THE CORPORATE LIBRARY

Related Party Transactions and Outside Related Director Information

Valeant Pharmaceuticals International (VRX)

4/21/2006 Proxy Information

On October 1, 2002, several former and current directors of the Company, as individuals, as well as the Company, as a nominal defendant, were named as defendants in a stockholders’ derivative complaint filed in Delaware Chancery Court. The complaint sought, among other things, recovery of the bonuses paid to directors and officers in connection with the initial public offering of Ribapharm (the “Ribapharm Bonuses”). The Special Litigation Committee of the Board of Directors determined to proceed with the claims against the named director defendants related to the Ribapharm Bonuses. For further information regarding this legal proceeding, see the Company’s most recent Annual Report on Form 10-K filed with the SEC.

Director Edward A. Burkhardt has entered into a settlement agreement, as amended, whereby he forfeited his 2003 annual stipend and his restricted stock units in exchange for a release from further liability in the lawsuit. The settlement will not be effective unless approved by the Delaware Chancery Court.

The Director of Consumer Markets for the Company, Richard Cunningham, is Mr. O’Leary’s son-in-law. As Director of Consumer Markets, Mr. Cunningham earned approximately $214,852 in salary and bonus in 2005. In addition, in 2005 Mr. Cunningham received 4,000 stock options granted at the fair market value at date of grant price of $17.72.

4/22/2005 Proxy Information

On October 1, 2002, several former and current directors of the Company, as individuals, as well as the Company, as a nominal defendant, were named as defendants in a stockholders’ derivative complaint filed in Delaware Chancery Court. The complaint sought, among other things, recovery of the bonuses paid to directors and officers in connection with the initial public offering of Ribapharm (the “Ribapharm Bonuses”). The Special Litigation Committee of the Board of Directors determined to proceed with the claims against the named director defendants related to the Ribapharm Bonuses. For further information regarding this legal proceeding, see the most recent Form 10-K filed with the SEC.

Director Edward A. Burkhardt has entered into a settlement agreement, as amended, whereby he forfeited his 2003 annual stipend and his restricted stock units in exchange for a release from further liability in the lawsuit. The settlement will not be effective unless approved by the Delaware Chancery Court.

The Director of Consumer Markets for the Company, Richard Cunningham, is Mr. O’Leary’s son-in-law. As Director of Consumer Markets, Mr. Cunningham earned approximately $150,759 in salary and bonus. In addition, Mr. Cunningham received relocation expenses in the amount of $12,364. He also received 10,000 stock options granted at the fair market value at date of grant price of $23.92.

4/20/2004 Proxy Information

Coudert Brothers, LLP, a law firm of which Gregory Keever is a member, billed the Company for legal fees of approximately $5,804,230 in 2003. Mr. Keever was employed with the Company as its Executive Vice President and Special Counsel to the Chairman until October 15, 2003 and did not participate in the profits of the law firm during his employment at the Company.

On October 1, 2002, several former and current directors of the Company, as individuals, as well as the Company, as a nominal defendant, were named as defendants in a shareholders’ derivative complaint filed in Delaware Chancery Court. The complaint sought, among other things, recovery of the bonuses paid to directors and officers in connection with the initial public offering of Ribapharm (the “Ribapharm Bonuses”). The Special Litigation Committee of the Board of Directors determined to proceed with the claims against the named director defendants related to the Ribapharm Bonuses. For further information regarding this legal proceeding, see the most recent Form 10-K filed with the SEC.

Directors Edward A. Burkhardt, Ronald R. Fogleman and Steven J. Lee have entered into settlement agreements, as amended, whereby they forfeit their 2003 annual stipend and all of their restricted stock units in exchange for a release from further liability in the lawsuit. The settlement will not be effective unless approved by the Delaware Chancery Court.

The Director of Consumer Markets, Richard Cunningham, is Mr. O’Leary’s son-in-law. As Director of Consumer Markets, Mr. Cunningham earned approximately $124,000 in salary, bonus and auto allowance. In addition, Mr. Cunningham received relocation expenses in the amount of $48,573. He also received 20,000 stock options granted at fair market value with a weighted-average price of $13.99.

4/25/2003 Proxy Information

Coudert Brothers, LLP, a law firm of which our Executive Vice President, General Counsel and Corporate Secretary, Gregory Keever, is a member, billed the Company for legal fees of approximately $7,192,300 in 2002. Mr. Keever has not participated in the profits of the law firm during his employment at the Company.

