
10,463


$



$
10,463



NMFACTIVE


1,178







1,178



NMSPECTRACEF product family


9,390



6,981



2,409



35
%ZYFLO product family(1)


17,959



888



17,071



1922ALLERX Dose Pack products


31,707



26,395



5,312



20HYOMAX product family


28,148



22,962



5,186



23Propoxyphene/acetaminophen products


9,608



5,548



4,060



73Other currently marketed products


683



692



(9
)


(1
)Discontinued products


152



(261
)


413



158Total net product sales


109,288



63,205



46,083



73Royalty agreement revenues


276



1,662



(1,386
)


(83
)Net Revenues


109,564



64,867



44,697



69Cost of product sales (exclusive of amortization of product
    rights)


19,457



5,951



13,506



227Sales and marketing


27,605



16,993



10,612



62Royalties


18,775



16,193



2,582



16General and administrative


17,422



9,930



7,492



75Research and development


4,312



3,838



474



12Amortization of product rights


6,115



1,334



4,781



358Income from operations


15,878



10,628



5,250



49Total other expenses, net


(128
)


(1,221
)


(1,093
)


(90
)Income before income taxes


15,750



9,407



6,343



67Provision for income taxes


(5,547
)


(414
)


5,133



1240Net income

$
10,203


$
8,993


$
1,210



13
%Net income per share, diluted

$
0.54


$
1.14


$
(0.60
)


(53
)%Non-GAAP income from operations(2)

$
27,034


$
12,711


$
14,323



113
%Non-GAAP net income(2)

$
17,432


$
10,984


$
6,448



59
%Non-GAAP net income per share, diluted(2)

$
0.93


$
1.40


$
(0.47
)


(34
)%     (1)
    
    Does not include the historical sales of ZYFLO CR and ZYFLO made
    by Critical Therapeutics.(2)
    
    A reconciliation of our non-GAAP financial measures to the
    comparable GAAP financial measures is included below.  NM
    
    Not meaningful. 68




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Net
    Revenues
  Net
    Product Sales.
                Royalty Agreement Revenues.
  Costs and
    Expenses
  Cost of Product Sales.
    Year Ended December 31,Change


Change2009


2008


$


%Net product sales

$
109,288


$
63,205


$
46,083



73
%Cost of product sales (exclusive of amortization of product
    rights)


19,457



5,951



13,506



227Gross margin

$
89,831


$
57,254


$
32,577



57
%% of net product sales


82
%


91
%






(9
%)    69




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Sales and Marketing Expenses.
  Royalty Expenses.
  General and Administrative Expenses.
  Research and Development Expenses. and/or
  ProjectInception to


Year Ended December 31,December 31,








Change


Change2009


2009


2008


$


%CRTX 067

$
3,058


$
2,442


$
616


$
1,826



296
%CRTX 058


638



366



272



94



35CRTX 068


593



72



521



(449
)


(86
)CRTX 062


272



15



257



(242
)


(94
)Marketed products support






704



159



545



343Other projects






713



2,013



(1,300
)


(65
)Total





$
4,312


$
3,838


$
474



12
%      70




---



##### Table of Contents



Amortization of Product Rights.
  Other Expenses.
  Provision
    for Income Taxes
    Quarterly
    Results of Operations
  Form 10-K
 71




---



##### Table of Contents



Comparison
    of the Years Ended December 31, 2008 and 2007
    Year Ended December 31,Change


Change2008


2007


$


%Net Product SalesSPECTRACEF product family

$
6,981


$
6,886


$
95



1
%ZYFLO product family(1)


888







888



NMALLERX Dose Pack products


26,395



14,180



12,215



86HYOMAX product family


22,962







22,962



NMPropoxyphene/acetaminophen products


5,548



4,403



1,145



26Other currently marketed products


692



99



593



599Discontinued products


(261
)


679



(940
)


(138
)Total net product sales


63,205



26,247



36,958



141Royalty agreement revenues


1,662



1,824



(162
)


(9
)Net Revenues


64,867



28,071



36,796



131Cost of product sales (exclusive of amortization of product
    rights)


5,951



3,300



2,651



80Sales and marketing


16,993



10,391



6,602



64Royalties


16,193



3,409



12,784



375General and administrative


9,930



4,422



5,508



125Research and development


3,838



948



2,890



305Amortization of product rights


1,334



3,160



(1,826
)


(58
)Income from operations


10,628



2,441



8,187



335Total other expenses, net


(1,221
)


(1,741
)


(520
)


(30
)Income before income taxes


9,407



700



8,707



1244Provision for income taxes


(414
)


(130
)


284



218Net income

$
8,993


$
570


$
8,423



1478
%Net income per share, diluted

$
1.14


$
0.08


$
1.06



1325
%Non-GAAP income from operations(2)

$
12,711


$
6,402


$
6,309



99
%Non-GAAP net income(2)

$
10,984


$
3,794


$
7,190



190
%Non-GAAP net income per shares, diluted(2)

$
1.40


$
0.56


$
0.84



150
%     (1)
    
    Does not include the historical sales of ZYFLO CR and ZYFLO made
    by Critical Therapeutics.(2)
    
    A reconciliation of our non-GAAP financial measures to the
    comparable GAAP financial measures is included below.   72




---



##### Table of Contents



Net
    Revenues
  Net
    Product Sales
        Royalty Agreement Revenues.
  Costs and
    Expenses
  Cost of Product Sales.
    Year Ended December 31,Change


Change2008


2007


$


%Net product sales

$
63,205


$
26,247


$
36,958



141
%Cost of product sales (exclusive of amortization of product
    rights)


5,951



3,300



2,651



80Gross margin

$
57,254


$
22,947


$
34,307



150
%% of net product sales


91
%


87
%






4
%     Sales and Marketing Expenses.
   73




---



##### Table of Contents



Royalty Expenses.
  General and Administrative Expenses.
  Research and Development Expenses.
  Year Ended December 31,Change


Change2008


2007


$


%CRTX 067

$
616


$



$
616



NMCRTX 058


272







272



NMCRTX 068


521







521



NMCRTX 062


257







257



NMMarketed products support


159



410



(251
)


(61
)%Other projects


2,013



538



1,475



274Total

$
3,838


$
948


$
2,890



305
%         Amortization of Product Rights.
  Other Expenses.
  Provision
    for Income Taxes
    Reconciliation
    of Non-GAAP Financial Measures
   74




---



##### Table of Contents



75




---



##### Table of Contents



For the Year Ended December 31,2009


2008


2007GAAP income from operations

$
15,878


$
10,628


$
2,441Add: stock-based compensation(1)


1,478



749



801Add: amortization of product rights


6,115



1,334



3,160Add: acquisition-related expenses(2)


3,563







Non-GAAP income from operations

$
27,034


$
12,711


$
6,402GAAP net income

$
10,203


$
8,993


$
570Add: stock-based compensation(1)


1,478



749



801Add: amortization of product rights


6,115



1,334



3,160Add: acquisition-related expenses(2)


3,563







Less: tax effects related to above items(3)


(3,927
)


(92
)


(737
)Non-GAAP net income

$
17,432


$
10,984


$
3,794GAAP net income per share, diluted

$
0.54


$
1.14


$
0.08Non-GAAP net income per share, diluted

$
0.93


$
1.40


$
0.56Shares used in diluted net income per share calculation:GAAP net income


18,776,588



7,861,119



6,751,127Non-GAAP net income


18,776,588



7,861,119



6,751,127     (1)
    
    Stock-based compensation excludes stock-based compensation
    charges incurred in connection with the Chiesi transaction,
    which are included in acquisition-related expenses.(2)
    
    Acquisition-related expenses include stock-based compensation
    charges and legal, accounting and related costs that resulted
    from or were incurred in connection with the Chiesi transaction.
    For the year ended December 31, 2009, acquisition-related
    stock-based compensation charges include $1.5 million and
    $262,000 of charges that were included in general and
    administrative and sales and marketing expenses, respectively,
    in the Companys consolidated statement of income.(3)
    
    Tax effects for the years ended December 31, 2009, 2008 and
    2007 are calculated using effective tax rates of 35.2%, 4.4%,
    and 18.6% respectively.  Liquidity
    and Capital Resources
  Sources
    of Liquidity
   76




---



##### Table of Contents



Cash
    Flows
    Year Ended December 31,2009


2008


2007Cash provided by (used in):Operating activities

$
450


$
12,629


$
1,563Investing activities


(5,504
)


(346
)


(718
)Financing activities


14,621



(3,238
)


(720
)Net increase in cash and cash equivalents

$
9,567


$
9,045


$
125   Net Cash
    Provided By Operating Activities
       77




---



##### Table of Contents



Net Cash
    Used in Investing Activities
          Net Cash
    Provided by (Used in) Financing Activities
       78




---



##### Table of Contents



Funding
    Requirements
    
    the level of product sales of our currently marketed products
    and any additional products that we may market in the future;
    the scope, progress, results and costs of development activities
    for our current product candidates;
    the costs, timing and outcome of regulatory review of our
    product candidates;
    the number of, and development requirements for, additional
    product candidates that we pursue;
    the costs of commercialization activities, including product
    marketing, sales and distribution;
    the costs and timing of establishing manufacturing and supply
    arrangements for clinical and commercial supplies of our product
    candidates and products;
    the extent to which we acquire or invest in products, businesses
    and technologies;
    the extent to which we choose to establish collaboration,
    co-promotion, distribution or other similar arrangements for our
    marketed products and product candidates; and
    the costs of preparing, filing and prosecuting patent
    applications and maintaining, enforcing and defending claims
    related to intellectual property owned by or licensed to us.      Contractual
    Obligations
  and/or
 79




---



##### Table of Contents



Payments Due by PeriodLess than








More thanTotal


1 Year


1-3 Years


3-5 Years


5 YearsCapital lease obligations

$
62


$
15


$
31


$
16


$
Operating leases(1)


3,678



766



1,041



1,120



751Purchase obligations(2)


46,753



26,791



16,969



2,993



Royalty obligations(3)


