Adamis Pharmaceuticals Corp (Form: 10-Q, Received: 02/15/2011 06:12:25)

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended December 31, 2010

OR

o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______ to _______

Commission File Number: 0-26372

ADAMIS PHARMACEUTICALS CORPORATION

(Exact name of registrant as specified in its charter)


Delaware		82-0429727
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification Number)

2658 Del Mar Heights Road, #555, Del Mar, CA 92014

(Address of principal executive offices, including zip code)

(858) 401-3984

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Sections 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes o No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “larger accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer	o	Accelerated filer	o

Non-accelerated filer	o	Smaller reporting company	x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes  No 

The number of shares outstanding of the issuer’s common stock, par value $0.0001 per share, as of February 11, 2011 was 81,590,344.

ADAMIS PHARMACEUTICALS, INC.

CONTENTS OF QUARTERLY REPORT ON FORM 10-Q

		Page
PART I	FINANCIAL INFORMATION

Item 1.	Financial Statements:	3

	Condensed Consolidated Balance Sheets

	Condensed Consolidated Statements of Operations	4

	Condensed Consolidated Statements of Cash Flows	5

	Notes to Condensed Consolidated Financial Statements	7

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	1 5

Item 3.	Quantitative and Qualitative Disclosure of Market Risk	23

Item 4.	Controls and Procedures	23

PART II	OTHER INFORMATION

Item 1.	Legal Proceedings	2 3

Item 1A.	Risk Factors	25

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	26

Item 3.	Defaults Upon Senior Securities	26

Item 4.	(Removed and Reserved)	26

Item 5.	Other Information	26

Item 6.	Exhibits	27

Signatures		2 8

PART I - FINANCIAL INFORMATION

ITEM 1. Financial Statements

ADAMIS PHARMACEUTICALS CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

ASSETS
	December 31, 2010
	(Unaudited)			March 31, 2010
CURRENT ASSETS
Cash	$	2,564,596		$	290,299
Accounts Receivable		-			5,555
Inventory, Net		-			2,709
Prepaid Consulting Fees and Other Current Assets		366,206			13,004
Assets from Discontinued Operations		200,000			350,000
Total Current Assets		3,130,802			661,567
PROPERTY AND EQUIPMENT, Net		985			14,667
Total Assets	$	3,131,787		$	676,234
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES
Accounts Payable	$	1,253,954		$	1,560,312
Accrued Other Expenses		441,419			205,981
Accrued Bonuses		398,580			1,401,821
Notes Payable		1,163,000			1,472,631
Notes Payable to Related Parties		101,232			309,565
Total Liabilities		3,358,185			4,950,310


COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY (DEFICIT)
Preferred Stock – Par Value $.0001; 10,000,000 Shares
Authorized; Issued and Outstanding-None		-			-
Common Stock – Par Value $.0001; 175,000,000 Shares Authorized;
86,818,532 and 50,149,639 Issued, 81,590,344 and 49,047,953 Outstanding, Respectively		8,682			5,015
Additional Paid-in Capital		24,487,346			14,609,235
Accumulated Deficit		(24,717,197	)		(18,887,224	)
Treasury Stock - 5,228,188 and 1,101,686 Shares		(5,229	)		(1,102	)
Total Stockholders' Equity (Deficit)		(226,398	)		(4,274,076	)
	$	3,131,787		$	676,234

The Accompanying Notes are an Integral Part of These Unaudited Condensed Consolidated Financial Statements.

ADAMIS PHARMACEUTICALS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

	Three Months Ended						Nine Months Ended
	December 31, 2010			December 31, 2009			December 31, 2010			December 31, 2009
	(Unaudited)			(Unaudited)			(Unaudited)			(Unaudited)

REVENUE	$	-		$	118,751		$	-		$	351,091

COST OF GOODS SOLD		-			53,663			-			121,237
Gross Margin		-			65,088			-			229,854

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES		928,668			704,994			3,012,993			1,987,279
RESEARCH AND DEVELOPMENT		2,092,524			52,427			2,109,820			150,990
Loss from Operations		(3,021,192	)		(692,333	)		(5,122,813	)		(1,908,415	)

OTHER INCOME (EXPENSE)
Interest Expense		(72,148	)		(257,482	)		(712,760	)		(269,965	)
Gain on Sale of Asset		-			-			5,600			-

Net (Loss)	$	(3,093,340	)	$	(949,815	)	$	(5,829,973	)	$	(2,178,380	)

Basic and Diluted (Loss) Per Share:

Basic and Diluted (Loss) Per Share	$	(0.04	)	$	(0.02	)	$	(0.09	)	$	(0.05	)
Basic and Diluted Weighted Average Shares Outstanding		70,005,275			45,695,942			67,252,621			45,318,811

The Accompanying Notes are an Integral Part of These Unaudited Condensed Consolidated Financial Statements.

ADAMIS PHARMACEUTICALS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

	Nine Months Ended
		December 31, 2010			December 31, 2009
CASH FLOWS FROM OPERATING ACTIVITIES		(Unaudited)			(Unaudited)

Net Loss		$	(5,829,973	)	$	(2,178,380	)
Adjustments to Reconcile Net Loss to Net
Cash (Used in) Operating Activities:
Depreciation Expense			13,682			13,793
Beneficial Conversion Feature Interest			-			249,500
Stock Issued for Interest			777			-
Stock Issued for Research & Development Services			1,215,000			-
Reduction of Compensation Upon Forgiveness of Accrued Bonus			(129,977	)		-
Consulting Expense Paid in Common Stock			597,500			9,000
Amortization of Discounts			527,369			-
Inventory Reserve Adjustment			(222,878	)		16,791
Amortization of Stock Issued for Services			311,904			-
Stock-Based Compensation Expense			100,214			36,494
Sales Returns Reserve Adjustment			307,660			2,852
Change in Assets and Liabilities:
(Increase) Decrease in:
Accounts Receivable			5,555			(12,647	)
Inventory			225,587			7,991
Prepaid Expenses and Other Current Assets			2,394			20,100
Increase (Decrease) in:
Accounts Payable			(306,358	)		571,736
Accrued Expenses			123,301			561,759
Net Cash (Used in) Operating Activities			(3,058,243	)		(701,011	)

CASH FLOWS FROM INVESTING ACTIVITIES
Cash Acquired in Cellegy Pharmaceuticals Inc. Acquisition			-			65,114
Purchase of Property and Equipment			-			(4,888	)
Net Cash Provided by Investing Activities from Continuing
Operations			-			60,226
Net Cash Provided by Investing Activities from Discontinued Operations			150,000			-
Net Cash Provided by Investing Activities			150,000			60,226

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from Issuance of Note Payable			-			500,000
Proceeds from Issuance of Note Payable to Related Parties			-			234,800
Proceeds from the Issuance of Common Stock			5,395,000			500
Purchase of Treasury Stock			(4,127	)		(786	)
Payment of Notes Payable to Related Parties			(208,333	)		(10,000	)
Net Cash Provided by Financing Activities			5,182,540			724,514
Increase in Cash			2,274,297			83,729

Cash:
Beginning			290,299			17,697
Ending		$	2,564,596			101,426


The Accompanying Notes are an Integral Part of These Unaudited Condensed Consolidated Financial Statements.

ADAMIS PHARMACEUTICALS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

	Nine Months Ended December 31,
	2010		2009
	(Unaudited)		(Unaudited)
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash Paid for Interest	$	130,526	$	-

SUPPLEMENTAL DISCLOSURE OF NON-CASH FINANCING AND
INVESTING ACTIVITIES
Release of Share of Common Stock from Escrow	$	-	$	745
Common Stock Issued in Lieu of Interest	$	777	$	-
Notes Payable Converted to Common Stock	$	837,000	$	-
Stock-Based Compensation Expense	$	100,214	$	-
Accounts Payable Paid for in Common Stock	$	-	$	10,000
Accrued Bonuses Converted to Paid-in Capital	$	1,068,786	$	-
Increase in Capital from Beneficial Conversion Feature	$	-	$	249,500
Stock Issued as Discount on Note Payable	$	-	$	124,500
Stock Issued for Consulting Services	$	1,265,000	$	-
Stock Issued for Research & Development Services	$	1,215,000	$	-


The Accompanying Notes are an Integral Part of These Unaudited Condensed Consolidated Financial Statements.

Note 1: Basis of Presentation

The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Articles 8 and 10 of Regulation S-X promulgated by the Securities and Exchange Commission (“SEC”). Accordingly, certain information and footnote disclosures normally included in annual financial statements have been condensed or omitted. In the opinion of management, the accompanying unaudited interim condensed consolidated financial statements reflect all adjustments (including normal recurring adjustments and the elimination of intercompany accounts) considered necessary for a fair statement of all periods presented. The results of Adamis Pharmaceuticals Corporation operations for any interim periods are not necessarily indicative of the results of operations for any other interim period or for a full fiscal year. These unaudited interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended March 31, 2010.

Liquidity and Capital Resources

Our cash and cash equivalents were $2,564,596 and $290,299 at December 31, 2010 and March 31, 2010, respectively.

The Company has negative working capital, liabilities that exceed its assets and significant cash flow deficiencies. Additionally, the Company will need significant funding for future operations and the expenditures that will be required to market existing products and conduct the clinical and regulatory work to develop the Company’s product candidates. Management’s plans include seeking additional funding to satisfy existing obligations, liabilities and future working capital needs, to build working capital reserves and to fund its research and development projects. There is no assurance that the Company will be successful in obtaining the necessary funding to meet its business objectives.

Private Placement Financing Transaction

The Purchase Agreement provides for two potential subsequent closings (the “Milestone Closings”). At each Milestone Closing, the Purchaser has agreed to invest $2.5 million if the milestones relating to that Milestone Closing have been achieved and certain other customary closing conditions, including the absence of a material adverse event affecting the Company and the representations and warranties of the Company in the Purchase Agreement being true and correct as of the date of the Milestone Closing, are satisfied. The Purchase Agreement provides for a period of time, from January 1, 2011 through April 30, 2011, for satisfaction of the milestones.

Recent Accounting Pronouncements

In April 2010, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2020-17, “Revenue Recognition – Milestone Method (Topic 605); Milestone Method of Revenue Recognition” (codified within ASC 605 – Revenue Recognition) (“ASU 2010-17”). ASU 2010-17 provides guidance on defining a milestone and determining when it may be appropriate to apply the milestone method of revenue recognition for research and development transactions. ASU 2010-17 is effective for fiscal years beginning after June 15, 2010 and interim periods within those fiscal years, with early adoption permitted. The Company is currently assessing the impact of ASU 2010-17 on its future consolidated financial statements.

In December 2010, the FASB has issued ASU No. 2010-27, “Other Expenses (Topic 720): Fees Paid to the Federal Government by Pharmaceutical Manufacturers” (“ASU 2010-27”). ASU 2010-27 provides guidance on how pharmaceutical manufacturers should recognize and classify in their income statements fees mandated by the Patient Protection and Affordable Care Act as amended by the Health Care and Education Reconciliation Act (the Acts). The Acts impose an annual fee on the pharmaceutical manufacturing industry for each calendar year beginning on or after January 1, 2011. An entity’s portion of the annual fee is payable no later than September 30 of the applicable calendar year and is not tax deductible. A portion of the annual fee will be allocated to individual entities on the basis of the amount of their branded prescription drug sales for the preceding year as a percentage of the industry’s branded prescription drug sales for the same period. An entity’s portion of the annual fee becomes payable to the U.S. Treasury once a pharmaceutical manufacturing entity has a gross receipt from branded prescription drug sales to any specified government program or in accordance with coverage under any government program for each calendar year beginning on or after January 1, 2011.

Note 2: Asset Acquisition and Recapitalization

Cellegy Merger

The stockholders of Cellegy Pharmaceuticals, Inc. (“Old Cellegy”) and the former Adamis Pharmaceuticals Corporation (“Old Adamis”) approved a merger transaction and related matters at an annual meeting of Old Cellegy’s stockholders and at a special meeting of Old Adamis’ stockholders each held on March 23, 2009. On April 1, 2009, Old Cellegy completed the merger transaction with Old Adamis. In connection with the closing of the merger transaction, a promissory note issued by Old Cellegy to Old Adamis reflecting a loan made by Old Adamis to Old Cellegy in connection with the merger transaction was converted into shares of Old Adamis stock, and these shares were immediately cancelled.

In connection with the consummation of the merger and pursuant to the terms of the definitive merger agreement relating to the transaction (the “Cellegy Merger Agreement”), Old Cellegy changed its name from Cellegy Pharmaceuticals, Inc. to Adamis Pharmaceuticals Corporation (“Adamis” or the “Company”), and Old Adamis changed its corporate name to Adamis Corporation.

Pursuant to the terms of the Cellegy Merger Agreement, immediately before the consummation of the merger Old Cellegy effected a reverse stock split of its common stock. Pursuant to this reverse stock split, each 9.929060333 shares of common stock of Old Cellegy that were issued and outstanding immediately before the effective time of the merger were converted into one share of common stock and any remaining fractional shares held by a stockholder (after the aggregating fractional shares) were rounded up to the nearest whole share (the “Reverse Split”).

As a result, the total number of shares of Old Cellegy that were outstanding immediately before the effective time of the merger were converted into approximately 3,000,000 shares of post-Reverse Split shares of common stock of the Company. Pursuant to the terms of the Cellegy Merger Agreement, at the effective time of the merger, each share of Adamis common stock that was issued and outstanding immediately before the effective time of the merger ceased to be outstanding and was converted into the right to receive one share of common stock of the Company. As a result, the Company issued approximately 43,772,989 post-Reverse Split common stock, inclusive of 7,451,304 contingent shares held in escrow which were issuable to the holders of the outstanding shares of common stock of Old Adamis before the effective time of the merger. Old Adamis was the surviving entity and is a wholly-owned subsidiary of the Company.

Old Adamis security holders owned, immediately after the closing of the merger, approximately 93.5% of the combined company on a fully-diluted basis. Further, Old Adamis directors constitute a majority of the combined company’s board of directors and all members of executive management of the combined company were from old Adamis. Therefore, Old Adamis was deemed to be the acquiring company for accounting purposes and the merger transaction is accounted for as an asset acquisition recapitalization in accordance with accounting principles generally accepted in the United States. As a result, all of the assets and liabilities of Old Cellegy have been reflected in the financial statements at their respective fair market values and no goodwill or other intangibles were recorded as part of acquisition accounting and the cost of the merger is measured at the net liabilities acquired. Transaction costs amounting to $147,747 were expensed upon the merger. The financial statements of the combined entity after the merger reflect the historical results of Old Adamis prior to the merger and do not include the historical financial results of Old Cellegy prior to the completion of the merger. Stockholders’ equity and earnings per share of the combined entity after the merger have been retroactively restated to include the number of shares received by Old Adamis security holders in the merger with the offset to additional paid-in capital.

In connection with the closing of the merger, the Company amended its certificate of incorporation to increase the authorized number of shares of common stock from 50,000,000 to 175,000,000 and the authorized number of shares of preferred stock from 5,000,000 to 10,000,000.

