SOURCE: PharmStar Pharmaceuticals, Inc.

May 09, 2011 13:21 ET

PharmStar Pharmaceuticals Receives Updated Intellectual Property Appraisal Valued at $32 Million

ROCKY MOUNT, NC--(Marketwire - May 9, 2011) - PharmStar Pharmaceuticals, Inc., (PINKSHEETS: PHAR) (the "Company"), a U.S. drug developer, manufacturer and marketer of the FDA-approved, Over-the-Counter (OTC) liquid pain reliever Aquaprin™, today announced that it has received an updated appraisal for the Company's intellectual property. The new report states that the intellectual property associated with the patent, know-how and trademark positions of PharmStar Pharmaceuticals is valued at $32 million. The report was filed as a supplemental information disclosure with the OTC Markets on May 6, 2011 and may be found at http://www.otcmarkets.com/stock/PHAR/financials, under the "Supplemental Information -- PharmStar IP Valuation."

The appraisal report was provided by Hultquist IP, a firm that represents clients in intellectual property matters in a wide variety of technologies, including: chemical, biological, electronic, solid-state, mechanical, and information technologies. According to the Hultquist report, "This total present value of $32 million is determined to be the value of the intellectual property rights associated with the Aquaprin™ product and the Insta-prin™ applicator product, since in the absence of the intellectual property applicable to these products, commercialization would not be viable, and there would be no barrier to entry to far larger competitors with correspondingly larger resources. The exclusionary rights associated with the proprietary patent position of PSP, together with the branding trademarks, and substantial know-how of Howard Phykitt, warrant such valuation. We therefore conclude that the intellectual property rights relating to the Aquaprin™ product and the Insta-prin™ applicator product are fairly valued at $32 million."

On April 28, 2011, the Company filed its Quarterly Report for the first quarter of 2011. In the report, the Company recognized the value of its Intellectual Property and Patents, Research and Development of Patents at a total of $13,104,549. The Company will continue to list these assets at their imputed book value, rather than the determined market value pursuant to the report.

"Though we are pleased with the valuation ascribed to the Aquaprin™ product line by Hultquist IP, we believe that the prudent course of action at this time is to continue to show the value of our core assets at book value. We will do so until such a time as the Company is in full production, or has a clear and substantial reason to modify the said valuation," stated Howard Phykitt, Chairman and CEO of PharmStar.

About PharmStar Pharmaceuticals
PharmStar Pharmaceuticals, Inc. is a U.S.-based drug development, manufacturing and marketing company and the innovator of Aquaprin™, an FDA-approved Over-the-Counter (OTC) liquid pain reliever. In development since 1993 with over $3 million invested to-date, Aquaprin™ is a liquid derivative of aspirin based on a patent-pending formula. The product is designed to dissolve nearly instantly in just 1.5 ounces of water, which can be absorbed into the bloodstream up to 10 times faster than traditional OTC pain relievers, and with little to no stomach upset. PharmStar's headquarters are located in Rocky Mount, NC. For more information, visit www.pharmstarinc.com.

Forward-Looking Statements Disclosure
This press release includes "forward-looking statements" within the meaning of the federal securities laws, commonly identified by such terms as "believes," "will," "looking ahead," "anticipates," "estimates" and other terms with similar meaning. Although the Company believes that the assumptions upon which its forward-looking statements are based are reasonable, it can give no assurance that these assumptions will prove to be correct. Important factors that could cause actual results to differ materially from the Company's projections and expectations are disclosed in the Company's filings with the Securities and Exchange Commission. All forward-looking statements in this press release are expressly qualified by such cautionary statements and by reference to the underlying assumptions.

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