Ted Ayvas – Director IR & Corporate Communications Douglas Roth - CFO Leonard Schwartz - Chairman, CEO and President Hank Gracin – Securities Counsel of Lehman & Ellen

Scott Nussbaum – Broadlawn Capital Daniel Rizzo – Sidoti & Company David Jordan – Axiom Capital Management Christopher Schultz – York Asset Management Steve Bush – South Paw Investment. Gene Fox – Cardinal Capital Management Roger Feldman – West Creek Capital Lenny Dunn – Freedom Investors

Good morning and welcome to Aceto Corporation fiscal 2008 fourth quarter conference call and audio webcast. With me today is Leonard Schwartz, our Chairman, President, and CEO; Douglas Roth, our Chief Financial Officer; and Hand Gracin of Lehman & Ellen, our outside Securities Counsel.

During this call, Doug will give an overview of the Company’s results for the fiscal fourth quarter and year end June 30, 2008, and Len will discuss the performance of our business segment and provide an update on the strategic initiatives for growth. Following that we will open the call up for questions.

Now, I’d like to turn the call over to Doug Roth.

We are very pleased with the operating results that we have reported this quarter. Both our quarterly and fiscal year results represent record levels of sales, gross profit, net income, and earnings per share and in the case of the fiscal year, these results represent the second consecutive year of record sales and gross profits.

Now let’s take a look at the numbers, looking at the fourth quarter first. Sales increased 20% to $105 million compared to $87 million in the comparable 2007 quarter.

Gross profit increased 47% to $24 million from $16.5 million last year. Operating income also increased 104% to $12 million from $5.8 million in the fiscal fourth quarter of 2007.

Net income increased 90% to $8 million, the highest quarterly net income ever recorded at Aceto compared to $4.2 million for the 2007 comparable quarter. Earnings per diluted share were $0.32 in the fiscal fourth quarter, surpassing the $0.17 that we recorded last year and also this is compared to the guides at $0.21 per diluted share that we provided with our third quarter results.

Now looking at the full-year results for fiscal 2008, net sales were recorded at $360 million, a 14.7% increase over last year’s results of $313.5 million. Gross profit also increased 23.5% to $67 million compared to $55 million in 2007 comparable period and operating income of 42% to $21.4 million in 2008 compared to $15.1 million in fiscal 2007.

The resulting net income was $13.5 million or $0.54 per diluted share compared to $10.2 million or $0.41 for the full-year fiscal 2007. Now I’d like to turn the call over to Len.

Obviously, we are very, very pleased with the results. We are really, really pleased.

In the fourth quarter, all our business segments performed well, particularly our Health Sciences and Crop Protection segment as evidenced by the across-the-board increase in sales. Sales in our Health Sciences segment grew 35% largely the result of increased sales in both our foreign and domestic operations.

We did [inaudible]. This segment was especially profitable for Aceto generating 71% of our fourth quarter gross profit.

Chemicals & Colorants sales showed modest growth of about 1%. I’d now like to provide you with an update on our current strategic initiatives.

Our initiatives to provide vaccines to companion animals continues to move forward. The animal challenge retesting has been completed, and the results which confirm the results with the first set of testing that the vaccine if efficacious.

These results have been fully submitted to the USDA. Some of you may recall that we had to redo the testing because the FDA made a mistake in the protocol, although the first set of results showed as efficacious, means it works.

We redid the testing. The results were the same, all submitted to the USDA.

In addition, the protocol for the field safety tests, which we believe is the final major step in the approval process, has been submitted to the USDA for their review and we actually have permits in-hand to import the trial, quantities of trial vaccine or quantities of vaccine, trial quantities for testing. As we’ve said many times before, please be reminded that this is a regulatory view and while we’re doing everything that we can to expedite the process, there can be no assurance given as to when the approval process will be 100% completed.

It’s taking longer but it’s moving nicely, and we hope to see some resolution at some point in the not-to-distant future. Looking at our initiative to enter the Japanese pharmaceutical market, we’re very pleased to announce that we received our second order for a pharmacy.

We’re going to meet it from a Japanese pharmaceutical manufacturer. As we all know, Japan is a difficult market to enter for all kinds of reasons but particularly in the very conservative pharmaceutical industry there, there are very high barriers to entry.

