Healthcare & Life Sciences Industry Update December 2013 Member FINRA/SIPC

www.harriswilliams.com

What We’ve Been Reading December 2013

•

MedCity News published a question and answer session with Elliot Hyun, Senior VP at GE Capital, focused on the outlook for the medical device industry. The piece addresses a number of topics including the impact of healthcare reform, growth and pricing headwinds, regulatory challenges, and general investor sentiment. From an M&A perspective, the piece suggests that device companies will be actively looking to augment slowing growth in their core businesses through acquisitions and partnerships into adjacent areas. You can find the article here. (a free registration to MedCity News may be required)

•

The Wall Street Journal published an article that discusses an often ignored, but significant, cost of health insurance for individuals: the plan deductible. As enrollment on the HealthCare.gov website (the much-maligned online portal for purchasing health insurance policies) is starting to grow, many Americans are finding that many of the plans include a significant deductible in addition to the premium. The average premium for a “bronze” plan, the lowest-premium level plan available on the exchange, is over $5,000 per year (40% higher than the average premium of individually purchased plans prior to the launch of HealthCare.gov). As a result, many new enrollees into health insurance are finding that they may still be paying a significant portion of their health expenses out of pocket despite being covered by insurance. (a registration to The Wall Street Journal Online may be required)

•

While recent media and political focus has been mostly on the aspects of Obamacare and healthcare reform addressing inadequate healthcare access for Americans, a key driver of rising healthcare expenditures has been ignored: overutilization. According to an article in The Atlantic, 42% of American primary care physicians said in a survey that their patients were receiving more medical care than necessary. In addition, an estimate from the Institute of Medicine estimates that 30% of total healthcare expenditures in the U.S. go toward unneeded care.

1

HW&Co. HCLS Group Insight December 2013

Home Health Market Overview

2

Equity Trading Overview December 2013 Average

Number of Enterprise Companies Value ($ mm)

Payer, Provider, & Pharmacy Support Services

Sector

Provider-Based Services

Products & Devices

Key Trading Statistics (detail begins on page 7)

Clinical Laboratories Contract Pharma Manufacturing Contract Research Organizations Disease Management Emergency Services Health Care Staffing HMO - Medical Information Services Specialty Managed Care Specialty Pharmacy Management Dental Products Durable Medical Equipment Life Sciences Tools Medical Devices and Products Medical / Surgical / Dental Supplies Acute-Care Hospitals Assisted Living Diagnostic Imaging Dialysis Services Home Care / Hospice Long-Term Care Physician Practice Management Psychiatric Hospitals / Management Surgicenters / Rehabilitation

3 5 5 2 1 4 10 11 2 5 3 4 3 14 6 6 6 3 2 6 3 3 3 4

Payer, Provider, & Pharmacy Support Services Products & Devices Provider-Based Services HW&Co. HCLS Composite Index

Change in Stock Price 3 mos. 12 mos.

Median TEV/ LTM Multiples Revenue EBITDA

Median TEV/ Forward Mulitples Revenue EBITDA

$8,117 1,765 2,486 3,772 2,793 1,686 21,764 3,273 3,058 18,943 34,917 2,431 18,329 43,198 16,231 16,144 2,308 3,030 21,601 698 1,377 2,286 3,406 2,673

5.1% 38.6% 2.9% (11.5%) 34.9% 15.2% 8.4% 5.5% 28.6% 4.0% 13.1% 12.3% 11.3% 12.2% 17.6% 10.1% 4.5% 9.3% 7.0% 6.8% 14.9% 12.5% 6.3% 14.2%

11.5% 89.8% 36.5% 57.2% 53.8% 68.6% 45.4% 27.2% 104.5% 25.6% 19.9% 33.2% 41.1% 37.2% 50.7% 47.7% 8.2% 12.9% 4.4% 32.5% 56.8% 40.4% 84.0% 44.4%

1.7x 2.3x 1.6x 1.7x 3.2x 1.0x 0.5x 3.2x 1.3x 0.9x 3.0x 1.2x 2.8x 2.9x 0.3x 1.2x 1.9x 1.9x 2.0x 0.7x 1.0x 2.1x 0.4x 1.9x

8.4x 14.8x 11.2x 14.7x 12.5x 14.5x 6.9x 25.2x 10.1x 10.2x 12.8x 11.5x 12.3x 11.6x 12.1x 8.3x 11.5x 6.5x 10.0x 9.0x 6.4x 11.1x 6.2x 8.2x

1.7x 2.4x 1.6x 1.7x 3.1x 1.0x 0.4x 3.2x 1.3x 0.8x 3.0x 1.2x 2.7x 2.9x 0.3x 1.1x 2.1x 1.8x 1.7x 0.7x 1.0x 2.3x 0.4x 1.9x

8.4x 14.2x 11.0x 10.9x 12.5x 13.9x 7.2x 13.2x NA 10.2x 11.6x 10.2x 10.9x 11.1x 10.4x 7.7x 13.6x 6.5x 8.3x 9.7x 7.7x 11.3x 7.0x 8.1x

48

$6,766

13.2%

52.0%

1.7x

12.9x

1.7x

11.3x

30

$23,021

13.3%

36.4%

2.1x

12.1x

2.0x

10.8x

36

$5,947

9.5%

36.8%

1.5x

8.6x

1.4x

8.9x

114

$9,845

11.8%

43.1%

1.7x

11.1x

1.7x

10.3x

10.2%

27.5%

S&P 500

Public Company Sector Performance (12-month % change in stock price)

Specialty Managed Care Contract Pharma Manufacturing Psychiatric Hospitals / Management Health Care Staffing Disease Management Long-Term Care Emergency Services Medical / Surgical / Dental Supplies Acute-Care Hospitals HMO - Medical Surgicenters / Rehabilitation HW&Co. HCLS Composite Index Life Sciences Tools Physician Practice Management Medical Devices and Products Contract Research Organizations Durable Medical Equipment Home Care / Hospice S&P 500 Information Services Specialty Pharmacy Management Dental Products Diagnostic Imaging Clinical Laboratories Assisted Living Dialysis Services (10.0%)

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%

110.0%

120.0%

3

Equity Markets Overview December 2013 Healthcare & Life Sciences Industry Stock Performance

200 83.7%

180

59.0%

160

52.0%

140 120 100 80 60 40 Nov-10

Feb-11

May-11

Aug-11

S&P 500

Top 25 Equity Offerings (by proceeds)

Nov-11

Feb-12

May-12

Aug-12

Nov-12

Dow Jones U.S. Health Care Index

Issuer

Feb-13

May-13

Aug-13

Nov-13

HW&Co. HCLS Index

Ticker

Transaction Type

Gross Proceeds ($mm)

Closing Date

Filing Date

11/19/13

11/19/13

Clovis Oncology Inc

CLVS

Follow-On

$192.0

11/06/13

11/06/13

Integra LifeSciences Hldg Corp

IART

Follow-On

161.0

11/19/13

11/19/13

Horizon Pharma Inc

HZNP

Convertible

150.0

11/13/13

11/13/13

Tandem Diabetes Care Inc

TNDM

IPO

138.0

11/19/13

11/19/13

AMRI

AMRI

Convertible

130.0

11/05/13

11/05/13

Karyopharm Therapeutics Inc

KPTI

IPO

108.8

11/05/13

11/05/13

InterMune Inc

ITMN

Follow-On

97.2

11/20/13

11/20/13

Cardiovascular Systems Inc

CSII

Follow-On

90.0

11/14/13

11/14/13

Relypsa Inc

RLYP

IPO

86.7

11/27/13

11/27/13

Inogen Inc

INGN

IPO

86.3

11/08/13

11/08/13

Ultragenyx Pharmaceutical Inc

RARE

IPO

86.3

11/05/13

11/05/13

Zogenix Inc

ZGNX

Follow-On

69.0

11/07/13

11/07/13

ZELTIQ Aesthetics Inc

ZLTQ

Follow-On

67.3

11/13/13

11/13/13

Synta Pharmaceuticals Corp

SNTA

Follow-On

60.4

11/20/13

11/20/13

AP Pharma Inc

APPA

Follow-On

60.0

11/08/13

11/08/13

Cara Therapeutics Inc

CARA

IPO

60.0

11/29/13

11/29/13

CymaBay Therapeutics Inc

CMBY

IPO

57.3

11/29/13

11/29/13

Ignyta Inc

IGASD

Follow-On

54.1

11/08/13

11/08/13

Hansen Medical Inc

HNSN

Follow-On

52.4

11/12/13 11/06/13 11/15/13 11/08/13 11/26/13 11/14/13

11/12/13 11/06/13 11/15/13 11/08/13 11/26/13 11/14/13

GeNo LLC Tetraphase Pharmaceuticals Inc Retrophin Inc Kindred Biosciences Inc Targacept Inc Boston Therapeutics Inc

GNO TTPH RTRX KIN TRGT BTHE

IPO Follow-On Follow-On IPO Follow-On Follow-On

50.0 49.1 44.1 40.3 40.0 38.9

4

M&A Overview December 2013

Quarterly M&A Activity

Middle Market Healthcare Transaction Highlights

350

Announce d

22

300 18

250

16 13

13

18

20 12

11

12

16

200

150 242

256

267 245

236

100

219

229

Buye r

Coram, Inc. BarrierSafe Solutions International, Inc. ShiftWise, Inc. OmniSYS, LLC American Care Air Ambulance, Inc. Genova Diagnostics, Inc. Wolverine Anesthesia Consultants MD, PA Paragon Medical, Inc. SunCrest Healthcare, Inc. Senior Home Care, Inc.

