Among the capital expenditures carried out at Group level a warehouse expansion at the Russian manufacturing unit as well as
a laboratory and a pilot plant capable to run R&D projects requiring isolated conditions at our Romanian subsidiary were the most noteworthy developments during 2008.

In line with the strategic goal of improving its share of high intellectual value intensive production and taking advantage of a sound knowledge in the field of large scale fermentation procedures the Company decided to enter into the development of biosimilar research and manufacturing capacities. Following the acquisition in 2007 in Germany of a manufacturing unit dedicated towards the development of bacterial fermentation together with a related pilot plant and laboratory, Richter announced in 2008 a greenfield investment to be carried out in the Hungarian city of Debrecen aimed at the manufacturing of biosimilar products by means of mammalian cell fermentation. Related small scale fermentation units were completed during 2008 in Budapest, while the laboratory is expected to be completed during the second half of 2009. The construction of the manufacturing plant commenced in late 2008 in Debrecen. The plant is expected to be operational in 2012.

As indicated by the cash flow statement, during 2008 the Group generated net cash from operating activities of HUF 42,417 million (EUR 168.9 million). This lower level of cash from operating activities when compared with the previous year was more than offset by improving cash flow originating from financing activities. Albeit below their 2007 levels, important amounts of cash were directed towards capital expenditure and payment of dividends. Overall, cash increased by HUF 7,625 million in 2008.