1

Arrow International, Inc.Investor Presentation

UBS Global Life Sciences Conference

September 26, 2006

2

“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995: The statements contained in the following projections

that are not historical facts are forward-looking statements (including projections) and involve risks and uncertainties. Although the Company

believes that the expectations in such forward-looking statements are reasonable, the Company can give no assurance that such

expectations will prove to have been correct. The forward-looking statements are based upon a number of assumptions and estimates that,

while presented with numerical specificity and considered reasonable by the Company, are inherently subject to significant business,

economic and competitive risks, uncertainties and contingencies which are beyond the control of the Company, and upon assumptions with

respect to future business decisions which are subject to change. Accordingly, the forward-looking statements are only an estimate, and

actual results will vary from the forward-looking statements and these variations may be material. Consequently, the inclusion of the forward-

looking statements should not be regarded as a representation by the Company of results that actually will be achieved. Forward-looking

statements are necessarily speculative in nature, and it is usually the case that one or more of the assumptions in the forward-looking

statements do not materialize. Investors are cautioned not to place undue reliance on the forward-looking statements. In connection with the

“Safe Harbor” provisions of the Private Securities Litigation Reform Act of 1995, the Company cautions the reader that, among others, the

factors below, which are discussed in the Company’s Annual Report on Form 10-K for the fiscal year ended August 31, 2005 and in its other

filings with the Securities and Exchange Commission, could cause the Company’s results to differ materially from those stated in the forward-

looking statements. These factors include: (i) stringent regulation of the Company’s products by the U.S. Food and Drug Administration and,

in some jurisdictions, by state, local and foreign governmental authorities; (ii) the highly competitive market for medical devices and the rapid

pace of product development and technological change in this market; (iii) pressures imposed by the health care industry to reduce the cost

or usage of medical products and services; (iv) dependence on patents and proprietary rights to protect the Company’s trade secrets and

technology, and the need for litigation to enforce or defend these rights; (v) risks associated with the Company’s international operations; (vi)

potential product liability risks inherent in the design, manufacture and marketing of medical devices; (vii) risks relating to interruptions in the

supply of or increases in the price of essential raw materials or components; (viii) risks associated with the Company’s use of derivative

financial instruments; and (ix) dependence on key members of the Company’s management.

Safe Harbor Statement

3

Agenda

Mission, Goals & Company Profile

Strategies for Growth

Product Launches

Key Products

Historical Financial Performance

Summary & Investment Considerations

4

Mission and Goals

MissionDevelop and market innovative medical devices that uniquely meet the clinical requirements of physicians and improve patient care.Continued focus on Critical Care and Cardiac Care market segments.

GoalsGenerate revenue growth of 10 - 12% per year.Increase gross margins to 55% of sales.Invest 6 - 7% of sales in research and development.Continue to deliver operating income of 20 - 21% of sales.

5

Company Profile

9 months FY ’06 Revenue.................. …$352.4 million 9 months FY’ 06 Diluted EPS............................... $0.85 9 months FY’ 06 Cash From Operations....$46 million

Balance Sheet...................................No long term debt Domestic Employees........................................ …1,600 International Employees.......................................2,400 Headquarters and R&D............................ Reading, PA

Domestic Manufacturing ............................ 5 Facilities International Manufacturing..……. 2 Czech, 3 Mexico

Note: Full fiscal year 2006 financial results will be released on October 4, 2006

6

Investment Considerations

Global brand franchise based on product superioritySignificant opportunity for future growthProven technological capabilitiesGrowing marketing competenceStrong financial position

7

Product and Geographic Sales

Cardiac Care15%

Specialty Catheters

32%

Central Venous

Catheters51%

Non-Arrow Distributed Products

2%

Sales by Product Platform

May 31, 2006

Sales by Geographic Region

May 31, 2006

Europe19%

United States61%

Asia / International

20%

Note: Sales for 12 months ended May 31, 2006 were $466.7 million. Fiscal year ended August 31, 2006.

8

Markets

Critical CareAnesthesiaSurgeryIntensive Care UnitsInterventional RadiologyHemodialysis UnitsEmergency Room

Cardiac CareCardiac SurgeryInterventional CardiologyHeart Failure Cardiology

9

Global Market OpportunityCritical Care Market

Market* Arrow($Mil) Share

Central Venous Catheters 465 50%CV Access 240 74%Peripheral AccessRenal Access

Specialty Catheters 460 30%Regional Anesthesia Interventional ProceduresHemodynamic MonitoringIV TubingSpecial Procedures

*based upon Arrow’s estimates of worldwide market

10

Global Market OpportunityCardiac Care Market

Market* Arrow($Mil) Share

Cardiac Care 490 14%Intra-aortic Balloons & Pumps 185 23%Super Arrow-Flex® PSIThermodilution CathetersRight Heart Procedures