Note 3: Common Stock

Old Adamis released the remaining 6,732,285 re-purchasable holdback shares related to Old Adamis' acquisition of Healthcare Ventures Group (the "HVG Acquisition") in April 2007 from escrow during the nine months ended December 31, 2009. These shares remained subject to contractual rights of repurchase and were treated as contingent consideration. As a result, no purchase price adjustment was recorded, the shares were recorded at par value, and the shares were considered anti-dilutive due to the outstanding repurchase options. During fiscal 2009, 1,438,039 of the restricted shares were transferred from a former officer of Old Adamis to employees, officers and directors. On August 14, 2009, the Company exercised its repurchase option and repurchased 785,686 shares of common stock at a total cost of $786 from a former officer of the Company. 200,000 shares of the 785,686 repurchased shares held as treasury stock were part of the earlier transfer of shares in fiscal 2009. On September 27, 2010, the Company repurchased 2,551,502 shares of common stock that were originally part of the holdback shares relating to the HVG Acquisition, pursuant to repurchase rights in stock restriction agreements with the holders of those shares, for an aggregate price of $2,551.50. During September 2010, the Company determined not to exercise its right of repurchase under the stock restriction agreements relating to 2,645,097 shares held by an officer and director of the Company, such person agreed not to seek any amounts for past compensation relating to approximately $77,000 of accrued bonus liability previously reflected on the Company's financial statements, and the accrued bonus liability was accordingly reduced on the Company's financial statements and included in additional paid-in capital, or compensation expense, accordingly.

On April 6, 2010 the Company entered into an agreement with a consultant to assist with the branding of the Company and its products. The Company issued 500,000 shares of its common stock, with a value of $100,000, for these services. The value was capitalized and is being amortized over the term of the agreement.

On May 1, 2010 the Company entered into a two year consulting agreement with a consultant for services pertaining to public relations. The Company issued 1,500,000 share of its common stock, with a value of $315,000, for these services. The value was capitalized and is being amortized over the term of the agreement.

On May 1, 2010 the Company entered into a consulting agreement with a consultant to assist the Company in its public relations efforts with investors and markets. As compensation, the Company issued 250,000 shares of its common stock, with a value of $52,000. The value was capitalized and is being amortized over the term of the agreement.

On May 4, 2010 the Company and a consultant agreed to terminate a consulting services agreement entered into on February 1, 2010. The Company paid the $70,000 owed under the agreement by issuing 350,000 shares of the Company's common stock. Further, the Company and Colby Pharmaceuticals reduced 200,000 shares, with a value of $80,000, from the 1,000,000 shares issued to Colby Pharmaceuticals as part of the license acquisition agreement between the Company and Colby Pharmaceuticals.

During the second fiscal quarter ended September 30, 2010, the Company issued 1,580,000 shares of common stock to a small number of sophisticated investors in financing transactions at a price of $0.25 per share, for gross proceeds of $395,000, as well as 400,000 shares of common stock to be issued for gross proceeds of $100,000. During the third fiscal quarter ended December 31, 2010, the stock to be issued was cancelled and the cash received was returned to the investors.

During the second fiscal quarter ended September 30, 2010 and the third fiscal quarter ended December 31, 2010, certain of the Gemini note holders exercised their conversion feature to convert their notes into shares of the Company's common stock. A total of approximately 4,188,893 shares were issued in the conversion of notes and accrued interest with a total converted amount of $837,779.

On July 21, 2010 the Company entered into an 18-month consultant agreement with a consultant for services pertaining to public relations. The Company issued 1,000,000 shares of its common stock, with a value of $200,000, for these services.

On September 27, 2010, the Company repurchased 1,575,000 shares of common stock pursuant to repurchase rights in stock restriction agreements from a former officer, for $1,575.

On October 16, 2010, the Company entered into an amendment to the Assignment, Assumption and Stock Acquisition Agreement dated February 24, 2010 with Colby Pharmaceutical Company, a privately held company. Under the amendment, Colby assigned and transferred to Adamis the license agreements relating to two potential prostate cancer drug candidates, named APC-100 and APC-200, in consideration for the issuance to Colby of 5,000,000 shares of Adamis common stock at a value of $1,215,000. Additionally, Adamis issued 1,250,000 shares each to two consultants for consulting services rendered to Adamis in connection with the intellectual property covered by the license agreements. Such services were valued at $607,500.

On November 10, 2010, the Company completed a private placement transaction (the “Financing”) pursuant to a Common Stock Purchase Agreement (the “Purchase Agreement”) and a Registration Rights Agreement (the “Registration Rights Agreement”). The Purchase Agreement provides for the sale of up to 40,000,000 shares of common stock of Adamis to a foreign institutional investor (the “Purchaser”), at a price of $0.25 per share, for up to $10 million of gross proceeds. An initial closing was held on November 10, 2010 pursuant to which the Company received $5,000,000 in gross proceeds and issued 20,000,000 shares of common stock.

Note 4: Stock Option Plans, Shares Reserved and Warrants

Old Cellegy’s stockholders approved a new 2009 Equity Incentive Plan (the “2009 Plan”), which became effective upon the closing of the merger with Old Cellegy. The 2009 Plan provides for the grant of incentive stock options, non-statutory stock options, restricted stock awards, restricted stock unit awards, stock appreciation rights, performance stock awards, and other forms of equity compensation (collectively “stock awards”). In addition, the 2009 Plan provides for the grant of performance cash awards. The aggregate number of shares of common stock that may be issued initially pursuant to stock awards under the 2009 Plan was 7,000,000 shares. The number of shares of common stock reserved for issuance automatically increase on January 1 of each calendar year, from January 1, 2010 through and including January 1, 2019, by the lesser of (a) 5.0% of the total number of shares of common stock outstanding on December 31 of the preceding calendar year or (b) a lesser number of shares of common stock determined by the Company’s board of directors before the start of a calendar year for which an increase applies.

On January 1, 2010 the total number of shares reserved for issuance under the 2009 Plan increased by 2,327,398 shares, to 9,327,398 shares. Subsequent to the December 31, 2010 quarter end the total number of shares under the 2009 Plan increased by 4,079,517 shares, to 13,406,915 shares effective January 1, 2011.

In August 2009, the Company issued warrants to purchase up to 600,000 shares of common stock to consultants retained to assist the Company in fund-raising efforts. The warrants have an exercise price of $0.25 per share, which is equal to the fair market value of the Company's common stock at the date of grant. The options have a five year term and expire on August 26, 2014.

In August 2009, the Company hired an employee, who was granted a stock option by the Company to purchase up to 250,000 shares of common stock. The stock option has an exercise price of $0.22 per share, which was equal to the fair market value of the Company’s common stock on the date of the grant. The stock option vests over a period of three years from the date of the grant, and expires on the tenth anniversary of the grant date of the option. The Company estimated that the stock option has a fair market value of $0.11 per share using the Black-Scholes valuation model. Management’s assumptions included in the model were volatility of 35.4%, a risk-free interest rate of 3.4% based on the 10-year Treasury Rate at the date of the grant and no dividends. The Company estimated a forfeiture rate of 5.5%. The Company recorded stock based compensation expense of $29,918 related to such stock options for the year-ended March 31, 2010. The balance of the options issued to the employee was accelerated by the Company resulting in an expense of $19,097 for the nine months ended December 31, 2010.

In October 2009, the Company issued warrants to purchase up to 200,000 shares of common stock to consultants retained to assist the Company in fund-raising efforts. The warrants have an exercise price of $0.29 per share, which is equal to the fair market value of the Company’s common stock at the date of grant. The warrants have a five year term and expire on October 26, 2014.

In September 2010, the Company issued options to purchase up to 625,398 shares of common stock to officers and non-officer employees. An officer received approximately 160,000 shares and two employees received approximately 300,000 and 170,000 shares, respectively. The stock options have an exercise price of $0.27 per share, which was equal to the fair market value of the Company’s common stock on the date of the grant. The stock options vest and are exercisable in full as of the date of the grant, and expire on the tenth anniversary of the grant date of the options. The Company estimated that the stock options have a fair market value of $0.12 per share using the Black-Scholes valuation model. Management’s assumptions included in the model were volatility of 31.7%, a risk-free interest rate of 2.6% based on the 10-year Treasury Rate at the date of the grant and no dividends. The options have a value of $75,048. The Company recorded stock based compensation expense of $55,868 related to such stock options for the nine months ended December 31, 2010. The officer and one of the employees relinquished their rights to accrued bonuses worth approximately $210,000.

In September 2010, the Company issued options to purchase up to 2,525,000 shares of common stock to officers and non-officer employees. The stock options have an exercise price of $0.27 per share, which was equal to the fair market value of the Company’s common stock on the date of the grant. The stock options vest over a period of three years from the date of the grant, and expire on the tenth anniversary of the grant date of the options. The Company estimated that the stock options have a fair market value of $0.12 per share using the Black-Scholes valuation model. Management’s assumptions included in the model were volatility of 31.7%, a risk-free interest rate of 2.6% based on the 10-year Treasury Rate at the date of the grant and no dividends. The options have a value of $303,000, which is to be expensed on a straight-line basis over the three-year vesting period commencing October 1, 2010. The Company recorded stock based compensation expense of $25,250 related to such options for the three and nine months ended December 31, 2010.

In September 2010, the Company released the restrictions of approximately 9,776,000 shares of common stock held by three officers and directors. The officers and directors relinquished their rights to accrued bonuses worth approximately $328,000, resulting in an increase to additional paid-in capital.

The following summarizes outstanding stock options at December 31, 2010:

	Number of Stock Options		Weighted Average Remaining Contractual Life	Weighted Average Exercise Price		Number of Stock Options Vested

Non-Plan Stock Options		100,714	2.85 Years	$	41.27		100,714

2009 Equity Incentive Plan		3,400,398	9.56 Years	$	.27		875,398

The following summarizes warrants outstanding at December 31, 2010:

	Warrant Shares	Exercise Price Per Share		Date Issued	Expiration Date
Biosyn Warrants	8,245	$	57.97 - 173.92	October 22, 2004	2013 - 2014
Old Adamis Warrants	1,000,000	$	0.50	November 15, 2007	November 15, 2012
Consultant Warrants	300,000	$	0.25	August 26, 2009	August 26, 2014
Consultant Warrants	270,000	$	0.20	January 29, 2010	January 29, 2015
Consultant Warrants	200,000	$	0.29	October 26, 2009	October 26, 2014
Various Investors	395,000	$	0.30	June 14, 2010 - September 15, 2010	June 14, 2015 - September 15, 2015

Total Warrants	2,173,245

The Company has reserved shares of common stock for issuance upon exercise at December 31, 2010 as follows:

Warrants			2,173,245
Non-Plan Stock Options			100,714

2009 Equity Incentive Plan			9,327,398
Total Shares Reserved			11,601,357

Note 5: Inventory

Inventory consists of the following:

	December 31, 2010			March 31, 2010
	(Unaudited)
Respiratory and Allergy Products	$	0		$	226,710
Less: Obsolescence Reserve		(0	)		(224,001	)

Respiratory and Allergy Products, Net		0			2,709
Pre-Launch epi Inventory		—			—

Inventory, Net	$	0		$	2,709

Note 6: Notes Payable

G-Max Trust Note

On December 29, 2009, the Company issued a Convertible Promissory Note (the “G-Max Note”) to The G-Max Trust (the “Investor”) in connection with a private placement to the Investor for gross proceeds of $500,000, and 500,000 shares of common stock of the Company at par value for gross proceeds of $500 as an inducement to enter into the agreement. The market value of the common stock on the date issued was $0.25 per share, for a total value of $125,000. A discount on the note payable of $124,500 was recorded as a result, and was amortized over the term of the G-Max Note. The stock was restricted for six months from the date issued. Amortization of the discount, which is included in interest expense, was $31,125 and $93,375 for the three and nine months ended December 31, 2010, respectively. At December 31, 2010, the discount was fully amortized and the net carrying value was $500,000.

Interest on the outstanding principal balance of the G-Max Note accrues at a rate of 10% per annum compounded monthly and is payable monthly commencing February 1, 2010. All unpaid principal and interest on the G-Max Note was extended in December 2010 to March 31, 2011 (the “Maturity Date”).

At any time on or before the Maturity Date, the Investor has the right to convert part or all of the principal and interest owed under the G-Max Note into common stock at a conversion price equal to $0.20 per share (subject to adjustment for stock dividends, stock splits, reverse stock splits, reclassifications or other similar events affecting the number of outstanding shares of common stock). The conversion feature is considered beneficial to the Investor due to the purchase of the discounted shares. The estimated value of the beneficial conversion feature was $249,500. The entire amount was recorded as interest expense upon issuance since the G-Max Note is convertible at any time. The effective annual interest rate of the G-Max Note is 84.8% after considering the discount and beneficial conversion feature.

Events of default under the Note include: (a) the Company fails to make payment of the principal amount of the G-Max Note when due and fails to cure the default within the permitted cure period; or (b) the Company fails in any material respect to comply with or to perform when due any other material term, obligation, covenant, or condition contained in the Note and fails to cure the default within the permitted cure period. In the event of a default by the Company, the Investor must provide the Company with written notice of default, and the Company will have five business days to cure the default. Upon an event of default that is not cured, the Investor may declare the entire unpaid amount owed under the G-Max Note immediately due, subject to the subordination provisions set forth in the G-Max Note. Upon the failure to pay the principal amount owed under the G-Max Note upon the final maturity date, the Investor, at its option, may charge default interest on the G-Max Note at a rate equal to the lesser of (i) 18% per annum and (ii) the maximum rate permitted under applicable usury or other laws.

The G-Max Note includes piggyback registration rights providing that at any time after December 29, 2010, if the Shares and the shares of common stock issuable upon conversion of the G-Max Note (together with the Shares, the “Transaction Shares”) cannot be sold without restriction pursuant to SEC Rule 144, then if the Company files a registration statement pursuant to the Securities Act of 1933, as amended (the “Act”) at any time on or before December 29, 2010, relating to an offering for the account of others under the Act of any of its equity securities (other than on Form S-4 or Form S-8 (each as promulgated under the Act) or their then equivalents), then the Company will promptly notify the Investor and will include in such registration and any related qualification under blue sky laws or other compliance, and in any underwriting involved therein, all Transaction Shares specified by the Investor. The Company will pay the registration fees relating to the inclusion of the Transaction Shares in the registration statement.

The G-Max Note includes subordination provisions providing that payment of principal, interest and any other amounts that may become due pursuant to the Note, and any other obligation that the Company may have to the Investor (“Subordinated Indebtedness”), is subordinated to the payment in full of all “Senior Indebtedness” of the Company, which is defined as any obligations of the Company outstanding on the date of the Note or created thereafter pursuant to any secured note of the Company and any agreements relating thereto, and that as between the Investor and any holder of Senior Indebtedness (a “Senior Lender”) the Senior Lender will hold a first priority lien in all collateral relating to the Senior Indebtedness. Until all of the Senior Indebtedness has been paid in full and the Senior Lender has released its lien in the collateral, the Investor may not, without the Senior Lender’s prior written consent, demand, receive or accept any payment, other than current interest payments, from the Company in respect of the Subordinated Indebtedness, or exercise any right of or permit any setoff in respect of the Subordinated

Indebtedness. The Note includes other customary subordination provisions, including provisions subordinating the Subordinated Indebtedness to any Senior Indebtedness in the event of bankruptcy or similar proceedings or events. In addition, if an event of default occurs with respect to any Senior Indebtedness permitting the holder to accelerate the maturity thereof, then, unless the event of default has been cured or waived or has ceased to exist, or all Senior Indebtedness has been paid in full, no payment may be made in respect of the Note for a period of 180 days after the first occurrence of such event of default.

