1. Veterinary Drug Compounding – A Drug Sponsor’s Perspective AAVPT 14 th Biennial Symposium, May 16-17, 2005, Rockville, MD Pg. 205-214 (Slide #1-10)

2. May 17, 2005 Julie Spagnoli, MS Director, Federal Government Affairs Bayer HealthCare, LLC Animal Health Division 1275 Pennsylvania Ave., N.W. Washington, D.C. 20004 Telephone: (202) 765-3775 E-mail: Julie.Spagnoli.B@Bayer.com

3. May 17, 2005 Veterinary Drug Compounding Concerns  Sponsors of pioneer drugs cannot offer for sale bulk active ingredients as an approved drug for compounding  Bulk active ingredients offered come from other sources and likely do not meet sponsor’s specifications  Compounded products may not meet safety or efficacy requirements of approved products

4. May 17, 2005 Veterinary Drug Compounding Concerns  Since 2000, Bayer has notified CVM of numerous violations by pharmacies and of suppliers of unapproved bulk active ingredients  For most, no action was taken  Finally, a civil suit was filed by Bayer against one of the most egregious offenders

6. May 17, 2005 Veterinary Drug Compounding: Tabor Case  In May 2000, a Bayer representative purchased a compounded product sold as enrofloxacin injectable solution from Tabor Drug.  Drug and analytical results showing it to be counterfeit material were sent to CVM  In 2002, Bayer notified CVM of additional counterfeit material being offered by an associated business, Kalchem International

7. May 17, 2005 Veterinary Drug Compounding: Tabor Case  In 2003, Bayer again notified CVM of the illegal enrofloxacin being offered for sale, including a recommended withdrawal period for swine. Bayer has been pursuing swine use for Baytril, but it is not yet approved.  In July 2003, Bayer filed suit against Tabor and Kalchem for deceptive trade practices for offering for sale a drug product posing as an equivalent to Baytril 100 injectable solution  Bayer is the only legitimate source of this product or enrofloxacin

8. May 17, 2005 Veterinary Drug Compounding: Tabor Case  Kalchem purchased a total of 1,305 kg of counterfeit enrofloxacin from four different sources  Kalchem also sold 68.15 Kg to other pharmacies  Most material was enrofloxacin HCl - Bayer’s approved products are manufactured with enrofloxacin base

9. May 17, 2005 Veterinary Drug Compounding: Tabor Case  Tabor purchased at least 364.86 Kg enrofloxacin from Kalchem and manufactured 6,574 bottles of counterfeit 100mg/ml injectable  Approximately 109,500 doses of counterfeit product sold to and administered by veterinarians and livestock producers

10. May 17, 2005 Illegal Veterinary Drug Compounding: Threats to food safety and animal health  Counterfeit bulk active ingredients from China or other countries, are not from approved sources and could be contaminated, misrepresented or ineffective  Unapproved drug substances may pose a threat to animal health and food safety, if used in food animals  Stronger controls are needed by FDA and U.S. Customs to stop the importation of these illegal drug substances