Art Shannon – VP, IR and Communications Joe Papa – Chairman, President and CEO Judy Brown – EVP and CFO

Linda Bolton-Weiser – Caris & Company Frank Pinkerton – SunTrust Louise Chen – Colin Stewart David Buck – Buckingham Research Randall Stanicky – Goldman Sachs Derek Leckow – Barrington Research Stephen Pepper – Harrell Finance Elliot Wilbur – Needham & Company Jon Andersen – William Blair

Good morning. My name is Angie and I'll be your conference operator today. At this time, I would like to welcome everyone to the Perrigo fiscal year 2010 second quarter earnings results conference call. All lines have been placed on mute to prevent any background noise. (Operator instructions) I would now like to turn the conference over to Mr. Art Shannon. Please go ahead, sir.

Thank you very much, Angie. Welcome to Perrigo's second quarter 2010 earnings conference call. I hope you all had a chance to review our press release, which we issued earlier this morning. A copy is available on our website at www.perrigo.com. Also on our website is the slide presentation for this call. Before we proceed with the call, I'd like to remind everyone that the Safe Harbor language contained in today's press release also pertains to this conference call. Certain statements in this call are forward-looking statements within the meaning of Section 21E of the Securities and Exchange Act of 1934 as amended and are subject to the Safe Harbor created thereby. Please see the cautionary note regarding forward-looking statements on page one of the company's form 10-K for the year ended June 27, 2009. I would now like to turn the call over to Perrigo's Chairman and CEO, Joe Papa. Joe?

Thank you. Art and welcome everyone to Perrigo's second quarter fiscal 2010 earnings conference call. Joining me today is Judy Brown, Executive President and Chief Financial Officer. For our agenda today, I'll provide you a brief perspective on several highlights from the quarter. Then I'll talk about some of the tailwinds that we experienced again this quarter. Next, Judy will walk you through the detailed financials and our assumptions behind increasing our fiscal 2010 guidance to $2.55 to $2.65 adjusted earnings from continuing operations per share. Finally, I will give you an update on our new product portfolio and launches plus an update on our other business units. This will be followed by an opportunity for question-and-answer. Now, let's discuss the quarter. We had a great quarter. We continued to execute on our plan and focus on our five pillars of quality, customer service, new products, lowering our cost structure and people. We had record second quarter sales of $583 million, beating our expectations plus record adjusted income from continuing operations, which is up 56% from last year, on a 9% sales growth. On top of that, consolidated adjusted operating margin from continuing operations was a record 17%. And we had a strong performance from each of our three business units, while we generated $122 million in cash from operations in the quarter. To put that in perspective, just three years ago, our full-year cash flow from operations was $127 million and that was a record at that time. Our people – our Perrigo Operations team and supply chain continue to set production records in the quarter to meet customer demand and I'd like to thank all of the 7000-plus Perrigo employees around the world for their contributions to our great results for the quarter. By business segment, our Rx business unit had a very strong quarter in what continues to be a highly competitive environment. We grew Rx sales 38% while adjusted operating margin improved 1170 basis points without any major new product launches. Our over the counter prescription sales or ORx initiative, continues to grow. Perrigo is uniquely positioned to capture this sustainable opportunity. Our API segment continues to rebound, with new product sales and improved plant efficiencies, improving operating margins by 1240 basis points, though to be fair, it was a weak quarter last year. Great results, though, for our API team. Our Consumer Healthcare unit had record sales of $478 million in the second quarter. This was driven by increased store-brand penetration, continued growth in Miconazole sales without the presence of competition in Q2 and strong sales in our Cough Cold Flu category. Operating margins were a record 18.5 % in the quarter, up 500 basis points versus last year's adjusted operating margin. One of the drivers in this quarter was a strong start to the cough cold flu season. Our Cough Cold Flu sales category was up 19% versus last year in the quarter. During the quarter, the new product launch of our store brand version of Miralax performed very well. On slide three, you can see that of a five-player store-brand opportunity, Perrigo has the majority of customers and in just two months, our store-brand penetration reached 27%. While we gave some that back in January, we expect to reach our 30% store-brand penetration goal in the next few months. Brand sales for this product are approximately $220 million annually and growing 20% per year. Beyond strong execution of our plan, we benefited from this continuing market shift to quality, affordable, store-brand private label products. Looking at slide four, the overall OTC consumer market was up 1.5% versus last year. With national brands down 2%; but with store-brands gaining more than 12% on the strength of new product launches and the shift in retailer and consumer preference for store-brand in each major category. Please note that this data represents the last 52 weeks' activities. Looking to slide five, if you do the math for the 52 weeks ended June 2009, store-brand penetration increased approximately three points from 25% to 28%. If you do the same math for the 52 weeks ending January 2010, store-brands are still gaining share at nearly three percentage points a year. Although the trend has decelerated slightly, we expect this trend of increasing store-brand penetration to continue throughout calendar year 2010. I'm sure you have plenty of questions about our updated guidance, but first I'll turn the call over to Judy. Judy?

