1. Kuwait Healthcare Reform 2009 Presented by Julie B. Decker Managing Director, Lynxcom Partners Operating Partner, Director of Healthcare Practice, FocalPoint Partners

2.  Healthcare Market and Growing Costs  Defining the Alternate Site of Care  Home Infusion  Ambulatory Infusion Centers  Hospice  Home Health 2

3. 3  FocalPoint Partners – Operating Partner & Director Healthcare Practice Largest independently-owned investment bank in Southern California, founded in 2002, with offices in Los Angeles and New York Run by seasoned veterans, with backgrounds in:  Distressed markets  Turnaround management  Private equity  Investment banking  LynxCom Partners – Managing Director Healthcare consulting firm based in San Diego providing M&A advisory, global sales development, marketing organizations, financial turnaround with expertise in:  Alternate site and home health  Biotechnology and life sciences  Pharmacy, nursing and DME Law Public accounting Strategy consulting Senior lending Payer relations, reimbursement and regulatory affairs Business development and operations Healthcare information services

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7. Total healthcare expenditures were $2.4 trillion USD $8,000 per person 16% of the GDP 2007 National health expenditures expected to rise 6.9% 2008 Spending expected to grow to $4.4 trillion USD 20% of the GDP 2017 7

8. 8 Healthcare Expenditures as Percent of Gross Domestic Product

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10. 10 2007 Total Expenditure = $2.241 trillion USD

11. Emphasizing the importance of Alternate site of care Disease management Outcomes, benchmarking, quality Compliance, patient management Preventative care ER triage, admission diversion, bed day reduction Alternate site of care developed as way to reduce costs 11

12. Plans looking for alternate site of care Vertical integration of health plans PBMs Specialty pharmacy Infusion pharmacy Diabetic supplies Industry consolidation Increasing need for outcomes data for disease management Preparation for new drug launches 12

13. TRADITIONAL SITES OF CARE ALTERNATE SITE OF CARE  Hospital Inpatient  Physician Office  Hospital Outpatient  Aggregating disease-specific patients into centers to provide cost effective care  Hospital without walls Dialysis Surgery Centers Infusion Centers Home Care Skilled Nursing facilities Emergency Room Urgent Care Retail Clinic 13

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15.  Pharmacy-based, decentralized patient care Expertise in sterile drug compounding Provides care to patients with acute or chronic conditions in home and alternate sites  Services include: Professional pharmacy services Care coordination Infusion nursing services Supplies and equipment 15

16.  4,000 pharmacies nationwide  Market size $12 Billion  Types Hospital based infusion pharmacy National chains Independent - local and regional  Most are Accredited by JCAHO, CHAP, ACHC 16

17. 17 USP 797-Compliant Sterile Compounding

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19.  Often providing ongoing therapy for chronically ill patients Rheumatoid arthritis Multiple sclerosis Neuromuscular disease Immune deficiency Crohn’s disease Psoriasis Oncology  Common drugs provided ABC Rituximab Remicade (3) IVIG Orencia Tysabri Methotrexate SoluMedrol 19 Located in lab draw centers, surgery centers, physician office: anywhere outside of the hospital to service and train patients

20.  Administration of infusible and injectable therapies Biologicals Oncology therapies Anti-infectives  Patient and caregiver instruction on self-injection  PICC and peripheral line placement  Additional clinical services Clinical trials Hospital inpatient bed-day reduction programs Diagnostics and imaging Vaccinations and flu shots Wound care PT/OT 20

21.  One to many relationship (4:1)  Reduces costs  Improves efficiencies  Manages the nursing shortage 21 AIC Physician Office Home Infusion

22.  AIC placement determined by understanding utilization: Patient population Disease Drug/Therapy Physician Spend Geography 22 X X X X X X X X X X XX X X X X X X X X X X X X X X X X X XX X X X X X X X X X X X X X X X X X XX X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X XX X X X X X X X X X X X X X X X X X XX X X X X X X X MD X = AIC location = prescriber location = patient location

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24.  End of life and palliative care Major healthcare costs are at the end of the patient’s life Hospice offers cost savings by treating terminal patients at home  Rx, RN, pain management, social services  Covered as a Medicare benefit in 1986 Adopted by commercial payers 24

25.  Utilized during last 6 months of life  Difficult to determine prognosis 25 When given a choice, patients choose to be home instead of tethered to a hospital bed

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27.  High-touch patient care in the home Low cost alternative to facility-based care Provides access to care for the homebound and non-ambulatory  Licensed in accordance with State or local law 27

28. Services include: 28 Skilled nursing: RN, LVN Physical therapy Occupationa l therapy Speech therapy Medical social work Home health aides Wound care and ostomy

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30.  How to decide which patients are appropriate for alternate site Clinical factors: high-risk, severity Home setting: appropriate assessment Support/caregiver factors  Understanding utilization Patient populations and costs Disease states Utilization of drugs and services Geographic distribution of patients 30

31.  Medicare  Medicaid  Commercial payers ER Triage Bed Day Reduction  Reimbursement is covered in alternate sites of care 31

32.  Understanding patient populations is key  Know the costs associated with the major diseases and therapies  Building hospitals without walls will reduce administrative costs  Patients respond positively to care in the home  Alternate site improves patient wellbeing 32