Other

Exhibit (a)(1)(i)

CUMBERLAND PHARMACEUTICALS INC.

OFFER TO EXCHANGE

RESTRICTED STOCK

FOR

CERTAIN OUTSTANDING STOCK OPTIONS

THIS EXCHANGE PROGRAM AND ALL WITHDRAWAL RIGHTS EXPIRE

AT 11:59 p.m., U.S. EASTERN DAYLIGHT TIME, (“EDT”) ON MAY 21, 2012, UNLESS THIS EXCHANGE PROGRAM

IS EXTENDED OR TERMINATED (the “Expiration Date”).

The Date of this Offer is April 24, 2012

Cumberland Pharmaceuticals Inc., a Tennessee corporation, (together with its subsidiaries, “Cumberland,” “CPIX,” “Company,” “we,” “our” or “us”) is offering current employees, advisors and directors the opportunity to exchange certain outstanding stock option grants to purchase shares of our common stock granted under the 1999 Plan (the “1999 Plan”), the Amended and Restated 2007 Long-Term Incentive Compensation Plan (the “2007 Plan”) and Amended and Restated 2007 Directors’ Incentive Plan (the “2007 Directors’ Plan”) that have a per share exercise price of $9.00 or greater, which we refer to as an “Eligible Option Grant,” for restricted common stock, which is subject to vesting based on continued employment, or otherwise affiliated with the Company, for a specified period (the “Restricted Stock”). Former employees, directors and advisors are not eligible to participate in this offer to exchange. An Eligible Option Grant will be exchanged for Restricted Stock in the ratio of the number of shares of Restricted Stock as determined in the conversion table set forth in this Offer to Exchange for every stock option rounded to the nearest whole number (the “Conversion Factor”), on the terms and under the conditions set forth in this offer to exchange (the “Offer to Exchange”). We refer to this Offer to Exchange Eligible Option Grants for Restricted Stock in accordance with the terms and conditions of this Offer to Exchange as the “Exchange Program.” In this Offer to Exchange, when we refer to a “Section,” unless otherwise indicated, we are referring to a Section of the discussion in this Offer to Exchange under Part III, “The Exchange Program.”

The Conversion Factor for each stock option will vary depending on the grant date of the stock option and the exercise price of the option. The actual Conversion Factor for each grant and option price is set forth in the table in Part III (“The Exchange Program”) of this document.

Each Eligible Option Grant that may be exchanged pursuant to the Exchange Program was granted under the 1999 Plan, 2007 Plan or the 2007 Directors’ Plan. Restricted Stock will be granted under the 2007 Plan and 2007 Directors’ Plan, respectively, upon the terms and subject to the conditions set forth in this Offer to Exchange, the related Cumberland Pharmaceuticals Inc. Stock Option Exchange Program Election Form (the “Election Form”), the related Cumberland Pharmaceuticals Inc. Eligible Option Grant and Restricted Stock Information Sheet (the “Information Sheet”) and the 2007 Plan and 2007 Directors’ Plan. Participation in the Exchange Program is voluntary.

Unless extended or terminated, this Exchange Program will expire at 11:59 p.m. EDT on May 21, 2012.

An individual will be eligible to participate in the Exchange Program, provided that, during the entire period commencing on and including April 24, 2012 through the date the Restricted Stock is granted under the Exchange Program, which we refer to as the “Eligibility Period,” he or she satisfies all of the following conditions:

An employee, director or consultant who meets the preceding eligibility conditions is referred to in this Offer to Exchange as an “Eligible Person.” In this Offer to Exchange, we use the term “Eligible Option Grant” to mean one or more stock option grants that give the holder the right to purchase a specified number of shares of our common stock at an exercise price equal to or greater than the threshold price of $9.00, were granted under our 1999 Plan, 2007 Plan or 2007 Directors’ Plan, and are held by “Eligible Persons.” If you are an Eligible Person you may tender for exchange any Eligible Option Grant or none at all. However, if you choose to tender an Eligible Option Grant, you must tender the entire outstanding, unexercised portion of that Eligible Option Grant. We will not accept any partial tenders of an Eligible Option Grant.

For purposes of this Exchange Program, the threshold price is U.S. $9.00, which represents a stock price that is approximately 18% greater than the closing stock price, as reported on the NASDAQ, on April 23, 2012.

Each Eligible Person who participates in the Exchange Program will receive Restricted Stock based on the Conversion Factor and the number of stock options provided by the Eligible Option Grant that is tendered and accepted by the Company for exchange in accordance with the terms of the Exchange Program.

Each Eligible Option Grant that is accepted for exchange pursuant to the Exchange Program will be canceled following the expiration of the Exchange Program, currently scheduled to expire at 11:59 p.m. EDT on May 21, 2012. An Eligible Option Grant that is accepted for exchange will no longer be exercisable after the expiration of the Exchange Program, unless the individual who tendered it for exchange ceases to be an Eligible Person before the end of the Eligibility Period, in which event the Eligible Option Grant will remain outstanding and exercisable in accordance with its terms notwithstanding any action the Company may have taken to cancel the Eligible Option Grant or issue Restricted Stock and the holder of such Eligible Option Grant will not be eligible to receive Restricted Stock under the Exchange Program.

If a tendering individual elects to exchange an Eligible Option Grant pursuant to the Exchange Program, his or her election is accepted by the Company, and such individual remains an Eligible Person through the end of the Eligibility Period, for Eligible Option Grant tendered we will grant the tendering individual an amount of Restricted Stock under the 2007 Plan or 2007 Directors’ Plan, respectively, in accordance with the Conversion Factor.

Each share of Restricted Stock granted pursuant to the Exchange Program will be subject to the terms of the 2007 Plan, if the tendering individual is a current employee or advisor of the Company, or the 2007 Directors’ Plan, if the tendering individual is a non-employee director of the Company, and an award agreement by and between you and CPIX (a form of which is attached hereto) and will:

The Company will provide you with a printed Information Sheet identifying your Eligible Option Grants subject to the Exchange Program.

To inform yourself about the Exchange Program, you should:

We are making this offer upon the terms and conditions described in this Offer to Exchange, the Election Form and Eligible Option Grant and Restricted Stock Information Sheet. The Exchange Program is not conditioned on any minimum number of options being exchanged. Our offer is, however, subject to conditions that we describe in Part III, Section 7 (Conditions of this Exchange Program) of this document.

Participation in this Exchange Program is voluntary, and there are no penalties for electing not to participate. If you choose not to participate in the Exchange Program, you will not receive Restricted Stock, and your outstanding Eligible Option Grant(s) will remain outstanding according to their existing terms and conditions.

If you wish to participate in the Exchange Program, an Election Form and Information Sheet are included with this Offer to Exchange. The Election Form and Information Sheet must be sent to Cumberland Pharmaceuticals Inc. by e-mail to optionexchange@cumberlandpharma.com . The subject line of the email must state: “Exchange Program.”

The Election Form and Information Sheet should not be sent via inter-office mail or hand delivered.

To participate, your Election Form and Information Sheet must be received by the Company no later than 11:59 p.m. EDT on May 21, 2012, unless this Exchange Program is extended. You will receive a confirmation by email after our receipt of your completed Election Form and Information Sheet. If an Eligible Option Grant is properly tendered for exchange under the Exchange Program, is not properly withdrawn and is accepted by the Company prior to the Expiration Date, you will receive a final confirmation notice confirming that your Eligible Option Grant has been accepted for exchange and canceled.

Shares of our common stock are quoted on NASDAQ under the symbol “CPIX”. On April 23, 2012, the closing price of one share of common stock on the NASDAQ was $7.60.

We recommend that you obtain current market quotations for our common stock before tendering your final election to participate in the Exchange Program.

IMPORTANT NOTICE

Although our Board of Directors has approved this Exchange Program, neither we nor our Board of Directors makes any recommendation to you as to whether or not you should elect to exchange your Eligible Option Grant. Also, we have not authorized any person to make any recommendation on its behalf as to whether or not you should accept this offer.

You must make your own personal decision whether to participate in the Exchange Program . In doing so, you should rely only on the information contained in the Offer to Exchange materials, the materials referenced in Section 16 of Part III of this Offer to Exchange, any official question and answer session organized by our Chief Executive Officer, or any other authorized communications from us made generally available to eligible employees, directors or advisors, as no other representations or information have been authorized by us. We recommend that you consult with your own advisors, including your tax advisor and financial advisor, before making any decisions regarding the Exchange Program.

The Restricted Stock we are offering may ultimately be worth more or less than your existing options. In evaluating this offer, you should keep in mind that the future performance of the Company and its stock will depend upon, among other factors, the future overall economic environment, the performance of the overall stock market and companies in our sector, the performance of our own business and the other risks and uncertainties set forth in our filings with the U.S. Securities and Exchange Commission. In particular, we recommend that you read our Annual Report on Form 10-K for the fiscal year ended December 31, 2011, which has been filed with the U.S. Securities and Exchange Commission and is available free of charge on the Internet at www.sec.gov.

The statements in this document concerning the Eligible Option Grants, the 2007 Plan and 2007 Directors’ Plan and the Restricted Stock are summaries of the material terms but are not complete descriptions of the Eligible Option Grants, the 2007 Plan and 2007 Directors’ Plan, or the Restricted Stock. The stock plan under which the Eligible Option Grants were granted, the 1999 Plan, 2007 Plan and 2007 Directors’ Plan and the forms of award agreement have been filed as exhibits to our Tender Offer Statement on Schedule TO filed with the U.S. Securities and Exchange Commission (to which this document is also an exhibit). See Part III, Section 16 of this Offer to Exchange for additional information regarding the Schedule TO.

Our Exchange Program is not being made to, and we will not accept any election to exchange Eligible Option Grants from or on behalf of, option holders in any jurisdiction in which our making the Offer to Exchange or accepting any tendered options for exchange is or would be illegal. However, we may in our sole discretion take the actions we deem necessary for us to make this Offer to Exchange to option holders in such jurisdiction.

TABLE OF CONTENTS

I. SUMMARY TERM SHEET

The following are answers to some of the questions you may have about this Exchange Program.

We urge you to read the following questions and answers carefully. We also urge you to read the remainder of this Offer to Exchange, which provides a more complete description of the topics discussed in this Summary Term Sheet, the Election Form, Information Sheet, and to review the 2007 Plan and 2007 Directors’ Plan and the form of our Restricted Stock Agreement attached as Exhibit (d)(3) to our Schedule TO for full details of the rights afforded to recipients of Restricted Stock. Copies of such documents are available to you free of charge by writing to 2525 West End Avenue, Suite 950, Nashville, Tennessee 37203, Attn.: Michelle Mays, or are available on the SEC’s website at www.sec.gov.

Because each of you is in a different financial situation, we suggest that you consult with your personal financial and tax advisors before deciding whether or not to participate in the Exchange Program. Please review these questions and answers and the other materials provided to ensure that you are making an informed decision regarding whether or not to participate in the Exchange Program.

The questions and answers have been separated into three categories: Exchange Program Design and Purpose; Administration and Timing of Exchange Program; and Other Important Questions.

INDEX TO SUMMARY TERM SHEET

1

References in this document to “CPIX,” the “Company,” “we,” “us” and “our” mean Cumberland Pharmaceuticals Inc., and references to the “Expiration Date” mean 11:59 p.m., EDT, on May 21, 2012, or, if we extend the offer period, any later date that we specify. References to the “Offer to Exchange” mean this document and its appendices. References to the Exchange Program mean the Exchange Program described in the Offer to Exchange.

2

References to dollars (“$”) are to United States dollars.

EXCHANGE PROGRAM DESIGN AND PURPOSE

The Exchange Program is a program being offered by the Company to allow Eligible Persons to exchange their Eligible Option Grants for Restricted Stock subject to the terms of the Offer to Exchange. The Exchange Program is voluntary and will allow Eligible Persons to choose whether to keep their Eligible Option Grants under their original terms, or to exchange any, all or none of their Eligible Option Grants for Restricted Stock. The decision to participate in the Exchange Program must be yours.

Many of our current employees and advisors now hold stock options which were granted under our 2007 Plan and many of our current non-employee directors now hold stock options which were granted under our 2007 Directors’ Plan, each at various per share exercise prices and many of these stock options are now significantly “underwater” or “out-of-the-money”, meaning they have exercise prices higher than the current market price of our common stock. As a result, we believe that the Eligible Option Grants have become ineffective in providing the necessary incentives and retention value, both to the Company and these individuals. The purpose of this Exchange Program is to address these issues by providing a way for Eligible Persons to exchange their “out-of-the-money” stock options for Restricted Stock, if they choose to do so. Please review the information in Part III, Section 2 (“Purpose of this Exchange Program”) for further discussion of the purpose for conducting the Exchange Program.

Only “Eligible Options Grants” may be exchanged under this program. Eligible Option Grants are stock options granted under our 1999 Plan, 2007 Plan or 2007 Directors’ Plan that give the holder the right to purchase a specified number of shares of our common stock at an exercise price equal to or greater than the “ threshold price ” and are held by “Eligible Persons.” The threshold price is $9.00, which represents a stock price that is approximately 18% greater than the closing stock price, as reported on the NASDAQ, on April 23, 2012.

An individual will be eligible to participate in the Exchange Program (an “Eligible Person”) provided that, during the entire period commencing on and including April 24, 2012 through the Expiration Date of the Exchange Program he or she satisfies all of the following conditions:

3

Former employees, directors and advisors are not eligible to participate in this offer to exchange.