CERTAIN INDEBTEDNESS OF FORMER EXECUTIVE OFFICERS AND OTHER TRANSACTIONS

In June 1996, the Company made a short-term loan to Mr. Panic, the Company’s Chairman and Chief Executive Officer, in the amount of $3,500,000 for obligations arising from the settlement by the Company and Mr. Panic of litigation to which Mr. Panic and the Company were parties. This litigation involved a claim by a former employee of the Company of alleged sexual harassment against her by Mr. Panic and the Company. During August 1996, this amount was repaid to the Company. In connection with this transaction, the Company guaranteed $3,600,000 of demand debt of Mr. Panic (the “1996 Loan”) with a third party bank (the “Bank”), which was renewable by Mr. Panic annually until repaid. In addition to the guarantee, the Company deposited $3,600,000 with the Bank as collateral (the “Company Collateral”) for the guarantee. Interest paid by the Company to the Bank on Mr. Panic’s behalf was charged to him as compensation expense and amounted to $126,223, $150,755 and $160,916 for the years ended December 31, 2002, 2001 and 2000, respectively. The Company recognized interest income on the Company Collateral of $87,248, $109,511 and $124,330 for the years ended December 31, 2002, 2001 and 2000, respectively. Mr. Panic provided collateral (the “Panic Collateral”) to the Company in the form of rights to the proceeds of the exercise of options to acquire 150,000 shares of Common Stock with an exercise price of $15.17 per share and the rights to a split dollar insurance agreement between the Company and Mr. Panic with a current death benefit of $6,400,000. The options and the split dollar insurance agreement were granted to Mr. Panic in connection with these arrangements. In the event of any default on the 1996 Loan to the Bank by Mr. Panic and enforcement by the Bank of the Company’s guarantee, the Company has recourse to assets that is limited to the Panic Collateral. The transaction, the sufficiency of the Panic Collateral for the guarantee and the grant of the Panic Collateral to Mr. Panic were approved in 1996 by the Board of Directors.

Mr. Panic resigned as Chairman and Chief Executive Officer of Company effective June 18, 2002. As described above, the election of directors at the 2002 and 2001 Annual Meetings of Stockholders resulted in a Change in Control under the Company’s Option Plan. As a result, all nonqualifed Options then outstanding became eligible for surrender for a cash payment equal to the difference between the per share option exercise price and $32.50 per share, reflecting the highest closing price for the Common Stock on the New York Stock Exchange during the 90 days preceding the Change in Control. On March 6, 2003, the Company and Mr. Panic reached a settlement on Mr. Panic’s severance arrangements pursuant to a Closing Agreement (the “Closing Agreement”). In connection with this settlement, the Company remitted the Company Collateral to the Bank in satisfaction of its guarantee of the 1996 Loan, and Mr. Panic surrendered all rights to proceeds in the amount of $2,600,000 ($1,704,000 net of withholding tax) from the surrender (in accordance with the terms of the Option Plan) of the options included in the Panic Collateral. In addition, Mr. Panic surrendered all rights to the cash surrender value of the life insurance policy described above. The Company will make no further claims against Mr. Panic in relation to this matter. The difference between the value of the assets surrendered by Mr. Panic and the Company Collateral, which totaled $1,896,000, was included as part of the severance accrued for Mr. Panic at December 31, 2002.

In January 2001, the Company made a loan to Mr. Adam Jerney, President and Chief Operating Officer of the Company, of $1,197,864 as part of a program adopted by the Board of Directors of the Company to encourage directors and officers of the Company to exercise stock options (the “Stock Option Program”). The loan was collateralized by 41,427 shares of Common Stock and due in January 2003. This loan was repaid in full in April 2002. This loan had an interest rate of 5.61% per annum and was non-recourse with respect to principal and full recourse to Mr. Jerney with respect to interest. In April 2001, the Company made a loan to Mr. Panic of $2,731,519 as part of the Stock Option Program. The loan is collateralized by 286,879 shares of Common Stock and is due in April 2004. This loan bears interest at a rate of 4.63% per annum compounded annually. Interest is payable annually. This loan is non-recourse with respect to principal and full recourse to Mr. Panic with respect to interest.

In January of 2002, Mr. Panic surrendered 197,409 stock options with an exercise price of $17.99 per share, and 169,578 stock options with an exercise price of $26.24 per share, for 99,291 shares of Common Stock. The Company recorded a compensation expense as a result of these surrenders, which is reflected in Mr. Panic’s compensation presented in the Summary Compensation Table set forth above. The Company made a $1,335,833 short-term loan to Mr. Panic in connection with these option surrenders and the vesting of an LTIP award. This loan was repaid in full in April 2002. This loan had an interest rate of 2.8% per annum payable annually.