Thanks, Joe. Good morning, everyone. As you just heard from Joe, we've had another quarter of strong results. Our performance was driven not only by positive external factors, but also by our team's continued focus on driving internal improvements. During the next few minutes, I would like to provide a brief review of the fiscal second quarter results and following that discussion, I'll review where we stand today and our revised expectations for fiscal 2010. I would like to remind you again that my comments on the second results are based on continuing operations only and do not contain the results of our Israel Consumer Product business which were moved into a single line item, discontinued operations, on the face of the condensed consolidated statements of income for the periods presented Also on November 2, 2009, we announced the sale of our Israel Consumer Products business for approximately $55 million and we expect this transaction to close during our fiscal third quarter. This was an extremely strong quarter year-over-year. As you can see, on slide number six, the consolidated net sales from continuing operations increased 9% to a quarterly record $583 million, while consolidated GAAP gross profit grew 34%. Through execution across all businesses and improved leverage of operating expenses, we were able to grow consolidated GAAP operating income by 39% more than four times our top line growth. On slide seven, you'll see we've excluded two items from our analysis of the adjusted operating basis financials for the second quarter of fiscal 2010 and six items from fiscal second quarter 2009. You may review the reconciliation from the reported GAAP numbers to our adjusted non-GAAP numbers in the appendix to this presentation as well as to our press release. Now I'll take you through the rest of the financial analysis based on adjusted results for continuing operation. As you can see, on slide number eight, consolidated net sales growth from continuing operations was 9%, or $46 million, driven by a combination of strong sales volumes of existing products, new product sales and the inclusion of sales from the acquisitions of Unico and Diba in the Consumer Healthcare segment. This growth was partially offset by $4 million from our decision to exit certain product categories. Adjusted consolidated gross profit from continuing operations was up 31% from a year ago, driven by improved volume and product mix in Consumer Healthcare, Rx and API, new product sales in Consumer Healthcare, as well as the fact that we are seeing less pricing pressure in our Rx business. We again experienced a benefit Company-wide from our focus on execution and driving improved efficiencies in most of our manufacturing locations, with the most substantial improvement occurring in our API segment. Adjusted consolidated gross margin increased 590 basis points from this time last year, to 33.9%. Increased volume and operational execution, combined with the previously discussed improvements in gross profit, enabled us to translate the 9% top line expansion into a 53% improvement in adjusted consolidated operating income, compared to last year; and as you can see on the bottom of slide eight, our adjusted operating margin of 17% was an 490-basis-point increase from last year. Adjusted consolidated income from continuing operations was $65 million, up 56% from last year. Adjusted earnings per share from continuing operations were $0.70, up from $0.45 last year. Now, into the business segments. As you can see on slide nine, Consumer Healthcare second quarter net sales increased 7% to $478 million. Five of these percentage points came from new product sales, two came from existing product sales growth and approximately two came inorganically from the acquisitions of Unico and Diba. These increases were partially offset by approximately 1.5 percentage points from the exit of certain products and from unfavorable changes in foreign currency exchange rates. Adjusted gross profit was up $34 million from last year. The adjusted gross margin improvement of 530 basis points from last year was due to a combination of improved product mix, new product sales and pricing initiatives. Additionally, increased utilization in manufacturing and improved plant efficiencies helped further drive gross margin expansion. This improvement in gross margin over the quarter was slightly offset by the fact that we spent more on R&D project work and had higher SG&A expense related to variable incentive compensation linked to our strong operating performance. Even with this higher dollar spend in operating expenses in the quarter, however, in total we were able to expand the Consumer Healthcare adjusted operating margin 500 basis points to 18.5%. On slide 10, you can see that the Rx business has delivered another strong quarter year-over-year as well. The Rx team has performed very well in a dynamic sales environment, providing solid service that is enabling increased sales volumes. Second quarter net sales in Rx were approximately $56 million, up 38% compared to last year, driven by continued strength in our new over the counter Rx business, strong-based business performance and new product sales. Gross profit rose $10 million or 66%, from last year. Gross margin increased 800 basis points from last year to 46.8%. This significant improvement was due to a number of factors, including the fact that we are experiencing less pricing pressure in the market, are seeing positive product mix and are improving our operating efficiency. Adjusted operating income increased 129% over last year as a result of this increased operating expense leverage on top of the strong gross margin improvement. In total, adjusted operating margin improved 1170 basis points to a very strong 29.5%. Next, on to slide 11, the API segment. Execution continues to be a main component of the strength in API. Sales increased year-over-year by 16%. Through the focus on driving operating efficiencies, combined with improvements in existing product sales, the API team was able to expand gross margin 880 basis points to 39.9%. This, along with operating expense leverage, drove the increase of 1240 basis points you see at the bottom of slide 11. On slide 12, you'll see that although the sales in our Israel Pharmaceutical and Diagnostic business declined year-over-year, the team has improved the adjusted gross margin. A decrease on operating expense leverage resulted in an adjusted operating loss. Now some quick highlights on our balance sheet. Excluding cash and current investments, working capital from continuing operations was $325 million at the end of the quarter, down from $402 million at this time last year. Looking to slide 13, you can see that our working capital turns had increased 15% over the last three-year period. With the teams focused, inventory turns, day sales outstanding and days payables have all improved, even while we moved through a period that was absolutely without precedent operationally. Because of our strong income generation in these working capital improvements, cash provided by operations was $122 million in the second quarter compared with $35 million last year, a record for a fiscal second quarter. At the end of the second quarter, cash and current investment securities were $304 million, up from $162 million at the end of the second quarter fiscal 2009. Our total current and long-term debt on the face of the balance sheet was $843 million but included a $400 million back to back loan, which we always like to remind everyone, is completely offset by the $400 million restricted cash deposit in non-current assets. As of December 26, 2009, net of the back-to-back loan, our external debt was $443 million or 30.9% of total capital. Excluding cash, cash equivalence and current investment securities, our net external debt to total capital was down to 9.7%. This quarter, we also paid approximately $6 million in dividends or $0.0625 per share. Also during the quarter, we used approximately $46 million to repurchase 1.2 million shares of Perrigo stock per our 10b5-1 Plan. We completed our purchases under the current $150 million 10b5-1 Plan authorization on December 16, 2009. Now, I'd like to briefly update you on our outlook for the remainder of fiscal 2010. As a starting point, we can start with slide 14 to see where we are versus fiscal 2010 guidance we provided in November. As a data point, the original August guidance is also noted on the slide, below the respective metric. During the second quarter, our performance outpaced our revised guidance expectations. While external factors have provided certain tailwinds, the team's focus on customer service, operational efficiency improvements and increasing store-brand utilization are driving the overall performance. More importantly, we view many of these process improvements as sustainable. So as we look to the remainder of the year, our assumptions are based on the positive trends in our business, continued store-brand strength, contributions from our continuous operational improvement program, new product launches and strong customer service.With that said, let's move on to the revised expectations for fiscal 2010, which are on slide 15. Starting with the Consumer Healthcare segment, we continue to estimate year-over-year revenue growth of between 8% and 10%, but are now expecting full-year operating margins to expand to between 16% and 17% of net sales. This updated forecast includes our consideration of the presence of a new entrant in the Omeprazole market and our updated expectations for new product launches. We have also assumed, in our updated forecast, that there will not be a second peak to the 2009, 2010 cough cold flu season. Our Rx segment is operating in a favorable environment and the team has capitalized on this, not only gaining sales volume but also offering a level of customer service that will drive future business. In addition, our ORx business continues to grow. We are now targeting Rx year-over-year revenue growth of greater than 20% and estimating adjusted operating margin to be between 25.7% and 27.7% of net sales driven by product mix, operational improvements, less pricing pressure relative to earlier expectations and expense leverage. Our API segment is realizing the benefit of strong operating efficiency improvement and increased sales. We now estimate sales growth of 3% to 5% and an operating margin of between 15% and 17% of net sales. Please note that these estimations do not include any potential incremental contribution from sales of Temozolomide to Teva for marketing in the U.S. Tying together those new expectations and our position today, we are now estimating consolidated revenue growth of 8% to 11%. We are now expecting full-year adjusted consolidated gross margin to be between 32% and 33% of net sales. Also, during the second quarter, there was an increase of operating expenses from a particularly low level of spend in the fiscal first quarter. We continue to expect that fiscal 2010 distribution, selling, general and administrative expenses, as a percent of net sales, to approximately 12.7%, unchanged from previous guidance and last year. Additionally, there is no change to our R&D spending expectation, which remains at a target of 4% of net sales. So given the strong revenue growth and product mix, we expect adjusted consolidated operating margin to be between 15% and 17% of net sales. With the assumptions I just reviewed, we now expect full-year fiscal 2010 adjusted earnings per share from continuing operations to be between $2.55 and $2.65 per share, which is an increase of 36% to 42% from fiscal 2009 adjusted earnings per share from continued operations of $1.87. This assumes an effective worldwide tax rate for continuing operations of approximately 28%. Finally, looking at cash flow, I will remind you that operating cash flow is not linear in our business. While we had exceptionally strong cash flow in the first half of fiscal 2010 and particularly in the second quarter, we expect that it will normalize in the second half as the procurement to pay cycle and liabilities normalize. We now expect the performance of our businesses during fiscal 2010 to translate into cash flow from operations of between $270 million and $300 million for the full-year. The team has delivered another very strong quarter. We're now more focused than ever on leveraging this strength to drive continued growth in our business. With that, let me turn it back to Joe.