Gemini Master Fund, Ltd. Notes

In January 2010, the Company completed the closing of a private placement financing transaction (the “January 2010 Financing”) with a small number of institutional investors led by Gemini Master Fund, Ltd., pursuant to a Securities Purchase Agreement. The Company issued 10% Senior Secured Convertible Notes (the “Notes”) in the aggregate principal amount of approximately $1.5 million and 1,500,000 shares of common stock (sold at par value) of the Company, and received gross proceeds of $1.5 million, excluding transaction costs and expenses. The fair market value of the Company's common stock on the date of the transaction was $ 0.41 per share. A discount of approximately $600,000 was calculated as a result, and was amortized over the life of the Notes. The stock was restricted for six months from the date issued. Amortization of the discount, which is included in interest expense, was $0 for the quarter ended, and $433,994, for the nine months ended December 31, 2010. At December 31, 2010, the discount was fully amortized and the carrying amount was $663,000 after conversions.

Interest on the Notes is payable at a rate of 10% per annum and is payable monthly on the first business day of each month. Principal and any accrued and unpaid interest was due and payable nine months after the date of the Notes. In December 2010 the note holders agreed to extend the maturity date to March 31, 2011. The existing terms and conditions of the notes remain the same during the extension. The Notes are convertible into shares of the Company’s common stock at any time at the discretion of the investor at an initial conversion price per share of $0.20, subject to adjustment for stock splits, stock dividends and other similar transactions and subject to the terms of the Notes. The conversion price is also subject to price anti-dilution adjustments providing that if the Company issues equity securities or securities convertible into equity securities at an effective price per share below the conversion price of the Notes (subject to certain exceptions), the conversion price of the Notes will be adjusted downward to equal the price of the new securities. The conversion feature is considered beneficial to the investors due to the purchase of the discounted shares. The estimated value of the beneficial conversion feature is approximately $2.2 million. The entire amount was recorded as interest expense upon issuance since the Notes are convertible at any time. The effective interest rate of the Notes is 210.4% after considering the discount and beneficial conversion feature.

The Company’s obligations under the Notes and the other transaction agreements are guaranteed by the Company’s principal subsidiaries, including Adamis Corporation, Adamis Laboratories, Inc. and Adamis Viral, Inc., and are collateralized by a security interest in all of the assets of the Company and those subsidiaries, pursuant to a Security Agreement.

The transaction agreements include restrictions on the Company’s ability to engage in certain kinds of transactions while the Notes are outstanding without the consent of two-thirds in interest of the Investors, including incurring or paying certain kinds of indebtedness, entering into certain kinds of financing transactions at prices below $.20 per share, or encumbering the Company’s assets. In addition to the rights under the Security Agreement to foreclose on the collateral in the event of a default, the transaction documents include a variety of liquidated damages, penalties and default provisions upon events of default by the Company, including without limitation an increase in the principal amount and interest rate and a potential decrease in the conversion price of the Notes, and in connection with certain other breaches of covenants of the Company. If the shares underlying the Notes are not freely tradable under SEC Rule 144, the Company intends to file a registration statement covering the resale of such shares.

In connection with the above, each officer and director of the Company was required to sign a lock up agreement covering their shares of Company common stock for the duration of the notes. The officers and directors agreed that during the restricted period, they will not (1) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, or otherwise transfer or dispose of, directly or indirectly, any of their shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock or (2) enter into any swap or other agreement that transfers, in whole or in part, any of the economic consequences of ownership of the Common Stock. The lock up will not apply in connection with an offer made to all shareholders of the Company in connection with any merger, consolidation or similar transaction involving the Company or the purchase (but not the sale) of Common Stock upon the exercise of options or warrants.

During July through December 2010, certain of the Gemini note holders exercised their conversion feature to convert their notes into shares of the Company's common stock. A total of approximately 4,188,892 shares were issued in the conversion of notes with a total converted amount of $837,778, including interest.

Notes Payable to Related Party

The Company had notes payable to a related party amounting to $101,232 at December 31, 2010, which bear interest at 10%. Accrued interest related to the notes was $51,031 at December 31, 2010.

Note 7: Legal Matters

In addition to the matters described below, we may become involved in or subject to, routine litigation, claims, disputes, proceedings and investigations in the ordinary course of business, which in our opinion will not have a material adverse effect on our financial condition, cash flows or results of operations.

Cosmo Bioscience, Inc. et. al. v. Adamis Pharmaceuticals Corp. and Maurizio Zanetti

Cosmo Bioscience, Inc. et. al. v. Adamis Pharmaceuticals Corp. and Maurizio Zanetti was filed in San Diego Superior Court in May 2010 and was stayed in November 2010. Plaintiffs are affiliated Cosmo Bioscience entities who claim to have sublicensed certain patented technology from Eurogen BV, an entity wholly owned and controlled by Maurizio Zanetti. Plaintiffs claimed that Zanetti wrongfully terminated their license, and further that Zanetti improperly licensed the same technology to Adamis in violation of plaintiffs’ exclusive license agreement. Plaintiffs asserted a single claim for declaratory relief seeking a declaration that the Cosmo sublicense was in full force and effect, and that the Adamis license is invalid. In a previous effort to assert claims with respect to the technology, one of the principals of Cosmo previously had claimed to be a co-inventor of the patents involved in the lawsuit – a claim which was rejected by a U.S. federal district court. On July 26, 2010, Zanetti filed a motion to compel arbitration on the ground that the license he signed with Cosmo specified that Italian courts and Italian law would govern the license. Also on that date, Adamis filed a motion to stay the litigation pending resolution of any Italian arbitration. Those motions were granted in favor of Zanetti and Adamis on November 22, 2010, and the Cosmo litigation now is stayed. Cosmo may seek arbitration in Italy. If it does, Adamis would likely not be a party to the arbitration because Adamis was not a party to the license agreement between Cosmo and Zanetti. If Cosmo seeks to arbitrate its claim in Italy, the findings of the arbitration would likely impact the Cosmo litigation. Even if the arbitration resulted in an outcome adverse to Adamis, Adamis believes that it has other defenses to plaintiffs’ claim, although there can be no assurances that this would be the case.

In addition, Adamis, through its counsel, has notified the Cosmo entities that it has reason to believe that Cosmo is engaging in activities that violate or interfere with Adamis’ rights to the technologies licensed to Adamis, and that any use of the technologies by Cosmo may be an unlawful infringement on the patents exclusively licensed to Adamis.

Curtis Leahy, et. al. v. Dennis J. Carlo, et al.

In May 2010, Curtis Leahy, et. al. v. Dennis J. Carlo, et al. was filed in San Diego Superior Court, and plaintiffs subsequently filed an amended complaint on June 18, 2010. The plaintiffs – Antaeus Capital Partners, Curtis Leahy, and David Amron – are Adamis shareholders, and they seek to represent a putative class of shareholders. The defendants named in the Complaint are Adamis, Dennis Carlo, David Marguglio, Robert Hopkins, and Richard Aloi, who are officers and/or directors of the Company. Plaintiffs’ first amended complaint alleged that defendants misrepresented and omitted material information in private placement memoranda distributed by Adamis in 2006 and 2008 regarding, among other things, Adamis’ license rights with respect to certain patented anti-viral technology; this claim appears to be based in part on the allegations of the Cosmo plaintiffs in the Cosmo lawsuit described above. Based on these purported misrepresentations and omissions, plaintiffs asserted claims for violations of Sections 25401, 25501, and 25504 of the California Corporations Code, and claims for common law fraud and negligent misrepresentation on behalf of a putative class of shareholders who purchased stock pursuant to either or both of the Company’s 2006 and 2008 Private Placement Memoranda. Plaintiffs sought damages amounting to the difference between the purchase price of their stock and the current share price, or the price at which they previously sold their stock.

Plaintiffs also alleged that defendants breached their fiduciary duties as directors and officers of Adamis with respect to certain corporate transactions, including the HVG transaction in 2007, the Cellegy merger in 2008, and the Gemini and G-Max financing transactions in fiscal 2010. Plaintiffs alleged that these transactions were not in the best interest of the Company and did not achieve their stated objectives. Plaintiffs further alleged that the director defendants collected excessive compensation in fiscal years 2008 and 2009, and asserted that the Company should have exercised its right to repurchase certain shares issued to defendants and other senior managers pursuant to the Stock Repurchase Agreements in 2008 rather than amend those agreements to extend the dates for meeting the applicable performance criteria. Based on these allegations, plaintiffs asserted claims for breach of fiduciary duty, unjust enrichment and constructive trust, declaratory relief, and injunctive relief. Believing that this complaint was without merit, defendants filed a demurrer and motion to strike. On October 22, 2010, in response to defendants’ demurrer, the San Diego Superior Court issued an order dismissing all of the plaintiffs’ claims other than the California Corporations Code claims related to the Company’s 2006 and 2008 private placement memorandums.

Plaintiffs filed a second amended complaint on November 30, 2010, re-asserting claims for violations of Sections 25401, 25501, and 25504 of the California Corporations Code, and claims for common law fraud and negligent misrepresentation on behalf of a putative class of shareholders who purchased stock pursuant to either or both of the Company’s 2006 and 2008 Private Placement Memoranda. Plaintiffs again seek damages amounting to the difference between the purchase price of their stock and the current share price, or the price at which they previously sold their stock. Plaintiffs also re-alleged their claim for breach of fiduciary duty and aiding and abetting breach of fiduciary duty, but agreed to dismiss this claim in its entirety during a meet and confer conference with counsel for defendants. The Company continues to believe that the second amended complaint is without merit, intends to defend against the remaining claims vigorously and may assert any available counterclaims. On December 23, 2010, defendants filed a motion to strike the portions of the second amended complaint discussing the securities lawsuit brought against Dennis J. Carlo in his capacity as an officer and director of Immune Response Corporation. The San Diego Superior Court heard this motion to strike on January 28, 2011, and denied the motion without prejudice. The court concluded that it could not find as a matter of law that the allegations relating to the securities lawsuit against Dr. Carlo were irrelevant and immaterial at this stage of the lawsuit. Defendants are currently scheduled to answer the second amended complaint by February 14, 2011. The court also held a case management conference and scheduled the hearing on plaintiffs' motion for class certification for June 24, 2011. A trial date has not yet been scheduled.

Agape World, Inc.

Agape World, Inc. is a company involved in an involuntary bankruptcy proceeding filed in 2009. Its principal, Nicholas Cosmo, was indicted and faces criminal trial on many counts of wire fraud and other claims, based on allegations that he operated a Ponzi scheme through Agape and other entities. More than one year before the date of this Report on Form 10-Q, the bankruptcy trustee of Agape contacted the Company by telephone, asserting that Agape World paid $1 million to the Company for 2 million shares of common stock of the Company, but that the stock was issued not to Agape World, but instead to Mr. Cosmo, a principal of Agape World, and claiming that this constituted a fraudulent transfer. The Company believes that the trustee has recovered the stock from the principal. The Company responded to the trustee denying any fraudulent transfer or any other basis for a claim by the trustee. There has been no further communication between the trustee and Adamis for more than one year, and no suit or any action has been filed against the Company. Management believes that the trustee has no basis for any fraudulent transfer or other claims against the Company. Due to the limited nature of discussions with Agape, the early stage of this matter and the facts in this case, the outcome of this matter cannot be determined at this time.

The litigation described in this section could divert management time and attention from the Company, could involve significant amounts of legal fees and other fees and expenses. An adverse outcome in any such litigation could have a material adverse effect on Adamis.

Note 8: Subsequent Events

On January 12, 2011, pursuant to provisions in the Company’s 2009 Equity Incentive Plan (the “Plan”) providing for an initial grant of stock options to persons who join the board of directors as non-employee directors, and in connection with their appointment as non-employee directors of the Company, the Company granted to each of Kenneth Cohen and Karen Klause a nonqualified stock option to purchase 50,000 shares of common stock. The exercise price for the options was the fair market value of the common stock on the date of grant. These initial grants will vest 50% on the grant date, with the balance vesting in equal monthly installments over a period of three years from the grant date.

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

This discussion of Adamis’ financial condition and results of operations contains certain statements that are not strictly historical and are “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995 and involve a high degree of risk and uncertainty. Actual results may differ materially from those projected in the forward-looking statements due to other risks and uncertainties that exist in Adamis’ operations, development efforts and business environment, the other risks and uncertainties described in the section entitled “Risk Factors” in the most recent Annual Report on Form 10-K, as amended, filed with the Securities and Exchange Commission, or the SEC, and the other risks and uncertainties described elsewhere in this report. All forward-looking statements included in this report are based on information available to Adamis as of the date hereof, and except as may be required under the Securities Exchange Act of 1934 and the rules and regulations promulgated thereunder, Adamis assumes no obligation to update any such forward-looking statements.

Overview and Recent Developments

Overview

Adamis Pharmaceuticals Corporation (“Adamis”) was founded in June 2006 as a Delaware corporation. Adamis’ subsidiaries include Adamis Corporation and Biosyn, Inc. Adamis Corporation has two wholly-owned subsidiaries: Adamis Viral Therapies, Inc. (biotechnology), or Adamis Viral; and Adamis Laboratories, Inc. (specialty pharmaceuticals), or Adamis Labs.

Through its Adamis Viral subsidiary, Adamis is focused on the development of patented, proprietary technologies for the potential treatment of human prostate cancer and other indications, as well as developing patented preventative and therapeutic vaccines for indications such as influenza, hepatitis B and C virus, human papilloma virus, and prostate cancer. Pursuant to an agreement entered into in February 2010, Adamis acquired three exclusive license agreements covering three small molecule compounds, named APC-100, APC-200 and APC-300, that Adamis believes may be promising small molecule anti-inflammatory drug candidates for the potential treatment of human prostate cancer (PCa). Under the agreement, the company that was the licensee under the agreements transferred and assigned all of its rights under the agreements to Adamis. The intellectual property covered by the agreements is licensed from the Wisconsin Alumni Research Foundation, or WARF. In 2006 and 2007, APC-100 and APC-200, respectively, received the National Cancer Institute's multi-year, multi-million dollar RAPID (Rapid Access to Preventative Intervention Development) Award. Adamis’ objective is to file an Investigational New Drug application, or IND, with the FDA during the first quarter of calendar year 2011, and to subsequently commence a Phase 1/2a prostate cancer clinical study relating to the APC-100 product for men who have failed-Androgen Deprivation Therapy, or ADT, assuming adequate funding and no unexpected delays.

Adamis also has rights to vaccine technology applicable for certain viral-induced diseases such as influenza, hepatitis B and C virus, known to be involved in hepatocellular carcinomas or human papillomavirus, which is known to be involved in head and neck squamous cell carcinomas, as well as prostate cancer. However, Adamis currently intends to focus initially on the development of one or more of the recently licensed prostate cancer product candidates, and as a result the timing of initiation of trials relating to viral vaccine product candidates is subject to uncertainty and the availability of sufficient funding, and there are no assurances concerning whether such a product will be developed or launched.

