Angeli Kolhatkar - Senior Vice President, Burns McClellan Rich Pascoe - Chief Executive Officer Steve Martin - Chief Financial Officer

Scott Henry - ROTH Capital Keay Nakae - Ascendiant Capital

Greetings, and welcome to the Apricus Biosciences’ Year End 2013 Financial Results and Corporate Update Teleconference and Webcast. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. (Operator Instructions) As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Ms. Angeli Kolhatkar. Thank you. Ms. Kolhatkar, you may begin.

Thanks, Doug. Good afternoon and thank you for joining us today. I am Angeli Kolhatkar, Senior Vice President with Burns McClellan. Apricus has recently partnered with us and we look forward to managing the Investor Relations effort together. With me today from Apricus is Chief Executive Officer, Rich Pascoe and Chief Financial Officer, Steve Martin. During today’s call, Rich will review the company’s progress during 2013 and more recent corporate events as well as the company’s – as what the company expects to accomplish during the rest of 2014 and beyond. Then Steve will provide an overview of the financials and we will then open the call for questions. I would like to remind everyone that during today’s conference call, management will be making certain forward-looking statements regarding future events or future financial performance of the company, including statements relating to expectations around the timing for commercial launch of products, business development plans and objectives such as outlicensing and acquiring products and product candidates and the development of the company’s product pipeline with second generation products and other product candidates. Such statements are predictions based on current expectations and actual results could differ materially. Please refer to our most recent filings with the United States Securities and Exchange Commission for additional discussions regarding these and other risks that may affect our business. These documents can be found on the company website at www.apricusbio.com. Apricus’ earnings press release for the quarter and full year ended December 31, 2013 crossed the wire short time ago and is available on the company’s website. I will now turn the call over to Rich Pascoe. Rich?