CVS Caremark Corporation Ansell Ltd. AMN Healthcare Services Inc. Moelis Capital Partners LLC REVA Air Ambulance, Inc. Levine Leichtman Capital Partners T eam Health Holdings, Inc. Beecken Petty O'Keefe & Company Almost Family Inc. Kindred Healthcare Inc.

8

304

291

Targe t

11/26/2013 11/25/2013 11/21/2013 11/21/2013 11/18/2013 11/13/2013 11/8/2013 11/7/2013 11/4/2013 11/4/2013

18

Number of Transactions__

Announced Healthcare & Life Sciences M&A

LTM Deal Statistics

221 200

209

Aggre gate Value ($bn)

160

Numbe r of De als

$104.8

50

Me dian Transaction Multiple s TEV/Re v TEV/EBITDA

1,130

2.12x

9.8x

Note: Transactions based on publicly available information 0 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 PEG Acquirer

Announced Healthcare & Life Sciences Transactions $500

1200

21x

4.0x

18x

3.5x

1000

$400

800

$300 $250 $200

600 $194.1

$174.6

400

$141.4

$150

$101.6

$110.6

$96.8

$100

200

12.8x 12x

0 2009

2010 Aggregate Deal Value

2011

2012

7.7x

1.5x

6x

1.0x 0.5x

0x

0.0x

2013 YTD

2008

2009

# of deals

2010

2011

TEV / LTM EBITDA

2012

2013 YTD

TEV / LTM Sales

PEG Investments and Exits

Numbe r of Companie s

160

8 16 9 23 49 51 3 6 6 24

140

139 127 120

Transaction Volume'

Biotechnology Healthcare T echnology Healthcare Distributors Healthcare Equipment Healthcare Facilities Healthcare Services Healthcare Supplies Life Sciences T ools & Services Managed Healthcare Pharmaceuticals

2.0x

9.6x 9x

PEG Investments by Segment (Last 3 Years) HC&LS Industry Se gme nt

2.5x

10.9x

11.1x

3x

$50 $0

3.0x

15.2x

15x

EV / LTM Revenue Multiple__

$350

EV / LTM EBITDA Multiple__

$450

2008

Announced Private Equity M&A Activity

Median Healthcare & Life Sciences Transaction Multiples

Number of Transactions__

Aggregate Transaction Value ($ in billions)

Healthcare & Life Sciences M&A Trends

Strategic Acquirer

120

113 95

94

100

80

79 80

71

69 60

58

60

65

62

54

50

49 40

65

42

40

40 27 20 0 2003

2004

2005

2006

2007

Number of Investments

2008

2009

2010

2011

2012

2013 YTD

Number of Exits

5

Debt Markets Overview December 2013 Quarterly Healthcare Loan Volume

Average Spread on Healthcare Loans

$24

L + 500

$21

Average Spread Over LIBOR__

Loan Volume by Quarter ($ in billions)___

Key Credit Statistics

$18 $15 $12 $9 $6

L + 400

L + 300

L + 200

L + 100 $3 $0

L+0 2007

3Q07 1Q08 3Q08 1Q09 3Q09 1Q10 3Q10 1Q11 3Q11 1Q12 3Q12 1Q13 3Q13 Pro Rata

Institutional

Credit Statistics

2009

2010

2011

2012

2013YTD

Weighted-Average Institutional

Average Secondary Spread L + 1000

2007

2008

2009

2010

2011

2012

2013YTD

Average Spread Over LIBOR__

EBITDA Multiple__

6.0x

2008

Revolving Credit / Term Loan A

4.0x

2.0x

L + 800

L + 600

L + 400

L + 200

L+ 0

0.0x Debt/EBITDA

Senior Debt/EBITDA EBITDA/Cash Interest EBITDA - Capex/Cash Interest 1

(1) Not available for 2013YTD.

Recent Healthcare & Life Sciences Debt Offerings (by deal amount)

Date Effective

Borrower Name

Description

Rating

Spread

$579

$579

Term Loan B

B / NR

L+ 325

Dental laboratories

557

557

Term Loan B

B / NR

L+ 450

Genova Diagnostics Inc

Medical laboratories

110

100

Term Loan A

NR / NR

L+ 425

11/13/13

Genova Diagnostics Inc

Medical laboratories

110

10

Revolver/Line >= 1 Yr.

NR / NR

L+ 425

11/01/13

PT Network LLC

Offices of health practitioners

26

24

Term Loan B

NR / NR

L+ 700

11/01/13

PT Network LLC

Offices of health practitioners

26

2

Revolver/Line >= 1 Yr.

NR / NR

L+ 700

11/14/13

CHG Healthcare Services

Health and allied services

11/27/13

Heartland Dental Care Inc

11/13/13

Deal Amount

Tranche Amount ($mn)

Type

6

Healthcare & Life Sciences Trading Statistics December 2013 Payer, Provider, & Pharmacy Support Services Company Name 11/29/2013 Clinical Laboratories Bio-Reference Laboratories Inc. Laboratory Corp. of America Holdings Quest Diagnostics Inc. Number of Companies

Contract Pharma Manufacturing Akorn, Inc. Cambrex Corporation. Integrated Biopharma Inc. Patheon Inc. West Pharmaceutical Services, Inc. Number of Companies

Contract Research Organizations Albany Molecular Research Inc. Charles River Laboratories International, Inc. Covance Inc. ICON Public Limited Company PAREXEL International Corporation Number of Companies

3

5

5

Disease Management Alere Inc. Healthways Inc. Number of Companies

2

Emergency Services Air Methods Corp. Number of Companies

1

Health Care Staffing AMN Healthcare Services Inc. Cross Country Healthcare, Inc. On Assignment Inc. Team Health Holdings, Inc. Number of Companies

4

As of November 29, 2013

Stock Price % Change 3 mos. 12 mos.

52 Week High Low

Equity Total Debt Mkt. Value

Cash and Equiv.

Total Ent. Value ( )

Lastest Twelve Months (LTM) Revenue EBITDA EBIT

LTM Period

Lastest FYE Date

Forward Estimate Revenue

EBITDA

EBIT

TEV/ LTM Multiples

TEV/ Fwd Multiples

Revenue

Revenue

EBITDA

EBITDA

$29.20 101.85 60.94 Median: Mean:

0.2% 6.2% 5.1% 5.1% 3.8%

11.5% 20.9% 4.9% 11.5% 12.4%

$37.97 108.00 64.10

$23.36 82.98 55.16 Total

$808 8,902 8,862 $18,572

$35 2,664 3,394

$29 174 158

$814 11,411 12,127 $8,117 $8,117

$734 5,777 7,163 $13,674

$104 1,274 1,425

$85 1,085 1,137

Jul-13 Sep-13 Sep-13

Oct-12 Dec-12 Dec-12

$715 5,820 7,126 $13,661

$100 1,255 1,437

$82 1,043 1,165

1.1x 2.0x 1.7x 1.7x 1.6x

7.9x 8.8x 8.4x 8.4x 8.4x

1.1x 2.0x 1.7x 1.7x 1.6x

8.1x 9.1x 8.4x 8.4x 8.5x

$25.75 19.50 0.00 9.76 49.92 Median: Mean:

40.7% 38.6% 2.0% 51.6% 31.7% 38.6% 32.9%

89.8% 94.0% (30.5%) 168.9% 83.9% 89.8% 81.2%

$26.16 19.74 0.22 9.86 50.60

$12.44 10.36 0.11 3.00 26.61 Total

$2,481 590 3 1,375 3,486 $7,936

$108 102 15 610 406

$76 25 0 41 222

$2,513 666 18 1,962 3,663 $1,765 $1,765

$304 285 34 943 1,347 $2,914

$97 59 2 118 242

$85 36 1 72 159

Sep-13 Sep-13 Sep-13 Jul-13 Sep-13

Dec-12 Dec-12 Jun-13 Oct-12 Dec-12

$316 308 NA 1,016 1,372 $3,012

$105 67 NA 141 250

$96 43 NA 54 164

8.3x 2.3x 0.5x 2.0x 2.7x 2.3x 3.2x

26.0x 11.8x 9.6x 16.2x 14.8x 14.8x 15.7x

8.0x 2.2x NA 1.9x 2.7x 2.4x 3.7x

24.0x 10.0x NA 13.9x 14.6x 14.2x 15.6x

$12.08 52.17 84.38 38.14 41.22 Median: Mean:

7.8% 11.5% 2.6% 2.9% (12.7%) 2.9% 2.4%

151.7% 33.8% 48.1% 36.5% 26.4% 36.5% 59.3%

$14.37 52.72 91.99 44.23 55.02

$4.79 35.54 56.18 26.70 28.45 Total

$382 2,510 4,740 2,334 2,329 $12,295

$7 640 265 0 501

$40 130 483 156 203

$350 3,027 4,412 2,118 2,526 $2,486 $2,486

$247 1,156 2,341 1,291 1,789 $6,824

$44 266 351 161 226

$28 178 229 116 149

Sep-13 Sep-13 Sep-13 Sep-13 Sep-13

Dec-12 Dec-12 Dec-12 Dec-12 Jun-13

$248 1,166 2,403 1,331 1,928 $7,076

$48 275 367 172 265

$31 196 242 125 185

1.4x 2.6x 1.9x 1.6x 1.4x 1.6x 1.8x

7.9x 11.2x 12.6x 13.2x 11.2x 11.2x 11.2x

1.4x 2.6x 1.8x 1.6x 1.3x 1.6x 1.7x

7.4x 11.0x 12.0x 12.3x 9.5x 11.0x 10.4x

$32.72 14.01 Median: Mean:

3.8% (26.8%) (11.5%) (11.5%)

82.7% 31.7% 57.2% 57.2%

$36.05 22.20

$17.93 9.59 Total

$2,679 491 $3,170

$3,860 261

$354 3

$6,795 750 $3,772 $3,772

$3,013 669 $3,682

$630 40

$168 12

Sep-13 Sep-13

Dec-12 Dec-12

$3,034 669 $3,703

$666 64

$536 11

2.3x 1.1x 1.7x 1.7x

10.5x 18.9x 14.7x 14.7x

2.2x 1.1x 1.7x 1.7x

10.2x 11.7x 10.9x 10.9x

$55.96 Median: Mean:

34.9% 34.9% 34.9%

53.8% 53.8% 53.8%

$56.48

$32.24 Total

$2,185 $2,185

$627

$19

$2,793 $2,793 $2,793

$874 $874

$223

$143

Sep-13

Dec-12

$887 $887

$223

$140

3.2x 3.2x 3.2x

12.5x 12.5x 12.5x

3.1x 3.1x 3.1x

12.5x 12.5x 12.5x

$13.88 7.64 34.03 46.73 Median: Mean:

(1.4%) 29.5% 10.0% 20.4% 15.2% 14.6%

23.8% 79.3% 70.3% 66.9% 68.6% 60.1%

$16.20 7.75 35.07 46.92

$10.34 4.00 18.76 27.50 Total

$639 237 1,832 3,265 $5,973

$149 0 358 506

$32 32 45 132

$756 205 2,145 3,639 $1,686 $1,686

$1,011 441 1,682 2,307 $5,440

$74 6 162 230

$61 (1) 132 178

Sep-13 Sep-13 Sep-13 Sep-13

Dec-12 Dec-12 Dec-12 Dec-12

$1,012 438 1,671 2,373 $5,493

$80 7 162 250

$65 0 127 188

0.7x 0.5x 1.3x 1.6x 1.0x 1.0x

10.2x 33.6x 13.2x 15.8x 14.5x 18.2x

0.7x 0.5x 1.3x 1.5x 1.0x 1.0x

9.5x 30.3x 13.2x 14.6x 13.9x 16.9x

7

Healthcare & Life Sciences Trading Statistics December 2013 Payer, Provider, & Pharmacy Support Services Company Name 11/29/2013

Stock Price % Change 3 mos. 12 mos.

52 Week High Low

Equity Total Debt Mkt. Value

Cash and Equiv.

HMO - Medical Commercial: Aetna Inc. Cigna Corp. Capevin Holdings Ltd Health Net, Inc. Humana Inc. UnitedHealth Group Incorporated WellPoint Inc. Number of Companies

Government: Centene Corp. Molina Healthcare, Inc. WellCare Health Plans, Inc. Number of Companies

7

3

Total Ent. Value (TEV)

Lastest Twelve Months (LTM) EBITDA EBIT

Revenue

LTM Period

Lastest FYE Date

Forward Estimate Revenue

EBITDA

EBIT

TEV/ LTM Multiples

TEV/ Fwd Multiples

Revenue

Revenue

EBITDA

EBITDA

$68.93 87.45 7.55 30.55 103.99 74.48 92.88 Median: Mean:

8.1% 10.6% 9.4% 0.7% 11.6% 2.8% 8.7% 8.7% 7.4%

61.3% 67.9% 26.9% 30.7% 58.2% 37.0% 66.9% 58.2% 49.8%

$69.46 88.57 8.00 33.90 104.69 75.88 94.33

$42.66 51.34 5.90 23.14 64.46 51.36 55.26 Total

$25,332 24,172 6,645 2,429 16,213 74,983 27,438 $177,213

$8,817 5,244 0 499 2,876 16,862 15,702

$2,082 3,055 3 686 1,255 8,286 2,186

$32,117 26,456 6,642 2,242 17,834 84,689 40,954 $30,134 $30,134

$44,038 31,849 320 11,148 40,683 120,141 68,989 $317,168

$3,921 3,732 0 343 2,645 10,255 5,499

$3,403 3,344 318 307 2,384 9,272 4,876

Sep-13 Sep-13 Jun-13 Sep-13 Sep-13 Sep-13 Sep-13

Dec-12 Dec-12 Jun-13 Dec-12 Dec-12 Dec-12 Dec-12

$46,943 32,050 NA 11,052 41,184 122,264 70,790 $324,282

$3,927 3,650 NA 402 2,629 10,602 4,625

$3,600 3,070 NA 350 2,334 9,359 4,223

0.7x 0.8x 20.7x 0.2x 0.4x 0.7x 0.6x 0.7x 3.5x

8.2x 7.1x 0.0x 6.5x 6.7x 8.3x 7.4x 7.1x 6.3x

0.7x 0.8x NA 0.2x 0.4x 0.7x 0.6x 0.6x 0.6x

8.2x 7.2x NA 5.6x 6.8x 8.0x 8.9x 7.6x 7.4x

59.73 33.60 74.30 Median: Mean:

2.5% (1.9%) 14.6% 2.5% 5.1%

36.6% 21.7% 53.7% 36.6% 37.3%

67.84 40.90 75.27

39.14 25.70 44.75 Total

3,271 1,538 3,247 $8,056

521 770 337

741 857 1,391

3,057 1,451 2,193 $2,234 $2,234

10,589 6,576 9,077 $26,242

275 235 325

220 185 300

Sep-13 Sep-13 Sep-13

Dec-12 Dec-12 Dec-12

11,005 6,652 9,543 $27,200

347 217 385

273 147 343

0.3x 0.2x 0.2x 0.2x 0.3x

11.1x 6.2x 6.7x 6.7x 8.0x

0.3x 0.2x 0.2x 0.2x 0.2x

8.8x 6.7x 5.7x 6.7x 7.1x

$9.73 0.00 Median: Mean:

5.5% 0.0% 2.8% 2.8%

9.3% 245.3% 127.3% 127.3%

$10.00 0.80

$7.75 0.15 Total

$542 3 $545

$0 1

$78 0

$438 4 $221 $221

$166 6 $172

$11 (0)

($13) (0)

