Welcome

Dear Colleagues,

This past year, 2009, was both an exciting and challenging year. In spite of the harsh economic conditions we have managed to complete our $40MM commercial manufacturing site on-time, and we’ve delivered forecasted results.

In general, I believe that in the foreseeable future the custom synthesis/ API manufacturing business will become even more competitive as there are fewer drugs in development. The situation might change in the next 5-7 years. This will happen after the existing pipeline is brought to commercialization and/or launched drugs lose patent protection. Until then, only the technically sound companies having adequate manufacturing infrastructure will be able to survive.

Our organization has managed, so far, to adapt quite well to the life cycle of the pharmaceutical industry. In 1999, when we crystallized out as Cambridge Major Laboratories, the market needs were predominantly focused on early stages of drug development. Around 2003 the focus of our customers started to shift more toward pilot plant manufacturing capacities. We addressed those needs by commissioning in 2004 our Washington Drive site; a premier API development facility. In the past couple of years our “pipeline” of maturing clinical API’s (and many on the open market) facilitated the need for launch/ commercial manufacturing capacities. CML responded to that demand, and on July 30, 2009, we dedicated a state-of-the-art large scale API manufacturing site on our campus in Germantown, Wisconsin. With much pride I can state that we have secured a sizeable portfolio of orders.

Our “slightly smaller” additions in Weert, The Netherlands, have also been completed and are fully utilized. It is also worth mentioning that in 2009 the financial performance of our Weert facility has been truly remarkable, growing revenues more than 20% versus 2008.

Within the past ten years CML’s operations in Holland and in the USA grew from small shops to well equipped, global providers of synthetic organic chemistry services. Today, our service offering spans from R&D, Process scale up, to Commercial Manufacturing. Our activities are primarily focused on delivery of GMP regulated API and related intermediates.

Strategically, we want to cover all areas of new drug development. That means that our organization has no intention to neglect the research based activities as we expand into the commercial manufacturing arena. I don’t believe that science-based organizations can function without strong R&D capabilities.

Naturally, nobility requires responsibility, and we mustn’t forget those values which brought us to the current success. We have to preserve our technical proficiency, the adherence to rules and regulations, and the focus on quality and timely delivery. We also have to remain enthusiastic and prove that science-based manufacturing is the only way of establishing sustainable growth and success.

As always, it takes two to achieve a success. The first half is CML and I want to thank all of our employees and associates for their efforts, hard work, and believing in our principles of life. The other half of our success – our customers/friends within and outside of the industry, families, etc., also deserve the same gratitude for their business and their trust in us.

President and CEO

Cambridge Major Laboratories Inc.