worldwide sales report (us $'000)

WORLDWIDE SALES REPORT (US $'000) PAGE 8

September 2012

Actual MYE Budget MYE To Go MYE RoY To Go MRR YTD MRRUS$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000

A B C D = C - A E = C - B F = D / 3 G = A / 9 G v FNote 1 Note 2 Note 3

USA (Purdue Pharma LP) 1,595,654 1,648,993 2,398,265 2,237,917 642,262 588,924 214,087 177,295 21%

Germany (Mundipharma GmbH) 261,215 262,441 359,953 359,605 98,390 97,164 32,797 29,024 13%

Canada (Purdue) 251,791 246,247 330,997 327,720 75,929 81,473 25,310 27,977 On target

UK (Napp Pharmaceuticals Ltd) 196,514 196,935 262,825 258,719 62,205 61,784 20,735 21,835 On target

Australia (Mundipharma Pty Ltd) 108,964 109,017 147,423 147,423 38,459 38,406 12,820 12,107 6%

Nordic (Norpharma/Mundipharma) 78,042 77,541 104,271 101,915 23,873 24,375 7,958 8,671 On target

France (Mundipharma SAS) 54,813 55,428 77,561 74,781 19,968 19,353 6,656 6,090 9%

Italy (Mundipharma Srl) 40,874 40,705 54,936 55,192 14,318 14,487 4,773 4,542 5%

Switzerland (Mundipharma Medical Co) 37,688 38,165 49,731 49,731 12,043 11,566 4,014 4,188 On target

Austria (Mundipharma GesmbH) 32,299 31,442 41,682 41,714 9,415 10,272 3,138 3,589 On target

China (MCPC) 34,621 31,600 42,481 42,481 7,860 10,881 2,620 3,847 On target

Spain (Mundipharma SL) 25,998 26,800 38,463 35,907 9,909 9,107 3,303 2,889 14%

Netherlands (Mundipharma Pharmaceuticals BV) 29,257 28,052 35,470 37,896 8,639 9,845 2,880 3,251 On target

Eastern Europe (Mundipharma Medical GmbH) 13,635 13,944 22,144 19,964 6,328 6,020 2,109 1,515 39%

Korea (Mundipharma Korea Ltd) 17,356 14,129 19,862 19,649 2,293 5,519 764 1,928 On target

Ireland (Mundipharma Pharmaceuticals Ltd) 11,857 12,154 16,900 16,907 5,050 4,753 1,683 1,317 28%

Philippines (M Dist GmbH) 11,046 10,613 14,179 14,146 3,100 3,533 1,033 1,227 On target

Belgium (Mundipharma CVA) 7,669 8,145 11,429 11,020 3,350 2,875 1,117 852 31%

Poland (Norpharma) 6,158 5,614 9,060 7,568 1,410 1,955 470 684 On target

New Zealand (Mundipharma NZ Ltd) 5,548 5,929 8,065 8,065 2,517 2,136 839 616 36%

South Africa (Mundipharma Pty Ltd) 1,069 1,019 2,504 1,863 793 844 264 119 123%

Malaysia (Mundipharma Pharmaceuticals Sdn Bhd) 1,748 1,613 2,515 2,515 768 902 256 194 32%

Singapore (Mundipharma Pharmaceutical Pte Ltd) 802 788 1,074 1,074 272 286 91 89 2%

Portugal (Mundipharma Farmaceutica Lda) 314 295 385 385 71 90 24 35 On target

Hong Kong (Mundipharma (Hong Kong) Ltd) 439 560 1,003 1,003 563 443 188 49 285%

TOTALS (US $'000) 2,825,371 2,868,168 4,053,176 3,875,159 1,049,787 1,006,990 349,929 313,930

Note 1 'To Go' indicates the sales required over the remainder of the year in order to achieve MYE.Note 2 'MYE RoY' indicates the MYE sales over the remainder of the year.Note 3 Indicates the increase in average monthly sales needed to achieve MYE. 'On target' indicates that the YTD MRR is ahead of that required to achieve the MYE.

Monthly Run Rate ('MRR')Required

Increase v YTD MRR

STRICTLY CONFIDENTIAL

Year to Date Full Year 2012 To Go

SUMMARY OF SALES PERFORMANCE (RUN-RATE) BY COUNTRY

WORLDWIDE SALES REPORT (US $'000) PAGE 9

September 2012

USA Canada Nordic Germany Ireland Australia UK Neths. Switzerland E.Europe Austria Korea France Spain Italy New Zealand AsiaPacific China Belgium Poland South Africa

(Purdue Pharma LP) (Purdue Pharma)(Norpharma /

Mundipharma)(Mundipharma

GmbH)(Mundipharma

Pharm. Ltd)(Mundipharma Pty

Ltd)(Napp Pharma.

Ltd)(Mundipharma

Pharm. BV)(Mundipharma Medical Co)

(Mundipharma Medical GmbH)

(Mundipharma GesmbH)

(Mundipharma Korea Ltd)

(Mundipharma SAS) (Mundipharma SL) (Mundipharma Srl)

(Mundipharma NZ Ltd)

(Philippines, Malaysia, S'pore) (MCPC)

(Mundipharma CVA) (Norpharma)

(Mundipharma Pty Ltd)

Date of Launch > Dec 95 Jun 96 Dec 96 Aug 98 Jan 99 Sep 99 Jan 00 Dec 00 Feb 01 Feb 01 Mar 01 Mar 01 Apr 02 Jun 04 Mar 05 Jul 05 Jul 05 Aug 04 Feb 07 Jul 08 Mar 12 Sales Total AverageUS$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000

1996 47,982 122 12 48,116 48,116 4,0101997 133,255 1,014 240 134,509 134,509 11,2091998 273,219 2,614 646 2,669 279,148 279,148 23,2621999 562,570 5,111 1,541 10,956 228 580,405 580,405 48,3672000 951,446 9,583 2,620 14,612 326 1,663 2,320 22 982,592 982,592 81,883

96.8% 1.0% 0.3% 1.5% 0.0% 0.2% 0.2% 0.0% 100.0%2001 1,232,159 18,349 4,783 21,915 553 3,985 6,639 351 41 92 262 1,419 1,290,548 1,290,548 107,546

95.5% 1.4% 0.4% 1.7% 0.0% 0.3% 0.5% 0.0% 0.0% 0.0% 0.0% 0.1% 100.0%

2002 1,269,342 29,691 9,739 37,060 845 6,681 11,793 1,333 213 283 662 2,200 629 1,370,471 1,370,471 114,20692.6% 2.2% 0.7% 2.7% 0.1% 0.5% 0.9% 0.1% 0.0% 0.0% 0.0% 0.2% 0.0% 100.0%

