Lories can be like this but I would strongly recommend that you try behavioural rather than drug therapy. As you have found, certain drugs can help short-term but they aren't going to change anything and you have to cope with the 'bounce back' factor when the drug is wearing off.
If he was mine I would be starting from scratch with him. If he is attacking your hand then don't offer your hand but go for a known perch instead. Most lories are way more territorial within their own environment (ie cage) so use something like a perch to get him out. If he will come out on his own and hop onto a protected arm, so much the better. Give him an area to burn off excess energy - a play stand is good but anything away from his cage will do, I use the top of my tame finch's cage covered with a towel and find I can even use the finches to do a 'Shhh! You'll wake the baby!' trick.

. Lories are horribly intelligent so treat them as you would a two year old child. He needs to learn to 'step-up' onto a perch or your arm (minus fingers!) and spend a few moments there before being returned to his play-stand or cage. I find long sleeves a Godsend at times like these as you can pull them down over vulnerable skin without introducing the HORROR of gloves!
Be led by him. If his eyes are pinning and he is doing all the excited lory stuff then leave him to it and come back in 5 minutes. Never underestimate the power of food rewards with lories either. They are slaves to their tummies.

The good thing is they get bored easily and you can present yourself as the solution. He will adore spending time with you once he realises how much fun it is (even without the screaming and blood!). The best method of disciplining a lory is time-out. Walk away if he is safe or (and here lies the advantage of teaching him step up onto a perch!) pop him back in his cage and leave him to it. Make sure he knows that you aren't happy with key words; NO bite! Be Good! Uh Oh! whatever floats your boat. Just be consistent and quick in your disapproval of bad behaviour. BUT remember to be equally quick and generous with your rewards for good behaviour. Attention is the biggest prize closely followed by treat foods. My little troublesome guy loves yogurt covered raisins, little bits of plain biscuit (cookie) and (if I really love him!) a dip in the hand-feeding formula of the latest babies.
It does sound very much like your lory thinks he is in charge so it is up to you to disabuse him of this view. Your cat will thank you!

Good luck!
All the best,
Heather
