Physicians Formula Awarded 2008 Front End Supplier of the Year by Rite Aid

Business Wire, August 25, 2008

AZUSA, Calif. -- Physicians Formula Holdings, Inc. (NASDAQ:FACE) ("Physicians Formula" or the "Company") today announced that Physicians Formula is one of only five manufacturers, and the only beauty brand, to be awarded 2008 Front End Supplier of the Year by Rite Aid Corporation at their annual conference on August 19. The others were Church & Dwight, LNK International, Pharmavite and Procter & Gamble (Oral Care and Household Chemical divisions).

Front-end merchandise, or non-prescription products, contributes significantly to the overall sales of the chain drug store industry by delivering the convenience that consumers demand. Typically, each year, Rite Aid assesses its retail partners' brands focusing on those that support the highest-impact categories, maximize the effectiveness of promotions, enhance consumers' market basket and grow and retain existing customers. The Supplier of the Year designation represents all categories.

This year, Physicians Formula was recognized by Rite Aid for its support of new promotional opportunities and high sense of urgency and speed of response that extends beyond the category management group and into merchandising and the supply chain.

"We are very pleased that Physicians Formula has been recognized by Rite Aid as a Supplier of the Year," said Ingrid Jackel, Chief Executive Officer of Physicians Formula. "This award is a testament to our team's dedication to providing our retail partners with not only the most innovative products, but by also working with them to educate and provide value to consumers to increase their sales. We look forward to our continued partnership with Rite Aid as well as our other retail partners."

About Physicians Formula Holdings, Inc.

Physicians Formula is one of the fastest growing cosmetics companies operating in the mass market prestige, or "masstige", market. Under its Physicians Formula brand name, created in 1937, the Company develops, markets and distributes innovative, premium-priced products for the mass market channel. Physicians Formula differentiates itself by addressing skin imperfections through a problem-solving approach, rather than focusing on changing fashion trends. Currently, Physicians Formula products are sold in approximately 27,000 stores throughout the U.S. including stores operated by Wal-Mart, Rite Aid, Target, CVS, Walgreens and Kroger.

Safe Harbor Statement

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In some cases, forward-looking statements can be identified by words such as "anticipates," "estimates," "expects," "believes," "plans," "predicts," and similar terms. These forward-looking statements are based on current expectations, estimates and projections about the Company's business and its industry, based on management's beliefs and assumptions. Forward-looking statements are not guarantees of future performance and the Company's actual results may differ significantly from the results discussed in the forward-looking statements. Factors that might cause such differences include, but are not limited to: the demand for the Company's products; the Company's ability to expand its product offerings; the competitive environment in the Company's business; the Company's operations and ability to achieve cost savings; the effect of technological and regulatory changes; the Company's cash needs and financial performance; changes in general economic or market conditions; and other factors discussed in the Company's filings with the Securities and Exchange Commission (the "SEC"), including the Risk Factors contained in the Company's filings with the SEC, and available at www.physiciansformula.com and the SEC's website at www.sec.gov. You are urged to consider these factors carefully in evaluating the forward-looking statements in this release and are cautioned not to place undue reliance on such forward-looking statements, which are qualified in their entirety by this cautionary statement. Unless otherwise required by law, the Company expressly disclaims any obligation to update publicly any forward-looking statements, whether as result of new information, future events or otherwise.

(FACE/F)