June 9, 2009 (FinancialWire) — Elite Pharmaceuticals, Inc. (OTCBB: ELTP) conducted the initial closing under the strategic alliance agreement with Epic Pharma, LLC and Epic Investments, LLC.

The signing of the alliance agreement was announced by Elite on March 23, 2009. Under the terms of the alliance agreement, Elite will commence a strategic relationship with Epic, a pharmaceutical company synergistic to Elite in the research and development and manufacturing of oral immediate and control release drug products.

Effective as of the initial closing, Epic has commenced the development of eight of its generic drug products at Elite’s facility pursuant to the Alliance Agreement with the intent of filing abbreviated new drug applications for obtaining United States Food and Drug Administration approval of such generic drug products. In addition, Elite and Epic have begun to share with each other certain resources, technology and know-how in the development of drug products, which Elite believes will benefit the continued development of its pain products, ELI-154 and ELI-216.

At the Initial Closing, Elite issued and sold to the Purchaser 1,000 shares of its Series E convertible preferred stock, at a price of $1,000 per share, for an aggregate purchase price of $1,000,000. Each share of Series E convertible preferred stock is convertible, at $0.05 per share, into 20,000 shares of Elite’s common stock, subject to adjustment for certain events, including, without limitation, dividends, stock splits, combinations and the like. Epic also acquired a warrant to purchase 20,000,000 shares of common stock, exercisable on or prior to June 3, 2016, at a per share exercise price of $0.0625, subject to adjustments for certain events, including, but not limited to, dividends, stock splits, combinations and the like. Epic paid the aggregate purchase price of $1,000,000 for the shares of Series E convertible preferred stock and the warrant issued and sold by Elite to Epic at the Initial Closing, of which $250,000 was received by the company, in the form of a cash deposit, on April 30, 2009, pursuant an amendment to the Alliance Agreement, and the remaining $750,000 of the aggregate purchase price was paid to Elite by Epic at the Initial Closing.

Elite Pharmaceuticals, Inc. develops oral sustained and controlled release products.

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