##### Table of Contents



UNITED STATES SECURITIES AND
    EXCHANGE COMMISSION
 Washington, D.C.
    20549
      Form 10-K
  þ

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the Fiscal Year ended
    December 31, 2005Oro

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934   Commission file number
    001-14758
  Questcor Pharmaceuticals,
    Inc.
 (Exact name of registrant as
    specified in its charter)
  California(State or other
    jurisdiction of
    incorporation or organization)

33-0476164(I.R.S. Employer
    Identification No.)3260 Whipple Road
    Union City, California(Address of principal
    executive offices)

94587(Zip
    Code)   Registrants
    telephone number, including area code:(510) 400-0700
  Securities registered pursuant to Section 12(b) of the
    Act:
  Title of Each Class

Name of Each Exchange on Which
    RegisteredCommon Stock, no par
    value

American Stock
    Exchange   Securities registered pursuant to Section 12(g) of the
    Act:
 Common Stock, no par value
 (Title of class)
  o þ
  o þ
  þ o
  Regulation S-K Form 10-K Form 10-K. o
  Rule 12b-2
 o o þ
  Rule 12b-2 o þ
      DOCUMENTS INCORPORATED BY REFERENCE




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##### 



ANNUAL
    REPORT ON
    FORM 10-K
    FOR THE FISCAL YEAR ENDED DECEMBER 31, 2005
   TABLE OF CONTENTS
  
  PagePART IItem 1.

Business


2Item 1A.

Risk Factors


8Item 1B.

Unresolved Staff
    Comments


16Item 2.

Properties


16Item 3.

Legal
    Proceedings


16Item 4.

Submission of
    Matters to a Vote of Security Holders


17PART IIItem 5.

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


17Item 6.

Selected
    Consolidated Financial Data


18Item 7.

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


19Item 7A.

Quantitative and
    Qualitative Disclosures about Market Risk


39Item 8.

Financial
    Statements and Supplementary Data


40Item 9.

Changes in and
    Disagreements with Accountants on Accounting and Financial
    Disclosure


41Item 9A.

Controls and
    Procedures


41Item 9B.

Other
    Information


41PART IIIItem 10.

Directors and
    Executive Officers of the Registrant


41Item 11.

Executive
    Compensation


41Item 12.

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


41Item 13.

Certain
    Relationships and Related Transactions


42Item 14.

Principal
    Accountant Fees and Services


42PART IVItem 15.

Exhibits and
    Financial Statement Schedules


42Signatures


46EXHIBIT 10.41EXHIBIT 10.42EXHIBIT 10.43EXHIBIT 10.44EXHIBIT 23.1EXHBIIT 23.2EXHIBIT 31EXHIBIT 32   1




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##### Table of Contents



PART I  Item 1.
    Business    Overview
  ®
      
    assembled an experienced management team with extensive
    specialty pharmaceutical and CNS experience,
    divested our non-core product lines to provide capital to expand
    our business,
    expanded our sales organization to effectively cover the
    nationwide audience of physicians who are current and potential
    high prescribers of Acthar and other products that treat CNS
    disorders, and
    improved our capital structure by eliminating our outstanding
    debt and Series B Convertible Preferred Stock.    ® ® ®
   2




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® tm
  (510) 400-0700.
  Strategy
      
    Increase sales of Acthar through targeted promotion. We seek to
    increase sales of Acthar by promoting to the nationwide audience
    of physicians who are current and potential high prescribers of
    Acthar through our expanded sales organization.
    License, acquire, or co-promote additional commercial products.
    We seek to license, acquire, or co-promote additional commercial
    products that will (i) benefit from increased marketing
    efforts directed at neurologists and other select healthcare
    providers, (ii) leverage our existing sales infrastructure,
    (iii) complement our therapeutic focus on neurology, and
    (iv) ultimately improve our operating results.
    Develop, acquire, or license new or improved formulations of
    prescription products. We seek to develop, acquire or license
    new or improved formulations of prescription products that will
    (i) complement our target therapeutic area and sales
    strategy (ii) generally be in the later stages of
    development, and (iii) require lower capital investment
    when compared to traditional pre-clinical development programs.    H.P.
    Acthar Gel
   3




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Drug
    Development
     4




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Manufacturing
            Divested
    Product Lines
   5




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##### Table of Contents



Sales and
    Marketing
      Beacon
    Pharmaceuticals, Ltd.
    IDIS
    Limited
    Competition
          Government
    Regulation
  Marketed
    Pharmaceutical Products
     6




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Drugs
    in Development
    Product
    Liability Insurance
  If
    product liability lawsuits are successfully brought against us
    or we become subject to other forms of litigation, we may incur
    substantial liabilities and costs and may be required to limit
    commercialization of our products
  Patents
    and Proprietary Rights
        If we
    are unable to protect our proprietary rights, we may lose our
    competitive position and future revenues
 7




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Employees
    Website
    Address
  www.questcor.com Form 10-K, Form 10-Q, Form 8-K,
  Financial
    Information
    Item 1A.
    Risk
    Factors  We
    have a history of operating losses and may never generate
    sufficient revenue to achieve profitability.
      
    develop, finance and implement an effective promotional strategy
    for Acthar,
    finance and acquire additional commercial products,
    finance operations until consistent positive cash flows are
    achieved,
    continue to receive finished product and API from our
    sole-source contract manufacturers on a timely basis and at
    acceptable costs,
    continue to control our operating expenses, and
    ensure customers compliance with our sales and product
    return policies.    If our
    revenues from sales of Acthar decline or fail to grow, we may
    not have sufficient revenues to fund our
    operations.
     8




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Our
    business will be harmed if we are unable to implement our growth
    strategy successfully.
    
    initially focusing our promotional efforts on Acthar, our CNS
    product,
    acquiring additional commercial products that have sales growth
    potential, are promotionally responsive to a focused and
    targeted sales and marketing effort, complement our therapeutic
    focus on neurology and can be acquired at a reasonable valuation
    relative to our cost of capital, and
    developing new medications focused in CNS with our corporate
    resources and through corporate collaborations.    We
    have little or no control over our wholesalers buying
    patterns, which may impact future revenues, returns and excess
    inventory.
        work-in-process
 9




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Our
    inability to secure additional funding could lead to a loss of
    your investment.
      
    existing product sales performance,
    successfully implementing our growth strategy,
    achieving better operating efficiencies,
    maintaining customer compliance with our policies,
    obtaining product from our sole-source contract
    manufacturers, and
    acquiring or developing additional products.    If we
    are unable to contract with third party contract manufacturers,
    we may be unable to meet the demand for our products and lose
    potential revenues.
      If our
    third party distributors are unable to distribute our product or
    the costs to distribute our product increases substantially, we
    will lose potential revenues and profits.
   10




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##### Table of Contents



We
    have experienced changes in key personnel which will have an
    uncertain impact on future operations.
      Our
    products may not be accepted by the market, which may result in
    lower future revenues as well as a decline in our competitive
    positioning.
      
    the establishment and demonstration of the clinical efficacy and
    safety of the product candidates,
    their potential advantage over alternative treatment methods and
    competing products,
    reimbursement policies of government and third party
    payors, and
    our ability to market and promote the products effectively.    A
    large percentage of our voting stock is beneficially owned by a
    small number of stockholders, who in the future could attempt to
    take control of our management and operations or exercise voting
    power to advance their own best interests and not necessarily
    those of other stockholders.
   11




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If
    competitors develop and market products that are more effective
    than ours, our commercial opportunity will be reduced or
    eliminated.
          
    product efficacy and safety,
    the timing and scope of regulatory approvals,
    availability of resources,
    price, and
    patent position, including potentially dominant patent positions
    of others.   12




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If we
    fail to maintain or enter into new contracts related to
    collaborations and in-licensed or acquired technology and
    products, our product development and commercialization could be
    delayed.
        If we
    are unable to protect our proprietary rights, we may lose our
    competitive position and future revenues.
    
    obtain patents for our products and technologies,
    protect trade secrets,
    operate without infringing upon the proprietary rights of
    others, and
    prevent others from infringing on our proprietary rights.     13




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Since
    we must obtain regulatory approval to market our products in the
    United States and in foreign jurisdictions, we cannot predict
    whether or when we will be permitted to commercialize our
    products.
    
    stall the marketing, selling and distribution of any products
    that our corporate partners or we develop,
    impose significant additional costs on our corporate partners
    and us,
    diminish any competitive advantages that we or our corporate
    partners may attain, and
    decrease our ability to receive royalties and generate revenues
    and profits.      Our
    ability to generate revenues is affected by the availability of
    reimbursement on our product, and our ability to generate
    revenues will be diminished if we fail to obtain an adequate
    level of reimbursement for our product from third party
    payors.
   14




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Our
    business is subject to changing regulation of corporate
    governance and public disclosure that has increased both our
    costs and the risk of noncompliance.
       15




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Our
    stock price has a history of volatility, and an investment in
    our stock could decline in value.
    If
    product liability lawsuits are successfully brought against us
    or we become subject to other forms of litigation, we may incur
    substantial liabilities and costs and may be required to limit
    commercialization of our products.
    Item 1B.
    Unresolved
    Staff Comments.    Item 2.
    Properties        Item 3.
    Legal
    Proceedings   16




