A presentaçao sobre o mercado da saúde

A presentação sobre o mercado da saúde Ignacio Riesgo PwC Spain

www.pwc.com/es

2º Health Open Day 26 de Outubro de 2011

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Table of contents

1.  Healthcare systems megatrends

2.  European healthcare public systems overview

3.  Main issues of European private healthcare sector

4.  New players: private equity companies

5.  Challenges of European health systems

6.  Main trends of healthcare systems in Europe

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Healthcare systems megatrends

1

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Ten major forces are driving change in the health sector

1.  Healthcare is expected to be the sector with the highest growth in the future.

2.  Changes in disease patterns and demography.

3.  Great impact of new medical technologies.

4.  Great impact of ICT.

5.  Concerns about quality.

6.  Appearance of the “new consumer“.

7.  Revolution in the way of providing services.

8.  Changes in the paradigm of the biomedical model.

9.  The emerging “new health economy”.

10.  A place for global players?

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1. Healthcare is expected to be the sector with the highest growth in the future

Healthcare cost growth over GDP estimations

Source: WHO, PwC Analysis

20,6%

20,3%

20,0%

19,5%

19,1%

18,7%

18,3%

17 ,9%

17 ,5%

17 ,2%16,6%

16,3%

16,0%

21,0%

14,5%

14,0%

13,5%

13,0%

12,5%

12,0%

11,5%

11,0%

10,5%

10,0%

9,5%

9,0%

16,0%

6%

8%

10%

12%

14%

16%

18%

20%

22%

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

15,5% 15,0% 16,9%

OECD w/o US US

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2. Changes in disease patterns and demography

•  Ageing population.

•  More chronic diseases burden.

•  More mental diseases burden.

2000 2020 (projected)

0

80

120

160

40

Millions of American affected

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3. Great impact of new medical technologies

Design drugs

Diagnostic imaging

Minimally invasive surgery

Test and genetic maps

Gene therapy

Vaccine

Artificial blood

Xenotransplantation

Manufactured by identifying the physical structure and chemical composition of the target and designing molecules that act on it.

Progress in all areas: energy source, technology of detection, image analysis and visualization technologies.

Advance in optical fiber technology, miniaturization of instruments and navigation systems at catheters.

The detection of genetic predisposition offers the basis to begin preventive measures. The test has been developed to detect almost 500 diseases.

The artificial introduction of genetic equipments to replace defective or eliminated genes. There are over 2.000 patients at clinical trials worldwide.

This avoid the organ limitation and treat other diseases such as diabetes and Parkinson.

Stem cells utilization The magnitude and impact of the use of stem cells will be huge in the coming years. The first successful will come with skin and bones and then with organs and tissues.

New uses of vaccines for non-infectious disease. It´s expected a great potential to prevent cancers that it´s related with virus.

The FDA has recently approved products with synthetic hemoglobin, which can be an ideal replacement for blood transfusions.

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4. Great impact of ICT

Patient

Physician

Information and clinical decisions

Medical knowledge

Medical History

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5. Concern about quality

Number of deaths per year

Sources: National Vital Statistics Report, Institute of Medicine

Deaths from medical errors compared to other common causes of death

Medical errors

44.000-98.000

Motor vehicle

accidents 47.000

Breast cancer 41.000 HIV

14.000

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6. Appearance of the “new consumer”

We define new consumers as people who have al least two of the following three characteristics:

•  Discretionary household income of $53.000 or more (in constant 2998 dollars).

•  At least 1 year of college education. •  Experience with information technology (e.g. owns a PC).

Description of new consumer attributes in 2005

Source: US Department of Labor.

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7. Revolution in the way of providing services

Revolution in care delivery

New drivers… •  Connectivity and new care/disease

management models

•  Telemedicine

•  Electronic Health Record (EHR) / Personal Health Record (PHR)

•  Health 2.0

•  Disruptive innovation through new entrants (ie: Google, Microsoft, etc.)

