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Imaging
Steve RusckowskiCEO Philips Healthcare
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CAGR 2008 – 2012: 2%– 4%
Imaging markets by region and modality2008
Market by Region2008, Total Market €14.900 M
Market by Modality2008
LATAMChina
MCR APAC
MCR EMEA
Japan
Western Europe
North America
Source: Philips analysis, industry reports, Imaging Market including Ultrasound
Ultrasound21%
Ultrasound21%
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15%
16%
17%
18%
19%
20%
21%
22%
2006 2007 200815%
16%
17%
18%
19%
20%
21%
22%
2006 2007 2008
Philips market share development2006 – 2008
market share for imaging equipment – CT, MR, Ultrasound, CV, General X-Ray and Nuclear MedicineSource: Philips analysis
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Leverage services as an increasing source of revenue
CAGR 4.4%
CAGR 7.8%
Philips Imaging Systems: Equipment and Services revenue
Imaging System revenue; excludes Ultrasound
ServicesEquipment
• Service revenue growth outpaces equipment growth
• Emerging market growth provides new service opportunities
• Operational improvements will yield margin gains and enhanced customer satisfaction
• New business programs will accelerate growth
Total CAGR 5.4%
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Imaging equipmentMarket conditions
• Demographics drive increased procedures
• Healthy growth in China, India and LATAM
• New hospital building continues to drive demand
• Slight short-term market decrease; some regions of growth
• Various stimulus packages in place
• Recovery of overall imaging market expected in 2010
• Short-term contraction –postponements of investments
• Demand building
• Solid long-term opportunity enhanced by ARRA and healthcare reform
North America International Emerging Markets
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Fundamentals for Imaging business remain strong Growth in procedure volume
DemandAging baby boomersRise in chronic diseasesStimulus/ARRAExpansion of Healthcare coverage
EconomyUnemploymentMEDPAC UtilizationDecline in elective procedures
Today’s US market conditions are challenging, but we expect long term growth driven by increasing procedure volume
Total outpatient imaging volume2007-2012
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New products to serve the value segment
• Specifically designed to the demands of community hospitals and diagnostic outpatient centers
• Ideally suited when price/performance is a key decision parameter
• Right solution for smaller hospitals and private practices
• Drives digitization of radiography rooms
• Novel combination of SPECT molecular imaging and flat panel CT
• Ideally suited for hybrid imaging in Cardiac, Oncology and Orthopedic applications
• Solution designed to dedicated needs of Emerging Markets
• Optimal price/ performance
BrightView XCT CT MX 16
Essenta DR Compact Essenta CV
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We are leveraging our LCC industrial footprint
• Boost Ultrasound, CT andMR production
• Expand GXR portfolio with Digital RAD systems
Leverage Philips-Neusoft
Leverage Meditronics / Alpha :
• Initial focus on GXR and CV products for local and regional markets
• Expand Surgery systems for global reach• Expand portfolio with locally produced Digital
RAD systems
• Initially focused on GXR systems for local and regional markets• Now producing CV, CT and MR systems for regional markets• Ultrasound production being planned• Digital Mammo for emerging markets under development
Leverage VMI:
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Opportunity for Philips to expand into therapy spaces
We have a comprehensive Imaging portfolio to support our care cycle solutions
Screening Diagnosis Therapy planning
Therapydelivery
Cardiology
Oncology
Women’s Health
RTP PinnacleBig Bore CT
MammotrakDigital
Mammography
CT Virtual Colonography
Cardiac CTMR
AngiographyIntegrated Cathlab
Integrated EP lab
PET / CT
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Significant portion of Philips revenue from Image Guided Interventions and Therapy (IGIT)
Revenue growth from equipment for IGIT procedures more than twice as fast as revenue growth for equipment for Diagnostic procedures
For Image Guided Intervention and Therapy proceduresFor Diagnostic procedures
2008 Philips Imaging equipment revenue
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Philips is recognized as a leader in Cardiology imaging
Opportunity for Philips to lead in image guided intervention and therapy
from ‘cardiac open-surgery’ to ‘minimally invasive intervention’
over-the-wire treatment with intelligent devices
procedures with multi-modality navigation
2006 2009 2010 201220051990
Coronary Artery Disease: Ballooning and stenting
Our Historic Stronghold
Cardiac arrhythmias: Catheter ablation
Our Current Focus
Structural heart disease:Minimally invasive valve repair
Our Future Ambition
Pro
cedu
res
Focus shifts from diagnosis to therapy planning and image guided intervention
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Big Bore PET/CT allows more accurate Radiation Therapy Planning using Pinnacle
In Oncology, Philips leads in advanced applications
GEMINI TF Big BorePET/CT
Pinnacle2
andSmartArc
Brilliance Big Bore
Oncology Configuration
T2N2 T2N1
Delineation CT only Delineation CT + PET
PET/CT and PROS has improved diagnosisand planning by >10% 1)
Ease of use allows clinicians to routinely image organs in motion (e.g., lung, liver)
Philips offerings in Oncology provide clear clinical benefits
1) References:1. Data: Improvements in Cancer Staging with PET/CT: Literature-Based Evidence as of September 2006, J. Czernin et al, J Nucl Med 2007, 48:78S-88S2. Steenbakkers et al, NKI-AVL Amsterdam, Medica Mundi vol 51/2+3, November 2007
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Philips continues to drive leadership in oncology by adding innovation
• New treatment paradigm for various benign and malignant tumors
• Non-invasive procedure, easy to perform, short recovery time
• Leading technology position creates a unique, cost-effective add-on for use with existing MR scanners
• Clinical trials started in the U.S.and France
Moving into targeted Therapy with MR guided High Intensity Focused Ultrasound (HIFU)
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In summary
Current imaging market is challenging but …
• Sales strong in selective markets
• Fundamental market drivers remain strong
• Image guided interventions will expand market
• Continued growing services business
• Philips well positioned for the future
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