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SUBSEQUENT EVENTS

9 Months Ended

Sep. 30, 2011

NOTE H – SUBSEQUENT EVENTS

Agreement and Plan of Merger with VitaMedMD, LLC

The Company entered into the Merger Agreement with VitaMed pursuant to which the Company would acquire 100% of VitaMed. Upon the closing of the Merger Agreement, the Merger became effective upon the filing of the Certificate of Merger with the Secretary of State of the State of Delaware on October 4, 2011 (the "Effective Time").

In preparation of and prior to the closing of the Merger Agreement, the Company completed the following required corporate actions with an effective date of October 3, 2011:

	·	a reverse split of its outstanding shares of Common Stock on a ratio of 1 for 100 (the "Reverse Split"),
	·	an increase of its authorized shares of Common Stock to 250,000,000,

a change in the name of the Company to TherapeuticsMD, Inc., and

an amendment to the Company's Long Term Incentive Compensation Plan ("LTIP") to increase the authorized shares for issuance thereunder to 25,000,000.

Exchange of Securities through the Merger Agreement

At the Effective Time, all outstanding membership units of VitaMed (the "Units") were exchanged for shares of the Company's Common Stock. In addition, all outstanding VitaMed options ("Options") and VitaMed warrants ("Warrants") were exchanged and converted into options and warrants for the purchase of the Company's Common Stock ("Company Options" and "Company Warrants"). All Units, Options and Warrants were exchanged on a pro-rata basis for shares or a right to acquire shares of the Company's Common Stock at a ratio of 1,227425 to 1 (the "Conversion Ratio"). Pursuant to the Conversion Ratio, the Company subsequently (i) issued 58,407,331 shares of the Company's Common Stock in exchange for the outstanding Units, (ii) issued Company Options under the LTIP for the purchase of an aggregate of 10,119,795 shares of the Company's Common Stock (of which a Company Option for the purchase of 3,069 shares was subsequently cancelled due to termination of employment), (iii) issued Company Warrants for the purchase of an aggregate of 859,203 shares of the Company's Common Stock, and (iv) reserved 613,710 shares of the Company's Common Stock in connection with the Company's assumption of VitaMed's obligation to issue future Warrants to affiliates in consideration for their guarantee of a bank loan for the benefit of VitaMed (the "Reserved Warrants"). The Reserved Warrants will be issued to certain officers and directors of the Company once they are earned.

Change in Officers and Directors Pursuant to Merger Agreement

In connection with the Merger, the sole director serving on the Company's Board of Directors immediately prior to the Merger resigned and the following individuals were elected as directors:

Robert G. Finizio, Chairman

John C.K. Milligan

Brian Bernick, M.D.

In addition, the sole officer of the Company immediately prior to the Merger resigned and the following individuals were named as officers:

	Robert G. Finizio	Chief Executive Officer
	John C.K. Milligan	President, Secretary
	Daniel A. Cartwright	Chief Financial Officer, Vice President Finance, Treasurer
	Mitchell Krassan	Executive Vice President, Chief Strategy Officer

The above officers hold the same positions in VitaMed. Officers serve at the pleasure of the Company's Board of Directors.

Change in Control Pursuant to Merger Agreement

As previously mentioned herein, pursuant to the Closing of the Merger, the Company issued 58,407,331 shares of its Common Stock to the members of VitaMed in exchange for 100% of their ownership thereof. Prior to the subject Merger, the members of VitaMed owned no shares of the Company. After giving effect to (i) the Reverse Split and (ii) the issuance of the Company's Common Stock in exchange for all of the outstanding units of VitaMed, there were 58,573,187 shares of the Company's Common Stock issued and outstanding after the Merger.

Securities Issued Pursuant to Stock Purchase Agreement with Pernix Therapeutics, LLC

On September 8, 2011, the Company entered into a Stock Purchase Agreement with Pernix Therapeutics, LLC, a Louisiana limited liability company ("Pernix"). Pursuant to the terms of the Stock Purchase Agreement, Pernix agreed to purchase 2,631,579 shares of the Company's Common Stock (the "Shares") at a purchase price of $0.38 per share for a total purchase price of $1,000,000 ("Purchase Price"). The closing of the Stock Purchase Agreement took place on October 5, 2011 wherein Pernix wired the Purchase Price for the benefit of the Company to VitaMed and the Company issued the Shares.