Thank you, Angeli and good afternoon and thank you all for joining us on the call today. Throughout 2013, we have made significant strides towards focusing and strengthening the company in an effort to establish a solid foundation from which we intend to build meaningful long-term shareholder value. Importantly, the team has worked diligently to achieve the five strategic objectives that we laid out in early 2013. These are first, obtaining regulatory approval in key markets in Europe for Vitaros, our novel topical on-demand treatment for erectile dysfunction; second, establishing new or expanding existing commercialization partnerships for Vitaros in un-partnered territories in Europe and Africa; three, strengthening our balance sheet; four, obtaining regulatory guidance from the U.S. FDA for Femprox, our novel on-demand topical treatment for female sexual interest and arousal disorder, or FSIAD; and lastly, divesting our non-core assets. I am pleased to report that we have achieved all of these objectives through 2013. Starting with Vitaros, in June of last year, Vitaros was approved under the European Decentralized Procedure in 10 countries. Since then, Vitaros has received national phase approvals in 8 of these 10 countries. We continue to expect Vitaros approval in Spain and Luxemburg in the first half of this year. On the partnering front, I am happy to report that we have significantly expanded the number of territories in which we have partners. In November of last year, we signed a partnership agreement with Laboratoires Majorelle to commercialize Vitaros in France, Monaco and certain countries in Africa. In December, we expanded our exclusive license agreement with Sandoz, a division of Novartis to cover additional territories outside of the initial collaboration in Germany. The expanded agreement now includes Austria, Belgium, Denmark, Finland, Iceland, Luxemburg, the Netherlands, Norway, Sweden as well as Switzerland. And more recently in February, we signed an exclusive license agreement with Recordati, a leader in the European urology market to commercialize Vitaros in Spain, Russia, Turkey, Ireland and certain other European and African countries. In addition to Majorelle, Sandoz and Recordati, we have established Vitaros commercialization partners in a number of key markets, including with Abbott in Canada for Vitaros is approved for the entire *ED population with Takeda in United Kingdom and with Bracco in Italy. We are very pleased with the quality of our partners for Vitaros around the world. Combined our upfront in pre-commercialization payments that we are eligible to receive from these partners including Recordati totaled approximately $19 million. In total we have received in part or are eligible to receive approximately $210 million in cash payments if certain milestones are achieved. The royalties we will receive on end user sales are generally tiered and in the low to mid-teen double-digit range, which will generate revenues for us on Vitaros is on the market. I will discuss the anticipated launch of Vitaros in a few moments. As you all are well aware, the ED market is large, estimated at over 150 million men on a worldwide basis and is expected to double over the next 10 years. In 2012, the global sales of the PDE-5 inhibitors were close to $5 billion, of which about half was generated in the United States. However, we believe there are further growth opportunities as over 50% of men who were diagnosed with erectile dysfunction are either contraindicated to the PDE-5 inhibitors, because of other medications they are taking or related health issues do not adequately respond to the PDE-5 inhibitors or just stopped using the PDE-5 inhibitors after some time, primarily due to tolerability issues. This commercial opportunity for Vitaros is quite attractive and as such we are particularly interested in moving Vitaros forward in the U.S. Several years ago, the company sold the U.S. rights for Vitaros to Warner Chilcott, which has subsequently been acquired by Actavis late last year. We had indicated to Actavis that we would like to partner with them in some form in order to move Vitaros forward in the clinic in the U.S. This could include reacquiring the U.S. rights to Vitaros. We believe that Vitaros had blockbuster potential in the U.S. and we would like to see that come to fruition. While we cannot predict the outcome of this effort at this time, we hope to have additional clarity on this matter in the first half of this year. I would now like to discuss Vitaros launch activities. We continued to expect Vitaros launches will occur throughout 2014 in Europe and Canada. Product launch initiatives and marketing planning have been initiated by each of our commercialization partners in Europe according to the status of the national phase approvals in each country. We have received commercial product orders from certain partners and we have manufactured products for certain of our partners and have begun manufacturing activities for others. We expect the initial shipments of commercial products to our partners to begin in the second quarter and to continue throughout this year. In Canada, we continue to work closely with our partner Abbott as they made significant progress towards extending the Vitaros cold chain product shelf life in an effort to optimize its commercial potential. As we mentioned in our third quarter call, we have made commitment to bring on a second manufacturing site in Montreal, Canada for the cold chain Vitaros product and we expect it will be ready to manufacture Vitaros for our partners in the second half of this year. Also many of our partners plan to be launching across Europe this year and we will be collaborating with them to ensure that they launch Vitaros with a clear and consistent message to the market, especially to the medical community. We will work with our partners throughout the launch period and beyond to educate the medical community, in particular, urologists who were the primary target for this product as a prescriber. As part of our arousal launch for Vitaros, Apricus along with our partners in Europe are hosting a symposium at the European Association of Urology Meeting in Stockholm, Sweden on April 11. This joint symposium shared by Dr. John Mulhall entitles a new paradigm in the treatment of erectile dysfunction, a topical option is designed to set the stage for a successful Vitaros launch across Europe throughout 2014 by bringing over 300 of the leading urologists in Europe together to hear from a distinguished panel of experts on how Vitaros in best-served patients suffering from erectile dysfunction. We look forward to this event and we expect to be conducting similar events along with our partners throughout this year to support the successful launch of Vitaros. We also had additional launch specific activities planned throughout this year to improve providing marketing and clinical support for our partners’ sales training and launch meetings. Ultimately, it’s our partners’ responsibility to use their own resources to sell Vitaros and to set timelines for the launch of Vitaros in their respective territories. However, in this period of partnership, we will continue to play an active role beyond the scope of our contractual agreements to ensure that our most important asset, Vitaros, is successfully introduced into the market this year. Now, turning to Femprox, we believe that Femprox could be the first and best-in-class and the only on-demand treatment approved for sexual interest and arousal disorder. As with the erectile dysfunction market, the FSIAD market represents a large unmet need. About 53 million or approximately 44% of the U.S. female population over 18 have reported a problem of female sexual dysfunction. As a reminder thus far, we have completed 7 clinical studies with Femprox, including a 100-patient Phase 2 study and a 400-patient Phase 3 proof-of-concept study. This proof-of-concept study met both primary and secondary endpoints with statistical significance and was also safe and very well tolerated. As we discussed on our third quarter call, we met with the FDA in August of last year and most recently with the European authorities earlier this year. From these meetings, we note that there is a clinical development pathway for this product. First and importantly, we have identified female sexual interest and arousal disorder, or FSIAD as the indication in pre-menopausal women. Second, regarding clinical endpoints, both the FDA and European agencies agreed that the primary endpoints of the trial should be satisfying sexual events, or SSEs and the arousal domain of the female sexual function index, or FSFI are appropriate. Both agencies recommended two Phase 3 trials each six months in duration with two doses of 500 and 100 micrograms of alprostadil and also identified additional safety endpoints and PK parameters that need to be demonstrated. Very recently, we indicated or initiated a comprehensive licensing strategy to outlicense the development and commercialization rights for Femprox in Europe, while seeking to retain commercial rights in the U.S. to preserve long-term asset value. We are seeking a first strategy as we believe that potential European partners would be interested in Femprox as there maybe a quicker path to market in Europe. The European authorities did acknowledge that a single Phase 3 trial with the statistical hurdle of a significant P value could support a filing for approval. In addition, given that Vitaros has been reviewed and approved by the European authorities and Femprox has same active ingredient, alprostadil and the same permeation enhancer, our novel DDAIP, our partners maybe able to rely upon some of these safety data and move more quickly through the regulatory process. We are excited about the potential that Femprox holds, the potentially very large market addressing the substantial unmet need, the fact that currently there are no products approved for in this indication and we now see a clear regulatory path. We plan to move more aggressively and look forward to completing our partnering activities in Europe this year in an effort to bring this novel product to market in the shortest timeframe possible. Finally, as we have worked diligently to advance Vitaros and Femprox, we have also made significant progress towards strengthening the company, including divesting our non-core assets, improving our balance sheet and simplifying the business. Importantly, we have positioned the company for success beyond 2013 by establishing a solid foundation from which we intend to launch an aggressive growth strategy in an effort to build long-term shareholder value. This will be accomplished in part by executing on the following strategic objectives. First, supporting our existing partners in Europe and Canada as they launch Vitaros throughout 2014. Second, further advancement of our second generation Vitaros delivery device, which extend the shelf life for Vitaros for up to 36 months from the current shelf life of 18 months and will not require refrigeration. Importantly, our room temperature device product is expected to provide up to 11 years of additional IP protection into 2013 versus the current formulation. We expect to complete our final device development in mid ‘14, which will allow us to compile the required 12-month real-time stability data and as well as filed for approval in European in 2015. Once approved, we will work with our commercial partners in Europe to launch the second generation Vitaros in early 2016. Three, we intend to work with Actavis to advance the development of Vitaros in the U.S. to include potentially reacquiring the U.S. rights, so that Apricus shareholders might benefit from the significant commercial opportunity Vitaros holds in the United States. Fourth, we intend we will seek to outlicense Femprox in Europe in the first half of this year in an effort to accelerate this development while attaining U.S. rights which we could leverage following early success in Europe. Fifth, we intend to make definitive progress in building a robust pipeline of products in men’s and women’s health to improve the exploring opportunities to exploit our novel permeation enhancer, DDAIP. And finally, we will continue to invest in human capital as we seek to become a stronger and more dynamic company. I would like to highlight a few – an example of our commitment to this final objective. In December of last year Dr. Kleanthis Xanthopoulos was elected as Chairman of our Board. Kleanthis is a visionary and leader in the biotech and pharmaceutical arena. A week ago we announced that Dr. Wendell Wierenga is appointed to our Board of Directors. Wendell brings decades of experience heading research and development programs that led to the marketing approval of over 17 medicines and has participated in the filings of over 70 investigational new drug disclosures or INDs. Wendell’s addition to our Board will enhance our ability to execute on our strategy. I am looking forward we will continue to play a premium on attracting and retaining high impact individuals to the organization. With that I will turn the call over to Steve to discuss our fourth quarter and year end financials. Steve?

