First and foremost, we are committed to delivering quality, affordable healthcare products that improve 2008 ANNUAL REPORT T H E R I G H T P L A C E . Y . T H E R I G H P A N the quality of people’s lives. T T I M E . T H E R I G H T C O M 515 Eastern Avenue Allegan, Michigan 49010 (269) 673-8451 www.perrigo.com 2008 ANNUAL REPORT ©2008 Perrigo Company. All rights reserved. Shareholder Information Directors Executive Offi cers Independent Accountants Joseph C. Papa Through fi scal 2008, Chairman, President and BDO Seidman, LLP Chief Executive Offi cer Grand Rapids, Michigan Judy L. Brown Commencing fi scal 2009, Executive Vice President and Ernst & Young, LLP Chief Financial Offi cer Grand Rapids, Michigan Thomas M. Farrington Senior Vice President and Chief Fiscal 2008 Cash Information Offi cer Dividend Data John T. Hendrickson Fiscal Record Payable Per Share Executive Vice President, Global Quarter Date Date Amount Operations and Supply Chain 1st 8/24/07 9/18/07 $0.045 Moshe Arkin Laurie Brlas Gary M. Cohen Todd W. Kingma Former Vice Chairman, Senior Vice President, Executive Vice President, Executive Vice President, 2nd 11/23/07 12/18/07 $0.050 Perrigo Company Chief Financial Offi cer Becton, Dickinson and Company General Counsel and Secretary Director since 2005 and Treasurer, Director since 2003 3rd 2/22/08 3/18/08 $0.050 Cleveland-Cliffs, Inc. Sharon Kochan Director since 2003 Executive Vice President, U.S. Generics 4th 5/25/08 6/20/08 $0.050 Refael Lebel Executive Vice President and President, Perrigo Israel Shareholder Account Information Jeffrey R. Needham Senior Vice President, Shareholders with requests for Commercial Business Development information regarding their share position, stock certifi cates, address Jatin Shah changes and other related matters Senior Vice President, should contact: Chief Scientifi c Offi cer National City Bank Corporate Trust Operations Michael R. Stewart P.O. Box 92301 Senior Vice President, Cleveland, Ohio 44193-0900 Global Human Resources (800) 622-6757 James C. Tomshack Senior Vice President, Financial Information Consumer Healthcare Sales David T. Gibbons Ran Gottfried Ellen R. Hoffi ng Michael J. Jandernoa Annual reports, news releases, Dr. Louis W. Yu Former Chairman of the Board, Consultant and Director President and Former Chairman of the Board, earnings announcements, dividend Senior Vice President, Perrigo Company for public and private Chief Executive Offi cer, Perrigo Company announcements, Form 10-K, 10-Q Global Quality and Compliance Director since 2000 companies in Israel Applied NeuroSolutions, Inc. Director since 1981 and 8-K reports and other fi nancial Director since 2006 Director since 2008 information may be obtained by visiting Corporate Profi le the investor relations section of our Share Information Web site: www.perrigo.com/investors. Perrigo Company common stock is traded ® Perrigo Company is a leading global healthcare supplier that develops, on The NASDAQ Global Select Market and the Tel Aviv Stock Exchange (TASE) Investor Relations Contact under the symbol PRGO. Shares manufactures and distributes over-the-counter (OTC) and generic prescription (Rx) outstanding at June 28, 2008: 93,311,109 Arthur J. Shannon Vice President of Investor Relations and pharmaceuticals, nutritional products, active pharmaceutical ingredients (API) Global Communications (269) 686-1709 and consumer products. The Company is the world’s largest manufacturer of Annual Meeting Creative services by OTC pharmaceutical products for the store brand market. The annual meeting of shareholders Strategic Communication Advisors will be held at the Allegan County Area and Anderson Design Technical & Education Center, Grand Rapids, Michigan 2891 116th Avenue (M-222), Allegan, Michigan, on November 4, 2008, at 10:00 a.m. (EST) Gary K. Kunkle, Jr. Herman Morris, Jr. Joseph C. Papa Ben-Zion Zilberfarb Retired Chairman and Private practice of law, Chairman, President and Professor of Economics Chief Executive Offi cer, Memphis, Tennessee Chief Executive Offi cer, at Bar-Ilan University DENTSPLY International Inc. Director since 1999 Perrigo Company and consultant Director since 2002 Director since 2006 Director since 2007 Making quality healthcare more affordable. Contents 2 Financial Highlights 3 Letter To Shareholders 14 Market Review 16 Financial Reconciliation Inside Back Cover Shareholder Information 1 Financial Highlights Year Ended Financial Results – June 30, June 28, % Reported (GAAP) 2007 (1) 2008 (1) Change In millions, except shares Net Sales $ 1,447.4 $ 1,822.1 25.9 and per share amounts Operating Income $ 99.7 $ 197.5 98.2 Net Income $ 73.8 $ 135.8 84.0 Diluted Earnings Per Share $ 0.79 $ 1.43 81.0 Average Diluted Shares Outstanding (000’s) 93,807 95,210 1.5 Year Ended Financial Results Adjusted For June 30, June 28, % Non-recurring Items 2007 (1) (2) 2008 (1) (2) Change In millions, except shares Net Sales $ 1,447.4 $ 1,822.1 25.9 and per share amounts Operating Income $ 115.4 $ 218.7 89.5 Net Income $ 83.1 $ 150.1 80.6 Diluted Earnings Per Share $ 0.89 $ 1.58 77.5 Average Diluted Shares Outstanding (000’s) 93,807 95,210 1.5 Net Operating Net Diluted Earnings Sales Income Income Per Share ($ in millions) ($ in millions) ($ in millions) (in dollars) 218.7 1,822.1 1,447.4 150.1 1.58 115.4 83.1 0.89 2007 2008 2007 2008 2007 2008 2007 2008 Perrigo Annual Report 2008 (1) See Item 7 of the Form 10-K report for a discussion of results of operations. (2) See reconciliation of non-GAAP fi nancial measures on page 16. We have excluded certain non-recurring items when monitoring and evaluating Perrigo’s fi nancial results, because we believe this provides important insight into Perrigo’s ongoing operations. 