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Fresenius SE & Co. KGaA Call Transcript 2008

Jul 7, 2008

166_ip_2008-07-07_ba7ba6d7-13b2-4f53-b3ab-c37d7516c264.pdf

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Fresenius Kabi – Creating a Global Leader in I.V. Generic Drugs

Conference Call, July 7, 2008

Disclaimer

THIS PRESENTATION IS FOR INFORMATION PURPOSES ONLY AND MAY NOT BE FURTHER DISTRIBUTED OR PASSED ON TO ANY OTHER PERSON OR PUBLISHED, IN WHOLE OR IN PART, FOR ANY PURPOSE.

This presentation does not constitute or form part of, and should not be construed as, any offer or invitation to subscribe for, underwrite or otherwise acquire, any securities of Fresenius SE ("Fresenius") or any present or future member of its group nor should it or any part of it form the basis of, or be relied on in connection with, any contract to purchase or subscribe for any securities in Fresenius or any member of its group or any commitment whatsoever.

In particular, this presentation is not an offer of securities in the United States of America (including its territories and possessions), and securities of Fresenius SE may not be offered or sold in the United States of America absent registration under the Securities Act of 1933 (which Fresenius SE does not intend to effect) or pursuant to an exemption from registration.

The information contained in this presentation is for background purposes only and is subject to amendment, revision and updating. Certain statements contained in this presentation may be statements of future expectations and other forwardlooking statements that are based on management's current views and assumptions and involve known and unknown risks and uncertainties. In addition to statements which are forward-looking by reason of context, including without limitation, statements referring to risk limitations, operational profitability, financial strength, performance targets, profitable growth opportunities, and risk adequate pricing, as well as the words "may, will, should, expects, plans, intends, anticipates, believes, estimates, predicts, or continue", "potential, future, or further", and similar expressions identify forward-looking statements. Actual results, performance or events may differ materially from those in such statements as a result of, among other factors, changing business or other market conditions and the prospects for growth anticipated by the management of Fresenius. These and other factors could adversely affect the outcome and financial effects of the plans and events described herein. Forward-looking statements contained in this presentation regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. Fresenius does not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. You should not place undue reliance on forward-looking statements, which speak only as of the date of this presentation.

Acquisition Highlights

  • -APP Pharmaceuticals – a leading U.S. I.V. generic drugs company
  • -Dedicated to the highest quality and medical excellence
    • Successful, well-established company enhancing Fresenius Kabi's profitability
    • Platform for further growth in the U.S. for Fresenius Kabi's existing product portfolio
    • Outstanding opportunity to establish a leading global position in I.V. generic drugs
  • -Experienced and successful management team

APP Pharmaceuticals at a Glance

Business Overview

    • Excellent market reputation with well-recognized I.V. generic drugs
    • Production plants in the U.S. and Puerto Rico
  • -Headquartered in Schaumburg / Illinois
    • Key financials 2007:
    • Sales:647 US\$ m
  • -Adjusted EBITDA* 253 US\$ m
  • -~1,400 employees

* Adjusted EBITDA: EBITDA before one-time expenses and stockoption expenses, as published by APP in Form 8-K, March 10, 2008, as of Dec. 31, 2007

Compelling Strategic Rationale

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* IMS Data, internal research **EPS: before one-time transaction-related depreciation charges and assuming a 2008 closing.

Fresenius Kabi's Product Segments – Growth Through Revenue Synergies

Pharmaceutical products and corresponding medical devices

APP Provides an Excellent Strategic Fit to Fresenius Kabi's I.V. Drug Business

Conference Call – Acquisition of APP Pharmaceuticals - Fresenius SE, Investor Relations © Copyright, July 7, 2008 Page 7 * Primarily for oncological products **not yet closed

APP – Comprehensive Product Portfolio With Leading Positions

* IMS

Attractive Potential of the I.V. Generics Market in the U.S.

The U.S. I.V. generics market has an estimated volume of ~3.6 US\$ bn

Source: IMS, internal research

I.V. Generics Market in the U.S.: Competitive Structure

APP No. 2 manufacturer in the U.S. I.V. generics market

Source: IMS, internal research

Growth in New Product Development: Expected Patent Expirations 2008 - 2015

It is expected that drugs of about 18 US\$ bn branded sales will have gone off-patent by 2015 (based on 2007 revenues)

Growth in New Product Development: ANDAs of APP Pending at FDA End of the Year

APP: Strong Sales and Earnings Contribution

*Adjusted EBITDA reported by APP US\$ 253 m, less US\$ 9.1 m stock compensation (net), as of Dec. 31, 2007;

US\$/€ FX rate of 1.55 used for conversion of APP financials. Subject to change.

Conference Call – Acquisition of APP Pharmaceuticals - Fresenius SE, Investor Relations © Copyright, July 7, 2008 Page 13

Key Transaction Terms

Cash Purchase Price

  • -US\$ 23.00 per share in cash
  • -Equity valued at 3.7 US\$ bn

Contingent Valuation Right (CVR)

  • -Up to US\$ 6.00 per share in cash
    • Payable in 2011 subject to APP exceeding a cumulative financial EBITDA target for calendar years 2008, 2009 and 2010

High Transaction Security

    • Signed voting agreement with APP's >80 % majority shareholder
  • -Board of APP approved the transaction

Financial Impact

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Acquisition of APP – Driving Future Growth

Key strategic opportunity

Entry in the U.S. I.V. generics market

Experienced and successful management team

Growth opportunities for Fresenius Kabi's product portfolio

Attachments

Conference Call – Acquisition of APP Pharmaceuticals - Fresenius SE, Investor Relations © Copyright, July 7, 2008 Page 17

APP – Overview of Key Products

Anti-Infective Agents

  • Ampicillin
  • Ampicillin / Sulbactam
  • Azithromycin
  • Bacitracin
  • Cefoxitin
  • Doxycyclin
  • Gentamicin
  • Kanamycin
  • Vancomycin

Intensive Care

  • Calcium Gluconate
  • Choriogonadotropin
  • Dexamethason
  • Heparin
  • Hydralazin
  • -Oxytocin
  • Protamin
  • Thiamin

Oncology

  • Carboplatin
  • Fluorouracil
  • Mesna
  • Mitoxantron
  • Pamidronate

Anesthetics/Analgesics

  • Astramorph (morphine)
  • Diprivan (propofol)
  • Ketorolac
  • Naropin (Ropivacain)
  • Sensorcaine

(Bupivacaine)

Xylocaine (lidocaine)

Financial Calendar

  • 30.7.2008 Report on 1st half 2008
  • 4.11.2008 Report on 1st-3rd quarters 2008

Contact

Birgit Grund SVP Investor Relations Fresenius SE

Telephone: +49 6172 608-2485 e-mail: [email protected]

For further information and current news: http://www.fresenius.com

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