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Item 4.
    Submission
    of Matters to a Vote of Security Holders   PART II  Item 5.
    Market
    for Registrants Common Equity and Related Shareholder
    Matters and Issuer Purchases of Equity Securities    Common StockClosing PriceQuarter Ended

High


LowDecember 31, 2005

$
1.23


$
0.44September 30, 2005


0.66



0.45June 30, 2005


0.75



0.54March 31, 2005


0.61



0.42December 31, 2004


0.57



0.40September 30, 2004


0.84



0.38June 30, 2004


0.95



0.77March 31, 2004


1.09



0.70      17




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Item 6.
    Selected
    Consolidated Financial Data    Years Ended
    December 31,2005


2004


2003


2002(1)


2001(In thousands, except per share
    data)Consolidated Statement of
    Operations Data:Net product sales

$
14,162


$
18,404


$
13,655


$
13,819


$
5,196Total revenues


14,162



18,404



14,063



14,677



5,667Total operating costs and expenses


16,351



18,670



17,397



17,080



15,050Loss from operations


(2,189
)


(266
)


(3,334
)


(2,403
)


(9,383
)Gain on sale of product lines


9,642















Net income (loss)


7,392



(832
)


(3,791
)


(2,785
)


(8,697
)Net income (loss) applicable to
    common shareholders


5,068



(1,508
)


(5,947
)


(2,785
)


(8,697
)Net income (loss) per common share
    applicable to common shareholders  basic and
    diluted

$
0.10


$
(0.03
)

$
(0.14
)

$
(0.07
)

$
(0.28
)Shares used in computing net
    income (loss) per common share applicable to common
    shareholders  basic


52,477



50,844



41,884



38,407



31,425Shares used in computing net
    income (loss) per common share applicable to common
    shareholders  diluted


53,323



50,844



41,884



38,407



31,425   December 31,2005


2004


2003


2002


2001(In thousands)Consolidated Balance Sheet Data:Cash, cash equivalents and
    short-term investments (includes $5.0 million compensating
    balance at December 31, 2001)

$
26,577


$
8,729


$
3,220


$
7,506


$
10,571Working capital


16,121



5,082



4,352



7,018



2,659Total assets


31,348



28,173



22,929



12,766



14,946Long-term debt






1,986



3,402



2,908



Preferred stock, Series A


5,081



5,081



5,081



5,081



5,081Preferred stock, Series B(2)


7,841



7,578



8,278







Common stock


90,576



88,436



85,232



77,528



74,018Accumulated deficit


(79,147
)


(84,423
)


(82,915
)


(76,968
)


(74,183
)Total shareholders equity
    (deficit)


11,422



11,581



10,578



496



(300
)     (1)
    
    Effective January 1, 2002, we adopted Statement of
    Financial Accounting Standards (SFAS) No. 141
    Business Combinations and SFAS No. 142,
    Goodwill and Other Intangible Assets.(2)
    
    Series B Convertible Preferred Stock (Series B
    Preferred Stock) is reported at its redemption amount and
    as a current liability as of December 31, 2005. 18




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QUARTERLY
    FINANCIAL INFORMATION (UNAUDITED)
  Quarter Ended12/31/05


09/30/05


06/30/05


03/31/05(In thousands, except per share
    data)Net product sales

$
1,816


$
3,558


$
4,290


$
4,498Cost of product sales


813



522



1,027



748Gain on sale of product lines


9,642











Net income (loss)


7,114



(54
)


179



153Net income (loss) applicable to
    common shareholders


5,368



(222
)


11



(99
)Net income (loss) per share
    applicable to common shareholders  basic and
    diluted


0.10



0.00



0.00



0.00   Quarter Ended12/31/04


09/30/04


06/30/04


03/31/04(In thousands, except per share
    data)Net product sales

$
5,297


$
3,869


$
4,090


$
5,148Cost of product sales


1,070



843



961



856Net income (loss)


511



(1,366
)


(247
)


270Net income (loss) applicable to
    common shareholders


343



(1,534
)


(415
)


98Net income (loss) per share
    applicable to common shareholders  basic and
    diluted


0.01



(0.03
)


(0.01
)


0.00   Item 7.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations      ®
   19




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®
      Critical
    Accounting Policies and Use of Estimates
    Sales
    Reserves
     20




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December 31,2005


2004(In $000s)Balance, beginning of year

$
1,267


$
158Actual returns in current year
    related to sales from prior years


(667
)


(62
)Actual returns in current year
    related to sales from current year






Current provision related to sales
    made in prior years


67



30Current provision related to sales
    made in current year


1,618



1,141Transfer of divested product line
    accruals


(576
)


Balance, end of year

$
1,709


$
1,267  21




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##### Table of Contents



product-by-product
    Inventories
    Intangible
    Assets
   22




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##### Table of Contents



Results
    of Operations
  Year
    Ended December 31, 2005 Compared to the Year Ended
    December 31, 2004
  Total
    Revenues
    Net product sales by therapeutic area:
  Years EndedDecember 31,


Increase/2005


2004


(Decrease)


%(In $000s)Neurology

$
8,425


$
8,168


$
257



3
%Gastroenterology


5,084



9,399



(4,315
)


(46
)%Nephrology


653



837



(184
)


(22
)%Total net product sales

$
14,162


$
18,404


$
(4,242
)


(23
)%     Neurology
    Net Product Sales
       23




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Gastroenterology
    Net Product Sales
      Nephrology
    Net Product Sales
    Cost
    of Product Sales
      Selling,
    General and Administrative
  Years EndedDecember 31,2005


2004


Decrease


%(In $000s)Selling, general and
    administrative expense

$
10,019


$
11,551


$
(1,532
)


(13
)%Percentage of total revenue


71
%


63
%  24




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Research
    and Development
     25




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##### Table of Contents



Depreciation
    and Amortization
    Other
    Income and Expense Items
  Years EndedDecember 31,


Increase/2005


2004


(Decrease)


%(In $000s)Non-cash amortization of deemed
    discount on convertible debentures

$
(108
)

$
(522
)

$
414



79
%Interest income


271



78



193



247
%Interest expense


(275
)


(420
)


(145
)


(35
)%Other income


8



21



(13
)


(62
)%Rental income, net


243



277



(34
)


(12
)%Gain on sale of product lines


9,642







9,642



          26




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##### Table of Contents



Income
    Tax Expense
    Net
    Income (Loss)
    Preferred
    Stock Dividends and Distributions
  Years EndedDecember 31,


Increase/2005


2004


(Decrease)


%(In $000s)Non-cash deemed dividend related
    to beneficial conversion feature of Series B Preferred Stock

$
84


$



$
84



Deemed dividend related to
    redemption of Series B Preferred Stock


1,361







1,361



Dividends on Series B
    Preferred Stock


671



676



(5
)


Allocation of undistributed
    earnings to Series A Preferred Stock


208







208



        27




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Net
    Income (Loss) Applicable to Common Shareholders
    Year
    Ended December 31, 2004 Compared to the Year Ended
    December 31, 2003
  Total
    Revenues
  Years EndedDecember 31,


Increase/2004


2003


(Decrease)


%(In $000s)Net product sales

$
18,404


$
13,655


$
4,749



35
%Contract research, grant and
    royalty revenue






58



(58
)


(100
)%Technology revenue






350



(350
)


(100
)%Total revenues

$
18,404


$
14,063


$
4,341



31
%     Net
    product sales by therapeutic area:
  Years EndedDecember 31,


Increase/2004


2003


(Decrease)


%(In $000s)Neurology

$
8,168


$
7,973


$
195



2
%Gastroenterology


9,399



4,721



4,678



99
%Nephrology


837



961



(124
)


(13
)%Total net product sales

$
18,404


$
13,655


$
4,749



35
%     Neurology
    Net Product Sales
   28




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Gastroenterology
    Net Product Sales
            Nephrology
    Net Product Sales
   29




---



##### Table of Contents



Grant
    Revenue
    Technology
    Revenue
    Cost
    of Product Sales
        Selling,
    General and Administrative
  Years EndedDecember 31,2004


2003


Increase


%(In $000s)Selling, general and
    administrative expense

$
11,551


$
10,400


$
1,151



11
%Percentage of total revenue


63
%


74
%    30




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##### Table of Contents



Research
    and Development
      Depreciation
    and Amortization
    Other
    Income and Expense Items
  Years EndedDecember 31,


Increase/2004


2003


(Decrease)


%(In $000s)Non-cash amortization of deemed
    discount on convertible debentures

$
(522
)

$
(522
)

$




Interest income


78



229



(151
)


(66
)%Interest expense


(420
)


(333
)


87



26
%Other income


21



1



20



2,000
%Other expense






(92
)


(92
)


(100
)%Rental income, net


277



260



17



7
%       other-than-temporary
   31




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Net
    Loss
    Series B
    Preferred Stock Dividends
  Years EndedDecember 31,2004


2003


Decrease


%(In $000s)Non-cash deemed dividend related
    to beneficial conversion feature of Series B Preferred Stock

$



$
1,394


$
(1,394
)


(100
)%Dividends on Series B
    Preferred Stock


676



762



(86
)


(11
)%       Net
    Loss Applicable to Common Shareholders
    Liquidity
    and Capital Resources
    As of
    December 31,Liquidity and Capital
    Resources

2005


2004


2003(In $000s)Cash, cash equivalents and
    short-term investments

$
26,577


$
8,729


$
3,220Working capital


16,121



5,082



4,352Cash provided by/(used in):Operating activities


1,367



1,758



(3,346
)Investing activities


16,419



(233
)