*based upon Arrow’s estimates of worldwide market

11

Competitors

Central Venous AccessBardCookEdwards

Peripheral AccessBardBoston ScientificAngioDynamicsBecton Dickinson

Renal AccessBardMedcompAngioDynamics

Specialty CathetersCookBoston ScientificB. BraunBardEdwards

Cardiac AssistDatascope

Other Cardiac B. Braun Boston ScientificCook Edwards

12

U.S. Sales Force

U.S. Sales Force 170

Sales Representatives 96Specialists 33Management 16Clinical Support 12Service 7Trainers 6 Direct Sales

94%

Dealers6%

13

International Sales Structure

Direct Sales (16 markets)Japan GermanyCanada FranceSouth Africa SpainMexico HollandGreece CzechItaly SlovakiaSwitzerland AustriaUnited Kingdom Portugal

International Sales Force160 Direct Sales Representatives Dealers in 97 countries

Direct Sales70%

Dealers30%

14

STRATEGIES FOR GROWTH

15

Strengthening the Infrastructure

Operational Objectives

Deliver highest quality products to our physician customers and their patients

Maintain a safe working environment for our employees

Provide our hospital customers with superior service

Maintain or achieve low cost producer status in each of our major product categories

16

Executing on Programs for Growth FY ’05 & ’06

√ Completed manufacturing capacity expansion projects

• Chihuahua, Mexico • Zdar, Czech

√ Upgraded quality system to ensure global regulatory compliance

√ Increased investment in core business research and development

√ Strengthened marketing and sales capabilities

√ Established Strategic Sourcing presence in Shanghai, China

17

Strengthened the Operational Infrastructure

Progress to date:Competitive manufacturing infrastructure supporting regionalized manufacturing

• Production capacity to meet demand• Production facilities aligned with geographical

marketsUpgrading production technology to increase efficiency, effectiveness and gross margin Embedding Quality System procedures into corporate cultureRefocusing R&D personnel on global opportunities

18

Recent Results

Improvement in quality metrics – significant reduction in scrap and re-work system-wide

Record high rates of line fill (+90%) and record low levels of backorders

Manufacturing overtime substantially reduced

Sales force turnover returned to normal levels

Launching Product Upgrades and New Products

19

New Products

20

AutoCAT®2WAVE™ with FiberOptix™ SensorIntra Aortic Balloon Pump- Proactively anticipates aortic valve (AV) closures before they occur- Even during severe arrhythmias. - Unique combination of: - Aortic flow timing- FiberOptix™ sensor technology- Proprietary WAVE® algorithmImproves timing and triggering accuracy, to optimize and simplify IABP management.

Benefits:Improved patient support Simplified use for clinicianUpgrading of conventional pumpsReplacement of traditional fluid filled catheter technology

21

Introducing ProActive CounterPulsation™A New Breakthrough in Intra Aortic Balloon Pump Therapy

No one else can offer ProActiveCounterPulsation™

-Journal Ads will carry this message

22

The Arrow Pressure Injectable PICC KitMarket Estimate $125 - $150 Million

The following picture demonstrates Arrow’s peripherally inserted central catheter (PICC)

23

The Arrow Pressure Injectable PICC Kit Key Differentiators

CatheterBlue FlexTip®

Designed to be less traumatic to vesselDesigned to track better over wireProvides visual confirmation of entire catheter removal

Non-tapered designArrow’s stated 5 French size does not vary between tip and proximal end

Other Infection Protection and Safety ComponentsLarge Procedural DrapeBIOPATCH®ChloraPrep®StatLock®SharpsAway II™ Locking Disposal CupSafety scalpelSafetyGlide® Needles

24

Strategies for Growth

Continue to grow market share in Core BusinessCentral Venous AccessDialysis AccessRegional AnesthesiaHemodynamic MonitoringIntra-Aortic Balloon Pumping

Develop or acquire new products which complement core business and can add sales in one year or lessContinue improving marketing and sales effectivenessExplore new technologies and markets

25

Key Products

26

Maximal Barrier Precautions Tray

It is easier to comply with the latest guidelines from CDC, OSHA and the Institute for Healthcare Improvement's 100,000 Lives Campaign, thanks to this one-of-a-kind catheter kit.

