Hospira to Acquire Orchid's Generic Injectable Pharmaceuticals Business

LAKE FOREST, Illinois and CHENNAI, India, December 15 - — Strengthens Hospira's Manufacturing, Research and Development
Capabilities; Enhances Orchid's Financial Flexibility to Pursue New Growth
Opportunities –

Hospira, Inc. (NYSE: HSP), the world leader in generic injectable
pharmaceuticals, and Orchid Chemicals & Pharmaceuticals Ltd. (BSE: 524372,
NSE: ORCHIDCHEM), a leading Indian pharmaceuticals company and among the
top-five generic beta-lactam antibiotics manufacturers globally, today
announced an agreement for Hospira to acquire Orchid's generic injectable
finished-dosage form pharmaceuticals business for approximately US$400
million.

The acquisition includes Orchid's beta-lactam antibiotics manufacturing
complex (comprising cephalosporin, penicillin and carbapenem facilities) and
pharmaceutical research and development (R&D) facility at Irungattukottai,
Chennai, as well as its generic injectable product portfolio and pipeline.
Beta-lactam antibiotics represent a class of drugs with a wide spectrum of
antibacterial activity.

In addition, the companies signed a long-term exclusive agreement for
Orchid to supply active pharmaceutical ingredients (APIs) for the acquired
generic injectable pharmaceuticals business. This agreement builds on the
existing product development and commercialization relationship between
Hospira and Orchid.

    Through this transaction, Hospira:
    -- Acquires a proven-quality, cost-competitive generic injectables
       manufacturing site that has approvals from international regulatory
       authorities, including the U.S. Food and Drug Administration; the
       associated R&D facility and a talented base of approximately 450
       employees dedicated to the development and production of beta-lactam
       antibiotics;
    -- Secures full ownership of Hospira's primary beta-lactam portfolio and
       pipeline that were previously part of a commercialization agreement
       with Orchid; and
    -- Establishes a direct presence in India, providing a platform for
       future commercial growth.

"This acquisition aligns perfectly with Hospira's strategy to improve our
margins and cash flow, by lowering our cost position for a key product line,
and to invest for growth, by expanding our presence globally and reinforcing
our leadership position in generic injectables," said Terry Kearney, chief
operating officer, Hospira. "Orchid's quality, speed to market and
productivity are hallmarks of its business. We look forward to welcoming our
new colleagues from Orchid and leveraging their collective knowledge to meet
the evolving needs of Hospira's customers."

    Through this transaction, Orchid:
    -- Underlines its ability to develop value-added, niche skill-sets in the
       global pharmaceuticals value chain, and monetize them;
    -- Further fortifies its business model with long-term contractual API
       revenue streams;
    -- Enhances its financial flexibility to pursue new growth opportunities;
       and
    -- Creates a roadmap to continue delivering shareholder value.

"This transaction and the long-term API contract are a testimony to the
competitiveness of Orchid's product portfolio in the global pharmaceuticals
landscape, and its established capabilities in aseptic product manufacture.
We are confident that Hospira will take our generic injectable
pharmaceuticals business to even greater heights and provide enhanced career
prospects to the employees being transferred. This transaction will provide
Orchid with the financial flexibility to pursue new growth opportunities, and
build upon our successful track record of value creation for our
shareholders," said Mr K Raghavendra Rao, managing director, Orchid.

Hospira and Orchid are committed to supporting the various current
alliances and distribution arrangements of the acquired business.

Orchid/Hospira Partnership

In 2005, Mayne Pharma Ltd. (now part of Hospira) and Orchid entered into
a strategic commercialization and development agreement. Subsequent
agreements have added to the scope of the relationship, and the acquisition
announced today gives Hospira the manufacturing/R&D capabilities, product
application ownership and full commercialization rights to these products, as
well as access to new product licenses and distribution partnerships. The
long-term API agreement with Orchid will also ensure continuity of supply.

Transaction Details

The transaction has been unanimously approved by Hospira's and Orchid's
boards of directors. It is subject to Orchid's shareholders, regulatory and
legal approvals, as well as customary closing conditions. Assuming all
necessary approvals are secured, the transaction is expected to be completed
in the first quarter of 2010. To help facilitate the transition process, the
two companies will enter into transitional services agreements for
approximately 12 months.

