A jury of experts today presented the 2010 Fresenius Inventors' Award to a portable, capacitive-electrode-based electrocardiogram (EKG) system. Dr. Martin Oehler, an engineer from the Technische Universität of Braunschweig, Germany, won first place and €5,000 for his invention at the 11th Fresenius Inventors' Fair held in conjunction with the Medica international trade fair and congress in Dusseldorf, Germany. Second place and €3,000 were awarded to Jan-Marten Seitz, a mechanical engineer from the Institute of Materials Science at Gottfried Wilhelm Leibniz Universität in Hanover, Germany, who developed a process for the manufacture of bioresorbable magnesium stents (vessel wall supports). Physics Professor Werner Mäntele from the Institute for Biophysics at the Goethe University in Frankfurt am Main, Germany, was happy to receive the third prize and €2,000 for his device enabling the measurement of heparin concentration in blood by means of static diffusion of light.

The top prize-winning portable EKG system is equipped with over 29 capacitive sensors. These enable a high-resolution EKG measurement through clothing. The system can be applied directly over a patient's clothing and delivers an EKG signal within a few seconds. "Patients have to be disrobed in the case of conventional EKG measurements employing gel-based or dry electrodes, which causes delays. Furthermore, there is a risk of skin irritations as well as additional costs for consumable supplies in the use of adhesive electrodes," said award winner Oehler. "The capacitive EKG system we developed can save crucial time and is entirely reusable." An EKG records the electrical activity of coronary fibers. This information provides important parameters such as heart rate or cardiac rhythm, which render indications of heart conditions and coronary problems such as irregular heartbeat or a heart attack.

Seitz received the second prize for his process enabling the manufacture of bioresorbable magnesium stents. Stents are vessel wall supports which can be implanted in hollow organs in order to keep them fully open for example during paranasal sinus operations. Nonresorbable stents, for example made of silicon, are currently used for such applications. These either remain in the body, which can lead to complications for the patient, or subsequently must be removed, which can result in trauma and the formation of scar tissue. In contrast, the magnesium-alloy stents developed by Seitz are entirely bioresorbable, whereby their disintegration can be regulated by means of a special coating process.

The third-place device developed by Mäntele employs static diffusion of light to measure the concentration of heparin present in a patient's blood. Heparin is a medication to prevent the coagulation of blood. It is used, for example, during coronary surgery, in the course of hemodialysis treatments was well as in thrombosis prevention. Mäntele's apparatus measures the diffusion of light from nanoparticles formed within a blood plasma sample between heparin and the protamine peptide which counters the heparin's effectivity. Results are delivered within a matter of minutes and thus enable a precise control of blood coagulation both during and subsequent to an operation.

A total of 23 selected researchers and developers will be presenting their ideas until Nov. 19 during the Fresenius Inventors' Fair. A jury comprised of medical specialists and industry representatives chose the three prize winners from among the field of entries. The health care company sponsors the Fresenius Inventors' Fair to help researchers find professional business partners and industrial contacts as well as potential investors in order to further develop and market their ideas. Fresenius provides all the exhibiting entries display space and an exhibit booth at the fair free of charge, enabling them to present their developments to trade experts and media representatives from around the world. About 40 doctors, scientists, engineers, technicians and health care professionals were among the entrants this year. The Fresenius Inventors' Fair is held every two years during the Medica event. Last year, Medica had more than 138,000 visitors from Germany and abroad.

The Fresenius Inventors' Fair will be held Nov. 17-19 in Hall 8b during the Medica international trade fair and congress in Dusseldorf, Germany. Medica runs Nov. 17-20, 2010, from 10 a.m. to 6:30 p.m. (Saturday until 5 p.m.). Additional information on the Inventors' Fair is available at www.fresenius.com/inventorsfair; and about the Medica event at www.medica-tradefair.com.

Photographs of the award winners can be accessed online at http://tinyurl.com/erfinderpreis-2010.

Fresenius Medical Care AG & Co. KGaA (Frankfurt Stock Exchange: FME / New York Stock Exchange: FMS), the world's largest provider of dialysis products and services, yesterday introduced the 2008T, a smart-platform dialysis system featuring Fresenius Clinical Data Exchange® (CDX) software, at the American Society of Nephrology's 43rd Annual Meeting and Scientific Exposition in Denver, Colorado. The groundbreaking technology is the first fully integrated dialysis therapy and management information system on the market and was developed to help physicians and clinic operators adjust to the new bundled payment environment due to take effect in the United States in January 2011. Available immediately, the 2008T currently is scheduled to be marketed in North America and is cleared for use in the USA and Canada by the U.S. Food and Drug Administration and Health Canada.

The 2008T combines the company's most advanced hemodialysis delivery system with Fresenius Clinical Data Exchange® (CDX) to provide caregivers, for the first time, chairside access to both dialysis treatment and medical information system (MIS) data to facilitate real-time adjustments to therapy and care plans. The platform accommodates MIS software from third-party vendors as well as the company's proprietary systems, providing immediate access to all dialysis treatment and clinical trending data traditionally held in multiple locations. This integrated approach streamlines workflow and maximizes data collection for comprehensive billing.

The 2008T was developed in close association with the Renal Research Institute, one of the pre-eminent research institutions in the United States focused on improving the clinical care and quality of life of patients with chronic kidney disease.