2003 1,619,821 52,889 17,213 62,176 1,233 10,809 20,052 3,196 1,097 945 948 3,607 1,652 1,795,638 1,795,638 149,63790.2% 2.9% 1.0% 3.5% 0.1% 0.6% 1.1% 0.2% 0.1% 0.1% 0.1% 0.2% 0.1% 100.0%

2004 1,334,601 75,404 22,170 79,186 1,262 16,051 24,696 5,655 2,208 1,681 1,360 5,533 3,345 336 1,573,488 1,573,488 131,12484.8% 4.8% 1.4% 5.0% 0.1% 1.0% 1.6% 0.4% 0.1% 0.1% 0.1% 0.4% 0.2% 0.0% 100.0%

2005 941,705 93,960 27,676 114,711 1,988 20,032 33,687 7,317 3,300 3,537 1,399 5,663 5,404 1,169 839 103 345 1,262,836 1,262,836 105,23674.6% 7.4% 2.2% 9.1% 0.2% 1.6% 2.7% 0.6% 0.3% 0.3% 0.1% 0.4% 0.4% 0.1% 0.1% 0.0% 0.0% 100.0%

2006 605,123 124,231 32,382 130,001 1,869 24,704 42,330 9,420 4,551 4,437 1,852 8,629 7,209 1,927 3,104 505 644 1,002,915 1,002,915 83,57660.3% 12.4% 3.2% 13.0% 0.2% 2.5% 4.2% 0.9% 0.5% 0.4% 0.2% 0.9% 0.7% 0.2% 0.3% 0.1% 0.1% 100.0%

2007 955,636 152,630 41,294 90,966 2,404 33,018 57,144 11,982 6,425 6,718 2,274 11,035 10,126 3,066 6,690 1,198 954 2,421 516 1,396,496 1,396,496 116,37568.4% 10.9% 3.0% 6.5% 0.2% 2.4% 4.1% 0.9% 0.5% 0.5% 0.2% 0.8% 0.7% 0.2% 0.5% 0.1% 0.1% 0.2% 0.0% 100.0%

2008 2,114,078 164,773 44,031 69,907 2,717 36,032 52,130 13,052 8,914 8,635 2,657 8,663 13,958 5,333 10,242 1,612 1,316 4,444 1,628 8 2,564,130 2,564,130 213,67782.4% 6.4% 1.7% 2.7% 0.1% 1.4% 2.0% 0.5% 0.3% 0.3% 0.1% 0.3% 0.5% 0.2% 0.4% 0.1% 0.1% 0.2% 0.1% 0.0% 100.0%

2009 2,457,763 181,732 45,943 62,779 2,876 42,270 56,581 9,269 10,037 8,874 2,665 9,523 18,718 6,764 17,688 2,261 1,556 6,308 2,278 24 2,945,909 2,945,909 245,49283.4% 6.2% 1.6% 2.1% 0.1% 1.4% 1.9% 0.3% 0.3% 0.3% 0.1% 0.3% 0.6% 0.2% 0.6% 0.1% 0.1% 0.2% 0.1% 0.0% 100.0%

2010 2,267,670 205,224 40,016 50,960 2,965 54,863 53,388 14,691 11,468 10,799 1,973 10,219 22,902 8,206 24,384 3,396 1,864 8,509 3,257 134 2,796,889 2,796,889 233,07481.1% 7.3% 1.4% 1.8% 0.1% 2.0% 1.9% 0.5% 0.4% 0.4% 0.1% 0.4% 0.8% 0.3% 0.9% 0.1% 0.1% 0.3% 0.1% 0.0% 100.0%

Jan-11 139,062 15,860 4,118 3,511 256 5,250 3,924 1,391 1,162 225 123 888 1,952 589 2,031 351 157 806 356 78 182,092 2,783,299 231,942Feb-11 143,248 15,594 3,186 3,764 247 4,216 3,960 1,356 1,062 972 130 874 1,980 592 1,989 347 96 585 282 87 184,568 2,767,453 230,621Mar-11 222,636 18,904 4,304 3,905 243 7,512 5,882 1,540 1,194 478 135 913 2,185 571 2,015 269 232 1,198 381 80 274,576 2,799,093 233,258Apr-11 186,736 18,453 3,548 3,423 297 6,039 5,258 1,420 977 1,044 120 706 2,142 648 2,253 297 192 1,281 340 116 235,288 2,751,116 229,260May-11 156,181 18,454 3,857 3,669 263 5,248 5,319 1,484 1,162 880 120 869 2,346 439 1,819 304 204 1,252 399 152 204,419 2,737,043 228,087Jun-11 205,044 18,578 4,157 3,910 290 5,216 5,885 1,573 1,245 890 131 815 2,529 635 2,054 336 217 1,313 290 108 255,215 2,748,465 229,039Jul-11 152,981 17,841 2,867 3,246 259 5,171 5,027 1,357 1,089 1,224 129 889 2,342 604 3,342 359 225 1,247 340 183 200,722 2,707,353 225,613

Aug-11 170,822 19,403 3,453 3,885 283 5,391 5,477 1,400 1,201 708 128 781 2,329 474 1,254 306 230 1,164 264 170 219,121 2,620,030 218,336Sep-11 173,038 17,520 3,944 3,068 277 5,392 5,037 1,474 1,073 547 134 798 2,466 607 1,957 414 148 1,287 526 128 219,837 2,597,194 216,433Oct-11 141,898 17,261 3,689 3,588 221 6,014 5,276 1,363 1,072 763 49 1,019 2,420 426 2,136 274 257 1,199 189 312 189,426 2,558,106 213,176Nov-11 165,345 19,134 3,948 3,622 302 5,617 5,747 1,405 1,175 713 66 775 2,554 623 2,915 302 220 1,199 404 127 216,194 2,571,784 214,315Dec-11 188,917 18,455 4,387 3,988 292 5,431 5,571 1,445 1,196 720 76 895 2,813 348 1,111 395 223 1,248 369 288 238,169 2,619,627 218,302

2011 2,045,908 215,457 45,460 43,576 3,229 66,497 62,363 17,209 13,608 9,165 1,342 10,222 28,057 6,556 24,876 3,954 2,402 13,779 4,140 1,829 2,619,627 2,619,627 218,30278.1% 8.2% 1.7% 1.7% 0.1% 2.5% 2.4% 0.7% 0.5% 0.3% 0.1% 0.4% 1.1% 0.3% 0.9% 0.2% 0.1% 0.5% 0.2% 0.1% 100.0%

