EMPLOYMENT AGREEMENT

                              --------------------





         This EMPLOYMENT AGREEMENT (this "Agreement"), dated as of July 23,

2003, by and between Elite Pharmaceuticals, Inc., a Delaware corporation (the

"Company"), and Bernard Berk (the "Executive"), residing at

___________________________.



                              W I T N E S S E T H:

                              - - - - - - - - - -



         WHEREAS, on June 3, 2003 (the "Effective Date"), the Company retained

the Executive as its Chief Executive Officer; and



         WHEREAS, the Company and the Executive desire to memorialize the terms

and conditions under which the Executive is currently serving, and will continue

to serve, as the Company's Chief Executive Officer;



         NOW, THEREFORE, in consideration of the mutual covenants contained

herein, the parties hereto agree as follows:



         Section 1. Term of Employment; Representations and Warranties of the

Executive. This Agreement shall be effective as of the Effective Date and,

subject to earlier termination as specified herein, shall continue until the

third anniversary of the Effective Date (the "Term"), provided, however, that

unless the Company or the Executive gives written notice to the other party at

least sixty (60) days prior to the expiration of the then-current Term that the

Company or the Executive, as the case may be, elects not to renew this

Agreement, the then-current Term shall be automatically extended for additional

one-year periods. The Executive hereby represents and warrants that (i) he has

the legal capacity to execute and perform this Agreement, (ii) this Agreement is

a valid and binding obligation of the Executive enforceable against him in

accordance with its terms, (iii) the Executive's service hereunder will not

conflict with, or result in a breach of, any agreement, understanding, order,

judgment or other obligation to which the Executive is presently a party or by

which he may be bound, and (iv) the Executive is not subject to, or bound by,

any covenant against competition, confidentiality obligation or any other

agreement, order, or judgment which would conflict with, restrict or limit the

performance of the services to be provided by him hereunder.



         Section 2. Position and Duties. (a) During the Term, the Executive

shall serve as the Chief Executive Officer of the Company. The Executive shall

have such powers and duties as are commensurate with such position and as may be

conferred upon him by the Board of Directors of the Company (the "Board").

During the Term, the Executive shall devote all of his business time, attention,

skill and efforts exclusively to the business and affairs of the Company.



         (b)  Upon consummation of a Strategic Transaction (as defined below),

if the Executive is then serving as the Chief Executive Officer of the Company,

the size of the Board shall be increased by one (1) member and the Executive

shall be appointed as a director of the



{PAGE}



Company to fill such vacancy. For purposes of this Agreement, "Strategic

Transaction" means, in any one or series of related transactions, (i) the sale

of all or substantially all of the assets of the Company where the fair value of

the consideration received by the Company (after all related fees and expenses),

as determined in good faith by the Board, is at least Ten Million Dollars

($10,000,000), (ii) a merger or other business combination with, or into,

another entity, where the fair value of the consideration received by the

stockholders of the Company (after all related fees and expenses) in connection

with such merger or other business combination, as determined in good faith by

the Board, is at least Ten Million Dollars ($10,000,000) or (iii) any public or

private sale by the Company of its debt or equity securities or securities

convertible into or exchangeable for its debt or equity securities which results

in net proceeds to the Company (after all related fees and expenses) of at least

Ten Million Dollars ($10,000,000).



         Section 3. Compensation. For all services rendered by the Executive in

any capacity during the Term, including, without limitation, services as an

executive officer, director, or member of any committee of the Company or any of

its subsidiaries, affiliates or divisions thereof, the Executive shall be

compensated as follows:



         (a)  The Company shall pay the Executive a fixed salary at a rate per

annum equal to Two Hundred Thousand Dollars ($200,000) until such time as the

Company consummates a Strategic Transaction, at which time the fixed salary

payable to the Executive shall increase to Three Hundred Thirty Thousand One

Hundred Forty Dollars ($330,140) per annum (the "Base Salary"). The Base Salary

shall be subject to such periodic increases as the Board shall deem appropriate

in light of, among other factors, the then-existing financial condition of the

Company and the Executive's success in implementing the Company's business plan

and achieving its strategic objectives. The Base Salary shall be payable in

accordance with the customary payroll practices of the Company.



         (b)  The Executive shall be eligible to receive an annual bonus in an

amount to be determined by the Compensation Committee of the Board of Directors

in its sole and absolute discretion.



         (c)  The Executive shall be entitled to three (3) weeks of vacation in

each calendar year during the Term; provided, however, that the Executive shall

not be entitled to carryover vacation from one year to any other year or to any

payment in respect of any unused or accrued vacation.



         (d)  On the Effective Date, the Company granted the Executive options

("Initial Options") to purchase three hundred thousand (300,000) shares of the

Company's Common Stock, par value $.01 per share (the "Common Stock"), pursuant

to the Company's 1997 Employee Stock Option Plan (the "Plan"). The Initial

Options (i) are, to the maximum extent permitted under applicable law, intended

to qualify as "incentive stock options" within the meaning of Section 422 of the

Internal Revenue Code, (ii) shall be fully vested as of the Effective Date,

(iii) shall have a per share exercise price equal to $2.01, the closing price of

a share of Common Stock, as listed on the American Stock Exchange, on the

Effective Date, and (iv) are subject to the terms and conditions set forth in

the Plan and the stock option agreement being entered into by the Company and

the Executive simultaneously herewith.



                                      -2-

{PAGE}



         (e)  The Company hereby grants to the Executive options to purchase an

additional three hundred thousand (300,000) shares of Common Stock (the

"Additional Options"). The Additional Options (i) shall, to the maximum extent

permitted under applicable law, qualify as incentive stock options, (ii) shall

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