COMPANY CONFIDENTIAL

US HEALTH IT TRANSFORMATION

US Healthcare Digital Transformation

David Feygin, Ph.D., MBA

VP of Health IT Integration and Strategic Innovation, BD

COMPANY CONFIDENTIALRapid change driven by converging policy, clinical, demographic and technology trends

• Coverage Expansion • Population Health

• Value-Based Payments • Personalized Treatments

• Provider Consolidation

• Aging Population • Patient Consumerism

• Provider Shortages • Healthcare IT & Informatics

• Care Setting Shift

RAPIDLY CHANGING  HEALTHCARE

ENVIRONMENT

Patient-centric, evidence-driven,

technology-enabled, cost-effective,

location-optimized, high-quality

HEALTHCARE

Provider-centric, experimental,paper-based,

wasteful, hospital-bound,

inconsistent SICKCARE

FROM: TO:PARADIGM SHIFT

COMPANY CONFIDENTIALReform and Data Are Creating New Opportunities to Improve Lives

Shifting profit pools and creating vast new economically viable opportunities

Hospitals Highly Connected(HIMSS Stage 4+)

>55%>55%50 ‐70%50 ‐70%Hospital Revenue from Value Based 

Reimbursement by 202O

Available, Connected DataValue Based Reimbursement

COMPANY CONFIDENTIALAs Incentives Align, Informatics Becomes Key to Addressing Major Needs

Viable OpportunitiesFrom To

Pay for service & provider incentives to maximize revenue

Focus on what’s broken or inefficient (adherence, errors,ineffective treatments, overuse)

Pay for performance and efficiency

Individual components and products

total solutions, portfolios of products and services

Risk sharing service models, startups create key components

Solutions for patients and providers

Solutions for patients, providers and payers

Data aggregation and analytics (big‐data), Population Health Management Solutions

Cost reduction and Incremental Innovation

Disruptive, innovations that solves health‐system level problems New skills, Bigger Problems

Theoretically Equivalent “Non‐Inferior” Products

Proven Superior Products (Clinically Proven)

Proven Superior Products (Clinically Proven)

Pure focus on clinical outcomes Focus on clinical and economicoutcomes

Drive healthcare delivery efficiency and optimize processes

Physician preference and custom Data driven, analytically proven, and standardized

Automation, analytics (CDSS), big data 

Operating Rooms & Hospitals as primary Revenue Drivers

Operating Rooms & Hospitals as primary Cost Drivers

Technologies that keep patients out of the hospital and OR

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COMPANY CONFIDENTIAL

New “breed” of innovative Value Based Care (VBC) solutions leverage information technology to improve access, reduce cost, increase efficiency and manage risk

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Care Coordination 

Connected Medical Devices

Healthcare Consumer Engagement 

Analytics and Big Data 

Population Health 

Management Wearables

and Biosensing

Personalized Medicine 

Telemedicine EHR and Clinical 

Workflow 

Digital Diagnostics 

Home and Retail Care  

Converging biomolecular medicine with technology services and bioinformatics to empower physicians, patients and payers

RECENT FUNDING: $375M

Offers software, services and access to clinical services to anyone who wants to

offer a complete telehealth service

RECENT FUNDING: $130M

Provides partners with a continuous care program, including care coordination, risk

management, and IT enablement

RECENT FUNDING: $125M

COMPANY CONFIDENTIAL

Dave’s (Not So Insightful) Digital Health Predictions1. Internet of Medical Things/Medical Industrial Internet will fundamentally improve patient 

care and reduce costs

2. Connecting well‐care, prevention and sick‐care will align with reimbursement incentives and consumer interest – but behavior change and fundamental differences in well‐care/sick‐care industry dynamics will slow change

3. Big Data will revolutionize healthcare, but generating and leveraging “the right”, real‐time data will drive more immediate value

4. Enhanced access to care (Tele‐Medicine), healthcare process and delivery automation (Kiosks) and the democratization of healthcare knowledge (digitized care paths) will drive care delivery toward lower costs professionals and patients themselves

5. The comprehensively digitized and individualized patient (wearable tech, genomics, etc.) will enable personalized/customized medicine at “mass‐produced” cost.

6. Care coordination across care teams (patient, family, retail, nurse, physician,), care sites (home, retail, acute) and along the continuum of care (wellness to monitoring) driven by connectivity and digital care plans, will identify tremendous opportunities for improved carewhich will be gradually addressed by broad‐based “solutions”

7. Healthcare best‐practices and clinical guidelines will be more defined by looking backward at robust historical data than looking forward at prospective clinical trials.  Watson, Explorys, etc. will identify broad opportunities for healthcare efficiency improvement. 