We are encouraged by our early success. We’re adding to resources and continuing to move forward.

We believe there are significant business opportunities for the large number of sample requests that we have received, very significant number. With respect to our initiative to distribute finished doses from generic drugs under the Aceto brand name, our slow movement has been caused by the need to comply with Medicare, Medicaid, and private insurance reimbursement issues.

It is very difficult to setup a new pharmaceutical company these days, and this is what we’re experiencing, growing pains. Once the issue is resolved, it will enable us to succeed with our business of sourcing products directly from off-shore generic pharmaceutical companies and selling them directly to the large retail pharmacies rather than everybody else’s approach selling to all the generic companies or distributors.

The large retail pharmacies are very hopeful and are working with us because it will give them direct access to suppliers of generic drugs that they just don’t have because all the complexity of the marketplace, the least of which is the reimbursement issues. We have now created an in-house capability to deal with this problem, this issue, and we expect them to resolve soon.

As soon as they are, we expect to go to market with three products directly to the pharmacies. The last strategic initiatives that I’d like to review is the globalization of our nutraceutical business.

We’ve accomplished this. We created a Pan-European sales organization.

We’ve integrated our Singapore operation, and the business is going very nicely. I think we will now delete this as a strategic initiative because we’ve accomplished it.

Got that, Ted? No longer a strategic initiative.

It’s now an enhancement of our core business. As you know, we’re always looking for opportunities to expand.

Japan was the first one to go into a difficult marketplace. We have products; we have technology; we have regulatory support, and we’re trying to find new markets for our products.

One market that we’ve been looking at for some time is Vietnam. Vietnam is a vibrant marketplace of more than 100 billion people.

There are basic healthcare supply to all citizens. The government supplies healthcare to all citizens.

They have an active pharmaceutical industry. The pharmaceutical industry there has 90 manufacturers, and while ago we applied for a license to sell medicines, medical devices and APIs.

They lump them altogether, but we’ve been granted this license. We currently have two full-time Aceto sales reps in Vietnam, and we’re in the process of forming a representative office there now.

Our sales reps now basically work for our Singapore operation. Vietnam will ultimately report to Singapore in terms of the business going on, but we’re establishing a rep office there.

At some point in time, we would hope to establish a company there. It’s our understanding in Vietnam that wholly foreign-owned entities can establish companies there starting January 1, 2009 - very, very similar to China.

We’ve been through this experience in China, and it’s basically following the model for the introduction of foreign companies in Vietnam, so we now how to operate. I’m pleased to say that I’ve been invited to go to Vietnam to meet with the Vice-Chairman of the Vietnam Pharmaceutical Companies Association, and I intend to go.

We’re moving very quickly. We’re understanding the medical profiles: what are the largest diseases?

What are the problems? What drugs do they need?

What raw materials do they need? We’re quite anxious to go forward.

Last fiscal year 2008, we had sales of almost $8 million, so it’s growing very, very nicely. That was up quite a lot from the year before.

In summary, we are very pleased with our operating performance for the fourth quarter, and we clearly remain very optimistic about Aceto’s long-term strategic direction. We ended the fourth quarter fiscal 2008, June 30, with working capital of almost $130 million, no long-term bank debt, and shareholders exactly of $140 million.

This level of working capital provides us with the financial strength to capitalize on the sourcing opportunities in highly volatile markets, i.e., China and India. At the same time, continue to move our strategic initiatives and other activities forward, along with our newly created R&D work.

I’m sure a lot of you are going to ask: Why is Aceto doing well in the economic climate that [inaudible]? The economy in the world is not very good.

So in our press release this morning, we put in a paragraph to talk about history and why we are where we are now. So I’d like to talk about that a little bit so people can get a fuller understanding.

Since the globalization of Aceto in 1996, which since its founding in 1947, had been a manufacturers rep business were virtually all sales in the U.S. The company has developed into a globally integrated, highly technical, capable, independent distributor – very different business than before.

We used to be sales reps for foreign companies. As the world globalized, foreign company and then virtually all the foreign companies moved into the United States and then the Internet exacerbated that movement.

They simply didn’t need any distributors anymore, any sales reps anymore. So we morphed into a highly technical, capable, independent distributor.