Sep-13 Sep-13

Dec-12 Dec-12

$174 NA $174

$35 NA

$24 NA

2.6x 0.7x NM 1.7x 1.7x

39.7x 39.7x 39.7x

2.5x NA 2.5x 2.5x

12.6x NA 12.6x 12.6x

38.67 Median: Mean:

23.2% 23.2% 23.2%

166.7% 166.7% 166.7%

40.86

13.60 Total

1,738 $1,738

700

776

1,662 $1,662 $1,662

502 $502

61

44

Sep-13

Dec-12

$513 $513

$120

$53

3.3x 3.3x 3.3x

27.1x 27.1x 27.1x

NA NA NA

NA NA NA

20.3% 106.6% 48.7% 20.4% 1.3% 33.7% (30.8%) 27.2% 23.8% 28.4%

$16.43 144.42 59.42 62.84 31.93 26.58 4.71 24.15

$8.85 62.77 37.63 46.08 17.39 15.88 2.21 16.62 Total

$2,637 4,878 19,727 687 2,022 1,333 220 1,405 $1,713

$545 243 183 0 268 802 246 0

$61 62 288 3 109 0 20 73

$3,122 5,059 18,988 673 2,159 2,135 447 1,320 $4,238 $2,147

$1,373 540 2,761 198 503 674 243 446 $521

$29 48 812 50 146 208 16 89

($63) 4 653 47 96 103 3 74

Sep-13 Sep-13 Sep-13 Sep-13 Sep-13 Sep-13 Sep-13 Sep-13

Dec-12 Dec-12 Dec-12 Dec-12 Dec-12 Dec-12 Dec-12 Mar-13

$1,375 591 2,915 202 503 676 237 456 $547

$165 110 974 51 154 218 39 108

$76 70 715 49 86 89 21 80

2.3x 9.4x 6.9x 3.4x 4.3x 3.2x 1.8x 3.0x 3.3x 3.3x

109.4x 105.5x 23.4x 13.4x 14.8x 10.3x 27.3x 14.8x 19.1x 19.1x

2.3x 8.6x 6.5x 3.3x 4.3x 3.2x 1.9x 2.9x 3.2x 3.2x

18.9x 45.8x 19.5x 13.2x 14.0x 9.8x 11.5x 12.2x 13.6x 13.6x

Information Services Data/Analytics: Accelrys Inc. Oman Foods International S.A.O.G. Number of Companies

2

eHealth: WebMD Health Corp. Number of Companies

1

Hospital/Physician: Allscripts Healthcare Solutions, Inc. athenahealth, Inc. Cerner Corporation Computer Programs & Systems Inc. HMS Holdings Corp. MedAssets, Inc. Merge Healthcare Incorporated Quality Systems Inc. Number of Companies

8

As of November 29, 2013

$14.94 0.1% 131.17 22.4% 57.47 23.2% 61.52 11.5% 22.91 (10.5%) 21.54 (6.3%) 2.34 (14.9%) 23.36 11.1% Median: ` Mean: 4.6%

8

Healthcare & Life Sciences Trading Statistics December 2013 Payer, Provider, & Pharmacy Support Services Company Name 11/29/2013 Specialty Managed Care Assurant Inc. CorVel Corporation Number of Companies

Specialty Pharmacy Management BioScrip Inc. Express Scripts Holding Company Catamaran Corporation Omnicare Inc. PharMerica Corporation Number of Companies

2

5

As of November 29, 2013

Stock Price % Change 3 mos. 12 mos.

52 Week High Low

Equity Total Debt Mkt. Value

Cash and Equiv.

Total Ent. Value ( )

Lastest Twelve Months (LTM) Revenue EBITDA EBIT

LTM Period

Lastest FYE Date

Forward Estimate Revenue

EBITDA

EBIT

TEV/ LTM Multiples

TEV/ Fwd Multiples

Revenue

Revenue

EBITDA

EBITDA

64.94 46.29 Median: Mean:

21.2% 36.0% 28.6% 28.6%

91.1% 117.9% 104.5% 104.5%

65.38 46.47

33.68 20.82 Total

4,722 969 $5,691

1,734 0

1,287 22

5,170 947 $3,058 $3,058

8,821 457 $9,278

852 67

732 51

Sep-13 Sep-13

Dec-12 Mar-13

8,835 483 $9,318

NA NA

855 NA

0.6x 2.1x 1.3x 1.3x

6.1x 14.1x 10.1x 10.1x

0.6x 2.0x 1.3x 1.3x

NA NA NA NA

$6.81 67.35 48.10 57.28 22.58 Median: Mean:

(44.9%) 5.5% (17.3%) 4.0% 84.2% 4.0% 6.3%

(33.2%) 25.6% 2.1% 60.7% 59.6% 25.6% 22.9%

$17.62 67.95 60.93 58.74 22.65

$5.61 52.50 45.72 35.09 11.84 Total

$464 54,271 9,923 5,899 665 $71,221

$416 14,114 1,020 1,975 234

$0 1,722 436 506 52

$879 66,679 10,528 7,368 847 $18,943 $18,943

$779 105,826 13,581 6,206 1,741 $128,133

$36 6,553 690 718 120

$21 4,264 455 579 86

Sep-13 Sep-13 Sep-13 Sep-13 Sep-13

Dec-12 Dec-12 Dec-12 Dec-12 Dec-12

$838 103,853 14,295 6,266 1,732 $126,984

$49 6,677 660 704 129

$24 6,308 449 592 95

1.1x 0.6x 0.8x 1.2x 0.5x 0.9x 0.9x

24.5x 10.1x 14.8x 10.3x 7.0x 10.2x 13.0x

1.0x 0.6x 0.7x 1.2x 0.5x 0.8x 0.8x

18.0x 10.0x 16.0x 10.5x 6.6x 10.2x 11.3x

9

Healthcare & Life Sciences Trading Statistics December 2013 Products & Devices Company Name 11/29/2013 Dental Products 3M Company DENTSPLY International Inc. Sirona Dental Systems Inc. Number of Companies

Durable Medical Equipment Hill-Rom Holdings, Inc. Invacare Corporation Prism Medical Ltd. ResMed Inc. Number of Companies

Life Sciences Tools Agilent Technologies Inc. Becton, Dickinson and Company Life Technologies Corporation Number of Companies

3

4

3

Stock Price % Change 3 mos. 12 mos.

52 Week High Low

Equity Total Debt Mkt. Value

Cash and Equiv.

Total Ent. Value

Lastest Twelve Months (LTM) Revenue EBITDA EBIT

LTM Period

Lastest FYE Date

Forward Estimate Revenue

EBITDA

EBIT

TEV/ LTM Multiples

TEV/ Fwd Multiples

Revenue

Revenue

EBITDA

EBITDA

$133.51 47.56 68.78 Median: Mean:

17.8% 13.1% 4.2% 13.1% 11.7%

47.3% 19.9% 10.7% 19.9% 26.0%

$134.16 48.97 75.81

$89.60 38.76 61.25 Total

$89,888 6,785 3,783 $100,456

$5,777 1,550 75

$2,340 51 242

$92,810 8,322 3,619 $34,917 $34,917

$30,689 2,950 1,101 $34,741

$7,876 562 284

$6,530 434 217

Sep-13 Sep-13 Sep-13

Dec-12 Dec-12 Sep-13

$31,012 2,977 1,179 $35,168

$8,033 594 317

$6,699 487 273

3.0x 2.8x 3.3x 3.0x 3.0x

11.8x 14.7x 12.8x 12.8x 13.1x

3.0x 2.8x 3.1x 3.0x 3.0x

11.6x 14.0x 11.4x 11.6x 12.3x

41.41 22.40 5.39 48.81 Median: Mean:

20.9% 44.1% 3.7% 1.2% 12.3% 17.5%

48.1% 60.0% 3.1% 18.2% 33.2% 32.4%

42.56 22.85 5.89 57.34

27.46 10.26 4.50 40.55 Total

2,417 717 45 6,935 $10,114

307 56 21 361

127 33 1 977

2,597 740 66 6,319 $2,431 $2,431

1,716 1,395 74 1,532 $4,717

268 21 8 473

169 (16) 6 396

Sep-13 Sep-13 Aug-13 Sep-13

Sep-13 Dec-12 Nov-12 Jun-13

1,737 1,371 75 1,614 $4,798

314 18 10 521

210 (26) NA 439

1.5x 0.5x 0.9x 4.1x 1.2x 1.8x

9.7x 34.7x 8.6x 13.3x 11.5x 16.6x

1.5x 0.5x 0.9x 3.9x 1.2x 1.7x

8.3x 42.3x 6.6x 12.1x 10.2x 17.3x

$53.57 108.59 75.70 Median: Mean:

14.5% 11.3% 1.6% 11.3% 9.1%

39.7% 41.1% 53.1% 41.1% 44.6%

$55.74 110.13 75.76

$37.69 76.03 48.00 Total

$17,721 21,077 13,083 $51,880

$2,699 3,970 2,072

$2,675 1,890 336

$17,748 22,439 14,801 $18,329 $18,329

$6,782 8,014 3,842 $18,638

$1,323 2,129 1,200

$951 1,621 806

Oct-13 Sep-13 Sep-13

Oct-13 Sep-13 Dec-12

$7,070 8,427 3,845 $19,342

$1,623 2,280 1,288

$1,367 1,704 1,111

2.6x 2.8x 3.9x 2.8x 3.1x

13.4x 10.5x 12.3x 12.3x 12.1x

2.5x 2.7x 3.8x 2.7x 3.0x

10.9x 9.8x 11.5x 10.9x 10.8x

$38.19 37.72 68.45 11.58 138.88 74.80 38.84 22.39 39.31 94.66 57.32 74.42 100.85 91.41 Median: Mean:

13.2% 16.9% (2.4%) 8.6% 20.0% 14.0% 25.9% 3.8% 0.1% 9.3% 10.6% 11.2% 13.1% 15.9% 12.2% 11.5%

(41.3%) 15.1% 3.8% 105.7% 40.7% 39.4% 49.9% 17.9% 31.8% 36.8% 35.7% 37.7% 58.8% 37.7% 37.2% 33.5%

$66.85 38.50 74.60 12.48 141.02 75.93 39.63 23.96 42.60 95.99 58.85 75.50 103.12 91.59

$31.64 31.56 62.80 5.46 95.39 52.82 25.63 18.46 28.71 69.18 40.28 53.78 62.30 65.14 Total

$59,049 1,070 37,148 15,462 10,817 52,151 1,342 6,115 6,521 267,077 57,175 28,162 36,444 15,629 $594,162

$8,263 0 9,066 4,249 1,504 3,502 471 4,839 1,822 15,107 12,284 2,774 7,114 1,688

$2,882 208 2,376 571 782 1,996 7 822 632 17,204 1,066 1,110 1,846 917

$58,798 946 43,835 19,140 11,540 53,723 1,806 10,132 7,710 256,956 56,875 25,798 41,698 15,815 $43,198 $43,198

$40,205 373 14,644 7,126 2,999 18,827 1,049 2,477 4,017 70,515 16,764 8,891 12,883 4,563 $205,332

$11,040 87 4,071 1,618 831 4,235 174 843 307 22,686 5,691 1,648 2,732 1,701

$9,158 71 3,320 930 697 3,354 137 327 71 18,648 4,847 1,353 1,727 1,349

Sep-13 Sep-13 Sep-13 Sep-13 Sep-13 Sep-13 Sep-13 Sep-13 Sep-13 Sep-13 Oct-13 Sep-13 Sep-13 Sep-13

Dec-12 Dec-12 Dec-12 Dec-12 Dec-12 Dec-12 Dec-12 Sep-13 Dec-12 Dec-12 Apr-13 Dec-12 Dec-12 Dec-12

$21,957 377 15,139 7,130 3,039 19,057 1,063 2,458 4,087 70,881 16,989 8,989 12,932 4,603 $188,699

$5,264 79 4,177 1,668 821 4,175 188 925 684 23,399 6,151 2,423 2,736 1,724

$4,013 68 3,382 958 686 3,305 144 758 469 19,262 5,334 2,120 2,437 1,361

1.5x 2.5x 3.0x 2.7x 3.8x 2.9x 1.7x 4.1x 1.9x 3.6x 3.4x 2.9x 3.2x 3.5x 2.9x 2.9x

5.3x 10.9x 10.8x 11.8x 13.9x 12.6x 10.4x 12.0x 23.5x 11.3x 10.0x 15.7x 15.3x 9.3x 11.6x 12.3x

2.7x 2.5x 2.9x 2.7x 3.8x 2.8x 1.7x 4.1x 1.9x 3.6x 3.3x 2.9x 3.2x 3.4x 2.9x 3.0x

11.2x 12.0x 10.5x 11.5x 14.1x 12.9x 9.6x 11.0x 11.3x 11.0x 9.2x 10.6x 15.2x 9.2x 11.1x 11.4x

$70.53 64.60 114.00 165.89 38.17 41.49 Median: Mean:

23.4% 28.5% 11.8% 36.5% 9.4% 3.8% 17.6% 18.9%

69.9% 60.3% 41.2% 77.0% 37.6% 23.5% 50.7% 51.6%

$71.16 65.45 115.46 166.57 38.55 44.39

$41.47 40.22 78.96 92.86 26.97 33.00 Total

$16,224 22,059 9,787 38,107 2,409 4,368 $92,955

$1,397 3,883 408 4,874 214 860

$1,231 2,753 70 2,960 154 516

$16,390 23,189 10,602 40,021 2,471 4,712 $16,231 $16,231

$87,959 99,727 9,443 127,163 9,172 3,760 $337,224

$1,133 2,514 801 3,216 239 398

$967 2,088 672 2,561 201 350

Sep-13 Sep-13 Sep-13 Sep-13 Sep-13 Oct-13

Sep-13 Jun-13 Dec-12 Mar-13 Dec-12 Apr-13

$114,154 86,279 9,560 132,128 9,184 4,080 $355,385

$1,622 2,421 807 3,714 256 424

$1,461 2,010 678 2,997 207 373

0.2x 0.2x 1.1x 0.3x 0.3x 1.3x 0.3x 0.6x

14.5x 9.2x 13.1x 12.4x 10.3x 11.9x 12.1x 11.9x

0.1x 0.3x 1.1x 0.3x 0.3x 1.2x 0.3x 0.5x

10.1x 9.6x 13.1x 10.8x 9.6x 11.1x 10.4x 10.7x

Medical Devices and Products Abbott Laboratories ArthroCare Corporation Baxter International Inc. Boston Scientific Corporation CR Bard Inc. Danaher Corp. Hanger, Inc. Hologic Inc. Hospira Inc. Johnson & Johnson Medtronic, Inc. Stryker Corporation Thermo Fisher Scientific, Inc. Zimmer Holdings, Inc. Number of Companies

Medical / Surgical / Dental Supplies AmerisourceBergen Corporation Cardinal Health, Inc. Henry Schein, Inc. McKesson Corporation Owens & Minor Inc. Patterson Companies, Inc. Number of Companies

14

6

As of November 29, 2013

10

Healthcare & Life Sciences Trading Statistics December 2013 Provider-Based Services Company Name 11/29/2013 Acute-Care Hospitals Community Health Systems, Inc. Health Management Associates Inc. HCA Holdings, Inc. Lifepoint Hospitals Inc. Tenet Healthcare Corp. Universal Health Services Inc. Number of Companies

Assisted Living Algoma Central Corp. Brookdale Senior Living Inc. Capital Senior Living Corp. Emeritus Corp. Five Star Quality Care Inc. Skilled Healthcare Group, Inc. Number of Companies

6

6

Diagnostic Imaging Alliance Healthcare Services, Inc. RadNet, Inc. Varian Medical Systems, Inc. Number of Companies

3

Dialysis Services DaVita HealthCare Partners Inc. Fresenius Medical Care AG & Co. KGAA Number of Companies

2

Home Care / Hospice Addus HomeCare Corporation Almost Family Inc. Amedisys Inc. Gentiva Health Services Inc. LHC Group, Inc. Chemed Corp. Number of Companies

Long-Term Care The Ensign Group, Inc. Kindred Healthcare Inc. National Healthcare Corp. Number of Companies

6

3

As of November 29, 2013

Stock Price % Change 3 mos. 12 mos.

52 Week High Low

Equity Total Debt Mkt. Value

Cash and Equiv.

