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The generic industry has been under considerable pressure over the last several months due to increased competition and aggressive tactics by brand companies seeking to delay the introduction of generic products, and these new initiatives are designed to reduce our exposure to these trends.

This transaction builds upon that existing strategy to expand our brand and generic product offerings.

Watson is committed to working with the FDA to reach resolution of the issues raised in the letter in a prompt manner. While this is disappointing, we firmly believe that we can address the FDA's issues and gain approval of this product.

While the FDA seeks assurances that we will maintain and continue our quality commitment, we understand that the safety and quality of our products is not at issue.

We have taken significant steps to expand our product development and manufacturing capabilities in Asia, which will position us to maintain a competitive cost base while continuing to provide a broad portfolio of quality products to our customers.

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