Thank you, Rich. We filed our annual report on Form 10-K with our year end 2013 financial results with the United States Securities and Exchange Commission earlier today. In addition, we provided convinced 2013 and 2012 financial tables in our press release that was issued this afternoon. I would like to provide a few highlights on our balance sheet and financial results through the end of 2013. Last year we raised a net of $16.6 million in cash from financing activities and we realized $8.1 million in cash from the sale of non-core assets. These actions allowed us to strengthen our balance sheet to $21.4 million as of December 31, 2013 as compared to $15.1 million as of December 31, 2012. In addition, in 2014 we have received an additional $4.5 million in upfront license fees related to the recent Vitaros European license agreement announced over the last few months. We believe we have an appropriate level of cash now to support our current operating plan into mid-2015. In 2014, we expect to generate cash from the potential out license of Femprox and late in 2014 we expect to begin to realize initial royalty revenues from partner sales of Vitaros. We expect that our expenses will be focused on the development of the room temperature formulation of Vitaros, additional costs associated with supporting commercialization and launches of Vitaros in Europe to potentially new clinical development programs. General and administrative expenses were $3.1 million for the three months ended December 31, 2013 as compared to $5.0 million for the three months period ended December 31, 2012. For the year ended December 31, 2013 these expenses were $13.6 million as compared to $15.3 million for the year ended December 31, 2012. The decreases for both periods as compared to the same periods in the prior year are primarily related to cash and non-cash compensation charges in 2012 related to the departure of our former CEO. Additionally expenses related to our former French subsidiary decreased as compared to the prior year following the deconsolidation of these entities in April of 2013. These decreases were partially offset by higher legal expenses related to the disposition of certain assets and businesses and certain litigation expenses. Research and development expenses were $1.3 million for the three months ended December 31, 2013 which were comparable to the $1.2 million of R&D expenses for the three months period ended December 31, 2012. For the year ended December 31, 2013, these expenses were $5.1 million as compared to $5.4 million for the year ended December 31, 2012. The decrease in 2013 primarily relates to a decrease in license fees related to the purchase of an oncology product license in 2012 offset by an increase in consulting services to support our regulatory filings for Vitaros. Our net loss for the year ended December 31, 2013 was $16.9 million compared to our net loss of $31.8 million for the year ended December 31, 2012. The lower net loss in 2013 relates to the absence in 2013 of the non-cash charge related to the former French subsidiaries and the 2012 losses from discontinued operations. We believe that we have made significant progress in 2013 streamlining our core business and strengthening the company’s financial position in support of our strategic plans. I will now turn the call back to Rich.

