1.
Trending or here to stay?
The impact of innovation on the
future of in vitro diagnostics (IVD)
Kristin Pothier, Head of Life Sciences
Parthenon-EY
27 July 2015

2.
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M&A environment for global IVD/LS tools: annually
M&A activity in 2014 was dynamic, with more IVD transactions compared to the
previous two years combined; 2015 is on par with 2014 to date
0
10
20
30
40
50
60
70
80
90
2010 2011 2012 2013 2014 2015E*
NumberofM&Atransactions
Historical transactions
Forecast transactions (based on H1:15)
2010 2011 2012 2013 2014 2015*
Total transaction
value (US$b)^ US$10.2 US$17.5 US$7.6 US$18.4 US$25.8 US$5.5
Example
transactions
(Alphabetical)
► Clarient (GE)
► EMD Millipore
(Merck KGaA)
► Ion Torrent (Life
Technologies)
► Axis-Shield
(Alere)
► Beckman
Coulter
(Danaher)
► Phadia (Thermo
Fisher)
► BlueGnome
(Illumina)
► Dako (Agilent)
► Gen-Probe
(Hologic)
► IRIS (Danaher)
► BioFire
(bioMerieux)
► Ingenuity
Systems
(QIAGEN)
► Life
Technologies
(Thermo Fisher)
► Crescendo
(Myriad)
► OCD (Carlyle)
► Siemens Micro.
(Danaher)
► BRLI (OPKO)
► Foundation
Medicine
(Roche)
Worldwide IVD transactions (instrument/reagent manufacturers, genome informatics and reference labs), 2010-15
Sources: EY analysis, Capital IQ. *Includes transactions in H1:15 ^Note: transaction values available for 54% of total transactions

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Global medtech financial environment
The EY Medtech Firepower Index has grown steadily since 2011, indicating high
borrowing capacity and the potential for future transaction execution
Firepower (and change) of large-cap medtech* companies (US$10b market cap as of 17 July 2015)
Sources: Capital IQ, EY analysis. *Large-cap medtech includes N=26 medtech companies with 17 July 2015 market values >US$10b; does not include Baxter due to change in
valuation following major divestitures in 2014-15.
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
0
50
100
150
200
250
2007 2008 2009 2010 2011 2012 2013 2014 2015
Large-capmedtechfirepower(US$b)
Firepower Change in firepower
EY Firepower
► A company’s ability to do M&A based on the strength of its balance sheet
► Market capitalization, cash equivalents and debt capacity provide this firepower

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Global IVD partnership environment: key trends
The diagnostics market has seen an emergence of creative deal making between
nontraditional partners specifically within oncology, NIPT and MRSA
Sources: Company press releases, GenomeWeb, Capital IQ, Cowen, Forbes, Fierce Biotech. *Flatiron acquired Altos outright.
3 key trends in
2014-15 IVD
partnerships
Deals were largely focused in
oncology, NIPT and infectious
disease (including MRSA)
Some deals incorporated multiple
pharma companies with the same
IVD partner
Nontraditional stakeholders are
starting to become more involved

5.
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International perspective: M&A environment
Deal activity in 2015 is comparable to 2014; however, there has been a sharp
decline in acquisitions in China
Sources: EY analysis, Capital IQ. *Includes transactions in H1:15 (n=40); Other includes Latin America, Middle East and Africa.
Worldwide IVD transactions by target company headquarters, Jan 2010-Jun 2015
0
10
20
30
40
50
60
70
80
90
2010 2011 2012 2013 2014 2015*
NumberofM&Atransactions
Europe United States and Canada Asia/Pacific Other

6.
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International Firepower Index
The Firepower Index grew across all regions from 2013-15, but the proportion of
firepower is growing in emerging markets (BRIC) at the expense of the US.
Medtech firepower by country/region (2011-15)
Sources: Capital IQ, EY analysis. Index includes N=325 medtech companies across select geographies
EY Firepower
► A company’s ability to do M&A based on the strength of its balance sheet
► Market capitalization, cash equivalents and debt capacity provide this firepower
61%
56%
18%
20%
6% 9%
9% 8%
5% 5%
0
50
100
150
200
250
300
350
400
450
500
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2011 2012 2013 2014 2015
Globalmedtechfirepower(US$b)
US/CAN EU BRIC JP APAC EMEA LATAM Total global firepower

