Dr. Reddy's Acquires BASF's Pharmaceutical Contract Manufacturing Business and Related Facility at Shreveport in the US

Dr. Reddy’s Laboratories (NYSE:RDY) announced today that it has signed a definitive agreement to acquire BASF’s pharmaceutical contract manufacturing business and related facility in Shreveport, Louisiana, USA. This transaction is subject to customary closing conditions, and is expected to be completed within the first quarter of fiscal year 2008-09. The transaction will be funded using Dr. Reddy’s internal cash reserves or other committed credit facilities. Further financial terms and conditions of the transaction will not be disclosed. This business involves the contract manufacturing of generic prescription and over-the-counter products for branded and generic companies in the US. It recorded revenues of US$43 million for the year ended December 31, 2007. The acquisition will include the relevant business, customer contracts, related ANDAs and NDAs, trademarks, as well as the manufacturing facility and assets at Shreveport, Louisiana. It also includes a tolling and supply agreement. The facility is designed to manufacture solid, semi-solid and liquid dosage forms. It currently employs approximately 150 people and has a proven track record of compliance with regulatory authorities including the USFDA. Satish Reddy, Managing Director & Chief Operating Officer, Dr. Reddy's Laboratories, said, "Dr. Reddy’s is committed to building a leading Global Generics business over the next few years. And as we drive significant growth in our key markets, we will continue to expand our supply chain network into these markets to enable us to respond to local market needs as well as provide competitive solutions to our customers globally. The acquisition of BASF’s finished dosage manufacturing facility in the US will enable us to strengthen our supply chain for North America and provide a strong platform for pursuing additional growth opportunities.” Mark Hartman, President, North America Generics, Dr. Reddy’s Laboratories, said, "We are excited about this acquisition as this facility provides us with a profitable revenue base built on strong customer relationships with branded and generic companies. It also provides us with an additional platform to further expand our portfolio of prescription generics, OTC capabilities and product portfolio and the ability to supply generic products to US government agencies.” "We are pleased with Dr. Reddy’s decision to acquire BASF’s contract manufacturing business and facility at Shreveport, Louisiana and are encouraged by Dr. Reddy’s growth-oriented view of the business,” said Martin Widmann, Head of BASF’s Pharma Ingredients and Services global business unit. About Dr. Reddy’s Dr. Reddy’s Laboratories was established in 1984 in Hyderabad, India, and is a global pharmaceutical company with proven research capabilities. Dr. Reddy’s conducts research in the areas of diabetes, obesity, cardiovascular diseases, anti-infectives, and inflammation. The India based company produces finished dosage forms, active pharmaceutical ingredients, and biotechnology products which are marketed globally, with a focus on India, US, Europe, and Russia. (www.drreddys.com) About BASF BASF is the world’s leading chemical company: The Chemical Company. Its portfolio ranges from oil and gas to chemicals, plastics, performance products, agricultural products and fine chemicals. As a reliable partner BASF helps its customers in virtually all industries to be more successful. With its high-value products and intelligent solutions, BASF plays an important role in finding answers to global challenges such as climate protection, energy efficiency, nutrition and mobility. BASF has more than 95,000 employees and posted sales of almost €58 billion in 2007. BASF shares are traded on the stock exchanges in Frankfurt (BAS), London (BFA) and Zurich (AN). (www.basf.com) Disclaimer This press release includes forward-looking statements, as defined in the U.S. Private Securities Litigation Reform Act of 1995. We have based these forward-looking statements on our current expectations and projections about future events. Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results to differ materially. Such factors include, but are not limited to, changes in local and global economic conditions, our ability to successfully implement our strategy, the market acceptance of and demand for our products, our growth and expansion, technological change and our exposure to market risks. By their nature, these expectations and projections are only estimates and could be materially different from actual results in the future.