`
`2=CAB %
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`A+=??E=JHA+MA=@+F=O+4AIA=H?D,ELEIE
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`,KC=I,6I=*=H?=OI+=FEJ=4AIA=H?D,ELEIE
`
`=E4K>E/@=5=?DI/HKF1?4AIA=H?D,ELEIE
`
`=H?0=H@/@=7*51LAIJAJ*=4AIA=H?D,ELEIE
`
`5A=KI.AH=@AAAHE5M=+4AIA=H?D,ELEIE
`
`,=LE@4EIECAHHC=5J=AO4AIA=H?D,ELEIE
`
`DJJFI IAAEC=FD=?=HJE?A%&" =AHC===CAAJ@EI?KIIAIG! !HAIKJIA=HECI?=JH=I?HEFJ F=HJ IECA
`
`MYLAN - EXHIBIT 1105
`Mylan Pharmaceuticals Inc. et al. v. Allergan, Inc.
`IPR2016-01127, -01128, -01129, -01130, -01131, & -01132
`
`
`
`)AHC===CAAJ,EI?KIIAI3! !4AIKJI-=HECI+=6H=I?HEFJ5AAEC)FD=
`
`2=CA B %
`
`/HACHO*/E>AHJ*B)AHHEO?D4AIA=H?D,ELEIE
`Gregory B. Gilbert - BofA Merrill Lynch, Research Division
`
`,=LE@9=HEI*+=FEJ==HAJI75
`David W. Maris - BMO Capital Markets US.
`
`,=LE@/*K?6DA*K?ECD=4AIA=H?D/HKF1?HFH=JA@
`David G. Buck - The Buckingham Research Group Incorporated
`
`E=L)>H=D=+EJECHKF1?4AIA=H?D,ELEIE
`Liav Abraham - Citigroup Inc, Research Division
`
`)=>A5=EO5JEBAE?=KI+1?4AIA=H?D,ELEIE
`Annabel Samimy - Stifel, Nicolaus & Co., Inc., Research Division
`
`8=E,EL=+H @EJ5KEIIA)/4AIA=H?D,ELEIE
`Vamil Divan - Credit Suisse AG, Research Division
`
`FAH=JH
`Operator
`
`0A=@MA?AJJDA)AHC=6DEH@3K=HJAH !-=HECI+=FAH=JH
`Hello, and welcome to the Allergan Third Quarter 2013 Earnings Call. [Operator
`1IJHK?JEI)JJDAHAGKAIJBJDA?F=OJ@=OI?BAHA?AEI>AECHA?H@A@1B
`Instructions] At the request of the company, today's conference is being recorded. If
`=OAD=I=O>A?JEIOK=O@EI?A?J=JJDEIJEA
`anyone has any objections, you may disconnect at this time.
`
`1MK@EAJEJH@K?AJ@=OI?BAHA?ADIJHE0E@=5AEH8E?A2HAIE@AJ
`Iwould like to introduce today's conference host, Mr. Jim Hindman, Senior Vice President,
`6HA=IKHO4EI=@1LAIJH4A=JEI5EHOK=O>ACE
`Treasury Risk and Investor Relations. Sir, you may begin.
`
`James M. Hindman
`=AI0E@=
`
`6D=I4A>A??=/@HEC9EJDABHJ@=OI?BAHA?A?=EI,=LE@2OJJ
`Thanks, Rebecca. Good morning. With me for today's conference call is David Pyott,
`+D=EH=BJDA*=H@=@+DEAB-NA?KJELABBE?AH ABB-@M=H@I-NA?KJELA8E?A
`Chairman of the Board and Chief Executive Officer; Jeff Edwards, Executive Vice
`2HAIE@AJ.E=?A=@*KIEAII,ALAFAJ+DEAB.E=?E=BBE?AH ,H5?JJ9DEJ?KF
`President, Finance and Business Development, Chief Financial Officer; Dr. Scott Whitcup,
`-NA?KJELA8E?A2HAIE@AJ4AIA=H?D=@,ALAFAJ+DEAB5?EAJEBE?BBE?AH =@E
`Executive Vice President, Research and Development, Chief Scientific Officer; and Jim
`*=HM5AEH8E?A2HAIE@AJ=@+HFH=JA+JHAH
`Barlow, Senior Vice President and Corporate Controller.
`
`*ABHAMALA=DA=@1MK@EAJHAE@OKJD=J?AHJ=EIJ=JAAJIJD=JMA=A
`Before we move ahead, I would like to remind you that certain statements that we'll make
`EJDEIFHAIAJ=JE=HABHM=H@ECIJ=JAAJI6DAIABHM=H@ECIJ=JAAJI
`in this presentation are fonivard-looking statements. These fonivard-looking statements
`HABA?J)AHC=IK@CAJ=@==OIEIO=IBJ@=O=@=?JK=HAIKJI=O@EBBAH
`reflect Allergan's judgment and analysis only as of today, and actual results may differ
`=JAHE=OBH?KHHAJANFA?J=JEI>=IA@=K>AHBB=?JHI=BBA?JEC)AHC=I
`materially from current expectations based on a number of factors affecting Allergan's
`>KIEAIIAI)??H@ECOOKIDK@JF=?AK@KAHAE=?AJDAIABHM=H@EC
`businesses. Accordingly, you should not place undue reliance on these fon/vard-looking
`IJ=JAAJI
`statements.