Fresenius Medical Care AG & Co. KGaA ("FMC AG & Co. KGaA"; Frankfurt Stock Exchange: FME / New York Stock Exchange: FMS), the world's largest provider of dialysis products and services, and Galenica Ltd. ("Galenica") today announced the formation of a new renal pharmaceutical company (Vifor-Fresenius Medical Care Renal Pharma Ltd.) designed to develop and distribute on a worldwide basis products to treat iron deficiency anaemia and bone mineral metabolism for pre-dialysis and dialysis patients. The newly formed company extends existing agreements with Galenica.

Galenica will contribute to the company the intravenous (IV) iron products Venofer® (iron sucrose) and Ferinject® (ferric carboxymaltose) for use in the dialysis and pre-dialysis market (Chronic Kidney Disease, CKD stages III to V) on a worldwide basis. Commercialization of both IV iron products outside the field of CKD stages III to V will remain fully the responsibility of Galenica and its existing key partners.

Iron deficiency is the most common cause of anaemia. The market for intravenous iron products used in dialysis and pre-dialysis was approximately $1 billion in 2009. Venofer® and Ferinject® are market leaders of the global market for intravenous iron products.

Galenica will also contribute all rights for PA21, a novel iron-based phosphate binder exclusively to the new company on a worldwide basis while maintaining the recently announced agreement to develop and market this product in Japan with Kissei.

Phosphate binders are prescribed to patients generating high phosphate levels caused by the failure of their kidneys. In dialysis more than 80% of patients need phosphate binders. The phosphate binder market had a value of $1.5 billion in 2009. PA21, a non-calcium phosphate binder, is currently in preparation for phase III clinical studies and expected to be filed in the USA and Europe in 2012.

Fresenius Medical Care will hold a 45% share in the new company with headquarters in Switzerland. The transaction is subject to final anti-trust approval in certain regions.

Ben Lipps, Chief Executive Officer of Fresenius Medical Care, commented: "This investment allows Fresenius Medical Care to take the next major implementation step in its renal pharmaceutical strategy. With this agreement we are creating a leading worldwide renal pharmaceutical company which will align Fresenius Medical Care and Galenica more closely in developing innovative and effective pharmaceutical products for patients that suffer from chronic kidney disease."

Fresenius Medical Care AG & Co. KGaA ("the Company" or "FMC AG & Co. KGaA"; Frankfurt Stock Exchange: FME / New York Stock Exchange: FMS), the world's largest provider of dialysis products and services, today announced the finalization of the acquisition of Gambro's worldwide peritoneal dialysis (PD) business. This marks the successful completion of regulatory approvals by the relevant antitrust authorities.*

* Except Serbia as the approval by the relevant anti-trust authority is still preliminary.

Fresenius today announced its intention to issue Senior Unsecured Notes through its subsidiary Fresenius U.S. Finance II, Inc., subject to market conditions. The offering will comprise separate euro and US dollar tranches. The Notes are expected to have a maturity of 6 years or more.

Proceeds of the Notes offering will be used to further repay the bridge loan used to finance the acquisition of APP Pharmaceuticals. This bridge loan currently amounts to US$ 650 million, half of the initial drawing of US$ 1,300 million in September 2008. The other components of the acquisition financing have already been successfully completed: Senior Secured Credit Facilities including US$ 2,500 million term loans and US$ 550 million revolving facilities, a € 289 million equity issue and a € 554 million Mandatory Exchangeable Bond.

The Notes are being offered in private placements and there will be no public offering of the Notes.

Fresenius confirms its outlook for 2008. Group sales were expected to grow by 9.5 to 10.5 % and net income by 10 to 15 %, both in constant currency. This outlook excludes the APP acquisition and related special items.

Fresenius also provides a preview on its expectations for 2009. Group organic sales growth is expected to be at least in the mid single-digit range. Net income growth in constant currency and before special items related to the APP acquisition is expected to be greater than organic sales growth. A detailed outlook will be provided as part of the 2008 earnings release expected to be issued on February 19, 2009.

For current information about the Fresenius Group, please see our website www.fresenius.com.

About Fresenius SE
Fresenius is a health care group with international operations, providing products and services for dialysis, hospital and outpatient medical care. In 2007, group sales were approx. € 11.4 billion. On September 30, 2008 the Fresenius Group had 121,288 employees worldwide.

Fresenius today announced that it has successfully raised US$ 800 million equivalent through an offering of unsecured Senior Notes by its subsidiary Fresenius U.S. Finance II, Inc. The Notes comprise separate euro and US dollar tranches. The euro tranche of € 275 million principal amount will be issued at a price of 93.024 % and will have a coupon of 8.75 %, resulting in a yield to maturity of 10.25 %. The US dollar tranche of US$ 500 million principal amount will be issued at a price of 93.076 % and will have a coupon of 9.00 %, resulting in a yield to maturity of 10.50 %. Both tranches will mature in 2015 and are non-callable.

The transaction was extremely well received by investors. Both tranches were substantially oversubscribed with a total order book in excess of US$ 5.0 billion.

Proceeds of the Notes offering will be used to replace the bridge loan used to finance the acquisition of APP Pharmaceuticals, to repay other debt and for general corporate purposes.

With this transaction the financing of the APP Pharmaceuticals acquisition is completed.

Standard & Poor's has assigned a BB rating to the Notes and Moody's assigned a provisional Ba1 rating. This is in line with Fresenius SE's existing unsecured Senior Notes and its corporate credit rating.

The Notes have been offered in private placements without a public offering.

The offering of the Notes is expected to be closed and settled on January 21, 2009 subject to customary closing conditions. It is planned that the Notes will be listed on the Luxembourg Stock Exchange.

For current information about the Fresenius Group, please see our website www.fresenius.com.