Total Ent. Value

Lastest Twelve Months (LTM) EBIT Revenue EBITDA

LTM Period

Lastest FYE Date

Forward Estimate Revenue

EBITDA

EBIT

TEV/ LTM Multiples

TEV/ Fwd Multiples

Revenue

Revenue

EBITDA

EBITDA

$41.25 13.09 46.42 51.23 43.15 82.43 Median: Mean:

2.4% 1.2% 19.8% 11.1% 9.0% 19.1% 10.1% 10.4%

39.9% 62.2% 46.3% 44.2% 49.1% 84.0% 47.7% 54.3%

$51.29 17.28 49.52 53.87 49.48 82.98

$28.90 7.25 29.86 35.32 28.45 44.06 Total

$3,849 3,462 20,282 2,409 4,282 8,100 $42,384

$9,656 3,780 28,700 1,765 5,823 3,528

$144 1 484 195 82 12

$13,791 7,189 49,767 4,031 10,201 11,886 $16,144 $16,144

$13,043 5,843 33,780 3,619 9,548 7,248 $73,081

$1,628 763 6,433 485 1,226 1,383

$1,056 370 4,716 245 756 1,053

Sep-13 Sep-13 Sep-13 Sep-13 Sep-13 Sep-13

Dec-12 Dec-12 Dec-12 Dec-12 Dec-12 Dec-12

$13,066 6,757 37,945 4,400 11,694 8,417 $82,278

$1,895 795 6,432 539 1,327 1,274

$1,092 376 4,698 311 776 944

1.1x 1.2x 1.5x 1.1x 1.1x 1.6x 1.2x 1.3x

8.2x 9.4x 7.7x 8.3x 8.3x 8.6x 8.3x 8.4x

1.1x 1.1x 1.3x 0.9x 0.9x 1.4x 1.1x 1.1x

7.3x 9.0x 7.7x 7.5x 7.7x 9.3x 7.7x 8.1x

$16.12 29.16 22.33 22.51 4.93 5.14 Median: Mean:

14.3% 12.9% 4.2% 0.6% (7.0%) 4.9% 4.5% 5.0%

32.1% 14.1% 26.1% 2.3% 1.2% (23.9%) 8.2% 8.7%

$16.15 30.65 27.90 30.95 6.87 7.51

$12.35 24.14 16.50 18.15 4.44 4.10 Total

$627 3,624 623 1,075 238 201 $6,389

$225 2,607 441 4,026 63 435

$139 43 19 110 19 3

$714 6,189 1,046 4,998 269 634 $2,308 $2,308

$524 2,518 338 1,829 1,231 864 $7,304

$113 408 56 336 46 77

$67 145 13 153 20 52

Sep-13 Sep-13 Sep-13 Sep-13 Jun-13 Sep-13

Dec-12 Dec-12 Dec-12 Dec-12 Dec-12 Dec-12

NA 2,891 352 1,948 1,364 860 $7,415

NA 438 61 368 42 76

NA 143 14 171 15 50

1.4x 2.5x 3.1x 2.7x 0.2x 0.7x 1.9x 1.8x

6.4x 15.3x 18.6x 14.9x 5.9x 8.0x 11.5x 11.5x

NA 2.1x 3.0x 2.6x 0.2x 0.7x 2.1x 1.7x

NA 14.1x 17.2x 13.6x 6.4x 8.3x 13.6x 11.9x

$28.88 2.00 78.05 Median: Mean:

17.1% (22.8%) 9.3% 9.3% 1.2%

385.4% (17.0%) 12.9% 12.9% 127.1%

$32.85 3.35 80.66

$5.95 1.85 63.10 Total

$301 80 8,251 $8,632

$546 585 506

$49 0 1,118

$847 667 7,577 $3,030 $3,030

$453 684 2,943 $4,080

$141 96 678

$61 37 616

Sep-13 Sep-13 Sep-13

Dec-12 Dec-12 Sep-13

$464 696 3,135 $4,296

$137 102 702

NA 40 633

1.9x 1.0x 2.6x 1.9x 1.8x

5.8x 6.5x 11.2x 6.5x 7.8x

1.8x 1.0x 2.4x 1.8x 1.7x

6.2x 6.5x 10.8x 6.5x 7.8x

$59.55 51.33 Median: Mean:

10.3% 3.7% 7.0% 7.0%

10.7% (2.0%) 4.4% 4.4%

$65.67 56.45

$52.23 46.58 Total

$12,666 15,828 $28,494

$8,455 8,434

$971 602

$20,935 22,267 $21,601 $21,601

$11,174 14,727 $25,901

$2,278 2,761

$1,779 2,125

Sep-13 Sep-13

Dec-12 Dec-12

$11,746 14,617 $26,363

$2,365 2,900

$1,883 2,262

1.9x 2.0x 2.0x 2.0x

9.1x 10.8x 10.0x 10.0x

1.8x 1.5x 1.7x 1.7x

8.9x 7.7x 8.3x 8.3x

$29.00 27.90 16.28 12.35 23.75 77.93 Median: Mean:

30.1% 46.5% (2.2%) 3.3% 2.8% 10.4% 6.8% 15.2%

337.4% 41.5% 53.4% 18.6% 23.6% 13.9% 32.5% 81.4%

$32.40 28.59 18.70 13.85 26.90 82.00

$6.34 17.66 8.81 8.47 19.06 61.68 Total

$316 263 528 448 418 1,374 $433

$0 1 71 910 25 181

$29 28 44 183 0 83

$287 235 556 1,178 457 1,472 $698 $698

$260 353 1,326 1,666 642 1,433 $984

$19 23 53 160 60 191

$17 20 14 141 52 166

Sep-13 Sep-13 Sep-13 Sep-13 Sep-13 Sep-13

Dec-12 Dec-12 Dec-12 Dec-12 Dec-12 Dec-12

$264 355 1,246 1,730 663 1,423 $954

$19 22 50 161 54 206

$16 18 13 141 47 169

1.1x 0.7x 0.4x 0.7x 0.7x 1.0x 0.7x 0.8x

14.7x 10.4x 10.2x 7.5x 7.6x 7.7x 9.0x 9.7x

1.1x 0.7x 0.4x 0.7x 0.7x 1.0x 0.7x 0.8x

15.2x 10.9x 11.1x 7.3x 8.5x 7.1x 9.7x 10.0x

$45.17 16.84 55.80 Median: Mean:

14.9% 12.1% 19.3% 14.9% 15.5%

74.3% 56.8% 22.8% 56.8% 51.3%

$45.37 17.43 55.97

$25.58 9.75 43.39 Total

$994 913 784 $2,691

$214 1,392 10

$46 45 88

$1,160 2,203 768 $1,377 $1,377

$880 6,162 757 $7,799

$121 391 105

$89 191 76

Sep-13 Sep-13 Sep-13

Dec-12 Dec-12 Dec-12

$906 5,230 775 $6,910

$132 335 NA

$103 186 NA

1.3x 0.4x 1.0x 1.0x 0.9x

9.6x 5.6x 6.4x 6.4x 7.2x

1.3x 0.4x 1.0x 1.0x 0.9x

8.8x 6.6x NA 7.7x 7.7x

11

Healthcare & Life Sciences Trading Statistics December 2013 Provider-Based Services Company Name 11/29/2013

Stock Price % Change 3 mos. 12 mos.

52 Week High Low

Equity Total Debt Mkt. Value

Cash and Equiv.

Total Ent. Value

Lastest Twelve Months (LTM) Revenue EBITDA EBIT

LTM Period

Lastest FYE Date

Forward Estimate Revenue

EBITDA

EBIT

TEV/ LTM Multiples

TEV/ Fwd Multiples

Revenue

Revenue

EBITDA

EBITDA

Physician Practice Management Multispecialty / Primary Care: IPC The Hospitalist Company, Inc. Number of Companies

$62.88 Median: Mean:

20.8% 20.8% 20.8%

64.1% 64.1% 64.1%

$63.70

$37.39 Total

$1,064 $1,064

$45

$22

$1,087 $1,087 $1,087

$585 $585

$64

$60

Sep-13

Dec-12

$606 $606

$68

$63

1

1.9x 1.9x 1.9x

16.9x 16.9x 16.9x

1.8x 1.8x 1.8x

16.0x 16.0x 16.0x

Specialty: MEDNAX, Inc. Number of Companies

110.80 Median: Mean:

12.5% 12.5% 12.5%

40.4% 40.4% 40.4%

111.80

78.09 Total

5,433 $5,433

124

16

5,536 $5,536 $5,536

2,058 $2,058

469

431

Sep-13

Dec-12

2,142 $2,142

491

449

1

2.7x 2.7x 2.7x

11.8x 11.8x 11.8x

2.6x 2.6x 2.6x

11.3x 11.3x 11.3x

Dental: Birner Dental Management Services Inc. Number of Companies

$16.36 Median: Mean:

1.1% 1.1% 1.1%

11.8% 11.8% 11.8%

$23.03

$16.21 Total

$34 $34

$9

$2

$41 $41 $41

$64 $64

$4

$1

Sep-13

Dec-12

NA $0

NA

NA

1

0.6x 0.6x 0.6x

10.3x 10.3x 10.3x

NA NA NA

NA NA NA

$61.20 27.42 82.43 Median: Mean:

6.3% (1.6%) 19.1% 6.3% 7.9%

18.3% 99.4% 84.0% 84.0% 67.2%

$62.00 31.31 82.98

$46.00 13.66 44.06 Total

$1,657 370 8,100 $10,127

$27 124 3,528

$282 91 12

$1,329 410 11,886 $3,406 $3,406

$3,368 1,132 7,248 $11,749

$243 58 1,383

$205 43 1,053

Sep-13 Sep-13 Sep-13

Dec-12 Dec-12 Dec-12

$3,483 1,127 8,417 $13,027

$256 58 1,274

$179 43 944

0.4x 0.4x 1.6x 0.4x 0.6x

5.5x 7.0x 8.6x 6.2x 5.3x

0.4x 0.4x 1.4x 0.4x 0.7x

5.2x 7.0x 9.3x 7.0x 7.2x

$48.32 Median: Mean:

26.8% 26.8% 26.8%

71.8% 71.8% 71.8%

$48.71

$27.85 Total

$1,557 $1,557

$621

$46

$2,659 $2,659 $2,659

$1,042 $1,042

$351

$319

Sep-13

Dec-12

$1,081 $1,081

$366

$333

2.6x 2.6x 2.6x

7.5x 7.5x 7.5x

2.5x 2.5x 2.5x

7.3x 7.3x 7.3x

$35.79 8.66 33.76 Median: Mean:

11.6% 0.1% 16.9% 11.6% 9.5%

62.8% (24.4%) 26.0% 26.0% 21.5%

$37.01 11.47 35.01

$20.43 7.21 22.80 Total

$3,129 1,208 409 $4,746

$1,320 1,496 15

$65 9 12

$4,861 2,738 434 $2,008 $2,008

$2,224 2,936 256 $5,416

$537 378 43

$446 314 37

Sep-13 Sep-13 Sep-13

Dec-12 Dec-12 Dec-12

$2,272 2,966 262 $5,500

$544 375 37

$456 307 38

2.2x 0.9x 1.7x 1.7x 1.6x

8.9x 7.2x 10.2x 8.9x 8.7x

2.1x 0.9x 1.7x 1.7x 1.6x

8.9x 7.3x 11.9x 8.9x 9.4x

Psychiatric Hospitals / Management Magellan Health Services Inc. Providence Service Corp. Universal Health Services Inc. Number of Companies

3

Surgicenters / Rehabilitation Surgery Centers: AmSurg Corp. Number of Companies

Rehabilitation / Long Term Acute Care: HEALTHSOUTH Corp. Select Medical Holdings Corporation US Physical Therapy Inc. Number of Companies

1

3

As of November 29, 2013

12

M&A Detail December 2013

Announced

Announced U.S. Healthcare & Life Sciences M&A

Target

11/27/2013 Biozone Pharmaceuticals, Inc. (OTCBB:BZNE)

11/26/2013 Coram, Inc. 11/25/2013 BarrierSafe Solutions International, Inc.

Seller

TMW Systems, Inc.; Frost Group, LLC; Opko Health, Inc. (NYSE:OPK); Muscle Pharm Corp. (OTCPK:MSLP.D) Apria Finance Holdings Inc.

11/25/2013 Jennerex Biotherapeutics, Inc. 11/22/2013 Adventist Health Gresham Surgery Center

Odyssey Investment Partners, LLC; Morgan Stanley Private Equity Transgene SA (ENXTPA:TNG) -

11/22/2013 PAR Fremont LLC 11/21/2013 ShiftWise, Inc.

PAR Fremont LLC -

11/21/2013 OmniSYS, LLC 11/20/2013 Rockford Health Systems, Inc. 11/19/2013 Callidus Biopharma, Inc.

CIC Partners, LP -

11/19/2013 Wellness Centers of America, Inc. 11/19/2013 EHRsolutions, LLC 11/19/2013 Radiological Associates of Sacramento Medical Group, Inc. 11/18/2013 25 Independent Living Facilities Located In 12 States 11/18/2013 Vital Signs, Inc. 11/18/2013 Silverstone Solutions, Inc. 11/18/2013 Aaron Industries, Incorporated

Holiday Acquisition Holdings LLC GE Healthcare Ltd. BB&T Capital Partners, L.L.C.; Stephens Capital Partners Carcor Investment Holdings LLC Holiday Acquisition Holdings LLC

11/18/2013 Correvio LLC 11/18/2013 American Care Air Ambulance, Inc. 11/18/2013 52-Property Portfolio of Senior Housing Properties 11/18/2013 Medical Anesthesia Consultants Medical Group, Inc. 11/16/2013 WeHealAnimals, Inc. 11/15/2013 Three Seniors Housing Facilities Located in Pennsylvania and New Jersey 11/15/2013 Inspire Pharmaceuticals, Inc. 11/14/2013 SECURE NetCheckIn Inc. 11/13/2013 Lifetree Clinical Research, L.C. 11/13/2013 Genova Diagnostics, Inc. 11/13/2013 Mendez National Institute of Transplantation, Serology And HLA Laboratory Operations 11/13/2013 Babar Enterprises, LLC 11/13/2013 HealthcareITCentral.com And HealthcareITToday.com 11/12/2013 MedWest Health System, Inc. 11/12/2013 Lebanon Anesthesia Associates, Ltd. 11/11/2013 Concortis Biosystems, Corp. 11/11/2013 ViroPharma Inc. (NasdaqGS:VPHM) 11/10/2013 Novartis Vaccines & Diagnostics, Inc., Blood Transfusion Diagnostics Unit 11/8/2013 VeriTeQ Corp. (OTCPK:VTEQ)

Buyer

Cocrystal Discovery, Inc.

CVS Caremark Corporation (NYSE:CVS) Ansell Ltd. (ASX:ANN) Sillajen Co. Ltd. Portland Adventist Medical Center, Inc. Dutra Enterprises, Inc. AMN Healthcare Services Inc. (NYSE:AHS) Moelis Capital Partners LLC CDH-Delnor Health System, Inc. Amicus Therapeutics, Inc. (NasdaqGM:FOLD) Incumaker, Inc. (OTCPK:QMKR) Micro Development Services, Inc. Sutter Medical Foundation National Health Investors Inc. (NYSE:NHI) CareFusion Corporation (NYSE:CFN) BiologicTx, Inc. PL Developments, Inc. Cardiome International AG REVA Air Ambulance, Inc. Newcastle Investment Corp. (NYSE:NCT) Sheridan Healthcare, Inc.

Enterprise Value ($mm)

Enterprise Value / LTM Sales EBITDA EBIT

-

-

Private Equity Involvement

-

-

No

2,100.0

-

-

-

No

615.0

2.2x

9.6x

-

Yes

-

-

-

-

No No

4.6 -

-

-

-

No No

130.6

-

-

-

Yes No No

-

-

-

-

No No No

491.0

-

-

-

No

500.0 -

2.0x -

-

-

No No Yes

21.9 1,010.0

0.7x -

-

-

No No No

-

-

-

-

No

Hanover Portfolio Acquisitions, Inc. (OTCBB:HVPA.E) Care Investment Trust LLC

0.1

-

-

-

No

52.5

-

-

-

No

Merck & Co. Inc. (NYSE:MRK) CRI Worldwide, LLC Ferrer Freeman & Company, LLC; Nautic Partners, LLC Mendez National Institute of Transplantation -

Oak Pharmaceuticals Inc. PRA International, Inc. Levine Leichtman Capital Partners

52.8 0.3 -

-

-

-

No No No Yes

The Charlotte-Mecklenburg Hospital Authority -

-

Palo Alto Investors, LLC; Baker Brothers Investments Novartis Vaccines and Diagnostics, Inc. PositiveID Corporation (OTCPK:PSID)

ViraCor Laboratories, L.L.C.

-

-

-

-

No

3.1 -

0.5x -

-

-

No No

DLP Healthcare, LLC

26.3

-

-

-

No

PhyMed Holdings, LLC Sorrento Therapeutics, Inc. (NasdaqCM:SRNE) Shire Pharmaceutical Holdings Ireland Limited Grifols, S.A. (CATS:GRF)

11.6

-

-

-

No No

62.2x 167.1x

Yes

Agility Health, Inc. (TSXV:AHI) HealthcareScene.com

3,555.4

8.3x

1,675.0

3.0x

-

-

No

10.6

-

-

-

No

-

-

-

-

No

11/8/2013

Wolverine Anesthesia Consultants MD, PA

Orlando Health, Inc.

11/8/2013

Visual Intelligence, LLC, Healthcare Analytics Platform SG Austria Pte. Ltd., Worldwide Rights to LiveCell Encapsulation Technology for Diabetes RMD Instruments Corporation, Assets Of XRay Florescence Lead Paint Detector Product Line Santarus, Inc. (NasdaqGS:SNTS)

Visual Intelligence, LLC

Alpha Capital AG; Sandor Advisors, LLC; Hudson Bay Capital Management LP; Melechdavid, Inc.; HS Contrarian Investments LLC Team Health Holdings, Inc. (NYSE:TMH) QualMetrix, LLC

-

-

-

-

No

SG Austria Pte. Ltd.