: We have had a great first half of the year. Record earnings in both quarters, along with market share gains in our entire portfolio gives me confidence that we will meet our revised forecast. We now expect to grow adjusted earnings per share from continuing operations 36% to 42% over last year's adjusted earnings per share from continuing operations. We have met with many investors over the past few months. We've heard some common concerns about our future growth. One of the concerns is Omeprazole. The question we often get is what happens to sales of Omeprazole with the launches of Prevacid and ZEGERID OTC? On slide 16, you can see the recent sales in the PPI category pre and post Prevacid's launch. It is early data; but on a unit sales basis, Prilosec OTC lost 6.5% of its sales, while our store-brand private label Omeprazole actually gained more than 2%. Why? We believe there is three reasons. First the PPI category is growing and replacing older antacid or H2 products. Second, PPI store-brand penetration continues to increase and third, the launch of a national brand switching from Rx will typically impact the higher-priced brand while the lower-priced private-label store brand is less likely to be affected. The other common question is how do you continue to grow Perrigo? As we continue to execute on our plan, some investors believe there has to be a trough in the future or at least difficult comparables. It's a great question. To me, the answer is new products and our model. The Rx and API businesses have strong new product pipelines in fiscal 2011 and 2012. The past years have been hard for these businesses because of a lack of new products. The Rx segment has been able to work through this difficult cycle, with better operational efficiencies and building the ORx category. In the API business segment there's an exciting new opportunity with the U.S. Temozolomide agreement with Teva. More on that in a minute. Our largest category, the OTC business, is fundamentally different from a typical generic model. First our product life cycle doesn't decline as dramatically as the generic prescriptions when faced with competition. Just look at the launch of Cetirizine. There were six approved ANDAs approved for Cetirizine OTC besides Perrigo and we were still able to achieve an 80 plus percent market share. We do more than just make the tablet. Few, if any, competitors can offer the promotional packages, the end-cap displays and the artwork, along with the marketing and distribution capabilities that Perrigo does. As you can see on slide 17, we expect the company's organic growth will continue. There are plans to bring more than 35 new products to market this fiscal year, adding more than $120 million in new product sales. I will not review all the products, but just highlight a few. We expect to bring our store-brand version of Mucinex to market after the court case is resolved and pending final FDA regulatory approval. We recently noted and agree with the FDA decision to decline the Reckitt Benckiser Mucinex Citizen's Petition. Brand sales for this product are approximately $180 million annually. Also the store-brand version of Monistat 1 is also expected to come to market this fiscal year. That product currently has $85 million in annual branded sales. These are just some of the new CHC products that are in or coming to market this year. The Rx and API business segments have strong new products coming to market this fiscal year, as well, with branded sales of over $80 million, not including the Temodar opportunity. On Temodar, you may have read last week, the court dismissed the Merck patent challenge on the generic version of Temodar. As the first company filed the ANDA that contained a paragraph for certification for Temodar, our partner, Teva, is eligible to receive a 180-day Hatch-Waxman statutory exclusivity to market this product in the U.S. Annual sales on the brand product were approximately $369 million in the United States based on IMS sales data. Perrigo has a supply agreement with Teva, previously it was BARR, for the active ingredient. Perrigo and Teva will share equally in the profitability on the U.S. sales of the product. It is unclear when Teva will launch the product, so earnings in this product are not included in the revised fiscal 2010 guidance Judy just outlined. Let me repeat, U.S. Temozolomide it is not included in today's guidance. We expect that fiscal 2011 will continue our growth. Planned OTC new products represent over $600 million in branded sales, plus other products that haven't been made public yet. Rx also has $600 million. API's nearly $400 million. We'll give you more detail on the products and timing of the launches at end of our fiscal fourth quarter, when we presently fiscal year 2011 guidance in August. In summary, we continue to execute on our plan. We continue to focus on our five pillars of quality, customer service, new products, low cost structure and our people. We believe our balance sheet is strong. We are generating strong cash flow. Our OTC business is the clear leader in the category. Our Rx business is beating our expectation and is positioned to continue to capture opportunities in the ORx business. Our API business is rebounding very well. We are optimistic and excited about our future. Perrigo is the right company at the right time in the right place to meet the world's growing need for quality, affordable healthcare products. Now let's take your questions. Operator, can you open up the line for questions, please.

