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transcript
8/18/2019 BDX Presentation at JPM 2016_FINAL
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34th Annual J.P. MorganHealthcare Conference
Vincent A. ForlenzaChairman, Chief ExecutiveOfficer and President
January 13, 2016
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Forward-Looking Statements
• These materials include forward-looking statements and it’s possiblethat actual results could differ from our expectations. Factors thatcould cause such differences appear in our fourth quarter earningsrelease and in our recent SEC filings
Non-GAAP Financial Measures
• These materials also include Non-GAAP financial measures. Areconciliation to the comparable GAAP measures can be found in ourfourth quarter 2015 earnings release, the financial schedules attachedthereto and the related earnings call slides, all of which are posted
on the “Investors” section of the BD.com website
FXN = Estimated foreign exchange-neutral currency growth. $ = Dollars in millions except per share data.Comparable FXN = Estimated foreign exchange-neutral currency growth including BD and CareFusion in the current and prior year periods.Note: All figures on accompanying slides are rounded. Totals may not add due to rounding. Percentages are based on un-rounded figures.
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Topics for Discussion
Performance and Outlook
Advancing the World of Health
Accelerating Our Strategy
Growth Drivers and Value Creation
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Topics for Discussion
Performance and Outlook
Advancing the World of Health
Accelerating Our Strategy
Growth Drivers and Value Creation
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BD is Well Positioned to Enable NewHealthcare Delivery Models
• Healthcare industry consolidation: Across Payors, Providers and Consumers
• Shift in reimbursement models: From “Fee for Service” to “Fee for Value”
• Outcome focused: Population health management and consumer driven care
• Technology evolution continues: Digital Health
Continuum of Care
Home
Long-term Care,Skilled Nursing Facilities
Ambulatory Care Hospital
Primary Care Physician Physician
Retail PharmacyRetail Pharmacy
Home
Key Macro Healthcare Trends
Payers
Consumers
ValueBased
Reimburse-ment
Providers
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AcceleratingOur Strategy
DISCOVERY | DIAGNOSTICS | DELIVERY
SOLUTIONS ACROSS CARE CONTINUUM:
Serve as a leading medicaltechnology companydelivering world-class qualityand innovative healthcaresolutions
Improve lab efficiencyand patient outcomesfrom sample todiagnostic result
Optimize drugdelivery, medicationmanagement, andchronic diseasetreatment across thecare continuum
Enabled by Informatics
BDX
MedicalLife
Sciences
Advancing theWorld of Health
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Topics for Discussion
Performance and Outlook
Advancing the World of Health
Accelerating Our Strategy
Growth Drivers and Value Creation
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#1 in med managementsolutions
Broad diabetes drug
delivery & diseasemanagement leader
Preferred partner intargeted self-injectionsolutions
A leader in infection
prevention solutions
A leading player inrespiratory and anesthesiasolutions
Medical Transformation: FromSupplies to Medical Management
#3/4 in devices for medmanagement
Leader in diabetes penneedles & syringes
Self-Injection Offering
Focused HAI effort
Disparate positions & OEMsin respiratory
From To
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BD Medical:Innovative Products and Solutions
Note: Fiscal year 2015 comparable revenues in billions. Totals may not add due to rounding.
MedicationManagement
Chronic DiseaseManagement &
Adherence
Addressing NeedsAcross the
Continuum of Care
Medication
ManagementSystems
Medication &
ProceduralSolutions
Diabetes
Care
Pharmaceutical
Systems
Respiratory
Solutions
$3.4B $2.1B $1.0B $0.9B $1.2B
$8.5B Revenue
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Leader in Medication Management
Healthcare IT/Electronic Medical Record
BD Smartworks & Knowledge Portal
Integrating Products, Informatics and Interoperability
Pharmogistics Cato & Phaseal Pyxis ES Alaris MedMined Smartworks
Procure Prepare Track & Dispense Administer & Document
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Life Sciences: Lab ProductivityFrom Discovery to Diagnosis
Legacy flow cytometryportfolio
Products supporting portfoliomicrobiology lab
Limited molecular menu andfragmented platforms
No presence in genomics
Advancing discovery withmulti parameter instrumentand reagent solutions
Reinventing microbiologywith automation andinformatics
Improving moleculardiagnostics throughautomation, differentiatedassays and standardization
Building leadership fromsample collection tosequence ready
Isolate1
E.coli (prelim)
Isolate2
E.facaelis (prelim)
From To
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BD Life Sciences: Improving LabEfficiency and Outcomes
Note: Fiscal year 2015 comparable revenues in billions. Totals may not add due to rounding.