7,500



500



1,150



1,050



4,800Other long-term liabilities(4)


2,750



1,250



1,500







Total contractual obligations

$
60,743


$
29,322


$
20,691


$
5,179


$
5,551     (1)
    
    Operating leases include minimum payments under leases for our
    facilities, automobiles and certain equipment. In October 2009,
    we entered into a lease modification agreement for our corporate
    headquarters. Our total minimum lease payments for the corporate
    headquarters are $400,000 in 2010, $482,000 in 2011, $492,000 in
    2012, $536,000 in 2013 and $1.3 million thereafter.(2)
    
    Purchase obligations include fixed or minimum payments under
    manufacturing and supply agreements with third-party
    manufacturers of $29.5 million; clinical trial and research
    agreements with contract research organizations and consultants
    of $741,000; agreements with providers of marketing analytical
    services of $3.2 million; and open purchase orders for the
    acquisition of goods and services in the ordinary course of
    business of $13.4 million.(3)
    
    Royalty obligations include minimum royalty payments due in
    connection with our agreements with Pharmaceutical Innovations
    and The Feinstein Institute. See Note 11 of our Notes to
    Consolidated Financial Statements of this annual report on
    Form 10-K
    for additional information.(4)
    
    Other long-term liabilities include principal and interest due
    under our license agreement liability with Meiji. See
    Note 7 of our Notes to Consolidated Financial Statements of
    this annual report on
    Form 10-K
    for a description of the amounts due under the license agreement.  and/or
  Off-Balance
    Sheet Arrangements
    Effects
    of Inflation
   80




---



##### Table of Contents



Critical
    Accounting Policies and Estimates
    Form 10-K
  Revenue
    Recognition
  Net
    Product Sales
  Product Sales.
    Product Returns. 18-month 18-month
   81




---



##### Table of Contents



Rebates.
    Price Adjustments and Chargebacks. and/or
  point-of-sale
    Prompt Payment Discounts. and/or
      Royalty
    Agreement Revenues
   82




---



##### Table of Contents



Goodwill
    and Product Rights
          Inventory
  and/or
 83




---



##### Table of Contents



first-in,
  Stock-Based
    Compensation
      over-the-counter;
   84




---



##### Table of Contents



Income
    Taxes
           85




---



##### Table of Contents



Recent
    Accounting Pronouncements
  Form 10-K
  ITEM 7A.
    QUANTITATIVE
    AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK  Interest
    Rate Risk
      Foreign
    Currency Exchange Risk
  dollar-to-Euro dollar-to-Euro
 86




---



##### Table of Contents



ITEM 8.
    FINANCIAL
    STATEMENTS AND SUPPLEMENTARY DATA  INDEX TO
    CONSOLIDATED FINANCIAL STATEMENTS
  PageReport of Independent Registered Public
    Accounting Firm


88Consolidated Balance Sheets as of
    December 31, 2009 and 2008


89Consolidated Statements of Income for the Years
    ended December 31, 2009, 2008 and 2007


90Consolidated Statements of Stockholders
    Equity (Deficit) and Comprehensive Income for the Years ended
    December 31, 2009, 2008 and 2007


91Consolidated Statements of Cash Flows for the
    Years ended December 31, 2009, 2008 and 2007


92Notes to Consolidated Financial Statements


93Schedule II Valuation and Qualifying
    Accounts


120  87




---



##### Table of Contents



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM           Internal Control 
    Integrated Framework )
       88




---



##### Table of Contents



CORNERSTONE
    THERAPEUTICS INC.
  CONSOLIDATED
    BALANCE SHEETS
 (In
    thousands, except share and per share data)
  December 31,2009


2008AssetsCurrent assets:Cash and cash equivalents

$
18,853


$
9,286Marketable securities






300Accounts receivable, net


16,548



12,987Inventories, net


18,106



11,222Prepaid and other current assets


4,808



1,754Deferred income tax asset


3,507



2,428Total current assets


61,822



37,977Property and equipment, net


1,312



895Product rights, net


126,806



17,702Goodwill


13,231



13,231Amounts due from related parties


38



38Other assets


113



46Total assets

$
203,322


$
69,889Liabilities and Stockholders EquityCurrent liabilities:Accounts payable

$
7,172


$
10,288Accrued expenses


23,703



19,052Current portion of license agreement liability


1,019



2,543Current portion of capital lease


10



Income taxes payable


1,606



2,937Total current liabilities


33,510



34,820License agreement liability, less current portion


1,341



2,313Capital lease, less current portion


39



Deferred income tax liability


4,564



3,330Total liabilities


39,454



40,463Commitments and contingencies, Note 11Stockholders equityPreferred stock  $0.001 par value,
    5,000,000 shares authorized; no shares issued and
    outstanding






Common stock  $0.001 par value,
    90,000,000 shares authorized; 25,022,644 and
    12,023,747 shares issued and outstanding as of
    December 31, 2009 and December 31, 2008, respectively


25



12Additional paid-in capital


157,745



33,519Retained earnings (accumulated deficit)


6,098



(4,105
)Total stockholders equity


163,868



29,426Total liabilities and stockholders equity

$
203,322


$
69,889    89




---



##### Table of Contents



CORNERSTONE
    THERAPEUTICS INC.
  CONSOLIDATED
    STATEMENTS OF INCOME
 (In
    thousands, except share and per share data)
  Year Ended December 31,2009


2008


2007Net revenues

$
109,564


$
64,867


$
28,071Costs and expenses:Cost of product sales (exclusive of amortization of product
    rights)


19,457



5,951



3,300Sales and marketing


27,605



16,993



10,391Royalties


18,775



16,193



3,409General and administrative


17,422



9,930



4,422Research and development


4,312



3,838



948Amortization of product rights


6,115



1,334



3,160Total costs and expenses


93,686



54,239



25,630Income from operations


15,878



10,628



2,441Other expenses, net:Interest expense, net


(128
)


(1,211
)


(1,410
)Loss on marketable security






(8
)


(323
)Other expenses






(2
)


(8
)Total other expenses, net


(128
)


(1,221
)


(1,741
)Income before income taxes


15,750



9,407



700Provision for income taxes


(5,547
)


(414
)


(130
)Net income

$
10,203


$
8,993


$
570Net income per share, basic

$
0.58


$
1.29


$
0.10Net income per share, diluted

$
0.54


$
1.14


$
0.08Weighted-average common shares, basic


17,651,668



6,951,896



5,934,496Weighted-average common shares, diluted


18,776,588



7,861,119



6,751,127    90




---



##### Table of Contents



CORNERSTONE
    THERAPEUTICS INC.CONSOLIDATED STATEMENTS OF
    STOCKHOLDERS EQUITY (DEFICIT) AND COMPREHENSIVE
    INCOME
    (In thousands, except share data)
  Accumulated


RetainedAdditional


Other


Earnings


Total


TotalCommon Stock


Paid-in


Comprehensive


(Accumulated


Stockholders


ComprehensiveShares


Amount


Capital


Income (Loss)


Deficit)


Equity (Deficit)


IncomeBalance as of December 31, 2006


5,934,496


$
6


$
(4
)

$
(178
)

$
(13,668
)

$
(13,844
)Stock-based compensation










801











801Unrealized loss on investment














(145
)






(145
)

$
(145
)Reclassification adjustment for losses on investments included
    in net income (net of tax)














323







323



323Net income


















570



570



570Total comprehensive income

























$
748Balance as of December 31, 2007


5,934,496


$
6


$
797


$



$
(13,098
)

$
(12,295
)Issuance of shares in connection with the Merger (net of
    issuance costs of $504)


4,325,498



4



22,971











22,975Exercise of common stock warrants


316,101







52











52Stock-based compensation










749











749Conversion of related party note payable to common stock


1,443,913



2



8,950











8,952Issuance of common stock to employees under stock incentive plan


3,959



















Restricted stock buyback


(220
)


















Net income


















8,993



8,993



8,993Total comprehensive income

























$
8,993Balance as of December 31, 2008


12,023,747


$
12


$
33,519


$



$
(4,105
)

$
29,426Issuance of shares for acquisition of product rights


12,172,425



12



119,271











119,283Cash settlement of common stock warrants










(41
)










(41
)Stock-based compensation










3,291











3,291Issuance of common stock to employees under stock incentive plan


826,472



1



436











437Tax effect of stock-based awards










1,269











1,269Net income


















10,203



10,203



10,203Total comprehensive income

























$
10,203Balance as of December 31, 2009


25,022,644


$
25


$
157,745


$



$
6,098


$
163,868    91




---



##### Table of Contents



CORNERSTONE
    THERAPEUTICS INC.
  CONSOLIDATED
    STATEMENTS OF CASH FLOWS
 (In
    thousands)
  Year Ended December 31,2009


2008


2007Cash flows from operating activitiesNet income

$
10,203


$
8,993


$
570Adjustments to reconcile net income to net cash provided by
    operating activities:Amortization and depreciation


6,392



1,425



3,231Provision for prompt payment discounts


3,157



1,887



645Provision for inventory obsolescence


1,474



599



169Stock-based compensation


3,291



749



801Loss on marketable security






8



323Write-off of acquired in-process research and development






1,900



Impairment of property and equipment






56



Benefit from deferred income taxes


(3,632
)


(3,310
)


Changes in operating assets and liabilities:Accounts receivable


(6,718
)


(9,067
)


(2,351
)Amounts due from related parties










18Inventories


(8,202
)


(2,523
)


(1,320
)Prepaid and other assets


(3,121
)


1,749



(2,456
)Accounts payable


(3,116
)


2,573



783Accrued expenses


2,053



4,505



1,020Income taxes payable


(1,331
)


3,085



130Net cash provided by operating activities


450



12,629



1,563Cash flows from investing activitiesAdvances to related parties






(19
)


(876
)Proceeds from collection of advances to related parties






657



262Proceeds from sale of marketable securities


300







Purchase of property and equipment


(635
)


(638
)


(64
)Purchase of product rights


(5,169
)


(2,450
)


(75
)Collection of deposits






223



50Payment of deposits






(237
)