Certainly. (Operator instructions) Your first question comes from the line of Linda Bolton-Weiser with Caris & Company. Linda Bolton-Weiser – Caris & Company: Hi. How are you?

Good morning, Linda. Linda Bolton-Weiser – Caris & Company: So, could you maybe, just on Omeprazole, it was interesting you said Omeprazole was growing at a 20% growth rate for you. Once you reach your target penetration, what do you think the growth rate does then? Do you think it decelerates a little bit and then can you comment on the ALLEGRA possible opportunity for FY 2011, just in general terms? And finally, can you just answer on Mucinex? I guess, why are you so sure about the exact timing of the litigation resolution and which quarter are you assuming that, that launches, in the fiscal third or fourth quarter?

Okay. A couple of different questions. Let me just start with one clarification. I said some things about Omeprazole. I don't believe I said the market is growing 20%. I don't think Judy did as well so. I did talk about the market for the Polyglycol or the MiraLAX growing by 20%, just to be clear, Linda. But just let me just talk about Omeprazole for a second. We are now in a spot where we are continuing, the store brand is continuing to take share. So if I could use the analogy of a pie, the slice of the pie for a store brand Omeprazole continues to get larger. At the same time, the pie is growing. It isn't growing 20% but there has been growth in the total units of Omeprazole Plus Prilosec brands and therefore, we are excited about what we think is still a very strong opportunity with Omeprazole. There is a competitor in the marketplace, I think as many people know but at this point, the competitor product is, we know clearly, they're in one retailer and in that particular retailer, they may be in a second one, but right now I know they're in one. And right now they are a line extension so that the retailer in question has the branded Prilosec, the store-brand Perrigo store- brand Omeprazole and they also have the competitor's Omeprazole capsule. That's what we know about Omeprazole at this time. I'll move to your second question on ALLEGRA. ALLEGRA is, we think an excellent product to go from prescription to OTC. We are preparing ourselves to be a player in that market and trying to work very diligently to be in the first wave of when the product goes from prescription to OTC. Everything we've heard from Sanofi in public documents suggests they're going to try the move expeditiously to move the product from a prescription to an OTC product, especially given their recent acquisition of the Chatham Product Company. So we're going to be prepared. We don't have a specific date at this time other than, say, our expectation is we will see it in the near future, which in our minds, is somewhere in that fiscal 2011 timeframe. Next point, I think your question was on Mucinex and what we target for Mucinex. We, to get Mucinex to market there were a number of hurdles we need to clear. First and foremost, we had to file the product that obviously occurred several years ago. Number two, we had to work through a Citizen's Petition. As you probably saw, the FDA recently denied the Reckitt Benckiser Citizen's Petition. We think that is appropriate. We agree with the FDA on that question. The final two steps though are we need to get FDA approval, our expectation that will occur in the next 30 to 60 days and then also the commentary that we need to work through the litigation. The litigation just as a reminder, the litigation is planned for March of 2010. It was pushed back approximately six weeks. Our expectation is that we have a number of decisions we will need to make in the next 30 to 90 days on, once our product is approved. Where do we go next with the question of the product and the situation that we'll face with Mucinex. I just simply want to remind you, one final comment is that with all of our products, we put them in a probability factor of waiting. So we don't put them in any specific quarter or timing that we have a plan, but probability weighs the number so that indeed it's not at a 100% probability and not at 0%. We always try to factor in, it's going launch exactly when is always hard to determine. So we put probability weighting on all of our products. Linda, I think I captured all of your questions, but if I didn't, just remind me of the ones I missed. Linda Bolton-Weiser – Caris & Company: No. I think you got it all. Thanks a lot, Joe. That's very helpful.

Thank you, Linda.

Your next question comes from the line of Frank Pinkerton with SunTrust. Frank Pinkerton – SunTrust: Great. Can you just speak to, I guess inventory in the channel and especially given the timing on the cough cold season this season this year versus some others? Was there buying in one quarter versus lowering of inventory in the channel in the next quarter?

Yeah. On balance, the inventory position, the summary comment inventory position versus a year ago is not dramatically different from the previous year. So that's the final comment. Is there switches that occur in any given quarter, yes, the answers is true to that. But on balance we're about where we were at the end of December 2008 and 2009 at the end time periods, approximately the same as the summary comment. The cough cold flu season of course, had an earlier start this year. And therefore, you see some product sales that occurred in our fiscal first quarter as people started to stock up at the end of September. But on balance, the summary question – the answer to your question is it's approximately the same as previous years. Frank Pinkerton – SunTrust: Okay. Great. I know you won't share specific language with result to contracts. Can you just give us overall, as an Omeprazole competitor comes, in does that necessarily change your pricing strategy with the product that you have out there or how would you expect your price to change going forward?

