March 2010
Allergan
A Specialist in the Biopharmaceutical
& Medical Device Industries
2
® & ™ Marks owned by Allergan, Inc.
JUVEDERM® is a registered trademark of Allergan Industrie SAS
Imitrex STATdose Syste...
3
Allergan: Specialized and Diversified
• Focused on six medical specialties
• Depth of physician relationships
• Leading ...
4
Global Leader in Selected Medical Specialties
Yellow-shaded sections represent areas of interest for licensing and acqui...
0% 20% 40% 60% 80% 100%
Allergan
J&J
Other
0% 20% 40% 60% 80% 100%
BOTOX®
Dysport
Xeomin
Other
0% 20% 40% 60% 80% 100%
Men...
6
Allergan
J&J
Galderma
GSK/Stiefel
Bayer
Sanofi-Aventis
ScheringPlough
Nycomed
Novartis
Graceway
MAT Q4-08 US$ Sales at A...
Broad Product Portfolio
Estimated Peak Potential
Diversified
7
<$200 $200-500 $500-1,000 >$1B
ACUVAIL®
ACZONE®
SANCTURA XR...
8
Business Segments
~72% Reimbursed vs. ~28% Cash Pay
FY 2009
$4.4 Billion
+3%
Urologics
2%
Skin Care
3%
BOTOX® Therapeuti...
2008 2009 2010
U.S. • ACZONE®
• LATISSE®
• TRIVARIS™
• ACUVAIL®
• OZURDEX™ RVO
• BOTOX® Chronic Migraine*
• BOTOX® Spastic...
Growth
2009
Track Record of Creating Markets
First 5 years of revenue growth
BOTOX® Cosmetic RESTASIS®
LATISSE®
$0
$100
$2...
Track Record of Creating Markets
Accelerated Sales Post Acquisition by Allergan
Facial Aesthetics Breast Aesthetics
Obesit...
12
DTC - Spending Into Recovery
LATISSE® JUVÉDERM®
Growth
13
RESTASIS® LAP-BAND®
DTC - Spending Into RecoveryGrowth
Allergan DTC Spending
Investing In Growth & Innovation
AdvertisingExpense($M)
Source: Allergan SEC filings. Expenditures n...
Retina: $2,023 0%+26%
15
Worldwide Ophthalmics: High Market Shares in
Fastest Growing Market Segments
Source: IMS Global
*...
16
YTD 2009 world market growth 8%
Allergan #2 market share position in 2008*
Allergan #2 in Glaucoma 2008**
* Source: Oph...
17
• Therapeutic expected to re-accelerate with
anticipated approvals
– Spasticity, Chronic Migraine, and OAB
BOTOX® Growt...
18*Source: Allergan Market Estimates Top 5 European Markets (France, Germany, Italy, Spain, UK)
Allergan
Competition
BOTOX...
$0
$200
$400
$600
$800
$1,000
$1,200
$1,400
$1,600
2002 2003 2004 2005 2006 2007 2008 YTD
Q3‘ 09
19
Allergan:
• Successful...
LATISSE® Sales
Strategic Fit With Medical Aesthetics Franchise
Global Market Peak Sales Could Exceed $500MM
Growth
20
$0
$...
10.0%
12.0%
14.0%
16.0%
18.0%
20.0%
-
$100
$200
$300
$400
$500
$600
$700
$800
1998 1999 2000 2001 2002 2003 2004 2005 2006...
22
OZURDEX™
(dexamethasone intravitreal implant 0.7mg)
 Retina Market Size:$2.1B*
 5 Year CAGR: 42%
 Current Treatment ...
23
Potential Future Catalysts for
BOTOX® Therapeutic
1 Scher AI, Stewart WF, Liberman J, Lipton RB. Prevalence of frequent...
Product Indication Ph I Ph II Ph III Filed
Expected
Approval
LUMIGAN®
0.01% Glaucoma
● ● ● ● ● 2010
OZURDEX™ Uveitis
● ● ●...
Product Indication Ph I Ph II Ph III Filed
Expected
Approval
BOTOX®
OAB (Neurogenic)
● ● ● ● 2011
BOTOX®
OAB (Idiopathic)
...