(15
)Cash acquired in connection with the Merger, net of costs paid






2,118



Net cash used in investing activities


(5,504
)


(346
)


(718
)Cash flows from financing activitiesProceeds from issuance of shares of common stock


15,465







Proceeds from exercise of common stock options and warrants


437



52



Payments for cancellation of warrants


(41
)






Excess tax benefit from stock-based compensation


1,269







Principal payments on license agreement liability


(2,500
)


(576
)


(720
)Principal payments on capital lease obligation


(9
)






Principal payments on notes payable






(460
)


Proceeds from line of credit






7,250



9,000Principal payments on line of credit






(9,000
)


(9,000
)Payment of stock issuance costs in connection with the Merger






(504
)


Net cash provided by (used in) financing activities


14,621



(3,238
)


(720
)Net increase in cash and cash equivalents


9,567



9,045



125Cash and cash equivalents as of beginning of year


9,286



241



116Cash and cash equivalents as of end of year

$
18,853


$
9,286


$
241Supplemental disclosure of cash flow informationCash paid during the year for interest

$
531


$
2,734


$
433Cash paid during the year for income taxes

$
9,260


$
644


$
Supplemental schedule of non-cash investing and financing
    activitiesProduct rights acquired through issuance of a license agreement

$



$



$
2,565Related party note payable converted to common stock in
    connection with the Merger

$



$
8,952


$
Common stock issued in connection with the Merger

$



$
23,479


$
Acquisition of product rights through equity issued and
    liabilities assumed

$
110,050


$



$
    92




---



##### Table of Contents



CORNERSTONE
    THERAPEUTICS INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
  NOTE 1:
    ORGANIZATION
    AND BASIS OF PRESENTATION  Nature of
    Operations
  and/or
  Principles
    of Consolidation
    Merger
       93




---



##### Table of Contents



CORNERSTONE
    THERAPEUTICS INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Reclassifications
    NOTE 2:
    SUMMARY
    OF SIGNIFICANT ACCOUNTING POLICIES  Use of
    Estimates
    Segment
    and Geographic Information
      Concentrations
    of Credit Risk and Limited Suppliers
     94




---



##### Table of Contents



CORNERSTONE
    THERAPEUTICS INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Year Ended December 31,


December 31,2009


2008


2007Gross


Gross


Gross


2009


2008Product


Product


Product


Accounts


AccountsSales


Sales


Sales


Receivable


ReceivableCardinal Health


34
%


40
%


43
%


26
%


35
%McKesson Corporation


34
%


31
%


34
%


37
%


32
%Amerisource Bergen Corporation


20
%


15
%


14
%


24
%


16
%Total


88
%


86
%


91
%


87
%


83
%   Cash and
    Cash Equivalents
      Marketable
    Securities
  available-for-sale.
  other-than-temporary
   95




---



##### Table of Contents



CORNERSTONE
    THERAPEUTICS INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Accounts
    Receivable
  and/or
      2009


2008Accounts receivable

$
16,932


$
13,289Less allowance for prompt payment discounts


(384
)


(302
)Accounts receivable, net

$
16,548


$
12,987   Inventories
  first-in, and/or
   96




---



##### Table of Contents



CORNERSTONE
    THERAPEUTICS INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    2009


2008Raw materials

$
5,597


$
6,393Work in process


2,007



1,832Finished goods:Pharmaceutical products  trade


9,962



3,182Pharmaceutical products  samples


2,342



492Total


19,908



11,899Inventory allowances


(1,802
)


(677
)Inventories, net

$
18,106


$
11,222   Property
    and Equipment
      Useful Life (Years)

2009


2008Computers and software

3-5

$
535


$
365Machinery and equipment

3-7


236



113Furniture and fixtures

5-7


906



523Leasehold improvements

Lesser of lease term or 7


100



82Total




1,777



1,083Less accumulated depreciation




(465
)


(188
)Property and equipment, net



$
1,312


$
895       Product
    Rights
   97




---



##### Table of Contents



CORNERSTONE
    THERAPEUTICS INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Impairment
    of Long-Lived Assets
      Revenue
    Recognition
    Year Ended December 31,2009


2008


2007Gross product sales

$
148,652


$
82,547


$
31,258Sales allowances


(39,364
)


(19,342
)


(5,011
)Net product sales


109,288



63,205



26,247Royalty agreement revenues


276



1,662



1,824Net revenues

$
109,564


$
64,867


$
28,071   Net
    Product Sales
  Product Sales.
  Product Returns. 18-month
 98




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##### Table of Contents



CORNERSTONE
    THERAPEUTICS INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  ® 18-month
  Rebates.
  Price Adjustments and Chargebacks. and/or
  point-of-sale
  Prompt Payment Discounts.
  Royalty
    Agreement Revenues
    Research
    and Development
   99




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##### Table of Contents



CORNERSTONE
    THERAPEUTICS INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Advertising
    Shipping
    and Handling Costs
    Stock-Based
    Compensation
    Income
    Taxes
     100




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##### Table of Contents



CORNERSTONE
    THERAPEUTICS INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Fair
    Value of Financial Instruments
    NOTE 3:
    MERGER        Fair value of Critical Therapeutics shares outstanding

$
23,479Acquiring company transaction costs incurred


1,753Purchase price

$
25,232    101




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##### Table of Contents



CORNERSTONE
    THERAPEUTICS INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Cash and cash equivalents

$
3,871Accounts receivable


2,302Inventory


6,300Prepaid expenses and other current assets


701Fixed assets


315Other assets


40Intangible assets:Product rights


11,500Acquired in-process research and development


1,900Goodwill


13,231Assumed liabilities


(14,928
)Total

$
25,232     Raw materials

$
5,314Work in process


393Finished goods


593Total

$
6,300       ZYFLO
    CR®

    product rights

$
11,500Alpha-7 program


1,900Total

$
13,400        102




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##### Table of Contents



CORNERSTONE
    THERAPEUTICS INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Pro Forma
    Results of Operations (Unaudited)
    Year EndedDecember 31,2008


2007(Unaudited)Net revenues

$
78,972


$
40,940Net loss

$
(17,073
)

$
(38,383
)Basic and diluted net loss per common share

$
(2.46
)

$
(6.47
)   NOTE 4:
    GOODWILL
    AND PRODUCT RIGHTS  Goodwill
    Product
    Rights
    2009


2008Product rights

$
141,949


$
26,730Less accumulated amortization


(15,143
)


(9,028
)Product rights, net

$
126,806


$
17,702    103




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##### Table of Contents



CORNERSTONE
    THERAPEUTICS INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      ®
    Inventory, net

$
2,906Product rights


7,613Accrued product returns


(2,455
)Total purchase price

$
8,064           2010

$
14,3782011


14,3662012


14,3602013


14,3602014


13,612Thereafter


52,630$
123,706  104




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##### Table of Contents



CORNERSTONE
    THERAPEUTICS INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   NOTE 5:
    LINE OF
    CREDIT          NOTE 6:
    ACCRUED
    EXPENSES    2009


2008Accrued product returns

$
10,962


$
5,043Accrued rebates


1,013



884Accrued price adjustments and chargebacks


3,503



4,307Accrued compensation and benefits


2,486



2,507Accrued royalties


5,547



6,259Accrued expenses, other


192



52Total accrued expenses

$
23,703


$
19,052   NOTE 7:
    LICENSE
    AGREEMENT LIABILITY  Abbott
  ®
 105




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##### Table of Contents



CORNERSTONE
    THERAPEUTICS INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Jagotec
    Meiji
    and/or
   106




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##### Table of Contents



CORNERSTONE
    THERAPEUTICS INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    2009


2008License agreement liability to Abbott; imputed interest at 5%
    per annum; principal and interest payable in May 2009

$



$
1,471License agreement liability to Jagotec; imputed interest at 5%
    per annum; principal and interest payable in May 2009






368License agreement liability to Meiji; imputed interest at 12%
    per annum; principal and interest payable for the remaining
    three and four years, respectively


2,360



3,017Less current portion


(1,019
)


(2,543
)Long-term

$
1,341


$
2,313     2010

$
1,0192011


1,341Total

$
2,360   NOTE 8:
    STOCKHOLDERS
    EQUITY  Authorized
    Capital
    Warrants
    to Purchase Common Stock
     107




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##### Table of Contents



CORNERSTONE
    THERAPEUTICS INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        NOTE 9:
    STOCK-BASED
    COMPENSATION  Overview
    of Stock-Based Compensation Plans
  2000
    Equity Plan and 2003 Stock Incentive Plan Assumed from Critical
    Therapeutics in the Merger
    2004
    Stock Incentive Plan Assumed from Critical Therapeutics in the
    Merger
       108




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##### Table of Contents



CORNERSTONE
    THERAPEUTICS INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    2005
    Stock Option Plan and 2005 Stock Incentive Plan
          Stock
    Options
      Year Ended December 31,2009


2008


2007Estimated dividend yield


0.0%



0.0%



0.0%Expected stock price volatility


75%



75%



68%Risk-free interest rate


2.31% - 2.85%



1.43% - 3.05%



3.52% - 4.79%Expected life of option (in years)


4.84



6.00



6.04Weighted-average grant date fair value per share


$4.85



$2.50



$1.15    109




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##### Table of Contents



CORNERSTONE
    THERAPEUTICS INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
          Weighted-AverageRemainingWeighted


Contractual


AggregateNumber of


Average


Life


Intrinsic ValueOptions


Exercise Price


(in Years)


(in thousands)Outstanding at January 1, 2009


2,437,572


$
5.45Granted


523,833


$
7.94Exercised


(393,105
)

$
1.11Forfeited


(277,740
)

$
4.08Expired


(243,896
)

$
36.96Outstanding at December 31, 2009


2,046,664


$
3.36



6.34


$
6,779Vested or expected to vest at December 31, 2009


2,007,917


$
3.29



6.28


$
6,764Exercisable December 31, 2009


1,483,446


$
2.11



5.33


$
6,319    110




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##### Table of Contents



CORNERSTONE
    THERAPEUTICS INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    OutstandingWeighted-