Adamis Labs is a specialty pharmaceutical company that Adamis acquired in April 2007. Adamis Labs has a line of prescription products in the anti-inflammatory, allergy and respiratory field. Adamis Labs also has an Epinephrine Injection USP 1:1000 (0.3mg Pre-Filled Single Dose Syringe) product, or the single dose PFS Syringe product, a pre-filled epinephrine syringe product for use in the emergency treatment of extreme acute allergic reactions, or anaphylactic shock. Additional product candidates in its product pipeline include a generic inhaled nasal steroid for the treatment of seasonal and perennial allergic rhinitis, and two other respiratory products (a generic HFA albuterol inhaler and a generic HFA beclomethsone inhaler).

Adamis’ Biosyn subsidiary has intellectual property relating to a microbicide contraceptive gel product candidate named Savvy® (C31G).

To achieve its goals, Adamis will need to raise a substantial amount of funding and make substantial investments in equipment, new product development and working capital.

Merger of Cellegy and Adamis; Change of Corporate Name

Effective April 1, 2009, Adamis completed a business combination transaction with Cellegy Pharmaceuticals, Inc., or Cellegy. The stockholders of Cellegy and the corporation that was formerly named Adamis Pharmaceuticals Corporation (now named Adamis Corporation), or Old Adamis, approved a merger transaction and related matters at an annual meeting of Cellegy’s stockholders and at a special meeting of Old Adamis’ stockholders each held on March 23, 2009. On April 1, 2009, Cellegy completed the merger transaction with Old Adamis. Before the merger, Cellegy was a public company and Old Adamis was a private company. Pursuant to the merger, Cellegy continued as the surviving issuer company in the transaction, and the stockholders of Old Adamis received shares of common stock of Cellegy in exchange for their shares of Old Adamis. In connection with the consummation of the merger and pursuant to the terms of the merger agreement relating to the transaction, Cellegy changed its name from Cellegy Pharmaceuticals, Inc. to Adamis Pharmaceuticals Corporation, and Old Adamis changed its corporate name to Adamis Corporation.

Recent Developments

Amendment to Colby Pharmaceutical Agreement. On October 16, 2010, Adamis entered into an amendment to the Assignment, Assumption and Stock Acquisition Agreement dated February 24, 2010 with Colby Pharmaceutical Company, a privately held company, relating to the APC-100, APC-200 and APC-300 product candidates. Under the original agreement, Colby assigned to Adamis the license agreement relating to the APC-300 compound, and the agreements relating to the APC-100 and APC-200 would be assigned upon satisfaction of certain conditions. Under the amendment, Colby assigned and transferred to Adamis the license agreements relating to APC-100 and APC-200 in consideration for the issuance to Colby of 5,000,000 shares of Adamis common stock. Additionally, Adamis issued 1,250,000 shares to each of David Alan Zarling, Ph.D., M.BA. and Anne Vallerga, M.A., Ph.D., for consulting services rendered to Adamis in connection with the intellectual property covered by the license agreements.

Employment Agreements. On November 9, 2010, the Company entered into employment agreements with its executive officers. The agreements provide for the employment of the following persons to the following positions: Dennis J. Carlo, Ph.D., President and Chief Executive Officer; David J. Marguglio, Vice President of Business Development; Robert O. Hopkins, Vice President of Finance and Chief Financial Officer; and Richard L. Aloi, President, Adamis Labs. Additional disclosure concerning the agreements is contained in the Report on Form 8-K that the Company filed with the SEC on November 12, 2010.

Private Placement Financing Transaction. On November 11, 2010, Adamis completed a private placement transaction (the “Financing”) pursuant to a Common Stock Purchase Agreement (the “Purchase Agreement”) and a Registration Rights Agreement (the “Registration Rights Agreement”), both dated as of November 10, 2010. The Purchase Agreement provides for the sale of up to 40,000,000 shares of common stock of Adamis to a foreign institutitonal investor (the “Purchaser”), at a price of $0.25 per share, for up to $10 million of gross proceeds. An initial closing was held on November 10, 2010 pursuant to which the Company received $5,000,000 in gross proceeds and issued 20,000,000 shares of common stock. The Purchase Agreement provides for two potential subsequent closings (the “Milestone Closings”). At each Milestone Closing, the Purchaser has agreed to invest $2.5 million if the milestones relating to that Milestone Closing have been achieved and certain other customary closing conditions, including the absence of a material adverse event affecting the Company and the representations and warranties of the Company in the Purchase Agreement being true and correct as of the date of the Milestone Closing, are satisfied. The two sets of milestones primarily relate to the telomerase prostate cancer technology and product candidate that the Company intends to in-license and to the Company’s APC-100 prostate cancer product candidate, and include completion of manufacturing the compound, filing an Investigational New Drug Application (IND) with the U.S. Food and Drug Administration to begin a clinical trial relating to the product candidate, and submission to an Institutional Review Board of the protocol relating to the planned trial for the product candidate. Additional disclosure concerning the terms of the Financing is contained in the Report on Form 8-K filed by the Company with the SEC on November 12, 2010.

PFS Syringe Product . As Adamis previously reported in quarterly reports, commercial launch of the single dose PFS Syringe product has been materially slowed by insufficient funding, and since at least April 1, 2010 Adamis had not had any revenues from sales of the PFS Syringe product, or other Adamis Labs allergy and respiratory products. At a time when Adamis was not engaged in any sales or marketing activities concerning the PFS Syringe product, was not receiving any revenues from sales of the product and, as previously disclosed, did not have funding to support such sales and marketing activities, in June 2010 the Company received a warning letter from the FDA indicating that Adamis should not market the PFS Syringe product without FDA marketing approval, should take prompt action to correct the violations cited in the letter including failure to have FDA marketing approval, and should respond within 15 days of the receipt of the letter. As noted above, at the time Adamis received the letter it was not engaged in marketing activities relating to the product. Adamis subsequently responded and met with the FDA, noted that a number of other epinephrine products have been marketed for many years without FDA marketing approvals, advocated for "fair play" in the market with other similarly situated epinephrine drug products that remain on the market without FDA marketing approval, and indicated its intention to submit an application for marketing approval once certain issues concerning the amount of fees applicable to such an application were resolved. In November 2010, the Company received a favorable determination from the Small Business Administration that Adamis qualified as a small business, which was one of the unresolved questions concerning the fees relating to the application for approval. Adamis has completed regulatory dossier relating to the syringe product, and once the remaining issues have been satisfactorily resolved, then absent other unexpected developments and assuming adequate funding Adamis intends to submit an application to the FDA for marketing approval of the product and intends to commercially market the product as soon as reasonably practicable after the FDA allows for marketing of the product. There can be no assurances that the FDA will ultimately grant marketing approval for the PFS Syringe product, or concerning the timing of filing a marketing application or obtaining any such FDA approval.

Manufacturing Agreement with Beximco. On December 1, 2010, Adamis announced the signing of a strategic manufacturing, supply, and product development agreement with Beximco Pharmaceuticals Ltd. Beximco is a leading manufacturer of pharmaceutical formulations and Active Pharmaceutical Ingredients (API's) in Bangladesh. Beximco has a large number of products covering broad therapeutic categories, including, but not limited to, asthma and allergy inhalers, antibiotics, anti-hypertensives, anti-diabetics, and anti-retrovirals. Beximco's manufacturing site houses a number of self-contained production units including oral solids, metered dose inhalers, intravenous fluids, liquids, ointments, creams, suppositories, ophthalmic drops, injectables and nebulizer solutions. Adamis and Beximco intend to introduce a number of separate drugs into the U.S. over the next years. The expected focus of these drugs will be in the areas of allergy and asthma. In addition, the companies intend to co-develop certain drugs, some of which Beximco currently produces for the European market. Adamis will be responsible for regulatory approval and sales in the U.S.

C31G/Savvy Product Candidate . On December 7, 2010, the Company announced the successful completion of a Phase 3 contraceptive trial of the Company's contraceptive gel product candidate named Savvy® (C31G). The study met its primary endpoint and was conducted by the Eunice Kennedy Shriver National Institute of Child Health and Human Development (NICHD), National Institutes of Health (NIH), in the Contraceptive Clinical Trials Network at 14 sites in the United States. The results of the NICHD study were published in December 2010 in Obstetrics and Gynecology. The Phase 3 trial was a randomized, double-masked, controlled comparator study to assess whether a gel containing the spermicide C31G was non-inferior to Conceptrol®, a commercially available product containing nonoxynol-9 (N-9). The clinical investigators found that C31G was not inferior in contraceptive efficacy to the comparator drug Conceptrol®. Thus, the study met its primary objective. Moreover, the gel was well-tolerated and had a high degree of acceptability in women who completed the study. No drug-related serious adverse events were observed with C31G. Drug-related side effects of C31G were generally mild and did not lead to discontinuation.

Currently, all spermicides commercially available in the U.S. contain the active ingredient N-9 in a carrier such as a gel, film, cream, foam, suppository, or tablet. N-9 has been reported in some studies to cause irritant and allergic reactions in some users. Although the Conceptrol® product was effective and well-tolerated in the NICHD comparative trial, there were a significantly lower number of drug-related events with the C31G gel and fewer women discontinued the study due to drug-related side effects. C31G does not contain nonoxynol-9 and, if commercialized, may offer an alternative for women who seek a non-hormonal method of contraception. C31G previously was the subject of two Phase 3 clinical trials conducted in Africa, supported by Family Health International and the United States Agency for International Development, to determine whether C31G was safe and effective for reducing women's risk of acquiring HIV infection. The external independent Data Monitoring Committee reviewing those trials concluded in 2005 and 2006 that, while there were no safety concerns based on the results of the studies to date, continuing the trials would not allow the effect of C31G on HIV acquisition to be determined because of a lower than expected rate of HIV seroconversion in the trials. The committee determined that continuation of the trials was not warranted due to a lack of statistical significance between C31G gel and the vehicle control in the interim data. Accordingly, the trials were discontinued.

Adamis will likely seek to enter into an outlicensing or similar transaction with organizations that have a focus or business unit in the area of contraception. The C31G product candidate is held by the Company’s Biosyn, Inc. subsidiary and was acquired in 2004 with Cellegy’s acquisition of Biosyn. Provisions in the acquisition agreement between Biosyn and Cellegy, and in certain of the funding agreements and other agreements relating to the C31G product, provide for payments to the former Biosyn shareholders and to third parties in the event of sales or other revenues relating to C31G. In addition, sale or outlicensing of the C31G product candidate may require the consent of one or more such third parties. Accordingly, there can be no assurances that we will be able to successfully conclude a transaction involving C31G or concerning the amounts that we might receive from any such transaction.

Amendment of Gemini Notes and G-Max Note. As previously disclosed, Adamis entered into a private placement financing transaction with a small number of institutional investors led by Gemini Master Fund, Ltd. Under the financing, the Company issued 10% Senior Secured Convertible Notes (the “Notes”) in the aggregate principal amount of $1.5 million, and 1,500,000 shares of common stock of the Company. The Notes are convertible into shares of the Company’s common stock at any time at the discretion of the investor at an initial conversion price per share of $0.20. Certain of these investors have elected to convert some or all of their Notes into common stock. On October 8, 2010, the Company and each of the investors entered into an amendment to the Notes pursuant to which the maturity date of all of the outstanding Notes was extended from October 11, 2010 to December 10, 2010. Effective December 9, 2010, the Company and each of the investors amended the Notes to extend the maturity date to March 31, 2011. Interest will continue to accrue and be paid on the outstanding Notes. No other changes were made to the Notes or agreements relating to the Notes, and all other provisions of the Notes and other agreements continue in full force and effect. Similarly, the maturity date of the Company’s $500,000 principal note to The G-Max Trust, originally entered into on December 29, 2009, was amended to extend its maturity date from December 29, 2010 to March 31, 2011.

Critical Accounting Policies and Estimates

The discussion and analysis of our financial condition and results of operations are based on our unaudited condensed consolidated financial statements, which have been prepared in accordance with United States generally accepted accounting principles. The preparation of these unaudited condensed consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. We evaluate our estimates on an ongoing basis. We base our estimates on historical experience and on other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ materially from these estimates under different assumptions or conditions.

The Company’s critical accounting policies and estimates previously disclosed in our Annual Report on Form 10-K for the year ended March 31, 2010 have not significantly changed, and except as previously disclosed, no additional policies have been adopted during the nine months ended December 31, 2010.

Recent Accounting Pronouncements

ASU 2010-27 specifies that the liability for the fee should be estimated and recorded in full upon the first qualifying sale with a corresponding deferred cost that is amortized to expense using a straight-line method of allocation unless another method better allocates the fee over the calendar year that it is payable. ASU 2010-27 is effective for calendar years beginning after December 31, 2010, when the fee initially becomes effective. The Company is currently assessing the impact of ASU 2010-17 on its future consolidated financial statements.

During December 2010, the FASB issued ASU 2010-29, “Business Combinations (Topic 805): Disclosure of Supplementary Pro Forma Information for Business Combinations” (“ASU 2010-29”). The amendments in ASU 2010-29 affect any public entity, as defined by Topic 805, “Business Combinations,” that enters into business combinations that are material on an individual or aggregate basis. ASU 2010-29 specifies that if a public entity presents comparative financial statements, the entity should disclose revenue and earnings of the combined entity as though the business combination(s) that occurred during the current year had occurred as of the beginning of the comparable prior annual reporting period only. The amendments also expand the supplemental pro forma disclosures to include a description of the nature and amount of material, nonrecurring pro forma adjustments directly attributable to the business combination included in the reported pro forma revenue and earnings. ASU 2010-29 is effective prospectively for business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2010. Early adoption is permitted. The Company is currently assessing the impact of ASU 2010-17 on its future consolidated financial statements.

Results of Operations

Nine Months Ended December 31, 2010 and 2009

Revenues and Cost of Sales . Adamis had revenues of $0 and approximately $351,000 for the nine months ending December 31, 2010 and 2009, respectively. The reduction in revenues for the first nine months of fiscal 2011 compared to the comparable period of last year was due to the result of the absence of sales of Adamis Labs products. The Company is not currently actively promoting its Aero line of products, due to funding limitations and the competitive market for antihistamine/decongestant products, with widespread substitution of generic products at the dispensing pharmacy level for the conditions indicated for the Adamis Labs products. Cost of sales for the nine months ending December 31, 2010 and 2009 were $0 and approximately $121,000, respectively. The difference was associated with the absence of revenues relating to the Adamis Labs products.

Research and Development Expense . Adamis incurred approximately $2,110,000 in research and development expenses for the nine months ended December 31, 2010 and approximately $151,000 for the nine month period ended December 31, 2009. The increase in research and development for the two comparative periods was caused by expenses relating to completion of the acquisition of the Colby license agreements and development of the acquired technology.

Selling, General and Administrative Expenses . Selling, general and administrative expenses for the nine months ending December 31, 2010 and 2009 were approximately $3,013,000 and $1,987,000, respectively. Selling, general and administrative expenses consist primarily of legal fees, accounting and audit fees, consulting fees, interest expense and employee salaries. The increase in comparative nine month period expense levels was primarily a result of increased consulting fees, legal/accounting fees, employee salary expenses and travel expenses. Increased legal/accounting fees were primarily due to the private placement transaction completed in November 2010. Salary expense increased compared to previous levels due to the increase in funding. The increased consulting fees were primarily a result of compensation expenses associated with entering into the public relations firms agreements.

Other Income (Expenses) . Interest expense for the nine month periods ending December 31, 2010 and 2009 was approximately $(712,000) and $(270,000), respectively. Interest consists primarily of interest expense paid in connection with various notes payable. The increase in interest expense for the nine month period ended December 31, 2010 in comparison to the same period for fiscal 2010 was due to interest expenses associated with the Gemini notes and the G-Max note.