Thank you, Steve. With our accomplishments in 2013 of gaining Vitaros’ approval across Europe bringing on new Vitaros partners in Europe, solidifying our Femprox strategy and strengthening our balance sheet to include divesting our non-core assets, Apricus is well-positioned to achieve our vision to be a leader in the development and commercialization of novel therapeutics in the area of men’s and women’s health. We are off to a fast start this year as we have made significant progress towards bringing Vitaros to the market in 2014 through our partners. Our Femprox partnering efforts have been launched, we successfully divested the last limits of our commercial business and we are fully committed to building a robust pipeline of innovative products to treat unmet need in men’s and women’s health. With that, we will now open the call up to questions. Operator?

Thank you. (Operator Instructions) Our first question comes from the line of John Henry (sic) (Scott Henry) with ROTH Capital. Please proceed with your question. Scott Henry - ROTH Capital: Thank you. It’s Scott. Guys, just a couple of questions. First of all, it’s a great year last year, congratulations. Now, looking out this year, I haven’t went through the whole K yet, but is there any kind of directional guidance you can give us with regards to R&D and SG&A? I mean, should we expect 2014 to look similar to 2013 any clarity there would be great?

Sure, Scott. Good question. What we have indicated is that our 2013, let’s go to G&A first, as you get to G&A in 2013, the second half of the year could give you (perjugate) indication of our run rate, we had a former French business that was divested earlier in the year. We are pretty steady on our personnel count. Rich talked about a couple of strategic opportunities in the personnel area, but for the most part, the G&A will be relatively consistent with the second half other than inflation. And when it comes to R&D, we have been in the roughly 5 million per year neighborhood and that would cover things going forward like the room temperature development for Vitaros and some other related activities for that launch of Vitaros. So I think we are probably relatively similar in the same category of R&D as we were in 2013. Scott Henry - ROTH Capital: Okay. And I mean it’s a tough question, but do you have any thoughts on what we should think about from Vitaros revenues in 2014? First of all, it sounds like we should expect them in second quarter, but perhaps not in the first quarter or even if you ship in second quarter with the lag puts them in third quarter, just trying to get an idea of how to think about the model?