`
`DJJFI IAAEC=FD=?=HJE?A%&" =AHC===CAAJ@EI?KIIAIG! !HAIKJIA=HECI?=JH=I?HEFJ F=HJ IECA
`
`
`
`)AHC===CAAJ,EI?KIIAI3! !4AIKJI-=HECI+=6H=I?HEFJ5AAEC)FD=
`
`2=CA!B %
`
`.H=HAJDHKCD@EI?KIIEBJDAHEII=@K?AHJ=EJEAI=II?E=JA@MEJDJDABHM=H@
`For a more thorough discussion of the risks and uncertainties associated with the fon/vard-
`ECIJ=JAAJIJ>A=@AEJDEI?BAHA?A?==@MA>?=IJMAHABAHOKJJDA
`looking statements to be made in this conference call and webcast, we refer you to the
`@EI?=EAHHAC=H@ECBHM=H@ECIJ=JAAJIJD=JEIE?K@A@EKHJDEH@GK=HJAH !
`disclaimer regarding fon/vard-looking statements that is included in our third quarter 2013
`A=HECIHAA=IAMDE?DM=IBKHEIDA@JJDA5-+J@=O.H&=IMA=IKH
`earnings release, which was furnished to the SEC today on Form 8-K, as well as our
`BEECIMEJDJDA5-+HABAHA?A@EJD=J@EI?=EAH
`filings with the SEC referenced in that disclaimer.
`
`9AMEBMKFJDAGKAIJE=@=IMAHIAIIEBJDEI?=MEJD=IDHJEIJAO
`We will follow up the question-and-answer session of this call with a short listen-only
`IACAJMDAHAMAMEFHLE@A=@@EJE=EI?A=AKIEBH=JEJD=JHA=JAIJKH
`segment, where we will provide additional miscellaneous information that relates to our
`>KIEAII7@AH4ACK=JE.,EH@AHJ>A=>AJ@EI?KIIJDEIEBH=JEBHAAO
`business. Under Regulation FD,
`in order to be able to discuss this information freely
`@KHECJDAGK=HJAHMAKIJ>AIKHAJD=JEJEIEJDAFK>E?@=E
`during the quarter, we must be sure that it is in the public domain.
`
`6DEI?BAHA?A?==@=??F=OECMA>?=IJ=HA>AECIEKJ=AKIO>H=@?=IJLAH
`This conference call and accompanying webcast are being simultaneously broadcast over
`JDA1JAHAJMEJDHAF=OI=L=E=>ABHAMAA;K?==??AIIJDAEBH=JEKH
`the Internet, with replays available for one week. You can access the information on our
`MA>IEJA=JMMM=AHC=?
`website at wvwvallergancom.
`
`)JJDEIFEJ1MK@EAJJKHJDA?=LAHJ,=LE@2OJJ
`At this point, I would like to turn the call over to David Pyott.
`
`,=LE@-12OJJ
`David E. |. Pyott
`
`/HA=J6D=IE/@HEC=@EAI=@CAJAA6DEH@GK=HJAHI=AIE?HA=IA@
`Great. Thanks, Jim. Good morning, ladies and gentlemen. Third quarter sales increased
`IJHCOLAH3!B >O"J?=?KHHA?EAI=@>O 'J75@=HI9AHA
`strongly over Q3 of 2012 by 14.0% to local currencies and by 12.9% to US. dollars. We're
`@AECDJA@JD=JJDEIEIJDADECDAIJCHMJDH=JAMAD=LA@AELAHA@EJDAGK=HJAHIE?A &
`delighted that this is the highest growth rate we have delivered in the quarter since 2008,
`=@JD=JJDAANF=IEM=I>H=@>=IA@=?HII=OFH@K?JEAI=@>KIEAIIAI
`and that the expansion was broad-based across many product lines and businesses.
`
`.KHJDAHHAMAHA>AABEJECBHKHC>=HA=?DE=BKHFAH=JECHACEI=AO
`Furthermore, we're benefiting from our global reach in all of our operating regions, namely
`HJD)AHE?=-KHFA)BHE?=E@@A-=IJ=JE)AHE?==@)IE=2=?EBE?=?DEALA@=J
`North America, Europe, Africa, Middle East. Latin America and Asia Pacific achieved at
`A=IJ@K>A@ECEJCHMJDE?=?KHHA?EAIEJDAGK=HJAH6DEIEIHABA?JELABJDAIJHC
`least double-digit growth in local currencies in the quarter. This is reflective of the strong
`CHMJD>AECANFAHEA?A@EKHFH@K?J=HAJI=@ECAAH=B)AHC=I=HAJ
`growth being experienced in our product markets, and in general, of Allergan's market
`ID=HAC=EI=IMAEJH@K?AJDAIJA=@OIJHA=BAMEL=JELAFH@K?JIJKH
`share gains as we introduce the steady stream of new innovative products to our
`?KIJAHI=HK@JDAMH@
`customers around the world.
