Abraxis BioScience (ABII)

Manufacturing

We have manufacturing facilities in Melrose Park, Illinois, and Phoenix, Arizona. For the length of the applicable lease, our manufacturing facility in Melrose Park has been leased to APP and APP has agreed to provide certain contract manufacturing services to us in accordance with the terms of the manufacturing agreement. In addition, we lease from APP a portion of APP’s Grand Island, New York manufacturing facility to enable us to perform our responsibilities under the manufacturing agreement with APP for its term. The initial term of the manufacturing agreement will expire on December 31, 2011, but the term of the manufacturing agreement will be automatically extended for one year if either APP exercises its option to extend the lease for our Melrose Park manufacturing facility for an additional year or we exercise our option to extend the lease for APP’s Grand Island manufacturing facility for an additional year.

In addition, as part of the separation agreement, APP’s Puerto Rico facility was divided into two separate facilities and we took ownership of one part of the facility. The portion of the Puerto Rico facility that is owned by us following the separation is the 90,000 square foot active pharmaceutical ingredients manufacturing plant that was leased to Pfizer for a term expiring in February 2012. Pfizer vacated the premises in December 2009 and did not incur any penalty for the early termination of the lease.

We are required to comply with the applicable FDA manufacturing requirements contained in the FDA’s current Good Manufacturing Practice, or cGMP, regulations. cGMP regulations require quality control and quality assurance as well as the corresponding maintenance of records and documentation. Our manufacturing facilities must meet cGMP requirements to permit us to manufacture our products. We are subject to the periodic inspection of our facilities, procedures and operations and/or the testing of our products by the FDA, the Drug Enforcement Administration and other authorities to assess our compliance with applicable regulations.

Failure to comply with the statutory and regulatory requirements subjects the manufacturer to possible legal or regulatory action, including the seizure or recall of products, injunctions, consent decrees placing significant restrictions on or suspending manufacturing operations, and civil and criminal penalties. In September and October 2009, we voluntarily initiated a global recall of a total of twenty-five lots of Abraxane^® manufactured at the Grand Island, New York facility as a result of particulate matter observed in a small number of vials from the recalled lots. Adverse experiences with a product must be reported to the FDA and could result in the imposition of market restriction through labeling changes or in product removal. Product approvals may be withdrawn if compliance with regulatory requirements is not maintained or if problems concerning safety or efficacy of the product occur following approval.

Manufacturing

We have manufacturing facilities in Melrose Park, Illinois, Phoenix, Arizona and Barbengo, Switzerland. For the length of the applicable lease, our manufacturing facility in Melrose Park has been leased to APP and APP has agreed to provide certain contract manufacturing services to us in accordance with the terms of the manufacturing agreement. In addition, we leased from APP a portion of APP’s Grand Island, New York manufacturing facility to enable us to perform our responsibilities under the manufacturing agreement with APP for its term. The initial term of the manufacturing agreement will expire on December 31, 2011, but the term of the manufacturing agreement will be automatically extended for one year if either APP exercises its option to extend the lease for our Melrose Park manufacturing facility for an additional year or we exercise our option to extend the lease for APP’s Grand Island manufacturing facility for an additional year.

In addition, as part of the separation agreement, APP’s Puerto Rico facility was divided into two separate facilities and we took ownership of one part of the facility. The portion of the Puerto Rico facility that is owned by us following the separation is the 90,000 square foot active pharmaceutical ingredients manufacturing plant currently leased to Pfizer for a term expiring in February 2012. Pfizer has notified us that it intends to vacate the premises in May 2009. Pfizer will not incur any penalty for the early termination of the lease.

We are required to comply with the applicable FDA manufacturing requirements contained in the FDA’s current Good Manufacturing Practice, or cGMP, regulations. cGMP regulations require quality control and quality assurance as well as the corresponding maintenance of records and documentation. Our manufacturing facilities must meet cGMP requirements to permit us to manufacture our products. We are subject to the periodic inspection of our facilities, procedures and operations and/or the testing of our products by the FDA, the Drug Enforcement Administration and other authorities to assess our compliance with applicable regulations.

