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Cadila Healthcare Ltd

Investor PresentationMarch 2007

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Zydus Cadila- One of India’s leading integrated pharma companies

Ranked 5th in the domestic formulations market. (as per ORG IMS MAT Dec-06).

Formulations exports grew by ~69% in last three years and by 109% during 9 months of FY 06-07, on the back of rapid growth in developed / semi regulated generics markets of US, France and Brazil.

Focusing on Research & Development – spending 6-7% of the revenues on R&D every year.

Apr-Dec 06 % Gr FY 05-06 % Gr

Consol. Revenues $315 mn 24% $331 mn 19% Consol. PAT $ 43 mn 60% $ 34 mn 46%

Market Capitalisation of ~ $ 925 mn.

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Core Business Areas and their Revenue Break-up

Revenue break-up by segment

Revenue break-up by region

Break-up of Revenue (Jan-Dec 06)

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State of the art facilities and infrastructure

Formulations – four manufacturing plants Moraiya (Gujarat)

Largest integrated facility in Asia; facilities for producing almost all types of dosage forms

Approved by US FDA, MHRA, ANVISA, AFSSAPS, BFAD & MCC

Baddi (Himachal Pradesh) – for catering to domestic market

Goa – for catering to both domestic and non regulated markets

One more facility at Sikkim for domestic market on the verge of completion

Amongst few in India to make lyophilised products, vaccines, aerosols, hormones and cytotoxic products,

Only producer of transderamal patches and suppositories in India

APIs and Fine Chemicals – four plants Ankleshwar & Dabhasa (Gujarat) – US FDA approved multi purpose plants

Patalganga (Maharashtra) – multi purpose with GMP certification

Fully dedicated fine chemicals facility at Ahmedabad (Gujarat)

Contract Manufacturing Mumbai (Zydus Altana JV) – dedicated facility for pantoprazole intermediates

Goa – dedicated facility for manufacturing Agiolax for Madaus AG

Two more facilities under construction near Ahmedabad (Gujarat) –

Cytotoxic production facility for Zydus Mayne JV

Cytotoxic facility for NDDS product for Zydus BSV JV

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Overall strategy

Continued focus on domestic market

Grow rapidly in key global generics

markets- US, Europe & Latin America

Leverage strengths through contract

manufacturing opportunities

Focus on innovation- R&D

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Domestic market strategy

Maintain overall position and market share through:

Focus on faster growing chronic/ lifestyle segments

Continued new product introductions In-licensing arrangements- Schering AG, Boehringer

Ingelheim, Meda Pharma etc.

Marketing excellence

2000-01 2006Portfolio shift to life style and chronic segments

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Achievements in domestic market

• Zydus Cadila ranks 5th with Rs ~9.5bn sales. (Source : ORG IMS MAT Dec-06)

• 17 Zydus brands feature amongst the top 300 brands. (as per ORG IMS MAT Dec-06)

• Launched 34 new products in FY 05-06. New products introduced in last 3 years contribute ~10% of domestic formulations sales.

• Plan to launch 30-35 products in FY 06-07, and the same run-rate to continue for next 2-3 years.

• Recently launched ‘Novolizer’, a third-generation refillable, breath actuated multiple dose dry powder inhaler device for Asthma and COPD, which is 1st of its kind. The technology for the device has been provided by Meda Pharma of Sweden.

CardiovascularCardiovascular

GastrointestinalGastrointestinal

Female HealthcareFemale Healthcare

RespiratoryRespiratory

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Zydus Rank *

* Segment ranking and Market Share refer to participated market. Source:ORG-IMS Dec 06 (MAT)

Therapeutic Area

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Prioritized Generics Markets

Princeton, NJ

Brazil

Paris

South Africa

Uganda

Sudan

AlgeriaDubai

Yemen

Sri Lanka

MyanmarThailand

Vietnam

Philippines

Taiwan

Russia

Ukraine

Latvia

Lithuania

Mauritius

SingaporeKenya

Ethiopia

Venezuela

USA

EU

LATAM

CIS

ASIA

HQ: Ahmedabad

AFRICA

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International business- two fold focus

Developed generics markets

• US- the largest generic market in the world

• Zydus Pharmaceuticals Inc.