`
`4AC=H@ECFAH=JECFAHBH=?AMACAAH=JA@/))2@EKJA@A=HECIFAHID=HAB
`Regarding operating performance, we generated non-GAAP diluted earnings per share of
` !=E?HA=IAB&LAH3!B =@MA=>LAJDAKJFHLE@A@JDA
`$1.23, an increase of 18% over Q3 of 2012, and well above the outlook provided on the
`=IJ?=B&J JD=IJJDAH>KIJI=AI6DEIHAIKJM=I=?DEALA@=BJAHMA
`last call of $1.18 to $1.20, thanks to the robust sales. This result was achieved after we
`?JEKA@JELAIJ>JDEJJ=HCAJA@I=AI=@=HAJECFHCH=IJ=K?DFH@K?JI
`continued to invest both into targeted sales and marketing programs to launch products
`=@>KE@KH=HAJI=IMA=IEJ4,
`and build our markets, as well as into R&D.
`
`DJJFI IAAEC=FD=?=HJE?A%&" =AHC===CAAJ@EI?KIIAIG! !HAIKJIA=HECI?=JH=I?HEFJ F=HJ IECA
`
`
`
`)AHC===CAAJ,EI?KIIAI3! !4AIKJI-=HECI+=6H=I?HEFJ5AAEC)FD=
`
`2=CA"B %
`
`4AC=H@ECFHCHAIIMEJDKHFEFAEAMAHAFA=IA@JD=JMAHA@AELAHECIJBJDA
`Regarding progress with our pipeline, we're pleased that we're delivering most of the
`=HHACK=JHO=FFHL=IMAHAIAAECBHJDEIOA=H5E?AJDA=IJA=HECI?=MAD=LA
`major regulatory approvals we're seeing for this year. Since the last earnings call, we have
`HA?AELA@.,)=FFHL=IBH87)=@*6:BH?HMIBAAJEAI=IMA=IJDABEHIJ
`received FDA approvals for VOLUMA and BOTOX for crow's feet lines, as well as the first
`FIEJELAFEEBHJDA.HA?D=CA?OBH?HMIBAAJEAI=HECJDABEHIJIJAFEJDA
`positive opinion from the French agency for crow's feet lines, marking the first step in the
`KJK=HA?CEJEFH?A@KHAMDE?DIDK@A=@J=FFHL=IBHJDEIE@E?=JE=?HIIJDA
`mutual recognition procedure, which should lead to approvals for this indication across the
` %?KJHEAIEJDA-KHFA=7E=IMA=IHM=O=@1?A=@
`27 countries in the European Union, as well as Non/vay and Iceland.
`
`.KHJDAHHAMAIA?KHA@=FFHL=IBH*6:BHLAH=?JELA>=@@AHE+==@=JDA7
`Furthermore, we secured approvals for BOTOX for overactive bladder in Canada, the UK.
`=@=FIEJELAFEEE.H=?A)IJDA=F=AIA=KJDHEJEAI=FFHLA@KH=JHAA
`and a positive opinion in France. Also, the Japanese authorities approved our Natrelle
`>HA=IJEF=JFH@K?JIE?K@ECJDAHK@IBJ?DAIELAEA JDAIJOA"ID=FA@
`breast implant products, including the round, soft cohesive line; the style 410 shaped
`==JE?=EA =IMA=IJDAJEIIKAANF=@AHH=CA)IIK?D)AHC=EIJDAO
`anatomical line; as well as the tissue expander range. As such, Allergan is the only
`?F=OJD=LAHACK=JHO=FFHL=BH>JD>HA=IJ=KCAJ=JE=@HA?IJHK?JEE
`company to have regulatory approval for both breast augmentation and reconstruction in
`=F=9AANFA?JJIA?KHAHAE>KHIAAJBHHA?IJHK?JEFIJ=IJA?JO=HK@
`Japan. We expect to secure reimbursement for reconstruction post mastectomy around
`JDAA@BJDAOA=H
`the end of the year.
`
`KHC>=F=HJAHIDEFMEJDA@OJNAN?K@ECHA=EI=HABA?JEBKHCJAH
`Our global partnership with Medytox, excluding Korea, is a reflection of our long-term
`ABBHJIJ?JEKAJ>KE@JDAB=?E==AIJDAJE?IEJDAH=FAKJE?=HAJIBH
`efforts to continue to build the facial aesthetics in therapeutic markets for
`AKH@K=JHI=@IDK@HAIKJEKIBBAHEC=ANF=@A@IKEJAIBFH@K?JI
`neuromodulators, and should result in us offering an expanded suites of products,
`E?K@EC=FJAJE=EGKE@FHAIAJ=JE6DAA@OJNJH=I=?JEEI?JECAJKF
`including a potential liquid presentation. The Medytox transaction is contingent upon
`HA?AELEC?AHJ=ECLAHAJ=FFHL=I
`receiving certain government approvals.