7.
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For more information:
Kristin Pothier, Head of Life Sciences
Kristin Ciriello Pothier
Partner and Managing Director
Parthenon-EY
Tel: +1 617 375 1384/+1 617 549 2779 (Mobile)
Email: kristin.pothier@ey.com
Education
► Kristin earned a BA in Biochemistry from Smith College and an MS in Epidemiology,
Health Management, and Maternal and Child Health from the Harvard School of
Public Health
Areas of focus
► Kristin has extensive experience in commercial and clinical strategy and due
diligence for both strategics and investors
► Core areas of focus include commercial and operational strategy and M&A diligence
in the clinical core laboratory, molecular diagnostics, life sciences tools and
services, reference lab strategy, point of care, and personalized medicine from a
diagnostics and a pharmaceutical perspective
► Kristin serves clients in all sectors of the global life sciences industry including
► Pharmaceutical and precision/personalized medicine access strategy
► Core clinical diagnostics and innovative diagnostics, including molecular, POC
and NGS
► Reference lab strategy including hospital lab, global core reference labs,
specialty labs, anatomical pathology, clinical trials, and personalized medicine
► Life sciences tools and lab services, including sample prep, biorepositories, MS,
sequencing and translational platforms
► Health IT strategies, including middleware development, digital pathology
incorporation, biomarker algorithms and patient journey development, for
institutions and companies
► Extensive clinical knowledge in oncology, cardiovascular, global health, prenatal
and infectious disease across the globe
EY experience
► Kristin has 20 years of experience in the life sciences industry
► Kristin leads the life sciences sector of Parthenon-EY serving clients in pharma,
biotech, diagnostics and life science tools, with a focus on company and investor
commercial strategy and M&A support for diagnostics, life science research and
pharmaceutical companies
► She is also the creator and leader of EY Precision Medicine™, and specializes in
diagnostics clinical laboratories, the developing platform and reference lab
strategies worldwide with on-the-ground experience in North America, South
America, EU, Asia and the Caribbean
► Kristin is a co-founder and leader of DxInsights, a nonprofit organization
designed to educate on the impact of diagnostics and precision medicine in
improving health care outcomes to the nation's health care communities
► Kristin is a noted speaker, workshop leader and writer with a strong industry
following. She develops numerous publications and delivers speaking
engagements at the most prolific industry meetings and symposia
Previous professional experience
► Prior to EY, Kristin was a partner and owner of Health Advances, where she
owned and managed the firm with four other partners. She developed and led
the Diagnostics and Life Sciences practice, a global practice focused on product
and service strategy, corporate strategy, health economics and deal diligence
► Kristin is also a founder of DxInsights, a nonprofit organization designed to
educate the nation's health care communities on the impact of diagnostics in
improving health care outcomes
► Earlier in her career, Kristin was a research scientist at Genome Therapeutics, at
the time the only commercial entity sequencing for the Human Genome Project,
and at Genzyme, as part of the technology development team developing
prenatal and cancer diagnostics for the Genzyme Genetics clinical laboratory

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Parthenon-EY Life Sciences Strategy Services
We are global strategy consultants with focus on commercial and growth strategy
across the life sciences continuum
Commercial brand strategyGrowth strategy
DiligencePipeline strategy
Proprietary databases | Global primary research | Dedicated life sciences teams | Life sciences thought leadership
Life Sciences
Strategy Services
► Portfolio optimization
► Acquisition target identification
► Early-stage asset development strategy
► Market opportunity assessment
► Commercial launch strategy
► Market development strategy
and execution
► Focused, issues-based
commercial diligence
► Forecast achievability
Regional Variations Necessitate Diverse Testing and Partner
Options
• LDTs
• Sample exchange
• Cepheid V1
• Genoptix
• LDTs
• Ipsogen
• ELITech
• Cepheid V1
• Cepheid V1
• Ipsogen
• Asuragen
• Genoptix
• MMD
• LDTs
• Ipsogen
• LDTs
• Sample exchange
FM Patient Flow: Pre-Presentation to Treatment
FM
Society
Presents to
Physician Diagnosed
with FM -
12%
Treatment -
78%
204K 159K
FM Suff
1.7M
Specialist*
Internist
&
Ortho
Tx
Diagnosing
Cycling
FM not fully
understood
Refer to Alt.
HCP
Suspicion of
Alt. Conditions
Inappropriate
Tx
Referred to
Alt. HCP
Switch HCPDrops Out
System
Symptoms
not
ControlledCycling
Alt. Tx / OTC
Pain
Persists
Research
Symptoms
Suspicion of
Condition
Patient Actions
Physician Actions
Patient Actions
Hospital
or
Clinic
From Patient Perspective
From Physician Perspective
Market Overview & Competitive Landscape
Target competes both with basic “do-all” labs, as well as other
small independents with similar test offerings.
Basic “Do-all” Labs Esoteric Hospital /
Academic Labs
Small Independents and
Local Hospitals
Highly Specialized Labs
Volume&DiversityofTests
Scientific Expertise & Capabilities
Competitive Landscape Key Segments
► Basic “Do-all” Labs
– Offer test menu of >1,000 tests, with
revenue and volume focused on routine
tests.
– Serve as reference labs for institutions with
no or limited lab capabilities.
– Largest players, however, are increasing
focus on esoteric tests (e.g., LabCorp ,
Quest).
► Esoteric Hospital / Academic Labs
– Offer >1,000 tests, with core business
focused on highly complex esoteric tests.
– Also serve as reference laboratories for
smaller institutions.
► Highly Specialized Labs
– Typically focus on a low to moderate
number of esoteric tests requiring scientific
expertise.
– May be focused on one specific therapeutic
area (e.g., Myriad in oncology).
► Small Independents and Local Hospitals
– Includes small independent labs with
limited menus of tests and local hospital
labs that only do routine tests and send out
more complex tests.
Target
Primary Competition

9.
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1508-1599827
EYG No. FN0225
ED None
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