Three Months Ended December 31, 2010 and 2009

Revenues and Cost of Sales . Adamis had revenues of $0 and approximately $119,000 for the three months ending December 31, 2010 and 2009, respectively. The reduction in revenues for the third quarter of fiscal 2011 compared to the comparable period of last year was due to the result of the absence of sales of Adamis Labs products. The Company is not currently actively promoting its Aero line of products, due to funding limitations and the competitive market for antihistamine/decongestant products, with widespread substitution of generic products at the dispensing pharmacy level for the conditions indicated for the Adamis Labs products. Cost of sales for the three months ending December 31, 2010 and 2009 were $0 and approximately $54,000, respectively. The difference was associated with the absence of sales of the Adamis Labs products.

Research and Development Expense . Adamis incurred approximately $2,093,000 in research and development expenses for the three months ended December 31, 2010 and approximately $52,000 in the three month period ended December 31, 2009. The increase in research and development expenses for the third quarter of fiscal 2011 compared to the comparable period of last year was primarily due to expenses relating to the completion of the acquisition of the Colby license agreements and development of the acquired technology.

Selling, General and Administrative Expenses . Selling, general and administrative expenses for the three months ending December 31, 2010 and 2009 were approximately $928,000 and $705,000, respectively. Selling, general and administrative expenses consist primarily of legal fees, accounting and audit fees, consulting fees and employee salaries. The increase in comparative three month period expense levels was primarily a result of increased consulting fees, legal/accounting fees, employee salary expenses and travel expenses. Increased legal/accounting fees were primarily due to the private placement transaction completed in November 2010. Salary expense increased compared to previous levels due to the increase in funding. The increased consulting fees were primarily a result of compensation expenses associated with entering into the public relations firms agreements.

Other Income (Expenses) . Interest expense for the three month period ending December 31, 2010 and 2009 was approximately $(72,000) and approximately $(258,000), respectively. Interest consists primarily of interest expense paid in connection with various notes payable. The decrease in interest expense for the three month period ended December 31, 2010 in comparison to the same period for fiscal 2010 was due to the beneficial conversion feature of $249,500 associated with the issuance of the G-Max notes issued December 2009. Interest during the three months ended December 31, 2010 related to continuous interest accruals related to notes payable, as well as amortization of the discount associated with the G-Max notes.

Liquidity and Capital Resources

Adamis’ cash was approximately $2,565,000 and $290,000 as of December 31, 2010 and March 31, 2010, respectively. The increase in cash compared to the end of fiscal 2010 was primarily the result of the receipt of funding from the November 2010 private placement transaction.

Net cash used in operating activities for the nine months ended December 31, 2010 and 2009 were approximately $(3,058,000) and $(701,000), respectively. Adamis expects net cash used in operating activities to increase going forward as it engages in additional product research and development activities, pursues additional expansion of its sales base and other business activities, assuming that it is able to obtain sufficient funding.

Net cash provided by investing activities was approximately $150,000 and $60,000 for the nine months ended December 31, 2010 and 2009. Results for the nine months ended December 31, 2010 were affected by proceeds received from new investors and the partial collection of an amount owed from discontinued operations.

Net cash provided by financing activities was $5,183,000 for the nine months ended December 31, 2010 and was approximately $725,000 for the nine months ended December 31, 2009. During the comparable nine month period in fiscal 2010, the Company received proceeds from related parties, while in 2011 we did not.

The Company’s financial position at December 31, 2010, was improved by the completion on November 10, 2010, of a private placement transaction with a foreign institutional investor. Pursuant to the transaction agreements, the Company received $5 million at an initial closing and issued 20 million shares of common stock. The transaction agreements provide for two potential subsequent closings, at which the purchaser has agreed to invest $2.5 million at each closing if the milestones relating to that closing have been achieved and certain other customary closing conditions are satisfied. For additional information concerning the transaction, please see the Company’s Report on Form 8-K filed with the SEC on November 12, 2010.

At December 31, 2010, Adamis had substantial liabilities and obligations, including without limitation obligations to the senior secured holders of the Gemini notes, under the G-Max note and to other noteholders. Even if development and marketing efforts are successful, substantial time may pass before significant revenues will be realized from product sales, and during this period Adamis may require additional funds, even if funds are provided at subsequent closings pursuant to the November 2010 financing transaction agreements. The availability of any required additional funding cannot be assured. Consequently, Adamis is subject to the risks associated with early stage companies, including the need for additional financings; the uncertainty of research and development efforts resulting in successful commercial products, as well as the marketing and customer acceptance of such products; unexpected issues with the FDA or other federal or state regulatory authorities; competition from larger organizations; reliance on the proprietary technology of others; dependence on key personnel; uncertain patent protection; and dependence on corporate partners and collaborators. To achieve successful operations, Adamis will require additional capital to continue research and development and marketing efforts. No assurance can be given as to the timing or ultimate success of obtaining future funding.

We prepared the condensed consolidated financial statements assuming that we will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities during the normal course of business. In preparing these condensed consolidated financial statements, consideration was given to the Company’s future business as described below, which may preclude the Company from realizing the value of certain assets. The Company has limited cash reserves, liabilities that exceed its assets and significant cash flow deficiencies. Additionally, Adamis will need significant funding for the future operations and the expenditures that will be required to market existing products and conduct the clinical and regulatory work to develop the Company’s product candidates. Management’s plans include seeking additional funding to satisfy existing obligations, liabilities and future working capital needs, to build working capital reserves and to fund its research and development projects. There is no assurance that Adamis will be successful obtaining the necessary funding to meet its business objectives.

Additional financing will be required to support sales and marketing efforts relating to product development and marketing efforts for the Adamis Labs products, continued product research and development on the Company’s cancer and vaccine technology, and to fund any product or company acquisition opportunities, and cash flow from the Adamis Labs’ operations are not expected to provide sufficient cash to fund Adamis’ overall cash requirements for the foreseeable future. Adamis’ future capital requirements will depend upon numerous factors, including the following:

	●	the progress and costs of development programs;
	●	the commercial success of new products that are introduced;
	●	patient recruitment and enrollment in future clinical trials;
	●	the scope, timing and results of pre-clinical testing and clinical trials;
	●	the costs involved in seeking regulatory approvals for product candidates;
	●	the costs involved in filing and pursuing patent applications and enforcing patent claims;
	●	future regulatory actions by the FDA and other regulatory agencies;
	●	the establishment of collaborations and strategic alliances;
	●	the cost of manufacturing and commercialization activities;
	●	the results of operations;
	●	the cost, timing and outcome of regulatory reviews;
	●	the rate of technological advances;
	●	ongoing determinations of the potential commercial success of products under development;
	●	the level of resources devoted to sales and marketing capabilities; and
	●	the activities of competitors.

To obtain additional capital when needed, Adamis will evaluate alternative financing sources, including, but not limited to, the issuance of equity or debt securities, corporate alliances, joint ventures and licensing agreements; however, there can be no assurance that funding will be available on favorable terms, if at all. There are no assurances that Adamis will be able to successfully develop its products under development or that its products, if successfully developed, will generate revenues sufficient to enable it to earn a profit. If Adamis is unable to obtain additional capital, management may be required to explore alternatives to reduce cash used by operating activities, including the termination of development efforts that may appear to be promising to Adamis, the sale of certain assets and the reduction in overall operating activities.

Off Balance Sheet Arrangements

At December 31, 2010, Adamis did not have any off balance sheet arrangements.

ITEM 3. Quantitative and Qualitative Disclosure of Market Risk

Not required.

ITEM 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our principal executive officer and principal financial officer, evaluated the effectiveness of our disclosure controls and procedures as of December 31, 2010. The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (“Exchange Act”), means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company’s management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on the evaluation of our disclosure controls and procedures as of December 31, 2010, our principal executive officer and principal financial officer concluded that, as of such date, the Company’s disclosure controls and procedures were not effective at the reasonable assurance level, for the reasons set forth in the Company's Annual Report on Form 10-K for the year ended March 31, 2010, under the heading “Item 9A(T) Controls and Procedures” relating to disclosure controls and procedures and internal controls over financial reporting, including without limitation the absence of independent board oversight in light of the fact that all directors of the Company as of December 31, 2010 were also officers of the Company, and the absence of finance and accounting personnel other than the Chief Financial Officer. Subsequent to December 31, 2010, the board of directors appointed new, non-employee independent directors to the board of directors, which the Company believes should help address one of the previously-identified weaknesses, the absence of non-employee directors on our board.

Changes in Internal Controls

No change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) occurred during the quarter ended December 31, 2010, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II - OTHER INFORMATION

ITEM 1. Legal Proceedings

Cosmo Bioscience, Inc. et. al. v. Adamis Pharmaceuticals Corp. and Maurizio Zanetti

Curtis Leahy, et. al. v. Dennis J. Carlo, et al.

Agape World, Inc.

ITEM 1A. Risk Factors

As a smaller reporting company, Adamis is not required under the rules of the Securities and Exchange Commission, or SEC, to provide information under this Item. Risks and uncertainties relating to the amount of cash and cash equivalents at December 31, 2010, are discussed above under the heading, “Liquidity and Capital Resources” in the Management’s Discussion and Analysis of Financial Condition and Results of Operations section of this Form 10-Q, and are incorporated herein by this reference. Developments relating to some of the risk factors disclosed in such Form 10-K are discussed in this Form 10-Q under the headings “Overview and Recent Developments – Recent Developments.” Other material risks and uncertainties associated with Adamis’ business have been previously disclosed in our most recent annual report on Form 10-K filed with the Securities and Exchange Commission, included under the heading “Risk Factors,” and those disclosures are incorporated herein by reference.

ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds

On October 16, 2010, the Company entered into an amendment to the Assignment, Assumption and Stock Acquisition Agreement dated February 24, 2010 with Colby Pharmaceutical Company, a privately held company. Under the amendment, Colby assigned and transferred to Adamis the license agreements relating to CPC-100 and CPC-200 in consideration for the issuance to Colby of 5,000,000 shares of Adamis common stock. Additionally, Adamis issued 1,250,000 shares each to the two consultants, for consulting services rendered to Adamis in connection with the intellectual property covered by the license agreements.

On November 10, 2010, Adamis completed a private placement transaction (the “Financing”) pursuant to a Common Stock Purchase Agreement (the “Purchase Agreement”) and a Registration Rights Agreement (the “Registration Rights Agreement”). The Purchase Agreement provided for the sale of up to 40,000,000 shares of common stock of Adamis to a foreign institutional investor (the “Purchaser”), Eses Holdings (FZE), a company located in the United Arab Emirates, at a price of $0.25 per share, for up to $10 million of gross proceeds. An initial closing was held on November 10, 2010 pursuant to which the Company received $5,000,000 in gross proceeds and issued 20,000,000 shares of common stock. The Purchase Agreement provides for two potential subsequent closings (the “Milestone Closings”). At each Milestone Closing, the Purchaser has agreed to invest $2.5 million if the milestones relating to that Milestone Closing have been achieved and certain other customary closing conditions, including the absence of a material adverse event affecting the Company and the representations and warranties of the Company in the Purchase Agreement being true and correct as of the date of the Milestone Closing, are satisfied. The securities were issued in a private placement transaction to a limited number of persons in reliance on Section 4(2) of the Securities Act of 1933, as amended, and/or Regulation D promulgated under the Securities Act.

During October, November and December 2010, certain of the Gemini note holders exercised their conversion feature to convert their notes into shares of the Company's common stock.

The securities issued to the two consultants relating to the Colby Pharmaceutical technology, and the stock options granted to the Company’s directors, were pursuant to the Company’s 2009 Equity Incentive Plan and a Form S-8 registration statement covering shares issued pursuant to the Plan. The shares of Common Stock issued and issuable in the Financing were issued in private placement transactions to a limited number of recipients in reliance on Section 4(2) of the Securities Act of 1933, as amended, and/or Regulation D promulgated under the Securities Act. Each person or entity to whom securities were issued represented that the securities were being acquired for investment purposes, for the person’s or entity’s own account, not as nominee or agent, and not with a view to the resale or distribution of any part thereof in violation of the Securities Act. The recipient also represented that it was an accredited investor as defined in Regulation D promulgated under the Securities Act.

ITEM 3. Defaults Upon Senior Securities

None

ITEM 4. (Removed and Reserved)

ITEM 5. Other Information

None

ITEM 6. Exhibits

Exhibit Number		Description
10.1		Form of Option Agreement for Non-Employee Directors. (1)
10.2		Form of Director and Officer Indemnity Agreement. (1)
10.3		2009 Equity Incentive Plan. (1)
10.4		Agreement and Plan of Share Exchange dated as of October 7, 2004, by and between the Company and Biosyn, Inc. (2)
10.5		Agreement dated as of October 8, 1996 by and among Biosyn, Inc., Edwin B. Michaels and E.B. Michaels Research Associates, Inc. (Confidential treatment has been requested with respect to portions of this agreement.) (3)
10.6		Patent License Agreement by and among Biosyn, Inc., and certain agencies of the United States Public Health Service. (Confidential treatment has been requested with respect to portions of this agreement.) (4)
10.7		Amendment to Assignment, Assumption and Stock Acquisition Agreement. (5)
10.8		Common Stock Purchase Agreement dated as of November 10, 2010, by and between Adamis and the Purchaser named therein. (Confidential treatment has been requested for portions of this Exhibit.) (6)
10.9		Registration Rights Agreement dated as of November 10, 2010, by and between Adamis and the Purchaser named therein. (Confidential treatment has been requested for portions of this Exhibit.) (6)
10.10		Employment Agreement between the Company and Dennis J. Carlo. (6)
10.11		Employment Agreement between the Company and David J. Marguglio. (6)
10.12		Employment Agreement between the Company and Robert O. Hopkins (6)
10.13		Employment Agreement between the Company and Richard L. Aloi. (6)
10.14		Form of Amendment to Ten Percent Senior Secured Convertible Notes. (7)
10.15		Amendment to G-Max Convertible Promissory Note. (7)
10.16		Product Development and Contract Manufacturing Agreement.
31.1		Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2		Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1		Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2		Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 .

(1)	Incorporated by reference to Exhibits filed with the Report on Form 8-K filed January 13, 2011.

(2)	Incorporated by reference to Exhibit 2.1 to the Form 8-K filed October 26, 2004.

(3)	Incorporated by reference to Exhibit 10.21 to the Form 10-K filed March 31, 2005.

(4)	Incorporated by reference to Exhibit 10.22 to the Form 10-K filed March 31, 2005.

(5)	Incorporated by reference to Exhibit 10.1 to the Form 8-K filed October 19, 2010.

(6)	Incorporated by reference to Exhibits filed with the Report on Form 8-K filed November 12, 2010.

(7)	Incorporated by reference to Exhibits filed with the Report on Form 8-K filed December 10, 2010.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		ADAMIS PHARMACEUTICALS, INC.