(13,273
)Financing activities


(6,077
)


3,984



13,683    32




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Operating
    Cash Flows
        Investing
    Cash Flows
        Financing
    Cash Flows
   33




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Cash and
    Cash Equivalents at December 31, 2005
    Off
    Balance Sheet Arrangements
    Contractual
    Obligations
  Payments Due by Period1 Year


Greater Than


4 to 5


AfterTotal


or Less


1 to 3 Years


Years


Years(In $000s)Operating leases (1)

$
9,805


$
1,668


$
3,206


$
2,973


$
1,958Minimum payments remaining under
    supply agreement with BioVectra (2)


1,137



714



423







Capital lease (3)


44



12



24



8



Purchase orders and
    obligations (4)


580



580











Series B Preferred Stock
    redemption obligation (5)


7,841



7,841











Total contractual cash obligations

$
19,407


$
10,815


$
3,653


$
2,981


$
1,958     (1)
    
    As of December 31, 2005 we leased three buildings with
    lease terms expiring in 2006 to 2012. We have also entered into
    various office equipment leases and automobile leases, the terms
    of which are typically three years. Annual rent expense for all
    of our facilities, equipment and automobile leases for the year
    ended December 31, 2005 was approximately
    $1.5 million. We lease our headquarters in Union City,
    California, with 23,000 square feet of office space under a
    lease agreement that expires in 2011. Our headquarters is
    currently occupied by our Executive, Commercial Development,
    Finance and Administration, Sales and Marketing, Regulatory
    Affairs, Contract Manufacturing, and Quality Control and Quality
    Assurance departments. Annual rent payments for 2006 for this
    facility are $526,000. We have subleased laboratory space in
    Hayward, California. This sublease expires in July 2006. We
    anticipate that we will receive at least $657,000 in 2006 as
    sublease income to partially offset the 2006 rent
    obligation of $751,000. We have begun the process to search for
    a new tenant. If we are unable to sublease the facility after
    July 2006 for an amount that would cover our obligations under
    our master lease, it would have a negative impact on us as we
    would still be obligated to make rent payments of
    $5.8 million and our share of insurance, taxes, and common
    area maintenance over the remaining term of the master lease.
    During the fourth quarter of 2005, we recognized a loss on this
    sublease of $415,000 as we may not be able to fully recover our
    lease cost over the remaining term of our master lease.(2)
    
    We have signed an agreement with BioVectra to produce the API
    used in Acthar. The agreement requires minimum production
    totaling $1.7 million during the term. We did not make any
    payments under this 34




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agreement during the year ended December 31, 2005. For the
    years ended December 31, 2004 and 2003, we paid $468,000
    and $115,000, respectively, under this agreement. The agreement
    terminates in December 2007 and includes two one-year extension
    options.(3)
    
    In August 2004, we entered into a capital lease for certain
    office equipment with a lease term expiring in August 2009.
    Annual lease payments under this lease are $12,000.(4)
    
    As of December 31, 2005, our purchase orders and
    obligations totaled $580,000 for which the goods have not yet
    been received or the services have not yet been rendered.(5)
    
    In November 2005, we notified the holders of our Series B
    Preferred Stock of our intent to redeem all outstanding shares
    of Series B Preferred Stock on January 3, 2006. We
    adjusted the carrying value of the 7,125 outstanding shares of
    Series B Preferred Stock to its redemption amount of
    $7.8 million at December 31, 2005, and classified it
    as a current liability. On January 3, 2006 we made a total
    cash payment of $7.8 million to redeem the outstanding
    Series B Preferred Stock.    Equity
    Transactions
  Significant
    Equity Transactions in Years Ended December 31, 2003, 2004
    and 2005
  Series B
    Convertible Preferred Stock
     35




---



##### Table of Contents



Common
    Stock
   36




---



##### Table of Contents



Convertible
    Debentures
    Cash
    Requirements
        Income
    Taxes
   37




---



##### Table of Contents



Recently
    Issued Accounting Standards
    fair-value-based
   38




---



##### Table of Contents



Item 7A.
    Quantitative
    and Qualitative Disclosures about Market Risk  Market
    Rate Risk
    Fair Value2005


12/31/05(In thousands, except interest
    rates)ASSETSCash, cash equivalents and
    short-term investments

$
26,577


$
26,577Average interest rate


2.43
%


LIABILITIESCapital lease

$
35


$
35Average interest rate


12.47
%


   Fair Value2004


12/31/04(In thousands, except interest
    rates)ASSETSCash and cash equivalents

$
8,729


$
8,729Average interest rate


1.09
%


LIABILITIESNotes
    payable    short-term

$
128


$
128Average interest rate


6.18
%


Convertible debentures

$
4,000


$
4,000Average interest rate


8.00
%


Secured promissory note

$
2,200


$
2,200Average interest rate


9.83
%


Capital lease

$
42


$
42Average interest rate


12.47
%


  39




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##### Table of Contents



Item 8.
    Financial
    Statements and Supplementary Data  QUESTCOR
    PHARMACEUTICALS, INC.
   CONTENTS
  PageReports of
    Independent Registered Public Accounting Firms


47Audited Financial StatementsConsolidated
    Balance Sheets


49Consolidated
    Statements of Operations


50Consolidated
    Statements of Preferred Stock and Shareholders Equity


51Consolidated
    Statements of Cash Flows


52Notes to
    Consolidated Financial Statements


53Financial Statement
    Schedules


79  40




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##### Table of Contents



Item 9.
    Changes
    In and Disagreements with Accountants on Accounting and
    Financial Disclosure  Form 8-K, Form 8-K, Regulation S-K.
  Item 9A.
    Controls
    and Procedures    Rule 13a-15(b),
    Item 9B.
    Other
    Information   PART III  Item 10.
    Directors
    and Executive Officers of the Registrant    Item 11.
    Executive
    Compensation    Item 12.
    Security
    Ownership of Certain Beneficial Owners and Management and
    Related Shareholder Matters   41




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##### Table of Contents



Item 13.
    Certain
    Relationships and Related Transactions    Item 14.
    Principal
    Accountant Fees and Services   PART IV  Item 15.
    Exhibits
    and Financial Statement Schedules    Financial Statements.
  PageReports of
    Independent Registered Public Accounting Firms


47Consolidated
    Balance Sheets


49Consolidated
    Statements of Operations


50Consolidated
    Statements of Preferred Stock and Shareholders Equity


51Consolidated
    Statements of Cash Flows


52Notes to Financial
    Statements


53   Financial Statement Schedules.
    ExhibitNumber

Description2
.1(1)

Merger agreement entered into
    August 4, 1999, by and among Cyprus Pharmaceutical
    Corporation, a California corporation (Parent),
    Cyprus Acquisition Corporation, a Delaware corporation and a
    wholly owned subsidiary of Parent, and RiboGene, Inc., a
    Delaware corporation.3
.1(2)

Amended and Restated Articles of
    Incorporation of the Company.3
.2(25)

Certificate of Amendment to the
    Questcor Pharmaceuticals, Inc. Bylaws, dated as of March 2,
    2006.3
.3(3)

Certificate of Determination of
    Series B Convertible Preferred Stock of the Company.3
.4(4)

Certificate of Determination of
    Series C Junior Participating Preferred Stock of the
    Company.3
.5(5)

Bylaws of the Company.4
.1(6)

Convertible Debenture between the
    Company and SF Capital Partners Ltd. dated March 15, 2002.4
.2(6)

Convertible Debenture between the
    Company and Defiante Farmaceutica Unipessoal Lda dated
    March 15, 2002.10
.1(7)

Forms of Incentive Stock Option
    and Non-statutory Stock Option.10
.2(8)

1992 Employee Stock Option Plan,
    as amended.10
.3(9)

1993 Non-employee Directors
    Equity Incentive Plan, as amended and related form of
    Nonstatutory Stock Option.10
.4(10)

2000 Employee Stock Purchase Plan.10
.5(11)

Asset Purchase Agreement dated
    July 27, 2001 between the Company and Aventis
    Pharmaceuticals Products, Inc.10
.6(11)

First Amendment to Asset Purchase
    Agreement dated January 29, 2002, between the Company and
    Aventis Pharmaceuticals Products, Inc. 42




---



##### Table of Contents



ExhibitNumber

Description10
.7(12)

Stock Purchase Agreement dated
    July 31, 2001 between Registrant and Sigma-Tau Finance
    Holding S.A.10
.8(13)

Warrant dated December 1,
    2001 between the Company and Paolo Cavazza.10
.9(13)

Warrant dated December 1,
    2001 between the Company and Claudio Cavazza.10
.10(6)

Securities Purchase Agreement
    between the Company and SF Capital Partners Ltd. dated
    March 15, 2002.10
.11(6)

Registration Rights Agreement
    between the Company and SF Capital Partners Ltd. dated
    March 15, 2002.10
.12(6)

Warrant between the Company and SF
    Capital Partners Ltd. dated March 15, 2002.10
.13(6)

Securities Purchase Agreement
    between the Company and Defiante Farmaceutica Unipessoal Lda
    dated March 15, 2002.10
.14(6)

Registration Rights Agreement
    between the Company and Defiante Farmaceutica Unipessoal Lda
    dated March 15, 2002.10
.15(6)