Yeah. Let me just try to give you the best answer I can on that question. We don't obviously, talk about any specific customer or any specific competitor. But what we have done obviously is we have known about this competitor coming into the market. I do just want to remind everybody that our product is a tablet, the brand is a tablet. The competitive product that you're referencing is a capsule. So there is a different in the product and that's why we've often talked about it being a line extension in entering the market. It's not going to – in most cases, we don't see it as replacing the product we see its being an additional line extension. Having said that though, we need to be relatively competitive on pricing of our product and therefore, we have worked with large customers on situations to ensure – the continued availability in their – on the shelf and we feel comfortable where we're at now. Have we had in some cases to look at pricing adjustment? The answer is yes. But I also want to say that we feel very comfortable that our product is a very good product and has been a very strong successful product for retailers. Frank Pinkerton – SunTrust: Okay. Great. And in the final questions, I saw on the press release to comment on relabeling some things for gluten-free. There's no charges or anything, these are new labels that will come out as old inventory goes to the shelf to be more friendly to consumers?

Absolutely correct, Frank. The gluten-free initiative is one we did base on extensive market research with retailers and consumers. And we found that gluten-free was an attribute that we can bring to the table. We did the research, looked at it and then came forward with new labeling to help the millions of people unfortunately, who have a problem with gluten, but there is going to be no destructions of labels, we're just going to be we're going to roll it in by customer, by product. Frank Pinkerton – SunTrust: Thank you.

Your next question comes from the line of Louise Chen with Collins Stewart. Louise Chen – Collins Stewart: Hi. I had several questions. I'll start with the first one. With respect to your TemodarR opportunity, can you help us understand the gross margin on that product and the tax rate, which I think are both probably more favorable than your – corporate average?

Hi, Louise. So we, as you know, don't talk about individual products and especially one where we are partnering with another company. So we're not going to spend any time on TemodarR specifically on gross margin or tax rate. I will say, just from a general directional comment that as a new product, gross margin on new products tend to be higher than the older products. So that's clearly one point and also from a tax rate point of view, I probably don't think I want to say much more than it will be lower than our corporate tax rate at this time. Judy, I don't know if there's anything future that you want to add.

That is precisely my answer, Joe. Perfect. Louise Chen – Collins Stewart: Okay. And the second question I had was – you had talked about adjacent opportunities in your OTC business. One thing that you've been talking about is your infant formula. Wondering if you can elaborate on the market size and then also, what kind of share you think can get and any timing around that type of an opportunity for you?

Yeah. Well, let's back up a bit. What we've always said is that we feel very good about our organic growth rate and as such, we feel that there is good organic growth rate in our business. However, we will look at adjacent product categories and geographic expanses as ways to grow the Perrigo business. On the adjacent product categories, we mentioned three areas that we thought were very important to us. Number one, we did mention infant nutrition. Number two, we mentioned what we called more diagnostics, store brand diagnostics that people used for home diagnostics. And number three, we mentioned Ophthalmics. Those are the three categories in which we think there are opportunities for Perrigo to continue to look at ROIC positive acquisitions in this category. Specific to the store brand infant nutrition, I don't have the exact number in front of me, but I think it's in the range of $5 billion of an opportunity for all infant nutrition. Obviously the store brand portion is a very small part of it at this time. Louise Chen – Collins Stewart: Okay. And the last question I had was on Aldara? Is that a product opportunity for you? And if so, it seems like a pretty exclusive opportunity in terms of filers. Do you have an update on the timing and where you are with that product?

Yeah. We haven't given out specifics on that. However, there was a Citizen's Petition that recently came out. The Citizen's Petition by Aldara, the owner of the Aldara brand, mentioned Perrigo and one other company in their filings. The Citizens Petition bottom line was denied by the FDA. So we feel that's a good opportunity. What we did put into our page 17 slide is we did put the Imiquimod cream, the Aldara product opportunity of $450 million as a fiscal year 2011 opportunity for us. Louise Chen – Collins Stewart: Thank you very much.

Thank you, Louise.

Your next question comes from the line of David Buck of Buckingham Research. David Buck – Buckingham Research: Yes. Thanks. A couple of questions. First on the guidance for 2010, can you talk about how you were able to reason with the pushback on Mucinex trial? And what the assumption is for the back half of the year of sustainability of some of the lumpier businesses, like the API business in particular? What's the assumption there? And then finally just on the – following-up on Aldara – with the Citizen Petition, do you think that could actually be something that moves forward into this year? And you talked a little bit about comps in the past and you had tough comps as a concern. What's ability of the confidence in the ability of the company to grow with double-digits in fiscal 2011? Thanks.

So great questions, David. I'm going to turn to Judy on the guidance question in terms of – my overall comment are going to be we had great this performance and we expect to continue to see good performance from the team. And therefore, it's going to will help us, but Judy will put a lot more color behind that comment. On the questions specific to Aldara though, in the fiscal 2010 versus fiscal 2011, I think that's a hard call. At this point, we put it in fiscal 2011 just based on what we know of the question that was raised on the Citizen Petition, the resolution of that citizen's petition. So at this point and I should have probably mentioned, we're only aware of ourselves and one other player in that market, at this time. At least based on the Citizens Petition, I don't have access to anyone else is because there's no paragraph for that was required to be filed with Aldara. So I don't have access anyone else to or knowledge of anyone else, in the product other than ourselves and one other player. But probably the most critical part of the question, Judy, I'll turn it back to you for relative to our guidance for 2010.

Sure. In terms of our confidence level or the assumptions we made as we looked at the second half of the year, as I commented earlier. The second half of the year forecast doesn't include a big second bump in the FY – or sorry. The 2009, 2010 cough cold flu season, but it does assume our product launches continue to Joe outlined, to get to that greater than $120 million of contribution from new products across all of our business units. So that's still fixed, as it was at the beginning of the year and we knew that our new product launches were going to be heavier weighted to the second half of the year, as those really got gearing in the third and fourth quarter. As we looked at to your point, you made the comment about the lumpiness in the business of API for example, API has a new product and dossier activity lined up for the second half of the year, even excluding the Temozolomide Teva U.S. launch or U.S. sales that Joe commented on. So the API business had a first half of the year strong execution, second half of the year geared toward new product launches. The story overall, as we looked at the second half of the year forecast, was one that was around execution. As I commented, there is less pricing pressure that we're seeing overall in the Rx market. We are seeing good response and uptake of our products in Consumer Healthcare with store brand penetration increasing. We are seeing very good operational efficiencies at our lean sigma programs, our procurement efficiencies are continuing to take hold. So it really is more of a broad executional story rather than one depending on one or two critical product launches as may have been in previous years. So we really are feeling that overall it's a very diversified, well grounded second half of the year forecast and obviously folks are going to watch closely what happens with critical new products in the pipelines that Joe discussed. But the gearing here is across the board, an improved forecast second half of the year for Rx, Consumer Healthcare and API. David Buck – Buckingham Research: And just to follow-up on the ability to sustain in double-digit growth. I know the three year figure is, I guess 11 to 16% EPS growth, what's the outlook for 2011, just conceptually?