27

Specialty CathetersGlobal market opportunity $460 million

Percutaneous Thrombolitic Device PTD TM

Radial Artery Catheter

28

Cannon™ II Plus CatheterMarket Estimate $75-100 million

A unique chronic dialysis catheterTwo-piece configuration allows tip-first placementSplit-tip design allows better circulation of cleansed blood

29

StimuCath™

Market Estimate $25-30 million

Targeted pain management for surgical proceduresThe catheter is tunneled beneath the skin.The catheter tip is placed near a nerve to allow the infusion of pain management drugsConventional catheters are placed without the ability to guarantee proper catheter tip locationCatheter and needle provide an electronically-conductive tip for accurate placement

30

Historical Financial Performance

31

Gross Margin & Operating Income

0.0%10.0%20.0%30.0%40.0%50.0%60.0%

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006*

Fiscal Year

Gross Margin %Operating Income as a % of SalesTarget Gross Margin %Target Operating Income %

* Nine months ended May 31, 2006

32

Annual Sales Growth by Product Line(Dollars in millions)

1996 1997 1998 1999 2000 2001 2002 2003 2004 200519950

50

100

150

200

250

300

350

400

450

500

8% 7% 6% 13% 9% 3% 2% 12% 14% 5%

CARDIAC CARE

CRITICAL CARE

Percent Growth over Previous Fiscal Year(Dollars in millions)

33

Annual History of Cash Flows From Operations (Dollars in millions)

1997 1998 1999 2000 2001 2002 2003 2004 200519960

10

20

30

40

50

60

70

80

90

100

9.1% 4.4% 24.0% 39.0% 0.2% -26.3% 86.0% 1.1% 17.3% -14.4%

Percent Growth over Previous Fiscal Year(Dollars in millions)

34

$0.0475 $0.0575 $0.0675 $0.0775 $0.0875 $0.0975 $0.1075 $0.1175 $0.1275 $0.1375 $0.1975 $0.35 $0.54 $0.66

Dividend Payment History

Dividends paid every quarter (56) since the Company’s IPO on June 9, 1992 Dividends have increased every year since 1993 Current annual dividend of $0.68 per share is a dividendyield of 2.1%

1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

35

Annual History of Return on Shareholders’ Equity

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

20%

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

% Return on Average Shareholders' Equity % Target Return on Average Shareholders' Equity

Fiscal Year

36

Summary & Investment Considerations

Global brand franchise based on product superioritySignificant opportunity for future growthProven technological capabilitiesGrowing marketing competenceStrong financial position

37

Arrow International, Inc..

In thousands, except per share amounts (Unaudited)

Three Months Ended Nine Months Ended

Consolidated Statements Of Operations:

May 31, 2006

May 31, 2005

May 31 , 2006

May 31, 2005

Net sales $ 122,257 $ 118,070 $ 352,405 $ 340,004Cost of goods sold 63,023 57,416 180,225 170,344Early Retirement Plan Charges - - - 1,883Gross Profit 59,234 60,654 172,180 167,777Operating expenses:

Research and development 7,199 6,623 20,708 21,668Selling, general and administrative 32,602 29,856 97,081 89,167Early Retirement Plan Charges - - - 4,956Restructuring charge 130 450 (126) 1,771

Total operating expenses 39,931 36,929 117,663 117,562 Operating income 19,303 23,725 54,517 50,215Interest, net (912) (273) (2,059) (470)Other (income) expenses, net (219) 540 (101) 266 Income before income taxes 20,434 23,458 56,677 50,419Provision for income taxes 6,535 7,624 18,314 15,948 Net income $ 13,899 $ 15,834 $ 38,363 $ 34,471

Basic earnings per common share $0.31 $0.36 $0.86 $0.78Diluted earnings per common share $0.31 $0.35 $0.85 $0.77

Weighted average shares used in computing basic earnings per common share 44,810 44,548 44,729 44,200

Weighted average shares used in computing diluted earnings per common share 45,281 45,277 45,242 44,939

38

Balance Sheets(Dollars in millions)

5/31/2006 8/31/2005Assets

Cash $130.8 $119.3Marketable Securities 2.5 -Receivables (net) 91.8 91.0Inventories 101.9 95.4Prepaid expenses and other 25.9 24.7

Total current assets 352.9 330.4

Property, plant and equipment (net) 166.6 152.2Other Assets 124.4 117.8

Total assets $643.9 $600.4

LiabilitiesNotes payable $51.3 $26.9Other current liabilities 61.0 63.9Current maturities of long-term debt 1.0 1.1Other liabilities 24.5 30.0

Shareholders' Equity 506.1 478.5Total liabilities and shareholder's equity $643.9 $600.4

39

Condensed Cash Flow Statement(In thousands)

5/31/2006 5/31/2005

Net Income 38,363 34,471

Depreciation and Amortization 19,835 19,016 Net changes in working capital (15,444) (16,261) Other operating cash flows, net 3,577 17,517

Net Cash Flow from operations 46,331 54,743

Capital Expenditures (30,784) (26,810) Other investing cash flows (10,198) (8,371)

Net Cash Flows from Investing Activities (40,982) (35,181)

Dividends Paid (21,007) (14,568) Other financing cash flows 26,302 10,478

Net Cash Flows from Financing Activities 5,295 (4,090)

Effects of exchange rate changes on cash 828 (278)

Net change in cash 11,472 15,194

Cash at beginning of period 119,326 94,176

Cash at end of period 130,798 109,370

40

Arrow International, Inc.

Thank You

September 26, 2006