1047699--3/3/2006--KING_PHARMACEUTICALS

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If we cannot successfully enforce our rights under the patents relating to three of our largest products, Altace , Skelaxin and Sonata , and the patent relating to Adenoscan , or if we are unable to secure or enforce our rights under other patents, trademarks, trade secrets or other intellectual property, our results of operations could be materially adversely affected. We have entered into agreements with manufacturers and/or distributors of generic pharmaceutical products with whom we are presently engaged, or have been previously engaged in litigation, and these activities could subject us to claims that we have violated federal and/or state anti-trust laws. We cannot assure you that we will be able to comply with the terms and conditions of our corporate integrity agreement with the Office of Inspector General of the United States Department of Health and Human Services. We are subject to the risk of additional litigation and regulatory proceedings or actions in connection with the restatement of prior period financial statements. We cannot assure you that we will be able to maintain effective internal control over financial reporting. If sales of our major products or royalty payments to us decrease, our results of operations could be materially adversely affected. Although we have an obligation to indemnify our officers and directors, we may not have sufficient insurance coverage available for this purpose and may be forced to pay these indemnification costs directly. We may not be able to maintain existing levels of coverage, which could make it difficult to attract or retain qualified directors and officers. We are required annually, or on an interim basis as needed, to review the carrying value of our intangible assets and goodwill for impairment. If events such as generic competition or inability to manufacture or obtain sufficient supply of product occur that cause the sales of our products to decline, the intangible asset value of any declining product could become impaired. If we cannot implement our strategy to grow our business through increased sales, acquisitions, development and in-licensing, our business or competitive position in the pharmaceutical industry may suffer. If we cannot integrate the business of companies or products we acquire, or appropriately and successfully manage and coordinate third-party collaborative development activities, our business may suffer. We do not have proprietary protection for most of our branded pharmaceutical products, and our sales could suffer from competition by generic substitutes. If we cannot sell our products in amounts greater than our minimum purchase requirements under some of our supply agreements or sell our products in accordance with our forecasts, our results of operations and cash flows may be adversely affected. Any significant delays or difficulties in the manufacture of, or supply of materials for, our products may reduce our profit margins and revenues, limit the sales of our products, or harm our products reputations. If third-party developers of some of our new product candidates and reformulated products fail to devote sufficient time and resources to our concerns, or if their performance is substandard or otherwise fails to comply with the terms of their agreements with us, or if we mismanage the development process, the introduction of new or reformulated products may not be successful. We are near maximum capacity at our Middleton, Wisconsin facility, which limits our ability to increase production of Thrombin-JMI . Wholesaler and distributor buying patterns and other factors may cause our quarterly results to fluctuate, and these fluctuations may adversely affect our short-term profitability. The insolvency of any of our principal customers, who are wholesale pharmaceutical distributors, could have a material adverse effect on our business, financial condition, results of operations and cash flows. Our wholly owned subsidiary, King Research and Development, successor to Jones Pharma Incorporated, is a defendant in litigation which is currently being handled by its insurance carriers. Should this coverage be inadequate or subsequently denied or were we to lose some of these lawsuits, our results of operations could be adversely affected. may be affected by the perception of risks associated with some of the raw materials used in its manufacture; if we are unable to successfully develop purification procedures at our facilities that are in accordance with the FDA s expectations for biological products generally, the FDA could limit our ability to manufacture biological products at those facilities. On November 15, 2006, we may be required to repurchase our 2 3 / 4 % Convertible Debentures due November 15, 2021, or we may elect to repurchase them sooner. A failure by Dey, L.P. to successfully market the EpiPen auto-injector, or an increase in competition, could have a material adverse effect on our results of operations. Our relationships with the U.S. Department of Defense and other government entities are subject to risks associated with doing business with the government. If we fail to comply with our reporting and payment obligations under the Medicaid rebate program or other governmental pricing programs, we could be subject to additional reimbursements, penalties, sanctions and fines which could have a material adverse effect on our business. If our operations were disrupted by a natural disaster or other catastrophic event, our business could be harmed. If we are unable to obtain approval of new HFA propellants for Intal and Tilade , our sales of these products could be adversely affected. There are risks associated with either the continuation or termination of our agreement with Wyeth to co-promote Altace . The loss of our key personnel or an inability to attract new personnel could harm our business. Our shareholder rights plan, charter and bylaws discourage unsolicited takeover proposals and could prevent shareholders from realizing a premium on their common stock. Our stock price is volatile, which could result in substantial losses for our investors. Risks Related to Our Industry Failure to comply with laws and government regulations could adversely affect our ability to operate our business. An increase in product liability claims or product recalls could harm our business. Any reduction in reimbursement levels by managed care organizations or other third-party payors may have an adverse effect on our revenues. If we fail to comply with the safe harbors provided under various federal and state laws, our business could be adversely affected. In the future, the publication of negative results of studies or clinical trials may adversely impact our products. New legislation or regulatory proposals may adversely affect our revenues. The pharmaceutical industry is highly competitive, and other companies in our industry have much greater resources than we do. A WARNING ABOUT FORWARD-LOOKING STATEMENTS

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1047699--3/3/2006--KING_PHARMACEUTICALS_INC