Jan-12 114,958 18,212 3,159 2,821 214 6,122 5,657 1,344 1,063 22 28 916 2,229 511 2,422 363 264 1,290 236 96 161,926 2,599,461 216,622Feb-12 127,009 23,526 3,728 2,834 233 4,873 4,722 1,430 994 267 35 766 2,221 508 1,600 347 222 1,462 337 121 177,237 2,592,131 216,011Mar-12 225,184 21,549 3,230 2,991 227 5,701 5,765 1,354 1,060 1,186 46 732 2,396 458 1,294 255 206 1,637 377 224 28 275,899 2,593,454 216,121Apr-12 149,161 11,872 2,348 2,816 235 5,635 5,378 1,296 973 309 44 754 2,510 545 1,899 319 340 1,458 277 308 28 188,506 2,546,671 212,223May-12 199,012 10,601 2,559 2,880 246 5,272 6,687 1,453 1,023 449 46 808 2,608 481 1,964 400 183 1,682 365 295 53 239,069 2,581,321 215,110Jun-12 145,696 10,952 2,239 3,095 229 6,363 6,726 1,564 1,057 636 42 864 2,618 647 1,215 310 135 1,748 219 122 31 186,508 2,512,614 209,385Jul-12 155,532 14,185 2,491 3,068 217 5,439 5,264 1,507 1,011 524 40 871 2,742 443 2,736 340 227 1,754 381 307 72 199,151 2,511,043 209,254

Aug-12 196,367 12,156 2,470 2,754 241 5,530 6,006 1,832 935 562 39 689 2,636 193 881 309 179 1,915 301 319 58 236,370 2,528,292 210,691Sep-12 129,031 9,447 2,311 2,925 238 5,240 5,522 1,538 883 671 34 745 2,242 372 883 307 293 2,144 251 185 83 165,344 2,473,799 206,150

2012 1,441,950 132,499 24,537 26,184 2,081 50,175 51,727 13,317 8,999 4,626 353 7,145 22,203 4,158 14,894 2,949 2,049 15,089 2,745 1,977 353 1,830,010 2,473,799 206,15078.8% 7.2% 1.3% 1.4% 0.1% 2.7% 2.8% 0.7% 0.5% 0.3% 0.0% 0.4% 1.2% 0.2% 0.8% 0.2% 0.1% 0.8% 0.1% 0.1% 0.0% 100.0%

GRAND TOTAL1996 - 2012 YTD 20,254,229 1,465,281 360,302 817,659 24,576 366,780 474,849 106,813 70,861 59,792 17,747 83,858 134,203 37,514 102,717 15,977 11,129 50,550 14,564 3,972 353 24,473,727

STRICTLY CONFIDENTIAL

12 Mth Monthly Moving

12 Mth RollingTotal Monthly

OXYCONTIN SALES HISTORY

JOINT VENTURES SALES REPORT STRICTLY CONFIDENTIAL PAGE 10

YEAR TO DATE SEPTEMBER 2012

2012 2011 2012 2012Actual Actual MYE 2011 Actual Actual vs. MYEUS$'000 US$'000 US$'000 US$'000 % US$'000 %

Israel (Rafa Laboratories Ltd) OxyContin 1,887 2,172 1,973 (285) 86.9 (86) 95.6Targin / Targinact 2,215 1,777 2,151 438 124.6 64 103.0Other Oxycodone 813 783 769 30 103.8 44 105.7

Morphine 373 429 408 (56) 86.9 (35) 91.4BuTrans 651 645 683 6 100.9 (32) 95.3Adizem 122 227 161 (105) 53.7 (39) 75.8Non Mundipharma products 41,281 39,262 40,051 2,019 105.1 1,230 103.1

47,342 45,295 46,196 2,047 104.5 1,146 102.5India (Modi Mundipharma Ltd)

Analgesic 8,320 7,337 9,034 983 113.4 (714) 92.1

Betadine 24,808 22,680 25,408 2,128 109.4 (600) 97.6Respiratory 3,471 4,137 3,819 (666) 83.9 (348) 90.9Cardiovascular 7,671 7,179 8,112 491 106.8 (442) 94.6Laxative 100 107 64 (7) 93.4 36 155.7Non Mundipharma products 19,338 17,745 20,915 1,593 109.0 (1,576) 92.5

63,708 59,185 67,353 4,523 107.6 (3,645) 94.6Cyprus (Mundipharma Pharmaceuticals Ltd)

Analgesic 477 436 474 41 109.4 3 100.5

Betadine 1,059 1,029 1,052 30 103.0 7 100.7Respiratory 313 241 298 72 129.8 15 105.1Cardiovascular 41 46 46 (5) 89.4 (5) 89.1Laxative 52 58 62 (6) 88.8 (10) 83.7Hedrin 181 178 186 3 101.6 (5) 97.5Oncology 162 46 111 116 352.5 52 146.5Non Mundipharma products 2,338 3,580 2,308 (1,242) 65.3 30 101.3

4,623 5,614 4,536 (991) 82.3 87 101.9

TOTAL 115,673 110,095 118,085 5,579 105.1 (2,412) 98.0

MONTH OF SEPTEMBER 2012

2012 2011 2012Actual Actual MYE 2011 Actual Actual vs. MYEUS$'000 US$'000 US$'000 US$'000 % US$'000 %

Israel (Rafa Laboratories Ltd) OxyContin 197 188 173 9 104.8 24 113.9Targin / Targinact 251 186 254 65 134.9 (3) 98.8Other Oxycodone 84 75 70 9 112.0 14 120.0

Morphine 32 28 27 4 114.3 5 118.5BuTrans 63 49 73 14 128.6 (10) 86.3Adizem 8 14 13 (6) 57.1 (5) 61.5Non Mundipharma products 4,861 5,041 4,593 (180) 96.4 268 105.8

5,496 5,581 5,203 (85) 98.5 293 105.6India (Modi Mundipharma Ltd)

Analgesic 923 818 1,140 105 112.8 (218) 80.9

Betadine 3,149 2,879 3,244 270 109.4 (95) 97.1Respiratory 385 388 412 (3) 99.3 (27) 93.5Cardiovascular 851 823 987 28 103.4 (136) 86.2Laxative 31 18 17 13 173.9 14 178.7Non Mundipharma products 2,233 2,014 2,738 219 110.9 (505) 81.5

