HEALTHCARE & LIFE SCIENCES...federal Medicaid spending by $383.2 billion from 2017 through 2026,...

www.harriswilliams.com

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 a private limited company incorporated under English law with its registered office at 5th Floor, 6 St. Andrew Street, London EC4A 3AE, UK, registered with the Registrar of Companies for England and Wales (registration number 7078852). Harris Williams & Co. Ltd is authorized 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.

HEALTHCARE & LIFE SCIENCES

INDUSTRY UPDATE │ JUNE 2017


PAGE |


WHATWE’RE READING

1

CONTENTS

PUBLIC MARKETS OVERVIEW

EQUITY MARKETS OVERVIEW

M&A OVERVIEW

DEBT MARKETS OVERVIEW

HEALTHCARE & LIFE SCIENCESPUBLIC COMPARABLES

M&A TRANSACTIONS

CONTACTSTurner BredrupManaging [email protected]+1 (804) 915-0110

James ClarkManaging [email protected]+1 (804) 915-0119

Andy DixonManaging [email protected]+1 (415) 217-3419

Cheairs PorterManaging [email protected]+1 (804) 915-0130

Geoff SmithManaging [email protected]+1 (804) 915-0195

Paul [email protected]+1 (804) 932-1326

Whit [email protected]+1 (804) 932-1321

Eugene BordVice [email protected]+1 (804) 915-0180

Tyler BradshawVice [email protected]+1 (804) 887-6121

Mervyn HanVice [email protected]+1 (804) 887-6087

Andy HewlettVice [email protected]+1 (415) 217-3427

Ricky NgVice [email protected]+1 (415) 217-3437

Nick OwensVice [email protected]+1 (804) 887-6027

GOVERNMENT | CMS PREDICTS GOP BILL TO REDUCE COVERAGE BY13MM

The CMS Office of the Actuary on Tuesday estimated that the House-passed

American Health Care Act would reduce insurance coverage by 13 million people

by 2026, 10 million less than the Congressional Budget Office’s (CBO) prediction. The

CMS Office of the Actuary projects that by 2026, 43 million people would be uninsured, compared with 31 million under the current law.

The CMS Office of the Actuary also estimated that average net premiums paid in

2026 would be about 5% higher than under the current law, and the average cost-

sharing amounts would be about 61% higher. This would result in a reduction of

federal Medicaid spending by $383.2 billion from 2017 through 2026, which is far less

than the $834 billion in Medicaid cuts projected by the CBO.

In addition, the CMS Office of the Actuary projects that the Medicare Hospital

Insurance Trust Fund for inpatient care will become insolvent in 2026, two years earlier

than under current law, given the repeal of the ACA’s additional Medicare payroll

tax on wealthy Americans coupled with hospitals serving a disproportionate share of

uninsured patients.

Under the CMS Office of the Actuary’s model, the actuary predicted that 25% of

states would seek waivers under the new plan, which could create instability in the

individual insurance market, make premiums unaffordable for people seeking to buy

comprehensive health plans, and substantially hike out-of-pocket costs for people

seeking maternity, mental health and substance abuse services.

A link to the original article can be found here.



ECONOMY | LESS THAN HALF OF PHYSICIANS ARE INDEPENDENT

For the first time ever, less than half of practicing physicians in the U.S. owned their

medical practice in 2016. According to an American Medical Association study, only

47.1% of physicians had ownership stakes in a medical practice, down from 53.2% in

2012. The report indicated that doctors, especially young doctors, have been shifting

from owning their own practice to joining larger ones.

Research shows that ownership and employment shifts reflect the industry’s

increasing compliance costs and new payment models. Maintaining the necessary

information technology and quality and safety compliance often requires a larger

asset base to spread costs, while payment reforms like accountable care

organizations value an integrated care model.

Health systems have also been aggressively acquiring physician practices as they aim to better align physician networks to reduce medical variations, improve

outcomes, and satisfy payment reforms that require the broader population to

remain healthy. However, this trend has seemingly stalled according to recent data,

as hospitals have “as many practices as they can handle.” This trend is supported

by the fact that physician compensation is one of the fastest growing expenses in

health systems, as it has become as high as 10% of total expenses for some systems.

A link to the original article can be found here.

http://www.harriswilliams.com/

mailto:[email protected]













http://www.modernhealthcare.com/article/20170613/NEWS/170619965?utm_source=modernhealthcare&utm_campaign=am&utm_medium=email&utm_content=20170613-NEWS-170619965

http://www.modernhealthcare.com/article/20170531/NEWS/170539971?utm_source=modernhealthcare&utm_medium=email&utm_content=20170531-NEWS-170539971&utm_campaign=am

PAGE |

Specialty Pharmacy

Behavioral Health / Management

Assisted Living

Acute-Care Hospitals

Physician Practice Management

Retail Pharmacy

Dialysis Services

Specialty Pharmacy Management

Healthcare Staffing

Medical / Surgical / Dental Supplies & Distribution

Long-Term Care

HW&Co. HCLS Composite Index

Dental Products

Specialty Managed Care

Life Sciences Tools

S&P 500

Information Services

Surgicenters / Rehabilitation

Contract Pharma Manufacturing

Medical Devices and Products

Contract Research Organizations

HMO - Medical

Durable Medical Equipment

Diagnostic Imaging

Clinical Laboratories

Home Care, Hospice, and Home Infusion

Disease Management

(65.0%) (55.0%) (45.0%) (35.0%) (25.0%) (15.0%) (5.0%) 5.0% 15.0% 25.0% 35.0% 45.0% 55.0% 65.0% 75.0% 85.0% 95.0% 105.0% 115.0%

PUBLICMARKETS OVERVIEW(1)

2

Key Trading Statistics (detail begins on page 6)

Public Company Sector Performance

(12-month % change in stock price)



Change in Stock Price

3 mos. 12 mos. Revenue EBITDA Revenue EBITDA

Clinical Laboratories 3 $47,856 1.4% 40.9% 2.5x 12.6x 2.4x 11.9x

Contract Pharma Manufacturing 2 9,022 6.6% 19.6% 4.1x 16.6x 3.7x 14.4x

Contract Research Organizations 8 59,900 23.1% 29.6% 3.0x 15.6x 3.0x 12.8x

Disease Management 2 8,654 22.1% 97.9% 3.0x 17.6x 2.8x 13.0x

Healthcare Staffing 4 18,816 (16.9%) (9.1%) 1.2x 12.2x 1.1x 9.5x

HMO - Medical 8 400,204 8.6% 31.6% 0.9x 11.5x 0.8x 9.8x

Information Serv ices 12 45,380 14.5% 15.0% 4.2x 17.2x 3.8x 12.9x

Specialty Managed Care 3 9,254 4.8% 12.1% 1.7x 10.1x 5.9x 29.9x

Specialty Pharmacy 1 1,283 26.5% (47.4%) 0.3x 14.0x 0.3x 12.1x

Retail Pharmacy 3 210,739 (6.2%) (20.3%) 0.6x 9.7x 0.6x 9.9x

Specialty Pharmacy Management 2 49,747 (7.5%) (14.0%) 0.5x 8.0x 0.5x 7.5x

Dental Products 2 150,646 4.9% 11.8% 4.3x 18.0x 4.1x 15.3x

Durable Medical Equipment 3 18,406 16.4% 32.2% 2.8x 15.6x 2.6x 13.3x

Life Sciences Tools 4 161,106 13.6% 14.2% 4.3x 16.7x 4.1x 14.8x

Medical Devices and Products 13 835,038 6.7% 24.2% 4.8x 17.6x 4.5x 15.0x

Medical / Surgical / Dental Supplies & Distribution 6 117,948 (1.3%) (7.7%) 0.2x 9.5x 0.2x 9.5x