This globalization consisting of establishment of our offices in Shanghai, acquisition of a U.S. distribution company from Witco, now Chemtura; the Schweizherhall distribution business; the 2001 acquisition of Schweizerhall Pharma with business locations in Germany, France, Holland, Singapore, India, and Hong Kong; the 2004 acquisition of Pharma Waldhof from Rouche; and most recently, the creation of our Indian headquarters and establishment of Aceto Japan.

During this time period, the company created a highly efficient and capable global technical regulatory and [inaudible] organization second to none. There is no one better than Aceto, while continuing to develop the entrepreneurial culture among its 225 employees.

I’d like to add that we did last fiscal year $360 million with 225 employees, and we’re very proud of that fact. As such, we remain optimistic about the Company’s long-term future prospects with our core business serving as a solid foundation for future growth and not forgetting that we need to continue to focus on strong cost controls.

That’s in our minds all the time. Now, before we open the call up for questions, I’m very pleased to announce that Aceto will be hosting its first ever Investor Day on September 18th at the Millennium Hilton Hotel on Church Street in the Wall Street area, downtown New York.

Our Investor Day will, for the first time, showcase the entire Aceto management team, including myself; Doug, the CFO; the heads of our three business segments in the United States, and the head of our major operating subsidiary in Europe. The goal of the day is to provide the investment community with an opportunity to meet the senior managers responsible for each of Aceto’s business segments.

Each of our managers will independently make a presentation and answer your questions regarding the businesses that they are responsible for. This will provide investors and other interested parties a unique opportunity to hear directly about the various business segments.

Again, as I said before, this is the first time we’re doing this other than myself and Doug and Ed, of course; he’s been with us a couple years. We welcome you to join us that day.

We’d be very pleased, and we will give you a free lunch. A press release will be issued shortly with more details.

This press release will be coming out after the conference call. It will tell you how to do it but basically just call Ted and tell him you’re coming and he’s be happy.

Now ladies and gentlemen, fire away at me!

Would you mind commenting on the unusual short interest in your stock? Do you have any insight to that?

I can’t figure it out.

We can’t. We really, we saw this happen at the time of the inclusion of Aceto and the Russell 2000 that day.

We really can’t comment or add training, but our only conclusion other than… You know as much as we do. Our conclusion is somebody thought we weren’t going to do well.

No other conclusion which obviously was not the case. So maybe you can find out more and let me know.

The strong sales, particularly in the crop protection business, does that include the business you sold from American Vanguard?

No, a teeny, teeny, virtually none. I mean none or virtually none, Doug, what is it?

We came to a conclusion right after we filed the Q, so the beginning of May, so probably there were some sales in… I think there were some sales but only small sales in April and that was it.

Very insignificant if there were any. We can supply that information to you, but it was really insignificant.

We had a restraining order or whatever so yeah.

Then, Len, you mentioned the growing pains you mentioned with the informed generics, how long do you think it’s going to last, I mean is it weeks/months in terms of the thing with Medicare?

This is not an approval. This is a registration.

The system… We are now looking at a few months; that’s where we are.

A few months, and I’m sorry, did you say three products or…

We have three products that once we get this registration, it’s very simple. The pharmaceutical industry has to kick back the Medicare 11%.

That’s all it’s about. You can’t just send the money; you got to be registered to do it.

It’s simple, but it’s incredibly complex because you have the Federal Government and all the states and they’re all intertwined. It’s just registration like getting a driver’s license.

What were the three products again?

Well, we’re not going to comment on those. Well, I can say one, and we’ve talked about before, [Adanistra].

You also said Isoflurane before, correct?

No, Isoflurane, we’re selling or we’ve been selling a little bit and it’s actually we’re going to freeze our sales. Isoflurane is a veterinary product not included in those products.

Isoflurane is in the inhaled anesthetics which we brought to market already. But when you’re dealing with a veterinary market, they’re not human, so there’s no reimbursement issues.

For some reason, I didn’t think that was a veterinary product. All right, finally…

Well, it’s also used… Let me get it right. Isoflurane, the marketplace is about three-quarters veterinary, one-quarter human.

We do not sell to the human market. We’re selling it to the veterinary market.

There’s no reimbursement issues. Medicaid doesn’t cover dogs, at least since I last found out.

Okay, but wouldn’t that have to be approved by the USDA then?

