SECURITIES PURCHASE AGREEMENT

          SECURITIES PURCHASE AGREEMENT (the Agreement), dated as of September 13, 2006, by and among Akorn, Inc., a Louisiana corporation with headquarters located at 2500 Millbrook Drive, Buffalo Grove, Illinois 60089 (the Company), and Serum Institute of India, a Company incorporated under the laws of India, having its principal place of business at S. No. 212/2, OffSoli Poonawalla Road, Hadapsar, Pune 411 028, Maharashtra, India (Investor).

WHEREAS:

          A. The Company and Investor are executing and delivering this Agreement in reliance upon the exemption from securities registration afforded by Section 4(2) of the Securities Act of 1933, as amended (the Securities Act), and Rule 506 of Regulation D (Regulation D) as promulgated by the United States Securities and Exchange Commission (the Commission) under the Securities Act.

          B. Investor wishes to purchase, and the Company wishes to sell, upon the terms and conditions stated in this Agreement, that number of shares of the Common Stock, no par value per share, of the Company (the Common Stock), set forth opposite Investors name in column two (2) of Exhibit A (the Common Shares).

          NOW, THEREFORE, IN CONSIDERATION of the mutual covenants contained in this Agreement, and for other good and valuable consideration the receipt and adequacy of which are hereby acknowledged, the Company and Investor agree as follows:

ARTICLE I
DEFINITIONS

     1.1 Definitions. In addition to the terms defined elsewhere in this Agreement, the following terms have the meanings indicated:

          Advice has the meaning set forth in Section 6.5.

          Affiliate means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with a Person, as such terms are used in and construed under Rule 144 under the Securities Act.

          AMEX means the American Stock Exchange.

          Business Day means any day other than Saturday, Sunday or other day on which commercial banks in the city of New York or Buffalo Grove, Illinois are authorized or required by law to remain closed.

          Closing means the closing of the purchase and sale of the Common Shares pursuant to Section 2.2.

          Closing Date means the date and time of the Closing and shall be 5:00 p.m., New York City Time, on such date as is mutually agreed to by the Company and Investor after satisfaction of the conditions to Closing set forth in Article V.

          Commission means the Securities and Exchange Commission.

          Common Shares means an aggregate of 1,000,000 shares of Common Stock, which are being issued and sold by the Company to Investor at the Closing.

          Common Stock means the common stock of the Company, no par value per share.

          Company Counsel means Luce, Forward, Hamilton & Scripps LLP, counsel to the Company.

          Convertible Securities means any stock or securities (other than Options) convertible into or exercisable or exchangeable for Common Stock.

          DWAC Fees means fees payable to the Transfer Agents Deposit Withdrawal Agent for the electronic transmission of shares of Common Stock by crediting the account of Investors broker with Depository Trust Company Fast Automated Securities Transfer through the Transfer Agents Deposit Withdrawal Agent Commission system.

          Effective Date means the date that the Registration Statement is first declared effective by the Commission.

          Effectiveness Period has the meaning set forth in Section 6.1(b).

          Eligible Market means any of the New York Stock Exchange, AMEX, the NASDAQ National Market or the NASDAQ Capital Market.

          Exchange Act means the Securities Exchange Act of 1934, as amended and the rules and regulations promulgated thereunder.

          Event has the meaning set forth in Section 6.1(d).

          Event Payments has the meaning set forth in Section 6.1(d).

          Excluded Events has the meaning set forth in Section 6.1(d).

          8-K Filing has the meaning set forth in Section 4.5.

          FDA means the United States Food and Drug Administration.

          Filing Date means the day 60 days after the Closing Date.

          Holders of Existing Rights shall mean The John N. Kapoor Trust dated 9/20/89, AEG Partners, LLC, current and former holders of the Series B Preferred Stock, former holders of the Series A Preferred Stock, current and former holders of warrants issued in

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connection with the Series B Preferred Stock, current and former holders of warrants issued in connection with the Series A Preferred Stock, and the investors in the Companys private offering pursuant to that certain Securities Purchase Agreement dated March 1, 2006.

          Indemnified Party has the meaning set forth in Section 6.4(c).

          Indemnifying Party has the meaning set forth in Section 6.4(c).

          Intellectual Property Rights has the meaning set forth in Section 3.1(r).

          Knowledge of the Company, to the knowledge of the Company, to the Companys knowledge or any phrase of similar import shall be deemed to mean only to the actual knowledge, without investigation or inquiry, of either of Arthur S. Przybyl, the Chief Executive Officer of the Company, or Jeffrey A. Whitnell, the Chief Financial Officer of the Company.

          LaSalle Bank means LaSalle Bank, National Association.