7,571 6,939 8,538 632 109.1 (967) 88.7Cyprus (Mundipharma Pharmaceuticals Ltd)

Analgesic 47 31 45 15 149.2 2 104.0

Betadine 126 115 123 10 108.9 3 102.1Respiratory 29 32 71 (2) 92.6 (42) 41.3Cardiovascular 5 4 4 0 101.2 0 100.3Laxative 6 7 7 (0) 93.8 (1) 90.4Hedrin 43 45 45 (3) 93.6 (2) 94.9Oncology 27 0 14 27 13 194.4Non Mundipharma products 253 420 256 (167) 60.3 (3) 98.7

535 655 566 (120) 81.7 (31) 94.6

TOTAL 13,602 13,174 14,307 428 103.2 (705) 95.1

20122012 Actual vs

2012 Actual vs

1

2013 Capital Budget ProposalNovember 2012

2013 Capital Request - $21.5 mm

2

Note: Average capital over the last 4 years was $41 mm. 2013 request is lower than average because there was no new projects like the Wilson expansion (2009), Stamford 6th and 8th floor fit-out (2009) or new plant (approved late 2012).

3

2013 Data Center Hardware Refresh $4.5 mm 1

The total cost of Purdue’s investment in data center, server, storage and communication hardware is $30.0 mm.

This equipment has a life expectancy of 3-5 years depending on device type and is proactively replaced before failure to ensure a good balance between down time and lost data risk and cost.

The new equipment will be more cost effective than the equipment being replaced. That savings vs. the retired equipment is approximately $2.0 mm and is anticipated in the above proposal.

1 The 2013 Budget Proposal includes replacing 4 internet firewalls, 3 DMZ switches, the tape based backup for long term retention requirements and network attached storage (“NAS”). This refresh will replace 30 servers of the current 200 physical servers (absolute number of servers will reduce over time as we consolidate servers using newer technologies) and expanding all storage by 20%.

BENEFIT – routine replacement of older equipment reduces downtime and increases reliability

SAP Software Migration to a New Server and Data Base Environment

SAP software helps Purdue manage a very broad range of activities from billing to collection, from production planning to shipping, from purchase of clinical supplies to end of study close out, from hiring to training employees and more. SAP no longer supports it’s software when it is run on older

infrastructure such as Purdue’s. As a result, any failures would have to be resolved without SAP expertise and could result in significant down time. SAP currently runs across 200 physical servers. The new

environment will run on approximately 40 physical servers and the newer “virtual server” technology. Implementing the new environment will require the following costs:• $0.5 mm in hardware for the 40 physical servers and to support the new storage environment.• $0.4 mm in new software that monitors SAP performance in the new environment• $1.1 mm of EMC and SAP certified database and SAP migration consulting expertise.

4

$2.0 mm

5

Non-Sales Force PC Replacement of equipment nearing end of useful life $0.6 mm

Our non-Sales Force PC’s are replaced every 4-5 years, on average. This replacement cycle balances new equipment cost with the cost of maintenance, support calls and user downtime.

BENEFITS:• Reduce startup/shut down time• Increase battery life for mobile

users• Improve system speed and

performance

• Improve security over Purdue data• Allow Purdue to work with new applications

being developed in this environment• Support for the old environment stops

Quantity Price CostLaptops 250 $1,300 $325,000Desktops 255 750 191,250Evaluation Equipment 110,000

455* $626,000

* The 2012 proposal includes 350 to replace active machines, 80 to support the hiring of open positions / growth and 25 for upgrades from XP that will not run on older machines. All purchases are made in bulk and competitively bid to ensure good pricing.

6

Wilson HYD Readiness $4.1 mm

Status of R&D DevelopmentThe phase 3 clinical studies complete enrollment in Q3 2013. We plan to submit an NDA in Q2 2014 and launch in Q3 2015.

Why Now ??The equipment required to produce HYD tablets does not exist at Wilson.

In order to meet the Q3 2015 launch date, the equipment lead times would require us to make purchase commitments by May 2013.

NDA submissionQ2 2014

FDA Meetings

Market launch Q3 2015

Wilson HYD Readiness – Phasing of Spend

Pre-NDA

Equipment Commitments (May 2013) $2.7 mm

Installation/Qualification $1.4 mm

Process Validation / Launch QuantityBuild

Nov 2014 –Sep 2015.

2014 20152013

Manufacturing/Process Key Dates

Key Project Dates

Phase 3 study enrollment completesQ3

2013

7

8

Wilson HYD Readiness $4.1 mm

The HYD “Tablet in a Tablet” final dosage form is film coated and printed. The “Tablet in a Tablet” operation and tablet printing are new formats for the Wilson site that will require the following equipment:

Tablet in Tablet Press $1.6Equipment installation/qualification 0.8Intermediate Bulk Containers 0.4Misc Equipment 0.4Tablet Printer 0.3Renovations and Design 0.3Contingency 0.3TOTAL $4.1

Tablet Cross SectionTablet in a Tablet

Actual indicia will be different

Replace Electronic Accounts Payable Approval Routing System

9

The current electronic scanning, imaging and routing software allows Purdue to process thousands of vendor invoices quickly and efficiently, with system controls over approvals.

Our current system, “IXOS”, was implemented in January 2002. The system is no longer being supported and has fallen behind current technology which now is offering a web front end, mobile and OCR technologies and more.

BENEFITS:1. With invoices scanned into a central system, there is full visibility of the

location and status of an invoice.2. Electronic imaging eliminates manual invoice routing / approval throughout

the company locations and it eliminates lost invoices. 3. Invoice research can be done on pending, approved and paid invoices real-

time by individuals throughout the company.4. Vendor inquires on outstanding invoices are handled within a few minutes

while an Accounts Payable Associate is on the phone with a vendor.

$0.4 mm

10

Cranbury HPLC/Dissolution Equipment $0.4 mm

• High Performance Liquid Chromatography (“HPLC”) equipment is used in Cranbury for formulation development work to test purity, degradation and dissolution.

• There are 16 HPLC systems in Cranbury (8 stand alone, 8 w/dissolution) which are used continuously and are business critical for analytical techniques used for all projects in all stages of development.

• Older equipment experiences more frequent failures. Downtime to repair these machines varies from a day or two to a couple of weeks and can create risk when managing to GMP testing windows. New systems will reduce downtime.

• This budget is to replace 3 units in-use since approximately 1998

11

Cranbury Vault Expansion $0.35 mm

• The current 396 square foot vault houses 6 stability chambers 1 and an inventory storage area for API, analytical samples, waste, clinical packaging verification kits and more. Both the stability chambers and the storage area are at maximum capacity.