Acute-Care Hospitals 4 104,990 (7.7%) (21.2%) 1.0x 8.0x 1.0x 7.4x

Assisted Liv ing 2 9,022 (11.1%) (23.9%) 2.3x 13.8x 2.3x 12.3x

Diagnostic Imaging 3 10,886 21.0% 38.2% 1.6x 8.6x 2.2x 11.2x

Dialysis Serv ices 3 60,789 (4.5%) (14.3%) 1.7x 8.7x 1.6x 9.5x

Home Care, Hospice, and Home Infusion 6 8,857 18.9% 42.0% 1.7x 17.2x 1.6x 13.3x

Long-Term Care 3 6,394 (2.4%) (7.4%) 0.7x 9.6x 0.6x 6.0x

Physician Practice Management 1 6,907 (23.7%) (20.7%) 2.1x 10.6x 1.9x 10.7x

Behavioral Health / Management 5 25,038 (9.5%) (27.6%) 1.1x 8.8x 1.1x 7.0x

Surgicenters / Rehabilitation 4 16,030 0.0% 16.9% 1.9x 10.4x 1.7x 10.0x

Payor, Provider, & Pharmacy Support Serv ices 48 $860,854 4.3% 17.7% 1.3x 12.0x 1.2x 10.2x

Products & Devices 28 $1,283,145 6.2% 15.4% 4.2x 15.8x 4.0x 13.7x

Provider-Based Serv ices 31 $248,913 (0.1%) 3.2% 1.8x 10.3x 1.7x 9.4x

HW&Co. HCLS Composite Index 107 $2,392,912 3.9% 8.5% 3.0x 14.1x 2.8x 12.1x

S&P 500 2.0% 15.0%

Pro

du

cts

&

De

vic

es

Pro

vid

er-

Ba

sed

Se

rvic

es

Median TEV/

Forward MulitplesSectorNumber of

Companies

Aggregate

Enterprise Value

($ mm)

Median TEV/

LTM Multiples

Pa

yo

r, P

rov

ide

r, &

Ph

arm

ac

y

Su

pp

ort

Se

rvic

es

PAGE |

126.0%

130.7%

144.8%

40%

60%

80%

100%

120%

140%

160%

180%

Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 Mar-16 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17

S&P 500 Dow Jones U.S. Healthcare Index HW&Co. HCLS Index

EQUITYMARKETS OVERVIEW

3

Healthcare & Life Sciences Industry Stock Performance(1)

Top Equity Offerings(2)

(by proceeds)



Closing Date Issuer Ticker Transaction Type Gross Proceeds ($ mm)

05/23/17 Alynlam Pharmaceuticals NASDAQ:ALNY Follow-On $369.7

05/04/17 Biohaven Pharmaceutical Holding NYSE:BHVN Initial Public Offering 168.3

05/23/17 Achaogen Inc. NASDAQ:AKAO Follow-On 125.9

05/19/17 Halozyme Therapeutics Inc. NASDAQ:HALO Follow-On 125.0

05/17/17 G1 Therapeutics NASDAQ:GTHX Initial Public Offering 105.0

05/05/17 Ovid Therapeutics NASDAQ:OVID Initial Public Offering 75.0

05/09/17 Cytokinetics NASDAQ:CYTK Follow-On 75.0

05/08/17 Accelerate Diagnostics, Inc. NASDAQ:AXDX Follow-On 73.8

05/04/17 UroGen Pharma Ltd. NASDAQ:URGN Initial Public Offering 58.5

05/31/17 Nanostring Technologies NASDAQ:NSTG Follow-On 50.4

05/25/17 Syndax Pharmaceuticals NASDAQ:SNDX Follow-On 49.7

05/24/17 Albireo Pharma NASDAQ:ALBO Follow-On 45.1

05/30/17 Senseonics Holdings NYSE:SENS Follow-On 41.0

05/25/17 Corium International NASDAQ:CORI Follow-On 35.0

05/01/17 Cytrx Corp. NASDAQ:CYTR Follow-On 15.0

05/08/17 Ampliphi Biosciences NYSE:APHB Follow-On 10.4

PAGE |

HC&LS Industry Number of

Segment Companies

Healthcare Facilities 28

Healthcare Serv ices 121

Healthcare Equipment 39

Pharmaceuticals 21

Healthcare Technology 10

Life Sciences Tools & Serv ices 4

Healthcare Supplies 8

Healthcare Distributors 5

Biotechnology 15

Managed Healthcare 6

M&A OVERVIEW(1)

4

Announced Healthcare & Life Sciences M&A

Healthcare & Life Sciences M&A Trends

Announced Private Equity M&A Activity

QUARTERLY M&A ACTIVITY

HEALTHCARE TRANSACTION HIGHLIGHTS

ANNOUNCED HEALTHCARE & LIFE SCIENCES TRANSACTIONS

MEDIAN HEALTHCARE & LIFE SCIENCES TRANSACTION MULTIPLES

PEG INVESTMENTS BY SEGMENT (LAST 3 YEARS) PEG INVESTMENTS AND EXITS

Note: Transactions based on publicly available information

LTM DEAL STATISTICS



$101.6 $108.2

$236.6

$576.0

$277.9

$89.4

0

200

400

600

800

1,000

1,200

1,400

$0

$50

$100

$150

$200

$250

$300

$350

$400

$450

$500

$550

$600

2012 2013 2014 2015 2016 2017YTD

Nu

mb

er o

f Tran

sac

tion

sAg

gre

ga

te T

ran

sac

tio

n V

alu

e

($ in

billio

ns)

Volume Total Deals

10.9x 10.0x

13.6x 14.2x

13.0x 12.7x

0.0x

0.5x

1.0x

1.5x

2.0x

2.5x

3.0x

3.5x

4.0x

4.5x

5.0x

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x

14.0x

16.0x

18.0x

2012 2013 2014 2015 2016 2017YTD

EV

/ LTM S

ale

s Mu

ltiple

EV

/ L

TM E

BIT

DA

Mu

ltip

le

EBITDA Multiple Revenue Multiple

304 290 280 291 303 313

368

309 306

250225

182 175

2214

1016

1112

15

18 21

48

49

45 52

0

50

100

150

200

250

300

350

400

1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17

Nu

mb

er

of Tr

an

sac

tio

ns

PE Buyer Strategic Buyer

116

77

44

68 67 6661 62

56

163

75

93

52 48

78

124

139 143 144

130

41

10

20

40

60

80

100

120

140

160

180

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017YTD

Nu

mb

er

of Tr

an

sac

tio

ns

Number of Investments Number of Exits

Announced Target Buyer

5/25/2017 PartsSource, Inc. Great Hill Partners LP

5/22/2017 EyeCare Serv ices Partners Holdings LLC Harv est Partners LP

5/18/2017 Cranial Technologies, Inc. Beecken Petty O'Keefe & Co. LP

5/15/2017 Clev eland Skin Pathology Laboratory, Inc. Summit Partners LP; KRG Capital LLC

5/11/2017 ProEx Physical Therapy Thomas H. Lee Partners LP

5/10/2017 Surgery Partners, Inc. Bain Capital Priv ate Equity LP

5/9/2017 ProPhase LLC WIRB-Copernicus Group, Inc.

5/9/2017 Dermatology Consultants of Broward GTCR LLC; Riv erchase Dermatology & Cosmetic Surgery LLC

5/8/2017 Medical Solutions LLC TPG Growth LLC; TPG Capital Adv isors LLC

5/8/2017 WRB Communications, Inc. Diplomat Pharmacy, Inc.

5/5/2017 VWR Corp. New Mountain Capital LLC

5/1/2017 Tecomet, Inc. Charlesbank Capital Partners LLC

5/1/2017 Synergy Emergency Physicians, Inc. Team Health Holdings, Inc.