Oh yeah, we’ve had the approval. No, no, no, hold on.

Let me go back. In the veterinary market, chemical medicines are regulated by the FDA, biological medicines are approved by the USDA.

For Isoflurone is a chemical so it’s approved by the FDA, but our product was approved. Our supplier is an ANDA for human and veterinary use.

Finally, we have a lot of cash, which is obviously a great thing. I mean there any specific plans that you increased dividend or you are still looking at acquisitions.

What’s the story with that?

We have three things. You’ve seen reference our agrochemical business, crop protection, we have investment plans of something approaching $12 million over the next 12 to 18 months.

Within the fiscal 2009.

Okay, within the next 12 months. Okay, we have to expand about $12 million as compensation and expenditures for intellectual property.

As far as acquisitions, we’re always looking for acquisitions. We look at things from time to time and this is a case that we just want to make it right.

If something comes along to us, we’ll seriously consider it. I’m ready to go on a plane tomorrow to go look at an acquisition.

As far as the dividends, we have a general policy over the long-term, the Board does, myself personally, the Board does that we should return 40% of the profits as dividends and we’ll reconsider our position in December. But you may be well aware that we gave a special dividend of $0.05 in June I think it was, May or June, whatever, this year, and we are hot.

We are considering an increase in dividends, that’s all I have to say. But it will taken up at the Board meeting in December.

I’d like to add also that the Annual meeting in December will be at the NASDAQ market site to provide access to all our people and the NASDAQ has invited us since they’re such good friends, so we hope to have more people at our Annual meeting.

Congratulations. It looks like the patience and waiting was well deserved.

In terms of your margins in the fourth quarter, if revenues should continue to maintain these buoyant levels, are the margins in the fourth quarter something that could continue going forward?

The margins in the fourth quarter we exceptional and they were the result of a number of things that happened all at once. I would hope that those margins could continue, but I could not count on that at the present time.

Anything extraordinary in the margins?

Not extraordinary, just very, very good. Just a lot of things happened at once.

The $12 million that you said you’re going to have expense in intellectual properties, are those going to be expensed in calendar 2009? Will those goes against those margins?

David, no. If Len used the word expense, I didn’t hear it.

No, I did. I didn’t.

You said you’re going to spend, excuse me.

Yes, we need to invest. This is an intellectual property which we’ll be able to capitalize.

So there’s not going to be a hit to…

No, you’re not going to take a $12 million hit for data compensation for ag products, no. Our current policy is 10-year amortization.

Could you just talk a little bit more about the margins than you did so I can get… I know you’re not making any projects any more, but since you have everybody on the phone and you did have such as exceptional quarter, maybe you want to talk a little bit more about the margins, which I’d certainly appreciate. Could you talk about the likelihood of the momentum in the buoyancy in revenues in continuing?

We are optimistic about top line sales growth, no question about it. However, our business is inconsistent.

We have some highly profitable products we sell. If you go back five years ago in fiscal 2003, you see we had some highly profitable products.

The reason we did so well in 2003 and then we went down for a couple years was the generic market became very competitive.

But that’s what stimulated your margins this quarter is it?

What stimulated margins this quarter was a higher percentage of products sold at very good profit margins.

But not in the API business?

I didn’t say that.

Well perhaps you could give us more insight.

I think you can answer this another way. We announced that our generic, our health science segment, Doug, correct me if I’m wrong, was 58% of sales but 71% of gross margin.

So all you have to do is calculate the numbers and you’ll see that our health science segment did very well and also abutting, let’s say abutting or adding to the API business was a nutraceutical business that we’ve globalized… Can I talk about the number here? It’s globalized and it’s now a $38 million a year business at nice margins.

But you’re not seeing a repeat of 2003 are you?

We reconfigured our business. We’ve gone away from… We’ve tried to go away from these blockbusters and we have a much broader base of business.

Some of the products in that broad base of business had very, very high profit margins and essentially they all hit this quarter, the last quarter. Will they hit again?

We hope they do. We’re trying to make them hit again, but we can’t be certain they will.

But the business base, if that’s what you worried about, is much, much, much broader.

Congratulations first for this quarter. I’m a new shareholder to the Company.