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8. Changes in the paradigm of the biomedical model

Biomedical model Future

Episodic care Chronic disease management

Goal: recovery Control and adaptation to the disease, when recovery is not possible

Fee for service Subscription

Process led by the supplier Process led by the consumer

Curative medicine Predictive medicine

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9. The emerging “new health economy”

Cosmeceuticals

Foods and supplements

Dietetic treatments

Alternative medicine

Functional foods

Well-being

Traditional Healthcare

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USA, Hong Kong, India, Malaysia, Filipinas, Portugal

Sweden, Denmark, Finland, Norway, France, Germany, UK, Spain

UK, Australia, Ireland, Saudi Arabia, Spain, Thailand, Hong Kong

Germany, Belgium, Netherlands, Luxemburg, Portugal, Czech Republic, Norway, Sweden, Spain and China

10. A place for global payers?

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European healthcare public systems overview

2

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Countries in Europe have tended to adopt versions of the three main models of health care

•  Tax-based systems in western Europe.

•  Social health insurance countries in western Europe.

•  Central and Eastern Europe.

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The Bismark model prevails in Continental Europe

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Main characteristics of the Bismark model

Contribution collector: Third-party payer

Population Providers

= sickness funds

bipartite self-government

Public-private mix Mandatory insurance

Usually wage-related contribution

Contracts

Limited government

control

Free access

Choice of fund

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The Beveridge model prevails in Britain, the nordic countries and some southern European countries

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Classical integrated NHS- type system

Central government

Population

General taxation NHS = payer & provider

Limited choice Public providers

Main characteristics of the Beveridge model

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Traditional CEE model

Nikolai Aleksandrovich Semashko

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Main characteristics of the CEE model

The healthcare systems in 1990

Central government

Population

General taxation

Hierarchical subordination & limited resource allocation

Limited choice Public providers (hospital be numbers high, provider incentives low)

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Regarding to the previous models and the relative position of the European countries in relation to public and private expenditure on healthcare, does countries can be positioned as follows

Source: Mercer Pan-European Health Care Survey 2008.

Social insurance model Tax-funded model

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Healthcare reforms have been a constant phenomena in Europe over the last years

Controlling the cost of health

care

Improving coverage and

access

•  Broadening the population that receives health care coverage, through either public-sector insurance programs or private-sector insurance companies.

•  Expanding the array of health care providers for more consumer choice.

•  Improving access to health care specialists.

•  Improving the quality of health care.

•  Shifting cost from the state to employers and individuals.

•  Seeking to reduce the costs of delivering health care – restructuring service provisions and negotiating terms with health system providers such as private hospitals and pharmacies.

Reforms typically focus in two broad areas:

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Main reforms in European bismarckian countries

•  Social security reimbursement has fallen from 80% to 78%.

•  In January 2011, a new 3,5% tax and increase on the private health insurance premium tax were introduced.

France

•  The Health Insurance Act that came into effect in 2006 has the following key elements:

o  Citizens can change insurers every year.

o  People with low incomes receive compensation for care.

o  Customers and insurers stimulate suppliers to provide better quality.

The Netherlands

•  In 2010, Germany´s cabinet approved a controversial health reform bill that raised employer and employee contributions rates as of 1 Jan 2011 and allows insurers to increase employee premiums as needed.

Germany

•  Healthcare reform is planned, the key goals will include: o Development of national goals. o  Focus on prevention an

promotion. o Restructuring of hospitals. o  Tools to measure the quality of

the health system.

Austria

Source: Healthcare reform in Europe. Paul Ashcroft, 23 March 2011.

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Main reforms in European beveridgian countries

•  In 2011, the main government-run insurer announce the single biggest price increase in the history of the market, premiums for employers and individuals using the Voluntary Health Insurance program will rise by up to 45%.

Ireland

•  Tax deductions for health care costs have been limited.

•  The NHS budget decreased by 12%, and reduced NHS expenses are being sought through 10 measures, such as a 6% decrease in prescription prices, cost controls, improved management and shared services.

Portugal

•  Under the reform plans of 2011, family doctors are being given much more responsibility for health spending because the government wants groups of general practitioners to replace primary care trust.

United Kingdom

•  Budget reduction in all autonomous regions due to the crisis.

•  Important control measures of pharmaceutical expenditure.

Spain


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Main reforms in European CEE countries

•  In 1993/94, the Czech Republic moved to a multiple insurance system.

•  High rates of economic growth permitted the establishment of a generous statutory health car system in 1997.