26
Patent Protection Product AGN Strategy
2009 ALPHAGAN® P 0.15% ALPHAGAN® P 0.15% Royalty
ALPHAGAN® P 0.1%
COMBIGAN®
2009...
27
Allergan
Staying Power
 Track record of investing to create markets with favorable global
mega-trends
 Multiple growt...
28
Reconciliation of Selected Non-GAAP Financial
Measures
“GAAP” refers to financial information presented in accordance w...
29
Reconciliation of Selected Non-GAAP Financial Measures
Adjustments to GAAP research and development expense used to cal...
March 2010
Allergan
A Specialist in the Biopharmaceutical
& Medical Device Industries
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  1. 1. March 2010 Allergan A Specialist in the Biopharmaceutical & Medical Device Industries
  2. 2. 2 ® & ™ Marks owned by Allergan, Inc. JUVEDERM® is a registered trademark of Allergan Industrie SAS Imitrex STATdose System®, Amerge®, Restylane®, Radiesse®, Dysport®, Xeomin®, Macugen®, Visudyne®, Avastin ® and Lucentis® are registered trademarks of their respective companies Forward-looking Statements This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding product development, market potential, expected growth, efficiencies, and Allergan's expected, estimated or anticipated future results, including Allergan’s earnings per share and revenue forecasts, among other statements. All forward-looking statements herein reflect Allergan’s current analysis of existing trends and information and represent Allergan’s judgment only as of the date of this presentation. Allergan’s performance may differ materially from its estimates and targets. Therefore, you are cautioned not to rely on any of these forward-looking statements and Allergan expressly disclaims any intent or obligation to update these forward-looking statements except as required to do so by law. Actual results may differ materially from Allergan’s current expectations based on a number of factors affecting Allergan’s businesses, including, among other things, the following: changing competitive, market and regulatory conditions; the timing and uncertainty of the results of both the research and development and regulatory processes; domestic and foreign health care and cost containment reforms; technological advances and patents obtained by competitors; the performance of new products, including obtaining government approval and consumer and physician acceptance, and the continuing acceptance of currently marketed products; the effectiveness of promotional and advertising campaigns; the potential for negative publicity concerning any of Allergan’s products and it’s adverse effects; the timely and successful implementation of strategic initiatives; the results of any pending or future litigations, investigations or claims; the uncertainty associated with the identification of, and successful consummation and execution of, external corporate development initiatives and strategic partnering transactions; and Allergan’s ability to obtain and successfully maintain a sufficient supply of products to meet market demand in a timely manner. In addition, matters generally affecting the economy, such as changes in interest and currency exchange rates, international relations, and the state of the economy worldwide, may materially affect Allergan’s results. These and other risks and uncertainties affecting Allergan’s businesses and operations may be found in Allergan’s most recently filed Form 10-K and any subsequent Form 10-Q under the heading “Risk Factors”. These filings, as well as Allergan's other filings with the U.S. Securities and Exchange Commission (SEC), can be obtained without charge at the SEC's web site at www.sec.gov. These SEC filings are also available at Allergan’s web site at www.allergan.com along with copies of Allergan’s press releases and additional information about Allergan. For further information, you can contact the Allergan Investor Relations Department by calling 714-246-4636. © 2010 Allergan, Inc. All rights reserved.