Yeah. I think I'll start, David and then Judy, please add. We feel very good about the opportunity. What we've said in the past, just to remain everyone, is we expect to see top line growth with the 5 to 8% growth and the top line and double that or 10 to 16% earnings per share growth. Based on – as we go through our planning process and put together our models, we feel still very strong that's the kind of growth we expect from the business based on, A, new products and what we expect with new products, B, the operating efficiency that Judy just referenced and than also of course, our model. Our Consumer Healthcare model, we have a strong position in the Consumer Healthcare model. We expect to see that continue based on the performance and value that we are bringing to both the retailers and consumers. When – there's been a fundamental shift in consumer and retailer behavior. The fact that historically Perrigo has gained about one share point per year on average from say, 1990 to 2008 in terms of store brand, store brand has gained on average about one share point, more and more consumers, importantly more and more retailers, are positioning store brand private label as an important part of their equation. And therefore, we're seeing us gain somewhere north of two, three share points per year. That's a fundamental shift going on in the marketplace. We think it will be an important driver for our future. David Buck – Buckingham Research: Great. Thank you.

Your next question comes from the line of Randall Stanicky with Goldman Sachs. Randall Stanicky – Goldman Sachs: Great. Thanks, guys, for the questions. Just a couple of follow-ups. First on your generic – some of our – can you just – I want to ask you about the profitability, but can you talk about through the revenue recommendations? Do you get paid on the shipments or is it a profit split when the sales hit the channel?

Randall, that's an excellent question. The way our arrangement will eventually work is that because it is sharing of profitability, we will be dependent upon third-party sales from Teva in the U.S. They will have their third-party shipments. There will be a calculation based on to whom the shipments go and all of the required gross to net calculations that are inherent and required by U.S. accounting standards. At which point, we will be notified of the profitability on a quarterly basis. And we'll record our revenue at such time that we have notification of the full profitability of the product. So on an ongoing basis, this will be a pretty normal recurring process. But it should be noted that the first shipment of product from Teva eventually in the U.S. will not match the exact revenue recognition date for Perrigo. We will have a lag of anywhere between 45 and 100 days depending on the timing of launch and where it falls in the calendar quarter before we get our final calculation from Teva so we can appropriately record the revenue for U.S. GAAP. So just a heads-up, the date that Teva ships products will not be the exact same day we record our first $1 of revenue.

: Randall Stanicky – Goldman Sachs: That's helpful. In the U.S., in the case of a settlement that Teva enters into, that doesn't preclude you from getting paid given your agreement with Teva. Is that correct?

It is not our expectation there would be any settlement. However, if there is a settlement there because it's a partnership there is a value that would be shared by both parties. But that is not our expectation. Randall Stanicky – Goldman Sachs: Okay. Great. And, Judy, I want to ask you what the tax rate on the product is but your API is produced in Israel; is that correct?

That is correct. Randall Stanicky – Goldman Sachs: And then just my last question. Can you help us with the generic Rx business? The growth has been really strong. Is there two or three products that we should be focusing more on that you think you're seeing better pricing on with some sustainability that can help us directionally understand some of the growth sustainability in that business beyond what you have in terms of new products out there?

Randall, we don't talk about individual products but I do think, if you're looking for a place that really helps you understand, it is really ORx initiative is really the place to help you understand it and basically what it comes down to, in fiscal year 2008, the ORx category was essentially zero. By 2009 fiscal year, it grew to something like $25 million and by, the current timeframe, it's somewhere around a $40 million run rate or approximately a $40 million run rate and these are high-margin products. Basically what these are products that physicians continue to prescribe because patients need the products and we offer a store-brand version of them once they've moved from prescription to OTC status but there's still a demand for these products and these are often a lower-cost alternative for the patients. And therefore, we're really focusing on that ORx initiative and that's probably one of the most important drivers for the near-term and, we think, future success because there's no one who has a broader portfolio of products that are over the counter that were previously Rx and have moved over the counter for Perrigo and, therefore, we think we have a unique sustainable position in this ORx and why we're talking about it as such an important driver for us. Randall Stanicky – Goldman Sachs: And Joe, the gross margin on those products we should think as being higher than the overall Rx profitability?

I think, if you use it as approximately the Rx profitability, that's a good marker. In some cases they are. In some cases they're a little bit less. But just using that general Rx category is approximately correct. Randall Stanicky – Goldman Sachs: That's helpful. Thanks, guys.

Your next question comes from the line of Derek Leckow with Barrington Research. Derek Leckow – Barrington Research: Thank you. Good morning.

Good morning, Derek. Derek Leckow – Barrington Research: On the ORx category, staying with that for a minute, the $40 million run rate you talked about, that doesn't include the Pseudoephedrine product; is that right?

No. The Pseudoephedrine products would be included. I don't know the exact dollars of Pseudoephedrine that are in the ORx category but that would be a small, I understand your question. Let me back up. You're talking about the product we sell behind the counter? Derek Leckow – Barrington Research: That's correct.

No. That is not in there.

That's entirely Consumer Healthcare.

You are correct. Derek Leckow – Barrington Research: And then as it relates to some of the states that we were hearing about, talking about, perhaps banning the ORx sale of those products, moving back to, I guess, full prescription status, are you hearing any movement about that and are you concerned about that relative to that business?