•  In 2008, the Civic Democratic Party introduced user fees with the aim of limiting consumption of medical services.

Czech Republic

•  Poland split its national health service into several provincial health services. It was only in 1999 that funding and provision were separated by establishing one health fund for each province.

•  In 2003 all health funds were merged into a single national insurance fund.

•  The provider side is very concentrated and possibly over-integrated.

Poland

•  Since 2000, privatization of GP surgeries is encouraged.

•  In 2007, members if the governing coalition reached a compromise on a multiple insurance system. The arrangement, called for the compulsory health insurance to be managed by 22 health insurance funds with joint public-private ownership.

Hungary

•  In 1992 Romania began to slowly decentralize public administration.

•  Romania has faces issues such as an underfunded National Health Insurance Fund, migration of medical staff and high out of pocket payments.

Romania


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There are new phenomena in the public sector in Europe

1.  Competition among insurers: Germany, Netherlands and Switzerland.

2.  Hospital privatization in Germany.

3.  Hospital privatization in Netherlands.

4.  The Nordic case: redesign of the classical Welfare State.

5.  PPPs in Spain.

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Only three countries in Europe allows citizens to acquire private health insurance without still having to pay premiums or taxes to cover health risks under the official system

•  Germany has a sickness fund system. People who earn more than a certain income are allow to leave the funds and buy healthcare insurance on the market.

•  About 10% of the Germans have done so.

•  Is the only country in Europe with a healthcare system more akin to private than a social insurance.

•  All health insurance is private. •  The Health insurance Law defines the

catalogue of benefits to which all Swiss insurance members are entitled. However, individual insurance funds can offer additional benefits over and above this basic package.

• There is a compulsory government-regulated, single-payer system for the expensive health risks and a sickness fund system for the other risks.

• One third of the population is privately insured. Once the Dutch have an income above a certain threshold, they have to leave the sickness fund and are supposed to provide for themselves.

1.  Competition among insurers: Germany, Netherlands and Switzerland.

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In relation to the hospital privatisation, a clear trend to privatization is perfectly obvious in Germany

Hospital ownership 1991-2008

• Between 1991 and 2008 the proportion of for-profit hospitals in Germany increased from 15% to 30%.

• Next to purchase hospitals completely, new forms of public-private partnerships have evolved. One of the trends is to contract out the management of public hospitals to private companies.

2.  Hospital privatization in Germany.

Source: Statistisches Bundesmat 2008.

Nº of hospitals

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In Netherlands, for-profit hospitals will be permitted

•  Healthcare legislation traditionally contained a formal ban on for-profit hospitals.

Traditionally

Nowadays

•  For-profit hospitals will be permitted in order to make it easier for hospitals to attract capital resources on investment.

•  However, there will be restrictions to the extend hospitals can pay their shareholders a return on investment.

•  The basic principle is that profits must be reinvested in hospital care.

•  According to a survey carried out for the Institute of Health Policy and Management, the Dutch are not opposed to the introduction of private capital into healthcare.

3.  Hospital privatization in Netherlands.

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The concept of Nordic welfare state model being redefined

4.  The Nordic case: redesign of classical welfare state.

• By 1994, more than half of the 26 Swedish county councils al the time had introduced some form of purchaser-provider model.

• The number of people purchasing supplementary private insurance is rapidly increasing, from 2,3% of the population in 2004 to 4,6% in 2008.

• When St. Göran Hospital was sold to a private corporation in 2000, it became the largest privately owned hospital in the Nordic region.

• The so-called Stockholm model was based on using the DRG system as a basis for payment. The use of ABF was introduced in Swedish health care in combination with other management reforms.

• A purchaser-provider separation was first introduced for nursing and care services in the early 1990.

• The first private commercial hospital was established in 1985.

• Norway implemented ABF for somatic hospital services based in the DRG system.

• No major efforts have been made to introduce purchaser-provider models in Denmark.

• The first for-profit hospital was establish in 1989.

• The pharmacy monopoly was changed, allowing a small, but gradually increasing, number of over-the-counter drugs to be sold by, for example, supermarkets.

• In the early 1990s, the municipalities allowed more freedom in terms of purchasing services from public, non-profit and for-profit providers.

• Private health insurance plays a modest role. • No national financing model has been

introduced.

