Quest Diagnostics Incorporated · NYSE:DGX
Quest Diagnostics — 39th Annual Deutsche Bank Health Care Conference (May 2014)
16 slides from Quest Diagnostics's conference presentation, May 8, 2014
Slide 1: 39th Annual Deutsche Bank Health Care Conference
Quest Diagnostics 39th ANNUAL DEUTSCHE BANK HEALTH CARE CONFERENCE MAY 8, 2014
Slide 2: Safe Harbor Disclosure
Safe Harbor Disclosure This presentation may contain forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date that they are made and which reflect management's current estimates, projections, expectations or beliefs
Slide 3: U.S. Diagnostic Testing Represents a Small Cost but Drives a Disproportionate Impact on Healthcare
U.S. Diagnostic Testing Represents a Small Cost but Drives a Disproportionate Impact on Healthcare Estimated 2012 Health Consumption Expenditures Increasing Role of Diagnostics $2.4T • Diagnostic testing has an Hospital (36%) increasingly important seat at the table in delivering Professional Servic
Slide 4: We Operate in a Highly Fragmented Market
We Operate in a Highly Fragmented Market Total U.S. Lab Market “Outside the Hospital” Independent Lab Segment Lab Segment 61% Other 55% DGX POL 6% Tier 2 Niche 6% Labs Labs Hospital- 9% 10% 8% Outpatient 11% Hospital LH Outreach 19% Small Outside the 33% Independent Hospital- Independent Hospital La
Slide 5: Forces at Work in the Industry
Forces at Work in the Industry Utilization Reimbursement Stakeholder Technology Dynamics Evolution • Favorable • Government and • Physician acquisition • Advances in demographics for commercial by hospitals genomics and organic growth pricing pressure proteomics – Population • ACO formation / • Shif
Slide 6: Trends Contributing to Industry Growth Opportunities
Trends Contributing to Industry Growth Opportunities Esoteric Growth through Disease Focus Hospital Dynamics Related to Lab Services Hospital acquisition of Payors pressure physician practices hospital reimbursement Hospital Hospitals and ACOs Hospitals view turn to partners to labs as cost centers
Slide 7: One Vision, Three Goals, Five-Point Strategy
One Vision, Three Goals, Five-Point Strategy 7|
Slide 8: We are Making Excellent Progress on Our New Five-Point Strategy Launched a Year Ago
We are Making Excellent Progress on Our New Five-Point Strategy Launched a Year Ago Restore: Restore Growth Drive: Drive Operational Excellence Simplify: Simplify the Organization Refocus: Refocus on Diagnostic Information Services Deliver: Deliver Disciplined Capital Deployment 8|
Slide 9: Restore Growth
1 Sales and Marketing Excellence Extend in Adjacent Markets Seven Growth Lead in Companion Diagnostics Create Value from 5 Information Assets 9] Grow Esoteric through our 2 Disease Focus Partner with Hospitals and IDNs Succeed Internationally 4 % As) 4 m r] s g S Quest Ad : . S& Diagnostics
Slide 10: Continued Price and Utilization Pressure will Drive Demand for our Expertise in a Range of Strategic Partnerships
Continued Price and Utilization Pressure will Drive Demand for our Expertise in a Range of Strategic Partnerships ACOs Level of Strategic Joint Venture Partnership Build on experience Outreach with Banner Health Acquisition & UPMC Lab Management 3 outreach acquisitions since & Outsourcing January 20
Slide 11: Drive Operational Excellence
Drive Operational Excellence • Create a superior customer experience using four Strategic Imperatives – End-to-End Customer Value Chain – Enterprise IT Architecture – Business Performance Tools – Cost Excellence – Invigorate • Invigorate goal – Original goal of $500M in savings in 2014 compared to 2
Slide 12: Simplify the Organization
Simplify the Organization Diagnostic Information Services BEFORE NEW Value Value Business 1 Business 2 Business 3 Business 4 Business 5 Creation Delivery General Management Science & Sales & Innovation Marketing Strategic Operations Marketing Support Functions 12 |
Slide 13: Refocus on Diagnostic Information Services
Refocus on Diagnostic Information Services We Have Made Progress on Our Portfolio Review and Generated ~$800 million in Proceeds in 2013 Executed on the following divestitures • Products businesses – Recently completed sale of HemoCue, Enterix and OralDNA businesses • Celera drug assets – Sold Ibrut
Slide 14: Deliver Disciplined Capital Deployment
Deliver Disciplined Capital Deployment • Continue to invest in efforts to Restore Growth and Drive Operational Excellence • Increase value for shareholders – Improve operating performance and deliver disciplined capital deployment – Return the majority of free cash flow to shareholders through a com
Slide 15: One Vision, Three Goals, Five-Point Strategy
One Vision, Three Goals, Five-Point Strategy 15 |
Slide 16: Quest Diagnostics
Quest Diagnostics Rat
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