Specifically the Pseudoephedrine you're asking me? Derek Leckow – Barrington Research: Yes.

This has been an ongoing question going back to 2004. There is going to be different states, different initiatives but we're not concerned in the sense, it's a great product. Unfortunately it's being misused by a handful of people but the Pseudoephedrine product is still a very good product and it really makes a difference for people who have need a decongestant product. So we're not hearing anything that's a significant change or shift. Certainly, as it would relate to the ORx, it's not a factor. Derek Leckow – Barrington Research: To just to clarify, if it were to move back to Rx status, would the product in the channel today just be moved simply to that level or would there be an inventory reduction period of time that would have to take place?

No. Our expectations, if it does happen, I don't expect it but if it did happen, I think there would be a gradual transition over time. It would go to an Rx status in three months out or six months out and the product that's in the channel today would be utilized as we would introduce new product that had the Rx-specific labeling. So I think, at this point, there's no major flags that say it's going to happen but our expectations would be a gradual process if, indeed, it did happen. Derek Leckow – Barrington Research: Just on the operating margin improvement in CHC, how big a factor was nutrition in this quarter, as a comparison and has that business reached its potential in terms of a margin rate?

Yes. It's a great question, Derek. We have tabled some of the important steps in our nutritional category to improve the margin and does it help our overall gross margin? The answer is absolutely correct. Albeit, just as a reminder, a year ago, we were on a pretty, we didn't give specific numbers on margins but they were not good. So it's got a pretty easy hurdle versus a year ago for us on the gross margin of nutritional products. Having said that, though, we did take some steps and we are on track with our nutritional gross margin project. Those steps that we have done is we've sought incremental suppliers of raw materials to lower our costs. We've added internal capacity to reduce the need for outsourcing of contract manufacturing of our products and finally we did remove or weed the garden, if I can use that expression, some of the products that were simply negative profitability. We've discontinued those products; and as a result of that, it's helped our gross margin and helped us to improve as per what we mentioned to you a year ago at this time, in terms of steps we would take to improve the overall profitability of our nutritional business.

And to just add a little color to that and linking back to David's question earlier is that nutrition is also executing against the plan that they laid out and are contributing to a portion of that increase from our November guidance. So they are also executing; and again last year's bar was relatively low but we are continuing to work and hope to improve that additionally next year in terms of operating margin contribution from the nutrition product category. Derek Leckow – Barrington Research: And are you anticipating a similar quarterly lumpiness in terms of orders from nutritional products or is that more of a smooth quarterly progression?

I think nutritional products have been pretty smooth. There's a little bit events that occur in the January timeframe as people start taking vitamin nutritional products. There's a little bit of a bump-up when the flu season hits, as people try to do everything to stay healthy. But I think, on balance, it's pretty consistent. Derek Leckow – Barrington Research: And finally could I just ask for an update on the international expansion?

Sure. Just as a quick reminder, everybody, we talked about adjacent product categories. The other opportunity we think for long-term growth is to take the Perrigo store-brand quality, affordable healthcare model to the rest of the world and we think there are opportunities in Europe, we think there's an opportunity in Asia, Latin America, South America and we are continuing to look for ROIC positive opportunities to expand our global quality, affordable healthcare concept. At this time we are talking to other potential partners and, or looking at opportunities to expand. But I really can't go into much more detail than that. Stay tuned. We'll have more to say in the future; but really for us, right now, it's just trying to find out where is the best place to go with this concept because we clearly believe that the world everywhere in the globe is facing this same issue of seeking greater accessibility to healthcare, greater demand for healthcare; but at the same point, the affordability of healthcare is an issue. So we think our concept of quality, affordable healthcare, especially in the Rx OTC category is an important one that we'll take global. Derek Leckow – Barrington Research: Thank you.

Your next question comes from the line of Steven Pepper with Harrell Finance. Stephen Pepper – Harrell Finance: All right. Good morning. I want to just take you to your 2011 fiscal year. Your plans for launching different products and I was looking at your presentation from the JP Morgan conference. I saw you knocked off Clarinex from your launch pad and you switched it with ALLEGRA, I would like to understand that issue. The way I understand things, ALLEGRA was not yet approved as OTC. Sanofi didn't go through the full process yet and so Sanofi may get three years exclusivity on this type of product. Where do things stand and why did you think ALLEGRA you'd be able to launch and maybe Clarinex not? And another question, why was an alley taken off the plan for 2011 and if you could elaborate on those things?

Sure. So let me start with Clarinex. Clarinex, we still think is an opportunity. We just tried to highlight ones that we thought are significant opportunities. Clarinex is still an opportunity. We do think though that the ALLEGRA is a slightly larger opportunity for us. There is no magic to say that one will happen, one will not happen for the first time. But Clarinex is still there. Just to be clear. It doesn't happen, though, until my recollection is that Clarinex is a June 2011 event, if I recall that correctly and therefore it is very late in our fiscal year, just as a reminder. I'm checking that date just as I continue. On the second part of the question, ALLEGRA, we do think that Sanofi will seek, June 2012 which is, is it June 2012? Stephen Pepper – Harrell Finance: That's when they end their three years on Clarinex.

I'm sorry. June 2012 is the date for, okay. So June 2012 is the date just for Clarinex to be clear. So, just as a reminder. I didn't want to confuse anyone. June 2012 is the date. So it's very late in our fiscal year 2012, not fiscal 2011, just as a reminder to everybody. So that stands as is, June 2012. No change in that. On the second part of the question, though, the effects of Fenadine ALLEGRA, where do we stand there? We know Sanofi has stated they seek to move ALLEGRA from prescription to an OTC status based on comments they've made in the public and we also know they acquired Chattam, which we think was part of their logic of acquiring Chattam was to have the OTC capabilities to launch the ALLEGRA product from a prescription and move it to OTC. Those there the facts that we know. The comment you asked was about the three-year exclusivity. The reason we think it is unlikely there will be a three-year exclusivity, I can't rule it out. The reason we think it is unlikely, is because Claritin has switched from a prescription of OTC and did not get a three-year exclusivity. ZYRTEC switched from an Rx to OTC, did not get a three-year exclusivity. Because what they usually use with antihistamine products was the existing data for products that have been approved as a prescription product and they just simply switched the category. It does not usually require incremental clinical trials to show that it is effective in that case. In the absence of no additional clinical trial requirements, it is unlikely that they will get three-year exclusivity based on the ZYRTEC precedent and also the Claritin precedent. I hope I explained that. Is that clear? Stephen Pepper – Harrell Finance: Very clear, yes.