ExercisableAverage


Weighted-





Weighted-Contractual Life


Average





AverageNumber of Options


Outstanding


Exercise


Options


ExerciseExercise Price

Outstanding


(In Years)


Price


Exercisable


Price$0.43-$1.06


418,991



3.57


$
0.47



418,991


$
0.47$1.77


828,997



5.67


$
1.77



767,692


$
1.77$2.02-$3.90


324,668



8.15


$
3.55



259,918


$
3.66$6.20-$9.30


458,716



8.83


$
7.88



22,283


$
8.33$10.50-$26.00


10,372



4.59


$
11.87



9,677


$
11.43$26.00-$70.50


4,920



5.34


$
67.33



4,885


$
67.532,046,664



6.34


$
3.36



1,483,446


$
2.11   Restricted
    Stock
        Weighted-AverageNumber of


Grant DateShares


Fair ValueUnvested  January 1, 2009


475,355


$
4.01Granted


230,000



6.38Vested


(433,367
)


4.11Forfeited


(59,488
)


4.14Unvested  December 31, 2009


212,500


$
6.32    111




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##### Table of Contents



CORNERSTONE
    THERAPEUTICS INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Stock-Based
    Compensation Expense
    For the Year Ended December 31,2009


2008


2007Employee

$
3,227


$
728


$
290Non-employee


64



21



3Total

$
3,291


$
749


$
293     For the Year Ended December 31,2009


2008


2007General and administrative

$
2,673


$
614


$
225Sales and marketing


618



135



68Total

$
3,291


$
749


$
293     NOTE 10:
    EMPLOYEE
    BENEFIT PLANS      NOTE 11:
    COMMITMENTS
    AND CONTINGENCIES  Lease
    Obligations
   112




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##### Table of Contents



CORNERSTONE
    THERAPEUTICS INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      OperatingYear Ending

Leases2010

$
7662011


5212012


5202013


5362014


584Thereafter


751Total minimum lease payments

$
3,678   Supply
    Agreements
    Royalty
    Agreements
    Collaboration
    Agreements
  and/or
 113




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##### Table of Contents



CORNERSTONE
    THERAPEUTICS INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Co-Promotion
    and Marketing Services Agreements
      Severance
    Settlements
  Legal
    Proceedings
   114




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##### Table of Contents



CORNERSTONE
    THERAPEUTICS INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   NOTE 12:
    INCOME
    TAXES    2009


2008


2007Current:Federal

$
8,400


$
3,161


$
62State


779



563



68Total


9,179



3,724



130Deferred:Federal


(3,164
)


(2,930
)


State


(468
)


(380
)


Total


(3,632
)


(3,310
)


Total tax provision

$
5,547


$
414


$
130     2009


2008Current:Deferred tax assets:Accounts receivable, net

$
144


$
116Inventories, net


1,171



400Accrued expenses


3,173



2,542Total current deferred tax assets


4,488



3,058Deferred tax liabilities:Acquired intellectual property


(981
)


(630
)Net current deferred tax assets

$
3,507


$
2,428Noncurrent:Deferred tax assets:Tax loss carryforwards

$
61,610


$
61,888Tax credits


1,900



1,900Stock-based compensation


935



293Product license rights, net


1,557



315Valuation allowance


(63,510
)


(63,788
)Total noncurrent deferred tax assets


2,492



608Deferred tax liabilities:Acquired intellectual property


(6,868
)


(3,783
)Property and equipment, net


(188
)


(155
)Total noncurrent deferred tax liabilities


(7,056
)


(3,938
)Net deferred tax liability  noncurrent


(4,564
)


(3,330
)Total net deferred tax liability

$
(1,057
)

$
(902
)  115




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##### Table of Contents



CORNERSTONE
    THERAPEUTICS INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
          2009


2008


2007Federal statutory taxes


35.0
%


34.0
%


34.0
%State income taxes, net of federal benefit


2.3



4.4



4.3Permanent differences


2.6



4.3



33.9Acquired in-process research and development






7.7



Other


(2.9
)


(1.0
)


(4.6
)Change in valuation allowance


(1.8
)


(45.0
)


(49.0
)35.2
%


4.4
%


18.6
%      116




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##### Table of Contents



CORNERSTONE
    THERAPEUTICS INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      NOTE 13:
    RELATED
    PARTY TRANSACTIONS  Stockholders
      Other
    Related Parties
       117




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##### Table of Contents



CORNERSTONE
    THERAPEUTICS INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    ® ®
  NOTE 14:
    NET
    INCOME PER SHARE      Year Ended December 31,2009


2008


2007Numerator:Net income

$
10,203


$
8,993


$
570Denominator:Weighted-average common shares, basic


17,651,668



6,951,896



5,934,496Dilutive effect of stock options, warrants and restricted stock


1,124,920



909,223



816,631Weighted-average common shares, diluted


18,776,588



7,861,119



6,751,127Net income per share, basic

$
0.58


$
1.29


$
0.10Net income per share, diluted

$
0.54


$
1.14


$
0.08Anti-dilutive weighted-average shares


1,136,792



94,244



   NOTE 15:
    SUBSEQUENT
    EVENTS    NOTE 16:
    RECENT
    ACCOUNTING PRONOUNCEMENTS   118




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##### Table of Contents



CORNERSTONE
    THERAPEUTICS INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   NOTE 17:
    QUARTERLY
    RESULTS OF OPERATIONS (UNAUDITED)    First


Second


Third


FourthQuarter


Quarter


Quarter


Quarter


Total2009Net revenues

$
30,705


$
24,993


$
23,078


$
30,788


$
109,564Gross profit


27,504



22,092



18,935



21,576



90,107Income (loss) from operations


10,359



3,087



(1,042
)


3,474



15,878Net income (loss)


6,315



1,738



(538
)


2,688



10,203Net income (loss) per share, basic


0.53



0.14



(0.03
)


0.11



0.58Net income (loss) per share, diluted


0.48



0.13



(0.03
)


0.10



0.542008Net revenues

$
9,445


$
14,067


$
20,591


$
20,764


$
64,867Gross profit


8,880



13,134



18,987



17,915



58,916Income (loss) from operations


1,367



3,018



6,383



(140
)


10,628Net income


669



2,155



3,307



2,862



8,993Net income per share, basic


0.11



0.36



0.56



0.29



1.29Net income per share, diluted


0.10



0.31



0.48



0.26



1.14    119




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##### Table of Contents



CORNERSTONE
    THERAPEUTICS INC.
  SCHEDULE II 
    VALUATION AND QUALIFYING ACCOUNTS
 (In
    thousands)
  AdditionsCharged to


Charged toBeginning


Costs and


Other





EndingBalance


Expenses


Accounts(1)


Deductions


BalanceYear Ended December 31, 2009Reserves:Allowance for product returns

$
5,043


$



$
15,417
(2)

$
9,498


$
10,962Allowance for rebates


884







1,407



1,278



1,013Allowance for price adjustments and chargebacks


4,307







21,838



22,642



3,503Deducted from asset accounts:Allowance for prompt payment discounts


302







3,157



3,075



384Inventory allowance


677



1,474



234
(6)


583



1,802Year Ended December 31, 2008Reserves:Allowance for product returns

$
4,913


$



$
7,277
(3)

$
7,147


$
5,043Allowance for rebates


303







1,661
(4)


1,080



884Allowance for price adjustments and chargebacks


828







9,054
(5)


5,575



4,307Deducted from asset accounts:Allowance for prompt payment discounts


81







1,887



1,666



302Inventory allowance


201



599







123



677Year Ended December 31, 2007Reserves:Allowance for product returns

$
5,781


$



$
2,879


$
3,747


$
4,913Allowance for rebates


140







228



65



303Allowance for price adjustments and chargebacks


687







1,259



1,118



828Deducted from asset accounts:Allowance for prompt payment discounts


43







645



607



81Inventory allowance


100



169







68



201     (1)
    
    All activity is netted against gross product sales unless
    otherwise stated.(2)
    
    Includes a provision of $4,231 relating to sales made in prior
    periods and $2,455 which was recorded in connection with the
    acquisition of FACTIVE product rights.(3)
    
    Includes a provision of $1,401 relating to sales made in prior
    periods and a provision of $353 that was acquired in the Merger.(4)
    
    Includes a provision of $51 that was acquired in the Merger.(5)
    
    Includes a provision of $133 that was acquired in the Merger.(6)
    
    Represents an allowance of $234 recorded in connection with the
    Companys acquisition of FACTIVE product rights and related
    inventory. 120




---



##### Table of Contents



ITEM 9.
    CHANGES
    IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
    FINANCIAL DISCLOSURE    ITEM 9A.
    CONTROLS
    AND PROCEDURES  Conclusion
    Regarding the Effectiveness of Disclosure Controls and
    Procedures
  Rule 13a-15(b)
  Changes
    in Internal Control Over Financial Reporting
  Form 10-K
  Rules 13a-15(f) 15d-15(f)
  Managements
    Report on Internal Control Over Financial Reporting
  Rule 13a-15(f).
 121




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##### Table of Contents



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
     Internal Control  Integrated Fram
        Internal Control  Integrated
    Framework
         122




---



##### Table of Contents



ITEM 9A(T).
    CONTROLS
    AND PROCEDURES    ITEM 9B.
    OTHER
    INFORMATION   123




---



##### Table of Contents



PART III  ITEM 10.
    DIRECTORS,
    EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE  Directors
    and Executive Officers
  Form 10-K.
  Compliance
    With Section 16(a) of the Exchange Act
    Code of
    Ethics
  Form 8-K,
  Director
    Nominees
    Audit
    Committee
    Audit
    Committee Financial Expert
  Regulation S-K
  ITEM 11.
    EXECUTIVE
    COMPENSATION   124