Warrant between the Company and
    Defiante Farmaceutica Unipessoal Lda dated March 15, 2002.10
.16(3)

Form of Common Stock Purchase
    Warrant dated January 15, 2003 issued by the Company to
    purchasers of Series B Convertible Preferred Stock.10
.17(4)

Rights Agreement, dated as of
    February 11, 2003, between the Company and Computershare
    Trust Company, Inc.10
.18(3)

Form of Subscription Agreement
    dated as of December 29, 2002 by and between the Company
    and purchasers of Series B Convertible Preferred Stock and
    Common Stock Purchase Warrants.10
.19(14)

Letter Agreement dated
    September 2, 2003 between the Company and R. Jerald Beers.10
.20(14)

Amendment to Letter Agreement
    dated November 6, 2003 between the Company and R. Jerald
    Beers.10
.21(14)

Supply Agreement dated
    April 1, 2003 between the Company and BioVectra, dcl.10
.22(15)

Separation Agreement dated
    August 5, 2004 between the Company and Charles J. Casamento.10
.23(16)

Secured Promissory Note and
    Security Agreement dated July 31, 2004 between the Company
    and Defiante Farmaceutica Lda.10
.24(17)

Letter Agreement between the
    Company and James L. Fares dated February 17, 2005.10
.25(18)

Amendment dated March 8, 2005
    to the 8% Convertible Debenture dated March 15, 2002
    issued by Questcor Pharmaceuticals, Inc. in favor of Defiante
    Farmaceutica Lda.10
.26(18)

Amendment dated March 10,
    2005 to the 8% Convertible Debenture dated March 15,
    2002 issued by Questcor Pharmaceuticals, Inc. in favor of SF
    Capital Partners Ltd.10
.27(19)

2004 Non-Employee Directors
    Equity Incentive Plan.10
.28(20)

Letter Agreement between the
    Company and Reinhard Koenig dated September 30, 2004.10
.29(20)

Letter Agreement between the
    Company and James L. Fares dated February 18, 2005.10
.30(20)

Letter Agreement between the
    Company and Steve Cartt dated March 7, 2005.10
.31(20)

Letter Agreement between the
    Company and Steve Cartt dated March 8, 2005.10
.32(20)

Letter Agreement between the
    Company and Reinhard Koenig dated February 3, 2004.10
.33(20)

Letter Agreement between the
    Company and Barbara J. McKee dated February 9, 2005.10
.34(20)

Separation Agreement and Release
    dated March 3, 2005 between the Company and R. Jerald Beers.10
.35(20)

Series B Preferred
    Shareholder Agreement and Waiver dated March 29, 2005 by
    and between the Company and all of the holders of the
    outstanding shares of Series B Preferred Stock of the
    Company.10
.36(22)

First Amendment, dated as of
    September 9, 2005, to Rights Agreement dated as of
    February 11, 2003, between Questcor Pharmaceuticals, Inc.
    and Computershare Trust Company, Inc.10
.37(23)

Offer of Employment Letter
    Agreement between the Company and George Stuart dated
    September 27, 2005.10
.38(23)

Change-in-Control
    Letter Agreement between the Company and George Stuart dated
    September 28, 2005. 43




---



##### Table of Contents



ExhibitNumber

Description10
.39(23)

Severance Letter Agreement between
    the Company and George Stuart dated September 28, 2005.10
.40(24)

Asset Purchase Agreement dated
    October 17, 2005 by and between Questcor Pharmaceuticals,
    Inc. and QOL Medical LLC.10
.41*

Offer of Employment Letter
    Agreement between the Company and Craig C. Chambliss
    dated March 31, 2005.10
.42*

Change-in-Control Letter Agreement
    between the Company and Craig C. Chambliss dated
    May 1, 2005.10
.43*

Severance Letter Agreement between
    the Company and Craig C. Chambliss dated May 4,
    2005.10
.44*

Severance Letter Agreement between
    the Company and David Medeiros dated July 10, 2003.16
.1(21)

Letter to the Security and
    Exchange Commission from Ernst & Young LLP.23
.1*

Consent of Odenburg, Ullakko,
    Muranishi & Co. LLP, Independent Registered Public
    Accounting Firm.23
.2*

Consent of Ernst & Young
    LLP, Independent Registered Public Accounting Firm.31
*

Certification pursuant to
    Section 302 of the Sarbanes-Oxley Act of 2002.32
*

Certification pursuant to
    Section 906 of the Public Company Accounting Reform and
    Investor Act of 2002.     *
    
    Filed herewith.  (1)
    
    Filed as an exhibit to the Companys Annual Report on
    Form 10-K
    for the fiscal year ended December 31, 1999, and
    incorporated herein by reference.(2)
    
    Filed as an exhibit to the Companys Registration Statement
    on
    Form S-8,
    Registration Statement
    No. 333-30558,
    filed on February 16, 2000, and incorporated herein by
    reference.(3)
    
    Filed as an exhibit to the Companys Current Report on
    Form 8-K
    filed on January 16, 2003, and incorporated herein by
    reference.(4)
    
    Filed as an exhibit to the Companys Current Report on
    Form 8-K
    filed on February 14, 2003, and incorporated herein by
    reference.(5)
    
    Filed as an exhibit to the Companys Quarterly Report on
    Form 10-Q
    for the quarter ended September 30, 2002, and incorporated
    herein by reference.(6)
    
    Filed as an exhibit to the Companys Registration Statement
    on
    Form S-3,
    Registration
    No. 333-85160,
    filed on March 28, 2002, and incorporated herein by
    reference.(7)
    
    Filed as an exhibit to the Companys Registration Statement
    on
    Form S-1,
    Registration
    No. 33-51682,
    and incorporated herein by reference.(8)
    
    Filed as an exhibit to the Companys Proxy Statement for
    the 2002 Annual Meeting of Shareholders, filed on March 28,
    2002, and incorporated herein by reference.(9)
    
    Filed as an exhibit to the Companys Registration Statement
    Form S-4,
    Registration Statement
    No. 333-87611,
    filed on September 23, 1999, and incorporated herein by
    reference.(10)
    
    Filed as an exhibit to the Companys Registration Statement
    on
    Form S-8,
    Registration Statement
    No. 333-46990,
    filed on September 29, 2000, and incorporated herein by
    reference.(11)
    
    Filed as an exhibit to the Companys Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 2002, and incorporated
    herein by reference.(12)
    
    Filed as an exhibit to the Companys Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 2001, and incorporated
    herein by reference.(13)
    
    Filed as an exhibit to the Companys Annual Report on
    Form 10-K
    for the fiscal year ended December 31, 2001, and
    incorporated herein by reference.(14)
    
    Filed as an exhibit to the Companys Annual Report on
    Form 10-K
    for the fiscal year ended December 31, 2003, and
    incorporated herein by reference. 44




---



##### Table of Contents



(15)
    
    Filed as an exhibit to the Companys Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 2004, and incorporated
    herein by reference.(16)
    
    Filed as an exhibit to the Companys Quarterly Report on
    Form 10-Q
    for the quarter ended September 30, 2004, and incorporated
    herein by reference.(17)
    
    Filed as an exhibit to the Companys Current Report on
    Form 8-K
    filed on February 23, 2005, and incorporated herein by
    reference.(18)
    
    Filed as an exhibit to the Companys Current Report on
    Form 8-K
    filed on March 14, 2005, and incorporated herein by
    reference.(19)
    
    Filed as an exhibit to the Companys Proxy Statement for
    the 2004 Annual Meeting of Stockholders, filed on March 29,
    2004, and incorporated herein by reference.(20)
    
    Filed as an exhibit to the Companys Annual Report on
    Form 10-K
    for the fiscal year ended December 31, 2004, and
    incorporated herein by reference.(21)
    
    Filed as an exhibit to the Companys Current Report on
    Form 8-K
    filed on April 11, 2005, and incorporated herein by
    reference.(22)
    
    Filed as an exhibit to the Companys Current Report on
    Form 8-K
    filed on September 13, 2005, and incorporated herein by
    reference.(23)
    
    Filed as an exhibit to the Companys Current Report on
    Form 8-K
    filed on September 30, 2005, and incorporated herein by
    reference.(24)
    
    Filed as an exhibit to the Companys Current Report on
    Form 8-K
    filed on October 19, 2005, and incorporated herein by
    reference.(25)
    
    Filed as an exhibit to the Companys Current Report on
    Form 8-K
    filed on March 2, 2006, and incorporated herein by
    reference.  
    
