quest diagnostics 9_10bearstearns9_11_07
TRANSCRIPT
September 11, 2007
Bear Stearns Healthcare Conference
Patients Growth People
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»Safe Harbor Disclaimer
The statements in this presentation which are not historical
facts or information are forward-looking statements. These
forward-looking statements involve risks and uncertainties that
could cause the outcome to be materially different. Certain of
these risks and uncertainties are described in the Quest
Diagnostics Incorporated SEC filings, including our latest Form
10-K. Additional risks may arise from unanticipated events.
A copy of this presentation is available on our website at www.questdiagnostics.com
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»Who is Quest Diagnostics?
Leader in Providing Healthcare Insights and SolutionsComprehensive Diagnostic Testing
Routine ——» Esoteric• Diagnose• Monitor• Predict• Prevent
Advanced Information Technology SolutionsImprove Care and Efficiency
Facilitate Introduction of New TherapeuticsClinical Trials Testing
Touching the Lives of Patients >150 Million Times in 2006
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»Quest Diagnostics: The Leader
Source: Washington G-2 Reports and company estimatesQuest Diagnostics data is proforma for AmeriPath acquisition
US Diagnostic Testing Market: ~$45 B
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»A Leader Across All Product Lines
$ in millions
Based on 2006 Actual Results, proforma for AmeriPath acquisition
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»Favorable Industry Trends
Growing and Aging Population
Innovations in Science & Medicine
Personal Interest in Health
Convergence of Technologies• Genetic Predisposition• Diagnostic Testing• Diagnostic Imaging • Information Technology
Essential Healthcare Service
Influences >70% of Healthcare Decisions
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»Why Quest Diagnostics?
Superior Patient Experience
Six Sigma Quality
Unparalleled Access and Distribution
Innovative Science & Medicine
Advanced Information Technology
Unique Value Proposition
Sustainable Advantage
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Expanding Usage by Patientsof PSC Appointment Scheduling
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»Unparalleled Access and Distribution
31 Regional Laboratories2 Comprehensive Esoteric Laboratories150 Rapid Response Laboratories40 Outpatient AP Facilities in 19 States~2,100 Patient Service Centers- serving 45 million patients each year4,000 Vans and 20 Airplanes- making 95,000 stops each day45,000 Dedicated Employees
Serving 50% of US Hospitals & Physicians
Touching the Lives of Patients >150 Million Times in 2006
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IOPs
PSCs
RRLsMain Labs∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃∃
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Patient Service Centersand Laboratory Network
~2,300 Laboratories and Patient Service Centers Serving Half of US Physicians
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>115,000 Physician Users and Growing by >1,000 Physicians Each Month
Electronic Connectivity: Care360 Network
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Approach to DrivingProfitable Growth
Provide Differentiated Service at Competitive PricesFocus on High Growth Segments
Cancer DiagnosticsCardiovascular DiseaseInfectious DiseaseMolecular Diagnostics
Introduce Important & Unique Tests & ServicesExpand Geographic Scope
Expand Diagnostic Scope – Near Patient Testing
Increasing Loyalty with Patients, Physicians and Payers
Building a Sustainable Competitive Advantage
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»AmeriPath Acquisition
Creates Leader in Cancer Diagnostics
National Scale with Significant Local Presence• 900 MDs and PhDs• Over 200 Hospital Contracts in 22 States• Approximately 40 Outpatient Anatomic Pathology Facilities
in 19 States
Strengthens Leadership in Hospital and Esoteric TestingStrengthens Relationship with Physicians and PayersAccelerates Revenue and Earnings Growth
Integration Activities are On Track
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»Near Patient Testing
Attractive benefits for hospitals and physician offices
Enables more timely and effective decisions
Expanding product menu
Combine with central lab results to createcomplete patienttesting record available tophysicians and plans
An Opportunity to Improve Patient Care and …
…to Reduce Medical Costs
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Improving Revenue Mix to Higher Margin, Differentiated Services
Quest Diagnostics 2002 Revenue
Gene-based and Esoteric16%
Anatomic Pathology10%
Routine67%
Drugs of Abuse4%
Other3%
Total Revenue: $4.1 Billion
Quest Diagnostics 2006 Pro Forma Revenue
Gene-based and Esoteric17%
Anatomic Pathology17%
Routine56%
Drugs of Abuse3%
Other7%
Total Pro Forma Revenue: ~$7.0 Billion
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»2007 Guidance *
Revenues $6.6 billion to $6.7 billion
Operating Income ~16%
EPS $2.80 – $2.95
Cash from Operations ~$800 million
CapEx $210 - $220 million
Returning to Revenue and Earnings Growth in 2008
A Challenging Environment in 2007
*Excludes $0.04 EPS in Q1 charges.
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»Building on Strength
Industry Leader in a Vital and Growing Industry
−Leadership in All Major Segments
Unique Value Proposition
A Proven Track Record of Integrating Acquisitions
Proven Management Team
Strong Cash Generator
A History of Disciplined Growth
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