APRICUS BIOSCIENCES, INC. (APRI) SPO

We estimate that the net proceeds to us from the sale of 4,938,272 units will 
be approximately $18,400,000, based upon the public offering price of $4.05 
per unit and after deducting the underwriting discounts and commissions and 
estimated offering expenses payable by us and excluding the proceeds, if any, 
from the exercise of the warrants issued pursuant to this offering. 

We expect the proceeds from this offering together with existing cash and cash
equivalents to be sufficient to support our operations for at least the next 
12 months. 

We intend to use the net proceeds of this offering for general corporate 
purposes, including working capital, capital expenditures, development 
expenditures including filing for market authorization for multiple drugs 
in multiple territories and potential new product and company acquisitions, 
product re-launches and overall expansion of the commercial operations of the 
Company. 

The foregoing represents our intentions based upon our present plans and 
business conditions. The occurrence of unforeseen events or changed business 
conditions, however, could result in the application of the proceeds of the 
offering in a manner other than as described in this prospectus supplement. 
As a result, our management will retain broad discretion in the allocation 
and use of the net proceeds of this offering, and investors will be relying
on the judgment of our management with regard to the use of these net 
proceeds. Pending the application of the net proceeds, we expect to invest 
such proceeds in short term, interest-bearing instruments.

We are engaged in a highly competitive industry. We and our licensees can 
expect competition from numerous companies, including large international 
enterprises, and others entering the market for products similar to ours. Most 
of these companies have greater research and development, manufacturing, 
patent, legal, marketing, financial, technological, personnel and managerial 
resources. Acquisitions of competing companies by large pharmaceutical or 
healthcare companies could further enhance such competitors’ financial, 
marketing and other resources. Competitors may complete clinical trials, obtain
regulatory approvals and commence commercial sales of their products before we 
could enjoy a significant competitive advantage. Products developed by our 
competitors may be more effective than our product candidates. 

The Bio-Quant CRO business primarily competes against in-house departments of 
pharmaceutical, biotechnology and medical device companies, academic 
institutions and other contract research organizations in the U.S. and abroad. 
Competitors in Bio-Quant’s industry range from small, limited-service providers
to full service, global contract research organizations. Many of Bio-Quant’s 
competitors have an established global presence. In addition, many of Bio-
Quant’s competitors have substantially greater financial and other resources 
than Bio-Quant does and offer a broader range of services in more geographical 
areas than Bio-Quant does. Significant factors, among others, in determining 
whether Bio-Quant will be able to compete successfully include: its 
consultative capabilities; its reputation for on-time quality performance; its 
expertise and experience in specific drug discovery, research and development 
areas; the scope of its service offerings; its strength in various geographic 
markets; the price of its services; and its size. 

If Bio-Quant’s services are not competitive-based on these or other factors and
Bio-Quant is unable to develop an adequate level of new business, its business,
backlog position, financial condition and results of operations will be 
materially and adversely affected. In addition, Bio-Quant may compete for 
fewer clients arising out of consolidation within the pharmaceutical industry 
and the growing tendency of drug companies to outsource to a smaller number of 
preferred contract research organizations that have far greater resources and 
capabilities or that have lower cost structures owing to more inexpensive labor
wages. 

Bio-Quant’s services may from time to time experience periods of increased 
price competition that could have a material adverse effect on its 
profitability and revenues. Additionally, the CRO industry is not highly 
capital-intensive, and the financial costs of entry into the industry are 
relatively low. Therefore, as a general matter, the industry has few barriers 
to entry. Newer, smaller entities with specialty focuses, such as those aligned
to a specific disease or therapeutic area, may compete aggressively against 
Bio-Quant for clients which may cause Bio-Quant to seek strategic alternatives 
with its competitors.