Failure to comply with the statutory and regulatory requirements subjects the manufacturer to possible legal or regulatory action, including the seizure or recall of products, injunctions, consent decrees placing significant restrictions on or suspending manufacturing operations, and civil and criminal penalties. Adverse experiences with a product must be reported to the FDA and could result in the imposition of market restriction through labeling changes or in product removal. Product approvals may be withdrawn if compliance with regulatory requirements is not maintained or if problems concerning safety or efficacy of the product occur following approval.

Manufacturing

We have manufacturing facilities in Melrose Park, Illinois, Phoenix, Arizona and Barbengo, Switzerland. For the length of the
applicable lease, our manufacturing facility in Melrose Park has been leased to APP and APP has agreed to provide certain contract manufacturing services to us in accordance with the terms of the manufacturing agreement. In addition, we leased from
APP a portion of APP’s Grand Island, New York manufacturing facility to enable us to perform our responsibilities under the manufacturing agreement with APP for its term. The initial term of the manufacturing agreement will expire on
December 31, 2011, but the term of the manufacturing agreement will be automatically extended for one year if either APP exercises its option to extend the lease for our Melrose Park manufacturing facility for an additional year or we exercise
our option to extend the lease for APP’s Grand Island manufacturing facility for an additional year.

In addition, as part of the
separation agreement, APP’s Puerto Rico facility was divided into two separate facilities and we took ownership of one part of the facility. The portion of the Puerto Rico facility that is owned by us following the separation is the 90,000
square foot active pharmaceutical ingredients manufacturing plant currently leased to Pfizer for a term expiring in February 2012. Pfizer has notified us that it intends to vacate the premises in May 2009. Pfizer will not incur any penalty for the
early termination of the lease.

We are required to comply with the applicable FDA manufacturing requirements contained in the FDA’s
current Good Manufacturing Practice, or cGMP, regulations. cGMP regulations require quality control and quality assurance as well as the corresponding maintenance of records and documentation. Our manufacturing facilities must meet cGMP requirements
to permit us to manufacture our products. We are subject to the periodic inspection of our facilities, procedures and operations and/or the testing of our products by the FDA, the Drug Enforcement Administration and other authorities to assess our
compliance with applicable regulations.

Failure to comply with the statutory and regulatory requirements subjects the manufacturer to
possible legal or regulatory action, including the seizure or recall of products, injunctions, consent decrees placing significant restrictions on or suspending manufacturing operations, and civil and criminal penalties. Adverse experiences with a
product must be reported to the FDA and could result in the imposition of market restriction through labeling changes or in product removal. Product approvals may be withdrawn if compliance with regulatory requirements is not maintained or if
problems concerning safety or efficacy of the product occur following approval.

Manufacturing

We have manufacturing facilities in Melrose Park, Illinois, Phoenix, Arizona and Barbengo, Switzerland. For the length of the applicable lease, our manufacturing facility in Melrose Park has been leased to New APP and New APP has agreed to provide certain contract manufacturing services to us in accordance with the terms of the manufacturing agreement. In addition, we leased from New APP a portion of New APP’s Grand Island, New York manufacturing facility to enable us to perform our responsibilities under the manufacturing agreement for its term. The initial term of the manufacturing agreement will expire on December 31, 2011, but the term of the manufacturing agreement will be automatically extended for one year if either New APP exercises its option to extend the lease for our Melrose Park manufacturing facility for an additional year or we exercise our option to extend the lease for New APP’s Grand Island manufacturing facility for an additional year. We expect that our Melrose Park, Phoenix and Barbengo facilities will be utilized to globally manufacture our current and future proprietary products, including Abraxane^® .

In addition, as part of the separation agreement, New APP’s current Puerto Rico facility will be divided into two separate facilities and we will take ownership of one part of the facility. The portion of the Puerto Rico facility that will be owned by us following the separation of the Puerto Rico facility is the 90,000 square foot active pharmaceutical ingredients manufacturing plant currently leased to Pfizer for a term expiring in February 2012.

We are required to comply with the applicable FDA manufacturing requirements contained in the FDA’s current Good Manufacturing Practice, or cGMP, regulations. cGMP regulations require quality control and quality assurance as well as the corresponding maintenance of records and documentation. Our manufacturing facilities must meet cGMP requirements to permit us to manufacture our products. We are subject to the periodic inspection of our facilities, procedures and operations and/or the testing of our products by the FDA, the Drug Enforcement Administration and other authorities to assess our compliance with applicable regulations.