  3. 3. 3 Allergan: Specialized and Diversified • Focused on six medical specialties • Depth of physician relationships • Leading market share positions • Limited number of competitors Specialized • Broad portfolio of products • Cash pay vs. reimbursed markets • Worldwide geographic presence – Emerging markets Diversified • Track record of creating markets – BOTOX® Cosmetic – RESTASIS® – LATISSE® • Leader in Medical Aesthetics & Ophthalmology Growth
  4. 4. 4 Global Leader in Selected Medical Specialties Yellow-shaded sections represent areas of interest for licensing and acquisitions • Broad portfolio of products • Follow R&D technologies into specialties • Build presence within specialties organically and through acquisitions Ophthalmology Glaucoma - LUMIGAN® - ALPHAGAN® - GANFORT™ - COMBIGAN® - IOP lowering - EP Agonist - Sus. Release Retina - OZURDEX™ - TRIVARIS™ - NOVADUR™ (Brimonidine) - TKI Urologics BPH - BOTOX® Obesity - LAP-BAND® - ORBERA™ - EASYBAND™ Neurosciences BOTOX® Therapeutic - Spasticity, CD, Chronic Migraine, JCP, etc. GSK Co-promote − Imitrex® − Amerge® Medical Dermatology TAZORAC® Topical - Cream - Gel ACZONE® - Topical Acne BOTOX® - Hyperhidrosis * Plastic surgery & dermatology OAB - SANCTURA XR® - BOTOX® Dry Eye - RESTASIS® - REFRESH® - OPTIVE™ Ocular Surface Disease - ACUVAIL® - ZYMAR® Medical Aesthetics * Physician Dispensed Creams - M.D. FORTE® - PREVAGE® MD - VIVITÉ® Breast Aesthetics Dermal Fillers - JUVÉDERM® - VOLUMA™ BOTOX® COSMETIC LATISSE® - Eyelash Growth Targeted BOTOX® (Next Generation) - Pain Bladder Cancer - Apaziquone (EOQUIN®) Specialized
  5. 5. 0% 20% 40% 60% 80% 100% Allergan J&J Other 0% 20% 40% 60% 80% 100% BOTOX® Dysport Xeomin Other 0% 20% 40% 60% 80% 100% Mentor / J&J Allergan Other 0% 20% 40% 60% 80% 100% Pfizer GSK Novartis Allergan Other 0% 20% 40% 60% 80% 100% Restylane (Medicis / QMed) JUVÉDERM®(Allergan) Radiesse (BioForm) Other 0% 20% 40% 60% 80% 100% Alcon Allergan Pfizer Other 5 Global Market Leadership Positions Most Markets With Limited Number of Competitors Ophthalmology Neuromodulator Dermal Facial Filler Breast Aesthetics Gastric Banding U.S. Urology AGN Market Position #2 #1 #2 #2 #1 #4 MAT Q3 2009. Sources: Ophthalmics – IMS Global (49 countries) at Q3-09 constant exchange rates + actual US retina sales data. OAB – SDI (VONA) and Mail Order at ex-factory price levels. Neuromodulator/Filler/Breast/Banding – Internal estimates. Mixture of Public Information (Earnings Releases, 10Ks, 10Qs), D&B, AGN Internal Data, Syndicated Marketing Research Reports, Analyst Reports, Internet Searches, Competitive Intelligence, etc. Specialized
  6. 6. 6 Allergan J&J Galderma GSK/Stiefel Bayer Sanofi-Aventis ScheringPlough Nycomed Novartis Graceway MAT Q4-08 US$ Sales at Actual Rates Included Businesses: Breast Aesthetics, Botulinum Toxins (Cosmetic), Dermal Facial Fillers, Health / Obesity (bands and balloons) and Skin Care Sources: Internal estimates / various sources; Skin Care – IMS D Class (15 countries) (proxy for Dermatology) A Global Leader in Medical Dermatology and Medical Aesthetics 0 200 400 600 800 1,000 Sales($MMs) 0 250 500 750 1,000 1,250 1,500 1,750 Sales($MMs) U.S.Worldwide Allergan J&J Galderma GSK/Stiefel Nycomed Graceway WarnerChilcott Sanofi-Aventis Medicis Specialized
  7. 7. Broad Product Portfolio Estimated Peak Potential Diversified 7 <$200 $200-500 $500-1,000 >$1B ACUVAIL® ACZONE® SANCTURA XR® TAZORAC® Topical TRIVARIS™ ZYMAR® ALPHAGAN® / COMBIGAN® JUVÉDERM® / Dermal Fillers NATRELLE® / Breast Implants REFRESH® Tears Line NOVADUR™ - OZURDEX™ LAP-BAND® LATISSE® LUMIGAN® / GANFORT™ RESTASIS® BOTOX®
