Acquisizioni in Europa per un traguardo a miliardi Milano, 10 Maggio 2000

Acquisizioni in Europa per un traguardo a miliardi Relatori: Giovanni Recordati Giovanni Recordati Chairman and Chief Executive Officer Chairman and Chief Executive Officer Fritz Squindo Fritz Squindo Chief Financial Officer Chief Financial Officer Walter Bevilacqua Walter Bevilacqua Vice President and Director Corporate Development Vice President and Director Corporate Development 1

Fritz Squindo Chief Financial Officer 2

Where we come from: HIGHLIGHTS 3

4 CAGR % 23.2% 20.0% 8.0% 7.5% 7.4% 18.8% % % % % % % % % % % % % % % % HIGHLIGHTS Net Sales Gross Profit as % of sales reclassified for comparison purposes Operating Income Before R&D as % of sales Operating Income as % of sales Pretax Income as % of sales Net Income as % of sales Cash Flow (billion lira)

Where we are: RESULTS Q P&L TRENDS SALES & MARGINS BY BUSINESS AREA CAPITAL EMPLOYED 5

% % % % % % % % % % % % 16.1% 29.1% 74.1% 150.9% 142.2% 164.6% 62.2% Delta 33.8% RESULTS Q Net Sales Gross Profit as % of sales Operating Income Before R&D as % of sales Operating Income as % of sales Pretax Income as % of sales Net Income as % of sales Cash Flow Q1 (billion lira) R&D Expenses as % of sales

7 2000Q Q2-Q P&L TRENDS (as % of Net Sales) Gross Profit SG&A (a) Operating Income R&D Operating Income before R&D 1999Q (a) Includes amortization of goodwill

% % % % % % % % % % % % 16.1% 29.1% 74.1% 150.9% 142.2% 164.6% 62.2% Delta 33.8% RESULTS Q Net Sales Gross Profit as % of sales Operating Income Before R&D as % of sales Operating Income as % of sales Pretax Income as % of sales Net Income as % of sales Cash Flow Q1 (billion lira) R&D Expenses as % of sales

Where we are: RESULTS Q P&L TRENDS SALES & MARGINS BY BUSINESS AREA CAPITAL EMPLOYED 9

10 Q % SALES & MARGINS BY BUSINESS AREA Q1-00 Q1-00 Net Sales Operating Margin % % Q % PHARMACEUTICALS PHARMA CHEMICALS DeltaDelta % % % + 6.6% (billion lira)

/ (36.5) (35.5) CAPITAL EMPLOYED Net Working Capital for Operations Net Non-current Assets Reserves for Long - term Liabilities FINANCING OF CAPITAL EMPLOYED Net Debt Shareholders’ Equity CAPITAL EMPLOYED /03 (billion lira)

Where we are going: TARGETS 12 NET SALES & OPERATING MARGIN CAPITAL EMPLOYED

TARGETS Net Sales Gross Profit as % of sales EPS (lira) Operating Income as % of sales % % % 931 R&D % % % % % % 3092 CAGR % 18.8% 14.2% 36.7% 35.0% (billion lira)

14 EVOLUTION OF NET SALES & OPERATING MARGIN (billion lira) Net Sales Operating Margin 7.1% 10.4% 11.0% 12.1% 13.0%

(30) (36) (39) (33) (36) EVOLUTION OF CAPITAL EMPLOYED Net Working Capital for Operations Net Non-current Assets Reserves for Long - term Liabilities FINANCING OF CAPITAL EMPLOYED Net Debt Shareholders’ Equity CAPITAL EMPLOYED (billion lira)

Walter Bevilacqua Vice President and Director Corporate Development 14

How we are going to get there: 17 THE STARTING POINT DRIVERS OF GROWTH RECORDATI IN 2003 BEYOND 2003

18 THE STARTING POINT CAGR Net Sales Gross Profit +18.9% +23.2% Growth % +29.1% A new level of sales & profitabilityA new level of sales & profitability Concentration on core activities and key productsConcentration on core activities and key products