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##### Table of Contents



ITEM 12.
    SECURITY
    OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
    RELATED STOCKHOLDER MATTERS    ITEM 13.
    CERTAIN
    RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
    INDEPENDENCE    ITEM 14.
    PRINCIPAL
    ACCOUNTANT FEES AND SERVICES   PART IV  ITEM 15.
    EXHIBITS AND
    FINANCIAL STATEMENT SCHEDULES  Financial Statements.
  Form 10-K.
  Financial Statement Schedules
  Form 10-K.
  Exhibits.
  Form 10-K
 125




---



##### Table of Contents



SIGNATURES      By:
    /s/  CRAIG
    A. COLLARD            Signature

Title

Date/s/  CRAIG
    A. COLLARDCraig
    A. Collard

President, Chief Executive Officer and Director (Principal
    Executive Officer)

March 4, 2010/s/  DAVID
    PRICEDavid
    Price

Executive Vice President,
    Finance, and
    Chief Financial Officer
    (Principal Financial Officer and
    Principal Accounting Officer)

March 4, 2010/s/  ALESSANDRO
    CHIESIAlessandro
    Chiesi

Director

March 4, 2010/s/  MARIA
    PAOLA CHIESIMaria
    Paola Chiesi

Director

March 4, 2010/s/  CHRISTOPHER
    CODEANNEChristopher
    Codeanne

Director

March 4, 2010/s/  MICHAEL
    ENRIGHTMichael
    Enright

Director

March 4, 2010/s/  ANTON
    GIORGIO FAILLAAnton
    Giorgio Failla

Director

March 4, 2010/s/  MICHAEL
    HEFFERNANMichael
    Heffernan

Director

March 4, 2010/s/  ROBERT
    STEPHANRobert
    Stephan

Director

March 4, 2010  126




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##### Table of Contents



Exhibit Index  Exhibit No

Description2
.1*

Agreement and Plan of Merger among the Registrant, Neptune
    Acquisition Corp. and Cornerstone BioPharma Holdings, Inc. dated
    May 1, 2008 (incorporated by reference to Exhibit 2.1
    to the Registrants Current Report on
    Form 8-K
    dated May 1, 2008).2
.2

Amendment No. 1, dated August 7, 2008, to Agreement
    and Plan of Merger among the Registrant, Neptune Acquisition
    Corp. and Cornerstone BioPharma Holdings, Inc. dated May 1,
    2008 (incorporated by reference to Exhibit 2.2 to the
    Registrants Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 2008).2
.3

Form of Merger Partner Stockholder Agreement among the
    Registrant, Cornerstone BioPharma Holdings, Inc. and certain
    stockholders of Cornerstone BioPharma Holdings, Inc. (included
    in Exhibit 2.1 hereto).2
.4

Merger Partner Noteholder Agreement among the Registrant,
    Cornerstone BioPharma Holdings, Inc., Cornerstone BioPharma,
    Inc. and Carolina Pharmaceuticals Ltd. dated May 1, 2008
    (incorporated by reference to Exhibit 2.4 to the
    Registrants Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 2008).2
.5

Amendment No. 1, dated August 7, 2008, to Merger
    Partner Noteholder Agreement among the Registrant, Cornerstone
    BioPharma Holdings, Inc., Cornerstone BioPharma, Inc. and
    Carolina Pharmaceuticals Ltd. dated May 1, 2008
    (incorporated by reference to Exhibit 2.5 to the
    Registrants Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 2008).2
.6

Form of Public Company Stockholder Agreement among Cornerstone
    BioPharma Holdings, Inc., the Registrant and certain
    stockholders of the Registrant (included in Exhibit 2.1
    hereto).3
.1

Amended and Restated Certificate of Incorporation of the
    Registrant (incorporated by reference to Exhibit 3.1 to the
    Registrants Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 2004).3
.2

Amendment to the Registrants Certificate of Incorporation,
    effecting a 10-to-1 reverse stock split of the Registrants
    common stock (incorporated by reference to Exhibit 3.1 to
    the Registrants Current Report on
    Form 8-K
    dated October 30, 2008).3
.3

Amendment to the Registrants Certificate of Incorporation,
    changing the name of the corporation from Critical Therapeutics,
    Inc. to Cornerstone Therapeutics Inc. (incorporated by reference
    to Exhibit 3.2 to the Registrants Current Report on
    Form 8-K
    dated October 30, 2008).3
.4

Amendment to the Registrants Certificate of Incorporation,
    effecting certain changes pursuant to the Governance Agreement
    among Chiesi Farmaceutici S.p.A., the Registrant and certain
    other stockholders of the Registrant dated May 6, 2009
    (incorporated by reference to Exhibit 3.1 to the
    Registrants Current Report on
    Form 8-K
    dated August 27, 2009).3
.5

Fourth Amended and Restated Bylaws of the Registrant dated
    July 28, 2009 (incorporated by reference to
    Exhibit 3.1 to the Registrants Current Report on
    Form 8-K
    dated July 27, 2009).4
.1

Form of the Registrants Stock Certificate (incorporated by
    reference to Exhibit 4.1 to the Registrants Current
    Report on
    Form 8-K
    dated October 30, 2008).10
.1+

Co-Promotion and Marketing Services Agreement between the
    Registrant and Dey, L.P. dated March 13, 2007 (incorporated
    by reference to Exhibit 10.2 to the Registrants
    Quarterly Report on
    Form 10-Q
    for the quarter ended March 31, 2007).10
.2+

Amendment No. 1, dated June 25, 2007, to Co-Promotion
    and Marketing Services Agreement between the Registrant and Dey,
    L.P. dated March 13, 2007 (incorporated by reference to
    Exhibit 10.5 to the Registrants Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 2007).10
.3+

Amendment No. 2, dated May 4, 2009, to Co-Promotion
    and Marketing Services Agreement between the Registrant and Dey,
    L.P. dated March 13, 2007 (incorporated by reference to
    Exhibit 10.1 to the Registrants Quarterly Report on
    Form 10-Q
    for the quarter ended March 31, 2009).10
.4+

License and Supply Agreement between Meiji Seika Kaisha, Ltd.
    and Cornerstone BioPharma, Inc. dated October 12, 2006
    (incorporated by reference to Exhibit 10.6 to the
    Registrants Current Report on
    Form 8-K
    dated October 30, 2008).




---



##### Table of Contents



Exhibit No

Description10
.5

Amendment No. 1, dated July 27, 2007, to License and
    Supply Agreement between Meiji Seika Kaisha, Ltd. and
    Cornerstone BioPharma, Inc. dated October 12, 2006
    (incorporated by reference to Exhibit 10.7 to the
    Registrants Current Report on
    Form 8-K
    dated October 30, 2008).10
.6+

Letter Agreement between Meiji Seika Kaisha, Ltd. and
    Cornerstone BioPharma, Inc. dated July 27, 2007
    (incorporated by reference to Exhibit 10.8 to the
    Registrants Current Report on
    Form 8-K
    dated October 30, 2008).10
.7+

Formulation Agreement between Meiji Seika Kaisha, Ltd. and
    Cornerstone BioPharma, Inc. dated January 11, 2008
    (incorporated by reference to Exhibit 10.9 to the
    Registrants Current Report on
    Form 8-K
    dated October 30, 2008).10
.8+

Addendum, dated August 14, 2008, to License and Supply
    Agreement between Meiji Seika Kaisha, Ltd. and Cornerstone
    BioPharma, Inc. dated October 12, 2006 (incorporated by
    reference to Exhibit 10.10 to the Registrants Current
    Report on
    Form 8-K
    dated October 30, 2008).10
.9+

Joint Development Agreement between Meiji Seika Kaisha, Ltd. and
    Cornerstone BioPharma, Inc. dated February 11, 2008
    (incorporated by reference to Exhibit 10.11 to the
    Registrants Current Report on
    Form 8-K
    dated October 30, 2008).10
.10+

Agreement for Manufacturing and Supply of Zileuton between
    Shasun Pharma Solutions Limited (formerly known as Rhodia Pharma
    Solutions Ltd.) and the Registrant dated February 8, 2005
    (incorporated by reference to Exhibit 10.41 to the
    Registrants Annual Report on
    Form 10-K
    for the year ended December 31, 2004).10
.11+

Amendment No. 1, dated May 9, 2007, to Agreement for
    Manufacturing and Supply of Zileuton, between Shasun Pharma
    Solutions Limited (formerly known as Rhodia Pharma Solutions
    Ltd.) and the Registrant dated February 8, 2005
    (incorporated by reference to Exhibit 10.4 to the
    Registrants Quarterly Report on
    Form 10-Q
    for the period ended March 31, 2007).10
.12+

Manufacturing and Supply Agreement among the Registrant, Jagotec
    AG and SkyePharma PLC dated August 20, 2007 (incorporated
    by reference to Exhibit 10.1 to the Registrants
    Quarterly Report on
    Form 10-Q
    for the quarter ended September 30, 2007).10
.13+

Letter Amendment, dated June 12, 2009, to Manufacturing and
    Supply Agreement among the Registrant, Jagotec AG and SkyePharma
    PLC dated August 20, 2007 (incorporated by reference to
    Exhibit 10.1 to the Registrants Current Report on
    Form 8-K
    dated June 12, 2009).10
.14+

Manufacturing Services Agreement between Patheon Pharmaceuticals
    Inc. and the Registrant dated May 9, 2007 (incorporated by
    reference to Exhibit 10.5 to the Registrants
    Quarterly Report on
    Form 10-Q
    for the period ended March 31, 2007).10
.15+

First Amendment, dated November 5, 2007, to Manufacturing
    Services Agreement between Patheon Pharmaceuticals Inc. and the
    Registrant dated May 9, 2007 (incorporated by reference to
    Exhibit 10.2 to the Registrants Quarterly Report on
    Form 10-Q
    for the quarter ended September 30, 2007).10
.16+

Agreement between Patheon, Inc. (formerly known as MOVA
    Pharmaceutical Corporation) and Cornerstone BioPharma, Inc.
    dated August 8, 2007 (incorporated by reference to
    Exhibit 10.1 to the Registrants Current Report on
    Form 8-K
    dated October 30, 2008).10
.17+

Change of Scope Agreement between Patheon, Inc. (formerly known
    as MOVA Pharmaceutical Corporation) and Cornerstone BioPharma,
    Inc. dated November 20, 2007 (incorporated by reference to
    Exhibit 10.2 to the Registrants Current Report on
    Form 8-K
    dated October 30, 2008).10
.18+

License Agreement between the Registrant and Abbott Laboratories
    dated December 18, 2003 (incorporated by reference to
    Exhibit 10.10 to the Registrants Registration
    Statement on
    Form S-1
    (SEC File
    No. 333-113727)).10
.19

Amendment No. 1, dated April 13, 2005, to License
    Agreement between the Registrant and Abbott Laboratories dated
    December 18, 2003 (incorporated by reference to
    Exhibit 10.14 to the Registrants Annual Report on
    Form 10-K
    for the year ended December 31, 2006).10
.20+

License Agreement between the Registrant and Abbott Laboratories
    dated March 19, 2004 (incorporated by reference to
    Exhibit 10.11 to the Registrants Registration
    Statement on
    Form S-1
    (SEC File
    No. 333-113727)).10
.21

Amendment No. 1, dated September 15, 2004, to License
    Agreement between the Registrant and Abbott Laboratories dated
    March 19, 2004 (incorporated by reference to
    Exhibit 10.16 to the Registrants Annual Report on
    Form 10-K
    for the year ended December 31, 2006).