Updated January 2014

BD Overview

• Enabling safer, simpler and more effective parenteral drug delivery

• Improving clinical outcomes through new, accurate and faster diagnostics;

• Providing tools and technologies to the research community that facilitate basic science, drug discovery and cell therapy;

• Enhancing disease management in diabetes, women’s health and cancer, and infection control.

• Improving clinical, laboratory and research practices in emerging markets

Strategy and Focus Areas

Drive revenue growth through investment in innovation

BD’s Strategy is to Apply Technology and Clinical Knowledgeto Make Healthcare More Effective, Efficient and Safe.

The Five Areas of Focus Are:

BD’s Strategy is to Apply Technology and Clinical Knowledgeto Make Healthcare More Effective, Efficient and Safe.

The Five Areas of Focus Are:

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BD SafetyGlide™Injection Needle BD Nexiva™ Closed IV

Catheter System

BD PosiFlush™Heparin-filled Flush Syringe

BD Soluvia™ Prefillable Microinjection System

Enabling safer, simpler and more effective parenteral drug delivery

BD Emerald™ Syringe

BD Sterifill Advance™ Plastic Prefillable Syringe

Insert BD Simplist here

BD Simplist™ line of ready-to-administer prefilled injectables

Improving clinical outcomes through new, accurate and faster diagnostics

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BD Viper™ System with XTR Technology

BD MAX™ SystemBD FocalPoint ™ GS

Imaging System

BD Kiestra™ Total Lab Automation

BD Veritor™ System

BD BACTEC™ FX

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Providing tools and technologies to the research community that facilitate basic science, drug discovery and cell therapy

BD FACSVerse™ Analyzer

BD™ LSR II

BD FACSCanto II™ Flow Cytometer

BD Accuri® C6 Flow Cytometer

BD FACSCount™ SystemBD LSR Fortessa™ Cell Analyzer

Research Technologies Clinical Technologies

BD FACS Jazz™

BD FACSCalibur™

BD FACS™ Lyse Wash Assistant

Enhancing disease management in diabetes, women’s health and cancer, and infection control

12BD Viper™ System

with XTR Technology BD BACTEC™ FX

Women’s Health and Cancer Infection Control and Patient Safety

BD PosiFlush™Heparin-filledFlush Syringe

BD SurePath™PAP Collection System

Diabetes Care

BD Ultra-Fine™ Nano 4mm Pen Needles with PentaPoint™ Comfort

BD AutoShield™ Pen Needle

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NantHealth5/21/2015

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BD TO ACQUIRE CAREFUSION FOR $12.2 BILLION

Combination of Complementary Portfolios Creates Global Leader in Medication Management and Patient Safety Solutions

Accelerates BD’s Strategy to Improve Quality of Care and Reduce Healthcare Costs; Enhances Emerging Market Growth Opportunities

Generates Significant Value for Shareholders; Accretive to Cash EPS on a Double-Digit Percentage Basis in the First Full Year

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COMPANY CONFIDENTIAL

The Combined Product Portfolios Would Enable an End-to-End Medication Management Solution from Pharmacy to Patient

Coronado Portfolio

BD Portfolio

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What’s Next …

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“Link Diagnosis and Care Delivery to Solve Health System Problems and Improve the Lives of Individual Patients”

“Link Diagnosis and Care Delivery to Solve Health System Problems and Improve the Lives of Individual Patients”

BD’s Medical Internet of Things!BD’s Medical Internet of Things!

Personalized Health System Level Solutions

(Reduce Cost & Improve Outcomes)

Personalized Health System Level Solutions

(Reduce Cost & Improve Outcomes)

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Entrepreneurship

(Medical Robotics Startup)

ProductsProducts

David Feygin, VP Health IT Integration & Strategic Innovation (Former VP Corporate Strategic Innovation)

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Deep Technical &Medical Understanding

(Ph.D. in Medical Robotics)

ScienceScience Slides!Slides!

Commercial Strategy & Innovation

(MBA & Business Strategy)

I am driven to create new understanding, new products and new enterprises that dramatically improve people’s livesCommon Thread:

Mission: To provide a clear path for outside‐the‐home‐court innovation that supports our corporate growth strategy and corporate mission of helping all people live healthy lives. Our first area of focus (Part 1) is ensuring a clear path for OTHC innovation that lead to solutions beyond our core.

Mission: To provide a clear path for outside‐the‐home‐court innovation that supports our corporate growth strategy and corporate mission of helping all people live healthy lives. Our first area of focus (Part 1) is ensuring a clear path for OTHC innovation that lead to solutions beyond our core.

Unfortunately, BD Has Not Been Able to Capture Such High Value Opportunities Outside Our Core…but Change is Coming!