2 Letter To Shareholders Joseph C. Papa Chairman, President and CEO Fiscal 2008 was an exceptional year. We had The Right Place: Perrigo is positioned squarely in record sales, record earnings and record cash the business of providing affordable healthcare. fl ow. These results refl ect the talent, hard work We are the only pharmaceutical company that and commitment of the Perrigo team. has built its business on a combination of OTC, generic Rx and nutritional products – a business Fiscal 2008’s results also reinforce our strategic model that works because it lowers people’s focus on delivering quality, affordable healthcare costs while increasing retailers’ profi ts. healthcare products through a one-of-a-kind pharmaceutical company. The Right Company: Perrigo has a long tradition of delivering shareholder and consumer value by But more than that, these outstanding results creating, producing and marketing a wide range confi rm that it truly is the right time and the right of high-quality pharmaceutical and nutritional place for the right company – Perrigo. products. In doing so, Perrigo has developed The Right Time: Today’s market dynamics – specialized capabilities for high-volume rising healthcare costs, a challenging economy, production, packaging and mass customization. an aging U.S. population, the related growth in This combination of experience and expertise demand for affordable healthcare – all make uniquely positions Perrigo to deliver quality, it the right time for Perrigo’s quality, affordable affordable healthcare products that improve the healthcare products. quality of people’s lives. PERRIGO vs. INDICES FY 2003-2008 Perrigo S & P DJIA NASDAQ NASDAQ HC DRG NBI Price 80% Performance 60% 40% 20% 0% Perrigo Annual Report 2008 -20% -40% JUNE 03 JUNE 04 JUNE 05 JUNE 06 JUNE 07 JUNE 08 3 An Unwavering Commitment to Quality Perrigo’s Strategic Pillars Even after investing more than $15 million in quality-related processes and activities, we were able to reduce our total cost of quality through signifi cant reduction in deviations, Throughout fi scal 2008, we continued our relentless scrap and recalls. focus on the fi ve pillars that we established last year Superior Customer Service as the foundation of our strategic plan: Although our increased sales volume added pressure to customer service demands, our customer service levels for fi scal 2008 improved over fi scal 2007. September 2007 December 2007 January 2008 Final FDA approval for Final FDA approval for Cetirizine Launch of Cetirizine Ciclopirox Topical Hydrochloride 5 and 10 mg Hydrochloride 10 mg Tablets Solution, 8% Tablets (Zyrtec®) (Zyrtec®) ® Perrigo Annual Report 2008 (Penlac Nail Lacquer) Perrigo Annual Report 2008 Acquisition of Galpharm Retail Brand Sales = $92 million Branded Rx Sales = $1.4 billion Healthcare Ltd., Yorkshire, England 4 4 “Perrigo is among the industry leaders in being fi rst-to-market with important new products.” Innovation procurement organization and, where possible, vertical integration between our own API and Being fi rst-to-market with new products in key manufacturing operations. “power categories” is at the forefront of our business strategy. In fi scal 2008, we reinforced People Perrigo’s position as an industry leader by At a time when many companies have reduced introducing important new healthcare products, their workforces, we continued to work hard including Omeprazole, Cetirizine and Clobetasol to recruit, develop and retain people who can Foam, that contributed $220 million to our sales grow along with Perrigo. We are committed to for the year. maintaining environments that foster meaningful Low Cost Structure involvement for all our people. With more than 60 percent of our costs in raw Without question, our commitment to these fi ve materials, we worked continuously to improve pillars contributed signifi cantly to our exceptional the economies of scale and the effi ciency of our performance in fi scal 2008 and is why we’re supply chain through a newly established global optimistic about fi scal 2009. March 2008 Launch of Omeprazole 20 mg February 2008 Retail Brand Sales = $750 million Final FDA approval for OTC Famotidine 10 mg, Calcium Perrigo partner, Teva Pharmaceutical Industries Ltd.