About Fresenius SE
Fresenius is a health care group with international operations, providing products and services for dialysis, hospital and outpatient medical care. In 2007, group sales were approx. € 11.4 billion. On September 30, 2008 the Fresenius Group had 121,288 employees worldwide.

The European Medicines Agency's (EMEA) Committee for Medicinal Products for Human Use (CHMP) today issued a positive opinion recommending approval of Removab for the intraperitoneal treatment of malignant ascites.

The approval by the European Commission (EC) is expected within a few months. The decision, which is usually based on the CHMP opinion, will apply to all EU member states. Removab would be the first drug worldwide with a regulatory label for the treatment of malignant ascites. Fresenius Biotech is prepared to launch Removab upon approval.

The CHMP opinion is based on the results of one large international phase II/III pivotal study with the primary endpoint of puncture-free survival*. The study demonstrated that patients receiving Removab experienced a four-fold increase in puncture-free survival over a therapy consisting of puncture alone. These data were presented at the 2008 Annual ASCO Meeting in Chicago, Illinois.

"The positive opinion is important news for all cancer patients diagnosed with malignant ascites and we look forward to filling a high unmet medical need with Removab" says Ulf Mark Schneider, Chairman of the Management Board of Fresenius SE. "The launch of Removab is a significant milestone for Fresenius Biotech as it progresses from the development to the successful commercialization of biopharmaceutical products."


Background information:

*About the Pivotal Study
The study involved 258 patients with malignant ascites due to carcinomas. Of those, 129 suffered from ovarian cancer while another 129 had non-ovarian cancers. Patients received both puncture (paracentesis) and four intraperitoneal infusions of Removab within 11 days, or paracentesis alone (control group).
The trial met its primary endpoint with high statistical significance. Patients treated with Removab showed a median puncture-free survival (primary endpoint) of 46 days compared with 11 days in the control group (p< 0.0001) (Hazard Ratio: 0.254). Puncture-free survival was defined as the period between the last infusion and the first subsequent necessary puncture or death, whichever occurred first. The median puncture-free time – a secondary endpoint which did not include the data from patients who died before the next ascites puncture was due – was 77 days versus 13 days (p< 0.0001).

The most common side effects observed during the trial, such as fever, nausea and vomiting were all due to Removab's postulated mode of action.
These side effects were predictable, limited, manageable and mostly fully transient.

Malignant Ascites
Malignant ascites can be caused by different carcinomas. Abdominal spread of cancer cells leads to an accumulation of fluid in the abdominal cavity and is associated with a poor prognosis. The most commonly used treatment of malignant ascites is puncture (paracentesis), which has to be carried out on average every one to two weeks and can lead to complications such as infection and fluid or protein deprivation. The trifunctional antibody Removab is known to kill cancer cells in the peritoneal cavity and therefore attacks the primary cause of ascites formation.

Trifunctional Antibody Removab® (catumaxomab)
Removab with its trifunctional mode of action represents the first antibody of a new generation. The therapeutic objective of Removab is to generate a stronger immune reaction against cancer cells. Removab binds to three different cell types simultaneously: One arm of the antibody recognizes and binds to T cells, the other arm binds EpCAM (epithelial cell adhesion molecule) that is expressed in many types of carcinomas. In addition, immune effector cells with Fc receptors (such as macrophages, monocytes, dendritic cells and natural killer cells) bind to the Fc region of Removab. This simultaneous binding subsequently results in the co-stimulation and activation of T cells and accessory cells, enabling the generation of a strong immune response against cancer cells.
Preclinical data for trifunctional antibodies also suggest a potential long-lasting effect to prevent cancer recurrence. Removab is further developed in various indications (e.g. gastric and ovarian cancer) addressing the underlying cancer.
Catumaxomab is a trifunctional antibody developed by TRION Pharma GmbH.

• Sales: € 12.3 billion, +9 % at actual rates, +13 % in constant currency
• Adjusted EBIT: € 1.7 billion, +7 % at actual rates, +11 % in constant currency
• Adjusted net income: € 450 million, +10 % at actual rates, +13 % in constant currency

• Sales and earnings growth across all business segments
• Continued excellent growth in Q4/08
• Long-term acquisition financing of APP Pharmaceuticals successfully finalized
• 16th consecutive dividend increase
• Substantial sales and earnings growth expected for 2009

The Group's US GAAP annual financial results as of December 31, 2008 include special items relating to the acquisition of APP Pharmaceuticals. The single-largest of those items is the full depreciation of acquired in-process R&D activities, leading to a non-cash charge of € 272 million. Under IFRS, acquired in-process R&D is capitalized and amortized over the expected life of the developed products. IFRS and US GAAP financial statements therefore differ significantly. The IFRS approach has been adopted by US GAAP as from 2009.

Adjusted earnings represent the Group's business operations in the reporting period. Including special items, EBIT is € 1,477 million and net income is € 270 million (see reconciliation on page 4). Under IFRS, EBIT is € 1,760 million and net income is € 529 million.


Dividend increase proposed
Based on the excellent financial results the Management Board will propose to the Supervisory Board a dividend increase of 6 % to € 0.70 per ordinary share (2007: € 0.66) and € 0.71 per preference share (2007: € 0.67). The total dividend distribution increases by 10 % to € 113.6 million.

Positive outlook for 2009: Substantial sales and earnings growth expected
For 2009, Fresenius projects further improvements in its financial results: Group sales are expected to grow by more than 10 % in constant currency. Organic growth is projected to be in a 6 to 8 % range. Adjusted net income (before special items) is expected to increase by aproximately 10 % in constant currency. The special items relate to the mark-to-market accounting of both the mandatory exchangeable bond (MEB) and the contingent value right (CVR) and are not cash relevant.