Retirees, persons on short-term leave other than one of the short-term leaves described in the answer to Question 4 and Terminated employees are not eligible to participate in the Exchange Program:

A stock option or “option” is the right to purchase a share of common stock at a specified price, regardless of the actual market price of such common stock at the time the option is exercised. Typically, the specified purchase, or “exercise,” price is the market price of a share of our common stock on the date the option was granted. Due to subsequent fluctuations, at any given time following the grant of the option, the prevailing market price of the stock may be greater than, equal to, or less than, the specified exercise price of the option. When the market price is greater than the exercise price of the option (otherwise known as an “in-the-money” option), the option holder receives value from exercising the option, because he or she is able to buy the stock underlying the option at less than its prevailing market price and then sell the purchased stock for the higher prevailing market price. Conversely, when the market price is less than the exercise price of the option (otherwise known as an “out-of-the-money” or an “underwater” option), the holder generally would not exercise the stock option, since it would generally be considered uneconomic to do so. The options eligible for exchange under this Exchange Program currently are, and have for some time been, “out-of-the-money”.

Shares of Restricted Stock granted pursuant to this Exchange Program and the 2007 Plan and 2007 Directors’ Plan are shares of our common stock that will be issued to you, but subject to vesting based on continued employment for a specified period. Until the shares of Restricted Stock have vested, they remain subject to restrictions on transfer and subject to forfeiture upon termination of employment. If and when the shares vest, they will no longer be “restricted,” and you will be free to hold, transfer or sell them, subject to required tax withholding and compliance with applicable securities laws, our insider securities trading policies, if applicable, and any other legal requirements.

When the market price of our common stock declines below the applicable option exercise price of a stock option grant, the stock option grant would generally have no realizable value. In contrast, Restricted Stock continues to have value even if the market price of our stock has declined below its value at the time of grant. If however, our common stock price increases significantly, the Eligible Option Grant(s) you currently hold may have greater potential value, because the underlying shares are greater in number than the Restricted Stock for which they can be exchanged. However, the Restricted Stock you would receive under the Exchange Program if you choose to participate, will likely have greater value, if our common stock price does not increase significantly, provided you hold the Restricted Stock for the applicable vesting period. Please see questions 45 and 46 for a discussion of the income tax differences of Restricted Stock and your Eligible Option Grants.

4

No. You may exchange one or more of your Eligible Option Grants, or none at all. However, if you choose to tender an Eligible Option Grant for exchange, you must tender the entire outstanding, unexercised portion of that specific option grant. For the purposes of this Exchange Program, the term “option grant” means a particular option grant to purchase a specified number of shares of our common stock at a specified grant date exercise price per share, vesting schedule and termination date. We will not accept partial tenders of any specific Eligible Option Grant. If you attempt to tender for exchange less than the entire outstanding unexercised portion of an Eligible Option Grant, we will reject your tender of that particular grant in its entirety. Any such rejection will not affect any other Eligible Option Grant that you properly tender.

Yes. Your Eligible Option Grants do not need to be vested in order for you to participate in the Exchange Program. However, if you choose to tender a particular outstanding Eligible Option Grant, you must tender the entire unexercised Eligible Option Grant, both the vested and unvested portions.

No. The Exchange Program pertains only to outstanding options. It does not apply in any way to shares you have already purchased, whether upon the exercise of options or otherwise, or whether or not you have vested in those shares. If you have exercised an option in its entirety, that option is no longer outstanding and is therefore not eligible for this Exchange Program. However, if you have exercised an option grant in part, the remaining unexercised portion of that option is outstanding and may be tendered for exchange if the option grant is an Eligible Option Grant. Any Eligible Option Grant for which you have properly submitted an exercise notice prior to the time the Exchange Program expires will be considered exercised to the extent described in such exercise notice, whether or not you have received confirmation of exercise for the shares purchased.

Each share of Restricted Stock will be unvested at the time it is granted and will become vested on the basis of the Eligible Person’s continued service with the Company in accordance with and subject to the terms of the Offer to Exchange. For non-employee directors, the Restricted Stock will vest 100% on the one year anniversary of the grant date. For employee directors, employees and advisors, the Restricted Stock will vest 100% on the fourth anniversary of the grant date.

Two of the principal purposes of our stock-based compensation program are to align the interests of our employees, directors and advisors with those of our stockholders and to retain the services of these individuals for the benefit of the Company. We believe that anything shorter than the vesting requirements described in Question 12 would not adequately allow us to further these objectives. You should carefully consider the risks of exchanging vested options for unvested Restricted Stock and consult with your personal advisors regarding this topic. (See Question 12)

5

To calculate the number of shares of Restricted Stock each Eligible Person will be entitled to under the Exchange Program, the Compensation Committee of the Board of Directors (the “Committee”) formulated the “Conversion Factor.” The Conversion Factor for each stock option will vary depending on the grant date of the stock option and the exercise price of the option. Please refer to the conversion table in Part III (“The Exchange Program”). For example, the Conversion Factor for an option with an exercise price of $9.00 per share granted on 7/20/2005 will have a conversion factor of 0.217, while one granted on 9/1/2006 will have a conversion factor of 0.3463. To determine the actual number of shares of Restricted Stock you would be entitled to in the Offer to Exchange, you would multiply the actual number of options you would be entitled to under your grant on your grant date times the Conversion Factor. So, if you received an award of 1,000 options on 7/31/2008 with an exercise price of $13.00 per share, you would be entitled to receive 532 shares of Restricted Stock (i.e. 1,000 options times the Conversion Factor of 0.5325) assuming you elected to participate in the Offer to Exchange.

The Black-Scholes valuation model is a widely-used and generally accepted option valuation methodology that provides an estimate of the fair value of a stock option. Although it is the same model we use to value our stock options for financial reporting purposes, it is not an exact science and is subject to limitations in estimating fair values.

6

No. An Eligible Person who elects to participate in the Exchange Program is not required to pay any money to receive shares of Restricted Stock.

Yes. Exchanging your Eligible Option Grant does have some risks. You should carefully review the discussion of certain of these risks in Part II “Risk Factors” of this Offer to Exchange and consult with your advisors regarding any risks associated with the Exchange Program.

An additional grant of options to all Eligible Persons could have a negative effect on our stock dilution, outstanding shares and share price.

To participate in the Exchange Program, you must qualify as an Eligible Person throughout the entire Eligibility Period which runs from and includes the date this Exchange Program commences (April 24, 2012), through the date the Restricted Stock is granted (currently anticipated to be May 21, 2012). If you are not an Eligible Person throughout the entire Eligibility Period, as defined, any election you make to participate in this Exchange Program will be automatically voided and your existing Eligible Option Grants will remain outstanding and unchanged, subject to the terms of the original award.

No. Your participation in the Exchange Program gives you no legal or other right to continued employment for any period.

If you are not an Eligible Person at any time during the Eligibility Period, including on the date Restricted Stock is granted (currently anticipated to be May 21, 2012), any election you make to participate in the Exchange Program will be automatically void and the Eligible Option Grant you tendered for exchange will remain outstanding, in accordance with the terms and conditions of the applicable option grant document for the Eligible Option Grant. If you die during the Eligibility Period or become disabled (as defined under the 2007 Plan and 2007 Directors’ Plan, respectively), your most recent election, if any, will remain in effect.

Eligible Option Grants that are accepted for exchange under the Exchange Program will be canceled on the date the Restricted Stock is granted, which is expected to be the Expiration Date of the Exchange Program, May 21, 2012. The shares of Cumberland Pharmaceuticals Inc.’s common stock underlying any canceled Eligible Option Grant will be available to be awarded under the 2007 Plan and 2007 Directors’ Plan, respectively.

Eligible Option Grants that are not exchanged will remain outstanding and retain their existing terms, including the existing exercise price, vesting schedule and expiration date.

7

Participation or non-participation in the Exchange Program will have no effect on the Company’s consideration of your possible future equity awards, if any.

Our Board of Directors is not making a recommendation about this Exchange Program. Although our Board of Directors has approved this Exchange Program, they recognize that the decision to accept or reject this Exchange Program is an individual one that should be based on a variety of factors, including but not limited to your own personal circumstances and preferences, tax effects and your knowledge of the Company. You should consult with your personal advisors if you have questions about your financial or tax situation. Neither we, nor the Committee, nor our Board of Directors are making a recommendation as to whether or not to participate in this Exchange Program, nor do we possess the specialized and personal knowledge of your individual facts and circumstances necessary to advise you on your decision to participate.

Yes. Your evaluation of whether to accept or reject this Exchange Program should take into account the factors described in the Offer to Exchange, as well as the various risks and uncertainties inherent in our business. Business risks, industry risks and stock price risks associated with our Company include, but are not limited to, those risks set forth in our Annual Report on Form 10-K for the fiscal year ended December 31, 2011. In addition, before making your decision to tender your Eligible Option Grants, you should carefully review the information about the Company discussed in Part II, “Risk Factors” and in Part III, Section 9 (“Information Concerning Cumberland Pharmaceuticals Inc.”) of this document. This information includes an update on recent events affecting our business and explains where you can find additional information about us.

This Exchange Program is subject to a number of conditions, including the conditions described in Part III, Section 7 (“Conditions of this Exchange Program”). Please read this entire Offer to Exchange for a full description of all of the terms and conditions of this Exchange Program.

ADMINISTRATION AND TIMING OF EXCHANGE PROGRAM

Election instructions along with the required documentation to make your exchange election(s) are enclosed with the Offer to Exchange. If you elect to participate in the Exchange Program, you must properly complete the individualized Election Form and Information Sheet included with this Offer to Exchange and submit such Election Form and Information Sheet to the Company, which must be received by us no later than 11:59 p.m. EDT on May 21, 2012, unless this Exchange Program is extended. Election Forms and Information Sheets must be submitted by email to optionexchange@cumberlandpharma.com. The subject line of the email must state: “Exchange Program.” If you have any questions about the election process, please send an e-mail directly to mmays@cumberlandpharma.com. Please review the discussion in Part III, Section 3 (“Procedures for Electing to Exchange an Eligible Option Grant”) for further information.

8

You will receive a notice of confirmation by email after we receive your completed Election Form and Information Sheet. If you do not receive a confirmation, please call (615) 255-0068 or send an email directly to mmays@cumberlandpharma.com.

No. You are not required to return or submit any documents to us if you do not wish to exchange any of your Eligible Option Grants in this Exchange Program. If you do not return or submit the Election Form, you will not participate in the Exchange Program. This Exchange Program is completely voluntary, and there are no penalties for electing not to participate in the Exchange Program.

If your Eligible Option Grant was properly tendered for exchange and accepted by the Company for exchange, you will receive a final confirmation notice following the Expiration Date of the Exchange Program. The final confirmation notice will confirm that the Eligible Option Grant has been accepted for exchange and canceled, and will set forth the number of shares of Restricted Stock that have been granted to you in accordance with the Exchange Program.

We reserve the right to reject any or all Eligible Option Grants tendered for exchange that we determine is not in appropriate form or that we determine are unlawful to accept. Subject to our rights to extend, terminate and amend this Exchange Program, we currently expect that we will accept, promptly after the Expiration Date of this Exchange Program, all Eligible Option Grants properly tendered for exchange that are not validly withdrawn.

No. You do not need to submit any option grant documents in order to tender an Eligible Option Grant for exchange.

The deadline to participate in the Exchange Program is 11:59 p.m. EDT on May 21, 2012 unless this Exchange Program is extended by us. This means that your completed Election Form and Information Sheet must be received by the Company before the Expiration Date. Please review the discussion in Part III, Section 3 (“Procedures for Electing to Exchange an Eligible Option Grant”) for further information.

We may, in our discretion, extend this Exchange Program at any time, but we cannot assure you that this Exchange Program will be extended or, if extended, for how long. If this Exchange Program is extended, we will make a public announcement of the extension as described in Part III, Section 14 of the Offer to Exchange (“Extension of this Exchange Program; Termination; Amendment”). If this Exchange Program is extended, you must deliver your Election Form and Information Sheet before the time to which this Exchange Program is extended.

9

If your Election Form and Information Sheet is not received by us by the deadline, then you will not be able to participate in the Exchange Program and your Eligible Option Grants will remain unchanged, including the exercise price and number of underlying shares.

Yes. You may withdraw or change a previously submitted election to exchange Eligible Option Grants at any time before 11:59 p.m. EDT on May 21, 2012, as described in the Offer to Exchange. If this Exchange Program is extended by us beyond that time, you can withdraw or change your election at any time before the date to which this Exchange Program is extended. To withdraw or change your previously submitted Election Form and Information Sheet, you must request a replacement Election Form and Information Sheet and submit such replacement documents in the same manner set forth in the answer to Question 28. In order for such withdrawal to be accepted, we must receive the replacement Election Form and Information Sheet before the expiration of this Exchange Program at 11:59 p.m. EDT on May 21, 2012. It is your responsibility to confirm that we have received your replacement Election Form and Information Sheet before the expiration of this Exchange Program. In all cases, the last Election Form and Information Sheet submitted and received prior to the expiration of this Exchange Program will prevail.

Yes, any remaining outstanding, unexercised options of your Eligible Option Grant may be exchanged.

No. If you choose to exchange an Eligible Option Grant, you must exchange the entire outstanding, unexercised option grant.