19 DRIVERS OF GROWTH  Stronger, more efficient market presence  Zanidip ®  Acquisitions  Licensed-in products  R&D Pipeline

20 DRIVERS OF GROWTH  Stronger, more efficient market presence  Zanidip ®  Acquisitions  Licensed-in products  R&D Pipeline

21 EFFICIENT MARKET PRESENCE Italy, Spain: work done in Italy, Spain: work done in France, Portugal: France, Portugal: Jan-Feb1999 Growth over prior year; value Market Market Recordati Recordati Jan-Feb2000 Trend Market share; value Relative (to Roche) Relative (to Roche) Absolute Absolute 6.2%9.9%13.6%23.8% 23.3%1.31%25.3%1.43% (Italy, Market Audits) Source: IMS

22 STRONG MARKET PRESENCE  What is market share good for: - efficient local operations - share of voice for new product introduction - attractive in-licensing partner  Where is Recordati? - strong in Italy - France covered with acquisition - build-up planned in Portugal, Spain

23 DRIVERS OF GROWTH  Stronger, more efficient market presence  Zanidip ®  Acquisitions  Licensed-in products  R&D Pipeline

24 ZANIDIP ® ITALY Excellent performance where it has been introduced Excellent performance where it has been introduced Jan-Feb1999 Zanidip ® 3.7 Jan-Feb Growth % 91 Norvasc ® Recordati licensees Relative market share of Zanidip ® to: Norvasc ® Norvasc ® Rest of class Rest of class Room to grow thereRoom to grow there Rest of class Trend (billion lira) Italy Source: IMS

25 ZANIDIP ® INTERNATIONAL EXPANSION World pharmaceutical markets, 1999World pharmaceutical markets, 1999 $ bn USJapan France, Germany Italy, Uk, Spain % of world (billion lira) Zanidip ® launched in:Zanidip ® launched in: Q12000Q12003Q4 US, Japan France, Germany Italy, Uk, Spain Other countries Source: Scrip

26 DRIVERS OF GROWTH  Stronger, more efficient market presence  Zanidip ®  Acquisitions  Licensed-in products  R&D Pipeline

27 BOUCHARA (FF million) All data preliminary and subject to audit; transaction subject to contract (a) Bouchara fiscal year ending 30 September 1999 (a) 10% - Export Net debt Net worth Purchase Price (preliminary) Operating Margin Net Sales Manufacturing Total Sales Pharmaceuticals - France

28 BOUCHARA Pharmaceuticals France, 1999 (a) (a) Bouchara fiscal year ending 30 September Units(millions)Rank in class Revenues (FF millions) Rank in class (Source BOUCHARA, GERS) Therapeutic area Cough & Cold of which - Exomuc - Neo- codion - Isofra Antibiotics & Anti-infectives of which - Amodex - Panfurex CNS Cardiovascular Other Total

29 ACQUISITIONS & LICENSED-IN PRODUCTS  In the target numbers: - Bouchara - New licenses, 30 billion lira  Not in the target numbers: - Acquisitions in Portugal, Spain - Additional licenses

30 UPSIDE, other  Not in the target numbers: - Zanidip ® in US, Japan

31 RECORDATI IN 2003 Net sales Pharmaceutical s Italy Pharmaceutical Chemicals Other Countries CAGR % 21.0% 7.7% 10.7% 23.1%

32 BEYOND 2003 Operations Established market participant in:Established market participant in: 1999 Italy 2003 International growth of Zanidip ® continuesInternational growth of Zanidip ® continues New productsNew products - licenses - own R&D - - France Spain Portugal

33 BEYOND 2003 R&D  The future of Zanidip ® : - fixed association - atherosclerosis / LVH - total gene expression studies  Urogenital R&D target indications: - urge incontinence /overactive bladder - benign prostatic hypertrophy - female sexual dysfunction (possibly)

Acquisizioni in Europa per un traguardo a miliardi Milano, 10 Maggio 2000