The Group plans to invest € 700 to 750 million in property, plant and equipment (2008: € 764 million).

Sales growth of 13 % in constant currency
Group sales increased by 13 % in constant currency and by 9 % at actual rates to € 12,336 million (2007: € 11,358 million). Organic sales growth was 8 %. Acquisitions contributed a further 5 %, mainly driven by the consolidation of APP as from September 1, 2008. Currency translation had a negative impact of 4 %. This is mainly attributable to the average US dollar rate depreciating 7 % against the Euro.


Sales growth in the business segments was as follows:



In Europe sales grew by 15 % in constant currency with organic sales growth of 9 %. In North America constant currency growth was 9 % with organic growth contributing 5 %. The increase in constant currency is mainly due to the first-time consolidation of APP Pharmaceuticals. Strong organic growth rates were achieved in the emerging markets, reaching 17 % in Asia-Pacific and 18 % in Latin America.

 
Strong earnings growth
Adjusted Group EBITDA increased by 12 % in constant currency and by 9 % at actual rates to € 2,203 million (2007: € 2,030 million). Adjusted Group operating income (EBIT) grew by 11 % in constant currency and by 7 % at actual rates to € 1,727 million (2007: € 1,609 million). The Group's adjusted EBIT margin was 14.0 % (2007: 14.2 %). Adjusted Group EBIT includes a € 8 million non-cash charge related to the amortization of acquired intangible assets. Group EBIT (including special items) was € 1,477 million.

Group net interest was € -431 million (2007: € -368 million). Lower average interest rates on liabilities of Fresenius Medical Care and currency translation effects had a positive impact. This was offset by incremental debt relating to the acquisitions of APP Pharmaceuticals and Dabur Pharma.

The adjusted Group tax rate was 34.1 % (2007: 36.1 %). The Group tax rate including special items was 39.5 %.

Minority interest increased to € 404 million (2007: € 383 million), of which 93 % was attributable to the minority interest in Fresenius Medical Care.

Adjusted Group net income grew by 13 % in constant currency and by 10 % at actual rates to € 450 million (2007: € 410 million). Adjusted earnings per ordinary share increased to € 2.85 and adjusted earnings per preference share increased to € 2.86 (2007: ordinary share € 2.64, preference share € 2.65). This represents an increase of 11 % for both share classes in constant currency.

Reconciliation to adjusted earnings
The table reconciles 2008 adjusted Group EBIT and adjusted Group net income to earnings according to US GAAP:



According to US GAAP rules valid until year-end 2008, acquired in-process R&D activities have to be fully depreciated at the closing of an acquisition.


The inventory step-up reflects the excess of fair value over book value of acquired semi-finished and finished products. The amount is amortized in line with the sale of the respective products.


The foreign exchange gain arises, inter alia, from US-Dollar strength increasing the value of US$-denominated inter-company loans to Fresenius Kabi Pharmaceuticals Holdings, Inc.


Both the Mandatory Exchangeable Bonds and the Contingent Value Rights are viewed as liabilities and therefore recognized with their fair redemption value. Valuation changes will lead to gains or expenses on a quarterly basis until maturity of the instruments.


One-time financing expenses include commitment and funding fees for the by now refinanced bridge facility as well as the full depreciation of financing costs related to APP's Syndicated Facility from 2007.


Group net income (including special items) was € 270 million or € 1.71 per ordinary share and € 1.72 per preference share.



Continued investments in growth
Fresenius Group spent € 764 million for property, plant and equipment (2007: € 700 million). The increase reflects the substantial organic growth opportunities in the markets the Group is operating in. Acquisition spending was € 3,853 million (2007: € 618 million), primarily due to the acquisition of APP Pharmaceuticals.



Sustainable cash flow development
Operating cash flow of € 1,074 million was below previous year's € 1,296 million mainly due to an increase of inventories and trade accounts receivables. The cash flow margin reached 8.7 % (2007: 11.4 %). Due to the lower operating cash flow and increased net capital expenditure of € 736 million (2007: € 662 million), cash flow before acquisitions and dividends decreased to € 338 million (2007: € 634 million). Dividends of € 245 million were financed out of cash flow. Acquisitions were financed through new debt and equity.



Balance sheet impacted by APP acquisition
Fresenius Group's total assets increased by 31 % in constant currency and by 34 % at actual rates to € 20,544 million (December 31, 2007: € 15,324 million). The increase in total assets was mainly driven by the acquisition of APP Pharmaceuticals. Current assets increased by 18 % in constant currency as well as at actual rates to € 5,078 million (December 31, 2007: € 4,291 million). Non-current assets grew by 36 % in constant currency and by 40 % at actual rates to € 15,466 million (December 31, 2007: € 11,033 million).


Shareholders' equity including minority interest increased by 12 % in constant currency and by 15 % at actual rates to € 6,943 million (December 31, 2007: € 6,059 million). The equity ratio (including minority interest) was 33.8 % (December 31, 2007: 39.5 %).


Group debt increased to € 8,787 million (December 31, 2007: € 5,699 million), mainly due to the acquisition of APP Pharmaceuticals. As of December 31, 2008, the net debt/EBITDA ratio was 3.6 (December 31, 2007: 2.6), pro forma the acquisition of APP Pharmaceuticals and excluding special items. In constant currency, the net debt/EBITDA ratio was 3.5.