Yes. Each Eligible Option Grant may consist of both vested and unvested options. The Eligible Option Grant must be exchanged in its entirety, whether or not it is fully vested. Each share of Restricted Stock will be unvested at the time it is granted and will become vested according to a new vesting schedule described in the answer to Question 12. See also the response to Question 14.

We will grant the Restricted Stock shortly following the time the Eligible Option Grants you tendered to exchange are accepted and canceled. If this Exchange Program expires on May 21, 2012, we would expect the exchange and the grant of the Restricted Stock to occur on that day. Grant documents for the Restricted Stock will be delivered to you shortly thereafter.

The Restricted Stock issued under the Exchange Program will be issued pursuant to our 2007 Plan and 2007 Directors’ Plan.

10

OTHER IMPORTANT QUESTIONS

You will generally forfeit any Restricted Stock that is not vested on the day you stop being an employee, or otherwise affiliated with the Company. Any vested shares you hold are yours to keep even after you leave the Company. If you elect to keep (i.e., to not exchange) all or some of your Eligible Option Grants, your option agreements generally provide that you have a limited period of time after your final day of employment with us to exercise your stock options to the extent that they are vested. If you do not exercise them within that limited time period, you will forfeit all unexercised options, whether vested or unvested, and will not receive any compensation for such forfeited options.

A “Change in Control” is defined in each of the 2007 Plan and the 2007 Directors’ Plan as (1) any merger or consolidation that results in the voting securities of the Company immediately prior thereto representing less than 50% of the combined voting power of the voting securities of the Company or such surviving or acquiring entity outstanding immediately after such merger or consolidation; or (2) the acquisition by an individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a “Person”) of beneficial ownership of any capital stock of the Company if, after such acquisition, such Person beneficially owns (within the meaning of Rule 13d-3 promulgated under the Exchange Act) 51% or more of either (A) the then-outstanding shares of Stock of the Company, or (B) the combined voting power of the then-outstanding voting securities of the Company entitled to vote generally in the election of Directors; or (3) the sale, transfer or other disposition of all or substantially all of the Company’s assets; or (4) the complete liquidation of the Company. A transaction shall not constitute a Change in Control if its sole purpose is to change the state of the Company’s incorporation or to create a holding company that will be owned in substantially the same proportions by the persons who held the Company’s securities immediately before such transaction.

Upon the occurrence of a Change in Control Event, except to the extent specifically provided to the contrary in the instrument evidencing any Restricted Stock award or any other agreement between a holder of a Restricted Stock award and the Company, all restrictions and conditions on all Restricted Stock awards then outstanding shall automatically be deemed terminated or satisfied and all such Restricted Stock shall be fully vested.

During the restriction period, if your employment or service terminates due to death or on account of a physical or mental impairment that renders you incapable of performing each of the material and substantial duties of your current position with the Company, the Restricted Stock will immediately revert to the Company and any rights of the grantee in such Restricted Stock shall automatically terminate.

We believe that under current U.S. law, you will incur no immediate U.S. federal income tax consequences as a result of either electing to retain your Eligible Option Grant or electing to exchange your Eligible Option Grant for shares of Restricted Stock. However, making an election under Section 83(b) of the Internal Revenue Code or the vesting of the shares of Restricted Stock in the absence of a Section 83(b) election would have tax consequences to you. Please see the response to Question 46 for further information regarding the income tax consequences of your Restricted Stock. You should consult with your personal advisors about your financial and tax situation.

Please review the discussion in Part II under the heading “TAX-RELATED RISKS FOR U.S. RESIDENTS” for information regarding the income tax consequences of restricted common stock grants and stock option grants.

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The discussion regarding tax-related risks for U.S. residents in Part II (“Risk Factors”) only summarizes the material U.S. federal income tax consequences of restricted common stock grants and stock option grants and the material U.S. federal income tax laws and regulations that apply to these awards. The discussion does not address all possible tax aspects of transactions that may arise in connection with these awards, including state or local tax consequences, federal alternative minimum tax considerations, or any international tax consequences. The tax laws and regulations are complex and are subject to changes. Any such changes could apply on a retroactive basis and could affect the U.S. federal income taxes described below. In addition, circumstances unique to certain individuals may change the usual income tax results.

For our employees who are subject to U.S. income taxation (and have not made a valid election under Section 83(b) of the Code), at the time your shares of Restricted Stock vest, you will be required to recognize taxable income. The Internal Revenue Services imposes on us an obligation to withhold income and employment taxes for employees, much like the obligation that arises when we pay you your salary. Until these tax withholding requirements are satisfied, we will have no obligation to release the shares to you. If you are an independent contractor, and not an employee, we do not have a withholding obligation and you should discuss with your tax advisor how to address estimated tax payments and other tax issues.

We intend to provide for the satisfaction of the tax withholding requirements by withholding from the number of shares of our common stock that would otherwise be released to you upon vesting under your restricted stock award a number of shares (rounded up to the next whole share) determined by multiplying the number of shares becoming vested by the combined minimum statutory income and employment tax withholding rates applicable to you. If for any reason, we are prevented from satisfying our tax withholding obligations in full or in part through this share withholding procedure, you would be required to pay by personal check any additional required withholding tax. In addition, you will authorize us to withhold from your first paycheck (and subsequent paychecks if necessary) following the vesting date, or to instruct your broker to sell on your behalf a number of shares in an amount sufficient to satisfy any unsatisfied portion of your required tax withholding.

If your employment with us is terminated for any reason after you have received shares of common stock but before you have satisfied your income and employment withholding tax obligation, you will authorize us to instruct your broker to sell on your behalf a number of shares sufficient to satisfy your income and employment tax obligation, and we will deduct the entire amount of any remaining tax obligation from your final paycheck.

For directors and advisors, we encourage you to consult with your personal tax advisor if you have questions about your financial or tax situation

The decision to participate must be each Eligible Person’s personal decision, and should depend largely on each Eligible Person’s assumptions about the performance of publicly-traded stocks generally, our own stock price and our business. We suggest that you consult with your personal financial and tax advisors before deciding whether or not to participate in the Exchange Program.

For additional information or assistance, you should call Michelle Mays at (615) 255-0068 or send an email to mmays@cumberlandpharma.com.

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In addition to these resources, we also plan to arrange for question and answer sessions about this exchange program. These sessions will not be a solicitation or make any recommendations whatsoever with respect to the offer. For example, we will not be able to answer questions about your personal situation or otherwise provide an assessment of the merits of this offer. You should consult your personal advisors if you have any questions about your financial or tax situation. We will be providing you information about the timing and location of the question and answer session in the coming days.

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II. RISK FACTORS

Participation in the Exchange Program involves a number of potential risks and uncertainties, including those described below. The risks and uncertainties below and the risks and uncertainties set forth in our Annual Report on Form 10-K for the fiscal year ended December 31, 2011, filed with the U.S. Securities and Exchange Commission (“SEC”) on March 7, 2012, which is incorporated herein by reference, highlight the material risks of participating in the Exchange Program. Eligible Persons should consider these risks and uncertainties, among other things, and are encouraged to speak with a financial, tax or legal advisor as necessary before deciding whether or not to participate in the Exchange Program. In addition, we urge you to read all of the materials relating to the Exchange Program before deciding whether or not to tender your Eligible Option Grant for exchange.

ECONOMIC RISKS

The valuation methodology utilized to determine the Conversion Factor is based on the Black-Scholes option pricing model and does not necessarily reflect the actual value of your Eligible Option Grant.

The Conversion Factor was calculated on a grant by grant basis and varies based on the date of grant and the exercise price of each option. The Conversion Factor is defined as the ratio of the number of shares of Restricted Stock for every option to purchase each share under an Eligible Option Grant, and was determined on an individual grant basis. Therefore, all Eligible Option grants will have a different Conversion Factor, regardless of the underlying estimated fair value of any one Eligible Option grant. The individual Conversion Factor is calculated as the fair value of each option award using the Black Sholes Valuation divided by the Closing Stock Price on the date hereof.

You should be aware that option valuation is not an exact science. Although the Black-Scholes option pricing model is a standard and accepted model for determining the value of stock options, the utilization of different assumptions in the Black-Scholes option pricing model can produce significantly different results for the ultimate value of an option. Moreover, even experts can disagree on the correct assumptions to use for any particular option valuation exercise. The assumptions we used for purposes of this Exchange Program may not be the same as those used by others and, therefore, our valuation of the options and/or the Conversion Factor may not be consistent with those obtained using other valuation techniques or input assumptions and may not reflect the actual value of your Eligible Option Grant and whether or not your Eligible Option Grant has the same terms as the aggregate terms assumed in the Company’s pricing model.

Canceled Eligible Option Grants might have been worth more than the Restricted Stock you receive in the Exchange Program.

We cannot predict the future price of our common stock. It is possible over time that each Eligible Option Grant you tender for exchange will have had a greater value than the Restricted Stock you receive under this Exchange Program.

If you do not have an employment, directorship or advisory relationship with the Company for any reason on the date your Restricted Stock would otherwise vest you will forfeit any unvested Restricted Stock.

This means that if you quit for any reason, or we terminate your employment or advisory arrangement, with or without cause or notice, and you are not an employee or otherwise affiliated with the Company on the date your Restricted Stock would vest, you will forfeit the unvested Restricted Stock and will not receive anything for the options you tendered and we canceled. This Exchange Program is not a guarantee of employment for any period. Your employment relationship with the Company may be terminated at any time by either you or us, with or without cause or notice, subject to any employment agreement you may have with us.

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We will not grant restricted stock rights to you if we are prohibited by applicable laws or regulations.

Even if we accept your tendered options, we will not grant shares of restricted stock to you if we are prohibited by applicable laws, rules, regulations or policies from doing so. Such a prohibition could result from, among other things, changes in laws, SEC rules, regulations or policies or NASDAQ listing requirements.

TAX-RELATED RISKS FOR U.S. TAX RESIDENTS

General

When the Restricted Stock granted to you under your restricted stock award vests, you will generally recognize ordinary income equal to the fair market value of the vested shares. Any excess of the proceeds on a subsequent sale of the shares over their fair market value on the vesting date will be a capital gain, although you will be eligible for favorable long-term capital gain treatment only if you have held the shares for more than 12 months from the date of vesting.

Restricted Stock:

You will generally recognize no taxable income upon the receipt of shares of Restricted Stock ( i.e. , shares that are subject to a substantial risk of forfeiture and are not transferable). You will, however, recognize ordinary income (like salary) at the time the shares vest in an amount equal to the fair market value of those shares. We will determine the fair market value of the shares based on the closing price of our common stock as reported on the NASDAQ on each applicable vesting date. The ordinary income resulting from the vesting of shares of Restricted Stock will be reflected in the Form W-2 or Form 1099-MISC for nonemployee directors and advisors reported to the Internal Revenue Service for the year of the vesting of the shares. At the time that you recognize ordinary income, you will have income and employment withholding tax obligations with respect to that income, much like the obligation that arises when we pay you your remuneration. Although you make no affirmative election for this treatment, taxation is governed under Section 83(a) of the Internal Revenue Code.

Alternatively, you may choose to make an affirmative election, within 30 days of the grant date of your Restricted Stock, under Section 83(b) of the Internal Revenue Code, to include in your current year’s income the fair market value of the shares on the date they are transferred to you, rather than on the date that the shares vest . However, an individual making a Section 83(b) election would not be entitled to any deduction or credit for taxes paid in the year of acquisition if he or she subsequently forfeits unvested shares upon termination of employment or otherwise.  Furthermore, we recommend you consult with your tax advisors regarding any tax consequences of the receipt of the Restricted Stock, and making or not making an election under Section 83(b) of the Code .

If you do not make an election under Section 83(b) of the Internal Revenue Code, as your shares of Restricted Stock vest over time, you will be required to recognize taxable income currently recognized at ordinary income tax rates. Further, the income you recognize will be the fair market value of the Restricted Stock on the date of the vesting of the Restricted Stock. This means that we will have an obligation to withhold income and employment taxes for awards granted to employees, much like the obligation that arises when we pay you your salary. Until you have satisfied these tax withholding requirements, we will have no obligation to release shares to you. For directors and advisors, we are not obligated to withhold taxes on the vesting of the Restricted Stock.

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Unless you notify us otherwise, we intend to provide for the satisfaction of the tax withholding requirements by withholding from the number of shares of our common stock that would otherwise be released to you upon vesting under your Restricted Stock award a number of shares (rounded up to the next whole share) determined by multiplying the number of shares becoming vested by the combined minimum statutory income and employment tax withholding rates applicable to you. If for any reason, we are prevented from satisfying our tax withholding obligations in full or in part through this share withholding procedure, you would be required to pay by personal check any additional required withholding tax. In addition, you will authorize us to withhold from your first paycheck (and subsequent paychecks if necessary) following the vesting date, or to sell a number of shares in an amount sufficient to satisfy any unsatisfied portion of your required tax withholding.

If your employment with us is terminated for any reason after you have received shares of Restricted Stock, but before you have satisfied your income and employment withholding tax obligation, we will deduct the entire amount of any remaining tax obligation from your final paycheck, with the remainder, if any, being payable by you to us.

Stock Options:

Generally, the issuance of stock options or the vesting of stock options is not a taxable event. Stock options may be issued as Incentive Stock Options (“ISOs”) under the Internal Revenue Code or issued as non-qualified stock options (“NQSOs”). Although all of the Eligible Option Grants issued to you may be labeled as ISOs, some or all of the options in a grant may be disqualified, with the disqualified portion being treated as NQSOs.