          Lien means any lien, charge, claim, security interest, encumbrance, right of first refusal or other restriction, except for any Permitted Liens.

          Losses means any and all losses, claims, damages, liabilities, settlement costs and expenses, including, without limitation, costs of preparation and reasonable attorneys fees.

          Material Adverse Effect has the meaning set forth in Section 3.1(b).

          Material Permits has the meaning set forth in Section 3.1(t).

          NASD has the meaning set forth in Section 3.2(k).

          Options means any rights, warrants or options to subscribe for or purchase Common Stock or Convertible Securities.

          Permitted Liens means any lien, charge, claim, security interest, encumbrance, right of first refusal or other restriction disclosed in or contemplated by the SEC Reports, and any purchase money security interests and any Liens (i) in favor of LaSalle Bank or incurred in connection with the Senior Credit Agreement or the transactions associated therewith, and (ii) in favor of Standard Mortgage Investors, LLC or incurred in connection with the Companys mortgage agreement with Standard Mortgage Investors, LLC.

          Person means any individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company, or joint stock company.

          Plan of Distribution shall mean the Plan of Distribution attached hereto as Exhibit C, which shall be contained in the Registration Statement.

          Proceeding means an action, claim, suit, investigation or proceeding (including, without limitation, an investigation or partial proceeding, such as a deposition).

          Prospectus means the prospectus included in the Registration Statement (including, without limitation, a prospectus that includes any information previously omitted from a prospectus filed as part of an effective registration statement in reliance upon Rule 430A promulgated under the Securities Act), as amended or supplemented by any prospectus supplement, with respect to the terms of the offering of any portion of the Registrable Securities covered by the Registration Statement, and all other amendments and supplements to the Prospectus including post effective amendments, and all material incorporated by reference or deemed to be incorporated by reference in such Prospectus.

          Registrable Securities means any Common Stock issued or issuable pursuant to the Transaction Documents, together with any securities issued or issuable upon any stock split, dividend or other distribution, recapitalization or similar event with respect to the foregoing; provided, however, that securities shall only be treated as Registrable Securities if and only for so long as they (A) have not been disposed of pursuant to a registration statement declared effective by the Commission, and (B) have not been sold in a transaction exempt from the registration and prospectus delivery requirements of the Securities Act so that all transfer restrictions and restrictive legends with respect thereto are removed upon the consummation of such sale.

          Registration Statement means each registration statement required to be filed under Article VI, including (in each case) the Prospectus, amendments and supplements to such registration statement or Prospectus, including pre- and post-effective amendments, all exhibits thereto, and all material incorporated by reference or deemed to be incorporated by reference in such registration statement.

          Required Effectiveness Date means the earlier of (1) the 120th calendar day following the Filing Date or (2) in the event the Company is notified by the Commission that the Registration Statement will not be reviewed or is no longer subject to further review and comments, the fifth (5th) Trading Day following the date on which the Company is so notified.

          Required Senior Lenders shall mean Required Lenders as such term is defined in the Senior Credit Agreement.

          Rule 144, Rule 415, and Rule 424 means Rule 144, Rule 415 and Rule 424, respectively, promulgated by the Commission pursuant to the Securities Act, as such Rules may be amended from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same effect as such Rule.

          SEC Reports has the meaning set forth in Section 3.1(f).

          Securities Act means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.

          "Securities Laws means the rules and regulations, existing on the date hereof, of the Securities Act and the Exchange Act, as amended.

          "Senior Credit Agreement shall mean that certain Credit Agreement dated as of October 7, 2003 by and among the Company, Akorn (New Jersey), Inc., the financial institutions

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from time to time party thereto, as lenders, and LaSalle Bank, as administrative agent, as such Credit Agreement may be amended, restated, supplemented or otherwise modified from time to time.

          Series A Preferred Stock means the Companys Series A 6% Participating Convertible Preferred Stock.

          Series B Preferred Stock means the Companys Series B 6% Participating Convertible Preferred Stock.

          Shares means shares of the Companys Common Stock.

          Subsidiary means any Person in which the Company, directly or indirectly, owns a majority of the capital stock or similar interest that would be disclosable pursuant to Regulation S-K, Item 601(b)(21).

          Trading Day means (a) any day on which the Common Stock is listed or quoted and traded on its primary Trading Market, (b) if the Common Stock is not then listed or quoted and traded on any Eligible Market, then a day on which trading occurs on the NASDAQ National Market (or any successor thereto), or (c) if trading ceases to occur on the NASDAQ National Market (or any successor thereto), any Business Day.

          Trading Market means AMEX or any other Eligible Market, or any national securities exchange, market or trading or quotation facility on which the Common Stock is then listed or quoted.