Comprehensive Examination

• Leading Growth and Innovation Course• Growth Leader Panel• GM Accelerator Innovation Diagnostic• Innovation Profile

Consistent Diagnosis

Significant Gaps

•Bias toward home court when competing w/innovations• Insufficient, dedicated resources for synthesis•No innovation process or funnel (ideas have no pathway)•No accountability for innovation•Risk averse & inwardly focused behaviors

Clear   PrescriptionBD Innovation Work 

System

• Search, Synthesis, Select & Execution•BU, Regional  & Corporate Systems• Innovation clearinghouse enables oversight and like vs. like comparisons

•Dedicated corporate group accountable for innovation system and search/synthesis of white space opportunities

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Purpose of our BD Innovation System

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Outside the Home Court

Home Court

The BD Innovation System:

• Provides a clear path for outside‐the‐home‐court innovation that leads to solutions beyond our core

• Enables us to search for opportunities, synthesize ideas into innovation, select innovations for greatest impact, and execute innovation

Why do we need an Innovation System?

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• Today, the healthcare industry is changing in fundamental ways 

Upgrades to BD’s core products not sufficient to completely achieve our desired growth aspirations

Need outside‐the‐home‐court innovation as well

• Established structures, behaviors, and processes acting like “prevailing winds” against efforts to seek and pursue outside‐the‐home‐court innovation

Need different structures, behaviors, and processes to support outside‐the‐home‐court innovation

Outside the Home Court

Home Court

What is the BD Innovation System?

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• New Accountable Structures, new Behaviors and Culture, such as Constructive Challenge, and a new rigorous yet dynamic, multi‐stage Innovation Process

• The Step 5 Coalition is our leadership change network that will build critical awareness and make connections across BD

• Implementation is already well underway 

Accountable Structures, Customer Centricity, Innovation Process, Cultural Change and “Network Based” Change Enable OTHC Innovation

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Red Teams

Negative Experts

Functional Challenge

Rules of Challenge

Robust Innovation Process & Portfolio

BDX Innovation Council Strategic Innovation Groups

Established OSMT  

ConstructiveChallenge

AccountableStructures

Leadership ChangeNetwork

BDT “Innovation Center”

6 BU Innovation systems

Execution LeadsShared Value

EuropeInnovation

BD TechHR/Talent

SynthesisLeads

AsiaInnovation

Policy/Regulatory& Medical

R&D & Science

Bus‐Dev/Corp‐DevFinance

IP andLegal

BU StrategicMarketingHEOR

CSIG, Strategic Innovation Leads

Emerging Regional Innovation Systems

Step5

Coalition

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Innovation System – Idea JourneyManages the entire BD Innovation Portfolio

BDXInnovation Council

BU/Regional Innovation Council

Strategic InnovationLeader

BDT

Corporate Strategic Innovation Group

Medical

Strategic Marketing

HEOR

R&D

Regulatory

Transitional or Adjacent Spaces Outside Business and Regional Efforts or Cross‐Business Initiatives

Idea2

Idea1

X‐Functional Support & Challenge

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Outside‐the‐home‐court innovations move through the Stages of the Innovation Process:

0 Direction for Innovation ‐ Explore spaces and trends in order to uncover unmet needs of select current and potential customers, and connect our innovation efforts to benefits and outcomes they desire and deem essential.

1 Needs & Problems –What is the problem you are trying to address? What is the scale of the problem?2 Business Opportunities – Is the need clearly identified? Could the hypothesized solution achieve significant differentiation for BD?3 Characterized Space & Opportunities –What do we know about this space? Who are the competitors? What does the 

environment and landscape look like? What opportunities exist and how could BD capitalize on those opportunities?4 Actionable Strategy – How does BD win? How do we capture and maintain sustainable competitive advantage?5 Incubate & Execution – How do we nurture and support this new solution? Where in BD does it fit? How do we ensure a smooth 

transition into our existing infrastructure?

Stages of Innovation

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Innovation System – Idea Synthesis

Market AnalyticsMarket sizing, segmentation, pricing, trending, primary, 

secondary market research Market creation strategies

Portfolio approach , sustainable differentiation, stakeholder Analysis, EcoSystem Analysis

Business Development

Relationship management, diligence, negotiating & deal structuring, external partner management

Global Sensing/Sourcing

Angel Networks, VC connections, Investor conferences, regional sensing/sourcing

External Associations to Understand Problems

KOL relationships, Research Centers, Universities

Macro‐economic, Policy, Market, Clinical Trends

Macro Trend Analysis

Health Economics Assessment Including Market Development

Identify large cost areas … cost‐benefit, comparative effectiveness  ….  market development studis/trials

Policy/Regulatory Changes

Alignment of incentives, regulatory paths, reimbursement, establishment of regulatory barriers to entry, policy influence, etc.

