1. Trends in Medical Device Clinical Outsourcing: Where are we now as an industry and what does the future hold? Partnerships in Medical Device Trials

2. 2 Survey Respondent Base Sponsor: What type of products does your company develop? Sponsor: In what FDA Class is/are the primary medical device(s) that your company develops? 53 25 7 Therapeutic Medical Devices Diagnostic Medical Devices Other 16 46 30 3 Class I Class II Class III N/A 37% 16% 30% 17% Large (>$1.5B) Mid-sized ($100M-$1.5B) Small, revenue-generating company ($1-$99M) Pre-revenue company Sponsor: How would you characterize your company based on its revenue? N=70 16% 31% 28% 19% 6% Top 5 CRO Mid-sized CRO Small/specialty CRO Independent contractor Other N=32 CRO: How would you describe your company?

3. 3 Why Outsource? Q: Sponsor: What is/are the key reason(s) that you outsource clinical research? 39 18 9 6 5 5 4 2 Management of resource capacity gaps Access to operational expertise/experience Access to regulatory expertise/experience Access to scientific expertise/experience Accelerated time to market Reduced cost overall Better cost predictability Better access to investigators

4. 4 Which Services? Q: Sponsor: When you outsource clinical services, which of the following services do you prefer to outsource? 34 33 26 24 15 14 13 8 6 4 4 Clinical Monitoring Data Management Biostatistical Analysis Clinical Trial Management Safety Medical Writing Regulatory Approvals/Activities Investigator Recruitment Quality Assurance Preclinical Development Protocol Design

5. 5 What Drives Vendor Selection? 91% 72% 70% 56% 53% 44% 33% 28% 28% 28% 28% 23% 23% 9% 91% 69% 53% 88% 38% 56% 38% 44% 47% 50% 19% 59% 41% 9% Medical device experience/expertise Cost-effectiveness Effective communication Therapeutic area experience/expertise Specific staff assigned to project Geographic reach Existing relationship with the company Regulatory expertise Hands-on attention from a single point of contact Accurate response to RFP Partnering/preferred provider benefits Personalized attention Operational excellence/innovation Size of the company Sponsor (N=43) CRO (N=32) Q: Sponsor: What are the most important attributes you look for in a clinical service provider? Q: CRO: What do you think are the most important attributes that medical device companies look for when looking for a provider of outsourced clinical research services?

6. 6 How are CROs Performing? Q: Have there been significant gaps in terms of services or expertise Sponsors: that you have been able to obtain from clinical service providers in the past 2 years? 57% said yes CROs: that CROs have been able to provide medical device companies in the past 2 years? 50% said yes

7. 7 How are CROs Performing? Mean Ratings Sponsor CRO Difference I am satisfied with the overall service received from the CROs my company is using on our medical device trials. my company provides to support clinical trials for medical device and diagnostic companies. 3.3 4.2 -0.9 CROs currently have the requisite regulatory knowledge to successfully design and execute medical device trials. 3.3 3.8 -0.5 CROs currently have the requisite clinical knowledge and capabilities to successfully execute medical device trials. 3.4 3.9 -0.5 There is a significant opportunity for select CROs to differentiate based on their ability to successfully conduct medical device trials. 4.2 4.4 -0.2 N range= 50-65 30-32

8. 8 Break-Out: How are CROs Performing? Mean Ratings Sponsor: Large/ Mid-sized Sponsor: Small/ Pre-revenue CRO I am satisfied with the overall service received from the CROs my company is using on our medical device trials. my company provides to support clinical trials for medical device and diagnostic companies. 3.1 3.9 4.2 CROs currently have the requisite regulatory knowledge to successfully design and execute medical device trials. 3.1 3.5 3.8 CROs currently have the requisite clinical knowledge and capabilities to successfully execute medical device trials. 3.2 3.6 3.9 There is a significant opportunity for select CROs to differentiate based on their ability to successfully conduct medical device trials. 4.2 4.4 4.4 N range= 31-35 17-31 30-32

9. 9 How are Sponsors Performing? Mean Ratings Sponsor CRO Difference Specifying the tasks to be performed and all relevant assumptions in RFPs sent to CROs 3.1 2.5 0.6 Specifying realistic project timelines in RFPs sent to CROs 3.0 2.4 0.5 Managing outsourcing relationships overall 3.1 2.6 0.5 Efficient use of internal resources in the management of outsourced studies 3.0 2.5 0.5 Establishing appropriate contracts with CROs 3.1 2.7 0.4 Managing CRO relationships 3.1 2.7 0.4 Managing CRO performance 3.0 2.6 0.3 Identifying the CROs to which RFPs should be sent 2.9 2.7 0.2 Managing CRO costs 2.8 2.8 0.0 N range= 41-43 26-32 Q: How strong do you feel that your company's capabilities / medical device companies are in each of the following areas?

10. Future Trends

11. 11 What percentage of your company's outsourced spend is currently directed toward each of the following type of outsourcing relationships? Average Values What percentage of your company's outsourced spend currently falls under each of the following types of outsourcing models? Average Values 53% 20% 13% 4% Project-by-project outsourcing Preferred providers Strategic alliances/ partnerships Other 67% 24% 4% Functional Service Providers Full Service Providers Other Current Trends in Outsourcing When you outsource clinical research services, what types of service providers do you prefer? 4 21 30 22 2 Top 5 CROs Mid-sized CROs Small/specialty CROs Independent contractor Other

12. 12 32% 13% 7% 13% 35% 1% - 25% 26% - 50% 51% - 75% 76% - 100% Didn't outsource 68% 11% 21% Yes, an increase Yes, a decrease No In 2013, approximately what percentage of your companys total spending on clinical research was outsourced to a clinical services provider? Do you anticipate a change in your amount of clinical outsourcing in the next three years? 3% 21% 21% 55% 1% - 3% 4% - 6% 7% - 10% More than 10% By what percentage do you anticipate an increase in your amount of clinical outsourcing in the next three years? N=34 Medical Device Companies Predict Future Trends N=60 N=56

13. Thank you Lisa.McKay@theavocagroup.com Contact Avoca at: (609) 252-9020 www.theavocagroup.com info@theavocagroup.com