Stock options that qualify as ISOs may provide an employee with significant tax benefits, by allowing the employee to exercise the stock options, in limited amounts, without being taxed as ordinary income on the intrinsic (or in-the-money) value on the exercise date. Additionally, long-term capital gains treatment is available if the exercised ISO shares are held one year from the date of the exercise or two years from the date the options were granted, whichever is later.

There can be significant disadvantages to ISOs. Among them is that the difference between the fair market value of the stock and the exercise price (the in-the-money amount), upon exercise, is includable in income for alternative minimum tax (AMT) purposes. Although current tax law allows the excess you might pay from your AMT tax liability over your ordinary tax liability to be “carried over” and possibly used in future years as an offset to your ordinary income tax liability, your exercising an ISO doesn’t generate any cash to you to pay any AMT tax liability. The problem can become worse if the sock price then falls before the share are sold, leaving you an AMT bill in the year of exercise, even though the stock actually produced no income.

NQSOs (non-qualified stock options), whether issued as NQSOs or issued as ISOs that became NQSOs, will generally require you to recognize ordinary income (like salary) equal to the intrinsic or in-the-money value of the option on the exercise date. The ordinary income resulting from the exercise of NQSOs will be reflected in your Form W-2 or Form 1099-MISC for the year, thereby notifying the IRS that your option was exercised. At the time that you recognize ordinary income, you will have income and employment withholding tax obligations with respect to that income, much like the obligation that arises when we pay you your salary. If after exercising your NQSO you hold your stock for the requisite holding period, any future sale of your stock may be more favorable taxable as long-term capital gains, with the exercise price becoming your basis for calculating your gain.

Tax Withholding

In most cases, at the time the shares of restricted stock vest, you will be responsible for FICA taxes. This generally would mean that 1.45% of the fair market value of the restricted stock at the time of vesting would have to be withheld in payment of Medicare tax. While you are also potentially subject to the larger old age and survivor component of FICA, this is true only to the extent your salary does not exceed the Social Security taxable wage

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base for that year ($110,100 for 2012). The timing of the vesting of the Restricted Stock or the Section 83(b) election would affect the old age and survivor component of FICA. In addition, you will have an income tax withholding obligation with respect to ordinary income you must recognize on the shares’ vesting date, much like the obligation that arises when we pay you your salary. We will be authorized under the 2007 Plan and 2007 Directors’ Plan and your restricted stock agreement to withhold shares having a value equal to your tax withholding requirement from the shares that would otherwise be released to you upon vesting. Alternatively, we may satisfy these tax withholding obligations by one of the methods described in the response to Part I, Question 47 and in Part III, Section 13 of the Offer to Exchange.

The income tax withholding may be insufficient to cover your final income tax liability with respect to the vesting of your shares. You should consult with your own tax advisor to determine whether you should make estimated tax payments for each year in which your shares vest.

You should review Part III, Section 13 of the Offer to Exchange carefully for a more detailed discussion of the potential consequences of participating in this offer. We recommend that you consult with your personal tax advisor before deciding whether or not to participate in the offer with respect to the tax consequences relating to your specific circumstances.

BUSINESS-RELATED RISKS

For a discussion of risks associated with our business, please see the discussion of risks related to our Company, industry and our common stock under the heading “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2011, filed with the SEC on March 7, 2012.

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III. THE EXCHANGE PROGRAM

SECTION 1. The Exchange Program; Eligibility; Expiration Date.

Cumberland Pharmaceuticals Inc., a Tennessee corporation, (together with its subsidiaries, “Cumberland,” “CPIX,” “Company,” “we,” “our” or “us”) is offering current employees, directors and advisors the opportunity to exchange certain outstanding stock option grants to purchase shares of our common stock granted under our 1999 Stock Option Plan (the “1999 Plan”), Amended and Restated 2007 Long-Term Incentive Compensation Plan (the “2007 Plan”) and Amended and Restated 2007 Directors’ Incentive Plan (the “2007 Directors’ Plan”), respectively, that have a per share exercise price of $9.00 or greater, which we refer to as an “Eligible Option Grant,” for restricted common stock, which is subject to vesting based on continued employment or affiliation for a specified period (the “Restricted Stock”). Former employees, directors and advisors are not eligible to participate in this offer to exchange.

To calculate the number of shares of Restricted Stock each Eligible Person will be entitled to under the Exchange Program, the Committee formulated the “Conversion Factor.” The Conversion Factor for each stock option will vary depending on the grant date of the stock option and the exercise price of the option. For example, the Conversion Factor for an option with an exercise price of $9.00 per share granted on 7/20/2005 will have a conversion factor of 0.2210, while one granted on 9/1/2006 will have a conversion factor of 0.3498. To determine the actual number of shares of Restricted Stock you would be entitled to in the Offer to Exchange, you would multiply the actual number of options you would be entitled to under your grant on your grant date times the Conversion Factor. So, if you received an award of 1,000 options on 7/31/2008 with an exercise price of $13.00 per share, you would be entitled to receive 534 shares of Restricted Stock (i.e. 1,000 options times the Conversion Factor of 0.5342) assuming you elected to participate in the Offer to Exchange. The following table sets for the actual number of shares of Restricted Stock you would be entitled to receive:

The Conversion Factor is defined as the ratio of the number of shares of Restricted Stock for every option to purchase each share under an Eligible Option Grant, and was determined on an individual grant basis. Therefore, all Eligible Option grants will have a different Conversion Factor, regardless of the underlying estimated fair value of any one Eligible Option grant. The individual Conversion Factor is calculated as the fair value of each option award using the Black Sholes Valuation divided by the Closing Stock Price on the date hereof.

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Each Eligible Option Grant that may be exchanged pursuant to the Exchange Program was granted under the 2007 Plan or the 2007 Directors’ Plan. Restricted Stock will be granted under the 2007 Plan to Eligible Persons who are employees or advisors of the Company and under the 2007 Directors’ Plan to Eligible Persons who are non-employee directors, upon the terms and subject to the conditions set forth in this Offer to Exchange, the related Cumberland Pharmaceuticals Inc. Stock Option Exchange Program Election Form (the “Election Form”), the related Cumberland Pharmaceuticals Inc. Eligible Option Grant and Restricted Stock Information Sheet (the “Information Sheet”) and the 2007 Plan and 2007 Directors’ Plan. Participation in the Exchange Program is voluntary.

Upon the terms and subject to the conditions of this Exchange Program, we will grant Restricted Stock in accordance with Part III, Section 8 and as authorized under the 2007 Plan and 2007 Directors’ Plan, respectively, in exchange for each Eligible Option Grant that is properly tendered for exchange and not validly withdrawn in accordance with Part III, Section 4 before the Expiration Date of the Exchange Program.

An employee, director or consultant of the Company will be an Eligible Person and eligible to participate in the Exchange Program, provided that, during the entire period commencing on and including April 24, 2012 through the date the Restricted Stock is granted (the “Eligibility Period”) he or she satisfies all of the following conditions:

Even if you are an Eligible Person when the Exchange Program commences on April 24, 2012, you will not be eligible to exchange your Eligible Option Grant for Restricted Stock unless you continue to meet all of the conditions of an Eligible Person throughout the entire Eligibility Period, as defined.

An Eligible Option Grant is a stock option granted under our 1999 Plan, 2007 Plan or our 2007 Directors’ Plan that gives the holder the right to purchase a specified number of shares of our common stock at an exercise price equal to or greater than the “threshold price” and are held by Eligible Persons. The threshold price is $9.00, which represents a stock price that is approximately 18% greater than the closing stock price, as reported on the NASDAQ, on April 23, 2012

This Exchange Program will expire at 11:59 p.m. EDT on May 21, 2012, unless and until we, in our sole discretion, extend the period of time during which this Exchange Program will remain open. If we extend the period during which this Exchange Program remains open, the new Expiration Date will be the latest time and date at which this Exchange Program, as so extended, expires. See Part III, Section 14 for a description of our rights to extend, delay, terminate and amend this Exchange Program.

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For any Eligible Option Grant you elect to exchange, you must exchange all of the unexercised stock options of the Eligible Option Grant in its entirety and you may not exchange any Eligible Option Grant with respect to only some of the unexercised option shares covered by that grant. If you have previously exercised a portion of an Eligible Option Grant, only the portion of that grant which has not been exercised will be eligible to be exchanged for Restricted Stock.

If you properly tender an Eligible Option Grant that is accepted for exchange, the exchanged grant will be canceled and, subject to the terms of this Exchange Program, you will be entitled to receive Restricted Stock under the 2007 Plan or the 2007 Directors’ Plan, respectively, in accordance with Part III, Section 8 as modified by the terms of the Restricted Stock Agreement in Exhibit (d)(5) hereto. An Eligible Option Grant that is accepted for exchange will no longer be exercisable after the Expiration Date, unless the individual who tendered it for exchange ceases to be an Eligible Person before the end of the Eligibility Period, as defined, (in which event the Eligible Option Grant will remain outstanding and exercisable in accordance with its terms notwithstanding any action the Company may have taken to cancel the Eligible Option Grant or issue Restricted Stock) or such individual properly withdraws the election as described in Part III, Section 4.

If we materially change the terms of this Exchange Program, or if we waive a material condition of this Exchange Program, we will extend the Exchange Program in accordance with applicable legal requirements. The amount of time by which we will extend this Exchange Program following a material change in the terms of the Exchange Program will depend on the facts and circumstances, including the relative materiality of such terms. If we materially change the terms of this Exchange Program we will publish notice or otherwise notify you of our action in writing, in accordance with applicable legal requirements.

SECTION 2.  Purpose of this Exchange Program.

We believe that an effective and competitive employee/advisor stock-based incentive compensation program and director stock-based incentive compensation program is very important to the future success of our business. We rely heavily on the specialized skills and expertise of our employees, advisors and directors to implement our strategic initiatives and develop our business. We believe stock-based compensation for employees, advisors and directors constitute a key part of our incentive and retention programs because such equity compensation encourages employees, advisors and directors to act like owners of the business, motivating them to work toward the success of the Company and rewarding their contributions by allowing them to benefit from increases in the value of our shares.

Many of our employees and advisors now hold stock options which were granted under our 1999 Plan, 2007 Plan and many of our non-employee directors now hold stock options which were granted under our 2007 Directors’ Plan, each at various per share exercise prices and these stock options are now, or recently have been, “underwater”, meaning they may have exercise prices significantly higher than the current market price of our common stock. As a result, we believe that the stock options have become ineffective at providing its intended incentives and retention value. The purpose of this Exchange Program is to address these issues by providing a way for eligible employees, advisors and directors to exchange their stock options for Restricted Stock, if they choose to do so.

SECTION 3.  Procedures for Electing to Exchange an Eligible Option Grant.

Proper Exchange of an Eligible Option Grant : An individualized Election Form and Information Sheet is included with this Offer to Exchange. If you elect to participate, you must complete and submit the enclosed Election Form and Information Sheet, which must be received by the Company no later than 11:59 p.m. EDT on May 21, 2012, unless this Exchange Program is extended. The Election Form and Information Sheet must be submitted by email to optionexchange@cumberlandpharma.com. The subject line of the email must state: “Exchange Program.”

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The Election Form and Information Sheet should not be sent via inter-office mail or hand delivered. If you have any questions about the election process, please send an e-mail directly to Michelle Mays at mmays@cumberlandpharma.com.

As mentioned above, your Election Form and Information Sheet must be received by the Company no later than 11:59 p.m. EDT on May 21, 2012, unless this Exchange Program is extended. You will receive a confirmation by email after our receipt of your completed Election Form and Information Sheet. If your Eligible Option Grant is properly tendered for exchange under the Exchange Program, is not withdrawn and is accepted by the Company prior to the Expiration Date, you will receive a final confirmation notice confirming that the Eligible Option Grant(s) have been accepted for exchange and canceled. The confirmation notice will also set forth the number of shares of Restricted Stock that have been granted to you under the Exchange Program.

If we do not receive your Election Form and Information Sheet by the Expiration Date, then you will not be able to participate in the Exchange Program, and each Eligible Option Grant currently held by you will remain intact with its original exercise price and with its other original terms.

Although the Election Form and Information Sheet must be submitted by email, the electing Eligible Person bears the risk and responsibility to allow sufficient time to ensure timely delivery to and receipt by the Company of any documents in connection with an election to participate in the Exchange Program.

Determination of Validity; Rejection of Options; Waiver of Defects; No Obligation to Give Notice of Defects . The Company will determine, in our sole discretion, all questions as to validity, form and eligibility under the Exchange Program, including time of receipt and acceptance of any documentation relating to the exchange of Eligible Option Grants. Our determination of these matters will be final, conclusive and binding on all persons, but may be challenged in a court of competent jurisdiction. We reserve the right to reject any or all Eligible Option Grants tendered for exchange that we determine are not in appropriate form or that we determine are unlawful to accept or are not timely received by the Company. We also reserve the right, in our reasonable discretion, to waive any of the conditions of this Exchange Program or any defect or irregularity in any tender of Eligible Option Grants for exchange. If we waive any of the conditions of this Exchange Program we will do so for all Eligible Persons. No tender of Eligible Option Grants for exchange will be deemed to have been properly made until all defects or irregularities have been cured by the electing option holder or waived by us. Neither we nor any other person is obligated to give notice of any defects or irregularities, nor will anyone incur any liability for failure to give any such notice.

