Progress in CT

Jim GreenSenior Vice President &General Manager Philips CT

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Agenda

• What is CT

• New clinical applications

• CT market

• Why we win

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What is CT?

• Rotate an X-ray source and detection system around the area of interest

• Transmitted X-rays are received by detection system

• Detection system converts X-Rays to digital data

• Computers reconstruct data into a two dimensional cross-sectional image

• Images are viewed by the doctor who diagnoses the patient

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CT’s early days

1970’s • Single-slice head scanner• Rotation time in minutes • 10 images (slices) per study

Simple head scan• 10 images• Total scan time: 1 hour

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CT’s come a long way!

Today• World’s first 4cm large coverage CT• Acquires up to 40 images per rotation• Rotation time in 4/10ths of a second• Sub-millimenter resolution• True volume acquisition• 3-Dimensional viewing

Whole body scan• 3,750 slices• Scan time: 33 seconds

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Agenda

• What is CT

• New clinical applications

• CT market

• Why we win

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Top 5 Leading Causes of Death in US

1. Heart disease

2. Cancer

3. Cerebrovascular / Neuro (stroke, etc.)

4. Chronic lower respiratory(COPD, emphysema, etc.)

5. Accidents(auto crashes, etc.)

700,142

553,768

163,538

123,013

101,537

Source: CDC, NCHS, National Vital Statistics System for 2001

29%

23%

7%

5%

4%

Total Number of Deaths: 2,416,425

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a

a b

b

Coronary angiogram

CT Breakthroughs in Cardiac

CT Coronary Angiogram• In just seconds• Still-frame 3-D picture• Non-interventional• Complete coronary view• Functional Analysis• Cost effective

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Plaque characterization (in development)

Stent patency

CT Breakthroughs in Cardiac

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Dr. Charles Fitzgerald, Medical Director, Heart Care Clinic of Arkansas, Little Rock, AK, USA

Cardiac CT

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CT Breakthroughs in Cancer DetectionFast detection of lung cancer

• 3 second lung scan• Computer aided detection• Easy / fast follow-up

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CT Breakthroughs in Cancer DiagnosisAccurate, patient-friendly, Virtual Colonoscopy, in seconds..

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Non Contrast CT CT Perfusion/stroke maps

CT Angiography

CT Breakthroughs in NeurologicDiagnosisComprehensive Stroke Review w/ CT “In minutes, not hours”

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0102030405060708090

100

1993 1998 2003 2008

Neuro

Guided Proc.Spine

Chest/Thorax

Pelvic/ Abdominal

Cardiac & Vascular

6.6% CAGR6.6% CAGR

CancerDetection

14.5% CAGR14.5% CAGR 14.0% CAGR14.0% CAGR

Pro

cedu

res

in M

Sources: IMV and Philips internal estimates

New Clinical Applications

multi-slice large coverage

CT Procedure Growth in U.S.

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Agenda

• What is CT

• New clinical applications

• CT market

• Why we win

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0

500

1000

1500

2000

2500

3000

90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06

Based on common currency (2003 FX rates)EUROS M

Multislice CTIntroduction

Spiral CT Single Slice

Multislice Large

Coverage>16 slice

6% CAGR 1990-2003

Total CT Global Equipment Market History

Sources: Philips internal estimates, NEMA, COCIR, JIRA

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€ 1,232

€ 316€ 214

€ 101 € 97 € 66

€ 0

€ 200

€ 400

€ 600

€ 800

€ 1,000

€ 1,200

€ 1,400

U.S. Japan China France Germany Italy

Euro M

World Top 6 CT Markets by Size (2003)

Sources: Philips internal estimates, NEMA, COCIR, JIRA

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Fcst

Fcst

12.7%

13.8%14.2%

16.5%

0

500

1,000

1,500

2,000

2,500

3,000

2001 2002 2003 2004 2005 2006 2007

MAR

KET

EUR

OS

M

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

16.0%

18.0%

PH

ILIP

S S

HAR

E %

----

CT Global Orders Market and Philips ShareComments:• ‘03 & ‘04 market decreases

driven by currency• China has excellent growth

opportunity• Strong incremental growth

in Japan• Strong in Europe due to

technology orientation and Philips brand

• NA experienced initial integration issues but is now on track

Projected CAGR 4.1% ’04-’07

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Agenda

• What is CT

• New clinical applications

• CT market

• Why we win

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• Royal Philips Research• Technology leader in detection, with large area coverage• Patented Tach technology, more complex than Pentium

Why we win: Technology Leadership

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• Snapshot 3D volume picture• In less than 400msec• Perfect for pediatrics• Most dose efficient

4 cm

4 cm volume segment

22-day-old child

Why we win: Advanced Applications

Technology enables the most advanced applications

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Why we win: First to Market

History of Firsts to Market • 1980: Solid-state detector

1988: Continuous rotation slip ring CT

• 1991: Multi-slice CT (dual) • 1992: MRC (liquid metal

bearing) X-ray tube• 2002: The First 16-slice CT

First to Market: FDA approved for sale and systems in clinical operation

Today • First with 4cm large coverage

CT (40 slice)• Breakthrough applications:

Neuro & Cardiac• The clear leader in technology

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Dr. Jonas Rydberg, Associate Professor, Department of Radiology, Indiana University, USA

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Conclusions

• Backed by Royal Philips Research• Technology drives our costs down, and enables breakthroughs• First-to-market enables our premium pricing• New geographical markets drive our marketshare• Clinical breakthroughs and emerging market segments

are driving our growth