In connection with the Stock Purchase Agreement, the Company and Pernix entered into a Lock-Up Agreement of even date therewith, which, among other things, restricts the sale, assignment, transfer, encumbrance and other disposition of the Shares issued to Pernix. Pursuant to the terms of the Lock-Up Agreement, Pernix agreed that for a period of twelve (12) months from the date of the Lock-Up Agreement, it would not make or cause any sale of the Shares (the "Lock-Up Period"). After the completion of the Lock-Up Period, Pernix agreed not to sell or dispose of more than five percent (5%) of the Shares per quarter for the following twelve (12) month period.

The foregoing descriptions of the Stock Purchase Agreement and Lock-Up Agreement are qualified, in their entirety, by reference to each agreement, copies of which were attached as exhibits to the Current Report on Form 8-K filed with the Commission on September 14, 2011, which filing and exhibits are incorporated by reference.

Debt Conversion Agreements with Energy Capital, LLC and First Conquest Investment Group, LLC

As previously reported, during 2009, a non-affiliate business consultant ("Consultant") provided consulting services to the Company in the amount of $210,000 (the "Debt"). The Company issued the Consultant a demand promissory note for $210,000 dated November 9, 2010 (the "November 2010 Note") which was subsequently assigned to unaffiliated entities ("Noteholders"). On April 18, 2011, the Company and the Noteholders agreed that in exchange for the forbearance of the Noteholders not to make demand for repayment of the November 2010 Note for a minimum of sixty (60) days, the Company would (i) cancel the November 2010 Note and (ii) issue two convertible promissory notes to the Noteholders in the principal amount of $105,000 each bearing interest at the rate of six percent (6%) per annum (the "Convertible Notes"). The Convertible Notes were due on demand any time after sixty (60) days from the date of issuance (the "Maturity Date"). At the option of the Noteholders, the Convertible Notes could be converted into shares of the Company's Common Stock at any time after the Maturity Date at a fixed conversion price of $0.0105 per share. The Convertible Notes contained anti-dilution provisions.

On October 18, 2011, the Company and the Noteholders entered into Debt Exchange Agreements in which the principal amount of the Convertible Notes was converted. Pursuant to the terms thereof, an aggregate of 20,000,000 shares of the Company's Common Stock was issued to the Noteholders and their assigns. After the issuance, the Company had 81,204,766 shares of its Common Stock issued and outstanding.

The foregoing descriptions of the Convertible Notes and the Debt Conversion Agreements are qualified, in entirety, by reference to the each agreement, copies of which were attached as exhibits to the Company's Current Report on Form 8-K filed with the Commission on October 24, 2011, which filing and exhibits are incorporated herein by reference.

Consulting Agreement with Lang Naturals, Inc.

On October 21, 2011, the Company and VitaMed entered into a Consulting Agreement (the "Lang Agreement") with Lang Naturals, Inc., the primary product manufacturer of VitaMed ("Lang"). Under the two-year Lang Agreement, a Lang representative will help evaluate improvements to existing products and new products as well as services including, but not limited to research, design, compliance, scientific and regulatory affairs and commercialization of products. Compensation to Lang included the issuance of a ten-year Warrant for 800,000 underlying shares which vested immediately upon issuance. In conjunction with the Warrant, Lang executed a Lock-Up Agreement under which Lang agreed that for a period of eighteen (18) months thereafter, Lang would not make or cause any sale of the Company's securities. The Lang Agreement, Warrant and Lock-Up Agreement were attached as exhibits to the Company's Current Report on Form 8-K filed with the Commission on October 24, 2011, which filing and exhibits are incorporated herein by reference.