Date:	February 14, 2011	/s/ Dennis J. Carlo
		Dennis J. Carlo
		Chief Executive Officer


Date:	February 14, 2011	/s/ Robert O. Hopkins
		Robert O. Hopkins
		Vice President, Finance and Chief Financial Officer

Adamis Pharmaceuticals Corporation 10-Q

Exhibit 10.16

PRODUCT DEVELOPMENT &

CONTRACT MANUFACTURING AGREEMENT

Adamis Pharmaceuticals Corp., USA

and

Beximco Pharmaceuticals Ltd., Bangladesh

Page 1 of 23

This agreement is entered into on the 1st day of November, 2010

Between

BEXIMCO PHARMACEUTICALS LTD., a public limited company established according to the laws of the Peoples’ Republic of Bangladesh with its head office located at 17, Dhanmandi R/A, Road No. 2, Dhaka, Bangladesh (hereinafter referred to as BEXIMCO , which expression shall unless repugnant to the context shall include its successors and permitted assigns).

And

ADAMIS Pharmaceuticals Corp. , a company registered and established according to the laws of USA having its office at 2658 Del Mar Heights Rd. Suite 555, Del Mar, California, 92014, USA (hereinafter referred to as ADAMIS , which expression shall unless repugnant to the context shall include its successors and permitted assigns).

witnesseth as follows

whereas,

BEXIMCO is engaged in the manufacturing of pharmaceutical finished dosage forms and bulk raw materials (APIs) and marketing of those PRODUCTS both at home and abroad.

whereas,

ADAMIS is willing to authorize BEXIMCO to manufacture certain pharmaceutical products for the United States of America (USA) hereinafter referred to as the TERRITORY.

whereas,

BEXIMCO is interested to manufacture certain pharmaceutical products for ADAMIS in its facilities at Tongi, Gazipur, Bangladesh.

Now therefore, the parties in consideration, premises and covenants hereto agree as follows:

1. DEFINITIONS

1.1	In this Agreement (including the recitals above) the following terms will have the meanings set out below:

“ Certificate of Analysis ” is a document, which is signed and dated by a duly authorised representative of the manufacturer of a Product certifying that that Product conforms to the Product Specification;

“ Confidential Information ” will mean and include all information which may be disclosed by one party to the other party either pursuant to this Agreement including but not limited to information disclosed pursuant to clause 13.1 or pursuant to any preceding agreement concerning the Products, and any technology, marketing strategies and business of the disclosing party relating directly or indirectly to the Products but does not include information which the other party can show:

(a)	either is or becomes available to the public other than as a result of disclosure by the other party;

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(b)	at the time of receipt is already in the possession of the other party or becomes lawfully available to the other party on a non-confidential basis from a third party entitled to make that disclosure; or

(c)	is independently developed by the other party without reference to Confidential Information received hereunder, as evidenced by the other party's own records.

" Formulation " is the formulation of the Products;

" GMP " is the Code of Good Manufacturing Practice in the Territory, any requirements of the relevant regulatory authority in the Territory for the Marketing Authorisation, and the requirements of any GMP licence granted to a Manufacturer of a Product in the country of manufacture of the Products;

“ GMP Agreement ” is the agreement specified in Annexure 2;

" Independent Analyst " is an analyst qualified to analyse the Product and appointed by agreement between the parties;

“ Intellectual Property Rights ” includes all rights and interests, vested or arising out of any patent, copyright, design, trade mark, trade secrets, goodwill or Confidential Information rights whether arising by common law or by statute or any right to apply for registration under a statute in respect of those or like rights;

" Marketing Authorisation " is the grant of registration approval from the relevant regulatory authority in the Territory for the importation, storage, promotion, sale or other distribution of the Products;

“Products ” mean those Pharmaceutical Products with label, leaflet and carton as listed in Annexure-1 with indications to the generic name, pharmaceutical form and strength, and pack sizes. Such list may be amended from time to time on mutual agreement. The operations to be carried out by BEXIMCO under this Agreement shall be indicated next to the products.

“ Product Specification ” is, in relation to a Product, per Annexure 1;

“Quality Control” shall mean that part of GMP dealing with sampling, specifications, and testing as well as organization, documentation and release procedures. “ Term ” means the period of this Agreement described in clause 17.1;

“ Territory ” means the United States of America or USA and any other territory that may be subsequently agreed upon in writing by the parties, provided that the terms and conditions herein will apply with the necessary amendments being made to this Agreement.

1.2	In this Agreement, unless the context otherwise requires:

(a)

Headings and under linings are for convenience only and do not affect the interpretation of this Agreement;

(b)

Words importing the singular include the plural and vice versa;

(c)

Words importing a gender include any gender;

(d)

A reference to a part, clause, party, annexure, exhibit or schedule is a reference to a part, clause, party, annexure, exhibit or schedule to, this Agreement; and

(e)

A reference to a person includes any individual or individuals, corporation, partnership or other body, entity or other legal person.

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2	OBJECT OF THE AGREEMENT

2.1	Subject to the terms and conditions of this Agreement, BEXIMCO agrees to support commercialization of certain Products for ADAMIS and to contract manufacture these products for ADAMIS, listed in Appendix 1

2.2	The manufacturing of the Products shall be carried out at BEXIMCO’s premises at Tongi, Gazipur, Bangladesh.

3	PRODUCT DEVELOPMENT

3.1	For existing formulations of BEXIMCO, ownership will remain with BEXIMCO. For any newly developed formulation(s) ownership will be determined after mutual discussion.

3.2	BEXIMCO and ADAMIS will contribute their efforts and cooperate in activities related to assessment of regulatory issues, product definition and analysis relating to the Products for the Territory.

3.3	BEXIMCO will contribute its knowledge in development, regulatory, pharmaceutical / laboratory science and manufacturing capabilities necessary to commercialize the Products.

3.4	BEXIMCO will provide for and oversee raw materials and primary packaging materials (where applicable) sourcing, manufacturing, and provide contract management for suppliers.

3.5	ADAMIS will conduct or oversee clinical research studies, product testing necessary to obtain market clearance/regulatory approvals for Products, and additional indications as applicable.

3.6	ADAMIS will ensure all Intellectual Property, regulatory and registration requirements are satisfactorily addressed for the Territory.

3.7	When a third party involvement is necessary, such involvements will be discussed mutually, including costs sharing matters and needs to be approved by both BEXIMCO & ADAMIS.

4.	MARKETING AUTHORISATION

4.1

ADAMIS will be responsible for the regulatory dossier development, USFDA interactions including filings. Beximco will be responsible for site inspections required by the FDA or other governing body. Adamis will require support and data from Beximco to complete the dossier. Adequate support will be provided by Beximco at agreed upon rates.

4.2	ADAMIS will be responsible for the payment of annual fees and charges payable in respect of receiving and maintaining the Marketing Authorisations for the Products and other costs related to any variation of a Marketing Authorisation for the Products.

4.3	BEXIMCO warrants that all information supplied to ADAMIS in relation to the Products is true to the best of BEXIMCO’s knowledge after all due enquiries and that it is legally entitled to supply this information to ADAMIS.

4.4	BEXIMCO warrants that BEXIMCO will maintain any GMP licence granted to it under any scheme in the United States of America or Australia or any scheme recognised by the USFDA and will use reasonable endeavours to promptly provide ADAMIS with evidence of this when requested by ADAMIS to do so.

Page 4 of 23

5.	PRICE AND PAYMENT

5.1	ADAMIS will bear the expense of regulatory filings including any clinical studies performed for the purpose of obtaining regulatory clearance or approval for marketing of the Products. This may be decided on a product by product basis

5.2	ADAMIS will bear the expense of all studies and development activities required for the purpose of obtaining regulatory clearance or approval for marketing of the Products in the Territory. However, this agreement may change with changes to individual product agreements.

5.3	In the case of newly formulated drug products i.e., truly novel formulations, BEXIMCO will bear cost and retain ownership of any patent specific to the drug unless parties agree to a separate development and cost-sharing agreement pertaining to such new drug(s).

5.4

ADAMIS and BEXIMCO will agree on a transfer price (CIF) for the Products supplied on a contract manufacturing basis. ADAMIS shall open irrevocable Letter of Credit at sight in favor of BEXIMCO, payable at 30 days from the date of the shipment for required Products as per mutually agreed price list and BEXIMCO would supply to ADAMIS the Products in accordance with the irrevocable letter of credit opened by ADAMIS.

5.5	Any price change with respect to a Product will be determined by written agreement between the parties following an annual review of prices.

5.6	ADAMIS will pay for any royalties from the utilization of any third parties formulation/Intellectual Property or Patents (if necessary).

5.7	Title in respect of the Products shipped under this Agreement shall pass from BEXIMCO to ADAMIS upon BEXIMCO’s receipt of full payment in respect thereof and risk in the Products will pass on delivery.

SUPPLY

6.1	BEXIMCO will maintain stocks of Products as agreed upon by both parties.

6.2

After the grant of the Marketing Authorisation by USFDA, ADAMIS will provide BEXIMCO with an initial schedule of its anticipated requirements for the Products for the remainder of the then current calendar year and thereafter on an annual basis for each succeeding calendar year by 30 September, provided however that ADAMIS may provide BEXIMCO with amendments to any such schedule on a quarterly basis. Such schedules are estimates only and do not constitute firm orders. ADAMIS shall have the right to revise the forecast in accordance with the market situation informing BEXIMCO, 90 days in advance. But any firm order, for which Beximco has already commenced manufacturing, cannot be cancelled and will be paid for in full by ADAMIS.

6.3

ADAMIS will place written orders for the Products with BEXIMCO, specifying quantities (which must be in accordance with the batch sizes for a Product set mutually by both parties), Product Mix and delivery dates (not being less than 90 days in advance and preferably no less that 120 days in advance) and BEXIMCO will be deemed to have confirmed these if advice to the contrary, in writing, is not received by ADAMIS within 10 days. After confirmation by BEXIMCO, ADAMIS shall not be entitled to cancel such written orders but may reschedule if Beximco has not commenced manufacturing of the batch.

6.4	BEXIMCO will use its reasonable endeavours to supply or arrange the supply of the ordered quantities of Products by the confirmed delivery dates.

6.5	The supply of the Products will be CIF to a single location point in USA as specified at the time of ordering.

Page 5 of 23

6.6	ADAMIS will bear all expenses related to tax, customs clearance, storage, transportation, maintenance and delivery of PRODUCTS in the Territory.

6.7	In case of any adverse conditions affecting the supply or delivery of any Products to ADAMIS, BEXIMCO will immediately inform ADAMIS of the same and ADAMIS shall grant reasonable time for BEXIMCO to supply the Products.

6.8	BEXIMCO will supply a Certificate of Analysis with each delivery of the Products.

7.	MANUFACTURE, TRANSPORT, STORAGE AND DISTRIBUTION OF THE PRODUCTS

7.1	BEXIMCO warrants that all quantities of the Products supplied by BEXIMCO to ADAMIS pursuant to this Agreement will:

(a)

Conform in all respects to the Product Specification; and

(b)

Be of merchantable or satisfactory quality; and

(c)

Upon delivery at Bangladesh port, have a shelf life, which is at least 75% of the longest registered shelf life for the Products in the Territory.

7.3	BEXIMCO and ADAMIS agree to execute the GMP Agreement after the execution of this Agreement. Said Agreement will be attached hereto as Annexure 2.

7.4	BEXIMCO will supply ADAMIS with adequate written directions concerning suitable conditions for storage and transportation of the Products and ADAMIS represents it will store and transport the Products materially in accordance with those directions.

7.5	If the Product is to be supplied unpackaged, BEXIMCO will supply ADAMIS with adequate written directions concerning the packaging of the Products and ADAMIS represents it will materially accord with those directions and pack the product at a USFDA approved facility.

7.6	In the event that either of the parties becomes aware of any defect in the Products or that the Products are unsuitable for the use designated in the Market Authorisation, it will immediately notify the other party and provide them with a full disclosure of that defect or unsuitability.

7.7

ADAMIS assumes all risk of loss and indemnifies and holds harmless BEXIMCO and its employees, agents successors and assigns from and against any and all loss, liability, damage, fee, cost, expense, suit, claim, demand, judgement and prosecution directly or indirectly arising from or incidental to or resulting solely from the storage and distribution and sale of the Products by ADAMIS or its employees, agents successors and assigns EXCEPT where such liability arises out of the Formulation, the manufacture of the Products or the storage of the Products by ADAMIS in accordance with the written directions detailed in clause 7.4.

7.8

Notwithstanding clause 7.7, where any defect or unsuitability in the Products arises either partially or wholly as a result of a defect or unsuitability in raw material supplied to BEXIMCO by a third party, BEXIMCO will use its reasonable endeavours to have the third party conform to any demands of the regulatory authority concerning the defect.

7.9

BEXIMCO will not assume any risk of loss, liability, damage, fee, cost, expense, suit, claim, demand, judgement and prosecution directly or indirectly arising from or incidental to any defect or unsuitability in the Product arising either partially or wholly as a result of tampering by any person after delivery to ADAMIS’s nominated warehouse.

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8.	MARKETING AND OTHER RELATED DUTIES OF THE PARTIES

8.1	ADAMIS will plan and execute product launch and ongoing marketing activity, including introduction into wholesale distribution channels, detailing to pharmacies and clinicians, and marketing to managed care organizations, government entities, and other payors.

8.2	ADAMIS will arrange for co-promotion and/or license to sub-distributors as desirable in the judgment of ADAMIS management, in consultation with BEXIMCO for the purpose of expanding the market presence or ability to reach specific physician specialties.

8.3	ADAMIS will put efforts to evaluate market opportunity for the Products, including defining candidate medications, defining marketing strategy, including identifying targeted clinical indications, product naming and branding strategy, and product pricing, promotion and sales strategy.

8.4	ADAMIS shall make no representation to any person about the Products that is false or misleading in any material particular. In no event will the ADAMIS make any representation beyond those contained in the Product claims or supporting material supplied by BEXIMCO.

8.5

Each party warrants that it has in place from a reputable insurer product liability insurance covering the party’s respective products with limits of not less than $5 million USD in aggregate. Requirements for insurance levels will increase as products are introduced and approved for marketing and sales in the US. Insurance requirements should be reviewed on an annual basis by each party. Each party shall promptly deliver a certificate of insurance to the other party upon the other party’s written request. Further, a party shall, during the Term of this Agreement, promptly notify the other party of the cancellation or lapse of said insurance. If the party fails to rectify the same within thirty (30) calendar days after notice from the other party, any such failure shall be deemed a material breach of this Agreement.

9.	ADVERSE DRUG EVENTS

9.1	The obligations of the parties for when an adverse drug event occurs are set out in Annexture 3.

10.

RECALLS

10.1

If a law applicable in the Territory requires that any quantity of the Products should be recalled by ADAMIS for any reason, ADAMIS will give to BEXIMCO written notice of its intention to recall that quantity and specify its reasons for the need to carry out the recall, including by providing copies of documents of a competent Authority requiring the recall.

10.2	If within 7 days of the receipt of the notice the parties are unable to agree upon the need to carry out the recall, the parties agree to submit a sample of the Product to an Independent Analyst for a report. The determination of the Independent Analyst shall be binding upon the parties.

10.3	The cost of the report of the Independent Analyst will be paid by the party against which the report is unfavourable.

10.4	Notwithstanding clauses 10.1 to 10.3, ADAMIS may recall that quantity of Products at any time and will administer any such recall in the Territory at its own cost.

10.5

Notwithstanding anything to the contrary herein, in the event that the sole reason for recall of the Products is that the Products do not conform with the Product Specification due to storage or transport of the Products by ADAMIS or its affiliates or delegates which is not in accordance with the written directions given to ADAMIS under clause 8.4, then ADAMIS will be liable for the cost of the recall and any replacement quantities of Products.