Aggregate Number Median Transaction Multiples

Value ($bn) of Deals TEV/Rev TEV/EBITDA

$205.5 940 8.8x 17.3x

PAGE |

DEBTMARKETS OVERVIEW

Key Credit Statistics(3)

QUARTERLY HEALTHCARE LOAN VOLUME AVERAGE SPREAD ON HEALTHCARE LOANS

Select Healthcare & Life Sciences Debt Offerings(4)

(by deal amount)

CREDIT METRICS AVERAGE SECONDARY SPREAD



$0

$3

$6

$9

$12

$15

$18

$21

$24

1Q12 3Q12 1Q13 3Q13 1Q14 3Q14 1Q15 3Q15 1Q16 3Q16 1Q17

Loa

n V

olu

me

by

Qu

art

er

($ in

billio

ns)

Pro Rata Institutional

L + 0

L + 100

L + 200

L + 300

L + 400

L + 500

2011 2012 2013 2014 2015 2016 1Q17

Av

era

ge

Sp

rea

d O

ve

r LI

BO

RRevolving Credit / Term Loan A Weighted-Average Institutional

L + 0

L + 200

L + 400

L + 600

1Q12 3Q12 1Q13 3Q13 1Q14 3Q14 1Q15 3Q15 1Q16 3Q16 1Q17

Av

era

ge

Sp

rea

d O

ve

r LI

BO

R

0.0x

2.0x

4.0x

6.0x

Debt/EBITDA Senior Debt/EBITDA EBITDA/Cash

Interest

EBITDA -

Capex/Cash

Interest

EB

ITD

A M

ultip

le

2011 2012 2013 2014 2015 2016 1Q17

Date Effective Borrower Name Description Amount ($ mm) Tranche Rating Spread

05/12/17 Becton Dickinson & Co Surgical and medical instruments $4,500.0 Term Loan A Ba1 / BBB+ L+ 150

05/01/17 Tecomet Inc Surgical appliances and supplies 835.0 Term Loan B B2 / B L+ 375

05/01/17 Varex Imaging Corporation X-ray apparatus and tubes 600.0 Term Loan A NR / NR L+ 250

05/02/17 Caidan Holding Co Hospital/medical serv ice plans 475.0 Term Loan NR / NR L+ 150

05/19/17 Equian LLC Home health care serv ices 455.0 Term Loan B2 / B L+ 375

05/09/17 AmeriHealth Caritas Offices/clinics of med'l doctors 450.0 364-Day Facility NR / NR L+ 138

05/01/17 KePro Health and allied serv ices, nec 330.0 Term Loan Caa2 / CCC+ L+ 925

05/24/17 CityMD General med'l/surgical hospitals 255.0 Term Loan B B3 / B- L+ 400

05/08/17 Addus Healthcare Inc Home health care serv ices 250.0 Term Loan A NR / NR L+ 250

05/19/17 BayMark Health Serv ices Inc Home health care serv ices 213.0 Term Loan B NR / NR L+ 475

05/05/17 MB Medical Operating LLC Offices/clinics of med'l doctors 36.9 Revolver/Line >= 1 Yr. NR / NR L+ 400

5

PAGE |

Stock Price

% Change 52 Week

5/31/2017 3 mos. 12 mos. High Low Revenue EBITDA EBIT Revenue EBITDA EBIT Revenue EBITDA Revenue EBITDA

Clinical Laboratories

Laboratory Corporation of America Holdings $139.00 (2.3%) 8.6% $146.63 $119.51 $14,220 $5,921 $366 $20,069 $9,721 $1,927 $1,422 Mar-17 Dec-16 $10,039 $2,049 $1,720 2.1x 10.4x 2.0x 9.8x

Quest Diagnostics Incorporated 108.77 11.6% 40.9% 108.90 75.20 14,883 3,731 367 18,812 7,551 1,498 1,249 Mar-17 Dec-16 7,759 1,578 1,322 2.5x 12.6x 2.4x 11.9x

VCA Inc.(*) 92.13 1.4% 41.9% 92.14 59.51 7,487 1,386 90 8,975 2,632 509 397 Mar-17 Dec-16 2,927 578 464 3.4x 17.6x 3.1x 15.5x

Number of Companies 3 Median: 1.4% 40.9% Total $36,589 $47,856 $19,903 $20,725 2.5x 12.6x 2.4x 11.9x

Market Cap. Weighted Average: 4.1% 28.6% 2.5x 12.8x 2.4x 11.8x

Contract Pharma Manufacturing

Cambrex Corporation $53.80 (4.5%) 10.0% $62.95 $38.30 $1,752 $0 $99 $1,696 $501 $163 $136 Mar-17 Dec-16 $553 $175 $144 3.4x 10.4x 3.1x 9.7x

West Pharmaceutical Serv ices, Inc. 97.02 17.6% 29.2% 97.93 70.17 7,136 229 169 7,326 1,535 322 231 Mar-17 Dec-16 1,659 383 278 4.8x 22.7x 4.4x 19.1x



Contract Research Organizations

Albany Molecular Research, Inc. $19.46 30.0% 34.0% $20.56 $12.51 $835 $641 $35 $1,431 $629 $60 $1 Mar-17 Dec-16 $745 $144 $98 2.3x 23.8x 1.9x 10.0x

Catalent Inc 35.53 23.8% 26.4% 36.20 20.94 4,440 2,049 269 6,285 1,991 387 244 Mar-17 Jun-16 2,108 477 291 3.2x 16.2x 3.0x 13.2x

Charles River Laboratories International, Inc. 92.05 5.8% 7.1% 93.08 67.20 4,385 1,197 136 5,536 1,772 405 270 Apr-17 Dec-16 1,882 466 376 3.1x 13.7x 2.9x 11.9x

ICON Plc 94.10 12.3% 33.6% 94.17 63.94 5,060 349 319 5,240 1,698 388 330 Mar-17 Dec-16 1,762 412 350 3.1x 13.5x 3.0x 12.7x

INC Research Holdings, Inc. 56.85 30.2% 30.7% 59.45 36.70 3,076 488 165 3,457 1,579 230 170 Mar-17 Dec-16 1,103 270 243 2.2x 15.0x 3.1x 12.8x

PAREXEL International Corporation 80.82 24.9% 28.5% 81.79 51.16 4,103 700 284 4,554 2,428 345 241 Mar-17 Jun-16 2,194 393 284 1.9x 13.2x 2.1x 11.6x

PRA Health Sciences, Inc. 72.25 22.4% 53.0% 73.18 39.25 4,514 821 125 5,424 1,869 278 210 Mar-17 Dec-16 1,921 361 334 2.9x 19.5x 2.8x 15.0x

Quintiles IMS Holdings, Inc. 86.44 11.7% 27.3% 86.51 61.21 18,964 8,345 905 27,974 7,724 1,327 838 Mar-17 Dec-16 8,218 2,093 1,420 3.6x 21.1x 3.4x 13.4x



Disease Management

Alere Inc. $48.51 26.7% 12.9% $49.53 $31.47 $4,221 $2,951 $619 $7,154 $2,376 $334 $49 Dec-16 Dec-16 $2,444 $510 $389 3.0x 21.4x 2.9x 14.0x

Tiv ity Health, Inc. 33.95 17.5% 182.9% 34.75 11.15 1,330 207 83 1,501 516 109 106 Mar-17 Dec-16 575 126 122 2.9x 13.7x 2.6x 11.9x



Healthcare Staffing

AMN Healthcare Serv ices, Inc. $36.25 (11.9%) (2.9%) $44.99 $26.00 $1,736 $362 $55 $2,102 $1,929 $227 $196 Mar-17 Dec-16 $2,064 $265 $222 1.1x 9.3x 1.0x 7.9x

Envision Healthcare Holdings, Inc. 54.61 (22.0%) (27.0%) 82.37 53.12 6,414 5,833 312 12,886 4,850 882 690 Mar-17 Dec-16 8,245 1,100 900 2.7x 14.6x 1.6x 11.7x

Cross Country Healthcare, Inc. 11.55 (25.3%) (15.2%) 16.38 10.54 421 36 13 445 845 39 30 Mar-17 Dec-16 906 52 39 0.5x 11.4x 0.5x 8.5x

On Assignment, Inc. 52.40 11.0% 39.1% 53.80 32.05 2,768 617 24 3,383 2,485 260 199 Mar-17 Dec-16 2,710 322 244 1.4x 13.0x 1.2x 10.5x

Number of Companies 4 Median: (16.9%) (9.1%) Total $11,339 $18,816 $10,109 $13,926 1.2x 12.2x 1.1x 9.5x

Market Cap. Weighted Average: (12.5%) (6.7%) 2.0x 13.3x 10.7x

TEV/ Fwd MultiplesForward Twelve Month

EstimateCompany NameLTM

Period

Latest

FYE Date

TEV/ LTM MultiplesEquity

Mkt.