    The Company has requested confidential treatment with respect to
    portions of this exhibit. 45




---



##### Table of Contents



SIGNATURES      By
    /s/  JAMES L. FARES    President and Chief Executive Officer
      Signature

Title

Date/s/  JAMES
    L. FARESJames
    L. Fares

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

March 30, 2006/s/  GEORGE
    STUARTGeorge
    Stuart

Chief Financial Officer
    (Principal Financial and Accounting Officer)

March 30, 2006/s/  ALBERT
    HANSENAlbert
    Hansen

Chairman

March 30, 2006/s/  NEAL
    C. BRADSHERNeal
    C. Bradsher

Director

March 30, 2006/s/  GREGG
    LAPOINTEGregg
    Lapointe

Director

March 30, 2006/s/  JON
    S. SAXEJon
    S. Saxe

Director

March 30, 2006/s/  VIRGIL
    D. THOMPSONVirgil
    D. Thompson

Director

March 30, 2006  46




---



##### Table of Contents



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM                 47




---



##### Table of Contents



REPORT OF
    ERNST & YOUNG LLP, INDEPENDENT REGISTERED PUBLIC
    ACCOUNTING FIRM
                       48




---



##### Table of Contents



QUESTCOR
    PHARMACEUTICALS, INC.
  CONSOLIDATED BALANCE SHEETS
  December 31,2005


2004(In thousands, except share
    amounts)ASSETSCurrent assets:Cash and cash equivalents

$
20,438


$
8,729Short-term investments


6,139



Accounts receivable, net of
    allowance for doubtful accounts of $84 and $40 at
    December 31, 2005 and 2004, respectively


725



2,349Inventories


1,577



1,769Prepaid expenses and other current
    assets


710



839Total current assets


29,589



13,686Property and equipment, net


655



614Purchased technology, net






12,758Goodwill


299



299Deposits and other assets


805



816Total assets

$
31,348


$
28,173LIABILITIES AND
    SHAREHOLDERS EQUITYCurrent liabilities:Accounts payable

$
1,505


$
1,103Income taxes payable


200



Accrued compensation


709



974Preferred stock, 7,125
    Series B shares at redemption amount at December 31,
    2005


7,841



Sales-related reserves


2,581



1,683Other accrued liabilities


632



605Current portion of long-term debt
    and short-term debt






342Convertible debentures (face
    amount of $4,000), net of deemed discount of $103 at
    December 31, 2004






3,897Total current liabilities


13,468



8,604Long-term debt






1,986Lease termination and deferred
    rent liability


1,350



833Other non-current liabilities


27



88Commitments and contingencies (see
    Note 11)Preferred stock, no par value,
    7,500,000 shares authorized; 2,155,715 Series A shares
    issued and outstanding at December 31, 2005 and 2004
    (aggregate liquidation preference of $10,000 at
    December 31, 2005 and 2004)


5,081



5,081Shareholders equity:Preferred stock, no par value,
    10,000 shares authorized; 8,400 Series B shares issued
    and outstanding at December 31, 2004, net of issuance costs
    (aggregate liquidation preference of $8,400 at December 31,
    2004)






7,578Common stock, no par value,
    105,000,000 shares authorized; 54,461,291 and
    51,216,488 shares issued and outstanding at
    December 31, 2005 and 2004, respectively


90,576



88,436Deferred compensation


(5
)


(10
)Accumulated deficit


(79,147
)


(84,423
)Accumulated other comprehensive
    loss


(2
)


Total shareholders equity


11,422



11,581Total liabilities and
    shareholders equity

$
31,348


$
28,173    49




---



##### Table of Contents



QUESTCOR
    PHARMACEUTICALS, INC.
  CONSOLIDATED STATEMENTS OF OPERATIONS
  Years Ended
    December 31,2005


2004


2003(In thousands, exceptper share amounts)Revenues:Net product sales

$
14,162


$
18,404


$
13,655Grant revenue










58Technology revenue










350Total revenues


14,162



18,404



14,063Operating costs and expenses:Cost of product sales (exclusive
    of amortization of purchased technology)


3,110



3,730



3,573Selling, general and administrative


10,019



11,551



10,400Research and development


2,227



2,181



2,267Depreciation and amortization


995



1,208



1,157Total operating costs and expenses


16,351



18,670



17,397Loss from operations


(2,189
)


(266
)


(3,334
)Other income (expense):Non-cash amortization of deemed
    discount on convertible debentures


(108
)


(522
)


(522
)Interest income


271



78



229Interest expense


(275
)


(420
)


(333
)Other income (expense), net


8



21



(91
)Rental income, net


243



277



260Gain on sale of product lines


9,642







Total other income (expense)


9,781



(566
)


(457
)Net income (loss) before income
    taxes


7,592



(832
)


(3,791
)Income tax expense


200







Net income (loss)


7,392



(832
)


(3,791
)Non-cash deemed dividend related
    to beneficial conversion feature of Series B preferred stock


84







1,394Deemed dividend related to the
    redemption of Series B preferred stock


1,361







Dividends on Series B
    preferred stock


671



676



762Allocation of undistributed
    earnings to Series A preferred stock


208







Net income (loss) applicable to
    common shareholders

$
5,068


$
(1,508
)

$
(5,947
)Net income (loss) per share
    applicable to common shareholders  basic and
    diluted

$
0.10


$
(0.03
)

$
(0.14
)Shares used in computing net
    income (loss) per share applicable to common shareholders:Basic


52,477



50,844



41,884Diluted


53,323



50,844



41,884    50




---



##### Table of Contents



QUESTCOR
    PHARMACEUTICALS, INC.
  CONSOLIDATED STATEMENTS OF PREFERRED STOCK AND
    SHAREHOLDERS EQUITY
  AccumulatedPreferred Stock














Other


TotalSeries A


Series B


Common Stock


Deferred


Accumulated


Comprehensive


ShareholdersShares


Amount


Shares


Amount


Shares


Amount


Compensation


Deficit


Gain (Loss)


Equity(In thousands, except
    shares)Balances at January 1, 2003


2,155,715


$
5,081






$




38,676,592


$
77,528


$
(22
)

$
(76,968
)

$
(42
)

$
496Stock compensation for options and
    warrants granted to consultants and employees






















50















50Deferred compensation






















15



(15
)










Amortization of deferred
    compensation


























20











20Issuance of shares pursuant to
    employee stock purchase plan


















93,123



68















68Issuance of common stock to
    investors


















4,979,360



4,826















4,826Issuance of common stock upon
    cashless exercise of warrants


















387,995



















Issuance of common stock upon
    surrender of stock options


















273,962



212















212Issuance of Series B preferred
    stock, net of issuance costs










10,000



9,404























9,404Warrants issued on Series B
    preferred stock














(1,620
)






1,620















Issuance of common stock upon
    conversion of Series B preferred stock










(900
)


(900
)


956,225



900















Issuance of common stock upon
    conversion of accrued dividends for Series B preferred stock


















20,545



13















13Deemed dividends on Series B
    preferred stock














1,394















(1,394
)






Dividends on Series B
    preferred stock






























(762
)






(762
)Comprehensive income (loss):Other than temporary loss on
    investments


































51



51Reclassification of net unrealized
    loss on investments into realized loss


































(9
)


(9
)Net loss






























(3,791
)






(3,791
)Total comprehensive loss






































(3,749
)Balances at December 31, 2003


2,155,715



5,081



9,100



8,278



45,387,802



85,232



(17
)


(82,915
)






10,578Stock compensation for options and
    warrants granted to consultants and employees






















21















21Stock compensation from
    modification of employee stock options






















9















9Amortization of deferred
    compensation


























7











7Issuance of shares pursuant to
    employee stock purchase plan


















182,267



90















90Issuance of common stock to
    investors, net of issuance costs


















1,000,000



610















610Issuance of common stock upon
    surrender of warrants


















3,878,201



1,755















1,755Issuance of common stock upon
    exercise of stock options


















20,076



15















15Issuance of common stock upon
    conversion of Series B preferred stock










(700
)


(700
)


743,732



700















Issuance of common stock upon
    conversion of accrued dividends for Series B preferred stock


















4,410



4















4Dividends on Series B
    preferred stock






























(676
)






(676
)Net loss and comprehensive loss






























(832
)






(832
)Balances at December 31, 2004


2,155,715



5,081



8,400



7,578



51,216,488



88,436



(10
)


(84,423
)






11,581Stock compensation for options and
    warrants granted to consultants and employees






















29















29Deemed dividend on Series B
    preferred stock






















84







(84
)






Amortization of deferred
    compensation


























5











5Issuance of shares pursuant to
    employee stock purchase plan


















347,023



151















151Issuance of common stock upon
    cashless exercise of warrant


















42,927



















Issuance of common stock dividend
    to Series B holders in lieu of cash dividend


















1,344,000



671







(671
)






Issuance of common stock upon
    exercise of stock options


















157,735



107















107Issuance of common stock upon
    conversion of Series B preferred stock










(1,275
)


(1,275
)


1,353,118



1,275















Deemed dividend related to the
    redemption of Series B preferred stock














1,538







(177
)






(1,361
)






Series B preferred stock
    redemption amount reclassified to current liability










(7,125
)


(7,841
)






















(7,841
)Comprehensive income (loss):Net unrealized loss on investments


































(2
)


(2
)Net income






























7,392







7,392Total comprehensive income






































7,390Balances at December 31, 2005


2,155,715


$
5,081






$




54,461,291


$
90,576


$
(5
)

$
(79,147
)

$
(2
)

$
11,422    51




---



##### Table of Contents



QUESTCOR
    PHARMACEUTICALS, INC.
  CONSOLIDATED STATEMENTS OF CASH FLOWS
  Years Ended
    December 31,2005


2004


2003(In thousands)Cash Flows Provided by (Used in)
    Operating ActivitiesNet income (loss)

$
7,392


$
(832
)

$
(3,791
)Adjustments to reconcile net income
    (loss) to net cash provided by (used in) operating activities:Stock-based compensation expense


29



30



75Amortization of deemed discount on
    convertible debentures


108



522



522Depreciation and amortization


995



1,208



1,157Gain on sale of product lines


(9,642
)






Other


13



187



111Changes in operating assets and
    liabilities:Accounts receivable


1,624



(188
)


(571
)Inventories


(34
)


(719
)