`
`4AC=H@EC-8),-:EJDA75MAHAJH=?BHBEEC>OOA=HA@=JDA@=J=HAGKEHA@
`Regarding LEVADEX in the US, we're on track for filing by year end, all the data required
`>O.,)EEJI?FAJAHAIFIAAJJAH=@=JE?EF=JA=FFHL=E3 B "4AC=H@EC
`by FDA in its complete response letter, and anticipate approval in Q2 of 2014. Regarding
`JDA@EIFI=BJDA>AIEJO1JAHLAJE>KIEAIIMAHAFA=IA@JD=JMAD=LAAJAHA@EJ
`the disposal of the Obesity Intervention business, we're pleased that we have entered into
`=@ABEEJELA=CHAAAJMEJD)F-@IKHCAHO=@ANFA?JJ?IAJDAJH=I=?JE>ABHA
`a definitive agreement with Apollo Endosurgery and expect to close the transaction before
`OA=HA@
`year end.
`
`4AC=H@EC4-56)515=@.,)I@H=BJCKE@=?AECAAHE?IB?O?IFHEAMAHA
`Regarding RESTASIS and FDA's draft guidance in generics of cyclosporine, we're
`A?KH=CA@JD=J A@E?=I?EAJEAIF=JEAJCHKFI=@?IKAHCHKFIIK>EJJA@
`encouraged that 22 medical societies, patient groups and consumer groups submitted
`?AJI=H=EIEC??AHI=>KJFK>E?DA=JD=@F=JEAJI=BAJOEBCAAHE?IMAHAJ
`comments, all raising concerns about public health and patient safety if generics were to
`>A=FFHLA@B)AHC=I?FANE=@M=JAHAKIE1JEIJAMHJDOJD=JJA
`be approved of Allergan's complex oil and water emulsion. It is noteworthy that not one
`IECAIK>EIIEM=I=@AEB=LHBJDA@H=BJCKE@=?A.,)IBBE?E=IALAMEJDEJDA
`single submission was made in favor of the draft guidance. FDA's officials, even within the
`CAAHE?I@ELEIED=LA=@EJJA@=IHA?AJO=IKA !JD=JAGKEL=AJIBFDJD=E?
`generics division, have admitted as recently as June 2013 that equivalents of ophthalmic
`@HKCIEI=AAHCECJFE?>AEC?IE@AHA@BH.,)IHACK=JHOI?EA?AAD=?AAJ
`drugs is "an emerging topic" being considered for FDA's regulatory science enhancement
`EEJE=JELA
`initiative.
`
`DJJFI IAAEC=FD=?=HJE?A%&" =AHC===CAAJ@EI?KIIAIG! !HAIKJIA=HECI?=JH=I?HEFJ F=HJ IECA
`
`
`
`)AHC===CAAJ,EI?KIIAI3! !4AIKJI-=HECI+=6H=I?HEFJ5AAEC)FD=
`
`2=CA#B %
`
`)AHC=D=IIK>EJJA@IJK@EAIBIALAH=JAIJAKIEIIDMECJD=JJDAIAAKIEI
`Allergan has submitted studies of several test emulsions showing that these emulsions
`JD=JAAJJDA@H=BJCKE@AEAIAJDAAIIIECEBE?=JO@EBBAHBH4-56)515*=IA@
`that meet the draft guidelines nonetheless significantly differ from RESTASIS. Based on
`KHELAIJEC=JEI.,)D=IALAHEJDAF=IJ=FFHLA@=FDJD=E?AKIE>=IA@
`our investigations, FDA has never, in the past, approved an ophthalmic emulsion based
`IAOELEJH@=J=1JDA?ECJDIJDA@H=BJCKE@=?AD=IJDADECDAIJ
`solely on in vitro data. In the coming months, the draft guidance has the highest
`==CAAJ=JJAJE=@MAMEJ=AALAHO=FFHFHE=JAAC==@HACK=JHO=?JEJ
`management attention, and we will take every appropriate legal and regulatory action to
`KFD@IK@I?EA?A=@F=JEAJI=BAJO
`uphold sound science and patient safety.
`
`M?AJECJDAFAHBH=?ABJDA>KIEAIIAI1?A?AMEJDFDJD=E?
`Now commenting the performance of the businesses. l'll commence with ophthalmic
`FD=H=?AKJE?=I)AHC=I=AIE?HA=IA@E3!>O'E?=?KHHA?EAIMEJDE@
`pharmaceuticals. Allergan sales increased in Q3 by 9.0% in local currencies with mid-
`IECA@ECEJCHMJDEJDA75>AEC>IJA@>OIJHC@K>A@ECEJCHMJDEJAH=JE=O
`single-digit growth in the US. being boosted by strong double-digit growth internationally.
`4-56)515MEJD CHMJDE?=?KHHA?EAI?JEKAIJCHMLAHOIJHCOJO
`RESTASIS with 21% growth in local currencies continues to grow very strongly, not only
`EL=KA>KJ=IELKACELAC@HAIFIAJKHE?HA=IA@ELAIJAJE@EHA?JJ
`in value, but also in volume, given good response to our increased investment in direct-to-
`?IKAH=@LAHJEIECEJDA75=@=ANF=@EC>=IABFHAI?HE>AHIE75FJAJHO
`consumer advertising in the US. and an expanding base of prescribers in US. optometry.