          Transaction Documents means this Agreement, the schedules and exhibits attached hereto and the Transfer Agent Instructions.

          Transfer Agent means Computershare Investor Services LLC, or any successor transfer agent for the Company.

          Transfer Agent Instructions means, with respect to the Company, the Irrevocable Transfer Agent Instructions, in the form of Exhibit D, executed by the Company and delivered to and acknowledged in writing by the Transfer Agent.

ARTICLE II
PURCHASE AND SALE

     2.1 Purchase Price. Investor hereby agrees to pay to the Company the purchase price for the Common Shares by delivery of cash in an amount equal to (i) the number of Common Shares multiplied by (ii) $3.56 (the Purchase Price), in United States dollars and in immediately available funds, by wire transfer to an account designated in writing to Investor by the Company for such purpose.

     2.2 Closing. Subject to the terms and conditions set forth in this Agreement, at the Closing the Company shall issue and sell to Investor, and Investor shall purchase from the Company, the Common Shares. The date and time of the Closing and shall be 5:00 p.m., New

York City Time, on the Closing Date. The Closing shall take place at the offices of Company Counsel or such other location as the parties shall mutually agree.

     2.3 Closing Deliveries.

          (a) At the Closing, the Company shall deliver or cause to be delivered to Investor the following:

               (i) one or more stock certificates (or facsimile copies thereof), free and clear of all restrictive and other legends (except as expressly provided in Section 4.1(b) hereof), evidencing such number of Company Shares equal to the number of Shares set forth opposite Investors name on Exhibit A hereto under the heading Common Shares, registered in the name of Investor; and

               (ii) duly executed Transfer Agent Instructions acknowledged by the Companys transfer agent.

     (b) At the Closing, Investor shall deliver or cause to be delivered to the Company the following:

               (i) the Purchase Price;

               (ii) a completed copy of Exhibit B-1, Stock Certificate Questionnaire;

               (iii) a completed copy of Exhibit B-2, Registration Statement Questionnaire; and

               (iv) a completed and executed copy of Exhibit B-3, Certificate for Corporate, Partnership, Trust, Foundation and Joint Investors.

ARTICLE III
REPRESENTATIONS AND WARRANTIES

     3.1 Representations and Warranties of the Company. The Company hereby represents and warrants to Investor as follows:

          (a) Subsidiaries. The Company has no direct or indirect Subsidiaries other than those listed in the SEC Reports. All of the capital stock or comparable equity interests of each Subsidiary owned directly or indirectly by the Company are free and clear of any Lien and all the issued and outstanding shares of capital stock or comparable equity interest of each Subsidiary are validly issued and are fully paid, non-assessable and free of preemptive and similar rights.

          (b) Organization and Qualification. Each of the Company and the Subsidiaries is an entity duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization (as applicable), with the requisite legal authority to own and use its properties and assets and to carry on its business as currently conducted. Neither the Company nor any Subsidiary is in violation of any of the provisions of

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its respective certificate or articles of incorporation, bylaws or other organizational or charter documents. Each of the Company and the Subsidiaries is duly qualified to do business and is in good standing as a foreign corporation or other entity in each jurisdiction in which the nature of the business conducted or property owned by it makes such qualification necessary, except where the failure to be so qualified or in good standing, as the case may be, could not, individually or in the aggregate, (i) materially and adversely affect the legality, validity or enforceability of any Transaction Document, (ii) have or result in a material adverse effect on the results of operations, assets, business or financial condition of the Company and the Subsidiaries, taken as a whole on a consolidated basis, or (iii) materially and adversely impair the Companys ability to perform fully on a timely basis its obligations under any of the Transaction Documents (any of (i), (ii) or (iii), a Material Adverse Effect).

          (c) Authorization; Enforcement. The Company has the requisite corporate authority to enter into and to consummate the transactions contemplated by each of the Transaction Documents to which it is a party and otherwise to carry out its obligations hereunder and thereunder. The execution and delivery of each of the Transaction Documents to which it is a party by the Company and the consummation by it of the transactions contemplated hereby and thereby have been (or upon delivery will be) duly authorized by all necessary action on the part of the Company and no further consent or action is, or will be, required by the Company, its Board of Directors or its stockholders. Each of the Transaction Documents to which it is a party has been (or upon delivery will be) duly executed by the Company and is, or when delivered in accordance with the terms hereof, will constitute, the valid and binding obligation of the Company enforceable against the Company in accordance with its terms, except as may be limited by (i) applicable bankruptcy, insolvency, reorganization or other laws of general application relating to or affecting the enforcement of creditors rights generally, and (ii) the effect of rules of law governing the availability of specific performance, injunctive relief and other equitable remedies.