I was wondering your characterization of Indian and Chinese market as being volatile, of course I know that the stock markets in these countries are volatile, but how does volatility in general affect your business in these markets? I’m assuming that there’s no direct correlation of capital markets with your operating businesses in China and India, so I was just wondering if you could give some flavor on what you refer to as volatility in those markets.

Sure. First of all, you’re correct in assuming that we have nothing to do with the capital markets in those countries, nothing at all, zero.

So that’s out of it. What happens is in terms of pricing of products, the United States is the least volatile market, well the [inaudible] and Japan are the least volatile markets in the world.

In other words, what I’m saying is the supply and demand effect on pricing in the United States is the least volatile. Europe’s a little more volatile, and China and India are much, much more volatile.

The reason being, in China, particularly in China and secondarily India, if there’s a product that’s growing rapidly, all of sudden you have ten people build factories. All these factories will come on stream and the price will collapse, and that’s why I’m talking about volatile markets.

Volatile markets for the products we buy, and we, Aceto, we have 28 people in Shanghai. We have a huge presence with the largest buyer of specialty chemicals and pharmaceuticals from export or export from China.

We buy $110 million from 500 different manufacturers, so we capitalize on the volatility of these marketplaces. For example, in the fourth calendar quarter of 2007, we realized that the Chinese government was going to start shutting down factories within a 200-mile radius of Beijing because of pollution issues.

Then they had terrorism issues. This is all leading up to the Olympics.

They shut down parts. You couldn’t ship parts, so we started building inventories in October/November of 2007 so when the factories got shut down in the first quarter, first calendar into the second quarter, we had a lot of inventories.

We picked up market position and it pushed up our margins too. That’s one of the strengths that we have in our extremely strong financial position.

We can build inventories. This is larger than our chemicals and colorants business that is currently very, very strong because we actually could supply products that other people couldn’t.

That’s what I mean by volatile marketplace, supply and demand base, pricing based on supply and demand. Is that clear?

Yes. So you’re trying to some degree to anticipate what future supply situation might be and act according with your capital base in place to basically outsmart the market in terms of where pricing is going in the future.

Yes, absolutely, but it’s more than just pricing. It’s market penetration.

We’re able to… We were able to supply products to customers in the last two months, a few people never bought for us, and they came: Oh can I buy, particularly in the nutraceutical area. Oh I need this.

Come on in and talk to me. Well how come you haven’t bought from me before?

Are these products that… Are these chemicals that you take in inventory, are they broad based enough in the demand so that you are not going to be stuck with them in a worse case scenario or is there always a steady demand for these?

Always steady demand. They are.

We’re always careful what we buy. We look at… Before anybody buys anything, they look at the short-term supply demand balance and everything we bought, we know we’re going to sell.

Our inventory write-downs are almost nothing these days, almost nothing. I mean almost nothing, no to even think about.

So we’re very, very cautious on what we buy and we have two levels of control to buying. In other words, our people will go to China or India, which is two-thirds of our product, our business people, and say, “Hey, I want to buy this.”

That’s their decision based on them and their management in wherever they may be in the U.S./Europe. But also our Chinese are highly capable, highly, highly capable of Chinese and Indian operations will actually say, “Hey, do you really want to buy now because we think the price is going down?

Well, hey, maybe you should be more because one factory is shut down,” which happened a lot pre Olympics. So it’s just the guts of our business.

This is our base business. We understand these marketplaces like nobody else does, particularly the big multinational companies who make mistake after mistake after mistake in China and India.

If I may ask a follow-up question, on Eastern Europe, you mentioned a couple of quarters or over the years, over the last two/three years, you mentioned an exposure that you were seeking in Poland and to some limited degree in Hungary, Czech Republic and I’m just wondering if you could give some flavor on anything that is going on in these more Eastern Europe or [inaudible] markets.

As you know, as you may know, we opened a new office in Poland about four years ago, in 2004, right, four years ago, we opened it up as a sales office where we ultimately came… We were doing some business as profitable. We were never able to expand it because we found out at the time, over the period of time that the Polish marketplace… Our two target markets were Poland and the Czech Republic.

The Polish market particularly is very low price marketplace. So what we’ve done is we’ve began in addition to their mission to sell, we’re still doing $3/$4 million business about that, I’m not sure it’s exactly right but about that, in Poland.