`1=@@EJE4-56)515EICHMECIJHCOE+==@==@6KHAOEF=HJE?K=H
`In addition, RESTASIS is growing strongly in Canada and Turkey in particular.
`
`1JDAC=K?=?=JACHOMAHAANFAHEA?EC=@EBBE?KJ=HAJEJDA75=@M3!
`In the glaucoma category, we're experiencing a difficult market in the US, and low Q3
`CHMJDBH71/)CELAJDAEF=?JBCAAHE?IB=HF=JAJANFEHA@FH@K?JI
`growth for LUMIGAN given the impact of generics of major patent expired products.
`-N75MAAOA@IJHC@K>A@ECEJCHMJDBH>JDJDA>E=JFHIJ=@>HEE@EA
`Ex-U.S., we enjoyed strong double-digit growth for both the bimatoprost and brimonidine
`BH=?DEIAIEJDAGK=HJAH=@=HAFA=IA@JD=JFAH15@=J=BH3 JD=JIJDA=IJFAHE@
`franchises in the quarter, and are pleased that per IMS data for Q2, that's the last period
`BHMDE?D@=J=EI=L=E=>AJDA71/)>A?=AJDAIAECC=K?=FH@K?JEJDA
`for which data is available, the LUMIGAN became the #1 selling glaucoma product in the
`MH@
`world.
`
`1-KHFAMA=K?DA@/).46KEJ@IAE5AFJA>AHEJJDAFHAIAHL=JELABHAA
`In Europe, we launched GANFORT unit dose in September into the preservative-free
`?=JACHOEJDABEHIJM=LAB?KJHEAI=AOE/AH=OJDAAJDAH=@I=@JDA7
`category in the first wave of countries, namely in Germany, the Netherlands and the U.K.,
`=@@ECJJDA=K?DAIB71/)KEJ@IAA=HEAHEJDAOA=H1JDA75MAHA
`adding to the launches of LUMIGAN unit dose earlier in the year. In the US, we're
`A?KH=CA@JD=J "71/)BHK=HO?LAH=CAE2=HJ,=@E?AH?E=F=I
`encouraged that 2014 LUMIGAN formulary coverage in Part D and in commercial plans
`ME>A>H=@OIEE=HJJDAIEJK=JEE !)@MJD=JMAD=LA?LAHJA@=BJDA
`will be broadly similar to the situation in 2013. And now that we have converted all of the
`FHAI?HEFJEILAHJJDAEFHLA@71/)FH@K?JJD=JMA?=??AJH=JA=
`prescriptions over to the improved LUMIGAN 0.01% product, that we can concentrate all
`KHABBHJIJCHMECJDA>H=@=C=E
`our efforts onto growing the brand again.
`
`4AC=H@ECJDAMH@FDJD=E?=HAJFAH15BH3 15IDMIBEHIJD=BBJDAOA=H
`Regarding the world ophthalmic market per IMS for Q2, IMS shows first half of the year
`CHMJDBJDA=HAJ=J=H>KIJ >IJA@>O &CHMJDEHAJE=JDAH=FAKJE?I=@
`growth of the market at a robust 12%, boosted by 28% growth in retinal therapeutics and
`)AHC=CHMECA@=HAJ=J.HC=K?=15HAFHJIMH@=HAJCHMJD=J
`Allergan growing end market at 11%. For glaucoma, IMS reports world market growth at
`O!BHJDABEHIJD=BCELAJDA75IEJK=JEMEJD)AHC=MH@ME@ACHMJD=J=
`only 3% for the first half, given the US. situation, with Allergan worldwide growth at a
`DA=JDO
`healthy 10%.
`
`DJJFI IAAEC=FD=?=HJE?A%&" =AHC===CAAJ@EI?KIIAIG! !HAIKJIA=HECI?=JH=I?HEFJ F=HJ IECA
`
`
`
`)AHC===CAAJ,EI?KIIAI3! !4AIKJI-=HECI+=6H=I?HEFJ5AAEC)FD=
`
`2=CA$B %
`
`4AC=H@ECJDA71/)BH=?DEIA15HAFHJI71/)=@/).46CHMEC
`Regarding the LUMIGAN franchise, IMS reports LUMIGAN and GANFORT growing
`@K>A@ECEJIE-KHFA)BHE?=E@@A-=IJ=JE)AHE?=+==@==@)IE=2=?EBE?=I
`double digits in Europe, Africa, Middle East, Latin America, Canada and Asia Pacific, as
`MA=IE=F=>O)AHC=I?=F=HJAH5AK=@=IKJFAHBHECJDACHMJDB
`well as in Japan by Allergan's local partner, Senju, and also outperforming the growth of
`JDA6H=L=J=BH=?DEIAEA=?DBJDAIACACH=FDEAI/ECBHM=H@MAANFA?JJ>AABEJ
`the Travatan franchise in each of these geographies. Going fon/vard, we expect to benefit
`BHAH?I@AAFD=IEIBFDJD=COMH@ME@A
`from Merck's deemphasis of ophthalmology worldwide.