Value

Total DebtCash and

Equiv.

Total Ent.

Value

(TEV)

Latest Twelve Months

(LTM)

PUBLIC COMPARABLES

6

Payor, Provider, & Pharmacy Support Services(1)



* To be acquired by MARS, Inc. in a $9.1 billion take-private transaction announced January 9, 2017.

PAGE |

PUBLIC COMPARABLES

7




Stock Price

% Change 52 Week


HMO - Medical

Commercial:

Aetna Inc. $144.86 12.5% 27.9% $147.48 $104.59 $48,050 $9,423 $17,996 $55,426 $62,629 $3,421 $3,800 Mar-17 Dec-16 $62,125 $5,587 $4,769 0.9x 16.2x 0.9x 9.9x

Anthem, Inc. 182.35 10.6% 38.0% 185.00 114.85 48,320 17,143 4,075 59,678 87,232 6,585 5,625 Mar-17 Dec-16 90,697 5,953 5,210 0.7x 9.1x 0.7x 10.0x

Cigna Corporation 161.23 8.3% 25.9% 164.88 115.03 41,277 4,763 1,968 42,550 40,173 3,898 3,790 Mar-17 Dec-16 42,223 4,673 3,935 1.1x 10.9x 1.0x 9.1x

Humana Inc. 232.26 9.9% 34.6% 234.88 150.00 33,519 5,250 3,877 31,402 54,341 3,400 2,109 Mar-17 Dec-16 54,931 3,683 3,328 0.6x 9.2x 0.6x 8.5x

UnitedHealth Group Incorporated 175.18 5.9% 31.1% 178.89 132.39 168,814 33,901 10,430 192,319 189,046 15,819 13,407 Mar-17 Dec-16 207,078 17,812 15,711 1.0x 12.2x 0.9x 10.8x



Government:

Centene Corporation $72.63 3.0% 16.5% $77.60 $50.00 $12,513 $4,647 $4,068 $12,591 $45,378 $1,949 $1,571 Mar-17 Dec-16 $48,756 $1,993 $1,588 0.3x 6.5x 0.3x 6.3x

Molina Healthcare, Inc. 64.57 33.1% 33.3% 68.67 42.56 3,681 1,654 2,819 2,072 18,343 561 299 Mar-17 Dec-16 20,053 563 381 0.1x 3.7x 0.1x 3.7x

WellCare Health Plans, Inc. 171.80 21.7% 69.4% 174.51 100.18 7,644 2,080 4,054 4,167 14,651 694 622 Mar-17 Dec-16 17,684 747 649 0.3x 6.0x 0.2x 5.6x



Information Services

Data/Analytics:

Castlight Health, Inc. $3.50 (1.4%) (16.9%) $5.50 $3.05 $267 $0 $103 $264 $107 ($49) ($52) Mar-17 Dec-16 $148 ($24) ($25) 2.5x NM 1.8x NM

Inovalon Holdings, Inc. 13.60 13.3% (26.8%) 20.05 8.60 860 259 533 1,700 433 85 44 Mar-17 Dec-16 462 113 74 3.9x 19.9x 3.7x 15.1x

National Research Corporation 31.99 14.5% 24.0% 49.29 32.14 664 3 35 993 112 38 33 Mar-17 Dec-16 118 NA NA 8.9x 26.5x 8.4x NA

Number of Companies 3 Median: 13.3% (16.9%) Total $1,790 $993 $652 $729 3.9x 23.2x 3.7x 15.1x

Market Cap. Weighted Average: 11.6% (6.5%) 5.5x 22.8x 5.1x 15.1x

eHealth:

WebMD Health Corp. $55.98 7.9% (14.9%) $66.20 $48.10 $2,112 $1,046 $1,034 $2,801 $701 $194 $163 Mar-17 Dec-16 $729 $240 $172 4.0x 14.5x 3.8x 11.7x

Number of Companies 1 Median: 7.9% (14.9%) Total $2,112 $2,801 $701 $729 4.0x 14.5x 3.8x 11.7x


Hospital/Physician:

Allscripts Healthcare Solutions, Inc. $11.41 (6.3%) (15.4%) $15.17 $9.80 $2,071 $1,328 $104 $3,726 $1,618 $246 $58 Mar-17 Dec-16 $1,761 $362 $259 2.3x 15.1x 2.1x 10.3x

Athenahealth, Inc. 133.98 13.6% 5.6% 142.40 90.11 5,337 284 98 5,491 1,112 181 34 Mar-17 Dec-16 1,295 291 147 4.9x 30.3x 4.2x 18.9x

Cerner Corporation 65.35 18.7% 17.5% 67.50 47.01 21,587 550 532 21,988 4,919 1,496 976 Apr-17 Dec-16 5,382 1,775 1,277 4.5x 14.7x 4.1x 12.4x

Computer Programs and Systems, Inc. 33.40 24.2% (19.2%) 42.12 18.25 452 146 2 591 262 31 17 Mar-17 Dec-16 278 50 26 2.3x 19.2x 2.1x 11.8x

HMS Holdings Corp. 18.22 (2.2%) 10.3% 24.00 15.94 1,528 198 168 1,589 490 104 52 Mar-17 Dec-16 594 144 75 3.2x 15.3x 2.7x 11.0x

Premier Inc. 34.52 9.8% 8.6% 35.06 28.27 1,787 384 236 4,701 1,353 383 282 Mar-17 Jun-16 1,630 552 399 3.5x 12.3x 2.9x 8.5x

Quality Systems, Inc. 15.36 0.7% 20.8% 15.90 10.61 963 16 43 926 510 79 38 Mar-17 Mar-17 526 78 36 1.8x 11.8x 1.8x 11.8x

Advisory Board Company 51.70 14.9% 57.5% 54.50 24.85 2,098 602 150 2,574 797 140 60 Mar-17 Dec-16 825 207 80 3.2x 18.3x 3.1x 12.4x



Total Ent.

Value

(TEV)


(LTM)LTM

Period

Latest

FYE DateCompany Name

Equity

Mkt.

Value

Total DebtCash and

Equiv.