We’re doing some business in the Czech Republic, but we really didn’t focus on our sourcing and believe it or not the Czech Republic is a very, very important sourcing market for Aceto. We have some very strong relationships.

We get along very well with Czech people. We get along very well with Polish people and they’re both very good chemical producers.

Would it to be too much to ask what current sales levels in these areas is just Eastern Europe?

I think Poland about $3 million a year. We could verify it.

It’s not material. I would say between $3 and $4 million a year in Poland and the Czech Republic.

Hungary is a bigger market. We’ve been in Hungary for a long time.

But our move into the Poland was really for Poland and Czech Republic and Slovakia.

Give us a good sense of like how kind of how long some of these market developments take in terms of qualitative flavor.

We’ve been in Hungary for a long time.

When I look at API space, kind of healthcare space/API space and I have extensive experience with manufacturers of APIs and API manufacturers typically have to focus on a product portfolio and have to get it FDA approved manufacturing facilities and whatnot. So you usually see that an API producer such as Cambrex or Albany Molecular, they have to choose say 60 or 70 APIs in any given year or one-, two-, three-year period, so they have to clearly make choices which API to produce and for which API to seek regulatory approval from the FDA.

So I know that the guys who manufacture APIs, they have to limit themselves in what they can do for the markets the serve. Now knowing that companies have numbers such as this, 60 to 70 APIs, do you have a flavor of in how many different APIs you participate as a Company?

We participate in more than 200 APIs worldwide.

200 APIs.

More than 200.

More than 200.

I only have one kind of follow-up question. On the peanut sale related products, was the 4A market, was that peanut related as well.

Yes, 4A was on peanuts.

So your increased sales at [inaudible] for peanuts. This is a totally different…

Oh absolutely, not 4A, totally different product. 4A sales are known as nothing in the quarter.

No, I understand that. I’m just trying to figure out, I thought that was your only peanut product.

We launched a new peanut product.

Then did it compete against [inaudible] or totally different market.

Different market, totally different market, kills a different pest. Same market, peanuts, but kills a different pest.

Let me ask you this: Is there any… You didn’t do any stock buyback last quarter. Is there any plans maybe to spend $5 million to buyback stock while it’s still cheap?

We’re keeping our power dry. We feel we can make a better return on investment by investing in core businesses, strategic initiatives and hopefully, hopefully, hopefully, just hopefully an acquisition.

Well I look forward to seeing the future results.

Congratulations. You obviously are doing a great job.

It’s really nice to see. Especially seen the new initiatives are taking a bit longer, it’s nice to see the core business do well.

To try to address some of the issues that were raised earlier, could you talk about the safety concerns in the market and some of the things that you do to differentiate yourself so that you’re not competing just on price in the marketplace.

Are you coming to the Investment Day?

Of course.

We are going to rollout or whole global regulatory, testing regulatory capability at our Investor Day. However, let me say that we have global technical network that does quality assurance and regulatory support.

We now have 28 people. It cost us a lot of money, but it’s the baseline of what we do.

We made sure when we buy a product, it is safe and efficacious for its intended use. We now have global regulatory managers in the U.S., Germany, China, and India.

It’s a seamless work together operation. All I can tell you, and I don’t want to cast aspersion against the large pharmaceutical company whose name begins with a B, but that heparin thing would not have happened to Aceto.

We knew about heparin a year the people died in the United States. We identified the problem and we knew more about heparin than anybody else in the world including every government agency.

We spent a lot of time making sure that our regulatory mechanisms are capable and it’s not a staff function. We don’t separate a staff regulatory department with our line business like most companies.

Our business managers worldwide are responsible for their regulatory affairs and their regulatory department assists them. That’s the key, a key differentiator between us and virtually every other company.

Is that enough?

Yes, and I guess in the market two follow-ups to that. In talking about your competitors, is there anybody who has anything close to that and in terms of what that means for your business, could you talk about that in terms of…

I could tell you that not only in our competitors, but I could tell you that there is no other, I mean even the big pharmaceutical companies, the big guys make huge mistakes. I don’t have to tell you, you read the paper every so often.

The one that began with a B that killed 82 people and injured 200 people, all right. But there’s nobody else.

In our space, and API producers, distributors, nobody has anywhere near our capability, even the big pharma companies that are in China and India, they’re only looking at products that they make. They don’t look at the big picture.

