ISTA Pharmaceuticals (ISTA)

Concentration of Credit Risk

Financial instruments that potentially subject the Company to a significant concentration of credit risk principally consist of cash and cash equivalents, short-term investments, restricted cash and trade receivables. Wholesale distributors account for a substantial portion of trade receivables. At December 31, 2008, annual net revenues from AmeriSource Bergen Corp., McKesson HBOC and Cardinal Health, Inc. accounted for 14%, 37% and 40%, respectively, of the Company’s net revenues. The Company maintains reserves for bad debt and such losses, in the aggregate, have not exceeded management’s estimates.

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Table of Contents

ISTA PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Concentration of Credit Risk

Financial instruments that potentially subject the Company to a significant concentration of credit risk principally consist of cash and cash equivalents, short-term investments, restricted cash and trade receivables. Wholesale distributors account for a substantial portion of trade receivables. At December 31, 2008, annual net revenues from AmeriSource Bergen Corp., McKesson HBOC and Cardinal Health, Inc. accounted for 14%, 37% and 40%, respectively, of the Company’s net revenues. The Company maintains reserves for bad debt and such losses, in the aggregate, have not exceeded management’s estimates.

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Table of Contents

ISTA PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Concentration of Credit Risk

Financial instruments that potentially subject the Company to a significant concentration of credit risk principally consist of cash and cash equivalents, short-term investments, restricted cash and trade receivables. Wholesale distributors account for a substantial portion of trade receivables. At December 31, 2008, annual net revenues from AmeriSource Bergen Corp., McKesson HBOC and Cardinal Health, Inc. accounted for 14%, 37% and 40%, respectively, of the Company’s net revenues. The Company maintains reserves for bad debt and such losses, in the aggregate, have not exceeded management’s estimates.

F-9

Table of Contents

ISTA PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Concentration of Credit Risk

FACE="Times New Roman" SIZE="2">Financial instruments that potentially subject the Company to a significant concentration of credit risk principally consist of cash and cash equivalents, short-term investments, restricted cash and trade receivables.
Wholesale distributors account for a substantial portion of trade receivables. At December 31, 2008, annual net revenues from AmeriSource Bergen Corp., McKesson HBOC and Cardinal Health, Inc. accounted for 14%, 37% and 40%, respectively, of the
Company’s net revenues. The Company maintains reserves for bad debt and such losses, in the aggregate, have not exceeded management’s estimates.

F-9

Table of Contents

ISTA PHARMACEUTICALS, INC.

ALIGN="center">NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Concentration of Credit Risk

FACE="Times New Roman" SIZE="2">Financial instruments that potentially subject the Company to a significant concentration of credit risk principally consist of cash and cash equivalents, short-term investments, restricted cash and trade receivables.
Wholesale distributors account for a substantial portion of trade receivables. At December 31, 2008, annual net revenues from AmeriSource Bergen Corp., McKesson HBOC and Cardinal Health, Inc. accounted for 14%, 37% and 40%, respectively, of the
Company’s net revenues. The Company maintains reserves for bad debt and such losses, in the aggregate, have not exceeded management’s estimates.

F-9

Table of Contents

ISTA PHARMACEUTICALS, INC.

ALIGN="center">NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Concentration of Credit Risk

FACE="Times New Roman" SIZE="2">Financial instruments that potentially subject the Company to a significant concentration of credit risk principally consist of cash and cash equivalents, short-term investments, restricted cash and trade receivables.
Wholesale distributors account for a substantial portion of trade receivables. At December 31, 2008, annual net revenues from AmeriSource Bergen Corp., McKesson HBOC and Cardinal Health, Inc. accounted for 14%, 37% and 40%, respectively, of the
Company’s net revenues. The Company maintains reserves for bad debt and such losses, in the aggregate, have not exceeded management’s estimates.

F-9

Table of Contents

ISTA PHARMACEUTICALS, INC.

ALIGN="center">NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Concentration of Credit Risk

Financial instruments that potentially subject the Company to a significant concentration of credit risk principally consist of cash and cash equivalents, short-term investments, restricted cash and trade receivables. Wholesale distributors account for a substantial portion of trade receivables. At December 31, 2007, annual net revenues from AmeriSource Bergen Corp., McKesson HBOC and Cardinal Health, Inc. accounted for 15%, 37% and 38%, respectively, of our net revenues. The Company maintains reserves for bad debt and such losses, in the aggregate, have not exceeded management’s estimates.

F-9

Table of Contents

ISTA PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Concentration of Credit Risk

Financial instruments that potentially subject the Company to a significant concentration of credit risk principally consist of cash and cash equivalents, short-term investments, restricted cash and trade receivables. Wholesale distributors account for a substantial portion of trade receivables. At December 31, 2006, annual net revenues from AmeriSource Bergen Corp, McKesson HBOC and Cardinal Health, Inc. accounted for 18%, 35% and 34%, respectively, of our total revenues. The Company maintains reserves for bad debt and such losses, in the aggregate, have not exceeded management’s estimates.

Concentration of Credit Risk

Financial instruments that potentially subject the Company to significant concentration of credit risk consist primarily of cash and cash equivalents and short-term investments.

Concentration of Credit Risk

Financial instruments that potentially subject the Company to significant concentration of credit risk consist primarily of cash and cash equivalents and short-term investments.