Option Care Health, Inc. · NASDAQ:OPCH
Option Care Health — BioScrip — Merger or Acquisition (March 2019)
20 slides from Option Care Health's merger presentation, Mar 19, 2019
Slide 1: A Leading Provider of Home Infusion and Alternate Site Infusion Therapy
A LEADING PROVIDER OF HOME INFUSION AND ALTERNATE SITE INFUSION THERAPY
Slide 2: Disclaimer
INVESTOR PRESENTATION // 2 DISCLAIMER This communication, in addition to historical information, contains “forward - looking statements” (as defined in the Private Secu rities Litigation Reform Act of 1995) regarding, among other things, future events or the future financial performance of BioScrip
Slide 3: Presenters
INVESTOR PRESENTATION // 3 PRESENTERS John Rademacher CEO Option Care Mike Shapiro CFO Option Care Dan Greenleaf CEO BioScrip Steve Deitsch CFO BioScrip
Slide 4: Combining Two Leaders in Home Infusion
INVESTOR PRESENTATION // 4 COMBINING TWO LEADERS IN HOME INFUSION Headquar te r s: Denver , Colorado Headquar te r s: Bannockburn , Illinois Significant Scale 2018 Metrics Expansive and Complementary Footprints Therapeutic Solutions • 76 full service pharmacies • 90 ambulatory infusion suites • Loca
Slide 5: Combination Creates Provider with National Reach and Comprehensive Solutions
INVESTOR PRESENTATION // 5 COMBINATION CREATES PROVIDER WITH NATIONAL REACH AND COMPREHENSIVE SOLUTIONS 1. Includes pharmacy technicians. $2.6bn+ combined 2018 revenue 46 states 96% of U.S. population covered 2,900+ skilled clinicians 1 Top 10 payors all in network Highly complementary footprint exp
Slide 6: Option Care Overview
INVESTOR PRESENTATION // 6 OPTION CARE OVERVIEW • 76 full service pharmacies • 50 state dispensing capabilities • 90 ambulatory infusion suites • Contracted with all 10 of the top 10 national payors • Contracted as a provider of Medicare and Medicaid in all 50 states • >750 payor relationships and >
Slide 7: Option Care Historical Performance
OPTION CARE HISTORICAL PERFORMANCE 1. Adj. EBITDA includes adjustments related to stock - based compensation, loss on dispositions, non - cash portion of debt extingui shment, management fees, and restructuring and other charges. In the past three years , Option Care generated ~$150mm in operating
Slide 8: Core Option Care Growth Has Been Strong
CORE OPTION CARE GROWTH HAS BEEN STRONG Note: Represents performance from 2016 - 2018 excluding impact of CURES Act. 1. Adj. EBITDA includes adjustments related to stock - based compensation, loss on dispositions, non - cash portion of debt extingui shment, management fees, and restructuring and oth
Slide 9: Option Care's Unique Position to Capitalize on Therapy Trends
OPTION CARE’S UNIQUE POSITION TO CAPITALIZE ON THERAPY TRENDS 1. Adj. EBITDA includes adjustments related to stock - based compensation, loss on dispositions, non - cash portion of debt extingui shment, management fees, and restructuring and other charges. Key therapies include anti - infectives,
Slide 10: Option Care's Industry Leading Quality Metrics and Accreditations
96% INVESTOR PRESENTATION // 10 OPTION CARE’S INDUSTRY LEADING QUALITY METRICS AND ACCREDITATIONS 1. Review of Option Care patient data on file April 2017 – June 2017. Data may include some injectable drugs. 2. Review of Optio n Care patient data therapy related admission rates April 2017 – June 201
Slide 11: Partnering with World-Class Shareholders and Board Members
INVESTOR PRESENTATION // 11 PARTNERING WITH WORLD - CLASS SHAREHOLDERS AND BOARD MEMBERS Over 30 years of experience with completed investments in over 140 companies Supportive partnership One of the world’s leading investment firms with approximately $23 billion AUM One of the leading investors
Slide 12: U.S. Infusion Industry Overview
12% 20% 28% 40% Home Skilled Nursing Facility Physician Office Outpatient Hospital INVESTOR PRESENTATION // 12 U.S. INFUSION INDUSTRY OVERVIEW LARGE AND GROWING INDUSTRY OPPORTUNITY Top 6 providers account for <50% of U.S. industry The combined company market share is 21% Highly fragmented ind
Slide 13: Transformational Transaction Creating Meaningful Shareholder Value
x The combination creates a leading independent provider of home infusion x Merger of two best - in - breed platforms in a large and growing industry x Diversified payor mix, in network with top 10 payors x $60+ million of run - rate cost synergies identified x Expected to be realized on a run - rat
Slide 14: Key Transaction Terms
• BioScrip to issue common stock to Option Care in an all - stock transaction • $60+ million of run - rate cost synergies identified • BioScrip shareholders: 20.5% • Option Care shareholders: 79.5% • Chief Executive Officer: John Rademacher • Chief Financial Officer: Mike Shapiro • Draw on best tale
Slide 15: Synergy Potential
SYNERGY POTENTIAL IN ORDER OF MAGNITUDE Streamline corporate and administrative functions including labor and non - labor costs SG&A Optimize assets where applicable to best serve the market Includes associated costs Network Optimization Purchasing at the “best of” price where overlap exists
Slide 16: Challenging BioScrip Capital Structure
INVESTOR PRESENTATION // 16 CHALLENGING BIOSCRIP CAPITAL STRUCTURE Near - term leverage levels are expected to remain high Narrow window to address current capital structure — 1L and 2L debt becomes current in August 2019; 1L and 2L have a springing maturity in August 2020 — Senior Secured Notes
Slide 17: Significantly Improved Pro Forma Capital Structure
BIOSCRIP, INC. INVESTOR PRESENTATION // 17 SIGNIFICANTLY IMPROVED PRO FORMA CAPITAL STRUCTURE Significant deleveraging No near - term maturities Lower cost of capital No preferred equity Covenant - lite Significant additional liquidity ABL revolver for additional capital flexibility Pr
Slide 18: Improved Ability to Invest and Delever
90% 50% BioScrip 2018A Pro Forma Expected INVESTOR PRESENTATION // 18 IMPROVED ABILITY TO INVEST AND DELEVER Improved capital flexibility Increased ability to invest in and enhance patient experience Continued investment in quality management system (USP800) Fund growth initiatives Paydown
Slide 19: Pro Forma Combined 2018 Financial Snapshot
INVESTOR PRESENTATION // 19 PRO FORMA COMBINED 2018 FINANCIAL SNAPSHOT 1. Includes identified run - rate cost synergies of ~$60mm. 2. Balances at December 31, 2018. $709 $1,942 $2,651 $45 $95 $200 1 $602 $514 Combined with Run - Rate Cost Synergies Revenue ($mm) Adj. EBITDA ($mm) The combined Compan
Slide 20: The Power of the Combination
INVESTOR PRESENTATION // 20 THE POWER OF THE COMBINATION Leading home infusion platform with national reach and scale Right side of healthcare – independent, low cost care setting, patient centric Enhanced product and payor diversity Sizable and actionable synergies expected Improved capital structu