  8. 8. 8 Business Segments ~72% Reimbursed vs. ~28% Cash Pay FY 2009 $4.4 Billion +3% Urologics 2% Skin Care 3% BOTOX® Therapeutic 15% Obesity Intervention 6% BOTOX® Cosmetic 14% Breast Aesthetics 6% Facial Aesthetics 5% Ophthalmology 47% ~28%CashPay ~72%ReimbursedDiversified LATISSE® 2%
  9. 9. 2008 2009 2010 U.S. • ACZONE® • LATISSE® • TRIVARIS™ • ACUVAIL® • OZURDEX™ RVO • BOTOX® Chronic Migraine* • BOTOX® Spasticity* • JUVÉDERM® + Lidocaine • LAP-BAND® Adolescent Obesity* • LUMIGAN® 0.01%* • OZURDEX™ Uveitis* • Style 410 Breast Implant* • ZYMAR® X* EU • JUVÉDERM® + Lidocaine • VOLUMA™ • LUMIGAN® 0.01% ROW • BOTOX® Cosmetic (Korea) • BOTOX® Hyperhidrosis (Korea) • BOTOX® JCP (Australia) • BOTOX® Spasticity (Korea) • GANFORT™ (Brazil, Korea) • JUVÉDERM® + Lidocaine (Canada, Australia) • VOLUMA™ (Canada, Australia) • ALPHAGAN® P 0.1% (Brazil) • ALPHAGAN® P 0.15% (China) • BOTOX® Glabellar Lines (Japan, China) • BOTOX® JCP (Japan) • BOTOX® Neurogenic OAB (Brazil) • COMBIGAN® (Korea) • GANFORT™ (Australia) • JUVÉDERM® + Lidocaine (Brazil, Korea) • JUVÉDERM® (India) • LATISSE® (Korea) • LUMIGAN® 0.03% (Japan) • LUMIGAN® 0.01% (Canada, Brazil) • ORBERA™ (Australia) • VOLUMA™ (Latin America) • LATISSE® (Various)* 9 Variety of Growth Catalysts Worldwide Approvals / Launches Diversified * Anticipated future approvals
  10. 10. Growth 2009 Track Record of Creating Markets First 5 years of revenue growth BOTOX® Cosmetic RESTASIS® LATISSE® $0 $100 $200 $300 $400 $500 2002 2003 2004 2005 2006 $0 $100 $200 $300 $400 2003 2004 2005 2006 2007 $0 $100 $200 $300 $400 $500 Peak Potential 10
  11. 11. Track Record of Creating Markets Accelerated Sales Post Acquisition by Allergan Facial Aesthetics Breast Aesthetics Obesity Intervention Owned by Allergan Owned by Allergan Owned by Allergan $0 $50 $100 $150 $200 $250 2004 2005 2006 2007 2008 $0 $50 $100 $150 $200 $250 $300 $350 2004 2005 2006 2007 2008 $0 $50 $100 $150 $200 $250 $300 2004 2005 2006 2007 2008 Growth 11
  12. 12. 12 DTC - Spending Into Recovery LATISSE® JUVÉDERM® Growth
  13. 13. 13 RESTASIS® LAP-BAND® DTC - Spending Into RecoveryGrowth
  14. 14. Allergan DTC Spending Investing In Growth & Innovation AdvertisingExpense($M) Source: Allergan SEC filings. Expenditures net of media discounts, including fees and production costs. Growth 14 0 20 40 60 80 100 120 140 160 180 200 2003 2004 2005 2006 2007 2008 2009 +47% -7% +36%
  15. 15. Retina: $2,023 0%+26% 15 Worldwide Ophthalmics: High Market Shares in Fastest Growing Market Segments Source: IMS Global * Anticipated future approval Worldwide MAT Q3 ‘09 excluding Japan Market Growth AGN Market Share OZURDEX™ / TRIVARIS™ RESTASIS® ACUVAIL® REFRESH® / OPTIVE™ LUMIGAN® 0.01%* LUMIGAN® / GANFORT™ ALPHAGAN® / COMBIGAN® $ Millions Growth Anti-Infective: $882 16%+8% Other External Disease: $1,261 9%+6% Allergy: $862 6%+5% Other: $306 4%-1% Glaucoma: $4,411 22%+7% Artificial Tears: $1,020 29%+10% NSAIDs: $375 41%+19% Therapeutic Dry Eye: $507 100%+21% $0 $1,000 $2,000 $3,000 $4,000 $5,000 $6,000 $7,000 $8,000 $9,000 $10,000 $11,000 $12,000 ZYMAR® / ZYMAR® X*
  16. 16. 16 YTD 2009 world market growth 8% Allergan #2 market share position in 2008* Allergan #2 in Glaucoma 2008** * Source: Ophthalmics – IMS Global (48 countries) US$ sales growth, at constant exchange rates. Excludes retina. ** Source: IMS Global, Excluding Japan Ophthalmology Allergan fastest growing global ophthalmology company last 8 years* Alcon PfizerAllergan Merck Total Market -10% -5% 0% 5% 10% 15% 20% 2002 2003 2004 2005 2006 2007 2008 YTD Q3 '09 Merck -37% SalesGrowth* Growth