The long-term acquisition financing of APP Pharmaceuticals was successfully completed in January 2009. Fresenius issued US$ 800 million unsecured Senior Notes by its subsidiary Fresenius U.S. Finance II, Inc., consisting of a Euro tranche and a US dollar tranche. Both tranches will mature in 2015. Proceeds of the Notes offering were primarily used to replace the bridge facility of US$ 650 million drawn in September 2008 to finance the acquisition of APP Pharmaceuticals.



Number of employees increased
As of December 31, 2008, Fresenius increased the number of its employees by 7 % to 122,217 (December 31, 2007: 114,181). The increase was mainly driven by Fresenius Medical Care and Fresenius Kabi due to the acquisitions of APP Pharmaceuticals and Dabur Pharma.



Fresenius Biotech
Fresenius Biotech develops innovative therapies with trifunctional antibodies for the treatment of cancer. In the field of polyclonal antibodies, Fresenius Biotech has successfully marketed ATG-Fresenius S for many years. ATG-Fresenius S is an immunosuppressive agent used to prevent and treat graft rejection following organ transplantation.

Fresenius Biotech has received a positive recommendation from EMEA's Committee for Human Medicinal Products (CHMP) for its antibody Removab® in the indication malignant ascites. Fresenius Biotech dispatched the marketing authorization application to the European Medicines Agency (EMEA) in December 2007. The approval by the European Commission is expected within a few months from the issue of the CHMP opinion. The decision will apply in all EU member states. Fresenius Biotech is prepared to launch the product shortly after approval.

Fresenius Biotech's EBIT was € -47 million in 2008 (2007: € -50 million). For 2009, Fresenius Biotech expects an EBIT of € -40 million to € -50 million.



The Business Segments


Fresenius Medical Care
Fresenius Medical Care is the world's leading provider of services and products for patients with chronic kidney failure. As of December 31, 2008, Fresenius Medical Care was treating 184,086 patients in 2,388 dialysis clinics.

• High organic sales growth of 7 % achieved
• Net income increased by 14 %
• Outlook 2009: Sales of more than US$ 11.1 billon and net income of US$ 850 to 890 million expected

Fresenius Medical Care achieved very good sales growth of 9 % to US$ 10,612 million (2007: US$ 9,720 million). Organic growth was 7 %. Currency translation effects had a positive impact of 1 %. Sales in dialysis care increased by 7 % to US$ 7,737 million (2007: US$ 7,213 million). In dialysis products sales grew by 15 % to US$ 2,875 million (2007: US$ 2,507 million).

In North America sales increased by 5 % to US$ 7,005 million (2007: US$ 6,663 million). Dialysis services revenue increased by 4 % to US$ 6,247 million. Average revenue per treatment for the U.S. clinics increased by 3 % to US$ 335 in the fourth quarter 2008 compared to US$ 325 for the same quarter in 2007. The improvement in the revenue per treatment was primarily due to increased commercial revenue rates. Sales outside North America ("International" segment) grew by 18 % (13 % in constant currency) to US$ 3,607 million (2007: US$ 3,057 million).


EBIT rose by 6 % to US$ 1,672 million (2007: US$ 1,580 million) resulting in an EBIT margin of 15.8 % (2007: 16.3 %). The margin reduction mainly reflected higher personnel expenses, and other operating and material costs, as well as lower utilization levels and reduced reimbursement rates for EPO and increased costs for the anticoagulant Heparin in North America. The margins were also influenced by a stronger growth of the dialysis services business in International coupled with start-up costs for new clinics and unfavorable currency effects. Both segments experienced higher depreciation expense in 2008 compared to 2007 as a result of the expansion of production capacities. These effects were partially offset by increases in commercial payor revenue rates, higher volumes of products sold and other operational improvements. Net income increased by 14 % to US$ 818 million (2007: US$ 717 million).


For the full year 2009, Fresenius Medical Care expects to achieve revenue of more than US$ 11.1 billion, which is more than 8 % growth in constant currency. Net income is expected to be between US$ 850 million and US$ 890 million in 2009.

For further information, please see Fresenius Medical Care's press release at www.fmc-ag.com.  


Fresenius Kabi
Fresenius Kabi offers infusion therapies, intravenously administered generic drugs and clinical nutrition for seriously and chronically ill patients in the hospital and out-patient environments. The company is also a leading provider of medical devices and transfusion technology products.

• Excellent organic sales growth of 9 %
• Outlook 2009: Sales growth of 25 - 30 % at constant currency and EBIT margin of 19.5 to 20.5 % (based on the US$/€ exchange rate from early 2009) expected

Fresenius Kabi increased sales by 23 % to € 2,495 million (2007: € 2,030 million). Organic sales growth was excellent at 9 %. Net acquisitions contributed a further 16 % to sales. This includes the acquisitions of APP Pharmaceuticals and Dabur Pharma which were both consolidated as from September 1, 2008. Currency translation effects had a negative impact of 2 %. This was mainly due to the depreciation of currencies in Great Britain, South Africa and Korea against the euro.

Organic sales growth in Europe increased by 5 % to € 1,499 million. In the Asia-Pacific region Fresenius Kabi achieved high organic sales growth of 21 % to € 381 million. Organic sales in Latin America and Africa increased by 13 % to € 279 million. Sales in North America were € 336 million.


EBIT grew by 33 % to € 443 million (2007: € 332 million). EBIT includes a € 8 million non-cash charge related to the amortization of APP intangible assets. The EBIT margin increased to 17.8 % (2007: 16.4 %). The EBIT-margin prior to any acquisition effects was 16.6 %. Net income grew by 9 % to € 200 million (2007: € 183 million).