Our Acceptance Constitutes an Agreement . Your election to exchange an Eligible Option Grant pursuant to the procedures described above constitutes your acceptance of the terms and conditions of this Exchange Program and an offer to exchange under the Exchange Program. Our acceptance of the Eligible Option Grant that you tender for exchange pursuant to this Exchange Program will constitute our binding agreement with you upon the terms and subject to the conditions of this Exchange Program.

Subject to our rights to extend, terminate and amend this Exchange Program, we currently expect that we will accept promptly after the Expiration Date all properly tendered Eligible Option Grants that have not been validly withdrawn.

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SECTION 4.  Withdrawal Rights.

You may withdraw your tendered Eligible Option Grant only in accordance with the provisions of this Section 4.

An Eligible Person who has submitted an Election Form and Information Sheet may withdraw any or all of the tendered Eligible Option Grant(s) at any time before the Expiration Date of the Exchange Program (11:59 p.m. EDT on May 21, 2012). If the Expiration Date is extended by us, you may withdraw any or all of your tendered Eligible Option Grants at any time until the expiration as extended for this Exchange Program.

To validly withdraw a tendered Eligible Option Grant, you must submit to the Company a replacement Election Form and Information Sheet implementing the same means used to submit the original Election Form and Information Sheet, and we must receive the replacement Election Form and Information Sheet before the Expiration Date of the Exchange Program. To constitute a proper notice of withdrawal, the replacement Election Form and Information Sheet must be properly completed and specifically decline to participate in the Exchange Program and be submitted in the manner set forth above in Part III, Section 3 for submission of an Election Form and Information Sheet.

It is your responsibility to confirm that the Company has received your replacement Election Form and Information Sheet indicating the withdrawal of any or all of your tendered Eligible Option Grant(s) before the Expiration Date. If you elect to withdraw an Eligible Option Grant, you must withdraw the entire grant. Withdrawals that follow the aforementioned procedures will be considered valid, and the applicable Eligible Option Grant will not be considered tendered for exchange. In order to subsequently exchange an Eligible Option Grant that was subject to a valid withdrawal, you must properly re-tender for exchange the Eligible Option Grant before the Expiration Time by following the procedures described in Part III, Section 3.

If your employment or affiliation with the Company terminates prior to the cancellation of options tendered pursuant to this offer, your tendered options will automatically be withdrawn. If automatically withdrawn, you may exercise those options to the extent they are vested at the time of your termination of employment, but only during the limited period for which those options remain exercisable pursuant to your stock option agreement following your termination.

Neither we nor any other person is obligated to give notice of any defects or irregularities in any Election Form or Information Sheet submitted to withdraw a previously tendered Eligible Option Grant, nor will anyone incur any liability for failure to give any such notice. We will determine, in our sole discretion, all questions as to the form and validity of a notice of withdrawal, including time of receipt. Our determination of these matters will be final, conclusive and binding, but may be challenged in a court of competent jurisdiction by any Eligible Person participating in the Exchange Program.

SECTION 5.  Acceptance of Eligible Option Grants for Exchange and Issuance of Restricted Stock.

Upon the terms and subject to the conditions of this Exchange Program and promptly following the Expiration Date, we will accept for exchange all Eligible Option Grants properly tendered and not validly withdrawn before the expiration of the offer. All Eligible Option Grants accepted by us pursuant to this Exchange Program will be canceled as of the date of acceptance, and you will no longer have any rights under those options. Restricted stock awards will be granted as of the date of our acceptance, which we expect to promptly follow the Expiration Date. If we accept and cancel options properly tendered for exchange after the Expiration Date, or if we extend the date by which we must accept and cancel options properly tendered for exchange, the time in which the restricted stock rights will be granted will be similarly delayed.

We will not accept partial tender of an Eligible Option Grant. However, you may tender the remaining portion of an Eligible Option Grant that you have partially exercised.

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For purposes of this Offer to Exchange, we will be deemed to have accepted for exchange Eligible Option Grants that are validly tendered and not properly withdrawn when we give final confirmation notice to tendering Eligible Persons of our acceptance. We will give final confirmation notice of our acceptance, which may be by inter-office mail, email, facsimile or press release, promptly following the Expiration Date.

All Restricted Stock awards will be granted under our 2007 Plan or 2007 Directors’ Plan, respectively, and will be subject to the terms and conditions of an award agreement between you and us (a form of which is attached hereto as Exhibit (d)(7). As promptly as practicable after the grant date, we will send you an award agreement (in the appropriate form filed as an exhibit to our Tender Offer Statement on Schedule TO but with all the blanks filled in). This agreement will be effective from and as of the grant date.

If you are not an Eligible Person on the Expiration Date or at any time during the Eligibility Period, as defined, your election to exchange your options will automatically be deemed void and this Exchange Program will not affect the terms of your existing Eligible Option Grants.

As of April 23, 2012, the closing price of our common stock as reported by NASDAQ was $7.60 per share. There is no established trading market for employee stock options to purchase shares of our common stock.

We recommend that you obtain current market quotations for our common stock before deciding whether to participate in the Exchange Program, and again immediately before your elections become final on the Expiration Date.

SECTION 7.  Conditions of this Exchange Program.

Notwithstanding any other provision of this Exchange Program, we will not be required to accept any Eligible Option Grants tendered for exchange. Further, we may terminate or amend this Exchange Program, or postpone our acceptance and cancellation of any Eligible Option Grants tendered for exchange, in each case subject to rules promulgated under the Exchange Act, if at any time on or after the date hereof and prior to the

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Expiration Date any of the following events has occurred, or has been determined by us to have occurred or likely to occur, and, in our reasonable judgment, makes it inadvisable to proceed with this Exchange Program:

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The conditions to this Exchange Program are for our benefit. We may assert them in our sole discretion when events occur that give rise to such conditions before the Expiration Date, so long as, such condition was not triggered as a result of any action or inaction by us. We may waive them, in whole or in part, at any time and from time to time prior to the Expiration Date, in our reasonable discretion, whether or not we waive any other condition to this Exchange Program. If a condition is triggered and we do not exercise any of our rights to terminate or amend this Exchange Program or postpone our acceptance and cancellation of any Eligible Option Grants tendered for exchange, such inaction shall be deemed a waiver of the triggering condition, and we shall notify all Eligible Persons of such waiver. Depending on the materiality of the waived condition and the number of days remaining in the offer, we may extend the offer and circulate disclosures and other Exchange Program documents to Eligible Persons as required by applicable securities laws. The waiver of any of these rights with respect to particular facts and circumstances shall not be deemed a waiver with respect to any other facts and circumstances. Any determination we make concerning the waiver or assertion by us of any of the conditions of this Offer will be final and binding upon all persons. Any Eligible Person participating in the Exchange Program may challenge the Company’s final determination in a court of competent jurisdiction.

SECTION 8.  Source and Amount of Consideration; Terms of Restricted Stock.

The Restricted Stock issued pursuant to this Exchange Program will be issued under the 2007 Plan or the 2007 Directors’ Plan, respectively.

The number of whole shares of Restricted Stock we will issue in exchange for each stock option will be determined based upon a “Conversion Factor” as previously defined in Part III (“The Exchange Program”).

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Each Eligible Person will receive an Information Sheet identifying the options held by the Eligible Person which have exercise prices equal to or greater than the Threshold Price of $9.00, and therefore are Eligible Option Grants.

The number of Restricted Stock you will be granted in exchange for an Eligible Option Grants will be determined as follows: mutiply (i) the number of stock options pursuant to your Eligible Option Grant by (ii) the Conversion Factor. We will not issue any Restricted Stock for fractional shares. Instead, in each case where the Conversion Factor yields a fractional amount of shares, we will round to the nearest whole number of shares.

Terms of Restricted Stock . The Restricted Stock issued pursuant to this Exchange Program will be issued under the 2007 Plan and 2007 Directors’ Plan, respectively, and will be subject to a Restricted Stock agreement between the Company and the Eligible Person. As promptly as practicable after the grant date, we will send to each recipient of Restricted Stock in this Exchange Program a completed Restricted Stock agreement, signed by our Chief Executive Officer and requiring the signature of the recipient, substantially in the form of Exhibit (d)(5) herein.

Each share of Restricted Stock will be unvested at the time it is granted and will become vested on the basis of the Eligible Person’s continued service with the Company in accordance with and subject to the terms of the Offer to Exchange. For directors, the Restricted Stock will vest 100% on the one year anniversary of the grant date. For non-employee directors, employees and advisors, the Restricted Stock will vest 100% on the fourth anniversary of the grant date.

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Income Tax Consequences of the Exchange Program . Please refer to Part III, Section 13 for a discussion of the material U.S. federal income tax consequences of the exchange of Eligible Options for Restricted Stock under this Exchange Program.

Registration and Sale of Restricted Stock . All shares of Restricted Stock issuable upon exchange of Eligible Options are granted under the 2007 Plan or the 2007 Directors’ Plan, respectively.

IMPORTANT NOTE: The statements in this Offer to Exchange concerning the 2007 Plan and 2007 Directors’ Plan and the Restricted Stock are subject to, and are qualified in their entirety by reference to, the provisions of the 2007 Plan and 2007 Directors’ Plan and the Restricted Stock Agreement. A copy of the 2007 Plan and 2007 Directors’ Plan and the form of Restricted Stock Agreement are attached hereto and are also available by contacting us at (615) 255-0068 or by writing to us at our principal executive offices at 2525 West End Avenue, Suite 950, Nashville, Tennessee 37203.

SECTION 9. Information Concerning Cumberland Pharmaceuticals Inc.

Cumberland Pharmaceuticals Inc., a Tennessee corporation is a growing specialty pharmaceutical company focused on the acquisition, development and commercialization of branded prescription products. The address of its principal executive office is 2525 West End Avenue, Suite 950, Nashville, Tennessee 37203. The telephone number at that address is (615) 255-0068.

Certain Financial Information . Set forth below is a summary of our financial information. This information is derived from and qualified by reference to our publicly available consolidated financial statements and should be read in conjunction with the financial statements, related notes and other financial information included in the sections entitled “Item 6. Selected Financial Data,” and “Item 8. Financial Statements” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2011, which is incorporated herein by reference. See Part III, Section 16 for instructions on how you can obtain copies of the SEC reports that contain our audited financial statements and unaudited financial information. For information regarding the accounting consequences of this Exchange Program, see Part III, Section 11.

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The following table sets forth selected consolidated financial information as of and for the fiscal years ended December 31, 2011, 2010, and 2009.

SECTION 10. Interests of Directors, Executive Officers and Affiliates; Transactions and Arrangements Concerning the Eligible Option Grants.

All of our executive officers and directors that hold Eligible Options are able to participate in the Offer. The following table sets forth the directors and executive officers of the Company and the number of Eligible Options as of April 23, 2012. We also refer you to our 2012 annual meeting proxy statement, filed with the SEC on March 12, 2012, for information concerning agreements, arrangements and understandings between the Company and other persons with respect to the Company’s common stock.

The address of each director and executive officer is: c/o Cumberland Pharmaceuticals Inc., 2525 West End Avenue, Suite 950, Nashville, Tennessee 37203. The telephone number for each Director and Executive Officer is (615) 255-0068.

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Neither we nor, to the best of our knowledge, were any of our executive officers or directors engaged in transactions involving Eligible Option Grants during the 60 days prior to April 24, 2012. For more detailed information on the beneficial ownership of our common stock by our directors and executive officers, you can consult the beneficial ownership table of our Definitive Proxy Statement for our 2012 Annual Meeting of Stockholders filed with the SEC on March 12, 2012, and incorporated herein by reference.

Except as described in this Offer to Exchange and except as set forth in our Annual Report on Form 10-K for the fiscal year ended December 31, 2011, or our Definitive Proxy Statement for our 2012 Annual Meeting of Stockholders, and other than outstanding options and other awards granted from time to time to certain of our employees (including executive officers) and our directors under our compensation and incentive plans, neither we nor any person controlling us nor, to our knowledge, any of our directors or executive officers, is a party to any contract, arrangement, understanding or relationship with any other person relating, directly or indirectly, to the Exchange Program with respect to any of our securities (including, but not limited to, any contract, arrangement, understanding or relationship concerning the transfer or the voting of any such securities, joint ventures, loan or option arrangements, puts or calls, guarantees of loans, guarantees against loss or the giving or withholding of proxies, consents or authorizations).

SECTION 11. Status of Eligible Option Grants Acquired by Us in this Exchange Program; Accounting Consequences of this Exchange Program

Each Eligible Option Grant that we acquire pursuant to this Exchange Program will be canceled. Subsequently, the shares of common stock that were subject to the canceled Eligible Option Grant will be available for future awards under our 2007 Plan and our 2007 Directors’ Plan.