  17. 17. 17 • Therapeutic expected to re-accelerate with anticipated approvals – Spasticity, Chronic Migraine, and OAB BOTOX® Growth Performance Across Segments * Growth rate in 2006 compared to 2005 excludes $38.8 million of Japan BOTOX® net sales in the 2005 base amount. BOTOX® Franchise Cosmetic Therapeutic Sales($M) Growth 0 200 400 600 800 1,000 1,200 1,400 2002 2003 2004 2005 2006 2007 2008 2009 +42% +25% +28% +25% +30% +25% +20% +18% +16% +30% +60% +21% +32% +17%* +24% +23% +19% +29% +8% +8% +8% +0% +4% -4%
  18. 18. 18*Source: Allergan Market Estimates Top 5 European Markets (France, Germany, Italy, Spain, UK) Allergan Competition BOTOX® - The Winner in Europe MarketShare* Growth 2000 – YTD Q3’09: Market share gains + 14 points Total Market + 12 points Therapeutic Market + 3 points Cosmetic Market Cosmetic share ~80% 30% 35% 40% 45% 50% 55% 60% 65% 70% 2000 2001 2002 2003 2004 2005 2006 2007 2008 YTD Q3'09
  19. 19. $0 $200 $400 $600 $800 $1,000 $1,200 $1,400 $1,600 2002 2003 2004 2005 2006 2007 2008 YTD Q3‘ 09 19 Allergan: • Successful investments to drive market expansion • Stable market share despite several new competitors WW Neuromodulator Market BOTOX® Sales$Millions 86% 87% 85% 85% 85% 85% 81%83% * * Annualized Sales Creating & Leading High Growth Markets Worldwide Neuromodulator Market Growth
  20. 20. LATISSE® Sales Strategic Fit With Medical Aesthetics Franchise Global Market Peak Sales Could Exceed $500MM Growth 20 $0 $5 $10 $15 $20 $25 $30 Q1 2009 Q2 2009 Q3 2009 Q4 2009
  21. 21. 10.0% 12.0% 14.0% 16.0% 18.0% 20.0% - $100 $200 $300 $400 $500 $600 $700 $800 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010E $675 21 R&D Spend 1 Adjusted for non-GAAP items. See reconciliation at end of presentation. (Periods 1998-2001 not restated for 2006 change in financial reporting of amortization of acquired intangible assets) 2 Includes Allergan Medical activities for 9 months. 3 2010E represents midpoint of expectations provided on February 4, 2010 and has not been updated. This presentation does not reaffirm such expectations. • Major efficiency gains in 2009 • Completion of major clinical phase III trials in 2008/2009 • Mid-term investment goal ~17% of product net sales $98 $135 $164 $188 1 $228 1 $305 1 $343 1 $384 1 $476 1 $646 1 $729 1 R&D$(inmillions) R&Dasa%ofSales +38% +15%+21% +34%+21% +12% +12% +24% +36% +13% -7% 1 $722 +7% 2 3
  22. 22. 22 OZURDEX™ (dexamethasone intravitreal implant 0.7mg)  Retina Market Size:$2.1B*  5 Year CAGR: 42%  Current Treatment Options: Lucentis/Avastin, Macugen, Visudyne, Steroids, Laser * Worldwide MAT Q3 2009 • Launched Q3 2009 • Swelling of the central retina or macula due to obstructed retinal vein Macular Edema associated with RVO • Filed Q4 2009 • Inflammation in the vitreous and retina (back of eye) Uveitis (Intermediate & Posterior) • Phase IIIB (Dexamethasone implant as adjunctive therapy to Lucentis) • Added patient benefit in combination with Lucentis Age Related Macular Degeneration • Phase III (Enrollment completed Q2 2009) • Swelling of the macula resulting from leakage of damaged blood vessels due to diabetes Diabetic Macular Edema Growth
