SEC Form 4

FORM 4		UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934 or Section 30(h) of the Investment Company Act of 1940	OMB APPROVAL OMB Number: 3235-0287 Estimated average burden hours per response: 0.5
	Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).

1. Name and Address of Reporting Person* LIFE SCIENCES OPPORTUNITIES FUND II LP (Last) (First) (Middle) CARNEGIE HALL TOWER 152 WEST 57TH STREET, 19TH FLOOR (Street) NEW YORK NY 10019 (City) (State) (Zip)	2. Issuer Name and Ticker or Trading Symbol IGI LABORATORIES, INC [ IG ]	5. Relationship of Reporting Person(s) to Issuer (Check all applicable) Director X 10% Owner Officer (give title below) Other (specify below)
	3. Date of Earliest Transaction (Month/Day/Year) 08/20/2010
	4. If Amendment, Date of Original Filed (Month/Day/Year)	6. Individual or Joint/Group Filing (Check Applicable Line) Form filed by One Reporting Person X Form filed by More than One Reporting Person

Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned
1. Title of Security (Instr. 3)	2. Transaction Date (Month/Day/Year)	2A. Deemed Execution Date, if any (Month/Day/Year)	3. Transaction Code (Instr. 8)		4. Securities Acquired (A) or Disposed Of (D) (Instr. 3, 4 and 5)			5. Amount of Securities Beneficially Owned Following Reported Transaction(s) (Instr. 3 and 4)	6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	7. Nature of Indirect Beneficial Ownership (Instr. 4)
			Code	V	Amount	(A) or (D)	Price
Common Stock	08/20/2010		C		2,382,167	A	(1)	2,382,167	D(2)
Common Stock	08/20/2010		C		13,310,657	A	(1)	13,310,657	D(3)

Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned (e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security (Instr. 3)	2. Conversion or Exercise Price of Derivative Security	3. Transaction Date (Month/Day/Year)	3A. Deemed Execution Date, if any (Month/Day/Year)	4. Transaction Code (Instr. 8)		5. Number of Derivative Securities Acquired (A) or Disposed of (D) (Instr. 3, 4 and 5)		6. Date Exercisable and Expiration Date (Month/Day/Year)		7. Title and Amount of Securities Underlying Derivative Security (Instr. 3 and 4)		8. Price of Derivative Security (Instr. 5)	9. Number of derivative Securities Beneficially Owned Following Reported Transaction(s) (Instr. 4)	10. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	11. Nature of Indirect Beneficial Ownership (Instr. 4)
				Code	V	(A)	(D)	Date Exercisable	Expiration Date	Title	Amount or Number of Shares
Series B-1 Convertible Preferred Stock	(1)	08/20/2010		C			152.844	(1)	(1)	Common Stock	2,382,167	(1)	0	D(2)
Series B-1 Convertible Preferred Stock	(1)	08/20/2010		C			854.035	(1)	(1)	Common Stock	13,310,657	(1)	0	D(3)

1. Name and Address of Reporting Person* LIFE SCIENCES OPPORTUNITIES FUND II LP (Last) (First) (Middle) CARNEGIE HALL TOWER 152 WEST 57TH STREET, 19TH FLOOR (Street) NEW YORK NY 10019 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* LIFE SCIENCES OPPORTUNITIES FUND INSTITTUTIONAL II LP (Last) (First) (Middle) CARNEGIE HALL TOWER 152 WEST 57TH STREET, 19TH FLOOR (Street) NEW YORK NY 10019 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* LOF PARTNERS LLC (Last) (First) (Middle) CARNEGIE HALL TOWER 152 WEST 57TH STREET, 19TH FLOOR (Street) NEW YORK NY 10019 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* SANDERS MORRIS HARRIS GROUP INC (Last) (First) (Middle) 600 TRAVIS, SUITE 5800 (Street) HOUSTON TX 77002 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* SMH CAPITAL INC. (Last) (First) (Middle) 600 TRAVIS, SUITE 5800 (Street) HOUSTON TX 77002 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* GALE JAMES C (Last) (First) (Middle) CARNEGIE HALL TOWER 152 WEST 57TH STREET, 19TH FLOOR (Street) NEW YORK NY 10019 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer X Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* Erony Joyce (Last) (First) (Middle) CARNEGIE HALL TOWER 152 WEST 57TH STREET, 19TH FLOOR (Street) NEW YORK NY 10019 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer X Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* BALL GEORGE L (Last) (First) (Middle) 600 TRAVIS, SUITE 5800 (Street) HOUSTON TX 77002 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