`
`.HJDA=HJEBE?E=JA=HI?=JACHO15BHJDABEHIJD=BIDMI=MH@=HAJCHMJDB$
`For the artificial tears category, IMS, for the first half, shows a world market growth of 6%
`MEJD)AHC=K@AHFAHBHECMEJDOCHMJDCELAKHFHEHEJO4-56)515
`with Allergan underperforming with only 1% growth, given our priority on RESTASIS
`MDAHAEJEI=L=E=>A/HMJDEIDMALAHFE?ECKFBHJDAEJH@K?JEB2618-
`where it is available. Growth is, however, picking up from the introduction of OPTIVE
`)@L=?A@I@=I2618-2KI=@FKIKEJ@IAE-KHFAMDE?DM=IHA?AJO
`Advanced, sold as OPTIVE Plus and plus unit dose in Europe, which was recently
`=FFHLA@EANE?+DEA=@6KHAO15AFJA>AHMA=I=K?DA@=AN?EJECAM
`approved in Mexico, Chile and Turkey. In September, we also launched an exciting new
`FH@K?J2618-.KIEFD=>HA=JDHKCD?>E=JEB ABBA?JELAFOAHI
`product, OPTIVE Fusion [ph], a breakthrough combination of 2 effective polymers,
`DO=KHE?=?E@=@?=H>NOAJDO?AKIAE1J=O5F=E2HJKC==@*ACEK=@
`hyaluronic acid and carboxy methylcellulose, in Italy, Spain, Portugal and Belgium, and
`MAHJDEIFH@K?JKJ=?HIIJDAMH@KJIE@AJDA75
`we'll roll this product out across the world outside the US.
`
`1JDA75DO=KHE?=?E@EIJCH=FDA@=I=6+ECHA@EAJBHFDJD=E?
`In the US, hyaluronic acid is not monographed as an OTC ingredient for ophthalmic
`FD=H=?AKJE?=I6DEIEI)AHC=IBEHIJAJHOEJJDADO=KHE?=?E@FAAHIACAJMDE?D
`pharmaceuticals. This is Allergan's first entry into the hyaluronic acid peer segment, which
`E-KHFA=??KJIBH=>KJ BJDALAH==HAJ
`in Europe accounts for about 20% of the overall market.
`
`2618-.KIEME=@@HAIIJDA=GKAKI@ABE?EAJIACAJJDA@HOAOA=HAJMDEA
`OPTIVE Fusion will address the aqueous deficient segment, the dry eye market, while
`2618-2KIBBAHIHAEABJJDAEFE@ABBE?EAJ@HOAOAIKBBAHAH
`OPTIVE Plus offers relief to the lipid efficient dry eye sufferer.
`
`74,-:CHMJD?JEKAI=ID=HFJH=A?JHO@HELAF=HJE?K=HO>O-KHFA=@JDA
`OZU RDEX growth continues on a sharp trajectory driven particularly by Europe and the
`759AHA?AJOHA?AELA@HAE>KHIAAJFHE?ECE*H=E
`US. We recently received reimbursement pricing in Brazil.
`
`LECJ*6:I=AIE3!E?HA=IA@>O!'J?=?KHHA?EAIEEAMEJD
`Moving on to BOTOX, sales in Q3 increased by 13.9% to local currencies, in line with
`OA=HJ@=JA?=?KHHA?OCHMJDB!$MEJDOA=HJ@=JA@K>A@ECEJCHMJDE>JD
`year-to-date local currency growth of 13.6%, with year-to-date double-digit growth in both
`JDA=AIJDAJE?=@JDAH=FAKJE?BH=?DEIAI
`the aesthetic and therapeutic franchises.
`
`4AC=H@ECJDAC>==HAJKFJ3 JDA=IJFAHE@BHMDE?D@=J=EI=L=E=>AMA
`Regarding the global market up to Q2, the last period for which data is available, we
`AIJE=JABEHIJD=BBJDAOA=HCHMJD=J"MEJD)AHC==ICHMEC=J")AHC=
`estimate first half of the year growth at 14%, with Allergan also growing at 14%. Allergan
`D=IC=EA@IAID=HAEJDAH=FAKJE?I=IMAAIJ=>EIDA@JDAAM?=JACHEAIB+DHE?
`has gained some share in therapeutics as we established the new categories of Chronic
`ECH=EAEAKHCOBBIAJ>OIAEHID=HAIIE=AIJDAJE?I=IAMFH@K?JI
`Migraine in neurology, offset by some minor share loss in aesthetics as new products
`AJAHJDA=HAJ=HK@JDAMH@
`enter the market around the world.
`
`DJJFI IAAEC=FD=?=HJE?A%&" =AHC===CAAJ@EI?KIIAIG! !HAIKJIA=HECI?=JH=I?HEFJ F=HJ IECA
`
`
`
`)AHC===CAAJ,EI?KIIAI3! !4AIKJI-=HECI+=6H=I?HEFJ5AAEC)FD=
`
`2=CA%B %
`
`5E?AJDA=IJA=HECI?=MAHA?AELA@IALAH==H*6:FH@K?J=FFHL=IIA
`Since the last earnings call, we received several major BOTOX product approvals, some
`HABAHA?A@A=HOEO?AJI>KJE=@@EJE*6:M=I=FFHLA@BH+DHE?