• Europe- Zydus France SAS

• Planning to enter Spain & Italy

Emerging markets

• CIS - Russia , Ukraine

• Asia Pacific- Sri Lanka, Vietnam, Myanmar

• Africa, Middle East

• Brazil, South America

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Formulations-emergingmarkets

Formulations- developedmarkets

APIs/intermediates- exports

2005-06 US$ 83 mn 2010E US$ 370 mn

International sales projection 60

200110

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US – marketing plan and achievements so far

ANDAs filed - half for matured products. Include 6 blockbusters and 2 NDDS.

Half the products envisage own API.

Plan to file 8-10 more ANDAs by the end of FY 06-07, taking cumulative total to over 55 ANDAs.

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46

46

0 5 10 15 20 25 30 35 40 45 50

ANDA approvals

ANDA filings

DMF filings

Robust regulatory pipeline Marketing and distribution through Mallinckrodt, which is 7th largest generic player in US.

Also doing direct marketing to select customers through own US subsidiary.

Launched 8 products so far (incl. Day 1 launches of Meloxicam & Simvastatin). Response has been excellent with initial market share > 10% in all products.

Sales in first full year of operations (CY 2006) ~ US$ 26 mn.

Plan to launch another 6-8 products in CY 2007 also.

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4.6

1.1

5.1

5.5

4.5

16.1

CY 2004 CY 2005 CY 2006

Sales (mn Euro)

Branded Generics

Launch of generics Launched over 85

generic presentations so far.

Plan to boost the basket with over100 generic presentations by end 2007

Complete focus on Pure Generics

Direct business with pharmacies

Business thru “Evolupharm”, a large buying group representing ~ 2250 pharmacies.

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14

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New product filings fromIndia

Site variation filings

Filed Approved

Relationship with

pharmacists Building special

relationship with pharmacists

Supporting a health awareness program for the Zydus club of pharmacists

Leveraging India’s lower cost Generics to drive our French business

France – key initiatives so far

5.7

10.6

20.6

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Emerging Global Markets

Brazil Pharma market size of ~US$7 bn.,

growing at ~18% (Source : ESPICOM) Filed 30 pure & branded generics

dossiers Received 13 generic product

approvals, and all have been launched.

Plan to file for and launch 8-10 products every year

South Africa Branded generics- commenced

operations

Marketing and distribution partner finalized

Filed 33 submissions, received 11 product approvals so far

Launched 4 products so far, plan to launch 6-8 products every year

Continuous Growth Momentum Presence in over 26 semi / non regulated emerging markets.

Amongst the top three Indian pharma companies in Sri Lanka, Myanmar, Philippines, Uganda and Sudan.

Focusing and developing base in rapidly growing markets of Brazil, Russia and South Africa.

Exports to these markets grew by ~28% in last three years and by 31% during 9 months of FY 06-07.

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Zydus is uniquely positioned on Contract Mfg. Front :

World class state of the art manufacturing facilities.

Dedicated dossier filing and IPR team, enabling rapidity in site transfer projects and competency in development projects.

Zydus’ experience with global partners -

Cost efficient and high quality products and services

Working with several US and European multinationals

Operational transparency with these partners

Dedicated project management teams

Contract manufacturing - exciting prospects

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Altana JV - benchmark in contract manufacturing.

State of the art manufacturing facility set up as an EOU near Mumbai.

Supplying 2 key starting materials of Pantoprazole to its worldwide patent holder, Altana AG, Germany.

60% of global requirements are met from this plant.

Recently increased capacity by 20% from 48 tons to 60 tons.

Mayne Pharma (Australia) - JV for oncology injectibles (Generics).

Setting up cytotoxic facility located in an SEZ near Ahmedabad.

Construction of the plant completed.

Commercial production expected in FY 07-08.

Full capacity utilisation in FY 08-09.

20 other contracts with big innovator and generic MNCs signed so far with peak revenue potential of US$ 27.5 Mio.

Few more contracts in pipeline.