Sure. Thanks Scott. And as you know, we have indicated that launches are expected to occur throughout 2014. So we haven’t got specific by partner, by country, but what that really means is that over time we will see some that will sample, we will see some that will launch, we will see some that will have higher revenues to us. We have indicated that 2015 and ‘16 are really much more substantial royalty revenue opportunities for us. So to keep it pretty simple, we have said it’s really the latter part of 2014, maybe third, maybe fourth we are going to start to see measurable amounts of money, but again it’s not going to have a significant financial impact in ‘14 because of the lag of when they report a sale versus when they report to us and we were able to recognize revenue. Scott Henry - ROTH Capital: Okay, great. And then I guess the final question which is an important one when I look at the 2014 strategic goals, obviously there are some promising goals here, the one that jumps out of me is number three outlicensing Femprox in Europe? I think that will be significant for the stock if you were to do that on favorable terms, what is your confidence that you will claim a deal in Europe? How confident are you?

Yes, Scott, this is Rich. And first of all, thank you for your comments. It’s been a great year and we are very proud of our accomplishments. We think there is more to accomplish here and part of that is licensing Femprox specifically in Europe. As you – I think we shared at the conference last week we kicked off of formal process last week in Europe to do just that. There is a considerable amount of interest from parties in Europe that would look to take sizeable piece if not all of Europe. There is a starting point clearly having the regulatory guidance in hand and having that in writing has helped accelerate some large discussions. And as we said last week and I’ll reiterate to you today it’s the top priority of ours and we will look to move that process forward as quickly as possible. I’m not going to comment on specific timing other than to say that it’s a top priority. I’ll say that we’ll look to retain as much value as we can in this asset moving forward and we’d like to leverage what a partner in Europe could do in the clinic to our benefit. So from a risk-reward standpoint we feel that bringing Vitaros forward on a – an accelerated fashion if you will in Europe to a partner and then being able to use that data trial in the life to come back to the U.S. at the appropriate time is the right path to follow. And with the regulatory guidance the interest it’s been expressed already and the work that we’ve already put into making that happen I feel confident that we’ll be able to accomplish that goal this year. Scott Henry - ROTH Capital: Okay, great. I appreciate the color. And thank you both for taking the questions.

Thank you.

Our next question comes from the line of Irina Koffler from Cantor Fitzgerald. Please proceed with your question. Irina Koffler – Cantor Fitzgerald: Hi, thanks for taking the questions. You mentioned leveraging your topical technology towards new pipeline assets. Just wondering if you could maybe expand on that a little bit or you’re thinking about more like post menopausal hormonal product or what direction are you going with over there? And then the second question is I was wondering if you could provide an update as to Abbott’s launch activities in Canada? Thanks.

Sure. Thanks, Irina. This is s Rich. We’re actually thinking a bit more broadly on the pipeline opportunities and being able to leverage our permeation enhancer. DDAIP allows us to deliver drugs such as alprostadil in the case of Vitaros and Femprox for the treatment of ED and FSIAD, but because of the broad opportunity or the broad range of products that we compare up with DDAIP we’re looking beyond the *confines of sexual medicine to accomplish that. Having said that, we would like to ensure and certainly it’s a top priority, they are listed in that order purposely, see the appropriate amount of effort being placed on supporting our partners as they launch, ensuring that our room temperature device moves forward on the most aggressive timeline possible. And as we think about bringing other products forward, we want to do that in a very disciplined fashion. But I think dermal application of other compounds that could be used to treat either men’s or women’s health condition and as we make progress on that front we’ll be bringing more to the market in terms of update. On your second question regarding Abbott we continue to have a very close relationship with Abbott and supporting them in their efforts to move Vitaros forward in Canada. As we’ve expressed before Abbott has been working very diligently here over the past quarters to move the needle if you will on the shelf life parameters for the product and specifically to enhance or extend the shelf life for the product in an effort to make that product more commercially attractive. We will continue to support them at that effort. In fact I had a call with them just today just as an update and we’re pleased with the progress they’re making and anticipate that they will continue to do that here in the coming months. As we stated in our comments today we anticipate having Vitaros launched in Europe as well as in Canada this year and we look forward to supporting Abbott and their preparations along those lines. Irina Koffler – Cantor Fitzgerald: Thanks. I just have one follow-up if I may. So Vitaros partnering discussions with Actavis, last I remember you were supposed to provide an update in the first quarter and now we’re looking at the first half. So what is the source of the delay in the discussion? Thanks.

