DepoMed (DEPO)

Interest Income and Expense

Interest and other income decrease during the three months March 31, 2009 as compared to the corresponding period in 2008 as a result of lower interest rates on our investments.

Interest expense relates to interest on the credit facility we entered into in June 2008 with General Electric Capital Corporation and Oxford Finance Corporation.

Interest Income and Expense

        Interest and other income slightly increased in 2008 from 2007 as a result of higher investment balances, which was partially offset by lower interest rates on our investments. Interest income increased in 2007 over 2006 due to higher investment balances in 2007.

        Interest expense in 2008 relates to interest on the credit facility we entered into in June 2008 with General Electric Capital Corporation and Oxford Finance Corporation.

Interest Income and Expense

        Interest and other income slightly increased in 2008 from 2007 as a result of higher investment balances, which was partially offset by lower interest rates on our investments. Interest income increased in 2007 over 2006 due to higher investment balances in 2007.

        Interest expense in 2008 relates to interest on the credit facility we entered into in June 2008 with General Electric Capital Corporation and Oxford Finance Corporation.

Interest Income and Expense

        Interest
and other income slightly increased in 2008 from 2007 as a result of higher investment balances, which was partially offset by lower interest rates on our investments. Interest
income increased in 2007 over 2006 due to higher investment balances in 2007.

        Interest
expense in 2008 relates to interest on the credit facility we entered into in June 2008 with General Electric Capital Corporation and Oxford Finance Corporation.

Interest Income and Expense

Interest and other income decreased during the three months ended September 30, 2008 as compared to the corresponding period in 2007 as a result of lower interest rates on our investments. Interest and other income increased during the nine months ended September 30, 2008 as compared to the corresponding period in 2007 as a result of higher investment balances.

Interest expense relates to interest on the credit facility we entered into in June 2008 with General Electric Capital Corporation and Oxford Finance Corporation.

Interest Income and Expense

Interest and other income increased during the three and six months ended June 30, 2008 as compared to the corresponding periods in 2007 due to higher investment balances in 2008 resulting from the receipt of $29.7 million in termination fees from King and $17.5 million in license and termination fees from Esprit in the second half of 2007. Interest expense relates to interest on the credit facility we entered into in June 2008. We expect interest expense to increase in subsequent quarters.

Interest Income and Expense

        Interest income increased in 2007 over 2006 due to higher investment balances in 2007 resulting from of our receipt of $29.7 million in termination fees from King and $17.5 million in license and termination fees from Esprit in the second half of 2007. Interest income increased in 2006 over 2005 due to higher investment balances in 2006 resulting from of our receipt of license fees from Esprit and Biovail in 2005 and also due to higher interest rates earned on our investment portfolio. Interest

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expense in 2005 was mainly due to interest on a promissory note, issued to Elan Corporation plc, or Elan. The note was fully repaid in June 2005.

Interest Income and Expense

        Interest
income increased in 2007 over 2006 due to higher investment balances in 2007 resulting from of our receipt of $29.7 million in termination fees from King and
$17.5 million in license and termination fees from Esprit in the second half of 2007. Interest income increased in 2006 over 2005 due to higher investment balances in 2006 resulting from of our
receipt of license fees from Esprit and Biovail in 2005 and also due to higher interest rates earned on our investment portfolio. Interest

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expense
in 2005 was mainly due to interest on a promissory note, issued to Elan Corporation plc, or Elan. The note was fully repaid in June 2005.

Interest Income and Expense

Interest income increased in 2006 over 2005 due to higher investment balances in 2006 resulting from of our receipt of license fees from Esprit and Biovail in 2005 and also due to higher interest rates earned on our investment portfolio.

Interest expense in 2005 and 2004 was mainly due to interest on a promissory note, issued to Elan Corporation plc, or Elan. The note was fully repaid in June 2005.

Interest Income and Expense

Interest expense was approximately $233,000 and $227,000 for the three months ended March 31, 2005 and 2004, respectively.  The net increase of approximately $6,000 in interest expense for the period was due to increased interest of approximately $17,000 accrued on the Elan convertible loan facility, which was partially offset by a decrease of approximately $10,000 in interest expense on our other loan and lease obligations as they neared the end of their terms.  Interest on the Elan loan facility increased due to compounding of interest on the loan balance.  Interest and other income was approximately $172,000 for the three months ended March 31, 2005 compared to $146,000 in the same period of 2004.  The increase, year over year, was due to higher investment balances in 2005 as a result of our public offering in the first quarter of 2005 and also due to higher interest rates earned on our investment portfolio.  Interest and other income also included immaterial gains and losses realized on some of our marketable securities.