• Converting a 380 square foot vacant room opposite the current vault into a 2nd vault would allow for an increase in the number of stability chambers to 10 and would increase the controlled substance storage capacity by 100% 2.

Consequences of not increasing vault capacity:1. Increased cost of samples stored at outside vendors’ sites and more

time consuming oversight required by analytical personnel.2. Current overcrowding creates safety issues and potential issues with

DEA and FDA inspections.1 Stability chambers are temperature and humidity controlled and are used to store stability samples in different conditions.2 Using the entire space of the vacant room provides the appropriate capacity for projected volumes. Most of the cost of creating the 2nd vault is independent of size – parsing out only part of the room would not significantly reduce cost and would not be an effective use of the space.

Wilson General Capital Projects $0.7 mm

Capital projects include: Support smaller manufacturing equipment additions

and replacement as needed.

Upgrade or maintain the Wilson facility like minor construction projects, heating & cooling end of life replacement.

Upgrade truck access to the facility and related security.

12

Uninterrupted Power Supply - Stamford • Purdue currently has a single, not backed up, UPS1 for the Stamford

datacenter. It is a best practice for data centers to have a back-up UPS.• Without a back-up UPS, in a failure (street power failure plus primary

UPS failure) all company functions dependent on IT infrastructure will fail across all sites. While the back-up data center in Wilson may restore operation of key systems within 48 hours, this is contingent on being able to quickly deploy staff to Wilson, and many non-core systems could take up to 2-3 weeks to restore.

• A high level engineering design has estimated that the cost to implement an effective uninterrupted power supply solution across Purdue sites would cost $2.1 mm.BENEFIT – Reduce risk of system wide outage.

13

1 UPS systems provide instantaneous power to IT systems, via batteries, thus allowing switchover to back-up generators and/or allow an orderly shutdown of systems when there is a power outage. The current UPS was installed in 2000, is now end of life and was down approximately 26 hours in 2011. It is being replaced. This project adds a second UPS.

2 The initiation of this project is contingent upon presenting a final engineering proposal in late 2012 to the Capital Committee and the President/CEO.

$2.1 mm2

Health Outcomes Analytics $0.45 mm1

Managed Care organizations demand economic outcomes data to support reimbursement of new medicines.

Certain health outcomes data will be derived from massive data bases purchased from healthcare provider organizations.

This project includes purchase of a high speed server and the creation of a database to support approximately 10 health outcomes projects anticipated in 2013 and development of mobile technology to enable presentation of reports to be made to third parties on mobile devices.

BENEFIT:Provide needed health outcomes data and analyses to managed care decision makers to help drive formulary coverage.

14

1 Initiation of project is contingent upon presenting a full project plan, justification and budget to the Capital Committee and President.

15

Marketing Analysis Tools $0.4 mm1

• Current marketing tools were built when analysis of IMS data was focused on trends at a national and specialty level.

• In recent years, marketing analysis has become much more granular focusing on individual prescribers, responses to speakers meetings, samples, e-details, sales calls and more.

• The proposal is to purchase high speed IT equipment and related software tools that will enable:1. Quicker and easier performance of these analysis;2. Enable marketing to quickly determine ROI of a specific program,

ROI of a blend of programs and better target investments.


16

Key Opinion Leader, Health Care Consultant and Investigator Search Engine $0.3 mm1

Provide a search and reporting tool that will facilitate the retrieval of Purdue key opinion leader, health care consultant and investigator information from databases maintained across departments.

BENEFITS:1. Provides an automated way to retrieve information from multiple

systems in a single search. 2. Will provide better data to departments on existing relationships that

could be utilized in identifying investigators, speakers and more.


18

Wilson Analytical LCMS System $0.25 mm1

This equipment is required to detect and measure lower level degradents found in ORF. This lower level of degradents is not detected by current equipment.


Back-Up

20

2013 Capital Request of $21.5 mm

To put this request into perspective the last four years approved capital budgets have averaged $41 mm

(1) 2012 includes $10 mm approved for phase 1 of new plant.

(2) 2009 includes $8.0 mm for the One Stamford Forum sublease fit out (floors 6 and 8) and $6.5 mm for the Wilson warehouse and vault expansion.

21

2013 Capital Requests by Functional Area

22

2013 Capital Requests - Projects < 0.3 mm

Project Name Capital Budget

IT Security enhancement-allows approved applications to run in Purdue $280,000environment and blocks any unauthorized application that find their way into theenvironment (e.g. mal ware)

Expand quality management system to include investigations, change control 250,000third party supplier scorecard and more

Totowa site maintenance capital fund 250,000Next generation experimental IT technology fund 245,000Totowa phase-1 HVAC upgrades 240,000Wilson dust containment system for tablet press 240,000Analgesic sales force iPad development 225,000Cranbury miscellaneous capital 220,000Wilson redundant power supply to IT data & telecom areas 215,000Human Resources system in SAP - upgrade 200,000Upgrade/replace video conference systems at our major sites 200,000Commercial systems disaster recovery upgrade 200,000Cranbury lab equipment to support new ex-vivo studies 175,000Replacement projectors in 8 conference rooms used by Sales Training 160,000Replacement of old furniture due to routine wear & tear or ergonomic concerns 150,000Projects <159K (50 projects) 3,856,000

Total for Projects <300K $7,106,000

Retirement Plan Review & Request For Board Decision

David E. LongEdward B. Mahony

Purdue Retirement Plan Management is proposing the creation of a new Defined

Contribution Savings Plan that over the long term will have a lower and more predictable cost structure than the current pension plan. Proposal revised after October 5 meeting based on comments

from Board members Revised eligibility for maintaining Pension Plan participation

to include age + service requirement Current proposal provides both short-term and long-term

savings while addressing funding volatility. Management requests a Board Decision to proceed.

2

Discussion Agenda

Overview of current retirement plans

Competitive prevalence and value among pharmaceutical companies

Recommendation to transition to new defined contribution Savings Plan in place of current defined benefit Pension Plan

Comparison of projected benefits - current Pension to new Savings Plan

20-year funding projection for new Savings Plan and current Pension Plan

3

Current Retirement Plans OverviewPension Plan (Defined Benefit) Provides benefit at retirement based upon formula linked to annual

compensation (i.e. not a final average pay based formula) 1.2% of annual compensation up to $31,200 1.5% of annual compensation above $31,200 to maximum of

$250,000 (IRS limitation) Maximum benefit accrued for each year of service is $3,656 per year

in retirement. This benefit may be paid as a lump-sum amount or one of several

forms of annuity payments.