Failure to comply with the statutory and regulatory requirements subjects the manufacturer to possible legal or regulatory action, including the seizure or recall of products, injunctions, consent decrees placing significant restrictions on or suspending manufacturing operations, and civil and criminal penalties. Adverse experiences with a product must be reported to the FDA and could result in the imposition of market restriction through labeling changes or in product removal. Product approvals may be withdrawn if compliance with regulatory requirements is not maintained or if problems concerning safety or efficacy of the product occur following approval.

Manufacturing

We have manufacturing facilities in Melrose Park, Illinois, Phoenix, Arizona and Barbengo, Switzerland. Following the distribution, for the length of the applicable lease, our manufacturing facility in Melrose Park will be leased to New APP and New APP will provide certain contract manufacturing services to us in accordance with the terms of the manufacturing agreement. In addition, we will lease from New APP a portion of New APP’s Grand Island, New York manufacturing facility to enable us to perform our responsibilities under the manufacturing agreement for its term. The initial term of the manufacturing agreement will expire on December 31, 2011, but the term of the manufacturing agreement will be automatically extended for one year if either New APP exercises its option to extend the lease for our Melrose Park manufacturing facility for an additional year or we exercise our option to extend the lease for New APP’s Grand Island manufacturing facility for an additional year. See “Relationship Between New APP and Us After the Separation and Distribution—Manufacturing Agreement” and “—Real Estate Leases.” We expect that our Melrose Park, Phoenix and Barbengo facilities will be utilized to globally manufacture our current and future proprietary products, including Abraxane^®.

In addition, following the distribution, Abraxis BioScience’s current Puerto Rico facility will be divided into two separate facilities and we will take ownership of one part of the facility. The portion of the Puerto Rico facility that will be owned by us following the separation of the Puerto Rico facility is the 90,000 square foot active pharmaceutical ingredients manufacturing plant currently leased to Pfizer for a term expiring in February 2012.

We are required to comply with the applicable FDA manufacturing requirements contained in the FDA’s current Good Manufacturing Practice, or cGMP, regulations. cGMP regulations require quality control and quality assurance as well as the corresponding maintenance of records and documentation. Our manufacturing facilities must meet cGMP requirements to permit us to manufacture our products. We are subject to the periodic inspection of our facilities, procedures and operations and/or the testing of our products by the FDA, the Drug Enforcement Administration and other authorities to assess our compliance with applicable regulations. In late December 2006, Old Abraxis received a warning letter from the FDA regarding the Melrose Park facility following a periodic review of the facility earlier in the year. The focus of the letter was the agency’s belief that Old Abraxis needed to accelerate the implementation of certain improvements that were presented by Old

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Abraxis, as well as make some of the improvements more robust. The FDA completed its re-inspection of the facility in September 2007. Based on that re-inspection, in October 2007, the FDA informed us that we had satisfactorily resolved the issues associated with the warning letter and began approving New APP’s pending product applications at that facility. Prior to the receipt of the warning letter, Old Abraxis had adopted a four-year modernization plan for the Melrose Park facility with estimated minimum capital expenditures of approximately $12 million. To date, Old Abraxis has spent approximately $6.8 million under the modernization plan. The total amount of, timing of implementing and percentage of completion under the modernization plan may vary and will depend upon, among other things, our ongoing compliance with FDA and other regulatory standards, changes in equipment technology and our anticipated manufacturing capacity and utilization. Notwithstanding the fact that New APP LLC will lease the Melrose Park facility from us for a term of four or five years following the separation and related transactions, we generally will be responsible for the cost of implementing the modernization plan.

Failure to comply with the statutory and regulatory requirements subjects the manufacturer to possible legal or regulatory action, including the seizure or recall of products, injunctions, consent decrees placing significant restrictions on or suspending manufacturing operations, and civil and criminal penalties. Adverse experiences with a product must be reported to the FDA and could result in the imposition of market restriction through labeling changes or in product removal. Product approvals may be withdrawn if compliance with regulatory requirements is not maintained or if problems concerning safety or efficacy of the product occur following approval.