We look at the big picture, so we are very unique. Listen, in 1996, Aceto did not have a single regulatory person.

We started building this capability and it took us more than 10 years to build and now it’s the best there is. Nobody evens close.

When you merge a regulatory with the sourcing because the regularly department also picks the best factories. You can buy cheap products, non approved products but they’re no good.

You can buy non-FDA approved APIs, but you can’t sell them. Does it help us in the marketplace?

Absolutely because big pharma, some of the big pharma companies in the U.S. and Europe actually rely on us now, believe it or not.

Congratulations on your success. I guess I have a follow-up to the question that was just asked and that is: Has your business model become, and I know you don’t want to give guidance, but when you think about the earnings power of the Company, did you just have a good year in ’08 or good quarter, a good last two quarters, or has the earnings power of the Company changed so that there is - - because you’ve created these different skills that the Company should given, grant it there will be volatility along the way, but should the Company be more profitable, again grant it the volatility, then it has been historically?

I got to say the answer is yes because of the value that we bring in terms of sourcing in third world, well China and India principally and the regulatory marriage to that, it enables us to business where other people can’t. I made reference before to the nutraceutical business.

We’re getting higher prices to nutraceutical business, higher margins if you will, for nutraceutical raw materials, nutritional dosage for our manufacturers because our competitors, some of them [inaudible] competitors can’t provide the regulatory support. So if the customer has to be from us and pay us 20% margins but can’t buy from the previous supplier that they were paying 10% margin because they can provide a manufacturer C of A with chain of custody of the goods.

That’s what you’re talking about. The answer is yes.

Just to refine that, you’re not looking at just good trading profits and just good execution, you’ve created something that has greater sustainable value and it likely to have greater sustainable ongoing profitability.

Absolutely. Look at our chemicals business.

We disclosed all this, right, the numbers and all that? If you look at our chemicals business, it keeps growing and growing and growing.

This is chemicals. Again, this is not as highly regulated as pharmaceuticals or our crop protection.

It’s chemicals because we have the sourcing and we have the technical capabilities in here. We have some regulatory challenges, but not as much obviously than pharmaceutical.

We believe we’ve been able to enhance, to grow our business, get more business. It’s about getting more business and at the same time enhancing our profit margins because of our capabilities, our organic capabilities that have grown.

It’s based on our sourcing and global technical capabilities.

I’ll see you at the Investor Day.

I look forward to seeing you then.

Everything looked great and so I have no complaints. I appreciate the dividend and the fact that you’re reconsidering or considering raising it at your December meeting.

I didn’t say we’re going to do it. At every December meeting, we have discussion about it, have consideration, so I don’t want to make any promises.

I understand. A lot of things can happen between now and December, but things look pretty good.

I also understand, and I read your news release, but it would seem like this companion animal vaccine borrowing some ridiculous snafu we could get up and running on this towards the latter part of the year. Is that too optimistic?

The government agent review were down for the last step. We’ve go the protocol there.

We’ve got the vaccine coming into the United States for the testing. We know the product works.

They made us do the challenges testing twice or again. I can’t see what can go wrong other than a snafu and the government agency is actually feeling a little bit guilty now, which is a good thing.

So it’s not pie in the sky for me to expect that borrowing lighting striking that we could probably could get this thing up and running during this calendar year.

This calendar year?

Yes. Well get it started in December is what I’m referring to.

We would expect the safety test [inaudible] discounted. It’s going to a lot of the safety.

We would expect the safety testing to start this calendar year.

When would it be when you’d actually be able to, assuming that there’s no problems?

Well the actual safety testing takes about six months and then you’ve got to submit this and they have to review it. But understand what the safety testing is, it’s not whether the animals die or they live or the product works, it’s any adverse drug reactions – swelling, edema, that kind of thing.

It’s not major stuff, all right. But we have not put anything in our projections for this fiscal year for this, I can tell you that.

Are you there?

Yes, I said I understand and I’m looking forward to getting some geometric not just a little bit of growth once this kicks in.

Us too. Listen, we’ve been at this four years; I feel a little frustrated myself too, believe me.

But when it goes, we’ll have the license that’s very, very valuable. There’s only four participants in the market now.

It’s a $400 million market and we believe our sales activities will go fairly smoothly.

