Opinion of the Board of Management of Lek d.d. on the bid forthe purchase of all shares of the Company

hereby announces its opinion and declares that:

    1. Prior to the announcement by the Novartis Group on 29 August 2002 of its intention to make an offer to purchase all the shares of Lek d.d., a general understanding between the Bidder and the Board of Management of Lek d.d. was reached with regard to the content of the Bid, especially with regard to the envisaged consequences of the takeover, including among others the retention and expansion of the Company’s operations, including the production, sale and development in the field of generic drugs; retention and strengthening of the Company’s competitive position in combination with the Bidder in global markets; retention of the separate legal entity of Lek d.d. as well as a leading role for Lek d.d. in the Novartis Group in the field of generic drugs on the markets of South-Eastern Europe, in the region of Central and Eastern Europe and the Commonwealth of Independent States; and the retention of workforce numbers, Lek’s brand and profit distribution policy. The Board of Management of Lek d.d. herewith confirms that the Bidder’s intentions as stated in the Bid and in the prospectus are in line with the afore mentioned general understanding and therefore the Bidder’s proposed takeover of Lek d.d. is considered a friendly takeover;    

    2. The Bidder did not own any shares of Lek d.d. on the day before the publication of the Bid; there is no existing agreement between the Bidder and the Board of Management of Lek d.d. with regard to the manner of exercise of the voting rights, which arise out of the shares of Lek d.d. held by members of the Board of Management of Lek d.d. or the shares of Lek d.d., which the Bidder shall acquire in the event the Bid proves successful; the Bidder has been informed of the fact that based on the provisions of Article 40 and Article 67 of the Articles of Associaton of Lek d.d. the total number of votes cast by an individual shareholder in Shareholders Meetings, taking into account all voting shares of the Company, may not exceed 15 (fifteen) % of all votes until 30 June, 2003;    

    3. The members of the Board of Management of Lek d.d., who hold shares of Lek d.d. intend to accept the Bid and the Board of Management of Lek d.d. shall not offer its resignation;    

    4. The Board of Management of Lek d.d. is of the opinion that the offer price of SIT 95,000 for every Lek d.d. A share and Lek d.d. B share (the “Consideration”) is fair from a strategic and financial perspective. The financial evaluation was based primarily on the following methodologies: discounted cash flow, multiples paid in comparable transactions and trading multiples of comparable companies. In addition, the Board of Management of Lek d.d. has received a fairness opinion issued by ABN AMRO Corporate Finance Limited with respect to the fairness, from a financial point of view, of the Consideration to the shareholders of Lek d.d.;    

    5. The Board of Management of Lek d.d. has evaluated the Bid from a strategic and financial perspective; the Board of Management of Lek d.d is of the opinion that acceptance of the Bid and a successful takeover reduces the risks of the Company in achieving its future strategic plans and business goals and supports the further dynamic and successful development of the operations of Lek d.d. and Lek Group; therefore the Board of Management of Lek d.d. supports the Bid in its entirety, taking into account the interests of the Company as a whole and the interests of all shareholders of Lek d.d.; therefore we

recommend

that shareholders accept the Bid.

Lek d.d. has published a summary of the audited annual report for the year 2001 in the newspaper DELO on 23 May 2002. The annual report for the year 2001 is also available at Lek’s web site www.lek.si.

The audited book value per share on 31 December 2001 amounted to 33,000 SIT.

In accordance with the Act on Participation of the Employees in Management, the Board of Management of Lek d.d. will inform all employees of the Company of the content of the prospectus for the purchase of all shares of Lek d.d. as well as of the above stated opinion immediately after this opinion is published.

Ljubljana, 5 October 2002

Board of Management Lek d.d.