Pershing Square Activist Presentation Deck

Valeant's Cost Structure is a Competitive Advantage The pharmaceutical industry's high gross margins have supported wasteful SG&A and R&D spending Traditional Pharma(1) -77% -29% Gross Margin SG&A -19% R&D -28% EBIT Valeant Model (2013)² -75% -22% Gross Margin SG&A -3% R&D -50% 46 Traditional Pharma represents the average of Pfizer, Merck, Eli Lilly, and Bristol-Myers Squibb (2014 Est) based off Sanford Bernstein estimate. 2 Valeant 2013 Q4 Earnings Press Release EBIT Valeant has achieved one of the most competitive SG&A ratios in the industry, while continuing to grow organically

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