Well there is no delay in the discussion, those are taking place. The outcome in terms of having some clarity on this we expect to happen in the first half. So as you recall in January the Warner Chilcott acquisition had been – integration I should say had been completed by Actavis. Shortly thereafter we had some initial dialog with Actavis around the future of Vitaros as a pipeline opportunity in their possession. And from there we’ve evolved our conversations around how we can work together or move forward including up to us we’re applying the right. So that’s the current state of play and as we make continued progress on that front we’ll update the market, but I think we’re on a good track. Irina Koffler – Cantor Fitzgerald: Thank you.

Thank you.

(Operator Instructions) Our next question comes from the line of Keay Nakae from Ascendiant Capital. Please proceed with your question. Keay Nakae - Ascendiant Capital: Yes, thank you. The first question relates to the licensing amounts you recognized in Q1. Is your intention to recognize *the entire $4.5 million on the P&L *in Q1? Will that *show up as *other income?

Good question, Keay. So we had a deal – two deals in the fourth quarter and another deal in the first quarter. So the revenue recognition model is a little bit unique as you know given that we had some upfronts. We have a global settlement agreement that’s connected with one of our deals in France and we also have some other commitments that go with the *cash that we received along the way. So it’s premature to give the estimated first quarter and second quarter revenue from those in terms of money but I’ll go ahead and say that within a short amount of time the cash portion of the revenues will come to the P&L and there is also some additional elements related to our French transaction that also going to come to the P&L in the near term. Keay Nakae - Ascendiant Capital: Okay. Rich, just a couple of points of clarity, the first one is related to Femprox and the opportunity in Europe, you will not go forward with that on your own unless you have a licensing partner in place?

That’s correct. We do not intend to initiate a clinical development of this product in advance of bringing on a qualified partner in Europe. For the reasons that I outlined it’s critical that we follow the path that lead us to a commercialization opportunity for this product in the least amount of time with the lowest risk associated with that and we still believe that is a European path. And when we couple that fact with the interest that’s been garnered thus far we feel that, that is the most appropriate way to build value for our shareholders while limiting risk. And as I said before we will continue to hold on to substantial rights of the product including the U.S. rights going forward as a way of maintaining that strategic value and enhance that. Keay Nakae - Ascendiant Capital: Okay. And you talked about the upcoming symposium at the urology conference coming up in April. Is there anything else that you have visibility to specific that Takeda plans to do either at that conference on their own or and on the other way as they move forward towards the commercial launch in the UK?

Yes. That’s a great question. And I’ll just want to state at the moment we’re not in a position to comment specifically on launch plans for any particular partner. I’ll say that just this past week in Germany we had a joint meeting with all of our European partners that are positioned to launch the product this year. And there was quite a bit of excitement and buzz in that meeting, I’ll say unequivocally we are very pleased with the level of preparation, *the thoughtfulness that has gone into these various launches throughout Europe this year and the enthusiasm that’s shared by our partners around the opportunity. Not to mention, there was some healthy competition that we are able to instill under that meeting among our partners. So I’ll just let it go with we are very pleased with the level of rigor, it’s gone into the planning, obviously these are the types of things that you – we’d intend to make more comments around as they happen, but I think it’s fair to say that we have an outstanding group of partners here, all of them including Abbott in Canada we’re focused on bringing this product to market in the most successful way and we are very pleased with that and we are very proud to support their efforts going forward. Keay Nakae - Ascendiant Capital: Alright, thanks.

There are no further questions in the queue. I would like to hand the call back over to management for closing comments.

Thank you, Doug. So in closing I would like to say that while we have made great progress since I joined Apricus one year ago tomorrow, we firmly believe that our best days are ahead of us as we execute on the strategic plans we have put in place for 2014 and beyond. I am excited about the potential for value creation this year to include the launch of Vitaros in Europe as well as other territories and I look forward to seeing many of you in May at our Annual Meeting of stockholders. Thank you.

Ladies and gentlemen, this does conclude today’s teleconference. Thank you for your participation. You may disconnect your lines at this time and have a wonderful day.