And I think that was the last part of your question. Stephen Pepper – Harrell Finance: Yeah. Just about at the Alley.

Alley. Alley is still a very significant opportunity for us at this time. However, at this point, we just – based on where we are with the regulatory process, what we always do is put our products in as a weighted average or probability weighted and we feel, at this time, based on our input of where we are in process, we would take that off of the product category at this time. It's still a good market and we still look forward to it. But at this point, based on regulatory information, we said we'd take it off the list at this time. Stephen Pepper – Harrell Finance: Okay. Just one last question about your Rx business and the growth we've seen in the last two quarters. So you mentioned ORx business and I was wondering how much of this growth is also attributed to your royalties you've receiving on the Nasacort product. And then you’re receiving royalties based on your agreement? And is this contributing to the growth and to margins?

Absolutely. As we’ve noted last year, we expected the Triamcinolone approval and indeed that did occur and we are starting to recognize those royalty and service revenue as we've stated in our 10-Q. Those are noted in the Q and we expect that to continue until we ultimately launch a product and we’ll continue to get milestone payments. But thank you very much for the questions. Stephen Pepper – Harrell Finance: It’s okay. Thanks.

Your next question comes from the line of Elliot Wilbur with Needham & Company. Elliot Wilbur – Needham & Company: Thanks. Maybe just a couple of clean-up questions here. Joe, with respect to the Polyethylene Glycol launch, obviously very strong for you guys right out of the gate. I know there were multiple approvals initially. How many of those competitors have actually launched – you're actually facing in the channel at this point?

Yes. I think all of them have a product offering out there at this point. Just as a reminder, for Polyethylene Glycol, there were a total of five approvals that came to the market at the time for OTC approvals. They were previously Rx, the products that were approved and those products are still in the marketplace but from the OTC approvals there were five and we do face competitive pressure from them. However, at this time we're delighted to say we have over 90% of the share of the market. So total of five, they are out there to some degree. They may have some of the smaller customers but we think we have over 90% share. Elliot Wilbur – Needham & Company: Okay. And then last couple of quarters you talked or alluded to favorable pricing trends in the business. I'm just wondering is the dynamic there really just a deceleration in the overall erosion rate or you're actually in a position now where you actually may be able to take more tactical price increases on some of the product lines?

Yes. It's a great question, Elliot. I think probably the best way to answer is question is that we previously faced a rapidly accelerating pricing decrease. Now, what I say is we've flattened that out. In some cases, some isolated products, there may be opportunities for pricing increases. But I think from a modeling point of view, I would just use flat pricing in the Rx world. In some cases will we get price increase? The answer is yes but I don't want you to go too far with that pricing model. I think from a modeling viewpoint, if you hold the pricing flat at this point, I think would be the best way to model it. Elliot Wilbur – Needham & Company: Okay. Fair enough.

I think, probably – operator, we have time for one more question, please.

Certainly, your final question comes from the line of Jon Andersen with William Blair. Jon Andersen – William Blair: Good morning. Thanks for taking the question.

Hi, Jon. Jon Andersen – William Blair: I just wanted to see if you could add a little more color to what's happening in the channel, Joe. With the 300 basis point improvement in store-brand penetration in the past 52 weeks, are there some specific programs or activities that retailers are engaging in to drive that or is this a whole sales shift to consumer behavior? If you could characterize that for me a little bit. And then the second point is given the share gains are you seeing more price competition from the branded players or are price gaps holding overall between the brands and the private label?

So I think it's a good question. We have seen acceleration in the demand for store-brand private label products is absolutely clear. That's what's driving our 300 basis-point incremental gains. I think it's really – the summary is it's really both the consumer –cause of the economic conditions, the consumer finds themselves in, number one. But it's also the retailer, as they're trying to drive their profitability, recognizing the value of store brands. And I think the third point, which you didn't mention but I'll point to, is it's also companies like Perrigo, especially in OTCs bringing out the new products. It's all three of those important metrics is why we're gaining significant share. So for example, prior to that Omeprazole opportunity, there wasn't a chance to have a store-brand out there, now with our Omeprazole. It's moving a lot of business to private-label store brands, so that's part of the influence. But we're even seeing it in categories like analgesic, where there haven't been any significant new product entries. If you look at the analgesic market, store brands, on my slide four, store-brands are driving the market. The total market is up 1.1%, the national brands are down 1.4% and store brands are up 8.7% and I think that really reflects without the absence of any products, really the incremental desires by consumer, especially in the challenging economy we find ourselves in but more importantly, also the steps retailers are taking to give us more shelf space, put out more promotions to store-brand because it helps to drive their profitability. So I think it's a little bit of all of the above. It's the retailer, it is the consumer and importantly, it is what we're doing on new products. The final point I would make on it, as a reminder to everybody, the data that we have is once people make the move from the national brand to the store-brand product. Because it is the same product in terms of the active ingredient, gives you the same effectiveness as approved by the FDA. We're often finding that 91% of the time they stay with the store-brand product. I think that gives us a real strong foundation for the future and importantly, helps us feel very confident about where this business is going and why we're seeing the numbers we're seeing. Jon Andersen – William Blair: Thanks. That's helpful.

Well, everyone, I'd like to say thank you very much for your interest in Perrigo. And we will continue to execute on our plan and focus on our five pillars of making sure we have quality products, good customer service, new products, while keeping our low-cost structure and developing our people. And we look forward to talking to you again next quarter. Thank you very much for your interest in Perrigo. Have a great day.

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