Matrix Laboratories

Dear Shareholders
 
 Your Company has gone through a number of significant business
 initiatives in the recent past and established itself as an integral
 part of a leading global pharmaceutical generic company within a short
 span of time. The primary drivers for this have been the Companys
 competent work torce and the tenacity to adapt to ever-changing
 dynamics of the industry.
 
 It gives me a great pleasure in informing you that over the last 12 -
 18 months, your Company has successfully evolved into an integrated
 pharmaceutical Company with capabilities that match the best in the
 industry.
 
 Your Company is today the second largest global API player with an
 impressive industry leading position of US DMFs and EU-DMFs. Over the
 last two years it has ramped up its finished dosage capabilities, both
 in development and manufacturing, with ANDA filings comparable to any
 leading company worldwide.
 
 The year gone by has been an eventful one, involving critical
 transformation and strategic realignment.  Total integration has been
 the key area of focus for your Company. Having taken a strategic
 decision to align Matrix with Mylan, I am pleased to inform you that
 your Companys performance in this regard has been outstanding.  While
 re-aligning with Mylan, your Company has succeeded in identifying
 critical business opportunities and a potential to derive maximum
 synergies that would ultimately enrich your Companys profile and
 result in enhanced stakeholder value.
 
 Last year, the management of your Company was engaged in the
 group-level integration of the Merck assets with the Mylan - Matrix
 family. This new combination, The New Mylan is the third largest
 generic pharmaceutical Company with vertical capabilities and a global
 presence in more than 90 countries. This brings another challenging
 opportunity for Matrix to rise to the occasion and deliver towards
 becoming the global supply hub tor the New Mylan, and consolidating
 its position in the generic pharmaceutical industry.
 
 We have reviewed all our investments in subsidiaries and have had to
 take a decision to bring in line our investment in Docpharma with the
 existing market realities. The operating conditions in the markets that
 Docpharma operates have undergone significant changes, regrettably most
 of them adverse. This has been reflected in our recent announcements on
 the performance ending March 31, 2008.
 
 1 am extremely happy to inform you of another significant change in the
 area of leadership. As you are aware, 1 am in the process of taking
 over the responsibility as the Head of Global Technical Operations at
 Mylan, while continuing to oversee the on-going integration of Matrix
 with the New Mylan and in ensuring that together, we are able to
 realize the true potential of the Company. We have brought in Mr.
 |agdish Dore, an industry stalwart who has had a long and successful
 stint with a global institution like Sandoz. During his stint with
 Sandoz, apart from being responsible for the business development
 operations in the Asia Pacific cluster, he was involved in the start-up
 of Sandozs business operations in India. With a strong and focused
 team backing him, I look forward to Jagdish taking your Company to the
 next level and fully unlocking its value in the New Mylan and in the
 global pharmaceutical industry.
 
 I take this opportunity to thank you all and our principal shareholder,
 Mylan Inc., for the excellent support during my tenure at Matrix and
 look forward to your continued support to Jagdish and the Matrix team
 in the future.
 
                                                      Warm Regards,
 
                                                       RAJIV MALIK