Forward Twelve Month

EstimateTEV/ LTM Multiples TEV/ Fwd Multiples

PAGE |

PUBLIC COMPARABLES

8




Stock Price

% Change 52 Week


Specialty Managed Care

Assurant, Inc. $97.98 (1.0%) 12.1% $106.02 $78.50 $5,368 $1,067 $0 $5,754 $6,558 $782 $0 Mar-17 Dec-16 $6,434 NA $679 0.9x 7.4x 0.9x NA

CorVel Corporation 46.60 15.3% (3.2%) 53.19 31.00 891 0 29 883 519 69 48 Mar-17 Mar-17 NA NA NA 1.7x 12.9x NA NA

HealthEquity Inc 45.80 4.8% 77.5% 49.25 25.52 2,744 0 196 2,617 190 58 44 Apr-17 Jan-17 239 88 60 13.8x NM 10.9x 29.9x



Retail Pharmacy

CVS Health Corporation $76.83 (4.7%) (20.3%) $98.67 $69.30 $78,274 $27,433 $2,302 $104,655 $178,825 $12,913 $10,436 Mar-17 Dec-16 $188,444 $12,930 $10,270 0.6x 8.1x 0.6x 8.1x

Walgreens Boots Alliance Inc 81.02 (6.2%) 4.7% 88.00 76.26 87,579 18,911 11,822 95,390 116,081 7,254 5,528 Feb-17 Aug-16 126,499 9,637 8,205 0.8x 13.2x 0.8x 9.9x

Rite Aid Corporation(*) 3.41 (43.2%) (55.7%) 8.77 3.32 3,593 7,329 252 10,694 32,845 1,100 532 Mar-17 Mar-17 33,092 1,068 413 0.3x 9.7x 0.3x 10.0x


Market Cap. Weighted Average: (16.5%) (28.6%) 0.9x 10.7x 0.8x 9.4x

Specialty Pharmacy

Diplomat Pharmacy, Inc. $17.14 26.5% (47.4%) $38.94 $12.25 $1,152 $137 $17 $1,283 $4,493 $91 $36 Mar-17 Dec-16 $4,818 $106 $83 0.3x 14.0x 0.3x 12.1x

Number of Companies 1 Median: 26.5% (47.4%) Total $1,152 $1,283 $4,493 $4,818 0.3x 14.0x 0.3x 12.1x

Market Cap. Weighted Average: 26.5% NM 0.3x 14.0x 0.3x 12.1x

Specialty Pharmacy Management

Express Scripts Holding Company $59.75 (15.4%) (20.9%) $80.02 $57.80 $35,463 $15,528 $3,164 $48,525 $100,317 $7,276 $5,202 Mar-17 Dec-16 $102,796 $7,447 $7,139 0.5x 6.7x 0.5x 6.5x

PharMerica Corporation 24.70 0.4% (7.0%) 28.72 19.20 768 467 15 1,222 2,133 130 70 Mar-17 Dec-16 2,449 145 118 0.6x 9.4x 0.5x 8.4x



Total Ent.

Value

(TEV)


(LTM)LTM

Period

Latest

FYE Date


EstimateCompany Name

Equity

Mkt.

Value

Total DebtCash and

Equiv.

TEV/ LTM Multiples TEV/ Fwd Multiples

* To be acquired by Walgreens (NYSE:WBA) in a $17.2 billion transaction announced October 27, 2015.

PAGE |

PUBLIC COMPARABLES

9

Products & Devices(1)



Stock Price

% Change 52 Week


Dental Products

3M Company $204.47 9.7% 21.5% $204.47 $163.85 $122,191 $11,711 $2,314 $134,584 $30,385 $8,593 $7,037 Mar-17 Dec-16 $31,307 $9,195 $7,715 4.4x 15.7x 4.3x 14.6x

DENTSPLY SIRONA, Inc. 63.52 0.0% 2.2% 65.83 55.00 14,561 1,551 363 16,063 3,873 789 486 Mar-17 Dec-16 4,090 1,007 889 4.1x 20.4x 3.9x 15.9x



Durable Medical Equipment

Hill-Rom Holdings, Inc. $77.36 16.4% 57.5% $77.75 $47.76 $5,088 $2,402 $219 $7,385 $2,678 $579 $371 Mar-17 Sep-16 $2,852 $628 $489 2.8x 12.7x 2.6x 11.8x

Invacare Corporation 14.15 16.9% 32.2% 16.65 8.00 454 149 79 533 1,018 (11) (25) Mar-17 Dec-16 991 5 (13) 0.5x NM 0.5x NM

ResMed Inc. 71.10 (1.3%) 20.4% 73.46 56.59 10,083 1,168 827 10,489 2,029 568 457 Mar-17 Jun-16 2,223 705 529 5.2x 18.5x 4.7x 14.9x



Life Sciences Tools

Agilent Technologies, Inc. $60.34 17.6% 31.5% $60.81 $41.98 $19,448 $2,043 $2,389 $19,268 $4,324 $991 $766 Apr-17 Oct-16 $4,544 $1,110 $994 4.5x 19.4x 4.2x 17.4x

Becton, Dickinson and Company 189.23 3.4% 13.7% 190.71 161.29 43,022 10,306 556 50,977 12,320 3,265 2,197 Mar-17 Sep-16 12,604 3,796 3,056 4.1x 15.6x 4.0x 13.4x

Thermo Fisher Scientific Inc. 172.79 9.6% 13.8% 174.38 139.07 67,599 17,071 734 84,434 18,744 4,759 2,953 Apr-17 Dec-16 20,159 5,235 4,812 4.5x 17.7x 4.2x 16.1x

VWR Corp. 33.06 17.7% 14.6% 37.25 24.42 4,352 2,181 142 6,428 4,555 447 314 Mar-17 Dec-16 4,683 513 462 1.4x 14.4x 1.4x 12.5x



Medical Devices and Products

Abbott Laboratories $45.66 1.3% 15.2% $45.84 $36.76 $79,233 $23,974 $8,860 $94,528 $22,303 $4,399 $2,619 Mar-17 Dec-16 $26,915 $7,632 $6,106 4.2x 21.5x 3.5x 12.4x

Baxter International Inc. 59.31 16.5% 37.4% 59.78 42.22 32,143 2,787 2,858 32,598 10,263 2,107 1,341 Mar-17 Dec-16 10,539 2,445 1,721 3.2x 15.5x 3.1x 13.3x

Boston Scientific Corporation 27.03 10.1% 19.0% 27.52 19.67 37,015 5,514 283 42,808 8,582 2,090 1,270 Mar-17 Dec-16 9,119 2,608 1,767 5.0x 20.5x 4.7x 16.4x

ConforMIS Inc 4.05 (19.5%) (46.1%) 10.93 3.89 177 15 64 124 80 (55) (58) Mar-17 Dec-16 88 (54) (60) 1.5x NM 1.4x NM

C. R. Bard, Inc. 307.43 25.4% 40.4% 311.05 203.63 22,263 1,752 1,070 23,648 3,779 1,187 975 Mar-17 Dec-16 4,008 1,343 1,213 6.3x 19.9x 5.9x 17.6x

Danaher Corporation 84.94 (0.7%) 13.9% 102.79 75.71 58,959 11,950 804 71,094 18,707 4,227 3,103 Mar-17 Dec-16 18,277 4,346 3,129 3.8x 16.8x 3.9x 16.4x

Hologic, Inc. 43.31 6.7% 25.9% 46.05 32.64 12,127 3,308 1,140 14,556 2,894 1,006 560 Apr-17 Sep-16 3,267 1,096 1,007 5.0x 14.5x 4.5x 13.3x

Johnson & Johnson 128.25 4.9% 13.8% 129.00 109.32 345,484 32,370 39,343 346,292 72,236 25,283 21,508 Apr-17 Jan-17 77,135 27,855 24,410 4.8x 13.7x 4.5x 12.4x

K2M Group Holdings, Inc. 22.75 13.5% 82.0% 23.92 12.45 969 73 39 995 242 (4) (34) Mar-17 Dec-16 283 14 (21) 4.1x NM 3.5x NM

Medtronic plc 84.28 4.2% 4.7% 89.27 69.35 115,370 33,441 13,708 137,122 29,710 9,230 6,313 Apr-17 Apr-17 31,058 9,993 9,002 4.6x 14.9x 4.4x 13.7x