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In Spain, the NHS collaborates with the private sector by three means: Public contracts, Public Private Partnerships and Muface System


Public Contracts

Public Private Partnerships

Muface System for state employees

The NHS assigned in 2009 3,570€M to agreements with for profit (2,030€M) and not for profit (1,540€M) private hospitals • Singular contracts:. e.g. POVISA (Vigo), Fundación Jiménez Díaz (Madrid), various hospitals of the Orden de San Juan de Dios, various hospitals in Catalonia, etc. • Contracts for specific healthcare services. e,g. ambulance services, home oxygen services, dialysis, rehabilitation, physical therapy, etc. • Contracts for specific diagnostic tests or therapies in order to reduce waiting lists. e.g. diagnostic imaging (MRI, CAT scans, PET, mammograms, etc), and surgical procedures amongst others. Usually these contracts have very different durations, from months to 4 or 5 years.

• Spain currently has 6 hospitals operating under the PPP model (5 in Valencia and 1 in Madrid) with the opening in the next few months of three new hospitals in Madrid (Móstoles, Torrejón y Collado), in addition to a new Radiation Therapy center in the Canary Islands.

• The healthcare company Ribera Salud, the private hospital group Capio Sanidad and private insurance companies (Adeslas, Asisa, Sanitas y DKV) are the key players.

•  In addition, Madrid has entered in a PPP with Ribera Salud for a Central Laboratory that provides services to 7 public hospitals and is looking to expand service to other hospital.

• The public administration provides health care coverage for approximately 2 million civil servants: MUFACE, MUGEJU and ISFAS through Muface System.

3,570€M

586€M

1,400€M

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In Spain, PPP models are transforming hospital market. Only in Madrid, there will be in 2013, 11 hospitals built or managed under this type of contract

Source: DBK, PwC Analysis

7 hospitals in Madrid (PFI) 4 hospitals in Madrid (PPP)

3 hospitales in Alicante 2 in Valencia ( PPP)

1 hospital in Burgos (PFI)

1 hospital in Mallorca (PFI)

1 hospital in Salamanca (PFI)

1 hospital in Baix Llobregat

(PFI)

Public-private partnership hospitals in Spain

Private financing initiatives (PFI) Public-private partnership (PPP)

1

2

Hospital Nº Beds Participants Oppening Awarding (€m) De la Ribera 301 Adeslas 1999 63

Ribera SaludACSLubasa

Denia 132 DKV 2008 97 Ribera Salud

Torrevieja 250 Ribera Salud 2006 80 AsisaAcciona

Infanta Elena 106 Capio Sanidad 2007 ndElche-Crevillente 273 Ribera Salud 2009 146

AsisaL'Horta-Manises 319 Sanitas 2009 137

Ribera SaludH. de Torrejón 250 Ribera Salud 2011 n.d.

AsisaConcesiaFCC

H. de Móstoles 260 Capio Sanidad n.d. ndH. Collado Villalba 150 Capio Sanidad n.d. nd

Hospital Nº Beds Participants Oppening Awarding (€m) Son Dureta 900 Dragados, FCC Under constr. 635 Baix Llobregat 238 Emte, Teyco, Acsa, La Caixa 2009 ndBurgos 678 Grupo Norte, OHL, cajas ahorros Under constr. 242 Salamanca 912 nd nd ndHenares 194 Sacyr Vallehermoso, Testa y Valoriza 2008 93 Infanta Sofia 283 Acciona y Crespo y Blaco 2008 98 Sureste 125 FCC, OHL y Cajamadrid 2008 49

PPP hospitals

PFI hospitals


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Main European Healthcare PPPs since 1997

6.  PPPs in Europe.

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Main European Healthcare Privatizations since 1999


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Hospital privatization drivers

•  The cost pressure on market participants in the hospital sector is intensifying.

•  Inefficient hospitals and facilities under a structural handicap will increasingly be unable to cope with that pressure.

•  But the populations demands on the state are increasing.

•  This means that the state must be very careful in allocating its limited financial resources as these are urgently needed for a variety of other public tasks besides healthcare, such as education and unemployment relief.