Issuance of Options

On October 21, 2011, the Company issued Options pursuant to the LTIP to employees for the purchase of an aggregate of 385,000 shares of the Company's Common Stock with a fair value of $68,145. One ten-year Option for the purchase of 50,000 shares of the Company's Common Stock vests at the rate of 2,083.33 shares per month over a 24-month period and has an exercise price of $0.38 per share. The remaining ten-year Options vest annually over a 48-month period and have an exercise price of $0.38 per share, including an Option for the purchase of 300,000 shares of the Company's Common Stock granted to the Company's Chief Financial Officer, Daniel A. Cartwright. The valuation methodology used to determine the fair value of the Options was the Black-Scholes-Merton option-pricing model ("Black-Scholes Model"), an acceptable model in accordance with ASC 718-10. The Black-Scholes Model requires the use of a number of assumptions including volatility of the stock price, the weighted average risk-free interest rate, and the weighted average term of the Options. The Options were valued on the date of the grant using a term of three (3) years; volatility of 71.12%; risk free rate of 0.46%; and a dividend yield of 0%.

Issuance of Warrants

On October 21, 2011, the Company issued Common Stock Purchase Warrants ("Warrants") for the purchase of an aggregate of 1,584,211 shares of the Company's Common Stock with an exercise price of $0.38 per share as listed below. The valuation methodology used to determine the fair value of the Warrants was the Black-Scholes Model as defined above.

(a)

The Company's Chief Financial Officer, Daniel A. Cartwright, received a ten-year Warrant for the purchase of 600,000 shares of the Company's Common Stock which vests monthly over a 44-month period with a fair value of $172,200. The Warrant was valued on the date of the grant using a term of ten (10) years; volatility of 68.99%; risk free rate of 2.23%; and a dividend yield of 0%.

(b)

As previously mentioned, Lang received a ten-year Warrant for the purchase of 800,000 shares of the Company's Common Stock which vested immediately upon issuance with a fair value of $229,600. The Warrant was issued as compensation relating to a two-year Consulting Agreement with the Company. In conjunction with the issuance of the Warrant, Lang executed a Lock-Up Agreement. The Warrant was valued on the date of the grant using a term of ten (10) years; volatility of 68.99%; risk free rate of 2.23%; and a dividend yield of 0%.

(c)

A non-affiliate received a five-year Warrant for the purchase of 184,211 shares of the Company's Common Stock which vested immediately upon issuance with a fair value of $42,921. The Warrant was issued as commission for introduction of a funding source. The Warrant was valued on the date of the grant using a term of five (5) years; volatility of 75.72%; risk free rate of 1.08%; and a dividend yield of 0%.

Software Licensing Agreement with Pernix

On November 3, 2011, the Company and VitaMed entered into a Software License Agreement ("License Agreement") with Pernix relative to VitaMed's patent pending OPERA™ system (Ongoing Physician, Payor and Patient Evaluation Reporting and Analysis). Under the terms of the License Agreement, Pernix will have the exclusive use for a period of five years of the OPERA™ system software in the field of pediatric medicine for a monthly fee of $21,700.

Unaudited Condensed Consolidated Proforma Financial Statements

PRO-FORMA UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

The following unaudited pro-forma consolidated financial statements give effect to the reverse acquisition of VitaMed by the Company and are based on estimates and assumptions set forth herein and in the notes to such pro-forma statements.

The Company entered into a Merger Agreement by and among VitaMed and VitaMed Acquisition, LLC, ("Merger Sub"), pursuant to which the Company would acquire 100% of VitaMed. The acquisition was accomplished by the merger of Merger Sub with and into VitaMed with VitaMed being the surviving limited liability company (the "Merger") in accordance with the Limited Liability Company Act of the State of Delaware. The Merger became effective upon the filing of the Certificate of Merger with the Secretary of State of the State of Delaware on October 4, 2011 (the "Effective Time").

Prior to the closing of this transaction, the Company effected a reverse stock split of its issued and outstanding shares of common stock on a ratio of 1 for 100 (the "Reverse Split"),

This Merger is being accounted for as a reverse acquisition and a recapitalization. VitaMed is the acquirer for accounting purposes.