---



##### Table of Contents



Exhibit No

Description10
.22+

Agreement between the Registrant and Jagotec AG dated
    December 3, 2003 (incorporated by reference to
    Exhibit 10.13 to the Registrants Registration
    Statement on
    Form S-1
    (SEC File
    No. 333-113727)).10
.23+

Development and
    Scale-Up
    Agreement between the Registrant and Jagotec AG dated
    May 5, 2004 (incorporated by reference to
    Exhibit 10.25 to Amendment No. 2 to the
    Registrants Registration Statement on
    Form S-1
    (SEC File
    No. 333-113727)).10
.24+

Patent License Agreement between Pharmaceutical Innovations, LLC
    and Cornerstone BioPharma, Inc. effective August 31, 2006
    (incorporated by reference to Exhibit 10.12 to the
    Registrants Current Report on
    Form 8-K
    dated October 30, 2008).10
.25+

Amendment No. 1, dated August 10, 2007, to Patent
    License Agreement between Pharmaceutical Innovations, LLC and
    Cornerstone BioPharma, Inc. effective August 31, 2006
    (incorporated by reference to Exhibit 10.13 to the
    Registrants Current Report on
    Form 8-K
    dated October 30, 2008).10
.26

Amendment No. 2, dated February 15, 2008, to Patent
    License Agreement between Pharmaceutical Innovations, LLC and
    Cornerstone BioPharma, Inc. effective August 31, 2006
    (incorporated by reference to Exhibit 10.14 to the
    Registrants Current Report on
    Form 8-K
    dated October 30, 2008).10
.27+

Development, License and Services Agreement between Neos
    Therapeutics, L.P. and Cornerstone BioPharma, Inc. dated
    March 19, 2008 (incorporated by reference to
    Exhibit 10.15 to the Registrants Current Report on
    Form 8-K
    dated October 30, 2008).10
.28+

Development and Manufacturing Agreement among Neos Therapeutics,
    L.P., Coating Place, Inc. and Cornerstone BioPharma, Inc. dated
    February 27, 2008 (incorporated by reference to
    Exhibit 10.16 to the Registrants Current Report on
    Form 8-K
    dated October 30, 2008).10
.29+

Amendment No. 1, dated June 16, 2009, to Development
    and Manufacturing Agreement among Neos Therapeutics, L.P.,
    Coating Place, Inc. and Cornerstone BioPharma, Inc. dated
    February 27, 2008 (incorporated by reference to
    Exhibit 10.1 to the Registrants Current Report on
    Form 8-K
    dated June 16, 2009).10
.30+

Amended and Restated Products Development Agreement between Neos
    Therapeutics, L.P. and Cornerstone BioPharma, Inc. dated
    August 27, 2008 (incorporated by reference to
    Exhibit 10.17 to the Registrants Current Report on
    Form 8-K
    dated October 30, 2008).10
.31+

Supply and Marketing Agreement between Sovereign
    Pharmaceuticals, Ltd. and Aristos Pharmaceuticals, Inc. dated
    May 1, 2008 (incorporated by reference to
    Exhibit 10.18 to the Registrants Current Report on
    Form 8-K
    dated October 30, 2008).10
.32+

Amendment No. 1, dated December 18, 2009, to Supply
    and Marketing Agreement between Sovereign Pharmaceuticals, Ltd.
    and Aristos Pharmaceuticals, Inc. dated May 1, 2008.10
.33+

License Agreement between the Registrant and The Feinstein
    Institute for Medical Research (formerly known as The North
    Shore-Long Island Jewish Research Institute) dated July 1,
    2001, as amended by the First Amendment Agreement dated
    May 15, 2003 (incorporated by reference to
    Exhibit 10.5 to the Registrants Registration
    Statement on
    Form S-1
    (SEC File
    No. 333-113727)).10
.34+

Sponsored Research and License Agreement between the Registrant
    and The Feinstein Institute for Medical Research (formerly known
    as The North Shore-Long Island Jewish Research Institute) dated
    July 1, 2001, as amended by the First Amendment Agreement
    dated July 1, 2003 (incorporated by reference to
    Exhibit 10.6 to the Registrants Registration
    Statement on
    Form S-1
    (SEC File
    No. 333-113727)).10
.35+

Sponsored Research and License Agreement between the Registrant
    and The Feinstein Institute for Medical Research (formerly known
    as The North Shore-Long Island Jewish Research Institute)
    effective January 1, 2003 (incorporated by reference to
    Exhibit 10.7 to the Registrants Registration
    Statement on
    Form S-1
    (SEC File
    No. 333-113727)).10
.36+

Amendment No. 2, dated January 8, 2007, to Sponsored
    Research and License Agreement between the Registrant and The
    Feinstein Institute for Medical Research (formerly known as The
    North Shore-Long Island Jewish Research Institute) effective
    January 1, 2003 (incorporated by reference to
    Exhibit 10.8 to the Registrants Annual Report on
    Form 10-K
    for the year ended December 31, 2006).




---



##### Table of Contents



Exhibit No

Description10
.37+

Amendment No. 3, dated June 29, 2007, to Sponsored
    Research and License Agreement between the Registrant and The
    Feinstein Institute for Medical Research (formerly known as The
    North Shore-Long Island Jewish Research Institute) effective
    January 1, 2003. (incorporated by reference to
    Exhibit 10.7 to the Registrants Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 2007).10
.38+

Exclusive License and Collaboration Agreement between the
    Registrant and MedImmune, Inc. dated July 30, 2003
    (incorporated by reference to Exhibit 10.8 to the
    Registrants Registration Statement on
    Form S-1
    (SEC File
    No. 333-113727)).10
.39

Amendment No. 1, dated December 7, 2005, to Exclusive
    License and Collaboration Agreement between the Registrant and
    MedImmune, Inc. dated July 30, 2003 (incorporated by
    reference to Exhibit 10.50 to the Registrants Annual
    Report on
    Form 10-K
    for the year ended December 31, 2005).10
.40+

License Agreement between the Registrant and Beckman Coulter,
    Inc. dated January 10, 2005 (incorporated by reference to
    Exhibit 10.1 to the Registrants Quarterly Report on
    Form 10-Q
    for the quarter ended March 31, 2005).10
.41+

Exclusive License Agreement between the Registrant and SetPoint
    Medical Corp. (formerly known as Innovative Metabolics, Inc.)
    dated January 29, 2007 (incorporated by reference to
    Exhibit 99.1 to the Registrants Current Report on
    Form 8-K
    dated January 29, 2007).10
.42+

First Amendment, dated June 29, 2007, to Exclusive License
    Agreement between the Registrant and SetPoint Medical Corp.
    (formerly known as Innovative Metabolics, Inc.) dated
    January 29, 2007 (incorporated by reference to
    Exhibit 10.6 to the Registrants Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 2007).10
.43

Stock Purchase Agreement between Chiesi Farmaceutici S.p.A. and
    the Registrant dated May 6, 2009 (incorporated by reference
    to Exhibit 10.1 to the Registrants Current Report on
    Form 8-K
    dated May 6, 2009; Exhibits A, B, C, D and E thereto
    incorporated by reference to
    Exhibits 10.9-10.14,
    10.4, 10.3, 10.5 and 10.6, respectively, to the
    Registrants Current Report on
    Form 8-K
    dated May 6, 2009; and Exhibit H thereto incorporated
    by reference to Exhibit 10.2 to the Registrants
    Amendment No. 1 on
    Form 8-K/A
    to Current Report on
    Form 8-K
    dated May 6, 2009).10
.44+

License and Distribution Agreement between Chiesi Farmaceutici
    S.p.A. and the Registrant dated May 6, 2009 (incorporated
    by reference to Exhibit 10.2 to the Registrants
    Amendment No. 1 on
    Form 8-K/A
    to Current Report on
    Form 8-K
    dated May 6, 2009).10
.45

Governance Agreement among the Registrant, Chiesi Farmaceutici
    S.p.A. and, solely with respect to the sections identified
    therein, Cornerstone Biopharma Holdings, Ltd., Carolina
    Pharmaceuticals Ltd. and Lutz Family Limited Partnership dated
    May 6, 2009 (incorporated by reference to Exhibit 10.3
    to the Registrants Current Report on
    Form 8-K
    dated May 6, 2009).10
.46

Stockholders Agreement among the Registrant, Chiesi Farmaceutici
    S.p.A., Craig A. Collard, Steven M. Lutz, Cornerstone Biopharma
    Holdings, Ltd., Carolina Pharmaceuticals Ltd. and Lutz Family
    Limited Partnership dated May 6, 2009 (incorporated by
    reference to Exhibit 10.4 to the Registrants Current
    Report on
    Form 8-K
    dated May 6, 2009).10
.47

Amendment, dated June 26, 2009, to Stockholders Agreement
    among the Registrant, Chiesi Farmaceutici S.p.A., Craig A.
    Collard, Steven M. Lutz, Cornerstone Biopharma Holdings, Ltd.,
    Carolina Pharmaceuticals Ltd. and Lutz Family Limited
    Partnership dated May 6, 2009 (incorporated by reference to
    Exhibit 10.2 to the Registrants Current Report on
    Form 8-K
    dated June 26, 2009).10
.48

Registration Rights Agreement between the Registrant and Chiesi
    Farmaceutici S.p.A. dated May 6, 2009 (incorporated by
    reference to Exhibit 10.5 to the Registrants Current
    Report on
    Form 8-K
    dated May 6, 2009).10
.49

Registration Rights Agreement among the Registrant, Craig A.
    Collard, Steven M. Lutz, Cornerstone Biopharma Holdings, Ltd.,
    Carolina Pharmaceuticals Ltd. and Lutz Family Limited
    Partnership dated May 6, 2009 (incorporated by reference to
    Exhibit 10.6 to the Registrants Current Report on
    Form 8-K
    dated May 6, 2009).10
.50

Voting Agreement between the Registrant and Chiesi Farmaceutici
    S.p.A. dated May 6, 2009 (incorporated by reference to
    Exhibit 10.7 to the Registrants Current Report on
    Form 8-K
    dated May 6, 2009).