APP Pharmaceuticals has also achieved its 2008 guidance. Sales increased by 20% to US$ 777 million (2007: US$ 647 million). Adjusted EBITDA* was US$ 317 million (2007: US$ 253 million). The integration of APP Pharmaceuticals is proceeding according to plan.


Through the acquisition of APP Pharmaceuticals, Fresenius Kabi expects to achieve revenue synergies as from 2010 by introducing selected Kabi products to the U.S., with initial focus on parenteral nutrition, and launching selected APP I.V. drugs outside the U.S. Fresenius Kabi expects to achieve € 50 to 70 million incremental annual sales by 2013.


Fresenius Kabi expects to continue its positive financial performance. For 2009, the company targets sales growth in constant currency of 25 to 30 %. Further, Fresenius Kabi forecasts an EBIT margin in the range of 19.5 to 20.5 %. Translation effects may impact Fresenius Kabi's margin as APP provides a significant earnings contribution from the US$ area. This guidance is based on the US$/€ exchange rate from early 2009.


For the mid-term, Fresenius Kabi expects organic sales growth of 8 to 10 % p.a. EBIT margin is expected to be in the 19 to 21 % range.



All special items relating to the acquisition of APP Pharmaceuticals are included in "Corporate/Other" in the segment reporting.

* Non-GAAP financial measures - Adjusted EBITDA is a defined term in the indenture governing the Contingent Value Rights (CVRs), however it is not a recognized term under GAAP.


Fresenius Helios
Fresenius Helios is one of the largest private hospital operators in Germany. The HELIOS Kliniken Group owns 62 hospitals, including five maximum care hospitals in Berlin-Buch, Erfurt, Krefeld, Schwerin and Wuppertal. HELIOS treats about 600,000 in-patients per year at its clinics and operates a total of more than 18,000 beds.

• Excellent sales and earnings growth continued
• Market position in German hospital market further expanded
• Outlook 2009: Sales of >€ 2.3 billion and EBIT in a € 180 - 200 million range expected

Fresenius Helios increased sales by 15 % to € 2,123 million (2007: € 1,841 million). Net acquisitions contributed 10 % to overall sales growth, mainly the HELIOS clinic in Krefeld. Organic growth was at a strong 5 %, driven by a significant increase in hospital admissions.

EBIT grew by 13 % to € 175 million (2007: € 155 million) due to the excellent business operations of the established clinics. The EBIT margin reached 8.2 % (2007: 8.4 %). Net income improved by 25 % to € 80 million (2007: € 64 million).

At HELIOS' established clinics, sales rose by 5 % to € 1,921 million. EBIT improved by 18 % to € 181 million. The EBIT margin increased to 9.4 % (2007: 8.4 %). The acquired clinics (consolidation <1 year) achieved sales of € 202 million and an EBIT of € -6 million.


The Mariahilf hospital in Hamburg was consolidated as from August 1, 2008. In February 2009, HELIOS successfully closed the acquisition of three hospitals in the Mansfeld-Südharz county of Saxony-Anhalt and two hospitals in the Northeim county of Lower Saxony announced in December 2008. Together, the five clinics generated total revenues of approximately € 136 million in 2007.


The outlook for the full year 2009 remains very positive. Fresenius Helios expects to achieve sales of more than € 2.3 billion. EBIT is projected to increase to € 180 to 200 million.


For 2010, Fresenius Helios projects sales of € 2.5 billion.




Fresenius Vamed
Fresenius Vamed offers engineering and services for hospitals and other health care facilities.

• Strong sales growth of 28 %
• Order intake at all-time high
• Outlook 2009: Sales and EBIT growth of 5 – 10 % expected

Fresenius Vamed achieved excellent sales growth of 28 % to € 524 million (2007: € 408 million). Acquisitions contributed 5 % whereas de-consolidations had a negative impact of 2 %. Organic sales growth was 25 %. Sales in the project business rose by 30 % to € 336 million (2007: € 259 million). Sales in the service business increased by 26 % to € 188 million (2007: € 149 million).
EBIT increased by 15 % to € 30 million (2007: € 26 million). The EBIT margin was 5.7 % (2007: 6.4 %). Net income increased by 13 % to € 26 million (2007: € 23 million).

Fresenius Vamed reported an excellent order intake and order backlog in 2008: Order intake in the project business increased by 8 % to an all-time high of € 425 million (2007: € 395 million). Order backlog increased by 12 % to € 571 million (December 31, 2007: € 510 million).


In 2009, Fresenius Vamed expects to achieve both sales and EBIT growth of 5 to 10 %.


For the mid-term, Fresenius Vamed expects to achieve organic sales growth of 5 – 10 % p.a. The EBIT margin is expected to be in a 5 to 6 % range.



Press Conference and Video Webcast

As part of the publication of the results for fiscal year 2008, a press conference will be held at the Fresenius headquarters in Bad Homburg on February 19, 2009 at 10.00 p.m. CET. You are cordially invited to follow the conference in a live broadcast over the Internet at www.fresenius.com / Press / Presentations. Following the meeting, a recording of the conference will be available as video-on-demand.





Annual Report 2008
The report for the fiscal year 2008 will be published on March 18, 2009 on our website www.fresenius.com see Investor Relations / Financial Reports.

Summary Full Year 2008:

Summary Fourth Quarter 2008:

Bad Homburg, Germany – Fresenius Medical Care AG & Co. KGaA ("the Company"), the world's largest provider of Dialysis Services and Products, today announced its results for the fourth quarter and full year of 2008.