The following unaudited pro-forma consolidated statement of operations for the nine months ended September 30, 2011 and the year ended December 31, 2010 gives effect to the above as if the Merger and related transactions had occurred at the beginning of the period. The unaudited pro-forma consolidated balance sheet of September 30, 2011 gives effect to the above as if the Merger and related transactions had occurred on September 30, 2011.

THERAPEUTICSMD, INC. AND SUBSIDIARIES

f/k/a AMHN, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2011

UNAUDITED PROFORMA CONSOLIDATED BALANCE SHEET

SEPTEMBER 30, 2011

	Historical
	TherapeuticsMD			VitaMed			Adjustments				Consolidated
ASSETS
Current Assets
Cash	$	4,238		$	153,944		$	1,000,000		E	$	1,158,182
Accounts receivable		2,100			32,304			(2,100	)	D		32,304
Inventory		-0-			824,461			-0-				824,461
Prepaid expense		999			8,165			-0-				9,164
Total current assets		7,337			1,018,874			997,900				2,024,111
Fixed Assets, net of accumulated
depreciation of $51,651		-0-			103,471			-0-				103,471

Other Assets
Deposits		-0-			31,949			-0-				31,949
Intangible assets		-0-			10,000			-0-				10,000
Total other assets		-0-			41,949			-0-				41,949
TOTAL ASSETS	$	7,337		$	1,164,294		$	997,900			$	2,169,531

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities
Accounts payable	$	15,182		$	532,548			-0-			$	547,730
Note, credit lines and loans payable,
net of debt discount of $95,576		210,000			1,797,470			(210,000	)	F		1,797,470
Note and loans payable related parties,
net of debt discount of $67,199		155,000			185,468			(155,000	)	C		185,468
Dividends payable		41,359			-0-			-0-				41,359
Other accrued expenses		15,505			-0-			(9,809	)	C		-0-
								(5,696	)	F
TOTAL LIABILITIES		437,046			2,515,486			(380,505	)			2,572,027

Stockholders’ Equity
Common stock		16,575			-0-			(16,409	)	A		81,205
								58,407		B
								2,632		E
								20,000		F
Members contributions		-0-			5,489,950			(5,489,950	)	G		-0-
Additional paid in capital		1,661,321			1,169,903			16,409		A		7,529,444
								(58,407	)	B
								164,809		C
								997,368		E
								195,696		F
								3,382,345		G
Accumulated deficit		(2,107,605	)		(8,011,045	)		(2,100	)	D		(8,013,145	)
								2,107,605		G
TOTAL STOCKHOLDERS’ DEFICIT		(429,709	)		(1,351,192	)		1,378,405				(402,496	)

TOTAL LIABILITIES AND STOCK-
HOLDERS’ EQUITY	$	7,337		$	1,164,294		$	997,900			$	2,169,531

A	To reflect the reverse stock split of the Company’s shares of common stock issued and outstanding on a one hundred for one (100:1) basis dated October 4, 2011.
B	To record the issuance of 58,407,331 (post reverse split shares as of October 4, 2011 to the shareholders of VitaMed.
C	To record the forgiveness of debt.
D	The proforma adjustments represent the estimated proforma impact on the Company. These items were not incurred on a historical basis and the Company did not receive any historical benefits for these items in the historical period presented herein.
E	To record common stock issued pursuant to a stock purchase agreement dated October 5, 2011 with Pernix Therapeutics, LLC.
F	To record common stock issued pursuant to a debt conversion agreement dated October 18, 2011 with Energy Capital, LLC and First Conquest Investment Group, LLC.
G	Purchase accounting adjustment. Accumulated Deficit recorded against Additional Paid in Capital.

