Dr. Reddy's Laboratories and Leiner Health Products Sign Exclusive 15-Year OTC Product Development and Marketing Agreement

HYDERABAD, India & CARSON, Calif.--Feb. 24, 2003--

Dr. Reddy's CEO to Join Leiner's Board of Directors

Dr. Reddy's Laboratories (NYSE:RDY) and Leiner Health Products today announced the completion of a 15-year exclusive product development and marketing agreement. This agreement is exclusively for Dr. Reddy's over-the-counter (OTC) drug products. Key elements of the agreement include: An exclusive marketing partnership with Leiner to distribute OTC products; a comprehensive Rx-to-OTC product pipeline; development of innovative private label OTC products; and establishment of an executive steering committee to manage product development.

The companies also announced that G. V. Prasad, Vice Chairman and CEO of Dr. Reddy's Laboratories Limited, will join the Board of Directors of Leiner Health Products on March 27, 2003.

"The partnership combines Dr. Reddy's scientific and technical expertise in pharmaceutical product development with Leiner's trusted leadership in private label sales, marketing and distribution in the United States market," said Mark Hartman, Executive VP, Generics Business, Dr. Reddy's Laboratories. "We chose Leiner to help us expand our OTC business as a complement to our growing generics business in the United States because of its dedication to private label sales and expertise in bringing self-care solutions to market quickly and efficiently," Hartman added.

"The recent completion of our agreement with Dr. Reddy's Laboratories and the participation of G. V. Prasad on our Board is a significant milestone in the growth of Leiner's OTC business," said Gale Bensussen, President of Leiner Health Products. "This strategic partnership has the potential to create enormous value for our retail partners and accelerate our growth as a leading supplier of OTC products. The alliance is a means of linking Dr. Reddy's product development capabilities with Leiner's private label sales expertise in servicing the nation's leading retailers," Bensussen added.

About Dr. Reddy's Laboratories

Established in 1984, Dr. Reddy's Laboratories (NYSE:RDY) is an emerging global pharmaceutical company with proven research capabilities. The Company is vertically integrated with a presence across the pharmaceutical value chain. It produces finished dosage forms, active pharmaceutical ingredients and biotechnology products and markets them globally, with focus on India, U.S., Europe and Russia. The Company conducts research in the areas of cancer, diabetes, cardiovascular, inflammation and bacterial infection.

About Leiner Health Products

Leiner Health Products is a leading private label supplier of self-care solutions to mass-market retailers. Headquartered in Carson, Calif., Leiner is the nation's largest private label vitamin manufacturer and a leading private label manufacturer of OTC products. The company provides the nation's leading retailers with more than 3,000 private label products.

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