Nuvilex, Inc. (OTCPK:NVLX)

1.0

-

-

-

No

Dynasil Products, Inc.

PROTEC Instrument Corporation

0.9

-

-

-

No

1,979.7

5.9x

24.3x

26.4x

Yes

11/7/2013 11/7/2013

11/7/2013

11/7/2013 11/7/2013 11/6/2013 11/6/2013

Coordinated Home Health Care, Inc., Personal Care Business Paragon Medical, Inc. 200 Acres Five Manufactured Home Communities In Ohio And New York Mick Radio-Nuclear Instruments, Inc.

S.A.C. Capital Management, LLC; Salix Pharmaceuticals, Inc. Visium Asset Management, LLC; HealthCare Royalty Partners; Cosmo Pharmaceuticals S.p.A. Coordinated Home Health Care, Inc. Addus HomeCare Corporation (NasdaqGM:ADUS) Seidler Equity Partners; Altaris Beecken Petty O'Keefe & Company Capital Partners, LLC UMH Properties Inc. (NYSE:UMH) -

Eckert & Ziegler BEBIG S.A. (ENXTBR:EZBG)

-

-

-

-

No

-

-

-

-

Yes

11.8

-

-

-

No

-

-

-

-

No

13

M&A Detail December 2013

Announced

Announced U.S. Healthcare & Life Sciences M&A (Continued)

Target

11/1/2013 11/1/2013

Medical Supplies of America, Blood Plasma Supply Operations Capital Eye Medical Group Nine Nursing Centers BHG Dyersburg Treatment Center Vantage Health, Inc. (OTCBB:VNTH) SunCrest Healthcare, Inc. Senior Home Care, Inc. Thermionics Corporation Eligibility Plus, Inc. The Ohio Neurosurgical Institute Inc. Five Post-Acute and Long-Term Care Skilled Nursing Facilities in Ohio and Arkansas Merck & Co. Inc., Portfolio of 11 Branded Finished Dose Form Molecules Prima Tech USA KLMK Group, Inc.

11/1/2013 11/1/2013 11/1/2013

Urgent Medical Care Progenicare, LLC Ohio Cancer Specialists, Inc.

11/6/2013 11/6/2013 11/5/2013 11/5/2013 11/4/2013 11/4/2013 11/4/2013 11/4/2013 11/4/2013 11/4/2013 11/1/2013 11/1/2013

Seller

Buyer

Medical Supplies of America LLC

HemaSource, Inc.

HCP, Inc. (NYSE:HCP) Bayview Terrace Limited MBF Healthcare Partners, L.P. MTS Health Investors, LLC -

NVISION Laser Eye Centers Inc. Kindred Healthcare Inc. (NYSE:KND) Behavioral Health Group, Inc. Nanobeak Inc. Almost Family Inc. Kindred Healthcare Inc. (NYSE:KND) Carex Health Brands, Inc. Hawes Financial Group, Inc. The Clinical Neuroscience Institute Aviv REIT, Inc. (NYSE:AVIV)

Merck & Co. Inc. (NYSE:MRK)

Aspen Global Incorporated

Patriot Capital, L.P.; Azalea Capital, LLC -

Neogen Corp. (NasdaqGS:NEOG) CBRE Healthcare U.S. Healthworks, Inc. Sheridan Legacy Group The Cleveland Clinic Foundation

Enterprise Value ($mm)

Enterprise Value / LTM Sales EBITDA EBIT

Private Equity Involvement

-

-

-

-

No

83.0 75.5 95.0 42.2

9.2x 0.5x 0.7x -

-

-

No No No No Yes Yes No No No No

600.0

2.4x

-

-

No

12.9 -

-

-

-

No Yes

-

-

-

-

No No No

14

M&A Detail December 2013

Contacts

Turner Bredrup

James Clark

Managing Director

Managing Director

Todd Morris Managing Director

[email protected]

[email protected]

[email protected]

+1 (804) 915-0110

+1 (804) 915-0119

+1 (415) 217-3412

Cheairs Porter

Andy Dixon

Geoff Smith

Managing Director

Director

Director

[email protected]

[email protected]

[email protected]

+1 (804) 915-0130

+1 (415) 217-3419

+1 (804) 915-0195

Paul Hepper

Andy Hewlett

Whit Knier

Vice President

Vice President

Vice President

[email protected]

[email protected]

[email protected]

+1 (804) 932-1326

+1 (415) 217-3427

+1 (804) 932-1321

15

Two International Place 24th Floor Boston, MA 02110 Phone: +1 (617) 482-7501 Fax: +1 (617) 482-7503

1900 East 9th Street 20th Floor Cleveland, OH 44114 Phone: +1 (216) 689-2400 Fax: +1 (216) 689-2401

Bockenheimer Landstrasse 33-35 60325 Frankfurt am Main Germany Phone: +49 069 3650638 00 Fax: +49 069 3650638 01 63 Brook Street London, W1K 4HS Phone: +44 20 7518 8900 Fax: +44 20 7526 2187

222 South Ninth Street Suite 3350 Minneapolis, MN 55402 Phone: +1 (612) 359-2700 Fax: +1 (612) 359-2701

1600 Market Street 21st Floor Philadelphia, PA 19103 Phone: +1 (267) 675-5900 Fax: +1 (267) 675-5901

1001 Haxall Point 9th Floor Richmond, VA 23219 Phone: +1 (804) 648-0072 Fax: +1 (804) 648-0073

575 Market Street 31st Floor San Francisco, CA 94105 Phone: +1 (415) 288-4260 Fax: +1 (415) 288-4269

Sources: Capital IQ. Thomson Financial. S&P. Reuters. Bloomberg. Irving Levin Associates. Harris Williams & Co. (www.harriswilliams.com) is a preeminent middle market investment bank focused on the advisory needs of clients worldwide. The firm has deep industry knowledge, global transaction expertise, and an unwavering commitment to excellence. Harris Williams & Co. provides sell-side and acquisition advisory, restructuring advisory, board advisory, private placements, and capital markets advisory services. Investment banking services are provided by Harris Williams LLC, a registered broker-dealer and member of FINRA and SIPC, and Harris Williams & Co. Ltd, which is authorised and regulated by the Financial Conduct Authority. Harris Williams & Co. is a trade name under which Harris Williams LLC and Harris Williams & Co. Ltd conduct business. THIS REPORT MAY CONTAIN REFERENCES TO REGISTERED TRADEMARKS, SERVICE MARKS AND COPYRIGHTS OWNED BY THIRD-PARTY INFORMATION PROVIDERS. NONE OF THE THIRDPARTY INFORMATION PROVIDERS IS ENDORSING THE OFFERING OF, AND SHALL NOT IN ANY WAY BE DEEMED AN ISSUER OR UNDERWRITER OF, THE SECURITIES, FINANCIAL INSTRUMENTS OR OTHER INVESTMENTS DISCUSSED IN THIS REPORT, AND SHALL NOT HAVE ANY LIABILITY OR RESPONSIBILITY FOR ANY STATEMENTS MADE IN THE REPORT OR FOR ANY FINANCIAL STATEMENTS, FINANCIAL PROJECTIONS OR OTHER FINANCIAL INFORMATION CONTAINED OR ATTACHED AS AN EXHIBIT TO THE REPORT. FOR MORE INFORMATION ABOUT THE MATERIALS PROVIDED BY SUCH THIRD PARTIES, PLEASE CONTACT US AT +1 (804) 648-0072. The information and views contained in this report were prepared by Harris Williams & Co. (“Harris Williams”). It is not a research report, as such term is defined by applicable law and regulations, and is provided for informational purposes only. It is not to be construed as an offer to buy or sell or a solicitation of an offer to buy or sell any financial instruments or to participate in any particular trading strategy. The information contained herein is believed by Harris Williams to be reliable but Harris Williams makes no representation as to the accuracy or completeness of such information. Harris Williams and/or its affiliates may be market makers or specialists in, act as advisers or lenders to, have positions in and effect transactions in securities of companies mentioned herein and also may provide, may have provided, or may seek to provide investment banking services for those companies. In addition, Harris Williams and/or its affiliates or their respective officers, directors and employees may hold long or short positions in the securities, options thereon or other related financial products of companies discussed herein. Opinions, estimates and projections in this report constitute Harris Williams’ judgment and are subject to change without notice. The financial instruments discussed in this report may not be suitable for all investors, and investors must make their own investment decisions using their own independent advisors as they believe necessary and based upon their specific financial situations and investment objectives. Also, past performance is not necessarily indicative of future results. No part of this material may be copied or duplicated in any form or by any means, or redistributed, without Harris Williams’ prior written consent.

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