401(k) Savings Plan (Defined Contribution) Provides opportunity for pre-tax savings

Up to 6% of compensation matched $0.50 per dollar saved The maximum Purdue paid amount for the year is $7,500 in 2012

Maximum employee directed savings of $17,000 per year Non-matched additional catch-up contribution of $5,500 allowed

for employees age 50 and above

4

Competitive Prevalence and Value

Using Aon Hewitt’s Benefit Index Survey, we compared Purdue’s overall retirement income benefits to plans offered by a broad range of 15 pharmaceutical companies.

14 of the other 15 companies offer one or more savings plans while only one company offers both an active pension plan and a savings plan.

Purdue’s retirement income value ranking is 10th of the 16 companies in this survey group.

Looking more broadly, this ranking is consistent with Purdue’s competitive position of overall benefit value when compared to the pharmaceutical industry norm.

5

Competitive Prevalence and Value

Company Company Matching Contributions to 401(k) Plan

Additional Retirement Program Type

Annual Value

Novartis Yes Defined Contribution $13,250

Alcon Yes Defined Contribution $12,000

Takeda Yes Defined Contribution $11,500

Eisai Yes Defined Contribution $11,000

Eli Lilly Yes Final average pay pension (DB) $10,800

Bristol-Myers Squibb Yes Defined Contribution $10,500

Mylan Labs Yes DC Profit Sharing $10,200

Amgen Yes Defined Contribution $10,000

Allergan Yes DC Profit Sharing $8,000

Purdue-Current Yes Career average pay pension (DB) $6,850

BiogenIdec Yes None $6,000

Genzyme Yes None $6,000

Gilead Sciences Yes None $5,000

Quintiles Yes None $4,500

Par Yes None $3,000

Valeant Yes None $3,000

Retirement Program Value Illustration – Employee with $100,000 compensation covered by retirement program• For all companies, “Annual Value” includes company paid 401(k) matching contributions

6

Purdue Proposed Defined Contribution Retirement Savings Plan

New Savings Plan Design for Included Current Employees & New Hires

Age + Service Employer Contributions - % of Eligible Compensation*

< 35 2.00%

35-44 3.00%

45-54 4.00%

55+ 5.00%

* Eligible Compensation is defined as base salary, bonus, overtime and shift premiums. The total amount is capped at $250,000 in 2012 and subject to increases in future years based on cost-of-living adjustments announced by the IRS.

8

Purdue Defined Contribution Retirement Savings Plan

Employee Group

Number of Current

Pension Plan Participants

Benefit as a % of Current Benefit for Current Employees

Under Age 45,Age 45-49 with age+service

<50

961 65%

Age 50 to 64,Age 45-49 with age+service

>=50825 100%

Projected benefit as a percent of Current Pension Benefit

Benefit for new hires is projected to be 40% to 65% of current pension value depending on number of years until retirement age

9

Purdue Defined Contribution Retirement Savings PlanEvaluation of RecommendationKey Points to Consider

Proposed program maintains value for those employees closest to retirement

Proposed program has lower value than current Pension Plan for nearly 54% of employee population and all new hires Further weakens competitive position of retirement program versus industry competitors;

Depending on age and service, benefit ranks 10th to 12th among 15 competitor programs Potentially reduced morale associated with loss of traditional pension plan Potentially need to periodically adjust DC Plan contribution levels for competitive reasons

Shift to lower cost program for employees under age 45 and new hires provides a lower cost program for Purdue Lower volatility of funding Less flexible funding for Defined Contribution population

For employees / new hires in Savings Program Greater employee understanding leads to greater employee appreciation Portability of benefits Shifts investment risk to Savings Plan participants who are responsible for investment

choice

12

Purdue Defined Contribution Retirement Savings PlanProposed Board Decision

Maintain current defined benefit pension for employees 45 or older whose age+service is at least 50.

Authorize the creation of a new defined contribution savings plan with 100% participation and 3 year vesting for current employees not maintained in Pension Plan and newly hired employees.

This proposal provides an overall projected funding level $85 million below expected level for current retirement benefits over the 20 year planning period. As pension program participation ends, program will have

a lower cost structure than current plan.

13

Compensation Summary on an Accruals Basis (Excludes Long Term Incentives)

All Employees (excludes Rhodes)

Year Net Sales Salaries ( 2 ) Bonus ( 1 ) Total Comp # of. Emps ( 3 )Average Salaries

Average Bonus

Average Total Comp ( E )

Total Comp as % of Sales

2012 Budget 2,351,541,000 212,662,856 60,295,431 272,958,287 1,730 122,927 34,853 157,779 11.61%2011 2,170,074,000 188,956,131 40,121,828 229,077,959 1,630 115,924 24,615 140,539 10.56%2010 2,378,210,000 168,655,501 62,934,691 231,590,192 1,463 115,281 43,018 158,298 9.74%2009 2,425,273,000 157,973,654 40,236,918 198,210,572 1,398 113,000 28,782 141,782 8.17%2008 2,099,561,000 154,134,564 25,737,391 179,871,955 1,301 118,474 19,783 138,257 8.57%

Sales Force (Reps, DMs, RMs, AEs, NAMs)

Year Net Sales Salaries Bonus 1 Total Comp # of. Emps ( 3 ) Average Salaries (A)

Average Bonus

Average Total Comp (B)


2012 Budget 2,351,541,000 55,362,150 29,589,000 84,951,150 595 93,046 49,729 142,775 3.61%2011 2,170,074,000 51,703,399 16,288,000 67,991,399 587 88,081 27,748 115,829 3.13%2010 2,378,210,000 42,222,268 24,257,000 66,479,268 484 87,236 50,118 137,354 2.80%2009 2,425,273,000 37,888,396 19,009,000 56,897,396 428 88,524 44,414 132,938 2.35%2008 2,099,561,000 31,958,952 14,499,000 46,457,952 355 90,025 40,842 130,867 2.21%

All employees (excluding Sales Force and VPs)

Year Net Sales Salaries Bonus 1 Total Comp # of. Emps ( 3 )Average

Salaries (C)Average

Bonus (C)Average Total

CompTotal Comp as

% of Sales2012 Budget 2,351,541,000 140,184,878 22,704,431 162,889,309 1,111 126,179 20,436 146,615 6.93%