(596
)Prepaid expenses and other current
    assets


(418
)


34



81Accounts payable


402



(299
)


172Income taxes payable


200







Accrued compensation


(265
)


616



(436
)Sales-related reserves


473



1,101



164Other accrued liabilities


27



128



(317
)Other non-current liabilities


463



(30
)


83Net cash provided by (used in)
    operating activities


1,367



1,758



(3,346
)Cash Flows Provided by (Used in)
    Investing ActivitiesAcquisition of purchased technology


(2,000
)






(14,289
)Purchase of short-term investments


(6,141
)


(1,000
)


(3,009
)Proceeds from the sale and
    maturities of short-term investments






1,000



4,337Purchase of property, equipment and
    leasehold improvements


(241
)


(220
)


(334
)Net proceeds from sale of product
    lines


24,794







Proceeds from the sale of equipment


1



2



24Increase (decrease) in deposits and
    other assets


6



(15
)


(2
)Net cash provided by (used in)
    investing activities


16,419



(233
)


(13,273
)Cash Flows Provided by (Used in)
    Financing ActivitiesIssuance of common stock and
    warrants, net


258



2,470



5,106Issuance of preferred stock, net










9,404Payment of preferred stock dividends






(672
)


(749
)Short-term borrowings


191



516



587Redemption of convertible debentures


(4,000
)






Proceeds from Defiante note






2,200



Repayment of Defiante note


(2,200
)






Repayment of short-term debt and
    capital lease obligations


(326
)


(530
)


(665
)Net cash provided by (used in)
    financing activities


(6,077
)


3,984



13,683Increase (decrease) in cash and
    cash equivalents


11,709



5,509



(2,936
)Cash and cash equivalents at
    beginning of year


8,729



3,220



6,156Cash and cash equivalents at end of
    year

$
20,438


$
8,729


$
3,220Supplemental Disclosures of Cash
    Flow Information:Cash paid for interest

$
275


$
420


$
413Non-Cash Investing and Financing
    Activities:Common stock issued in lieu of
    quarterly cash dividends on Series B preferred stock

$
671


$



$
Common stock issued upon conversion
    of Series B preferred stock and accrued dividends for
    Series B preferred stock

$
1,275


$
704


$
13Equipment acquired under capital
    lease

$



$
44


$
    52




---



##### Table of Contents



QUESTCOR
    PHARMACEUTICALS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
  1.
    Organization
    and Summary of Significant Accounting Policies  Organization
    and Business Activity
  ® ® ® ® ®
      Need
    to Raise Additional Capital
    Use of
    Estimates
    Cash
    Equivalents and Short-Term Investments
  Available-for-sale
 53




---



##### Table of Contents



QUESTCOR
    PHARMACEUTICALS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Concentration
    of Risk
    December 31,% of Accounts
    Receivable

2005


2004Wholesaler A


22
%


31
%Wholesaler B


27
%


32
%Wholesaler C


24
%


25
%Other customers


27
%


12
%100
%


100
%   Years Ended
    December 31,% of Gross Product
    Sales

2005


2004


2003Wholesaler A


35
%


29
%


35
%Wholesaler B


29
%


28
%


25
%Wholesaler C


23
%


24
%


18
%Other customers


13
%


19
%


22
%100
%


100
%


100
%     Inventories
  first-in, product-by-product
  Property
    and Equipment
    Useful Livesin YearsLaboratory equipment


5Manufacturing equipment


5-8Office equipment, furniture and
    fixtures


3-5Leasehold improvements


5-10  54




---



##### Table of Contents



QUESTCOR
    PHARMACEUTICALS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Intangible
    and Other Long-Lived Assets
    Impairment
    of Long-Lived Assets
    Revenue
    Recognition
     55




---



##### Table of Contents



QUESTCOR
    PHARMACEUTICALS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
            Shipping
    and Handling Costs
    Research
    and Development
    Net
    Income (Loss) Per Share Applicable to Common
    Shareholders
  EITF 03-06
 56




---



##### Table of Contents



QUESTCOR
    PHARMACEUTICALS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Years Ended
    December 31,2005


2004


2003Net income (loss) applicable to
    common shareholders

$
5,068


$
(1,508
)

$
(5,947
)Shares used in computing net
    income (loss) per share applicable to common shareholders:Basic


52,477



50,844



41,884Effect of dilutive potential
    common shares:Stock options


830







Warrants and placement agent unit
    options


16







Diluted


53,323



50,844



41,884Basic and diluted net income
    (loss) per share applicable to common shareholders

$
0.10


$
(0.03
)

$
(0.14
)       Stock-Based
    Compensation
   57




---



##### Table of Contents



QUESTCOR
    PHARMACEUTICALS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        Years Ended
    December 31,2005


2004


2003Net income (loss) applicable to
    common shareholders, as reported

$
5,068


$
(1,508
)

$
(5,947
)Add: Stock-based employee
    compensation expense included in reported net income (loss)


5



7



58Add: Adjustment to stock-based
    employee compensation due to forfeitures of unvested options,
    primarily related to officer resignations






488



Deduct: Total stock-based employee
    compensation expense determined under fair value method for all
    awards


(445
)


(720
)


(1,439
)Net income (loss) applicable to
    common shareholders, pro forma

$
4,628


$
(1,733
)

$
(7,328
)Basic and diluted net income
    (loss) per share applicable to common shareholders:As reported

$
0.10


$
(0.03
)

$
(0.14
)Pro forma

$
0.09


$
(0.03
)

$
(0.17
)   Comprehensive
    Income (Loss)
    Reclassifications
    Segment
    Information
   58




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##### Table of Contents



QUESTCOR
    PHARMACEUTICALS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Years Ended
    December 31,2005


2004


2003Neurology

$
8,425


$
8,168


$
7,973Gastroenterology


5,084



9,399



4,721Nephrology


653



837



961$
14,162


$
18,404


$
13,655   Recently
    Issued Accounting Standards
    fair-value-based
   59




---



##### Table of Contents



QUESTCOR
    PHARMACEUTICALS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    2.
    Sale of
    Nascobal, Ethamolin and Glofil-125 Product Lines    3.
    Development
    and Collaboration Agreements   60




---



##### Table of Contents



QUESTCOR
    PHARMACEUTICALS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     4.
    Product
    Acquisition  (Vitamin B-12),
   61




---



##### Table of Contents



QUESTCOR
    PHARMACEUTICALS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   5.
    Investments    Gross


GrossAmortized


Unrealized


EstimatedCost


Gain (Loss)


Fair ValueDecember 31,
    2005Cash equivalents:Money market funds

$
7,706


$



$
7,706Commercial paper


1,996



1



1,997Corporate bonds


6,858



(1
)


6,857$
16,560


$



$
16,560Short-term investments:Commercial paper

$
989


$
1


$
990Corporate bonds


5,152



(3
)


5,149$
6,141


$
(2
)

$
6,139December 31,
    2004Cash equivalents:Money market funds

$
5,693


$



$
5,693Commercial paper


2,245







2,245$
7,938


$



$
7,938   available-for-sale other-than-temporary
  6.
    Inventories    December 31,2005


2004Raw materials

$
1,335


$
1,239Work in Process






228Finished goods


342



409Less allowance for excess and
    obsolete inventories


(100
)


(107
)$
1,577


$
1,769  62




---



##### Table of Contents



QUESTCOR
    PHARMACEUTICALS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   7.
    Property
    and Equipment    December 31,2005


2004Laboratory equipment

$
8


$
9Manufacturing equipment


515



446Office equipment, furniture and
    fixtures


983



886Leasehold improvements


392



3291,898



1,670Less accumulated depreciation and
    amortization


(1,243
)


(1,056
)$
655


$
614     8.
    Purchased
    Technology and Goodwill    December 31,2005


2004Goodwill

$
1,023


$
1,023Purchased technology






14,223Less accumulated amortization


(724
)


(2,189
)$
299


$
13,057        63




---



##### Table of Contents



QUESTCOR
    PHARMACEUTICALS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   9.
    Convertible
    Debentures       64




---



##### Table of Contents



QUESTCOR
    PHARMACEUTICALS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   10.
    Long-Term
    Debt  Long-term debt consists of the following (in thousands):
  December 31,2005


2004Convertible debentures (net of
    deemed discount of $103 at December 31, 2004) bearing
    interest of 8%

$



$
3,897Secured promissory note, bearing
    interest of 9.83%






2,200Notes payable for product
    liability insurance, bearing interest of 5.5%






81Notes payable for property and
    liability insurance, bearing interest of 5.5%






47



6,225Less current portion






(4,239
)Total

$



$
1,986           11.
    Indemnifications,
    Commitments and Contingencies  Indemnifications
    Employment
    Agreements
   65




---



##### Table of Contents



QUESTCOR
    PHARMACEUTICALS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  change in control. In addition, certain of the agreements
    provide for the accelerated vesting of outstanding unvested
    stock options upon a change in control.
  Leases
  The Company leases office facilities under various operating
    lease agreements, with remaining terms that extend to November
    2012. The Company has also entered into automobile and office
    equipment leases, with remaining terms that extend to January
    2009. The Company also entered into a capital lease for certain
    office equipment in August 2004 that extends to August 2009.
    Minimum future obligations under the leases as of
    December 31, 2005 are as follows (in thousands):
  AutomobileFacility





and Office


Operating


CapitalOperating


Sublease


Equipment


Leases


LeasesYear Ending
    December 31,

Leases


Income


Leases


Total


Total2006

$
1,311


$
(664
)