Fourth Quarter 2008:

Revenue
Net revenue for the fourth quarter 2008 increased by 6% to $2,722 million (10% at constant currency) compared to the fourth quarter 2007. Organic revenue growth worldwide was 9%. Dialysis Services revenue grew by 7% to $1,984 million (9% at constant currency) in the fourth quarter of 2008. Dialysis Product revenue increased by 4% to $738 million (12% at constant currency) in the same period.

North American revenue increased by 9% to $1,852 million. Dialysis Services revenue grew by 7% to $1,632 million. Organic revenue growth was 6%. Average revenue per treatment for the U.S. clinics increased by 3% to $335 in the fourth quarter 2008 compared to $325 for the same quarter in 2007. The improvement in the revenue per treatment was primarily due to increased commercial revenue rates. Dialysis Product revenue increased by 22% to $220 million. This performance was led by increased sales of renal drugs, dialyzers and concentrates.

International revenue was $870 million, an increase of 1% (12% at constant currency) compared to the fourth quarter of 2007. Organic revenue growth of the international segment was 12%. Dialysis Services revenue reached $352 million, an increase of 6% (18% at constant currency). Dialysis Product revenue decreased by 3% to $518 million (an increase of 8% at constant currency), led by strong dialyzer and dialysis machine sales.



Earnings

Operating income (EBIT) increased by 1% to $433 million compared to $428 million in the fourth quarter 2007. The operating margin decreased from 16.6% in the fourth quarter of 2007 to 15.9% in the fourth quarter of 2008. This margin decrease mainly reflected higher personnel expenses, start-up costs of new clinics, increased costs for the anticoagulant drug Heparin in North America, and, in addition unfavorable foreign currency effects in the International segment. The revenue growth, supported by increased reimbursement rates and a continued above market growth rate for renal products partially offset the margin decrease.

Net interest expense for the fourth quarter 2008 was $85 million compared to $90 million in the same quarter of 2007. This positive development was mainly due to decreased interest rates and the more favorable financing structure following the redemption of a portion of the high interest carrying Trust Preferred Securities.

Income tax expense was $124 million for the fourth quarter of 2008 compared to $135 million in the fourth quarter of 2007, reflecting effective tax rates of 35.5% and 39.8%, respectively. The decrease is mainly a result of German tax reform which became effective January 1, 2008.

Net income for the fourth quarter 2008 was $214 million, an increase of 9%.

Earnings per share (EPS) for the fourth quarter of 2008 rose by 8% to $0.72 per ordinary share compared to $0.67 for the fourth quarter of 2007. Earnings per ordinary American Depository Share (ADS) are equivalent as one ADS represents one share as a result of the change in ratio of the Company's ordinary shares and preference shares to ADSs. The weighted average number of shares outstanding for the fourth quarter of 2008 was approximately 297.6 million shares compared to 296.3 million shares for the fourth quarter of 2007.


Cash Flow
In the fourth quarter of 2008, the Company generated $301 million in cash from operations, representing approximately 11% of revenue. The cash flow generation was driven by our strong earnings partially offset by an increase in working capital.

A total of $181 million was spent for capital expenditures, net of disposals. Free Cash Flow before acquisitions was $120 million compared to $126 million in the fourth quarter 2007. A total of $88 million in cash was used for acquisitions, net of divestitures.




Full Year 2008:

Revenue and Earnings
Net revenue for 2008 was $10,612 million, up 9% from 2007. In constant currency net revenue rose by 8%. Organic growth was 7% in 2008. Dialysis Services revenue grew by 7% to $7,737 million (6% at constant currency) and Dialysis Product revenue increased by 15% to $2,875 million (11% at constant currency).

North American revenue increased by 5% to $7,005 million. Dialysis Services revenue grew by 4% to $6,247 million and Dialysis Product revenue rose by 15% to $758 million. International revenue was $3,607 million, an increase of 18% (13% at constant currency). Dialysis Services revenue reached $1,490 million, an increase of 23% (18% at constant currency). Dialysis Product revenue increased by 15% to $2,117 million (10% at constant currency).

Operating income (EBIT) increased by 6% to $1,672 million compared to $1,580 million in 2007, resulting in an operating margin of 15.8% compared to 16.3% for 2007. The margin reduction mainly reflected higher personnel expenses, and other operating and material costs, as well as lower utilization levels and reduced reimbursement rates for EPO and increased costs for the anticoagulant drug Heparin in North America. The margins were also influenced by a stronger growth of the dialysis services business in International coupled with start-up costs for new clinics and unfavorable currency effects. Both segments experienced higher depreciation expense in 2008 compared to 2007 as a result of the expansion of production capacities. These effects were partially offset by increases in commercial payor revenue rates, higher volumes of products sold and other operational improvements.

Net interest expense for the full year 2008 was $336 million compared to $371 million in 2007. The reduction was mainly due to lower average interest rates associated with changes in our financing structure following the redemption of a portion of the high interest carrying Trust Preferred Securities.

Income tax expense increased to $489 million for the full year compared to $466 million in 2007 due to increased earnings. The effective tax rate for 2008 decreased to 36.6% from 38.5% for 2007 mainly due to a German corporate tax rate reduction which became effective January 1, 2008.

For the full year 2008, net income was $818 million, up 14% from 2007.

For the full year 2008, earnings per ordinary share rose by 13% to $2.75. The weighted average number of shares outstanding during 2008 was approximately 297.0 million.