---



##### Table of Contents



Exhibit No

Description10
.51

Voting Agreement among Chiesi Farmaceutici S.p.A., Craig A.
    Collard, Steven M. Lutz, Cornerstone Biopharma Holdings, Ltd.,
    Carolina Pharmaceuticals Ltd., Lutz Family Limited Partnership,
    Brian Dickson, Joshua B. Franklin, David Price, Alan Roberts
    and, solely with respect to Section 2(b) thereof, the
    Registrant dated May 6, 2009 (incorporated by reference to
    Exhibit 10.8 to the Registrants Current Report on
    Form 8-K
    dated May 6, 2009).10
.52

Asset Purchase Agreement between Oscient Pharmaceuticals
    Corporation and Cornerstone BioPharma, Inc. dated July 13,
    2009 (incorporated by reference to Exhibit 10.1 to the
    Registrants Current Report on
    Form 8-K
    dated July 13, 2009).10
.53+

License and Option Agreement between LG Life Sciences, Ltd. and
    Cornerstone BioPharma, Inc. (as assignee of Oscient
    Pharmaceuticals Corporation) dated October 22, 2002, as
    amended by Amendment No. 1 dated November 21, 2002,
    Amendment No. 2 dated December 6, 2002, Amendment
    No. 3 dated October 16, 2003, Amendment No. 4
    dated March 31, 2005, Amendment No. 5 dated
    February 3, 2006, Amendment No. 6 dated
    February 3, 2006 and Amendment No. 7 dated
    December 27, 2006 (incorporated by reference to
    Exhibit 10.2 to the Registrants Quarterly Report on
    Form 10-Q
    for the quarter ended September 30, 2009).10
.54

Commercial Note issued by Cornerstone BioPharma Holdings, Inc.
    to Paragon Commercial Bank dated April 21, 2005
    (incorporated by reference to Exhibit 10.41 to the
    Registrants Current Report on
    Form 8-K
    dated October 30, 2008).10
.55

Security Agreement by Cornerstone BioPharma Holdings, Inc. in
    favor of Paragon Commercial Bank dated April 21, 2005
    (incorporated by reference to Exhibit 10.42 to the
    Registrants Current Report on
    Form 8-K
    dated October 30, 2008).10
.56

Modification Agreement among Paragon Commercial Bank,
    Cornerstone BioPharma Holdings, Inc., Charles W. Cleary (as
    trustee), Carolina Pharmaceuticals, Inc. (as guarantor) and
    Craig A. Collard (as guarantor) dated April 10, 2006
    (incorporated by reference to Exhibit 10.43 to the
    Registrants Current Report on
    Form 8-K
    dated October 30, 2008).10
.57

Modification Agreement among Paragon Commercial Bank,
    Cornerstone BioPharma Holdings, Inc., Charles W. Cleary (as
    trustee), Carolina Pharmaceuticals, Inc. (as guarantor) and
    Craig A. Collard (as guarantor) dated July 31, 2007
    (incorporated by reference to Exhibit 10.44 to the
    Registrants Current Report on
    Form 8-K
    dated October 30, 2008).10
.58

Letter Agreement among Paragon Commercial Bank, Cornerstone
    BioPharma Holdings, Inc., Craig A. Collard (as guarantor),
    Aristos Pharmaceuticals, Inc. (as guarantor) and Cornerstone
    BioPharma, Inc. (as guarantor) dated June 23, 2008
    (incorporated by reference to Exhibit 10.45 to the
    Registrants Current Report on
    Form 8-K
    dated October 30, 2008).10
.59

Modification Agreement among Paragon Commercial Bank,
    Cornerstone BioPharma Holdings, Inc., John S. Towles (as
    trustee), Craig A. Collard (as guarantor), Aristos
    Pharmaceuticals, Inc. (as guarantor) and Cornerstone BioPharma,
    Inc. (as guarantor) dated June 25, 2008 (incorporated by
    reference to Exhibit 10.46 to the Registrants Current
    Report on
    Form 8-K
    dated October 30, 2008).10
.60

Unconditional Guaranty by Cornerstone BioPharma, Inc. in favor
    of Paragon Commercial Bank dated June 25, 2008
    (incorporated by reference to Exhibit 10.47 to the
    Registrants Current Report on
    Form 8-K
    dated October 30, 2008).10
.61

Security Agreement by Cornerstone BioPharma, Inc. and
    Cornerstone BioPharma Holdings, Inc. in favor of Paragon
    Commercial Bank dated June 25, 2008 (incorporated by
    reference to Exhibit 10.48 to the Registrants Current
    Report on
    Form 8-K
    dated October 30, 2008).10
.62

Unconditional Guaranty by Aristos Pharmaceuticals, Inc. in favor
    of Paragon Commercial Bank dated June 25, 2008
    (incorporated by reference to Exhibit 10.49 to the
    Registrants Current Report on
    Form 8-K
    dated October 30, 2008).10
.63

Security Agreement by Aristos Pharmaceuticals, Inc. and
    Cornerstone BioPharma Holdings, Inc. in favor of Paragon
    Commercial Bank dated June 25, 2008 (incorporated by
    reference to Exhibit 10.50 to the Registrants Current
    Report on
    Form 8-K
    dated October 30, 2008).10
.64

Letter from Paragon Commercial Bank to Cornerstone BioPharma
    Holdings, Inc. dated October 29, 2008 (incorporated by
    reference to Exhibit 10.51 to the Registrants Current
    Report on
    Form 8-K
    dated October 30, 2008).




---



##### Table of Contents



Exhibit No

Description10
.65

Warrant Agreement between the Registrant and Mellon Investor
    Services LLC as Warrant Agent, dated June 20, 2005
    (incorporated by reference to Exhibit 99.1 to the
    Registrants Current Report on
    Form 8-K
    dated June 20, 2005).10
.66

Form of Warrant (Included in Exhibit 10.60 hereto).10
.67

Warrant Agreement between the Registrant and Mellon Investor
    Services LLC dated October 31, 2006 (incorporated by
    reference to Exhibit 10.2 to the Registrants
    Quarterly Report on
    Form 10-Q
    for the period ended September 30, 2006).10
.68

Lease Agreement between Crescent Lakeside, LLC and the
    Registrant (as assignee of Cornerstone BioPharma Holdings, Inc.)
    dated May 1, 2008 (incorporated by reference to
    Exhibit 10.26 to the Registrants Current Report on
    Form 8-K
    dated October 30, 2008).10
.69

Lease Modification Agreement No. 1, dated October 31,
    2008, to Lease Agreement between Crescent Lakeside, LLC and the
    Registrant (as assignee of Cornerstone BioPharma Holdings, Inc.)
    dated May 1, 2008 (incorporated by reference to
    Exhibit 10.3 to the Registrants Quarterly Report on
    Form 10-Q
    for the quarter ended September 30, 2009).10
.70

Lease Modification Agreement No. 2, dated October 2,
    2009, to Lease Agreement between Crescent Lakeside, LLC and the
    Registrant (as assignee of Cornerstone BioPharma Holdings, Inc.)
    dated May 1, 2008 (incorporated by reference to
    Exhibit 10.4 to the Registrants Quarterly Report on
    Form 10-Q
    for the quarter ended September 30, 2009).10
.71#

2004 Stock Incentive Plan of the Registrant (as Amended and
    Restated May 28, 2009) (incorporated by reference to
    Exhibit 10.1 to the Registrants Current Report on
    Form 8-K
    dated May 28, 2009).10
.72#

Form of Incentive Stock Option Agreement granted under the 2004
    Stock Incentive Plan (incorporated by reference to
    Exhibit 10.68 to the Registrants Annual Report on
    Form 10-K
    for the year ended December 31, 2008).10
.73#

Form of Nonstatutory Stock Option Agreement granted under the
    2004 Stock Incentive Plan (incorporated by reference to
    Exhibit 10.70 to the Registrants Annual Report on
    Form 10-K
    for the year ended December 31, 2008).10
.74#

Form of Nonstatutory Stock Option Agreement for a Non-Employee
    Director granted under the 2004 Stock Incentive Plan
    (incorporated by reference to Exhibit 10.72 to the
    Registrants Annual Report on
    Form 10-K
    for the year ended December 31, 2008).10
.75#

Form of Restricted Stock Agreement granted under 2004 Stock
    Incentive Plan.10
.76#

Cornerstone BioPharma Holdings, Inc. 2005 Stock Incentive Plan
    (as Amended and Restated effective October 31, 2008)
    (incorporated by reference to Exhibit 10.37 to the
    Registrants Current Report on
    Form 8-K
    dated October 30, 2008).10
.77#

