1. BIOTECH SUPPLY October 8-9, 2012 Crowne Plaza, Foster City, CA Sales & Operations Planning Kevin Pegels – Oct. 9, 2012

2. Introduction – Kevin Pegels (Kevin.Pegels@bayer.com) Presentation Title Date Work History: 3/2011 – Current: VP SCM Bayer Healthcare-Biotech 3/2009 -3/2011: Sr. Director SCM Bayer Healthcare – Medical Devices 6/2004 – 6/2009: Sr. Director SCM Clorox Company 6/2002 – 6/2004 – Director SCM Levi Strauss & Co. 6/1997 – 6/2002 – Director SCM in CPG Industry Deloitte Consulting 6/1988 – 6/1995 – Manager Clorox Company Education: 1997: MBA Harvard University 1988: B.S. Chemical Engineering Cornell University Certifications/Publications CPIM Certified Published in Harvard Business Review & Supply Chain Exec. Board

3. Agenda 1.S&OP – quick definition 2.S&OP at Bayer Healthcare-Biotech 3.S&OP – how to secure Sr. Management support 4.Q&A 9/3/2015 3

4. Sales & Operation Planning - General

5. S&OP Process Key Principles Key objective of process is to deliver optimal service to end customers/countries and meet commitments to the Business “One” demand forecast drives financial and supply chain planning. Budget forecasts and S&OP forecasts should be “aligned” at each quarterly RF update.. Identify potential risks/challenges early and develop contingency plans as required Need to make timely decisions based on solid analytics and be committed to decisions. Single source of the truth, data visibility and decision rationale clear across the organization Clear to organization that S&OP process improves performance and adds value (KPIs) Single Forecast Customer First Be Proactive Decision Making Transparency Proven Process

6. Biotech S&OP Process by Major Product Line STEP 3 Supply Planning (Production Scheduling) Tuesday-Thursday STEP 4 Pre-Executive Meeting Thursday before Step-5 meeting KPI Review, Capacity review, Launch Review, Identify escalation topics Last Thursday of every mth. STEP 5 Executive Meeting KPI Review, Business Review, Capacity Review, Regulatory Review, Resolve escalation topics Weekly Monthly STEP 1 Data Gathering (APO) Saturday-Sunday Affiliate STEP 2 Demand Planning (Supply Network Planning) Monday-Tuesday Communication / Verification Highlights: 1.S&OP process is co-owned by Supply Chain and Commercial Organization 2.S&OP process integrates weekly and monthly planning 3.Forward looking, normally 0-18 months 4.Focused on delivering KPIs, aligning supply/demand, and resolving business issues 5.Implemented in less than 6 months

7. S&OP – how to secure Sr. Management Support 1.Develop and “Sell” Business Case: improved customer service, reduced inventory, reduced scrap, and aligned supply and demand to support business growth 2.Leverage improved forecast accuracy as critical metric and link to strong S&OP process 3.Cross-functional nature of process and shared process ownership among commercial and supply chain requires Sr. Management leadership 4.Leverage industry benchmarks and best practice case studies 5.Secure top Sr. leadership who can drive ownership top down through the organization 9/3/2015 7

8. Typical S&OP Benefits 9/3/2015 8 Global S&OP process has driven substantial benefits over the past few years Inventory DOH are decreasing Excess/low shelf life inventory is decreasing In addition, customer service for the US and Europe has been above 98% target level in 16 out of past 18 months