2011 2,170,074,000 120,796,920 17,866,716 138,663,636 1,019 118,545 17,534 136,078 6.39%2010 2,378,210,000 110,914,722 22,512,362 133,427,084 955 116,141 23,573 139,714 5.61%2009 2,425,273,000 105,511,715 20,190,953 125,702,668 947 111,417 21,321 132,738 5.18%2008 2,099,561,000 108,176,122 18,694,577 126,870,699 921 117,455 20,298 137,753 6.04%

Officers / VPs

Year Net Sales Salaries Bonus 1 Total Comp # of. Emps ( 3 )Average Salaries

Average Bonus (D)

Average Total Comp


2012 Budget 2,351,541,000 17,115,828 8,002,000 25,117,828 24 713,160 333,417 1,046,576 1.07%2011 2,170,074,000 16,455,812 5,967,112 22,422,924 24 685,659 248,630 934,289 1.03%2010 2,378,210,000 15,518,511 7,539,333 23,057,844 25 620,740 301,573 922,314 0.97%2009 2,425,273,000 14,573,542 6,793,614 21,367,156 24 607,231 283,067 890,298 0.88%2008 2,099,561,000 13,999,489 6,749,892 20,749,381 25 559,980 269,996 829,975 0.99%

Notes(1) Includes annual bonus and Sales Bonus on an accruals basis to year earned. LTIP/LTRIP is not allocated back in this analysis.(2) Includes overtime, sick pay and excludes severance, car allowance, SSP match , 401k match, Pension or Medical benefits

Salaries for 2006 exclude indemnity payments to three former executives(3) Represents average in year and excludes Family, Interns, "Reimbursables", and Part-Timers(4) Cost of fringe benefits (pension, medical,dental,401(k),supplemental savings,etc. was $38,145 per person in 2011, and is not included above.

Observations:( A ) Average Sales Force salary has decreased as newer Reps. have shorter tenure.( B ) Average salary increase for incumbents is approximately 3% per year.( C) 2008 bonus was low due to change in payment date for exempt employees from December to following March.( D ) Bonus increase in 2010 due to the "kick-in" of long term ingredient in officer bonuses.

Page 1 of 3

(10) Key Assumptions in Driving Bonus Payout are as follows:

Payout Percentage Budget

Mid Year Update

June 2012Estimate

August 2012 Budget

Mid Year Update

June 2012Estimate

August 2012

Company Scorecard

Net Branded Revenues 20% 100% 78.7% 64.6% 20.0% 15.7% 12.9%Butrans Scripts 10% 100% 100% 80% 10.0% 10.0% 8.0%

Intermezzo Scripts 10% 100% 100% 0% 10.0% 10.0% 0.0%Operating Margin (a) 30% 100% 50.0% 50% 30.0% 15.0% 15.0% (a)R&D results 20% 100% 100% 100% 20.0% 20.0% 20.0%

LBD results 10% 100% 100% 100% 10.0% 10.0% 10.0%100% 100.0% 80.7% 65.9%

Compliance Multiplier 100% 100% 100% 100%

Scorecard Payout Level 100% 100% 80.7% 65.9%

% of Bonus driven by Corporate ScorecardPresident and VP Positions 75% 75% 75%

Other Exempt Positions 50% 50% 50%

Bonus Payout Reduction due to Scorecard MissPresident and VP Positions 0% 14.4% 25.6%Other Exempt Positions 0% 9.6% 17.0%

(a) Threshhold operating margin payout is $984.7 million. Below this amount payout will be 0% unless otherwise approved by Board. The August 2012 estimate reflects operating profit of $943 million. In the calculations above we have reflected a 50% payout but this would be subject to Board discretion. A payout of 0% on this component of the scorecard would reduce VP bonuses by $0.9 million and other exempt positions bonuses by $1.6 million.

% Attainment Payout Percentage

Page 3 of 3

Compensation Summary on an Accruals Basis (Excludes Long Term Incentives)

All Employees (excludes Rhodes)

Year Net Sales Salaries ( 2 ) Bonus ( 1 ) Total Comp # of. Emps ( 3 )Average Salaries

Average Bonus

Average Total Comp ( E )


2012 Budget 2,351,541,000 212,662,856 60,295,431 272,958,287 1,730 122,927 34,853 157,779 11.61%2011 2,170,074,000 188,956,131 40,121,828 229,077,959 1,630 115,924 24,615 140,539 10.56%2010 2,378,210,000 168,655,501 62,934,691 231,590,192 1,463 115,281 43,018 158,298 9.74%2009 2,425,273,000 157,973,654 40,236,918 198,210,572 1,398 113,000 28,782 141,782 8.17%2008 2,099,561,000 154,134,564 25,737,391 179,871,955 1,301 118,474 19,783 138,257 8.57%

Sales Force (Reps, DMs, RMs, AEs, NAMs)

Year Net Sales Salaries Bonus 1 Total Comp # of. Emps ( 3 ) Average Salaries (A)

Average Bonus

Average Total Comp (B)


2012 Budget 2,351,541,000 55,362,150 29,589,000 84,951,150 595 93,046 49,729 142,775 3.61%2011 2,170,074,000 51,703,399 16,288,000 67,991,399 587 88,081 27,748 115,829 3.13%2010 2,378,210,000 42,222,268 24,257,000 66,479,268 484 87,236 50,118 137,354 2.80%2009 2,425,273,000 37,888,396 19,009,000 56,897,396 428 88,524 44,414 132,938 2.35%2008 2,099,561,000 31,958,952 14,499,000 46,457,952 355 90,025 40,842 130,867 2.21%

All employees (excluding Sales Force and VPs)

Year Net Sales Salaries Bonus 1 Total Comp # of. Emps ( 3 )Average

Salaries (C)Average

Bonus (C)Average Total

CompTotal Comp as

% of Sales2012 Budget 2,351,541,000 140,184,878 22,704,431 162,889,309 1,111 126,179 20,436 146,615 6.93%

2011 2,170,074,000 120,796,920 17,866,716 138,663,636 1,019 118,545 17,534 136,078 6.39%2010 2,378,210,000 110,914,722 22,512,362 133,427,084 955 116,141 23,573 139,714 5.61%2009 2,425,273,000 105,511,715 20,190,953 125,702,668 947 111,417 21,321 132,738 5.18%2008 2,099,561,000 108,176,122 18,694,577 126,870,699 921 117,455 20,298 137,753 6.04%

Officers / VPs

Year Net Sales Salaries Bonus 1 Total Comp # of. Emps ( 3 )Average Salaries

Average Bonus (D)