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11.	WARRANTIES AND LIABILITIES

11.1	BEXIMCO warrants that at the time of delivery all Product manufactured and supplied under this Agreement shall meet the Specification, be manufactured and supplied in accordance with cGMP and will be free of defects in material and workmanship.

11.2

With regard to the Product, ADAMIS’s sole remedy for breach of the warranty in clause 11.1 above shall be at ADAMIS’s determination either a full refund or that BEXIMCO will as soon as is reasonably practicable, and without charge to ADAMIS, repair or (at BEXIMCO’s option) replace Products which are proven to the reasonable satisfaction of BEXIMCO to not conform with the Specification. This obligation will not apply where:

(a)

The Products have been improperly altered in any way whatsoever, or have been subject to misuse or unauthorized repair;

(b)

Any instructions as to storage of the Products have not been complied with in all respects; or

(c)

ADAMIS has failed to notify BEXIMCO in writing of any defect or suspected defect within 30 days of delivery of Products.

11.3

BEXIMCO agrees to indemnify ADAMIS from and against all losses, claims, demands, cost (including any costs incurred from return of defective Products) and other reasonable legal fees incurred by ADAMIS or arising from any injury to any person as a result of any breach by BEXIMCO of the warranty in clause 11.1, provided that ADAMIS (i) promptly gives BEXIMCO written notice of such claim, (ii) neither negotiates nor makes any settlement of nor makes any admission in relation to such claim and (iii) provides reasonable assistance (at BEXIMCO’s cost) to BEXIMCO to defend or settle such claim.

11.4	BEXIMCO does not exclude its liability (if any) to ADAMIS:

(a)

For personal injury or death resulting from BEXIMCO’s negligence;

(b)

For any matter for which it would be illegal for BEXIMCO to exclude or to attempt to exclude its liability; or

(c)

For fraud.

11.5

Except as expressly provided otherwise in clause 11.2 , BEXIMCO will be under no liability to ADAMIS whatsoever (whether in contract, tort (including negligence), breach of statutory duty, restitution or otherwise) for any of the following losses or damage (whether such losses or damage were foreseen, foreseeable, known or otherwise): loss of revenue, loss of actual or anticipated profits (including for loss of profits on contracts), loss of the use of money, loss of anticipated savings, loss of business, loss of opportunity, loss of goodwill, loss of reputation, loss of, damage to or corruption of data, or any indirect or consequential loss or damage howsoever caused.

11.7

The aggregate liability of BEXIMCO to ADAMIS with respect to all claims arising out of this Agreement with the exception of any claims made pursuant to clause 11.3 (or the subject matter hereof) during any period of 12 months either (a) during the period of this Agreement, and/or (b) after the termination or expiration of this Agreement, shall be limited to damages not exceeding the purchase price paid by ADAMIS for Products in 12 months preceding the date of any claim.

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11.8

Except as set out in clause 11.1 , BEXIMCO hereby excludes to the fullest extent permissible by law, all conditions, warranties and stipulations, express (other than those set out in this Agreement) or implied, statutory, customary or otherwise which, but for such exclusion, would or might subsist in favour of ADAMIS.

12.	INSPECTION OF THE PLANT

12.1

Up to two employees of ADAMIS or its authorised representatives will have the right, upon giving reasonable notice to BEXIMCO, to visit BEXIMCO's manufacturing plant in respect of Products specified in Annexure 1. Unless for cause, ADAMIS may visit BEXIMCO’s manufacturing plant once a year for a maximum of two days each during normal business hours. During any such visit, ADAMIS will have the right to:

(a)

Inspect the manufacturing facilities;

(b)

Inspect quality control procedures; and

(c)

Inspect records and reports pertinent to the manufacture, quality control or transport of those of the Products manufactured by BEXIMCO.

12.2	BEXIMCO will permit the inspection by any relevant regulatory authority of the Territory, which is required, as part of the Marketing Authorisation, including the inspection of:

(a)

The manufacturing facilities;

(b)

Quality control procedures; and

(c)

Records and reports pertinent to the manufacture, quality control or transport of those of the Products manufactured by BEXIMCO

12.3	BEXIMCO warrants that for the duration of the Agreement, its manufacturing facilities for the Products comply with the regulatory requirements for the Marketing Authority of the Territory and GMP.

12.4

If in the manufacture of any of the Products BEXIMCO uses raw material supplied from a third party or sources Products from a third party, BEXIMCO will use all reasonable commercial endeavours to procure the agreement of that third party to permit the inspection by any relevant regulatory authority of the Territory, which is required as part of the Marketing Authorisation, including the inspection of the third party’s:

(a)

Manufacturing facilities;

(b)

Quality control procedures; and

(c)

Records and reports pertinent to the manufacture, quality control or transport of the Products

13.	TRADE MARKS

13.1	If providing Product in packaged form, BEXIMCO will apply a trademark nominated by ADAMIS to such Product according to the directions and specifications provided by ADAMIS from time to time.

13.2	Other than as set out in this clause 12, BEXIMCO makes no warranty or representation in relation to the Intellectual Property Rights contained in the Products and any prior statements or representations are hereby revoked.

Page 9 of 23

13.3

ADAMIS shall be solely responsible for its trade marks applied to Products or packaging of Products according to clauses 12.5 and ADAMIS indemnifies and shall keep indemnified BEXIMCO from and against any and all claims, liabilities, costs (on an indemnity basis) expenses, damages by any third party making any allegation concerning such trade marks.

14.	CONFIDENTIALITY

14.1	Each of the parties will not, unless specifically authorised by the other party or by this Agreement:

(a)

Disclose any Confidential Information of the other party to a third party;

(b)

Make use of any Confidential Information of the other party for any purpose other than for the purposes set forth in this Agreement; or

(c)

Make, or allow anyone else to make, copies of any Confidential Information of the other party unless for the purposes set forth in this Agreement.

14.2	Each of the parties will:

(a)

Use its best endeavours to prevent unauthorised disclosure of the Confidential Information of the other party, by its employees; and

(b)

Restrict the disclosure of the Confidential Information of the other party to only those of its employees or employees of its affiliates or delegates who require the Confidential Information for the purposes of fulfilling that party’s obligations under this Agreement and to the relevant regulatory authority in the Territory.

14.3

Subject to clause 13.4, all Confidential Information, whether in permanent or magnetic/computer disk form or any other form will be returned to the party who disclosed the Confidential Information within 30 days of being requested to do so. However ADAMIS shall have no obligation pursuant to clause 13.3 if the return of Confidential Information would result in ADAMIS’s inability to exercise any of its valid rights pursuant to this Agreement including but not limited to the sale of Products.

14.4	Each party may:

(a)

Provide one copy of the Confidential Information to its legal advisers, to be held by them solely for the purpose of determining the scope of that party’s obligations under this clause; and

(b)

Retain one copy of such of the Confidential Information that is required: in order to maintain its obligation of confidence described herein; or by the relevant authorities in the Territory, to be retained by that party.

15.

ACCOUNTS

15.1	ADAMIS and BEXIMCO will keep proper books of account and records (including stock records) clearly recording all matters and transactions relating to the Products, and stocks of the Products, held from time to time.

16.	REPRESENTATION AND WARRANTS OF THE AGREEMENT

16.1	The parties hereto agree and acknowledge each with the other that, each of the parties hereto has entered into this Agreement in reliance on the representations and warranties of the other party in the following terms, and each party hereby accordingly warrants and represents that:

Page 10 of 23

16.2	It is duly incorporated with limited liability and validly existing under the laws of the country in which it is incorporated and has the power to own its own assets and to conduct the business which it conducts;

16.3	It has power under its constitution to enter into this Agreement in connection therewith and to exercise its rights and perform its obligations there under;

16.4

That all corporate or other actions required to authorize the execution and performance by it of its obligations under this Agreement has been duly taken, including the obtaining of all consents or approvals of, or exemptions by, any state, governmental or public bodies and authorities whether required in Bangladesh or otherwise;

16.5

The signing and delivery of this Agreement and the performance of any of the transactions contemplated hereunder will not contravene or constitute a default under any provision contained in any agreement, instrument, law, judgment, order, license, permit or consent by which it is bound or affected; and

16.6

All acts, conditions and things required by the laws of Bangladesh to be carried out, fulfilled and performed in order to ensure that its obligations under the Agreement are legal, valid and enforceable and to make the Agreement admissible in evidence in Bangladesh have been carried out, fulfilled and performed in strict compliance with the laws of Bangladesh.

17.	EXECUTION OF THE AGREEMENT

17.1	This agreement shall come into force immediately upon signature by the parties concerned. This Agreement shall be for a term of 5 (Five) years and will be renewed automatically for 5 (Five) years unless either party notifies the other of its intention not to renew the same.

18.	TERMINATION OF THE AGREEMENT

18.1	This agreement may be terminated by either of the parties by providing 3 (three) months’ prior written notice.

18.2

On the occurrence of an Event of Default as defined hereunder, the non-defaulting party shall serve a notice of default on the defaulter requesting it to cure the breach within 15 (fifteen) days from the date of the notice, failing which the non-defaulter shall be entitled forthwith to terminate this Agreement.

18.3	If the Event of Default is cured, the notification letter becomes null and void. If the Event of Default is not curable, then the non-defaulting party shall be entitled to terminate this Agreement upon serving 7 (seven) days’ notice.

18.4	An Event of Default shall occur on following:

(a)	A breach of any terms of this Agreement;

(b)	A breach in payment obligation under this Agreement;

(c)	Any representation or warranty under this Agreement proving to be incorrect and such representation or warranty having an adverse effect on the party’s ability to perform its obligation therein;

(d)	Ceases to function as a going concern or conduct its operations in the normal course of business;

(e)	Is declared bankrupt, insolvent or is subject to an order of the court for attachment of its asset, including and not limited to suspension of operation of business/bank accounts;

(f)	Is subject to winding up proceeding whether voluntary or involuntary or an order of the court has been made for appointment of liquidator or receiver to manage the assets/affairs of such party; or

Page 11 of 23

18.5	Upon termination of this agreement for any reason whatsoever the parties shall:

(a)

Settle all outstanding dues up to the date of termination of this Agreement between the parties hereto within 30(thirty) days of the termination.

(b)

ADAMIS shall return to BEXIMCO all documents and any other materials related to PRODUCTS or to this Agreement as may have been supplied by BEXIMCO within 30 (thirty) days, except for those documents which they are required to retain according to the law of the country

BEXIMCO shall return to ADAMIS all documents and any other materials related to PRODUCTS or to this Agreement as may have been supplied by ADAMIS within 30 (thirty) days, except for those documents which they are required to retain according to the law of the country

(c)

Both parties shall not be discharged from their responsibilities from any pending orders until such orders have been completed and paid for notwithstanding the termination of this Agreement.

19.	FORCE MAJEURE

19.1

Failure on the part of either party to perform any of its obligations set forth in this Agreement will not give either Party to this Agreement any claim against the other Party or be deemed to be a breach of the Agreement to the extent that such failure arises from Force Majeure. If through Force Majeure, the fulfillment of either Party of any obligation set forth in this Agreement will be delayed, the period of such delay will not be counted on in computing periods prescribed by this Agreement. Any Party failing to perform its obligations under this Agreement because of Force Majeure shall give notice in writing to the other Party of such force majeure as soon as possible after the occurrence.

19.2

Force majeure shall include any war, civil commotion, floods, earthquake, fire, strike, governmental action, lockout, accident, epidemic or any other event of any nature or kind whatsoever beyond the control of the Parties that directly or indirectly hinders or prevents the Parties from commencing or proceeding with consummation of the transactions contemplated hereby. Any Party hereto who fails because of force majeure to perform its obligations hereunder will upon the cessation of force majeure, take all reasonable steps within its power to resume with the least possible delay compliance with its obligations. If the conditions of force majeure shall continue for a period exceeding 6 months, then the Parties shall meet to decide upon the future performance of the Agreement.

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20.

NOTICES

20.1	Any notice given under this Agreement must be in writing and will be deemed duly given or made if given to a party personally or sent by registered post or facsimile to the address or facsimile number shown below.

ADAMIS Pharmaceuticals Corp,

Attn: CEO

2658 Del Mar Heights Road, Suite 555

Del Mar, California 92014, USA

Other Party:

BEXIMCO PHARMACEUTICALS LTD.

Attn: Managing Director

17 Dhanmandi R/A, Road No. 2

Dhaka 1205, Bangladesh

Phone: +880 2 8619 151 (5 lines)

Fax: +880 2 8613 888

20.2	Either party may change its address or facsimile number for the purpose of this Agreement by giving notice of the change to the other party.

20.3	A notice will be deemed to be received by a party in the following circumstances:

(a)

The elapse of 24 hours from the dispatch of the notice by facsimile transmission, where the transmission report confirms that the notice has been dispatched without a transmission error to the correct facsimile number;

(b)

The elapse of 3 business days from the dispatch of the notice by mail to a destination within the same jurisdiction; and

(c)

The elapse of 7 business days from the dispatch of the notice by mail to a destination outside the jurisdiction.

21.	ARBITRATION

21.1

All disputes arising out of the interpretation or the implementation of this Agreement shall be referred to a panel of arbitrators of London, UK. Each party shall appoint one arbitrator and the third arbitrator shall be appointed by the first two. The arbitration shall be conducted in accordance with the `Rules of Arbitration and Reconciliation’ of the International Chamber of Commerce.

22.

OTHERS

22.1	Any amendment to this Agreement shall not be valid unless duly executed by the authorized persons of both the parties.

22.2	This Agreement is subject to decisions of both parties’ policies, interest and the government regulations.

Page 13 of 23

22.3	All notices between the parties hereto shall be made in writing. The notice period shall be deemed to start from the date of receiving the same by the either of the parties concerned. The notices to the parties shall be sent to their registered official addresses.

22.4	This Agreement has been extended in two originals written in English, one of these has been retained by BEXIMCO and the other by ADAMIS.

In witness whereof the parties hereto have signed this Agreement on the day, month and year mentioned herein before.

Adamis Pharmaceuticals Corp.		Beximco Pharmaceuticals Ltd.

Signature :	/s/ Dennis Carlo	Signature :	/s/ Nazmul Hassan
Name:	Dennis J. Carlo, PhD	Name:	Nazmul Hassan, MD
Title:	CEO Adamis Pharmaceuticals Corp	Title:

In witness of:		In witness of:


1.		1.

Page 14 of 23

Annexure-I

Product List (Draft)

Sl. No.		Product Description	Strength	Pack Size	Operations to be completed by BEXIMCO
	1	Salbutamol Inhalation Aerosol with HFA propellant	100 mcg/ actuation	200 doses	Complete product under ADAMIS’s brand/generic name
	2	Beclometasone Nasal Spray with HFA propellant Aerosol with HFA propellant			Complete product under ADAMIS’s generic name
	3	Beclomethasone Inhalation Aerosol with HFA propellant	50 mcg/ actuation	200 doses	Complete product under ADAMIS’s generic name
	4	Beclomethasone Inhalation Aerosol with HFA propellant	100 mcg/ actuation	200 doses	Complete product under ADAMIS’s generic name

Page 15 of 23

Annexure 2

GMP AGREEMENT

SPECIFICATION OF GMP RESPONSIBILITES FOR PRODUCT SUPPLY TO USA

This agreement is valid for 60 months and will take effect as of1 st day of November in the year of 2010

It is the responsibility of both parties to review this agreement prior its expiry.