Penumbra, Inc. 82.85 7.9% 56.9% 90.00 52.61 2,786 0 233 2,386 279 (3) (5) Mar-17 Dec-16 344 3 1 8.6x NM 6.9x NM

Stryker Corporation 142.96 11.2% 28.6% 143.20 106.48 53,433 7,219 3,279 58,165 11,785 3,172 2,578 Mar-17 Dec-16 12,533 3,588 3,268 4.9x 18.3x 4.6x 16.2x

Teleflex Incorporated 200.02 4.6% 24.2% 211.22 136.53 8,997 2,089 689 10,724 1,931 522 399 Apr-17 Dec-16 2,137 658 571 5.6x 20.6x 5.0x 16.3x



Medical / Surgical / Dental Supplies & Distribution

AmerisourceBergen Corporation $91.77 0.3% 22.4% $94.50 $68.38 $20,039 $4,455 $2,404 $22,352 $149,759 $2,341 $1,930 Mar-17 Sep-16 $164,257 $2,427 $2,124 0.1x 9.5x 0.1x 9.2x

Cardinal Health, Inc. 74.29 (8.7%) (5.9%) 85.52 62.70 23,467 5,461 1,368 27,853 128,394 3,134 2,433 Mar-17 Jun-16 137,609 3,364 2,912 0.2x 8.9x 0.2x 8.3x

Henry Schein, Inc. 183.97 7.2% 5.9% 184.08 146.23 14,594 1,399 63 16,759 11,782 1,005 831 Apr-17 Dec-16 12,504 1,086 895 1.4x 16.7x 1.3x 15.4x

McKesson Corporation 163.09 8.6% (10.9%) 199.43 114.53 34,396 8,545 2,983 43,436 198,533 371 (539) Mar-17 Mar-17 205,825 4,440 3,729 0.2x NM 0.2x 9.8x

Owens & Minor, Inc. 31.88 (11.6%) (14.5%) 38.47 30.43 1,951 564 127 2,350 9,596 255 202 Mar-17 Dec-16 9,829 264 211 0.2x 9.2x 0.2x 8.9x

Patterson Companies, Inc. 44.16 (2.8%) (9.5%) 50.40 36.46 4,289 1,072 95 5,197 5,593 372 288 Apr-17 Apr-17 5,752 433 373 0.9x 14.0x 0.9x 12.0x



Total Ent.

Value

(TEV)


(LTM)LTM

Period

Latest

FYE Date


EstimateCash and

Equiv.Company Name

Equity

Mkt.

Value

Total DebtTEV/ LTM Multiples TEV/ Fwd Multiples

PAGE |

PUBLIC COMPARABLES

10

Provider-Based Services(1)



Stock Price

% Change 52 Week


Acute-Care Hospitals

Community Health Systems, Inc. $8.85 (9.2%) (34.2%) $15.52 $4.15 $1,015 $15,245 $247 $16,647 $17,925 $2,027 $989 Mar-17 Dec-16 $15,613 $2,009 $1,073 0.9x 8.2x 1.1x 8.3x

HCA Healthcare Inc 81.91 (6.1%) 5.0% 91.03 67.00 30,053 31,514 803 63,495 41,853 8,160 6,152 Mar-17 Dec-16 44,281 8,677 6,544 1.5x 7.8x 1.4x 7.3x

LifePoint Health, Inc. 60.80 (5.1%) (8.3%) 71.00 50.60 2,454 2,910 126 5,454 6,414 738 383 Mar-17 Dec-16 6,650 815 455 0.9x 7.4x 0.8x 6.7x

Tenet Healthcare Corporation 16.54 (14.3%) (42.8%) 31.84 14.06 1,663 15,218 572 19,394 19,390 2,142 1,283 Mar-17 Dec-16 20,016 2,592 1,697 1.0x 9.1x 1.0x 7.5x


Market Cap. Weighted Average: (6.5%) 0.7% 1.4x 7.8x 1.4x 7.3x

Assisted Living

Brookdale Senior Liv ing Inc. $13.74 (4.6%) (23.4%) $18.62 $10.65 $2,558 $5,167 $89 $7,629 $4,931 $779 $263 Mar-17 Dec-16 $4,594 $704 $193 1.5x 9.8x 1.7x 10.8x

Capital Senior Liv ing Corporation 13.84 (17.6%) (24.3%) 19.92 12.65 419 1,014 26 1,393 454 78 14 Mar-17 Dec-16 488 102 22 3.1x 17.8x 2.9x 13.7x



Long-Term Care

Kindred Healthcare, Inc. $9.80 8.9% (17.4%) $12.84 $5.65 $840 $3,369 $228 $4,213 $7,150 $515 $361 Mar-17 Dec-16 $6,772 $533 $399 0.6x 8.2x 0.6x 7.9x

National HealthCare Corporation 68.50 (8.2%) 10.6% 78.99 60.81 1,041 149 209 983 936 103 63 Mar-17 Dec-16 NA NA NA 1.1x 9.6x NA NA

Ensign Group, Inc. 18.38 (2.4%) (7.4%) 23.18 16.51 932 267 41 1,197 1,713 120 79 Mar-17 Dec-16 1,817 298 135 0.7x 10.0x 0.7x 4.0x



Diagnostic Imaging

Alliance HealthCare Serv ices, Inc. $13.25 28.0% 82.8% $13.30 $5.73 $143 $543 $21 $797 $512 $127 $60 Mar-17 Dec-16 NA NA NA 1.6x 6.3x NA NA

RadNet, Inc. 7.20 21.0% 38.2% 7.98 4.98 340 636 8 966 897 113 46 Mar-17 Dec-16 921 144 59 1.1x 8.6x 1.0x 6.7x

Varian Medical Systems, Inc. 99.02 18.0% 35.1% 106.70 76.94 9,102 547 706 9,123 3,121 558 481 Mar-17 Sep-16 2,804 581 496 2.9x 16.4x 3.3x 15.7x



Dialysis Services

American Renal Associates Holdings, Inc. $16.20 (28.3%) (42.1%) $29.65 $15.47 $505 $566 $84 $1,295 $755 $150 $115 Mar-17 Dec-16 $797 $107 NA 1.7x 8.6x 1.6x 12.1x

DaVita Inc. 66.26 (4.5%) (14.3%) 78.77 54.50 12,894 9,089 1,785 21,423 14,861 2,465 1,724 Mar-17 Dec-16 15,479 2,495 1,745 1.4x 8.7x 1.4x 8.6x

Fresenius Medical Care AG & Co. KGaA 95.76 8.4% 9.2% 95.92 75.71 29,457 8,695 705 38,071 18,410 3,503 2,712 Mar-17 Dec-16 21,107 4,016 3,128 2.1x 10.9x 1.8x 9.5x



Home Care, Hospice, and Home Infusion

Home Care / Hospice:

Addus HomeCare Corporation $37.10 15.2% 85.5% $40.75 $16.55 $430 $24 $19 $435 $410 $34 $27 Mar-17 Dec-16 $439 $38 $31 1.1x 13.0x 1.0x 11.4x

Almost Family, Inc. 57.40 15.6% 37.3% 59.53 35.21 796 130 14 893 671 56 51 Mar-17 Dec-16 850 76 69 1.3x 16.0x 1.1x 11.8x

Amedisys, Inc. 59.92 24.3% 17.8% 61.39 34.58 2,021 92 48 2,087 1,459 95 76 Mar-17 Dec-16 1,566 150 127 1.4x 21.9x 1.3x 13.9x

Chemed Corporation 204.66 14.6% 56.9% 216.01 126.54 3,291 147 47 3,538 1,592 224 189 Mar-17 Dec-16 1,680 260 210 2.2x 15.8x 2.1x 13.6x

LHC Group, Inc. 60.20 25.4% 43.3% 66.30 32.04 1,100 79 17 1,164 939 86 74 Mar-17 Dec-16 1,057 90 86 1.2x 13.5x 1.1x 13.0x



Home Infusion:

BioScrip, Inc. $1.81 19.9% (33.0%) $3.43 $0.98 $219 $472 $21 $741 $915 $28 $4 Mar-17 Dec-16 $836 $54 $23 0.8x 26.9x 0.9x 13.6x

Number of Companies 1 Median: 19.9% (33.0%) Total $219 $741 $915 $836 0.8x 26.9x 0.9x 13.6x


Total Ent.