$
357


$
1,004


$
122007


1,359







280



1,639



122008


1,409







158



1,567



122009


1,459







2



1,461



82010


1,512











1,512



Thereafter


1,958











1,958



$
9,008


$
(664
)

$
797


$
9,141


$
44Less: amounts representing interest


















(9
)Present value of minimum lease
    payments


















35Current portion of capital lease
    obligations


















8Long-term capital lease obligations

















$
27      66




---



##### Table of Contents



QUESTCOR
    PHARMACEUTICALS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
            Contingencies
    Commitments
    12.
    Preferred
    Stock and Shareholders Equity  Preferred
    Stock
   67




---



##### Table of Contents



QUESTCOR
    PHARMACEUTICALS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
           68




---



##### Table of Contents



QUESTCOR
    PHARMACEUTICALS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
         69




---



##### Table of Contents



QUESTCOR
    PHARMACEUTICALS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        Common
    Stock
  winding-up
   70




---



##### Table of Contents



QUESTCOR
    PHARMACEUTICALS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
       Warrants
    Outstanding
    Number





ExpirationExercise Price

Outstanding


Date Issued


Date$ 0.64


44,500



4/30/2001



4/30/2006$ 0.94


3,025,921



1/15/2003



1/15/2008$ 1.26


475,248



6/11/2003



6/11/2008$ 1.70


859,494



3/15/2002



3/15/2006$31.51


2,694



3/12/1997



3/12/20074,407,857   Placement
    Agent Unit Options
    Stock
    Option Plans
     71




---



##### Table of Contents



QUESTCOR
    PHARMACEUTICALS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Years Ended
    December 31,2005


2004


2003Expected stock price volatility


64
%


52
%


67
%Risk-free interest rate


4.1
%


3
%


3
%Expected life (in years)


4.0



3.8



3.9Expected dividend yield










            72




---



##### Table of Contents



QUESTCOR
    PHARMACEUTICALS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
           73




---



##### Table of Contents



QUESTCOR
    PHARMACEUTICALS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Options


Weighted AverageOutstanding


Exercise PriceBalance at January 1, 2003


8,942,262


$
1.41Granted


2,170,555


$
0.83Exercised


(273,962
)

$
0.77Canceled


(1,081,353
)

$
1.67Balance at December 31, 2003


9,757,502


$
1.27Granted


1,388,240


$
0.66Exercised


(20,076
)

$
0.82Canceled


(5,440,207
)

$
1.36Balance at December 31, 2004


5,685,459


$
1.03Granted


4,144,000


$
0.54Exercised


(157,735
)

$
0.68Canceled


(3,269,650
)

$
0.95Balance at December 31, 2005


6,402,074


$
0.76      74




---



##### Table of Contents



QUESTCOR
    PHARMACEUTICALS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Exercise prices and weighted average remaining contractual
    life for the options outstanding as of December 31, 2005
    are as follows:
  Options OutstandingWeighted Average





Options ExercisableNumber


Remaining


Weighted Average


Number


Weighted AverageRange of Exercise
    Price

Outstanding


Contractual Life


Exercise Price


Exercisable


Exercise Price$0.44 - $0.44


1,679,395



9.09


$
0.44



58,385


$
0.44$0.45 - $0.50


1,017,041



9.40


$
0.48



10,540


$
0.50$0.51 - $0.54


712,500



9.06


$
0.53



119,685


$
0.53$0.55 - $0.68


686,675



6.72


$
0.61



349,191


$
0.59$0.74 - $0.99


804,593



7.87


$
0.88



438,041


$
0.87$1.02 - $1.19


693,881



7.21


$
1.06



388,881


$
1.09$1.24 - $2.15


647,216



4.07


$
1.47



645,964


$
1.47$2.28 - $3.61


143,000



1.97


$
2.78



143,000


$
2.78$3.73 - $3.73


12,773



2.42


$
3.73



12,773


$
3.73$4.94 - $4.94


5,000



2.10


$
4.94



5,000


$
4.946,402,074



7.84


$
0.76



2,171,460


$
1.16   Reserved
    Shares
    December 31,2005Outstanding options


6,402,074Convertible preferred stock issued
    and outstanding


9,725,838Placement agent unit options


127,676Common stock warrants


4,407,857Reserved for future grant or sale
    under option and stock purchase plans


7,582,74828,246,193   13.
    Income
    Taxes   75




---



##### Table of Contents



QUESTCOR
    PHARMACEUTICALS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Years Ended
    December 31,2005


2004


2003Tax expense (benefit) at federal
    statutory rate


34.0
%


(34.0
)%


(34.0
)%State income taxes, net of federal
    benefit


6.7



(8.9
)


(9.6
)Change in valuation allowance


(38.0
)


33.9



36.7Other


0.0



9.0



6.9Effective tax rate


2.7
%



%



%     December 31,2005


2004Deferred tax liabilities:Goodwill and purchased intangibles

$
(200
)

$
100Deferred tax assets:Net operating loss carryforwards

$
33,000


$
35,300Research and development credits


1,600



1,400Capitalized research and
    development expenses


100



300Acquired research and development


900



1,200Other, net


1,100



1,500Total deferred tax assets


36,700



39,700Valuation allowance


(36,900
)


(39,600
)Net deferred taxes

$



$
     14.
    Other
    Related Party Transactions   76




---



##### Table of Contents



QUESTCOR
    PHARMACEUTICALS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
          15.
    Defined
    Contribution Plan    16.
    Comprehensive
    Income (Loss)  available-for-sale
  Years Ended
    December 31,2005


2004


2003Net income (loss)

$
7,392


$
(832
)

$
(3,791
)Change in unrealized gains
    (losses) on
    available-for-sale
    securities


(2
)






42Comprehensive income (loss)

$
7,390


$
(832
)

$
(3,749
)  77




---



##### Table of Contents



QUESTCOR
    PHARMACEUTICALS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   17.
    Shareholders
    Rights Plan  (1/100th)
    18.
    Subsequent
    Event   78




---



##### Table of Contents



QUESTCOR
    PHARMACEUTICALS, INC.
   FINANCIAL STATEMENT SCHEDULES (ITEM 15(a)(2))
  SCHEDULE II VALUATION AND QUALIFYING
    ACCOUNTS
    Years Ended December 31, 2005, 2004 and 2003
  Additions/Balance at


(Deductions)


Deductions


Balance atBeginning


Charged to


and


End ofPeriod


Income


Write-Offs


Period(In thousands)Reserves for uncollectible accountsDecember 31, 2005

$
40


$
405


$
361


$
84December 31, 2004

$
60


$
(16
)

$
4


$
40December 31, 2003

$
20


$
43


$
3


$
60Reserves for cash discountsDecember 31, 2005

$
42


$
457


$
483


$
16December 31, 2004

$
33


$
371


$
362


$
42December 31, 2003

$
29


$
255


$
251


$
33Reserves for obsolete and excess
    inventoriesDecember 31, 2005

$
107


$
193


$
200


$
100December 31, 2004

$
341


$
(61
)

$
173


$
107December 31, 2003

$
76


$
406


$
141


$
341Reserves for sales and product
    return allowancesDecember 31, 2005

$
1,683


$
7,214


$
6,316


$
2,581December 31, 2004

$
582


$
2,278


$
1,177


$
1,683December 31, 2003

$
418


$
1,217


$
1,053


$
582    79




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##### Table of Contents



EXHIBIT INDEX
  ExhibitNumber

Description2
.1(1)

Merger agreement entered into
    August 4, 1999, by and among Cyprus Pharmaceutical
    Corporation, a California corporation
    (Parent), Cyprus Acquisition Corporation, a
    Delaware corporation and a wholly owned subsidiary of Parent,
    and RiboGene, Inc., a Delaware corporation.3
.1(2)

Amended and Restated Articles of
    Incorporation of the Company.3
.2(25)

Certificate of Amendment to the
    Questcor Pharmaceuticals, Inc. Bylaws, dated as of March 2,
    2006.3
.3(3)

Certificate of Determination of
    Series B Convertible Preferred Stock of the Company.3
.4(4)

Certificate of Determination of
    Series C Junior Participating Preferred Stock of the
    Company.3
.5(5)

Bylaws of the Company.4
.1(6)

Convertible Debenture between the
    Company and SF Capital Partners Ltd. dated March 15, 2002.4
.2(6)

Convertible Debenture between the
    Company and Defiante Farmaceutica Unipessoal Lda dated
    March 15, 2002.10
.1(7)

Forms of Incentive Stock Option
    and Non-statutory Stock Option.10
.2(8)

1992 Employee Stock Option Plan,
    as amended.10
.3(9)

1993 Non-employee Directors
    Equity Incentive Plan, as amended and related form of
    Nonstatutory Stock Option.10
.4(10)

2000 Employee Stock Purchase Plan.10
.5(11)

Asset Purchase Agreement dated
    July 27, 2001 between the Company and Aventis
    Pharmaceuticals Products, Inc.10
.6(11)

First Amendment to Asset Purchase
    Agreement dated January 29, 2002, between the Company and
    Aventis Pharmaceuticals Products, Inc.10
.7(12)

Stock Purchase Agreement dated
    July 31, 2001 between Registrant and Sigma-Tau Finance
    Holding S.A.10
.8(13)