$1.4B $1.3B $1.1B
$3.8B Revenue
Diagnostic
Systems
Preanalytical
Systems
Biosciences
AdvancingCellular
Research
Improving Lab Efficiencyand Patient Outcomes
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Improving Lab Efficiency andOutcomes
Increasing diagnostic efficiency andquality for better clinical outcomes
From the Clinical Laboratory to the Doctor’s Office
InfoStratus: Integrated Workflow Management and Data Analytics
Sample Processing Diagnostics and Laboratory TestingPost-
Analytics
BD KiestraAutomation
‘Smart’Imaging
BACTEC, PhoenixMicrobiology Solutions
BD MAXTM
Molecular Veritor
Point-of-CareRapid Result
Reporting
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AdministerDrug
Connecting Diagnosis andMedication Management
DIAGNOSIS DELIVERY
Infectious Disease / HAI’s Pharmacy& Prepare
DispenseMedicine
MonitorPatient
SmartWorks / Informatics
HIT Systems
Patient Floor
Pharmacy and Drug Compounding
Clinical Diagnostics Laboratory
Hospital
MedMinedInformatics
InfoStratus
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54%46%
International$5.7B+7%
EmergingMarkets
$2.0B+9%16%
China
$0.6B+15%5%
Leveraging Our InternationalInfrastructure
$B Revenue
FXN Growth
% of Sales
Diverse Geographic Revenue Base Opportunities Across the Globe
US$6.7B+4%
Note: All figures above reflect FY 2015 comparable actual results.
12.4B
U.S.• Outcome focus• IDN consolidation• Cross-selling
International• Registration• Safety Adoption
Emerging Markets• Geographic Expansion • Partnering• Raise care standards
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Topics for Discussion
Performance and Outlook
Advancing the World of Health
Accelerating Our Strategy
Growth Drivers and Value Creation
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• New brand launch
• “Best of the Best” approach
• Key leadership in place
• Actively registering CFN
products in x-US markets,as anticipated
• Confidence in ability to deliverrevenue synergies in FY 2017
• Raised cost synergy target to
$325 to $350M by FY 2018• Incremental opportunitiesacross the organizationaltransformation, includingmanufacturing and functions
• Focus of the entire company
• Dedicated IntegrationManagement Office
• Completed commercialintegration for key accounts
Integration Off to a Great Start
Integration
Revenue SynergiesCost Synergies
Talent RetentionAnd Culture
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2.9%3.2%
4.2% 5.0%
4.7%1.1%
1.2%0.2% 0.6%
0%
1%
2%
3%
4%
5%
6%
FY2011 FY2012 FY2013 FY2014 FY2015 FY2016
R e v e n u e F X N
G r o w t h
Organic Growth Growth from Acquisitions and One-time Items
Accelerating Organic Revenues
5.4%
2.9%
4.5% to5.0%
4.3%
5.2% 5.3%
BD + CareFusion
(1) (2)
FY2011 – FY2014: FXN = Estimated foreign exchange-neutral currency growth; FY2015 – FY2016: Comparable FXN = Estimatedforeign exchange-neutral currency growth including BD and CareFusion in current and prior year periods.
(1) FY2011 adjusted for prior-year impact related to pandemic flu, U.S. stimulus spending and Japan supplemental spending.(2) FY2016 Guidance Estimate which excludes the impact from a distribution agreement change in the Respiratory Solutions
business and non-annualized acquisitions.
BD 5.1%CFN 3.8%
BD ~5%CFN ~4%
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Margin Gains and Earnings GrowthMargin FXN Expansion
FY 2015 FY 2016
~100 bps
130 to 150 bps Key Drivers
• Transformation across functionsthrough: – Leveraging of shared service centers – Leaning infrastructure – End to end process improvement
• Rationalizing and automatingmanufacturing footprint
Earnings FXN Growth
FY 2015 FY 2016
21.2%
22 to 23%
Key Drivers
• Mid-single-digit revenue growth• Margin expansion driven by base
plans + synergies• Efficient capital and tax structures
Note: Margin expansion excludes currency and pension impacts.
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Significant Operating Cash Flow
Adjusted Operating Cash Flow
$1.64 $1.69 $1.72$1.75
$2.10
~$2.60
FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016
$ in Billions
Note: FY 2016 reflects guidance.
• Reinvest for growth: R&D,Emerging Markets, Capital Spend
and M&A
• Fund a rising annual dividend
• Share repurchase programsuspended, except in the case of
divestitures
Capital Allocation Strategy
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Advancing the World of HeathNamed to Fortune Magazine’s first-ever Change the World list
Innovation: Advancing the quality, accessibility, safety and affordabilityof healthcare around the world
Access: Improving Global Health through Public Private Partnerships,Product Development Partnerships, and Advocacy and Policy Alignment
Efficiency: Reducing environmental footprint across our supply chainwhile addressing climate change impacts
Empowerment: Advancing our purpose-driven culture
FORTUNEChange the World
2015OutstandingCorporate Innovator
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Closing Remarks
Accelerating Our StrategyProviding healthcare solutions across carecontinuum addressing global health needs
Growth in Medical and Life Sciences Strong Core, Organic Innovation,Strategic Acquisitions & Partnerships
Focused on Driving Sustainable ValueFor our customers, our end markets,and our stakeholders
DISCOVERY | DIAGNOSTICS | DELIVERY
SOLUTIONS ACROSS CARE CONTINUUM:
Advancing the World of Health
Strong Performance and OutlookAccelerating Organic Revenues,Continued Margin Expansion,High Quality of Earnings
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Thank you