I understand. I’m looking forward to it.

I guess I’m hoping it would come sooner than you’re projecting, but I guess it’ll be…

We’ll send you some vaccine for your dog if you have one.

Yes, I have one.

All right.

You’re going to spend $12 million of your $46 million in cash on intellectual property, is that what I heard, right?

Well it’s compensation for intellectual property.

So when you spend that in the next 12 months, what is your expected return and when is the visibility for that return, financial return? Could you explain that to me because it’s a lot money?

I got it. I got the answer is that our guidelines for investment in this area of business are that we got a complete return in 24 months.

That’s our guidelines and all of these products are in that range that we expect. It’s true.

On the agriculture space, with regards to the whole agriculture bucket, how many products are currently making after sales figures in this segment?

Four/five.

In the agrichemical space.

How many products?

Yes, because I’m assuming there all USDA approved. I was aware that until now it was two products that are actively USDA approved.

First of all, it’s the EPA, not the USDA.

Huh?

It’s the EPA, the Environmental Protection Agency. We have five products, less or minus.

Five products.

How many products? More?

Less than ten products, five big products let’s say.

In the future, it will move toward ten as they get approved.

We are working on, as we released, we’re working on four/six products.

As we said in some of our strategic initiatives, our goal here is to continue to go and introduce new products, and that’s what we’re doing. A couple years ago, we talked about three or four within a few years, so we’re on pace for that.

We have two. We’ll be more specific.

We have two products that we filed already that are at the EPA. We have two products we expect we expect to file within 90 days, and we have one or two that will come after that.

Len, I just wanted to get some clarification, I think I just heard you say that you can invest in your business at 50% returns and so I guess my first question is: Did I understand that correctly? Second, what is the life expectancy if you put up $12 million, $6 million in the first year, $6 million in the second year?

How many years does that go?

First of all, the $12 million represents four products. Second of all, our investment guidelines for data compensation for the acquisition of an EPA label is that we get a full return in 24 months.

But understand also and in every case, in every case we’re partnered with a distributor, so we’re not doing this to go buy, to get the labels and go into the market. We have sales in place as soon as we get the label for the appropriate season.

The life expectancy of these things is substantial. These are not new products.

These are all old products that have been going on for years and years. We’re just going to get a [inaudible] of old products.

Some of them has been 20/30 years in the marketplace.

As evidenced, Roger, when I said before that our practice, at least on the products that we own so far, is the 10-year amortization life. When Len says they’re 24 months, it’s pretax not after tax.

At 50% rates of return that’s even okay.

Roger, don’t think we just go pick up these things off the street. I mean this is… We go out to our customers, the five largest agriculture chemical distributors, we look, find out what they’re looking for, then we go to China and India.

It’s all part of our sourcing regulatory capability. It’s all merged together.

We make a partnership with the suppliers. In one case, in one of these products, we’re actually one of the partners is going to be the producer and then we do the data analysis.

We look at this. We do how much the data is going to cost because that these are all new products, the data cost less because that’s submitted to the EPA in support of a registration, i.e., a label has a compensable life of 15 years.

It’s like a patent. After 15 years, you can cite the label holders’ data, CIT, the label holders’ data, but you don’t have to pay them.

These are old products; they’ve been out a long time. We’re not in the cutting of new products, if you will.

This is old meat and potatoes day in/day out products. But the fact of the matter is that there’s been two situations that contribute to our ability to do this.

Number one: The continuing enhancement of our sourcing and technical capabilities. The technical effort on agrichemical products is as complicated as pharmaceutical products.

Make no mistake about it. Number two: The large agrichemical producers, the big guys, the Dow, Monsanto, DuPont have been acquiring everything in sight and they’ve been trying to commence this process of getting rid of distributors.

All right, so the large distribution companies are feeling threatened because the large companies are trying to take them out, the agrichemical producers, so we have a very, very unique market opportunity here.

Mr. Schwartz says that please don’t forget about Investor Day.

We’d all love to have you there. You’ll have opportunities to talk one-on-one to our senior managers about their businesses.

They’ll have constraints about what they can tell you just as we have here, but we’d love to see you there. Again, thank you very much and you can be sure that even though we’ve had good results, we’re not given up.

I can tell you personally that’s the case. Thank you very much.