Warrant dated December 1,
    2001 between the Company and Paolo Cavazza.10
.9(13)

Warrant dated December 1,
    2001 between the Company and Claudio Cavazza.10
.10(6)

Securities Purchase Agreement
    between the Company and SF Capital Partners Ltd. dated
    March 15, 2002.10
.11(6)

Registration Rights Agreement
    between the Company and SF Capital Partners Ltd. dated
    March 15, 2002.10
.12(6)

Warrant between the Company and SF
    Capital Partners Ltd. dated March 15, 2002.10
.13(6)

Securities Purchase Agreement
    between the Company and Defiante Farmaceutica Unipessoal Lda
    dated March 15, 2002.10
.14(6)

Registration Rights Agreement
    between the Company and Defiante Farmaceutica Unipessoal Lda
    dated March 15, 2002.10
.15(6)

Warrant between the Company and
    Defiante Farmaceutica Unipessoal Lda dated March 15, 2002.10
.16(3)

Form of Common Stock Purchase
    Warrant dated January 15, 2003 issued by the Company to
    purchasers of Series B Convertible Preferred Stock.10
.17(4)

Rights Agreement, dated as of
    February 11, 2003, between the Company and Computershare
    Trust Company, Inc.10
.18(3)

Form of Subscription Agreement
    dated as of December 29, 2002 by and between the Company
    and purchasers of Series B Convertible Preferred Stock and
    Common Stock Purchase Warrants.10
.19(14)

Letter Agreement dated
    September 2, 2003 between the Company and R. Jerald Beers.10
.20(14)

Amendment to Letter Agreement
    dated November 6, 2003 between the Company and R. Jerald
    Beers.10
.21(14)

Supply Agreement dated
    April 1, 2003 between the Company and BioVectra, dcl.10
.22(15)

Separation Agreement dated
    August 5, 2004 between the Company and Charles J. Casamento.10
.23(16)

Secured Promissory Note and
    Security Agreement dated July 31, 2004 between the Company
    and Defiante Farmaceutica Lda.10
.24(17)

Letter Agreement between the
    Company and James L. Fares dated February 17, 2005.




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##### Table of Contents



ExhibitNumber

Description10
.25(18)

Amendment dated March 8, 2005
    to the 8% Convertible Debenture dated March 15, 2002
    issued by Questcor Pharmaceuticals, Inc. in favor of Defiante
    Farmaceutica Lda.10
.26(18)

Amendment dated March 10,
    2005 to the 8% Convertible Debenture dated March 15,
    2002 issued by Questcor Pharmaceuticals, Inc. in favor of SF
    Capital Partners Ltd.10
.27(19)

2004 Non-Employee Directors
    Equity Incentive Plan.10
.28(20)

Letter Agreement between the
    Company and Reinhard Koenig dated September 30, 2004.10
.29(20)

Letter Agreement between the
    Company and James L. Fares dated February 18, 2005.10
.30(20)

Letter Agreement between the
    Company and Steve Cartt dated March 7, 2005.10
.31(20)

Letter Agreement between the
    Company and Steve Cartt dated March 8, 2005.10
.32(20)

Letter Agreement between the
    Company and Reinhard Koenig dated February 3, 2004.10
.33(20)

Letter Agreement between the
    Company and Barbara J. McKee dated February 9, 2005.10
.34(20)

Separation Agreement and Release
    dated March 3, 2005 between the Company and R. Jerald Beers.10
.35(20)

Series B Preferred
    Shareholder Agreement and Waiver dated March 29, 2005 by
    and between the Company and all of the holders of the
    outstanding shares of Series B Preferred Stock of the
    Company.10
.36(22)

First Amendment, dated as of
    September 9, 2005, to Rights Agreement dated as of
    February 11, 2003, between Questcor Pharmaceuticals, Inc.
    and Computershare Trust Company, Inc.10
.37(23)

Offer of Employment Letter
    Agreement between the Company and George Stuart dated
    September 27, 2005.10
.38(23)

Change-in-Control
    Letter Agreement between the Company and George Stuart dated
    September 28, 2005.10
.39(23)

Severance Letter Agreement between
    the Company and George Stuart dated September 28, 2005.10
.40(24)

Asset Purchase Agreement dated
    October 17, 2005 by and between Questcor Pharmaceuticals,
    Inc. and QOL Medical LLC.10
.41*

Offer of Employment Letter
    Agreement between the Company and Craig C. Chambliss
    dated March 31, 2005.10
.42*

Change-in-Control Letter Agreement
    between the Company and Craig C. Chambliss dated
    May 1, 2005.10
.43*

Severance Letter Agreement between
    the Company and Craig C. Chambliss dated May 4,
    2005.10
.44*

Severance Letter Agreement between
    the Company and David Medeiros dated July 10, 2003.16
.1(21)

Letter to the Security and
    Exchange Commission from Ernst & Young LLP.23
.1*

Consent of Odenburg, Ullakko,
    Muranishi & Co. LLP, Independent Registered Public
    Accounting Firm.23
.2*

Consent of Ernst & Young
    LLP, Independent Registered Public Accounting Firm.31
*

Certification pursuant to
    Section 302 of the Sarbanes-Oxley Act of 2002.32
*

Certification pursuant to
    Section 906 of the Public Company Accounting Reform and
    Investor Act of 2002.     *
    
    Filed herewith.  (1)
    
    Filed as an exhibit to the Companys Annual Report on
    Form 10-K
    for the fiscal year ended December 31, 1999, and
    incorporated herein by reference.(2)
    
    Filed as an exhibit to the Companys Registration Statement
    on
    Form S-8,
    Registration Statement
    No. 333-30558,
    filed on February 16, 2000, and incorporated herein by
    reference.(3)
    
    Filed as an exhibit to the Companys Current Report on
    Form 8-K
    filed on January 16, 2003, and incorporated herein by
    reference.(4)
    
    Filed as an exhibit to the Companys Current Report on
    Form 8-K
    filed on February 14, 2003, and incorporated herein by
    reference.(5)
    
    Filed as an exhibit to the Companys Quarterly Report on
    Form 10-Q
    for the quarter ended September 30, 2002, and incorporated
    herein by reference.




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##### Table of Contents



(6)
    
    Filed as an exhibit to the Companys Registration Statement
    on
    Form S-3,
    Registration
    No. 333-85160,
    filed on March 28, 2002, and incorporated herein by
    reference.(7)
    
    Filed as an exhibit to the Companys Registration Statement
    on
    Form S-1,
    Registration
    No. 33-51682,
    and incorporated herein by reference.(8)
    
    Filed as an exhibit to the Companys Proxy Statement for
    the 2002 Annual Meeting of Shareholders, filed on March 28,
    2002, and incorporated herein by reference.(9)
    
    Filed as an exhibit to the Companys Registration Statement
    Form S-4,
    Registration Statement
    No. 333-87611,
    filed on September 23, 1999, and incorporated herein by
    reference.(10)
    
    Filed as an exhibit to the Companys Registration Statement
    on
    Form S-8,
    Registration Statement
    No. 333-46990,
    filed on September 29, 2000, and incorporated herein by
    reference.(11)
    
    Filed as an exhibit to the Companys Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 2002, and incorporated
    herein by reference.(12)
    
    Filed as an exhibit to the Companys Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 2001, and incorporated
    herein by reference.(13)
    
    Filed as an exhibit to the Companys Annual Report on
    Form 10-K
    for the fiscal year ended December 31, 2001, and
    incorporated herein by reference.(14)
    
    Filed as an exhibit to the Companys Annual Report on
    Form 10-K
    for the fiscal year ended December 31, 2003, and
    incorporated herein by reference.(15)
    
    Filed as an exhibit to the Companys Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 2004, and incorporated
    herein by reference.(16)
    
    Filed as an exhibit to the Companys Quarterly Report on
    Form 10-Q
    for the quarter ended September 30, 2004, and incorporated
    herein by reference.(17)
    
    Filed as an exhibit to the Companys Current Report on
    Form 8-K
    filed on February 23, 2005, and incorporated herein by
    reference.(18)
    
    Filed as an exhibit to the Companys Current Report on
    Form 8-K
    filed on March 14, 2005, and incorporated herein by
    reference.(19)
    
    Filed as an exhibit to the Companys Proxy Statement for
    the 2004 Annual Meeting of Stockholders, filed on March 29,
    2004, and incorporated herein by reference.(20)
    
    Filed as an exhibit to the Companys Annual Report on
    Form 10-K
    for the fiscal year ended December 31, 2004, and
    incorporated herein by reference.(21)
    
    Filed as an exhibit to the Companys Current Report on
    Form 8-K
    filed on April 11, 2005, and incorporated herein by
    reference.(22)
    
    Filed as an exhibit to the Companys Current Report on
    Form 8-K
    filed on September 13, 2005, and incorporated herein by
    reference.(23)
    
    Filed as an exhibit to the Companys Current Report on
    Form 8-K
    filed on September 30, 2005, and incorporated herein by
    reference.(24)
    
    Filed as an exhibit to the Companys Current Report on
    Form 8-K
    filed on October 19, 2005, and incorporated herein by
    reference.(25)
    
    Filed as an exhibit to the Companys Current Report on
    Form 8-K
    filed on March 2, 2006, and incorporated herein by
    reference.  
    
    The Company has requested confidential treatment with respect to
    portions of this exhibit.