We have adopted the provisions of Accounting Standards Codification (“ASC”) 718, Compensation – Stock Compensation . Under ASC 718, we will recognize the incremental compensation cost of the Restricted Stock granted in this Exchange Program. The incremental compensation cost will be measured as the excess, if any, of the fair value of the Restricted Stock granted in exchange for a surrendered Eligible Option Grant, over the fair value of the Eligible Option Grant surrendered in exchange for the Restricted Stock. The fair value of Restricted Stock will be measured as of the date they are granted and the fair value of the Eligible Option Grant surrendered will be measured immediately prior to the cancellation. This incremental compensation cost, along with any unrecognized compensation cost associated with the Eligible Option Grant, will be recognized in compensation expense ratably over the vesting period of the Restricted Stock. Since these assumptions and factors used to determine the fair value of the Eligible Option Grants and the Restricted Stock, including the number of Eligible Option Grants ultimately tendered in the Exchange Program, we cannot predict with any certainty at this time, the amount of incremental compensation expense until the Expiration Date of this Exchange Program.

SECTION 12. Legal Matters; Regulatory Approvals.

We are not aware of any license or regulatory permit that appears to be material to our business that might be adversely affected by our exchange of Restricted Stock for Eligible Option Grants as contemplated by this Exchange Program. If any approval or other action by any government or governmental, administrative or regulatory authority or agency is required for the acquisition or ownership of our stock options and a procedure for obtaining such approval or other action is practically available, as contemplated in this Exchange Program, we presently contemplate that we will undertake commercially reasonable steps to obtain such approval or take such other action. We are unable to predict whether we may in the future determine that we are required to delay the acceptance of Eligible Option Grants or not accept Eligible Option Grants for exchange pending the outcome of any such matter. We cannot assure you that any such approval or other action, if needed, can be obtained or can be obtained without substantial conditions or that the failure to obtain any such approval or other action might not result in adverse consequences to our business. Our obligation under this Exchange Program to accept Eligible Option Grants tendered for exchange and to grant Restricted Stock for Eligible Option Grants tendered for exchange is subject to conditions, including the conditions described in Part III, Section 7 of this Offer to Exchange.

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SECTION 13. Material U.S. Federal Income Tax Consequences.

The following section provides a general summary of material federal income tax consequences associated with the Exchange Program and the Restricted Stock, and does not constitute tax advice. The information provided in this section is based on the Internal Revenue Code, Treasury Regulations and administrative and judicial authorities as of the date of this Exchange Program, all of which may change, possibly on a retroactive basis. This section does not discuss other federal tax consequences (such as employment or estate and gift taxes) or state, local or non-U.S. tax consequences. This section may not discuss all of the tax consequences that are relevant to you in light of your particular circumstances. You should consult with your personal tax advisor for further information with respect to the federal, foreign, state, local, and any other tax consequences of your participation in the Exchange Program.

Federal Income Tax Consequences of the Exchange of Eligible Option Grants . Your receipt of Restricted Stock in exchange for Eligible Option Grants pursuant to this Exchange Program will generally not be a taxable event for federal income tax purposes. You will, however, recognize ordinary income (like salary) at the time the shares vest in an amount equal to the fair market value of those shares at each vesting date. We will determine the fair market value of the shares based on the closing price of our common stock as reported on the NASDAQ on the applicable date. The ordinary income resulting from the vesting of shares of Restricted Stock will be reflected in the Form W-2 or Form 1099-MISC reported to the Internal Revenue Service for the year of the vesting of the shares. At the time that you recognize ordinary income, you will have an income and employment tax obligation with respect to that income, much like the obligation that arises when we pay you your remuneration. In accordance with Section 83(a) of the Internal Revenue Code, you do not have to make an election for the foregoing tax treatment, and the holding date for capital gain purposes begins on each share’s vesting date.

Alternatively, you are permitted to make an affirmative election under Section 83(b) of the Internal Revenue Code within 30 days of your acquiring Restricted Stock on the exchange date, which will be included in your income at the fair market value of the shares on the date they are transferred to you on the exchange date, rather than on the date that the shares vest. Under this election, the holding date for capital gain purposes begins on the transfer date of the shares, regardless of the vesting date. You should use caution, however, since an employee making a Section 83(b) election would not be entitled to any deduction or credit for taxes paid in the year of acquisition if he or she subsequently forfeits unvested shares.

Generally, the issuance of stock options or the vesting of stock options is not a taxable event. Stock options may be issued as Incentive Stock Options (“ISOs”) under the Internal Revenue Code or issued as non-qualified stock options (“NQSOs”). Although all of the Eligible Option Grants issued to you may be labeled as ISOs, some or all of the options in a grant may be disqualified, with the disqualified portion being treated as NQSOs.

Stock options that qualify as ISOs may provide an employee with significant tax benefits, by allowing the employee to exercise the stock options, in limited amounts, without being taxed as ordinary income on the intrinsic (or in-the-money) value on the exercise date. Additionally, long-term capital gains treatment is available if the exercised ISO shares are held one year from the date of the exercise or two years from the date the options were granted, whichever is later.

There can be significant disadvantages to ISOs. Among them is that the difference between the fair market value of the stock and the exercise price (the “in-the-money” amount), upon exercise, is includable in income for alternative minimum tax (AMT) purposes. Although current tax law allows the excess you might pay from your

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AMT tax liability over your ordinary tax liability to be “carried over” and possibly used in future years as an offset to your ordinary income tax liability, your exercising an ISO doesn’t generate any cash to you to pay any AMT tax liability. The problem can become worse if the stock price then falls before the shares are sold, leaving you an AMT bill in the year of exercise, even though the stock actually produced no income.

NQSOs (non-qualified stock options), whether issued as NQSOs or issued as ISOs that became NQSOs, will generally require you to recognize ordinary income (like salary) equal to the intrinsic (or in-the-money) value of the option on the exercise date. The ordinary income resulting from the exercise of NQSOs will be reflected in your Form W-2 or Form 1099-MISC for the year, thereby notifying the IRS that your option was exercised. At the time that you recognize ordinary income, you will have income and employment tax obligations with respect to that income, much like the obligation that arises when we pay you your remuneration. If after exercising your NQSO you hold your stock for the requisite holding period, any future sale of your stock may be more favorably taxable as long-term capital gains, with the exercise price becoming your basis for calculating your gain.

As noted above, this discussion is only a summary of material federal income tax considerations and is not a substitute for professional tax advice. Before you decide whether to participate in the Exchange Program, we urge you to consult with your own tax advisor for an explanation of the federal income and other tax considerations that apply in the context of your own situation.

SECTION 14. Extension of Exchange Program; Termination; Amendment.

We expressly reserve the right, in our sole discretion, at any time and from time to time, and regardless of whether or not any event set forth in Part III, Section 7 of this Offer to Exchange has occurred or is deemed by us to have occurred, to extend the period of time during which this Exchange Program is open, and, by doing so, delay the acceptance for exchange of any Eligible Option Grants, by giving written notice of the extension to the option holders eligible to participate in the exchange or making a public announcement of the extension or, if required by applicable securities laws, the filing and dissemination of revised tender offer materials.

We also expressly reserve the right, in our reasonable judgment, before the Expiration Date, to terminate or amend this Exchange Program or to postpone our acceptance and cancellation of any Eligible Option Grants tendered for exchange upon the occurrence of any of the conditions specified in Part III, Section 7 of this Offer to Exchange, subject to applicable securities laws, by giving written notice of the termination, amendment or postponement to the option holders eligible to participate in the Exchange Program or making a public announcement of the termination, amendment or postponement or, if required by applicable securities laws, the filing and dissemination of revised tender offer materials. If this Exchange Program is terminated or withdrawn, any Eligible Option Grants tendered for exchange will remain outstanding and retain their existing terms, including the existing exercise price, vesting schedule and expiration date. Any termination or withdrawal of this Exchange Program will be treated as if no offer to exchange was ever made.

Subject to compliance with applicable law, we further reserve the right, in our sole discretion, and regardless of whether any event set forth in Part III, Section 7 of this Offer to Exchange has occurred or is deemed by us to have occurred, to amend this Exchange Program in any respect, including, without limitation, by decreasing or increasing the consideration offered in this Exchange Program to option holders or by decreasing or increasing the number of options being sought in this Exchange Program.

Amendments to this Exchange Program may be made at any time and from time to time by public announcement of the amendment. In the case of an extension, the amendment must be announced no later than 9:00 a.m. EDT on the next business day after the last previously scheduled or announced Expiration Date. Any public announcement made pursuant to this Exchange Program will be disseminated promptly to Eligible Persons in a manner reasonably designed to inform option holders of the change. Without limiting the manner in which we may choose

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to make a public announcement, except as required by applicable law, we have no obligation to publish, advertise or otherwise communicate any public announcement other than by making a press release. For purposes of this Exchange Program, a “business day” means any day other than Saturday, Sunday or a federal holiday and consists of the time period from 12:01 a.m. through 12:00 midnight, EDT.

If we materially change the terms of this Exchange Program or the information concerning this Exchange Program, or if we waive a material condition of this Exchange Program, we will extend this Exchange Program in accordance with applicable legal requirements. Except for a change in price or a change in percentage of securities sought, the amount of time by which we will extend this Exchange Program following a material change in the terms of this Exchange Program or information concerning this Exchange Program will depend on the facts and circumstances, including the relative materiality of such terms or information. If we materially change the terms of this Exchange Program we will publish notice or otherwise notify you of our action in writing, in accordance with applicable legal requirements. If this Exchange Program is scheduled to expire at any time earlier than the expiration of a period ending on the tenth business day from, and including, the date that notice of such material changes is first published, sent or given, we will extend this Exchange Program so that this Exchange Program is open at least 10 business days following the publication, sending or giving of such notice.

SECTION 15. Fees and Expenses.

We will not pay any fees or commissions to any broker, dealer or other person for soliciting elections to exchange Eligible Option Grants pursuant to this Exchange Program. Certain executive officers and employees may assist in the Offer to Exchange or the Exchange Program, but will not receive compensation for such services.

SECTION 16. Additional Information.

This Offer to Exchange is a part of a Tender Offer Statement on Schedule TO that we have filed with the SEC. This Offer to Exchange does not contain all of the information contained in the Schedule TO and the exhibits to the Schedule TO. We recommend that you review the Schedule TO, including its exhibits, and the following materials that we have filed with the SEC before making a decision on whether to exchange Eligible Option Grants:

(a) Cumberland Pharmaceuticals Inc.’s Schedule 14A Definitive Proxy Statement for the 2012 Annual Meeting of Stockholders, filed with SEC on March 12, 2012.

(b) Cumberland Pharmaceuticals Inc.’s Annual Report on Form 10-K, for the fiscal year ended December 31, 2011, filed with the SEC on March 7, 2012.

(c) Cumberland Pharmaceuticals Inc.’s Registration Statement on Form S-8, filed with the SEC on January 15, 2010.

These filings, our other annual, quarterly and current reports, our proxy statements and our other SEC filings may be examined, and copies may be obtained, at the following SEC public reference room:

100 F Street, N.E.

Room 1580

Washington, D.C. 20549

Our SEC filings are also available to the public on the SEC’s internet site at http://www.sec.gov. Our common stock is quoted on NASDAQ under the symbol “CPIX”.

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We will provide, without charge, to each person to whom a copy of this Offer to Exchange is delivered, upon the written or oral request of any such person, a copy of any or all of the documents to which we have referred you, other than exhibits to such documents (unless such exhibits are specifically incorporated by reference into such documents). Requests should be directed to:

Cumberland Pharmaceuticals Inc.

Attention: Michelle Mays

Cumberland Pharmaceuticals Inc.

2525 West End Avenue, Suite 950,

Nashville, Tennessee 37203

(615) 255-0068

The information contained in this Offer to Exchange about Cumberland should be read together with the information contained in the documents to which we have referred you.

As you read the foregoing documents, you may find some inconsistencies in information from one document to another. If you find inconsistencies between the documents, or between a document and this Offer to Exchange, you should rely on the statements made in the most recently dated document.

SECTION 17. Miscellaneous.

This Offer to Exchange and our SEC reports referred to above include forward-looking statements. You can identify these statements by the fact that they do not relate strictly to historical or current facts. They contain words such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” “may,” “can,” “could,” “might,” “should” and other words or phrases of similar meaning. Any or all of the forward-looking statements included in this Offer to Exchange and our SEC reports or other public statements made by us are not guarantees of future performance and may turn out to be inaccurate. This can occur as a result of incorrect assumptions or as a consequence of known or unknown risks and uncertainties. These factors include, among other things, the risk factors and other cautionary statements included in our most recently filed reports on Form 10-K and Form 10-Q. Forward-looking statements speak only as of the date they are made. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.

The safe harbor provided in the Private Securities Litigation Reform Act of 1995, by its terms, does not apply to statements made in connection with this Exchange Program.

We are not aware of any jurisdiction where the making of this offer is not in compliance with applicable law. If we become aware of any jurisdiction where the making of this offer is not in compliance with any valid applicable law, we will make a good faith effort to comply with that law. If, after a good faith effort, we cannot comply with an applicable law, this offer will not be made to, nor will elections to exchange Eligible Option Grants be accepted from or on behalf of, the option holders residing in a jurisdiction where that law is applicable.

We have not authorized any person to make any recommendation on our behalf as to whether you should elect to exchange or refrain from exchanging your Eligible Option Grants pursuant to this Exchange Program. You should rely only on the information contained in this Offer to Exchange or other information to which we have in this Offer to Exchange referred you. We have not authorized anyone to give you any information or to make any representations in connection with this Exchange Program other than the information and representations contained in this Offer to Exchange or in the related Election Form and Information Sheet. If anyone makes any recommendation or representation to you or gives you any information, you must not rely upon that recommendation, representation or information as having been authorized by us .