Contract manufacturing - achievements so far

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654

99

247

NME & DrugDiscovery

Generics /Developmental

API & Others

Research Focus

Zydus Research Centre (ZRC)

Located in Ahmedabad

Focused on NME Research & NDDS

Pharmaceutical Technology Centre (PTC)

Located in Ahmedabad

Focused on Finished Dosage Form Development & NDDS

API Process Research

Located in Ankleshwar/Ahmedabad

Focused on Process Development

Revenue R&D Spends – Jan-Dec 06

Scientific Talent Pool ~ 600

65%

10%

25%

Rs. 1000 Mio. (~6% of net sales)

250

100

250

NME & DrugDiscovery

Generics /Developmental

API & Others

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Zydus Research Center - investing for the future

• NME Research, Biologicals (Biogenerics) & NDDS.

• Therapeutic Area: Diabetes, Dyslipidemia, Obesity, Inflammation.

• Infrastructure for target identification to pre-clinical research / early clinical development.

• Lead lipid lowering drug candidate ZYH1 in Phase II clinical trials.

• ZYI1, the Anti-inflammatory & Pain Management compound, completed Phase I trials, while ZYH2, the novel agent for treating diabetes will start Phase I clinical trials soon.

• Recently filed 4th IND - ZYO1, a novel drug candidate for treating Obesity and related disorders.

• Multiple candidates under preclinical stage.

NME IND Filing Phase 1 Phase 2 Phase 3

ZYH1 Dyslipidemia

ZYH2

ZY01

Diabetes

Obesity

ZYI1 Inflammation

Pre Clinical

NME Pipeline

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PTC – New Product Development Team

• Product Development team of 250 scientists

• Infrastructure:

– Development labs

– Pilot Plant

– Analytical Support

– Stability studies

– Pharmacokinetics

• In-house Regulatory, IPR & Packaging development Group

PTC : Scientific Team

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1525

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1080

Formulations DevelopmentAnalytical Development

Pharmacokinetics & Project Mgmt.Regulatory AffairsIPRPackaging Development

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Set up a JV with M/s Bharat Serum and Vaccines Ltd., one of the top 10 biotech companies in India, to develop, manufacture and market a non-infringing and proprietary Novel Drug Delivery System (NDDS) of an approved anti-cancer product for global markets.

Acquired ~ 62% stake in Carnation Nutra-Analogue Foods Ltd., the manufacturers of “Nutralite”, India’s largest selling margarine, currently enjoying a market share close to 60%, which is free from cholesterol and is healthier substitute for butter. This will complement our “Sugar Free”, which is brand leader in life style segment.

Opened up a new subsidiary in Japan - "Zydus Pharma Inc., Japan" to kick start Japanese operations. The subsidiary will market APIs and formulations in Japanese market, and start product registration process in 2007.

Other Recent Developments

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Financial Highlights

Apr-Dec 06 Apr-Dec 05Growth y-y%

Domestic Sales (Net) 9,283 8,575Exports Sales 4,361 2,514Total Net Sales 13,644 11,088 23.0%

Total Operating Income 13,931 11,385

Total Income 14,180 11,430 24.1%

PBIDT 3,059 2,266 35.0%PBIDT % to Total Income 21.6% 19.8%

Net Profit 1,949 1,218 60.1%NP % to Total Income 13.7% 10.7%

EPS Rs. (not annualised) ## 15.52 9.69

## EPS of FY 05-06 is adjusted for bonus shares issued in theratio of 1:1 in Aug-06.

Net Worth 8,893

Total Debt 4,576

Net Fixed Assets 8,994

Net Current Assets 5,257

Rs. Mio.Consolidated

As on 31st Dec 06 (Rs. Mio.)

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Our vision

Zydus shall be a leading global healthcare

provider with a robust product pipeline and

sales of over $1 bn by 2010;

we shall achieve sales of over $3 bn by

2015 and be a research-based

pharmaceutical company by 2020.

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No part of this presentation may be reproduced, quoted or circulated without prior written approval from Cadila Healthcare Ltd..

This presentation may include certain “forward looking statements” , based on current expectations, within the meaning of applicable laws and regulations. Actual results may differ and the company does not guarantee realization of these statements.The Company also disclaims any obligation to revise any forward-looking statements . The viewers may use their own judgement and are advised to make their own calculations before deciding on any matter based on the information given herein

www.zyduscadila.com

Thank You.