`referenced early in my comments, but in addition, BOTOX was approved for Chronic
`ECH=EAEHM=OBHAKHCAE?>=@@AHE6=EM==@BHLAH=?JELA>=@@AHEHA=
`Migraine in Non/vay, for neurogenic bladder in Taiwan and for overactive bladder in Korea,
`4KIIE=JDA+A?D4AFK>E?=@3=J=H
`Russia, the Czech Republic and Qatar.
`
`1JDA75JDAJDAH=FAKJE?>KIEAII?JEKAIJCHMIJHCO@HELA>O+DHE?
`In the US, the therapeutic business continues to grow strongly, driven by Chronic
`ECH=EAJDA >=@@AHE@E?=JEI=@=E?HA=IA@CHMJDEAKHHAD=>EEJ=JEJDA
`Migraine, the 2 bladder indications and an increased growth in neuro rehabilitation, the
`=JJAH>AABEJECBH=I=AIBH?AANF=IEMAANA?KJA@=JJDAA@B =@=I
`latter benefiting from a sales force expansion we executed at the end of 2012, and also
`@KAJJDA@MIEECB1FIAI?AH?E=FHAIA?AEJDA75EJDAIFHEC
`due to the downsizing of lpsen's commercial presence in the US. in the spring.
`
`4AC=H@EC+DHE?ECH=EAMAAOA@>H=@=??AIIMEJD'!B?AH?E=EAI=@
`Regarding Chronic Migraine, we enjoyed broad access with 93% of commercial lines and
`BA@E?=HAEAID=LECFE?O?LAH=CA=@=HA?JEKECJEFHLAHAIKJIE
`100% of Medicare lines having policy coverage and are continuing to improve results in
`JDAFHEH=KJDHE=JEFH?AIIJ@HELA@M@AE=H=JAI
`the prior authorization process to drive down denial rates.
`
`9AD=LA=IJA=@OBMBAMEA?JHIJH=EA@=@=@FJEC*6:EJJDAEHFH=?JE?AI
`We have a steady flow of new injectors trained and adopting BOTOX into their practices
`=@?JEKECDECDALAIBFH@K?JI=JEIB=?JE>JD>OF=JEAJI=@JDAEH@?JHI)@
`and continuing high levels of product satisfaction, both by patients and their doctors. And
`AFD=IEIEIMEIDAFDAH@ECF=JEAJIJDHKCDJDAEHBEHIJOA=HBJHA=JAJDAFECJ
`emphasis is now in shepherding patients through their first year of treatment, helping to
`AIKHAF=JEAJI>A?AO=HAFA=JKIAHI=@=IE@A?HA=IECJDAEJAHL=>AJMAA
`ensure patients become loyal repeat users, and also in decreasing the interval between
`EA?JEI?IAHJJDA=>AA@E@E?=JEBALAHO!JDI1H@AHJBKHJDAH>KE@JDEI
`injections closer to the labeled indication of every 3 months. In order to further build this
`=HAJMAD=LAELAIJA@DA=LEOEJ>H=@A@68=@LAHJEIECIE?AKOJE?HA=IA
`market, we have invested heavily into branded TV advertising since July to increase
`F=JEAJ=M=HAAII=@JA?KH=CAF=JEAJIJBE@=JH=EA@IFA?E=EIJ
`patient awareness and to encourage patients to find a trained specialist.
`
`AJHE?IHAC=H@EC=M=HAAIIMA>IEJALEIEJI=@@?JHIA=H?DAI=HA=JHA@EC
`Metrics regarding awareness, website visits and doctor searches are all trending
`FIEJELAO
`positively.
`
`4AC=H@ECKHCOI=AI=HA=ALAIJHCAHKFIMECJD=E+DHE?ECH=EA=>AEJ
`Regarding urology, sales are on an even stronger upswing than in Chronic Migraine, albeit
`BB=I=AH>=IA4AC=H@ECHAE>KHIAAJMAHA=>AJIA?KHA?LAH=CAEIA
`off a smaller base. Regarding reimbursement, we're able to secure coverage in some
`=H?AH?E=F=IE5AFJA>AHMEJDM%'B=?AH?E=EAIAOEC
`major commercial plans in September, with now 79% of all commercial lines enjoying
`FE?O?LAH=CA& BA@E?=HAEAID=LA?LAH=CA
`policy coverage. 82% of Medicare lines have coverage.
`
`LAH!KHCEIJI=HAHACK=HEA?JHIKJB=LAH=KELAHIAB=KHCEIJI=JKIJ
`Over 3,000 urologists are regular injectors out of an overall universe of all urologists atjust
`LAH=OBMDE?DB?KHIA@J=@@HAIIE?JEA?A7HCOA?CEIJJDA
`over 10,000, many of which, of course, do not address incontinence. Urogynecologist, the
`IK>IFA?E=JOB?KIA@BA=AE?JEA?AEI=CHKFF=HJE?K=HOB?KIECJDEI
`subspecialty focused on female incontinence, is a group particularly focusing on this
`JHA=JAJFJE
`treatment option.