Form of Nonstatutory Stock Option Agreement granted under the
    Cornerstone BioPharma Holdings, Inc. 2005 Stock Incentive Plan
    (incorporated by reference to Exhibit 10.39 to the
    Registrants Current Report on
    Form 8-K
    dated October 30, 2008).10
.78#

Cornerstone BioPharma Holdings, Inc. 2005 Stock Option Plan (as
    Amended and Restated effective October 31, 2008)
    (incorporated by reference to Exhibit 10.38 to the
    Registrants Current Report on
    Form 8-K
    dated October 30, 2008).10
.79#

Form of Nonstatutory Employee Stock Option Agreement granted
    under the Cornerstone BioPharma Holdings, Inc. 2005 Stock Option
    Plan (incorporated by reference to Exhibit 10.40 to the
    Registrants Current Report on
    Form 8-K
    dated October 30, 2008).10
.80#

Amended and Restated Non-Employee Director Compensation and
    Reimbursement Policy of the Registrant effective
    October 31, 2008 (incorporated by reference to
    Exhibit 10.80 to the Registrants Annual Report on
    Form 10-K
    for the year ended December 31, 2008).10
.81#

Executive Employment Agreement between Cornerstone BioPharma,
    Inc. and Craig A. Collard dated March 1, 2006 (incorporated
    by reference to Exhibit 10.27 to the Registrants
    Current Report on
    Form 8-K
    dated October 30, 2008).10
.82#

Executive Retention Agreement between Cornerstone BioPharma,
    Inc. and Craig A. Collard dated February 8, 2006
    (incorporated by reference to Exhibit 10.28 to the
    Registrants Current Report on
    Form 8-K
    dated October 30, 2008).




---



##### Table of Contents



Exhibit No

Description10
.83#

First Amendment, dated June 18, 2009, to Executive
    Retention Agreement between Cornerstone BioPharma, Inc. and
    Craig A. Collard dated February 8, 2006 (incorporated by
    reference to Exhibit 10.2 to the Registrants Current
    Report on
    Form 8-K
    dated June 12, 2009).10
.84#

Amended and Restated Executive Employment Agreement between the
    Registrant and Craig A. Collard dated May 6, 2009
    (incorporated by reference to Exhibit 10.9 to the
    Registrants Current Report on
    Form 8-K
    dated May 6, 2009).10
.85#

Severance Agreement and General Release between the Registrant
    and Chenyqua Baldwin dated May 7, 2009 (incorporated by
    reference to Exhibit 10.16 to the Registrants
    Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 2009).10
.86#

Executive Employment Agreement between Cornerstone BioPharma,
    Inc. and Brian Dickson dated March 1, 2006 (incorporated by
    reference to Exhibit 10.30 to the Registrants Current
    Report on
    Form 8-K
    dated October 30, 2008).10
.87#

First Amendment, dated June 12, 2009, to Executive
    Employment Agreement between Cornerstone BioPharma, Inc. and
    Brian Dickson dated March 1, 2006 (incorporated by
    reference to Exhibit 10.3 to the Registrants Current
    Report on
    Form 8-K
    dated June 12, 2009).10
.88#

Amended and Restated Executive Employment Agreement between the
    Registrant and Brian Dickson dated May 6, 2009
    (incorporated by reference to Exhibit 10.12 to the
    Registrants Current Report on
    Form 8-K
    dated May 6, 2009).10
.89#

Separation Letter Agreement and General Release between the
    Registrant and Brian Dickson dated October 16, 2009.10
.90#

Letter Agreement between Cornerstone BioPharma, Inc. and Joshua
    B. Franklin dated September 12, 2008 (incorporated by
    reference to Exhibit 10.87 to the Registrants Annual
    Report on
    Form 10-K
    for the year ended December 31, 2008).10
.91#

Agreement Regarding Employment, Employee Duties, Ownership of
    Employee Developments, and Confidentiality between Cornerstone
    BioPharma, Inc. and Joshua B. Franklin dated September 29,
    2008 (incorporated by reference to Exhibit 10.81 to the
    Registrants Annual Report on
    Form 10-K
    for the year ended December 31, 2008).10
.92#

Amended and Restated Executive Employment Agreement between the
    Registrant and Joshua B. Franklin dated May 6, 2009
    (incorporated by reference to Exhibit 10.13 to the
    Registrants Current Report on
    Form 8-K
    dated May 6, 2009).10
.93#

Executive Employment Agreement between Cornerstone BioPharma,
    Inc. and Steven M. Lutz dated March 1, 2006 (incorporated
    by reference to Exhibit 10.32 to the Registrants
    Current Report on
    Form 8-K
    dated October 30, 2008).10
.94#

First Amendment, dated June 12, 2009, to Executive
    Employment Agreement between Cornerstone BioPharma, Inc. and
    Steven M. Lutz dated March 1, 2006 (incorporated by
    reference to Exhibit 10.4 to the Registrants Current
    Report on
    Form 8-K
    dated June 12, 2009).10
.95#

Amended and Restated Executive Employment Agreement between the
    Registrant and Steven M. Lutz dated May 6, 2009
    (incorporated by reference to Exhibit 10.10 to the
    Registrants Current Report on
    Form 8-K
    dated May 6, 2009).10
.96#

Executive Employment Agreement between the Registrant and Andrew
    K. W. Powell dated October 30, 2009.10
.97#

Executive Employment Agreement between Cornerstone BioPharma
    Holdings, Inc. and David Price dated August 20, 2008
    (incorporated by reference to Exhibit 10.33 to the
    Registrants Current Report on
    Form 8-K
    dated October 30, 2008).10
.98#

Amended and Restated Executive Employment Agreement between the
    Registrant and David Price dated May 6, 2009 (incorporated
    by reference to Exhibit 10.11 to the Registrants
    Current Report on
    Form 8-K
    dated May 6, 2009).10
.99#

Amendment No. 1, dated June 26, 2009, to Amended and
    Restated Executive Employment Agreement, between the Registrant
    and David Price dated May 6, 2009 (incorporated by
    reference to Exhibit 10.4 to the Registrants Current
    Report on
    Form 8-K
    dated June 26, 2009).10
.100#

Amended and Restated Restricted Stock Agreement between
    Cornerstone BioPharma Holdings, Inc. and David Price dated
    October 31, 2008 (incorporated by reference to
    Exhibit 10.34 to the Registrants Current Report on
    Form 8-K
    dated October 30, 2008).




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##### Table of Contents



Exhibit No

Description10
.101#

First Amendment, dated June 12, 2009, to Amended and
    Restated Restricted Stock Agreement between Cornerstone
    BioPharma Holdings, Inc. and David Price dated October 31,
    2008 (incorporated by reference to Exhibit 10.5 to the
    Registrants Current Report on
    Form 8-K
    dated June 12, 2009).10
.102#

Second Amendment, dated July 27, 2009, to Amended and
    Restated Restricted Stock Agreement between Cornerstone
    BioPharma Holdings, Inc. and David Price dated October 31,
    2008 (incorporated by reference to Exhibit 10.5 to the
    Registrants Quarterly Report on
    Form 10-Q
    for the quarter ended September 30, 2009).10
.103#

Executive Employment Agreement between the Registrant and Alan
    Roberts dated May 6, 2009 (incorporated by reference to
    Exhibit 10.14 to the Registrants Current Report on
    Form 8-K
    dated May 6, 2009).10
.104#

Amended and Restated Employment Agreement between the Registrant
    and Scott B. Townsend dated November 6, 2007 (incorporated
    by reference to Exhibit 10.6 to the Registrants
    Quarterly Report on
    Form 10-Q
    for the quarter ended September 30, 2007).10
.105#

First Amendment, dated September 16, 2008, to Amended and
    Restated Employment Agreement between the Registrant and Scott
    B. Townsend dated November 6, 2007 (incorporated by
    reference to Exhibit 10.55 to the Registrants
    Registration Statement on
    Form S-4/A
    dated September 18, 2008 (SEC File
    No. 333-152442)).10
.106#

Restricted Stock Agreement between the Registrant and Scott B.
    Townsend dated September 16, 2008 (incorporated by
    reference to Exhibit 10.93 to the Registrants Annual
    Report on
    Form 10-K
    for the year ended December 31, 2008).10
.107#

Separation Letter Agreement and General Release between the
    Registrant and Scott B. Townsend dated June 5, 2009
    (incorporated by reference to Exhibit 10.25 to the
    Registrants Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 2009).10
.108#

Form of Indemnification Agreement, entered into between
    Cornerstone BioPharma Holdings, Inc. and each of Craig A.
    Collard and certain other directors of Cornerstone BioPharma
    Holdings, Inc. on April 12, 2005 (incorporated by reference
    to Exhibit 10.36 to the Registrants Current Report on
    Form 8-K
    dated October 30, 2008).21
.1

Subsidiaries of the Registrant.23
.1

Consent of Grant Thornton LLP.31
.1

Certification of Principal Executive Officer pursuant to
    Rule 13a-14(a)
    and 15d-14(a) of the Securities Exchange Act of 1934, as adopted
    pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31
.2

Certification of Principal Financial Officer pursuant to
    Rule 13a-14(a)
    and 15d-14(a) of the Securities Exchange Act of 1934, as adopted
    pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32
.1

Certification of Principal Executive Officer pursuant to
    18 U.S.C. Section 1350, as adopted pursuant to
    Section 906 of the Sarbanes-Oxley Act of 2002.32
.2

Certification of Principal Financial Officer pursuant to
    18 U.S.C. Section 1350, as adopted pursuant to
    Section 906 of the Sarbanes-Oxley Act of 2002.     *
    
    Pursuant to
    Regulation S-K,
    Item 601(b)(2), certain schedules to the Agreement and Plan
    of Merger have not been filed herewith. The Registrant agrees to
    furnish supplementally a copy of any such schedule to the
    Securities and Exchange Commission upon request; provided,
    however, that the Registrant may request confidential treatment
    of omitted items.#
    
    Management contract or compensatory plan or arrangement.+
    
    Portions of the exhibit have been omitted pursuant to a request
    for confidential treatment, which portions have been separately
    filed with the Securities and Exchange Commission.