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Cumberland Pharmaceuticals Inc.

April 24, 2012

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Exhibit (a)(1)(ii)

The Cumberland Pharmaceuticals Inc. Exchange Program and withdrawal rights expire at

11:59 p.m., EDT, on May 21, 2012

unless the Exchange Program is extended.

INSTRUCTIONS TO ELECTION FORM 

1 . DEFINED TERMS . All terms used in this Election Form and the subsequent Information Sheet but not defined have the meaning given them in the Offer to Exchange, dated April 24, 2012. References in this Election Form to “Company,” “Cumberland,” “we,” “us,” “our,” and “ours” mean Cumberland Pharmaceuticals Inc. and its subsidiaries.

2. EXPIRATION DATE . The Exchange Program and any rights to tender or to withdraw a tender of Eligible Option Grants expire at 11:59 p.m., EDT, on May 21, 2012 , unless the Exchange Program is extended.

3. DELIVERY OF ELECTION FORM . If you intend to tender an Eligible Option Grant or multiple Eligible Option Grants under the Exchange Program, a signed copy of this Election Form, together with a properly completed and signed Information Sheet, must be received by us before 11:59 p.m., EDT, May 21, 2012 (or such later date as may apply if the Exchange Program is extended) by email (by PDF or similar imaged document file) to optionexchange@cumberlandpharma.com . The subject line of the email must state: “Exchange Program.” Election Forms should not be sent via inter-office mail or hand delivered.

Your Election Form and Information Sheet will be effective only upon receipt by us. We will accept delivery of the signed Election Form and Information Sheet only by one of the methods of delivery described above. The method of delivery is at your own option and risk. You are responsible for making sure that the Election Form and Information Sheet are delivered to the person indicated above. You must allow for delivery time based on the method of delivery that you choose to ensure that we receive your Election Form and Information Sheet on time.

You are not required to tender any Eligible Option Grant. For each Eligible Option Grant you choose to tender for exchange, you must tender that entire option grant for the amount of its unexercised portion. On the Information Sheet, please check the box (either “ACCEPT” or “DECLINE”) and initial corresponding to your Eligible Option Grant, indicating the action you wish to take.

You do not need to return your stock option agreement relating to each tendered Eligible Option Grant, as it will be automatically canceled if we accept your Eligible Option Grant for exchange.

4. WITHDRAWAL OF ELECTION . Tenders of Eligible Option Grants made under the Exchange Program may be withdrawn at any time before 11:59 p.m., EDT, on May 21, 2012 , unless we extend the Expiration Date, in which case withdrawals must be received before such later expiration date and time.

To withdraw a tendered Eligible Option Grant, you must request a replacement Election Form and Information Sheet and email (a PDF or similar imaged document file) a properly completed and signed replacement Election Form and Information Sheet in the manner described in Instruction (3) above. Withdrawals may not be rescinded and any Eligible Option Grant withdrawn will not be considered to be properly tendered, unless the withdrawn Eligible Option Grant is properly re-tendered before the expiration date by following the procedures described in Instruction 3 above.

5. SIGNATURES . Please sign and date the Election Form, and provide your social security number or other

tax identification number. Except as described in the following sentence, this Election Form must be signed by the holder of the Eligible Option Grant to be tendered exactly as such holder’s name appears on the Eligible Option Grant option agreement. If the signature is by an attorney-in-fact or another person acting in a fiduciary or representative capacity, the signer’s full title and proper evidence of the authority of such person to act in such capacity must be identified on this Election Form.

6. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES . Any questions or requests for assistance regarding the exchange offer (including requests for additional or hard copies of the exchange offer or this Election Form) should be directed to Michelle Mays, at mmays@cumberlandpharma.com or by telephone at (615) 255-0068 .

7. IRREGULARITIES . We will determine all questions as to the number of shares subject to Eligible Option Grants tendered and the validity, form, eligibility (including time of receipt) and acceptance of any tender of Eligible Option Grants. Subject to any order or decision by a court or arbitrator of competent jurisdiction, our determination of these matters will be final and binding on all parties. We may reject any or all tenders of Eligible Option Grants that we determine are not in appropriate form or that we determine are unlawful to accept. We may waive any defect or irregularity in any tender with respect to any particular Eligible Option Grant before the expiration of the Exchange Program. No Eligible Option Grant will be accepted for exchange until the holder of the Eligible Option Grant exchanging the Eligible Option Grant has cured all defects or irregularities to our satisfaction, or they have been waived by us, prior to the expiration date. Neither we nor any other person is obligated to give notice of any defects or irregularities involved in the exchange of any Eligible Option Grant.

8. CONDITIONAL OR CONTINGENT OFFERS . We will not accept any alternative, conditional or contingent tenders.

9. IMPORTANT TAX INFORMATION . You should refer to Part III, Section 13 of the Offer to Exchange, which contains important tax information. We encourage all holders of Eligible Option Grants to consult with your personal tax advisor if you have questions about your financial or tax situation.

ELECTION FORM

I acknowledge that:

1. I have received the Offer to Exchange dated April 24, 2012, this Election Form, the form of Restricted Stock Agreement and the 2007 Plan and 2007 Directors’ Plan.

2. I tender to Cumberland Pharmaceuticals Inc. for exchange the Eligible Option Grant(s) specified on the attached Information Sheet and understand that, upon acceptance by Cumberland Pharmaceuticals Inc., this Election Form will constitute a binding agreement between Cumberland Pharmaceuticals Inc. and me. On the Information Sheet I have checked the box and included my initials corresponding to each Eligible Option Grant, indicating whether I want to decline or accept the Company’s offer to exchange Restricted Stock for each of my Eligible Option Grants.

3. I understand that if I validly tender an Eligible Option Grant for exchange, and such Eligible Option Grant is accepted and canceled, I will receive Restricted Stock that will be for fewer shares of common stock than were underlying my Eligible Option Grant.

4. I understand that if I elect to tender an Eligible Option Grant, I must tender all outstanding unexercised options, whether vested or unvested, of that particular grant for exchange.

5. I understand that the Restricted Stock will be unvested at the time it is granted, and will have a new vesting period as follows:

6. I understand that the Restricted Stock will be granted under the 2007 Plan or the 2007 Directors’ Plan, as applicable.

7. Cumberland Pharmaceuticals Inc. has advised me to consult with my own advisors as to the consequences of participating or not participating in this Exchange Program, including my personal tax advisor with any questions regarding the tax consequences of participating in this Exchange Program in the context of my own situation.

8. To remain eligible to tender my Eligible Option Grant(s) for exchange and cancellation pursuant to the Exchange Program, I understand that I must remain an Eligible Person and must not have received nor have given a notice of termination prior to the date and time that the Exchange Program expires, which is scheduled to be 11:59 p.m., EDT, on May 21, 2012, unless the Exchange Program is extended.

9. I understand that if I cease providing services to the Company prior to the Expiration Date of the Exchange Program, the Company will not accept my Eligible Option Grant for cancellation and I will retain my Eligible Option Grant with its current terms and conditions.

10. I understand that if I cease providing services to the Company, I will forfeit any unvested shares of Restricted Stock.

11. I understand that neither the ability to participate in the Exchange Program nor actual participation in the Exchange Program will be construed as a right to continued employment with the Company or any of its subsidiaries.

12. I understand that in accordance with Part III, Sections 7 and 14 of the Offer to Exchange; the Company may terminate, modify or amend the Exchange Program and postpone its acceptance and cancellation of any Eligible Option Grants that I have tendered for exchange. In any such event, I understand that the Eligible Option Grants tendered for exchange but not accepted will remain in effect with its current terms and conditions.

13. I understand that this election is entirely voluntary, and I am aware that I may change or withdraw my decision to tender my Eligible Option Grant(s) at any time until the Exchange Program expires by submitting a new Election Form and Information Sheet to the Company expressing my revocation as described in the Instructions to this Election Form. I further understand to re-elect to participate in the Exchange Program, I must again follow the procedure described in these instructions to deliver a new Election Form prior to the expiration of the Exchange Program. I understand that this decision to tender any or all of my Eligible Option Grant(s) will be irrevocable at 11:59 p.m., EDT, on May 21, 2012 , unless the Exchange Program is extended.

14. I sell, assign and transfer to the Company all right, title and interest in and to the Eligible Option Grants that I am tendering as specified in the attached Eligible Option Grant Information Sheet, and I agree that I shall have no further right or entitlement to purchase any shares of the Company’s common stock under the tendered Eligible Option Grant(s) on the date Cumberland accepts such Eligible Option Grant(s) for exchange and cancellation.

15. I agree to all of the terms and conditions of the Exchange Program AND HAVE ATTACHED A SIGNED COPY OF THE INFORMATION SHEET . I understand that if I do not include the Information Sheet with this Election Form, I will be deemed to have elected NOT to exchange my Eligible Option Grant(s).

NOTE TO ELIGIBLE PERSONS IN COMMUNITY PROPERTY STATES:

If you are married and reside in a state the laws of which provide that a spouse has a community property interest in the Eligible Options, in order to elect to tender your Eligible Option Grant(s) your spouse must execute the Spousal Consent below. Under the Consent, your spouse agrees to be bound, and agrees that any such community property interest shall similarly be bound, by this Election Form. States with community property laws are Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin.

Your failure to provide your spouse’s signature constitutes your representation and warranty to Cumberland that either you are not married or your spouse has no community or other marital property rights in the Eligible Option Grant(s) or your new Restricted Stock. You should consult your personal outside advisors if you have questions about the Spousal Consent below.

Spousal Consent

The undersigned spouse of the Eligible Person who has executed this Election Form above has read and hereby approves the submission of this Election Form and Information Sheet. The undersigned agrees to be irrevocably bound by this Election Form and further agrees that any community property interest of the undersigned will similarly be bound by this Election Form. The undersigned appoints the Eligible Person who has executed this Election Form above as his/her attorney-in-fact with respect to any amendment or exercise of any rights under this Election Form.

Exhibit (a)(1)(iii)

ELIGIBLE OPTION GRANT AND RESTRICTED STOCK INFORMATION SHEET

Name

Address

City, State, Zip Code

Steps to properly complete this Eligible Option Grant Information Sheet

Step 1 : By checkmark, indicate which Eligible Option you want to exchange.

Step 2 : Initial the appropriate election where indicated.

Step 3 : Return along with your Election Form to optionexchange@cumberlandpharma.com no later than 11:59 p.m. EDT on May 21, 2012.

If you elect to participate in the Exchange Program, this sheet must be properly completed, initialed and submitted with your Election Form no later than 11:59 p.m. EDT on May 21, 2012. If this Information Sheet is not properly completed, initialed and submitted with your Election Form, your Election Form will be rejected.

2525 West End Avenue, Suite 950

Nashville, Tennessee 37203

Phone: (615) 255-0068

Email: mmays@cumberlandpharma.com

EXHIBIT (a)(1)(iv)

April 24, 2012

To Employees, Directors and Advisors of Cumberland Pharmaceuticals Inc. Eligible to Participate in the Exchange Program:

I am pleased to announce the commencement of a new Cumberland Stock Option Exchange Program (the “Exchange Program”), which provides you the opportunity to exchange certain “out-of-the-money” or “underwater” stock options for shares of restricted common stock in the Company (the “Restricted Stock”). We provide equity awards such as stock options to motivate and reward our employees, directors and advisors by enabling you to benefit from increases in the price of Cumberland stock. But when stock options are “out-of-the-money,” we recognize that their motivational and retention value may be diminished.

The Exchange Program provides you with the opportunity to exchange certain stock options for Restricted Stock. The number of shares of Restricted Stock that you will receive was determined by the Compensation Committee of our Board of Directors with the goal of providing no immediate tax impact to you or the Company. The Exchange Program applies to outstanding stock options with an exercise price of $9.00 per share or greater. The enclosed information describes the terms of the Exchange Program and the number of shares of Restricted Stock you are eligible to receive in exchange for your Eligible Option grants.

The Exchange Program opens today and will close at 11:59 p.m. EDT on May 21, 2012. You have been identified as an individual who is currently eligible to participate in the Exchange Program and eligibility is based on a number of factors, including a continued active role in the Company as outlined in the Exchange Program materials.

Enclosed with this package are: (1) an Offer to Exchange, which contains detailed information about the Exchange Program, (2) an Election Form, and (3) an Eligible Option Grant and Restricted Stock Information Sheet, which contains information about your specific stock options that are eligible for exchange in the Exchange Program and the number of shares of Restricted Stock you may choose to receive in exchange for those stock options.

The decision to participate in the Exchange Program is a personal one based on your assumptions about a number of factors, including the performance of publicly traded stocks generally, our own stock price and our business. We cannot advise you on your decision as to whether or not to participate, and there are no guarantees of our future stock performance. Moreover, we are not encouraging or discouraging your participation. You should read all of the Exchange Program materials carefully and consult with your personal financial and tax advisors before deciding whether or not to participate.

I am delighted that the Company’s Board of Directors has offered you this choice and I urge you to read all of the enclosed materials carefully to come to a decision that is best for you.

These written materials and other documents may be obtained from the Securities and Exchange Commission’s website at www.sec.gov or a copy of such documents may be obtained from the Company free of charge by writing to us at 2525 West End Avenue, Suite 950, Nashville, Tennessee 37203; Attention: Michelle Mays.