Concept Development

Consolidated business plans, Evaluation of novel concepts

X‐Functional Innovation Synthesis

Corporate Strategic Innovation Group (CSIG)

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Responsibilities• Shares responsibility for innovation performance with BD Innovation Council

• Engages on selection of innovations• Implements support and challenge systems

• Manages innovation funnel

Cross Business & Outside the CoreSearch & Synthesis

Center Of Excellence for Innovation

Ownership of BD Innovation System

• Support Business Unit implementation of Innovation IIG to synthesize or execute a >$250M top‐line innovation

• Coordinate global Search & Synthesis 

• Track innovation performance metrics

• Drive Search, Synthesize, Select excellence

• Work with Business Unit Innovation Systems (Cells, Councils, etc.) to implement and coordinate best‐practices

• Develop white space and cross business opportunities

• Ensure constant flow of innovation opportunities that enable long term growth by moving the company into new growth markets

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Backup

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BD Locations

Industrialized Markets

Emerging Markets

Latin America - 1952

• ~5,200 Associates

• 8 Countries, 5 Plants

U.S.A. - 1897

• ~12,000 Associates

• 29 Plants

•

Canada - 1951

• ~550 Associates

• 1 Plant

Asia Pacific - 1971

• ~4,600 Associates

• 16 Countries, 5 Plants

India - 1995

• ~550 Associates

China - 1994

• ~2,200 Associates

Europe - 1952

• ~6,000 Associates

• 21 Countries, 10 Plants

•

Japan - 1971

• ~600 Associates

• 1 Plant

•

EMA - 1994

•~ 250 Associates

• 10 Countries

*note: last updated April 2013

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BD Foundation: Our Purpose and Values

“Helping all people live healthy lives”

We treat each other with respect

We do what is right

We always seek to improve

We accept personal responsibility

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The “Three Greats”

Great performance for customers and shareholders

Great contributions to society

Great place to work

FY 2013 Revenues: $8.054B

BD Biosciences$1.1B

BD Medical$4.3B

BD Diagnostics$2.7B

By Segment: By Geography:

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BD Medical

Focuses on providing innovative solutions to reduce the spread of infection, enhance diabetes treatment and advance drug delivery.

Customers Served• Hospitals and clinics• Physicians’ office practices• Consumers and retail pharmacies• Governmental and nonprofit public health agencies• Pharmaceutical companies• Healthcare workers

Products• Needles and syringes• Intravenous catheters• Safety-engineered and auto-disable devices• Prefillable drug delivery systems• Prefilled IV flush syringes• Insulin syringes and pen needles• Regional anesthesia needles and trays• Sharps disposal containers• Closed-system drug transfer devices• BD Simplist™ line of ready-to-administer prefilled injectables• Medication workflow solutions

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BD Diagnostics

Focuses on improving quality, increasing productivity and ensuring flexibility to help laboratories guide medical decisions.

Customers Served• Hospitals, laboratories and clinics• Reference laboratories• Blood banks• Healthcare workers• Public health agencies• Physicians’ office practices• Industrial and food microbiology laboratories

Products• Integrated systems for specimen collection• Safety-engineered blood collection products and systems• Automated blood culturing systems• Molecular testing systems for infectious diseases and women’s health• Microorganism identification and drug susceptibility systems• Liquid-based cytology systems for cervical cancer screening• Rapid diagnostic assays• Plated media• Microbiology laboratory automation

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BD Biosciences

Focuses on continually advancing the science and applications associated with cellular analysis.

Customers Served• Research and clinical laboratories• Academic and government institutions• Pharmaceutical and biotechnology companies• Hospitals and reference laboratories• Blood banks

Products• Fluorescence-activated cell sorters and analyzers• Monoclonal antibodies and kits for cell analysis• Reagent systems for life science research• Cell imaging systems• Cell culture media and supplements for

biopharmaceutical manufacturing

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FY2013 Shared Value Outreach

• Pursue our purpose through long-standing relationships with non-governmental organizations.

• Corporate grants, product donations,

volunteer service initiatives and disaster relief

programs

• Donate time, technical expertise and resources

• Contributions: ~$11 million – Product donations: $5.1 million (fair market value)– Cash support: >$5.9 million, including $940,000

in matching gifts

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FY2013 Shared Value Outreach

Associate engagement programs:

– International volunteer opportunities:• BD Volunteer Service Trip Program

• BD/PEPFAR Lab Strengthening and Safe Blood Collection Programs

– Henry P. Becton Volunteer Impact Awards Program

– Paid-time off for Volunteer Community Service hours (U.S.)

– U.S. Matching Gifts Program: $940,000 to match associate giving

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FY2013 – Top Corporate Contributions*

1. AmeriCares*

2. Catholic Medical Mission Board*

3. Heart to Heart*

4. Project HOPE*

5. Direct Relief International*

6. National Cancer Coalition*

7. U.S. Fund for UNICEF

8. Joint Commission’s Center for

Transforming Healthcare

9. GHESKIO TB Hospital, Haiti

10.Accordia Global Health

Foundation

Awards and Recognitions: Highlights

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