Value

(TEV)


(LTM)LTM

Period

Latest

FYE Date


EstimateCompany Name

Equity

Mkt.

Value

Total DebtCash and

Equiv.

TEV/ Fwd MultiplesTEV/ LTM Multiples

PAGE |

Stock Price

% Change 52 Week


Physician Practice Management

Specialty:

MEDNAX, Inc. $54.30 (23.7%) (20.7%) $76.96 $53.80 $5,051 $1,902 $53 $6,907 $3,266 $653 $558 Mar-17 Dec-16 $3,597 $645 $536 2.1x 10.6x 1.9x 10.7x



Behavioral Health / Management

AAC Holdings, Inc. $6.28 (31.5%) (70.8%) $24.38 $6.01 $151 $198 $6 $327 $287 $21 $2 Mar-17 Dec-16 $309 $56 $21 1.1x 15.5x 1.1x 5.9x

Acadia Healthcare Company, Inc. 41.34 (7.6%) (29.8%) 63.67 32.54 3,631 3,281 43 6,849 2,873 585 444 Mar-17 Dec-16 2,968 654 480 2.4x 11.7x 2.3x 10.5x

Civ itas Solutions, Inc. 15.75 (14.9%) (27.6%) 23.20 15.40 588 635 18 1,206 1,438 137 63 Mar-17 Sep-16 1,547 171 85 0.8x 8.8x 0.8x 7.0x

Magellan Health, Inc. 68.75 (0.6%) 3.8% 84.71 49.50 1,631 636 614 1,679 5,025 272 164 Mar-17 Dec-16 6,092 345 187 0.3x 6.2x 0.3x 4.9x

Universal Health Serv ices, Inc. 113.66 (9.5%) (15.7%) 139.46 99.72 10,165 3,899 63 14,977 9,929 1,697 1,274 Mar-17 Dec-16 11,726 1,840 1,411 1.5x 8.8x 1.3x 8.1x



Surgicenters / Rehabilitation

Surgery Centers(*):

Surgery Partners, Inc. $21.80 (3.1%) 58.5% $22.85 $13.60 $1,063 $1,480 $67 $2,460 $1,165 $246 $205 Mar-17 Dec-16 $1,340 $217 NA 2.1x 10.0x 1.8x 11.3x

Number of Companies 1 Median: (3.1%) 58.5% Total $1,063 $2,460 $1,165 $1,340 2.1x 10.0x 1.8x 11.3x

Market Cap. Weighted Average: (3.1%) 58.5% 2.1x 10.0x 1.8x 11.3x

Rehabilitation:

HealthSouth Corporation $45.33 7.1% 12.4% $47.89 $36.97 $4,060 $2,953 $144 $7,650 $3,711 $826 $651 Mar-17 Dec-16 $4,037 $833 $654 2.1x 9.3x 1.9x 9.2x

Select Medical Holdings Corporation 13.40 (6.9%) 5.8% 15.15 10.08 1,778 2,816 65 5,027 4,309 458 305 Mar-17 Dec-16 4,536 561 394 1.2x 11.0x 1.1x 9.0x

U.S. Physical Therapy, Inc. 63.25 (16.4%) 9.5% 78.00 51.96 792 52 20 893 357 58 50 Dec-16 Dec-16 400 60 57 2.5x 15.3x 2.2x 14.8x

Number of Companies 3 Median: (6.9%) 9.5% Total $6,630 $13,570 $8,377 $8,973 2.1x 11.0x 1.9x 9.2x


Company Name

Equity

Mkt.

Value

Total DebtCash and

Equiv.

Total Ent.

Value

(TEV)


(LTM)LTM

Period

Latest

FYE Date


EstimateTEV/ LTM Multiples TEV/ Fwd Multiples

PUBLIC COMPARABLES

11



Provider-Based Services(1)

* Figures are adjusted for minority interest.

PAGE |

Enterprise Enterprise Value / LTM Private Equity

Announced Target Seller Buyer Value ($mm) Sales EBITDA EBIT Involvement

5/1/2017 Tenet Healthcare Corp. /3 Hospitals/ Tenet Healthcare Corp. HCA Holdings, Inc. - - - - No

5/1/2017 Cipher Pharmaceuticals US LLC Cipher Pharmaceuticals Ltd. EPI Health LLC $14.4 - - 14.4x No

5/1/2017 Span-America Medical Systems, Inc. - Savaria Corp. $72.9 - - - No

5/1/2017 Tomball Regional Medical Center Community Health Systems, Inc. HCA Holdings, Inc. - - - - No

5/1/2017 South Texas Regional Medical Center Community Health Systems, Inc. Methodist Healthcare System of San

Antonio Ltd. LLP; Methodist Healthcare

Ministries of South Texas, Inc.; HCA

Holdings, Inc.

- - - - No

5/1/2017 Mississippi Baptist Health Systems, Inc. - Baptist Memorial Health Care Corp. - - - - No

5/1/2017 Tecomet, Inc. - Charlesbank Capital Partners LLC - - - - Yes

5/1/2017 Synergy Emergency Physicians, Inc. - Team Health Holdings, Inc. - - - - No

5/1/2017 Lake Area Medical Center Community Health Systems, Inc. CHRISTUS Health, Inc. - - - - No

5/2/2017 United Ambulance LLC - A Clean Slate, Inc. - - - - No

5/2/2017 Threewire, Inc. - WIRB-Copernicus Group, Inc. - - - - No

5/2/2017 Byram Healthcare Centers, Inc. Mediq BV Owens & Minor, Inc. $380.0 - - - No

5/2/2017 Caisson Interventional LLC - LivaNova Plc $141.2 - - - No

5/2/2017 Orchard Assisted Liv ing & Memory Care - Sagora Senior Liv ing, Inc. - - - - No

5/3/2017 American Eagle Instruments, Inc. - Young Innovations, Inc.; Linden

Manager LLC

- - - - No

5/3/2017 Zirmed, Inc. /Analytics Div/ ZirMed, Inc. Koan Health LLC - - - - No

5/4/2017 Alfama, Inc. - Proterris, Inc. - - - - No

5/4/2017 Options Serv ices, Inc. HB Management Group, Inc. Addus HomeCare Corp. - - - - No

5/4/2017 LexisNexis Legal & Professional, Inc. /Occu Health

Div/

RELX Plc NOSA Global Holdings Ltd. $0.2 - - 0.2x No

5/4/2017 Bostwick Laboratories, Inc. - Poplar Healthcare PLLC - - - - No

5/4/2017 Village Dermatology & Cosmetic Surgery LLC - Clear Clinic & Schweiger Dermatology

Management Co. LLC

- - - - No

5/4/2017 Wound & Skin Experts LLC - KG Health Partners, Inc. - - - - No

5/4/2017 St. Francis Health Center, Inc. Sisters of Charity of Leavenworth

Health System

Ardent Health Serv ices LLC; The

University of Kansas Hospital Authority;

St. Francis Health Center, Inc. /Private

Group/

- - - - No

5/4/2017 PolicyStat LLC - iContracts, Inc. - - - - No

5/5/2017 VWR Corp. - New Mountain Capital LLC; Avantor

Performance Materials, Inc.