Sincerely,

This message confirms that we have received your Election Form and Eligible Option Grant Information Sheet. This confirmation should not, however, be construed to imply that the Election Form, Eligible Option Grant Information Sheet or any other documents that you have submitted have been properly completed or are otherwise in proper form or that we have accepted your Eligible Option Grant(s) for exchange. If your Election Form and Eligible Option Grant Information Sheet are properly completed and signed, and all eligibility requirements are met, we expect to accept your Eligible Option Grant(s) elected for exchange, subject to the terms and conditions set forth in the Offer to Exchange, promptly following the expiration of the exchange offer at 11:59 p.m., EDT, on May 21, 2012, unless this Exchange Program is extended by us. Any Eligible Option Grants listed on your Eligible Option Grant Information Sheet for which you checked the corresponding box, will be canceled upon expiration of the Exchange Program.

Unless you withdraw your tendered Eligible Option Grant(s) before 11:59 p.m., EDT, on May 21, 2012 (or, if the Exchange Program is extended), we will, subject to the conditions of the Exchange Program, cancel the Eligible Option Grant(s) that you have properly tendered for exchange. If you do not withdraw your tendered Eligible Option Grant(s) and we accept your Eligible Option Grant(s) for exchange, promptly following the expiration of this Exchange Program we will provide you with a “confirmation letter” confirming that your Eligible Option Grant(s) has been accepted for exchange and has been canceled. Your Election Form and Eligible Option Grant Information Sheet may be changed or revoked at any time by delivering a new properly completed and signed Election Form and Eligible Option Grant Information Sheet bearing a later date so long as we receive the documents before the Expiration Date of the Exchange Program.

You should direct questions about the Exchange Program or requests for assistance (including requests for additional or paper copies of the Offer to Exchange, the Election Form, your Eligible Option Grant Information Sheet or other documents relating to this Exchange Program) to Michelle Mays, at 2525 West End Avenue, Suite 950, Nashville, Tennessee 37203 or by calling 615-255-0068 or sending an email to mmays@cumberlandpharma.com .

EXHIBIT (a)(1)(vi)

To Cumberland Pharmaceuticals Inc. Employees, Directors and Advisors Eligible for the Exchange Program:

The Cumberland Exchange Program with respect to certain outstanding stock options under Cumberland’s 1999 Plan, 2007 Plan and 2007 Directors’ Plan will close in 11 business days, at 11:59 p.m. EDT on Friday, May 21, 2012 . In order to participate in the Exchange Program, your Election Form and Information Sheet must be received by that deadline.

Participation in the Exchange Program is voluntary. You may have decided not to participate, or you may not yet have had the opportunity to make your election. In either case, please be sure to read the materials you have received carefully and consult with your personal financial advisor. Should you wish to change your decision or want to submit your Election Form to participate, please follow the instructions in your materials, and submit your Election Form and Information Sheet to Cumberland Pharmaceuticals Inc. by scanning the form and e-mailing it to: optionexchange@cumberlandpharma.com . In the subject line of the email please state: “Exchange Program.”

DO NOT send Election Forms via inter-office mail or hand deliver. Election Forms must be received by email at optionexchange@cumberlandpharma.com with “Exchange Program” in the subject field before 11:59 p.m. EDT on Friday, May 21, 2012 .

The Exchange Program materials contain important information for employees and advisors, including an offering memorandum that should be read carefully prior to making a decision whether to participate in the Exchange Program. These written materials and other documents may be obtained free of charge from the Securities and Exchange Commission’s website at www.sec.gov.

Eligible Persons may obtain, free of charge, a written copy of the offering memorandum and other materials by calling Michelle Mays at (615) 255-0068 or sending an e-mail to mmays@cumberlandpharma.com.

EXHIBIT (a)(1)(vii)

Form of Cumberland Exchange Program

Election Confirmation Form

Employee, Director or Consultant Name:

You recently elected to participate in the Cumberland Exchange Program. The table below shows your Eligible Option
Grant(s) that was submitted for exchange and the Restricted Stock that was granted in exchange. Restricted Stock grant documents will be delivered to you shortly.

If you have any questions, please contact Michelle Mays at (615) 255-0068 or mmays@cumberlandpharma.com.

EXHIBIT (d)(6)

FORM OF RESTRICTED STOCK AGREEMENT

NOTICE OF EQUITY GRANT

Name

Address

City, State, Zip Code

Dear Name,

Pursuant to the Option Exchange Program, you elected to tender certain stock options for shares of restricted stock. I am pleased to inform you with this Notice that the following shares of restricted stock have been exchanged for your outstanding stock options tendered to the Company. Terms of the restricted stock are outlined below.

By your signature and my signature as the Company’s representative below, you and the Company agree that this equity is granted under and governed by the terms and conditions of the Cumberland Pharmaceuticals Inc. Amended and Restated 2007 Long-Term Incentive Plan, as amended on April 17, 2012 (the ‘Plan’) and Restricted Stock Award Agreement (‘Agreement’), which is attached. A copy of the Plan is available from our Human Resources department.

Note: Please return this Notice in the enclosed return envelope within 10 business days . If there are any discrepancies in your name or address shown above, please make the appropriate corrections on this form.

CUMBERLAND PHARMACEUTICALS INC.

RESTRICTED STOCK AGREEMENT

This Restricted Stock Agreement (the “Agreement”) is between Cumberland Pharmaceuticals Inc. (the “Company”) and the Participant named on the Notice of Equity Grant to which this Agreement is attached (the “Notice”). The Notice is hereby incorporated in full into this Agreement. The grant of Restricted Stock (“Stock”) made in this Agreement is subject to the terms of the Cumberland Pharmaceuticals Inc. Amended and Restated 2007 Long-Term Incentive Compensation Plan, as amended on April 17, 2012 (the “Plan”). Unless otherwise defined in this Agreement, capitalized terms used in this Agreement shall have the same meaning as those capitalized terms in the Plan.

1. Award of Stock . The Company hereby awards Participant the number of shares of Stock in the Company specified in the Notice (the “Shares”). The Grant Date for the Shares shall be as specified in the Notice. Participant agrees to comply with all of the terms and conditions of the Plan and any future amendments and restatements thereof.

2. Vesting . Until vested, a Share shall be within the Restriction Period. The Shares shall vest (meaning the Restriction Period will end) on the four-year anniversary of the Grant Date, if the Participant remains employed by the Company in a full-time position until such date. However, in the event of a Change in Control Event (as defined in the Plan and to the extent consistent with the definition of Change in Control Event found in Treas. Reg. 1.409A-3(i)(5)(i) & (ii)) prior to the fourth anniversary of the Grant Date, the Shares will vest on the date of such Change in Control Event. In the event of Participant’s Employment Termination prior to vesting of the Shares, ownership of any unvested Shares shall automatically immediately revert to the Company and Participant shall not be entitled to any payment or consideration for such unvested Shares. During the Restriction Period, the Participant shall not have the right to vote the Shares.

3. Registration of Securities . The Shares have been registered under the Securities Act. Participant understands that a registration statement for such securities (filed under Form S-8) is effective and is available at the Company’s website at www.cumberlandpharma.com in the “Investor Relations” section under “SEC Filings” (filed January 15, 2010) and that numerous other documents that the Company has filed with the Securities and Exchange Commission are also available for review at such website and at www.sec.gov

4. Tax Treatment . The Stock award will be taxable as compensation to the Participant on the date of grant or the date of vesting, depending on whether or not Participant files an election under Internal Revenue Code Section 83(b) with the IRS within 30 days after the Grant Date shown on the Notice. Participant may obtain general information about a Section 83(b) election at http://personal.fidelity.com/products/stockoptions/rstockfaq.shtml#faq16 Participant is hereby advised to contact his tax advisor immediately if he is interested in filing a Section 83 (b) election. The Company does not guarantee any particular tax treatment or results in connection with the Shares.

5. Notices . Any notice given under this Agreement shall be in writing and shall be addressed and delivered, in the case of the Company, to the Secretary of the Company at the Company’s principal office and, in the case of the Participant, at the last address for Participant shown in his or her personnel file maintained by the Company.

6. For Executive Officers Only – Clawback Policy . In accordance with the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”), the Board intends to adopt and include in the Plan a clawback policy once the SEC has published its final rules for implementation of such a policy. Participant understands that such clawback policy will apply to certain incentive compensation he receives as an executive officer of the Company if the Company is later required to prepare an accounting restatement due to its material non-compliance with a financial reporting requirement under the securities laws. Further information about the clawback provisions of the Dodd-Frank Act is available online from many sources, including http://www.boardmember.com/Print.aspx?id=5146 .

7. Miscellaneous . The grant of this Stock award does not create any contractual or other right to receive future grants of equity awards, or benefits in lieu of, even if the Participant has a history of receiving stock awards.

By their signatures on the Notice, Participant and the Company agree to the terms of this Agreement.

EXHIBIT (d)(7)

FORM OF RESTRICTED STOCK AGREEMENT

NOTICE OF EQUITY GRANT

Name

Address

City, State, Zip Code

Dear Name,

Pursuant to the Option Exchange Program, you elected to tender certain outstanding stock options for shares of restricted stock. I am pleased to inform you with this Notice that the following shares of restricted stock have been exchanged for your outstanding stock options tendered to the Company. Terms of the award of restricted stock are outlined below.

By your signature and my signature as the Company’s representative below, you and the Company agree that this equity is granted under and governed by the terms and conditions of the Cumberland Pharmaceuticals Inc. Amended and Restated 2007 Directors Incentive Plan, as amended on April 17, 2012, (the ‘Plan’) and a Restricted Stock Award Agreement (‘Agreement’), which is attached. A copy of the Plan is available from our Human Resources department.

Note: Please return this Notice in the enclosed return envelope within 10 business days . If there are any discrepancies in your name or address shown above, please make the appropriate corrections on this form.

CUMBERLAND PHARMACEUTICALS INC.

RESTRICTED STOCK AWARD AGREEMENT

This Restricted Stock Award Agreement (the “Agreement”) is between Cumberland Pharmaceuticals Inc. (the “Company”) and the Participant named on the Notice of Equity Grant to which this Agreement is attached (the “Notice”). The Notice is hereby incorporated in full into this Agreement. The grant of Restricted Stock (“Stock”) made in this Agreement is subject to the terms of the Cumberland Pharmaceuticals Inc. Amended and Restated 2007 Directors’ Incentive Plan, as amended on April 17, 2012 (the “Plan”). Unless otherwise defined in this Agreement, capitalized terms used in this Agreement shall have the same meaning as those capitalized terms in the Plan.

1. Award of Stock . The Company hereby awards Participant the number of shares of Stock in the Company specified in the Notice (the “Shares”). The Grant Date for the Shares shall be as specified in the Notice. Participant agrees to comply with all of the terms and conditions of the Plan and any future amendments and restatements thereof.

2. Vesting . Until vested, a Share shall be within the Restriction Period. The Shares shall vest (meaning the Restriction Period will end) on the one-year anniversary of the Grant Date, if the Participant remains a Director until such date. However, in the event of a Change in Control Event (as defined in the Plan and to the extent consistent with the definition of Change in Control Event found in Treas. Reg. 1.409A-3(i)(5)(i) & (ii)) prior to the first anniversary of the Grant Date, the Shares will vest on the date of such Change in Control Event. In the event of Participant’s Employment Termination prior to vesting of the Shares, ownership of any unvested Shares shall immediately revert to the Company and Participant shall not be entitled to any payment or consideration for such unvested Shares. During the Restriction Period, the Participant shall have the right to vote the Shares.

3. Registration of Securities . The Shares have been registered under the Securities Act. Participant understands that a registration statement for such securities (filed under Form S-8) is effective and is available at the Company’s website at www.cumberlandpharma.com in the “Investor Relations” section under “SEC Filings” (filed January 15, 2010) and that numerous other documents that the Company has filed with the Securities and Exchange Commission are also available for review at such website.

4. Tax Treatment . The Stock award will be taxable as compensation to the Participant on the date of grant or the date of vesting, depending on whether or not Participant files an election under Internal Revenue Code Section 83(b) with the IRS within 30 days after the Grant Date shown on the Notice. Participant may obtain general information about a Section 83(b) election at many websites, including http://personal.fidelity.com/products/stockoptions/rstockfaq.shtml#faq16. Participant is hereby advised to contact his tax advisor immediately if he is interested in filing a Section 83 (b) election. The Company does not guarantee any particular tax treatment or results in connection with the Shares.

5. Notices . Any notice given under this Agreement shall be in writing and shall be addressed and delivered, in the case of the Company, to the Secretary of the Company at the Company’s principal office and, in the case of the Participant, at the last address for Participant shown in his or her personnel file maintained by the Company.

6. For Executive Officers Only – Clawback Policy . In accordance with the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”), the Board intends to adopt and include in the Plan a clawback policy once the SEC has published its final rules for implementation of such a policy. Participant understands that any such required clawback policy will apply to certain incentive compensation he receives as an executive officer of the Company if the Company is later required to prepare an accounting restatement due to its material non-compliance with a financial reporting requirement under the securities laws. Further information about the clawback provisions of the Dodd-Frank Act is available online from many sources, including http://www.boardmember.com/Print.aspx?id=5146 .

7. Miscellaneous . The grant of this Stock award does not create any contractual or other right to receive future grants of equity awards, or benefits in lieu of, even if the Participant has a history of receiving stock awards.

By their signatures on the Notice, Participant and the Company agree to the terms of this Agreement.