`
`DJJFI IAAEC=FD=?=HJE?A%&" =AHC===CAAJ@EI?KIIAIG! !HAIKJIA=HECI?=JH=I?HEFJ F=HJ IECA
`
`
`
`)AHC===CAAJ,EI?KIIAI3! !4AIKJI-=HECI+=6H=I?HEFJ5AAEC)FD=
`
`2=CA&B %
`
`2HAF=HECBHBKHJDAH=HCHMJDE "MAHA?KHHAJO@AAFAECKHCACH=FDE?
`Preparing for further major growth in 2014, we're currently deepening our geographic
`HA=?D>O=@@EC=@AIJK>AHBBEA@HAFHAIAJ=JELAIEJDA7EJA@5J=JAI1-KHFA
`reach by adding a modest number of field representatives in the United States. In Europe
`=@JDA?KJHEAIMDAHAMAD=LAIA?KHA@HAE>KHIAAJMAHAI=JEIBEA@MEJDJDAEEJE=
`and the countries where we have secured reimbursement, we're satisfied with the initial
`@A=@BH*6:BH+DHE?ECH=EA=@BH>=@@AH=IMA=IMEJDKH?JEKEC
`demand for BOTOX for Chronic Migraine and for bladder, as well as with our continuing
`CHMJDEJDA>=IALAAJ@EIH@AHI?=JACHEAI
`growth in the base movement disorders categories.
`
`6KHECJJDA=AIJDAJE?IE@ABJDA*6:BH=?DEIAMAAOA@IJHCCHMJDE3!E
`Turning to the aesthetic side of the BOTOX franchise, we enjoyed strong growth in Q3 in
`IJBJDAFHE?EF==HAJIBJDAMH@MEJDO=BAMAN?AFJEIMDAHAJDAHA=HA
`most of the principal markets of the world, with only a few exceptions where there are
`?FAJEJELAFH@K?JI>AECEJH@K?A@IK?D=IEIJDA?=IAE+==@=)KIJH=E=HA=
`competitive products being introduced, such as is the case in Canada, Australia, Korea
`=@ANE?9AHAAOECLAHOIJHCA@=HAJCHMJDE4KIIE==F=+DE=IJ
`and Mexico. We're enjoying very strong end market growth in Russia, Japan, China, most
`?KJHEAIEJDA-=IJ=@5KJD)IE==@*H=E
`countries in the East and South Asia and Brazil.
`
`1JDA75>=IA@IKHLAO@=J==HAJCHMJDE3!D=I=??AAH=JA@JJDAM@K>A
`In the US, based on survey data, market growth in Q3 has accelerated to the low double
`@ECEJI.KHJDAHHAEJEIA?KH=CECJD=J*6:+IAJE?E5AFJA>AHAOA@&
`digits. Furthermore, it is encouraging that BOTOX Cosmetic in September enjoyed 82%
`ID=HA=@AN=?JOJDAI=A=IE5AFJA>AHB MEJD:AEID=HA=J#=@JDA
`share and exactly the same as in September of 2012, with Xeomin share at 5% and the
`OA=HLAHOA=HC=E?EC=JJDAANFAIABJDEIGK=HJAH
`year-over-year gain coming at the expense of this quarter.
`
`19AIJAH-KHFAMAAIJE=JAJD=JJDA=HAJE3!EICHMECE@JDECDIECA@ECEJI
`In Western Europe, we estimate that the market in Q3 is growing mid to high single digits
`=@JD=JMAHA?KHHAJOD@ECID=HA
`and that we're currently holding share.
`
`.=?E==AIJDAJE?IE3!CHAMIJHCO=J !OA=HLAHOA=HE?=?KHHA?EAIEEA
`Facial aesthetics in Q3 grew strongly at 21.3% year-over-year in local currencies, in line
`MEJDOA=HJ@=JACHMJDMEJD=HACEIBJDAMH@HACEIJAHECIJHCCHMJDALAIB
`with year-to-date growth, with all regions of the world registering strong growth levels. Of
`?KHIAJDA=HAJEIFEIA@BH=BKHJDAHIJHCKFIMECMEJDJDAHA?AJ.,)=FFHL=BH
`course, the market is poised for a further strong upswing with the recent FDA approval for
`87)=@JDAEJH@K?JEBKH>O?HA@EJ?IJJA?DCOE?K@EC8*-)=@
`VOLUMA and the introduction of our by-credit cost technology, including VOLBELLA and
`81.6J=HAJI=HK@JDAMH@8*-)M=I=K?DA@E)KIJH=E==@HA=E
`VOLIFT, to markets around the world. VOLBELLA was launched in Australia and Korea in
`5AFJA>AH81.6E)KIJH=E=1JDA75MAHAH=FE@OHC=EECJH=EECIAIIEIBH
`September, VOLIFT in Australia. In the US, we're rapidly organizing training sessions for
`87)BHKH?KIJAHIBHE@LA>AH=BJAHMDE?DMAMEIDEFFH@K?J6DEIEI
`VOLUMA for our customers from mid-November, after which we will ship product. This is
`=JE?EF=JA@=J??KH=HK@