Cash Flow
Cash from operations during 2008 was $1,016 million compared to $1,200 million for 2007, representing 10% of revenue. Cash Flow generation was carried by our strong earnings, partially offset by increases in the Days Sales Outstanding (DSO) and other working capital.

A total of $673 million was used for capital expenditures, net of disposals. Free Cash Flow before acquisitions for 2008 was $343 million compared to $657 million in 2007. A total of $218 million in cash was used for acquisitions, net of divestitures. Free Cash Flow after acquisitions for the full year 2008 was $125 million.

Please refer to the attachments for a complete overview on the fourth quarter and the full year of 2008.


Patients – Clinics – Treatments
As of December 31, 2008, Fresenius Medical Care treated 184,086 patients worldwide, which represents a 6% increase in patients compared to last year. North America provided dialysis treatments for 125,857 patients, an increase of 4%. Including 32 clinics managed by Fresenius Medical Care North America, the number of patients in North America was 127,539. The International segment served 58,229 patients, an increase of 11% over last year.

As of December 31, 2008, the Company operated a total of 2,388 clinics worldwide. This is comprised of 1,686 clinics in North America (1,718 including managed clinics), an increase of 5%, and 702 clinics in the International segment, an increase of 10%.

Fresenius Medical Care delivered approximately 27.87 million dialysis treatments worldwide during 2008. This represents an increase of 5% year over year. North America accounted for 19.15 million treatments, an increase of 4%, and the International segment delivered 8.72 million treatments, an increase of 9% over last year.

Employees
As of December 31, 2008, Fresenius Medical Care had 64,666 employees (full-time equivalents) worldwide compared to 61,406 employees at the end of 2007.

Dividend
The Company will continue to follow an earnings-driven dividend policy. For the twelfth consecutive year, shareholders can expect to receive an increased annual dividend for the fiscal year 2008. At the Annual General Meeting to be held on May 7, 2009, shareholders will be asked to approve a dividend of €0.58 per ordinary share, an increase of 7% from 2007 (€0.54).

Debt/EBITDA Ratio
The ratio of debt to Earnings before Interest, Taxes and Amortization (EBITDA) decreased from 2.84 at the end of 2007 to 2.69 at the end of 2008.

Rating
There have been no rating changes in the fourth quarter 2008, Standard & Poor's Ratings Services rates the Company's corporate credit rating as 'BB' with a ‘negative' outlook.

Moody's rates the Company's corporate credit rating as ‘Ba1' with a ‘stable' outlook.

Outlook for 2009
For the full year 2009, the Company expects to achieve revenue of more than $11.1 billion which is more than 8% growth in constant currency.

Net income is expected to be between $850 million and $890 million in 2009.

The Company expects to spend $550 to $650 million on capital expenditures and $200 to $300 million on acquisitions. The debt/EBITDA ratio is expected to be below 2.7 by the end of 2009.

Ben Lipps, Chief Executive Officer of Fresenius Medical Care, commented: "We are very pleased to have achieved another year of record results in 2008. With this performance we clearly achieved our guidance for 2008 and are proposing to deliver our twelfth consecutive dividend increase to our shareholders. In 2008 our company continued with investments in future growth by expanding the clinic network and production capacities as well as research and development activities. With this capacity and the continued strong demand for our high quality products and services, we expect 2009 to be another record year for the company."

Video Webcast
Fresenius Medical Care will hold a press conference at its headquarters in Bad Homburg, Germany, to discuss the results of the fourth quarter and the full year of 2008 on Thursday, February 19, 2009, at 10 am CET. The Company cordially invites journalists to view the live video webcast at the Company's website www.fmc-ag.com in the section "News and Press / Video service". A replay will be available shortly after the meeting.

Deutsche Börse announced yesterday evening that Fresenius SE will be included in the DAX 30 index on March 23.

"We are very pleased to join the DAX 30 which comprises the thirty largest publicly-traded German companies", said Ulf Mark Schneider, Chairman of the Management Board of Fresenius SE. "This decision recognizes the continuous and profitable growth of our Group. I would like to thank our associates around the world. Their significant achievements and their commitment to our firm led to this success."

With Fresenius SE and Fresenius Medical Care, two companies of the Fresenius Group will be part of the most important German stock index. Fresenius Medical Care AG & Co. KGaA, in which Fresenius SE holds a stake of about 36%, has been a member of the DAX 30 since 1999.

According to the equity index ranking of February 28, 2009, the Fresenius SE preference shares were ranked 25 by free float market capitalization and 37 by turnover. The company is currently included in the M-DAX.

Fresenius SE is a global health care group with four business segments: Fresenius Medical Care is the world's leading provider of products and services for patients with chronic kidney failure. Fresenius Kabi is focused on generic I.V. drugs, infusion therapy and clinical nutrition. Fresenius Helios is a leading German private hospital operator and Fresenius Vamed offers engineering and services for hospitals and other health care facilities.

Over the last ten years, Fresenius developed dynamically: Sales have almost tripled from approximately EUR 4.3 billion in 1998 to EUR 12.3 billion in 2008. Over the same period, operating income (EBIT) has increased from EUR 484 million to EUR 1,727 million (before special items). Today, Fresenius employs more than 122,000 employees worldwide. Approximately 37,000 work in Germany.

For 2009, Fresenius projects further improvements in its financial results: Group sales are expected to grow by more than 10 % in constant currency and adjusted net income^* is expected to increase by approximately 10 % in constant currency.

^{* before special items relating to the mark-to-market accounting of both the mandatory exchangeable bonds (MEB) and the contingent value rights (CVR).}