RxElite Announces Acquisition Of Assets Of FineTech Laboratories

RxElite, Inc., a developer, manufacturer, and marketer of specialty generic prescription drug products, announced recently its acquisition of the business and assets of FineTech Laboratories Ltd. (FineTech), located in Haifa, Israel, for $6.2M in cash and 18,632,383 shares of RxElite common stock. Combining the ability to develop and manufacture complex active pharmaceutical ingredients with RxElite's robust generic manufacturing and distribution capability is a major step for RxElite.

Jonathan Houssian, CEO and founder of RxElite gave these key points of the acquisition:

• The acquisition is expected to be accretive to earnings this year. FineTech achieved revenues of approximately $6M in and 2007, with strong profitability,
• The combination of the two companies will significantly expand the new product pipeline of RxElite,
• There are immediate opportunities to grow RxElite and FineTech's business over the next 12 months by leveraging RxElite's relationships and FineTech's product development capabilities,
• RxElite believes that its acquisition of FineTech brings deep scientific capabilities to develop new complex generic drugs at a relatively low cost, and
• By taking this step towards vertical integration in the area of product development, RxElite can maintain the strong focus of its sales, marketing and distribution team on successful market penetration for Sevoflurane, Isoflurane, and the next anesthetic gas product that it expects to launch in 2009.

"There are tremendous synergies for both companies both short and long term," continued Mr. Houssian. "The acquisition immediately expands our domestic and worldwide opportunities to develop and profitably launch complex generic drugs. A key part of FineTech's business model has been to develop very difficult Active Pharmaceutical Ingredients (APIs), selling and licensing them to major U.S. generic companies. FineTech's business model has resulted in several successful generic drug launches and significant profits for FineTech's partners over the last five years. RxElite plans to vertically integrate FineTech's business in order to capitalize on these type of profitable opportunities from FineTech's 5 current products, as well as their 6 complex APIs under development."

RxElite has acquired the physical facilities, the intellectual property and patents of FineTech and has retained all FineTech employees. FineTech's team of 29, including 20 Ph.D. level scientists, conducts proprietary research and development and manufactures complex APIs at its state-of-the-art manufacturing facility in Israel. This facility operates in compliance with U.S. Food and Drug Administration's current good manufacturing practices (cGMP) standards. FineTech successfully passed its first FDA inspection in October 2004.

"My colleagues and I are very excited to join in the vision of RxElite and look forward to the opportunities and challenges that await us," said Dr. Arie L. Gutman, President and Founder of FineTech. "We expect that our demonstrated ability for the synthesis of complex APIs will make us a very productive and highly valued contributor to RxElite as a newly combined business."

FineTech will operate as a separate division, through a wholly owned subsidiary of RxElite, and will provide immediate chemical synthesis, API development capabilities, and strategic opportunities to RxElite. FineTech will continue to actively work with current outside customers and to pursue development of new customer relationships for their services.

RxElite used proceeds from its recent senior convertible debt financing to complete the acquisition.

About FineTech
FineTech was founded in 1990 by Dr. Arie Gutman. FineTech specializes in the production of high value, low volume APIs for the pharmaceutical industry and in collaborative R&D work and process development. The company possesses proprietary technology and confidential expertise in several important and unconventional areas of organic synthesis. FineTech operates in a 35,000 sq. feet, 6 building campus facility, equipped with state-of-the-art laboratory, production and quality control equipment.

About RxElite, Inc.
RxElite, Inc. develops, manufactures, and markets generic prescription drug products in specialty generic markets. These markets include products in the areas of anesthesia, sterile liquid dose drugs (including respiratory inhalation drugs, ophthalmics, and injectable drugs), and transdermal patch products.

SOURCE: RxElite, Inc.