Signed on behalf of Manufacturer		Signed on behalf of Sponsor



Beximco Pharmaceuticals Ltd		Adamis Pharmaceuticals Corp.

Name: Nazmul Hassan		Name: Dennis Carlo

Position: Managing Director		Position: CEO

Date:		Date:

GMP AGREEMENT

1.	In order to comply with the current USFDA Code of GMP for medicines the following GMP agreement is entered into between.

1.1	Contract Giver: ADAMIS Pharmaceuticals Corp,2658 Del Mar Heights Road, Suite 555 Del Mar, California 92014, USA ,(hereunder called ADAMIS or “Sponsor”)

AND

1.2	Contract Acceptor: Beximco Pharmaceuticals Ltd with its registered office at: 17 Dhanmandi R/A, Road No. 2, Dhaka-1205, Bangladesh and pharmaceutical manufacturing facility located at: 126, Kathaldia, Auchpara, Tongi 1711, Gazipur, Bangladesh (hereunder called “Beximco”)

2.	Beximco Agrees to manufacture / package the products listed in the ‘Annexure 1’ as requested by the receipt of a purchase order following the signing & / or a current GMP agreement with Sponsor.

Page 16 of 23

GMP AGREEMENT

ASSIGNED RESPONSIBILITIES

	Activity	Responsibility
		Beximco	Sponsor (ADAMIS)
1	Sponsors / or appointed quality representative will be given access to Beximco premises for the purpose of GMP audits as agreed by	Ö
2	Starting Materials
2.1	Specified by	Ö	Ö
2.2	Supplied by (refer to quotation)	Ö
2.3	Approved by	Ö

3	Packaging Materials
3.1	Specified by	Ö	Ö
3.2	Supplied by	Ö
3.3	Approved by	Ö	Ö

4	Labels
4.1	Specified by	Ö	Ö
4.2	Supplied by	Ö
4.3	Approved by		Ö
4.4	Verified by	Ö

5	Printed Materials
5.1	Specified by	Ö	Ö
5.2	Supplied by	Ö
5.3	Approved by		Ö

6	Master / Listing Formula
6.1	Product registration with USFDA supplied by		Ö
6.2	Processing instructions supplied by	Ö	Ö
6.3	Product Specifications supplied by	Ö	Ö
6.4	Manufacturing process change – communication with USFDA		Ö

7	Master packaging B.O.M.
7.1	Supplied by	Ö
7.2	Processing instructions supplied by	Ö
7.3	Specifications	Ö	Ö

8	Beximco Master Document / Product Specifications
8.1	Prepared by	Ö
8.2	Approved by	Ö	Ö

9	Bulk Release	Ö

Page 17 of 23

10	Release for supply
10.1	Release to USA The person responsible for quality control and release for final packaging or supply of Products shall, to the extent determined by this agreement, be the Head of Quality or the person deputised to act on his/her behalf. The final release document to include a statement that the specific product is released as per USFDA GMP and product registration.	Ö

11	Expiry Date
	Responsibility of	Ö

12	Product Stability
	Responsibility of	Ö

13	Customer’s Complaints
13.1	Initial investigation including safety & efficacy	Ö	Ö
13.2	Follow up investigation relating to
	Manufacturing	Ö
	Packaging	Ö
	Control Testing	Ö

14	Responses to Complaint
14.1	Initial to contract giver	Ö
14.2	Final reply to customer		Ö

15	Retention Samples
15.1	Starting Materials	Ö
15.2	Finished Pack	Ö

16	Records
16.1	Batch documentations maintained by	Ö

17	Potential hazards to Premises, Plant / or Personnel
17.1	(specify if known)	Ö

18	Product Deviations Prepared	Ö
	Approved / Rejection		Ö

Page 18 of 23

Beximco and Sponsor agree that all information and documentation not in the public domain nor previously known to either party, passing between Beximco and Sponsor will be kept strictly confidential and is not to be divulged to any other party except to:

1. Beximco employees in order to carry out manufacturing & / or packaging processes & / or

2. government authorities for any mandatory requirements & / or

3. It should not pass to a third party any of the work entrusted to it by Sponsor without the latter having evaluated & consented to

Page 19 of 23

Annexure 3

REPORTING OF ADVERSE DRUG EVENTS FOR THE PRODUCT

1 . Adverse drug experience. Any adverse event associated with the use of a drug in humans, whether or not considered drug related, including the following: An adverse event occurring in the course of the use of a drug product in professional practice; an adverse event occurring from drug overdose whether accidental or intentional; an adverse event occurring from drug abuse; an adverse event occurring from drug withdrawal; and any failure of expected pharmacological action.

Disability: A substantial disruption of a person's ability to conduct normal life functions.

Life-threatening adverse drug experience: Any adverse drug experience that places the patient, in the view of the initial reporter, at immediate risk of death from the adverse drug experience as it occurred i.e. , it does not include an adverse drug experience that, had it occurred in a more severe form, might have caused death.

Serious adverse drug experience: Any adverse drug experience occurring at any dose that results in any of the following outcomes: Death, a life-threatening adverse drug experience, inpatient hospitalization or prolongation of existing hospitalization, a persistent or significant disability/incapacity, or a congenital anomaly/birth defect. Important medical events that may not result in death, be life-threatening, or require hospitalization may be considered a serious adverse drug experience when, based upon appropriate medical judgment, they may jeopardize the patient or subject and may require medical or surgical intervention to prevent one of the outcomes listed in this definition. Examples of such medical events include allergic bronchospasm requiring intensive treatment in an emergency room or at home, blood dyscrasias or convulsions that do not result in inpatient hospitalization, or the development of drug dependency or drug abuse.

Unexpected adverse drug experience: Any adverse drug experience that is not listed in the current labeling for the drug product. This includes events that may be symptomatically and path physiologically related to an event listed in the labeling, but differ from the event because of greater severity or specificity. For example, under this definition, hepatic necrosis would be unexpected (by virtue of greater severity) if the labeling only referred to elevated hepatic enzymes or hepatitis. Similarly, cerebral thromboembolism and cerebral vasculitis would be unexpected (by virtue of greater specificity) if the labeling only listed cerebral vascular accidents. "Unexpected," as used in this definition, refers to an adverse drug experience that has not been previously observed ( i.e. , included in the labeling) rather than from the perspective of such experience not being anticipated from the pharmacological properties of the pharmaceutical product.

(b) Review of adverse drug experiences. Each applicant having an approved application under 314.50 or, in the case of a 505(b)(2) application, an effective approved application, shall promptly review all adverse drug experience information obtained or otherwise received by the applicant from any source, foreign or domestic, including information derived from commercial marketing experience, post marketing clinical investigations, post marketing epidemiological/surveillance studies, reports in the scientific literature, and unpublished scientific papers. Applicants are not required to resubmit to FDA adverse drug experience reports forwarded to the applicant by FDA; however, applicants must submit all follow-up information on such reports to FDA. Any person subject to the reporting requirements under paragraph (c) of this section shall also develop written procedures for the surveillance, receipt, evaluation, and reporting of post marketing adverse drug experiences to FDA.

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(c) Reporting requirements. :The applicant shall report to FDA adverse drug experience information, as described in this section. The applicant shall submit two copies of each report described in this section to the Central Document Room, 5901-B Ammendale Rd., Beltsville, MD 20705-1266. FDA may waive the requirement for the second copy in appropriate instances.

(1)(i) Post marketing 15-day "Alert reports". The applicant shall report each adverse drug experience that is both serious and unexpected, whether foreign or domestic, as soon as possible but in no case later than 15 calendar days of initial receipt of the information by the applicant.

(ii) Post marketing 15-day "Alert reports"--follow-up. The applicant shall promptly investigate all adverse drug experiences that are the subject of these post marketing 15-day Alert reports and shall submit follow-up reports within 15 calendar days of receipt of new information or as requested by FDA. If additional information is not obtainable, records should be maintained of the unsuccessful steps taken to seek additional information. Post marketing 15-day Alert reports and follow-ups to them shall be submitted under separate cover.

(iii) Submission of reports: The requirements of paragraphs (c)(1)(i) and (c)(1)(ii) of this section, concerning the submission of post marketing 15-day Alert reports, shall also apply to any person other than the applicant (non-applicant) whose name appears on the label of an approved drug product as a manufacturer, packer, or distributor. To avoid unnecessary duplication in the submission to FDA of reports required by paragraphs (c)(1)(i) and (c)(1)(ii) of this section, obligations of a non-applicant may be met by submission of all reports of serious adverse drug experiences to the applicant. If a non-applicant elects to submit adverse drug experience reports to the applicant rather than to FDA, the non-applicant shall submit each report to the applicant within 5 calendar days of receipt of the report by the non-applicant, and the applicant shall then comply with the requirements of this section. Under this circumstance, the non-applicant shall maintain a record of this action which shall include:

(A) A copy of each adverse drug experience report;

(B) The date the report was received by the non-applicant;

(D) The name and address of the applicant.

(iv) Report identification:. Each report submitted under this paragraph shall bear prominent identification as to its contents i.e. , "15-day Alert report," or "15-day Alert report follow-up."

(2) Periodic adverse drug experience report: (i) The applicant shall report each adverse drug experience not reported under paragraph (c)(1)(i) of this section at quarterly intervals, for 3 years from the date of approval of the application, and then at annual intervals. The applicant shall submit each quarterly report within 30 days of the close of the quarter (the first quarter beginning on the date of approval of the application) and each annual report within 60 days of the anniversary date of approval of the application. Upon written notice, FDA may extend or reestablish the requirement that an applicant submit quarterly reports, or require that the applicant submit reports under this section at different times than those stated. For example, the agency may reestablish a quarterly reporting requirement following the approval of a major supplement. Follow-up information to adverse drug experiences submitted in a periodic report may be submitted in the next periodic report.

(ii) Each periodic report is required to contain: ( a ) a narrative summary and analysis of the information in the report and an analysis of the 15-day Alert reports submitted during the reporting interval (all 15-day Alert reports being appropriately referenced by the applicant's patient identification number, adverse reaction term(s), and date of submission to FDA); ( b ) a FDA Form 3500A (Adverse Reaction Report) for each adverse drug experience not reported under paragraph (c)(1)(i) of this section (with an index consisting of a line listing of the applicant's patient identification number and adverse reaction term(s)); and ( c ) a history of actions taken since the last report because of adverse drug experiences (for example, labeling changes or studies initiated).

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(iii) Periodic reporting, except for information regarding 15-day Alert reports, does not apply to adverse drug experience information obtained from post marketing studies (whether or not conducted under an investigational new drug application), from reports in the scientific literature, and from foreign marketing experience.

(d) Scientific literature: (1) A 15-day Alert report based on information from the scientific literature is required to be accompanied by a copy of the published article. The 15-day reporting requirements in paragraph (c)(1)(i) of this section ( i.e. , serious, unexpected adverse drug experiences) apply only to reports found in scientific and medical journals either as case reports or as the result of a formal clinical trial.

(2) As with all reports submitted under paragraph (c)(1)(i) of this section, reports based on the scientific literature shall be submitted on FDA Form 3500A or comparable format as prescribed by paragraph (f) of this section. In cases where the applicant believes that preparing the FDA Form 3500A constitutes an undue hardship, the applicant may arrange with the Office of Surveillance and Epidemiology for an acceptable alternative reporting format.

(e) Post marketing studies: (1) An applicant is not required to submit a 15-day Alert report under paragraph (c) of this section for an adverse drug experience obtained from a post marketing study (whether or not conducted under an investigational new drug application) unless the applicant concludes that there is a reasonable possibility that the drug caused the adverse experience.

(2) The applicant shall separate and clearly mark reports of adverse drug experiences that occur during a post marketing study as being distinct from those experiences that are being reported spontaneously to the applicant.

(f) Reporting FDA Form 3500A: (1) Except as provided in paragraph (f)(3) of this section, the applicant shall complete FDA Form 3500A for each report of an adverse drug experience (foreign events may be submitted either on an FDA Form 3500A or, if preferred, on a CIOMS I form).

(2) Each completed FDA Form 3500A should refer only to an individual patient or a single attached publication.

(3) Instead of using FDA Form 3500A, an applicant may use a computer-generated FDA Form 3500A or other alternative format (e.g., a computer-generated tape or tabular listing) provided that:

(i) The content of the alternative format is equivalent in all elements of information to those specified in FDA Form 3500A; and

(ii) The format is agreed to in advance by the Office of Surveillance and Epidemiology.

(4) FDA Form 3500A and instructions for completing the form are available on the Internet at http://www.fda.gov/medwatch/index.html .

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(g) Multiple report: An applicant should not include in reports under this section any adverse drug experiences that occurred in clinical trials if they were previously submitted as part of the approved application. If a report applies to a drug for which an applicant holds more than one approved application, the applicant should submit the report to the application that was first approved. If a report refers to more than one drug marketed by an applicant, the applicant should submit the report to the application for the drug listed first in the report.

(h) Patient privacy: An applicant should not include in reports under this section the names and addresses of individual patients; instead, the applicant should assign a unique code number to each report, preferably not more than eight characters in length. The applicant should include the name of the reporter from whom the information was received. Names of patients, health care professionals, hospitals, and geographical identifiers in adverse drug experience reports are not releasable to the public under FDA's public information regulations in part 20.

(i) Recordkeeping: The applicant shall maintain for a period of 10 years records of all adverse drug experiences known to the applicant, including raw data and any correspondence relating to adverse drug experiences.

(j) Withdrawal of approval. If an applicant fails to establish and maintain records and make reports required under this section, FDA may withdraw approval of the application and, thus, prohibit continued marketing of the drug product that is the subject of the application.

(k) Disclaimer: A report or information submitted by an applicant under this section (and any release by FDA of that report or information) does not necessarily reflect a conclusion by the applicant or FDA that the report or information constitutes an admission that the drug caused or contributed to an adverse effect. An applicant need not admit, and may deny, that the report or information submitted under this section constitutes an admission that the drug caused or contributed to an adverse effect. For purposes of this provision, the term "applicant" also includes any person reporting under paragraph (c)(1)(iii) of this section.

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I, Dennis J. Carlo, certify that:

1.	I have reviewed this quarterly report on Form 10- Q of Adamis Pharmaceuticals Corporation;

2.	Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

3.	Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and (15d-15(e)) and internal control over financial reporting (as defined in Exchange Acts Rules 13a-15(f) and 15(d-15(f)) for the registrant and we have:

	a)	designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared; and

	b)	designed such internal control over financial reporting, or caused such internal control over financial reporting disclosure to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; and

	c)	evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

	d)	disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.	The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

	a)	all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial data; and

	b)	any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


I, Robert O. Hopkins, certify that:

1.	I have reviewed this quarterly report on Form 10-Q of Adamis Pharmaceuticals Corporation;

2.	Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

3.	Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and (15d-15(e)) and internal control over financial reporting (as defined in Exchange Acts Rules 13a-15(f) and 15(d-15(f)) for the registrant and we have:

	a)	designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared; and

	b)	designed such internal control over financial reporting, or caused such internal control over financial reporting disclosure to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; and

	c)	evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

	d)	disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.	The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

	a)	all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial data; and

	b)	any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


	(1) the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2010 (the “Report”) fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934; and

	(2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

	/s/ Robert O. Hopkins
	Robert O. Hopkins
	Vice President and Chief Financial Officer