  23. 23. 23 Potential Future Catalysts for BOTOX® Therapeutic 1 Scher AI, Stewart WF, Liberman J, Lipton RB. Prevalence of frequent headache in population sample. Headache 1998. Bigal ME, Serrano D, Reed ML, Lipton RB. Chronic migraine in the population. Neurology, 71; 2008. •sBLA filed with FDA in Q3 2009 •Estimated to affect between 1.2 and 3.6 million people in the United States1 •Clinical Trials (155-195 Units every 12 weeks) BOTOX® Chronic Migraine •Approved in most international countries •Additional information requested by the FDA in its complete response letter submitted in Q3 2009 •Incremental peak year sales of $200M – $300M with U.S. approval BOTOX® Spasticity •Phase III trials for Neurogenic •Phase III trials for Idiopathic began recruiting Q3 2009 •Positive Phase II results for Idiopathic presented at AUA (April 2009) BOTOX® OAB •Phase II trials ongoing BOTOX® BPH •Phase I trials ongoing including assessment in Pain •Patented molecule Targeted BOTOX® Growth
  24. 24. Product Indication Ph I Ph II Ph III Filed Expected Approval LUMIGAN® 0.01% Glaucoma ● ● ● ● ● 2010 OZURDEX™ Uveitis ● ● ● ● ● 2010 OZURDEX™ Diabetic Macular Edema ● ● ● ● 2012+ ZYMAR® X Anti-infection ● ● ● ● ● 2010 RESTASIS® X Ocular Surface Disease ● ● ● 2012+ IOP Lowering: EP Agonist Glaucoma ● ● ● 2012+ IOP Lowering (Sustained Release) Glaucoma ● ● ● 2012+ NOVADUR™ (Brimonidine) Retinal Diseases ● ● ● 2012+ Androgen Tear Ocular Surface Disease ● ● ● 2012+ TKI ARMD ● 2012+ Product Indication Ph I Ph II Ph III Filed Expected Approval BOTOX® Adult Spasticity ● ● ● ● ● 2010 BOTOX® Chronic Migraine ● ● ● ● ● 2010 BOTOX® Juvenile Cerebral Palsy ● ● ● 2012+ Targeted BOTOX® (Next Generation) Pain ● ● 2012+ Neurology Pre- Clinical Ophthalmology Pre- Clinical 24 Strong R&D Pipeline
  25. 25. Product Indication Ph I Ph II Ph III Filed Expected Approval BOTOX® OAB (Neurogenic) ● ● ● ● 2011 BOTOX® OAB (Idiopathic) ● ● ● ● 2012+ BOTOX® Benign Prostatic Hyperplasia ● ● ● 2012+ Apaziquone Bladder Cancer ● ● ● ● 2012+ Product Indication Feasibility Clinical Filed Silicone Breast - Style 410 Cohesive Gel Breast Reconstruction / Augmentation ● ● ● ● 2010 LAP-BAND® Adolescent Obesity ● ● ● ● 2010 LAP-BAND® Lower BMI ● ● ● 2011 ORBERA™ (U.S.) Obesity ● ● ● 2012+ EASYBAND™ (U.S.) Obesity ● ● 2012+ VOLUMA™ (U.S.) Facial Aesthetics ● ● ● 2012+ Expected Approval Medical Device (Aesthetics / Health) Pre- Clinical Urology Pre- Clinical 25 Strong R&D Pipeline
  26. 26. 26 Patent Protection Product AGN Strategy 2009 ALPHAGAN® P 0.15% ALPHAGAN® P 0.15% Royalty ALPHAGAN® P 0.1% COMBIGAN® 2009 ACULAR® ACUVAIL® 2010 ZYMAR® ZYMAR® X 2014 LUMIGAN® LUMIGAN® 0.01% New IOP lowering molecules 2014 RESTASIS® RESTASIS® X • Products with expiries post 2020 – COMBIGAN®, SANCTURA XR®, LATISSE® • Strategies in place for products with short term expiries Limited Generic Exposure Strong Patent Estate
  27. 27. 27 Allergan Staying Power  Track record of investing to create markets with favorable global mega-trends  Multiple growth drivers with leading market share positions  Diversified product line with attractive payor mix (cash / reimbursed)  Moderately priced therapies  Fully integrated R&D • Strong, diverse product pipeline  Global infrastructure  Unique blend of management skills  Large enough to command sufficient resources to drive markets, small enough for nimble execution  Strong financial position