Average Total Comp


2012 Budget 2,351,541,000 17,115,828 8,002,000 25,117,828 24 713,160 333,417 1,046,576 1.07%2011 2,170,074,000 16,455,812 5,967,112 22,422,924 24 685,659 248,630 934,289 1.03%2010 2,378,210,000 15,518,511 7,539,333 23,057,844 25 620,740 301,573 922,314 0.97%2009 2,425,273,000 14,573,542 6,793,614 21,367,156 24 607,231 283,067 890,298 0.88%2008 2,099,561,000 13,999,489 6,749,892 20,749,381 25 559,980 269,996 829,975 0.99%

Notes(1) Includes annual bonus and Sales Bonus on an accruals basis to year earned. LTIP/LTRIP is not allocated back in this analysis.(2) Includes overtime, sick pay and excludes severance, car allowance, SSP match , 401k match, Pension or Medical benefits

Salaries for 2006 exclude indemnity payments to three former executives(3) Represents average in year and excludes Family, Interns, "Reimbursables", and Part-Timers(4) Cost of fringe benefits (pension, medical,dental,401(k),supplemental savings,etc. was $38,145 per person in 2011, and is not included above.

Observations:( A ) Average Sales Force salary has decreased as newer Reps. have shorter tenure.( B ) Average salary increase for incumbents is approximately 3% per year.( C) 2008 bonus was low due to change in payment date for exempt employees from December to following March.( D ) Bonus increase in 2010 due to the "kick-in" of long term ingredient in officer bonuses.

Page 1 of 3

(10) Key Assumptions in Driving Bonus Payout are as follows:

Payout Percentage Budget

Mid Year Update

June 2012Estimate

August 2012 Budget

Mid Year Update

June 2012Estimate

August 2012

Company Scorecard

Net Branded Revenues 20% 100% 78.7% 64.6% 20.0% 15.7% 12.9%Butrans Scripts 10% 100% 100% 80% 10.0% 10.0% 8.0%

Intermezzo Scripts 10% 100% 100% 0% 10.0% 10.0% 0.0%Operating Margin (a) 30% 100% 50.0% 50% 30.0% 15.0% 15.0% (a)R&D results 20% 100% 100% 100% 20.0% 20.0% 20.0%

LBD results 10% 100% 100% 100% 10.0% 10.0% 10.0%100% 100.0% 80.7% 65.9%

Compliance Multiplier 100% 100% 100% 100%

Scorecard Payout Level 100% 100% 80.7% 65.9%

% of Bonus driven by Corporate ScorecardPresident and VP Positions 75% 75% 75%

Other Exempt Positions 50% 50% 50%

Bonus Payout Reduction due to Scorecard MissPresident and VP Positions 0% 14.4% 25.6%Other Exempt Positions 0% 9.6% 17.0%

(a) Threshhold operating margin payout is $984.7 million. Below this amount payout will be 0% unless otherwise approved by Board. The August 2012 estimate reflects operating profit of $943 million. In the calculations above we have reflected a 50% payout but this would be subject to Board discretion. A payout of 0% on this component of the scorecard would reduce VP bonuses by $0.9 million and other exempt positions bonuses by $1.6 million.

% Attainment Payout Percentage

Page 3 of 3

Contents1. Overview of 2012 and 20132. Marketing & Sales3. Technical Operations4. Research & Development5. Law6. Communication & External Affairs7. Licensing & Business Development8. Human Resources9. Finance10. Project Prioritization

Sales & MarketingOpioid Market Overview

Russ Gasdia

Extended-Release Opioid Competitive Landscape

2

Brand Name Chemical Name Company Brand Generic

Avinza® Morphine sulfate extended-release capsules Pfizer √

Butrans® Buprenorphine transdermal system Purdue √

Exalgo® Hydromorphone hydrochloride extended-release tablets Mallinckrodt √

Embeda® * Morphine sulfate and naltrexone extended-release capsules Pfizer √

Duragesic® Fentanyl transdermal system Janssen √ √

Kadian® Morphine sulfate extended-release capsules Actavis √ √

MS Contin® Morphine sulfate controlled-release tablets Purdue √ √

Nucynta® ER Tapentadol extended-release oral tablets Janssen √

Opana® ER Oxymorphone hydrochloride extended-release tablets Endo √ √**

OxyContin® Oxycodone hydrochloride controlled-release tablets Purdue √

Dolophine® Methadone hydrochloride tablets Roxane √ √

* Not currently available or marketed due to voluntary recall** Only 7.5 mg and 15 mg strengths

Annual Prescriptions and Dollars in Various Segments of the Analgesic Market(IMS MAT August 2012)

Dollars % Change TRxs % Change

Non-Opioid/Non-NSAID $3.9 Billion 7.6% 50.6 million 8.8%

Extended-Release Opioids $5.3 Billion -2.8% 26.2 million -0.1%

Immediate-Release SEOs $1.4 Billion -11.6% 23.8 million 10.8%

Combination Opioids $1.5 Billion 5.5% 189.9 million -2.5%

8

OxyContin® Tablets2013 Budget Presentation

2012 Year in Review

2012 gross sales LE of $2,774MM is even with 2011, but is $104MM, or 3.7%, below budget

2012 net sales LE of $2,018MM is $91MM, or 4.3%, below budget due to lower prescription demand, lower trade inventory, and higher returns than budgeted

Increased Sales Representative promotional activity Broadened “new” patient access to Patient Savings

Program Increased competitive products promotional activity (e.g.,

Nucynta® ER now promoting on Diabetic Peripheral Neuropathy)

14

2013 Key Initiatives

Sales Objective: Gross Sales of $2,916.5MM, an increase of

$142.7MM or 5.1%o Net sales of $2,147.4M, an increase of $129.9MM or 6%

Increase and Optimize S&P Sales Representative Activity Non-Sales Representative Promotion

Increase and Leverage the Leading Managed Care Status of OxyContin®

Managed Care Patient Savings Program

15

OxyContin® Maintains “Best in Class” Brand Formulary Coverage in Commercial and Med D

Source: Fingertip Formulary, 10/1/12

Commercial Tier 2 Coverage: 85.9% Lives: ~184MM

Tier 3 Coverage: 7.9% Lives: ~17MM

Medicare Part D Tier 2/3 Preferred Coverage: 56.8% Lives: ~17MM

Non-Preferred Coverage: 16% Lives: ~5MM

18

Medicaid On-Formulary Coverage: 3.1% Lives: ~1.5MM

Prior-Authorization Coverage: 97% Lives: ~47MM

worldwide sales report (us $'000)

Documents