UNAUDITED PROFORMA CONSOLIDATED STATEMENT OF OPERATIONS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2011

	Historical
	TherapeuticsMD			VitaMed			Adjustments				Consolidated

Sales	$	2,100		$	1,533,806		$	(2,100	)	B	$	1,533,806
Cost of sales		-0-			685,450			-0-				685,450
Gross profit		2,100			848,356			(2,100	)			848,356

Expenses:
Sales, general and administration		164,933			4,274,098			(164,933	)	B		4,274,098
Research and development		-0-			80,541			-0-				80,541
Depreciation expense		-0-			24,996			-0-				24,996
Total operating expenses		164,933			4,379,635			(164,933	)			4,379,635
Operating loss		(162,833	)		(3,531,279	)		162,833				(3,531,279	)

Other income (expense):
Other income		5,000			-0-			(5,000	)	B		-0-
Interest expense		(19,097	)		(123,666	)		3,592		A		(123,666	)
								15,505		B
Total other income (expense)		(14,097	)		(123,666	)		14,097				(123,666	)
Loss from continuing operations
before taxes		(176,930	)		(3,654,945	)		176,930				(3,654,945	)
Provision for income taxes		4,304			-0-			(4,304	)			-0-
Loss from continuing operations		(181,234	)		(3,654.945	)		181,234				(3,654,945	)

Discontinued operations:
Gain on disposal of
discontinued operations		705,668			-0-			(705,668	)	B		-0-
Loss from discontinued
operations		(46,591	)		-0-			46,591		B		-0-
Net loss from discontinued
operations		659,077			(3,654,945	)		(659,077	)			-0-
Net income (loss)	$	477,843		$	(3,654,945	)	$	(477,843	)		$	(3,654,945	)

Basic and diluted loss per common share											$	(0.05	)
Weighted average common shares outstanding, basic and diluted												81,204,766


	(A)	The proforma adjustment to interest expense reflects accrued expense associated with forgiveness of debt.

(B)

The proforma adjustments represent the estimated proforma impact on the Company. These items were not incurred on a historical basis and we did not receive any historical benefits for these items in the historical period presented herein.

THERAPEUTICSMD, INC. AND SUBSIDIARIES

f/k/a AMHN, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2011

UNAUDITED PROFORMA CONSOLIDATED STATEMENT OF OPERATIONS

FOR THE YEAR ENDED DECEMBER 30, 2010

	Historical
	TherapeuticsMD			VitaMed			Adjustments					Consolidated

Sales	$	48,217		$	1,241,921		$	(48,217	)	A		$	1,241,921
Cost of sales		-0-			556,390			-0-					556,390
Gross profit		48,217			685,531			(48,217	)				685,531

Expenses:
Operating		71,932			-0-			(71,932	)		A		-0-
Sales, general and administration		382,860			3,650,959			(382,860	)		A		3,650,959
Research and development		-0-			65,402			-0-					65,402
Depreciation expense		61,383			22,783			(61,383	)		A		22,783
Total operating expenses		516,175			3,739,144			(516,175	)				3,739,144
Operating loss		(467,958	)		(3,053,613	)		467,958					(3,053,613	)

Other income (expense):
Other income		22,138			-0-			(22,138	)		A		-0-
Interest expense		(64,086	)		-0-			64,086			A		-0-
Total other income (expense)		(41,948	)		-0-			41,948					-0-
Loss from continuing operations
before taxes		(509,906	)		(3,053,613	)		509,906					(3,053,613	)
Provision for income taxes		-0-			-0-			-0-					-0-
Loss from continuing operations		(509,906	)		(3,053,613	)		509,906					(3,053,613	)

Discontinued operations:
Gain on disposal of
discontinued operations		259,693			-0-			(259,693	)		A		-0-
Loss from discontinued
operations		(445,161	)		-0-			445,161			A		-0-
Net loss from discontinued
operations		(185,468	)		-0-			185,468					-0-
Net loss	$	(695,374	)	$	(3,053,613	)	$	695,374				$	(3,053,613	)

Basic and diluted loss per common share												$	(0.04	)
Weighted average common shares outstanding, basic and diluted													81,204,766

(A)	The proforma adjustments represent the estimated proforma impact on the Company. These items were not incurred on a historical basis and we did not receive any historical benefits for these items in the historical period presented herein.