Financials

The transaction is expected to be EPS neutral for Hospira in 2010,
excluding the impact of transaction-related expenses, such as purchase
accounting charges and integration costs, and the amortization of intangible
assets.

Advisors

Morgan Stanley is acting as financial advisor, Baker & McKenzie LLP as
international legal advisor and Khaitan & Co. as Indian legal advisor to
Hospira.

Citigroup Global Markets India Private Limited is acting as financial
advisor, Latham & Watkins LLP as international legal advisor and Crawford
Bayley & Co. as Indian legal advisor to Orchid.

Webcast

Hospira will host a conference call for investors and media at 11 a.m.
Central Time on Tuesday, Dec. 15, 2009. A live webcast of the conference call
will be available at www.hospirainvestor.com. Listeners should log on
approximately 10 minutes in advance to ensure proper computer setup for
receiving the webcast. A replay will be available on the Hospira Web site for
30 days following the call.

About Hospira

Hospira, Inc. is a global specialty pharmaceutical and medication
delivery company dedicated to Advancing Wellness(TM). As the world leader in
specialty generic injectable pharmaceuticals, Hospira offers one of the
broadest portfolios of generic acute-care and oncology injectables, as well
as integrated infusion therapy and medication management solutions. Through
its products, Hospira helps improve the safety, cost and productivity of
patient care. The company is headquartered in Lake Forest, Ill., USA, and has
approximately 14,000 employees. Learn more at www.hospira.com.

About Orchid

Orchid Chemicals & Pharmaceuticals Ltd. is a leading pharmaceutical
company headquartered in Chennai, India, involved in the development,
manufacture and marketing of diverse bulk actives, formulations and
nutraceuticals. With exports spanning more than 75 countries, Orchid is the
largest manufacturer-exporter of cephalosporin bulk actives in India and is
ranked amongst the Top 5-cephalosporin producers in the world. Orchid's
world-class manufacturing infrastructure includes multiple USFDA compliant
API and dosage form facilities at Chennai and Aurangabad in India. Orchid has
dedicated state-of-the-art GLP compliant R&D centres for API research, drug
discovery and pharmaceutical research at Chennai, India. Orchid has ISO
9001:2000, ISO 14001 and OHSAS 18001 certifications. Orchid is listed on the
National Stock Exchange (NSE), Bombay Stock Exchange (BSE) and the Madras
Stock Exchange (MSE) in India. Additional information is available at the
company's website at www.orchidpharma.com.

Private Securities Litigation Reform Act of 1995 -

A Caution Concerning Forward-Looking Statements

This press release contains forward-looking statements within the meaning
of the Private Securities Litigation Reform Act of 1995. Hospira cautions
that these forward-looking statements are subject to risks and uncertainties
that may cause actual results to differ materially from those indicated in
the forward-looking statements. Economic, competitive, governmental,
technological and other factors that may affect Hospira's operations and may
cause actual results to be materially different from expectations include the
risks, uncertainties and factors discussed under the headings "Risk Factors"
and "Management's Discussion and Analysis of Financial Condition and Results
of Operations" in Hospira's latest Annual Report on Form 10-K, and Hospira's
subsequent Quarterly Reports on Form 10-Q, which are filed with the
Securities and Exchange Commission, and incorporated by reference. Hospira
undertakes no obligation to release publicly any revisions to forward-looking
statements as the result of subsequent events or developments.

Orchid Safe Harbour

This media release includes forward-looking statements and indications,
which are based on current expectations and forecasts about future events.
Such statements and indications involve known and unknown risks,
uncertainties and other factors and may cause actual results to materially
differ. Such factors include, but are not limited to, changes in local and
global economic conditions, Orchid's ability to successfully implement
strategies, the market acceptance and demand of Orchid's products and
services, Orchid's growth rates, expansion, technological change and Orchid's
exposure to market risks. By their nature, these statements and indications
are only estimates and actual results could differ from these in the future.

Media, Stacey Eisen, +1-224-212-2276, or Tareta Adams, +1-224-212-2535, or Financial Community, Karen King, +1-224-212-2711, all of Hospira, Inc.; or Ch. Ram, Corporate Communications & Investor Relations of Orchid, +91-44-28244908, ram at orchidpharma.com. LOGO: www.newscom.com/cgi-bin/prnh/20040503/HSPLOGO