  28. 28. 28 Reconciliation of Selected Non-GAAP Financial Measures “GAAP” refers to financial information presented in accordance with generally accepted accounting principles in the United States. In this presentation, Allergan included historical non-GAAP financial measures, as defined in Regulation G promulgated by the Securities and Exchange Commission, with respect to estimates for the year ended December 31, 2009, and the corresponding periods for 1999 through 2008. Allergan believes that its presentation of historical non-GAAP financial measures provides useful supplementary information to investors. The presentation of historical non-GAAP financial measures is not meant to be considered in isolation from or as a substitute for results prepared in accordance with GAAP. In this presentation, Allergan reported the financial measures “Adjusted Sales”, “Adjusted SG&A”, “Adjusted R&D” and “Proforma Growth” as adjusted for Non-GAAP items. Allergan uses Adjusted Sales, Adjusted SG&A, Adjusted R&D and Proforma Growth to enhance the investor’s overall understanding of the financial performance and prospects for the future of Allergan’s core business activities. Specifically, Allergan believes that a report of Adjusted Sales, Adjusted SG&A, Adjusted R&D, and Proforma Growth provides consistency in its financial reporting and facilitates the comparison of results of core business operations between its current, past and future periods. Adjusted Sales, Adjusted SG&A, Adjusted R&D, and Proforma Growth are the primary indicators management uses for planning and forecasting in future periods. Allergan also uses Adjusted Sales and Adjusted R&D for evaluating management performance for compensation purposes.
  29. 29. 29 Reconciliation of Selected Non-GAAP Financial Measures Adjustments to GAAP research and development expense used to calculate research and development expense, adjusted for non-GAAP items, include the following: $10.0 million for an upfront payment for technology that has not achieved regulatory approval, a $21.0 million charge related to the modification of certain employee stock options in connection with a restructuring plan and $0.1 million of termination benefits related to the phased closure of the Arklow, Ireland breast implant manufacturing plant in 2009; $68.7 million for upfront payments for technologies that have not achieved regulatory approval and $0.3 million of termination benefits related to the phased closure of the Arklow, Ireland breast implant manufacturing plant in 2008; $72.0 million of in-process research and development expense related to the EndoArt acquisition in 2007; $579.3 million of in-process research and development expense related to the Inamed acquisition, $0.2 million of Inamed integration and transition costs and $0.5 million of transition/duplicate operating expenses in 2006; $1.5 million of transition/duplicate operating expenses and a $3.0 million buy-out of a license agreement in 2005; $458.0 million of in-process research and development expense related to the acquisitions of Bardeen Sciences Company LLC and Oculex Pharmaceuticals, Inc. in 2003; $0.7 million of duplicate operating expenses and a $4.0 million charge related to a collaboration agreement in 2002; and $40.0 million of in-process research and development expense related to the acquisition of Allergan Specialty Therapeutics, Inc. in 2001. GAAP research and development expense was $706.0 million, $797.9 million, $718.1 million, $1,055.5 million, $388.3 million, $342.9 million, $762.6 million, $232.7 million and $227.5 million in 2009, 2008, 2007, 2006, 2005, 2004, 2003, 2002 and 2001, respectively. GAAP research and development expense growth (decline) was (12%), 11%, (32%), 172%, 13%, (55%), 227%, 3% and 37% for 2009, 2008, 2007, 2006, 2005, 2004, 2003, 2002 and 2001, respectively.
  30. 30. March 2010 Allergan A Specialist in the Biopharmaceutical & Medical Device Industries
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