$6,421.8 14.4x 20.5x - Yes

5/5/2017 Triad Isotopes, Inc. /Radiopharmacy Bus/ Triad Isotopes, Inc. Jubilant Pharma Ltd. - - - - No

5/5/2017 Neubauer Hyperbaric Neurologic Center, Inc. - Alternate Health Corp. - - - - No

5/8/2017 River Vision Development Corp. - Horizon Pharma Plc $145.0 - - - No

5/8/2017 Medical Solutions LLC - TPG Growth LLC; TPG Capital Advisors

LLC

- - - - Yes

5/8/2017 Purity Dialysis Centers, Inc. - DaVita Kidney Care - - - - No

5/8/2017 WRB Communications, Inc. - Diplomat Pharmacy, Inc. $30.0 13.6x - 30.0x No

5/9/2017 ProPhase LLC - WIRB-Copernicus Group, Inc. - - - - No

5/9/2017 Medicametrix, Inc. - Cardiff International, Inc. $6.0 - - 6.0x No

5/9/2017 Origins Behavioral Healthcare LLC - TRT Holdings, Inc. - - - - No

5/9/2017 Nuelle, Inc. - Aytu BioScience, Inc. $25.7 - - 25.7x No

5/9/2017 Pristine, Inc. - GE Ventures LLC; Upskill, Inc.; Boeing

HorizonX

- - - - Yes

5/9/2017 Dermatology Consultants of Broward - GTCR LLC; Riverchase Dermatology &

Cosmetic Surgery LLC

- - - - Yes

5/9/2017 Stay At Home Personal Care Commonwealth Assisted Liv ing LLC BelHealth Investment Partners LLC;

Care Advantage, Inc.

- - - - Yes

5/9/2017 American Kidney Stone Management Ltd. - United Medical Systems (DE), Inc.; New

State Capital Partners LLC

- - - - No

5/10/2017 National Surgical Hospitals, Inc. - Surgery Partners, Inc. $760.0 - - - No

5/10/2017 InVentiv Group Holdings, Inc. - INC Research Holdings, Inc. $6,647.6 26.2x - - No

5/10/2017 Surgery Partners, Inc. - Bain Capital Private Equity LP $2,340.7 9.5x 11.4x - Yes

5/11/2017 Voto Health Care, Inc. - Cornerstone Healthcare, Inc. - - - - No

5/11/2017 General Healthcare Resources, Inc. - GHR Acquisition LLC - - - - No

5/11/2017 ProEx Physical Therapy - Thomas H. Lee Partners LP; Professional

Orthopedic & Sports Physical Therapy

PC

- - - - Yes

5/15/2017 Cleveland Skin Pathology Laboratory, Inc. - Summit Partners LP; KRG Capital LLC;

Aurora Diagnostics Holdings LLC

- - - - Yes

5/15/2017 ASC Biosciences, Inc. - ASC Biosciences, Inc. /Old/ - - - - No

5/16/2017 Synlogic, Inc. - Mirna Therapeutics, Inc. - - - - No

5/16/2017 Rapid Pathogen Screening, Inc. / Inflammadry &

Adenoplus/

Rapid Pathogen Screening, Inc. Quidel Corp. $14.0 - - 14.0x No

5/17/2017 Matrix Healthcare Serv ices, Inc. (Florida) - Express Scripts Holding Co. - - - - No

5/17/2017 Sharklet Technologies, Inc. - Peaceful Union - - - - No

5/18/2017 IASIS Healthcare Corp. - Cerberus Capital Management LP;

Steward Health Care System LLC

$1,900.0 - - - Yes

M&A TRANSACTIONS

12

Announced U.S. Healthcare & Life Sciences M&A(1)



PAGE |

Enterprise Enterprise Value / LTM Private Equity

Announced Target Seller Buyer Value ($mm) Sales EBITDA EBIT Involvement

5/18/2017 Cranial Technologies, Inc. - Beecken Petty O'Keefe & Co. LP - - - - Yes

5/19/2017 CellRight Technologies LLC - Tissue Regenix Group Plc - - - - No

5/22/2017 Respiratory Technologies, Inc. - Royal Philips NV - - - - No

5/22/2017 Hospice Management LLC - Alpine Investors; Optima Healthcare

Solutions LLC

- - - - Yes

5/22/2017 Peace In Medicine - San Francisco Patient & Resource

Center

- - - - No

5/22/2017 EyeCare Serv ices Partners Holdings LLC - Harvest Partners LP - - - - Yes

5/23/2017 True North Therapeutics, Inc. - Bioverativ , Inc. $825.0 - - - No

5/23/2017 BarioSurg, Inc. - EnteroMedics, Inc. $8.3 - - 8.3x No

5/24/2017 iMd Cos., Inc. /iMd Meds & Hemp Energy Protein

Bar Div ision/

iMD Cos., Inc. International Sustainability Group, Inc. $29.4 - - 29.4x No

5/25/2017 PartsSource, Inc. - Great Hill Partners LP - - - - Yes

5/30/2017 HemoSonics LLC - Diagnostica Stago SAS - - - - No

5/30/2017 Controlled Environment Genomics, Inc. - Gala Global, Inc. - - - - No

M&A TRANSACTIONS

13

Announced U.S. Healthcare & Life Sciences M&A(1)



Energy, Power & Infrastructure

IndustrialsHealthcare & Life Sciences

Transportation & Logistics

Aerospace, Defense & Government

Services

Business Services

Building Products & Materials

Technology, Media & Telecom

Specialty Distribution

Consumer

PAGE |

HARRIS WILLIAMS & CO. OFFICE LOCATIONS

UNITED STATES EUROPE

FrankfurtBockenheimer Landstrasse 33-3560325 Frankfurt, GermanyPhone: +49 069 3650638 00

London63 Brook StreetLondon W1K 4HS, EnglandPhone: +44 (0) 20 7518 8900

NETWORK OFFICES

Beijing

Hong Kong

Mumbai

New Delhi

Shanghai

Harris Williams & Co. has a broad range of industry expertise, which creates powerful opportunities.Our clients benefit from our deep-sector experience, integrated industry intelligence andcollaboration across the firm, and our commitment to learning what makes them unique. For moreinformation, visit our website.

Richmond (Headquarters)1001 Haxall Point9th FloorRichmond, Virginia 23219Phone: +1 (804) 648-0072

San Francisco575 Market Street31st FloorSan Francisco, California 94105Phone: +1 (415) 288-4260

Washington, D.C. 800 17th St. NW2nd FloorWashington, D.C. 20006Phone: +1 (202) 207-2300

BostonOne International PlaceSuite 2620Boston, Massachusetts 02110Phone: +1 (617) 482-7501

Cleveland1900 East 9th Street20th FloorCleveland, Ohio 44114Phone: +1 (216) 689-2400

Minneapolis222 South 9th StreetSuite 3350Minneapolis, Minnesota 55402Phone: +1 (612) 359-2700

Healthcare & Life Sciences

OUR FIRM



14

PAGE |

HARRIS WILLIAMS & CO.

15

SOURCES

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 a private limited company incorporated under English law with its registered office at 5th Floor, 6 St. Andrew Street, London EC4A 3AE, UK, registered with the Registrar of Companies for England and Wales (registration number 7078852). Harris Williams & Co. Ltd is authorized 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 THIRD-PARTY 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.

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.

Copyright© 2017 Harris Williams & Co., all rights reserved.

DISCLOSURES



1. FactSet.

2. Company Filings.

3. S&P.

4. PNC Debt Capital Markets.

5. Thomson Financial.

6. Bloomberg.

http://www.harriswilliams.com/

Date post:	09-Oct-2020
Category:	Documents
Upload:	others
View:	1 times
Download:	0 times

HEALTHCARE & LIFE SCIENCES...federal Medicaid spending by $383.2 billion from 2017 through 2026,...

Documents