Explanation of Responses:

1. Pursuant to the terms of the Certificate of Designation, shares of Series B-1 Convertible Preferred Stock (the "Series B-1 Preferred Stock") automatically convert into shares of common stock upon the date that the Closing Price (as defined in the Certificate of Designation) of the common stock shall have exceeded $1.20 for a period of twenty-five (25) consecutive trading days immediately preceding such date. Specifically, shares of Series B-1 Preferred Stock convert into 14,634 shares of common stock, plus such number of shares of common stock as shall equal (x) the accrued and unpaid dividends on the Series B-1 Preferred Stock divided by (y) $0.41. On August 19, 2010, the Closing Price of the common stock was $1.29, which was the twenty-fifth day for which the Closing Price of the common stock exceeded $1.20. As of August 19, 2010, the accrued and unpaid dividends on all outstanding shares of Series B-1 Preferred Stock amounted to $392,844.49.

2. These securities are owned directly by Life Sciences Opportunities Fund II, L.P. and indirectly by Signet Healthcare Partners, LLC ("General Partner"), the general partner of Life Sciences Opportunities Fund (Institutional) II, L.P., James C. Gale, the chief investment officer, a manager and member of the General Partner, Sanders Morris Harris, Inc. ("SMH"), the controlling member of the General Partner, Sanders Morris Harris Group, Inc. ("SMHG"), the parent company of SMH, Joyce Erony, a director of IGI Laboratories, Inc. and a managing director of the General Partner and George L. Ball, a manager of the General Partner and Chief Executive Officer and a director of SMH and SMHG. The General Partner, Mr. Gale, SMH, SMHG, Ms. Erony and Mr. Ball disclaim beneficial ownership of the reported securities except to the extent of their pecuniary interest therein, if any.

3. These securities are owned directly by Life Sciences Opportunities Fund (Institutional) II, L.P. and indirectly by the General Partner, Mr. Gale, SMH, SMHG, Ms. Erony and Mr. Ball. The General Partner, Mr. Gale, SMH, SMHG, Ms. Erony and Mr. Ball disclaim beneficial ownership of the reported securities except to the extent of their pecuniary interest therein, if any.

Remarks:

This is a joint filing by Life Sciences Opportunities Fund (Institutional) II, L.P., Life Sciences Opportunities Fund II, L.P., the General Partner, Mr. Gale, SMH, SMHG, Ms. Erony and Mr. Ball. Life Sciences Opportunities Fund II, L.P. is the designated filer for Life Sciences Opportunities Fund (Institutional) II, L.P., General Partner, Mr. Gale, SMH, SMHG, Ms. Erony and Mr. Ball. The address of each filer is the same as the designated filer except SMH, SMHG and Mr. Ball, which is 600 Travis, Suite 5800, Houston, Texas 77002. Ms. Erony and Mr. Gale currently serve on the IGI Laboratories, Inc. board of directors.

	Life Sciences Opportunities Fund II, L.P., By: Signet Healthcare Partners, LLC, By: /s/ James C. Gale, Manager	08/24/2010
	Life Sciences Opportunities Fund (Institutional) II, L.P., By: Signet Healthcare Partners, LLC, By: /s/ James C. Gale, Manager	08/24/2010
	Signet Healthcare Partners, LLC, By: SMH Capital Inc., By: /s/ George L. Ball, Chief Executive Officer	08/24/2010
	Sanders Morris Harris Group, Inc. By: /s/ George L. Ball, Chief Executive Officer	08/24/2010
	Sanders Morris Harris Inc., By: /s/ George L. Ball, Chief Executive Officer	08/24/2010
	/s/ James C. Gale	08/24/2010
	/s/ Joyce Erony	08/24/2010
	/s/ George L. Ball	08/24/2010
	** Signature of Reporting Person	Date
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