•  Against this background, the number of public hospital owners who wish to sell their hospitals will continue to rise. For example in Germany the number of public hospital owners is predicted to fall by 25% over the next 15 years, from the current total of 2,258 to 1,700, with most of them being owned either by private companies or by non-profit organizations (Source: British Medical Journal, 2004).


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Hospital privatization options

•  Governments exploring hospital privatization have several options, depending upon the nature of the region's present system and the external market area. They might:

o Sell the hospital asset to a private company;

o Lease it to a private management firm;

o Enter into a joint operating agreement (whereby the government relinquishes direct management of the hospital but maintains a presence via board members);

o Begin a joint venture, where both private and public sector partners maintain ownership of the hospital;

o Start a public private partnership (where government sells the hospital, but purchases back bed space); or

o Engage in comprehensive outsourcing of hospital duties.


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Hospital privatization pros and cons

•  Privatization of public hospitals can sometimes be daunting:

o  It involves crossing a minefield of regulations;

o Selecting the best structural arrangement to meet local goals;

o Negotiating the best deal possible; and

o Handling union and sometimes public opposition.

•  But done correctly, privatization has proven it is worth the effort.

o  It can eliminate waste;

o Save resources;

o Reduce debt; and

o Create a better healthcare system for those who need it most.


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Main issues of European private healthcare sector

3

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The European Union consists of 27 member states, varying in size and purchasing power

Source: OECD Health Data 2010

In red the countries with more purchasing power.

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Various differences exist between European countries

•  Market size. •  Buying power. •  Growth/outlook. •  Innovation.

•  Corporate taxation.

•  Currencies. •  Subsidies/

incentives. •  Etc.

•  Labor laws. •  Intellectual

property. •  Patents. •  Export/import. •  Etc.

•  Language. •  International

orientation. •  Business

practices. •  Etc.

Economics Finance Legislation Culture

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Total healthcare expenditures are greater in those countries with a healthcare model different from the NHS (universal coverage), such as France, Switzerland or Germany

0

1

2

3

4

5

6

7

8

9

10

11

12

7.0%

2.1%

9.0%

6.5%

2.5%

Nether.

9.0%

7.4%

1.6%

Iceland

9.1%

7.6%

1.5%

Italy

9.1%

9.9%

7.1%

2.8%

Sweden

9.4%

7.7%

1.7%

Greece

9.6%

5.8%

3.8%

Denmark

9.7%

8.2%

1.5%

Portugal

Ø 9.4

Czech Republic

7.1%

5.9%

1.2%

Luxemb.

7.2%

6.5%

0.7%

United Kingdom

8.7%

7.2%

1.5%

Ireland

8.7%

6.7%

2.0%

OECD

8.9%

6.5%

2.4%

Spain Belgium

10.2%

7.4%

2.8%

Austria

10.5%

8.1%

2.4%

Germany

10.6%

8.1%

2.5%

Switz.

10.7%

6.3%

4.4%

France

11.2%

8.7%

2.5%

Public healthcare expense Private healthcare expense

Healthcare expense as % GDP, 2008

Source: OECD Health Data 2010

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The role of the private insurance varies according to the country

Source: OECD. * Portugal: 2008 data.:** Netherlands: 2007 data.

Current expenditure on health (%), 2009

20%19%

7% 13% 12%20%

6% 15%

27%20% 17%

30%10%

1%

0%

5%6%4%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

United Kingdom

84%

1%

Switzerland

19%

41%

9%

1%

Sweden

81%

0%

2%

Spain

69%

5% 5%

1%

Portugal*

64%

5%

3%

Norway

72%

12%

1%

Italy

78%

1%

1%

Ireland

74%

1% 11%

2%

Germany

9%

68%

9%

1%

France

5%

72%

13%

1%

Finland

60%

15%

2%

Belgium

11%

64%

5%

0%

Netherlands**

5%

77%

6%

General government Social security funds Private insurance Private households out-of-pocket exp. Other

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Private hospital groups continue to grow and play a larger role in the provision of care to a varying degree in different countries

32374053

6267

100110111

0

20

40

60

80

100

120

Nuffied Hospitals

Spire Healthcare

Sana Rhön- Klinikum

Helios Kliniken

General Healthcare

Capio Générale de Santé

Asklepios

(1) Data from 2010 (2) Helios Kliniken average size per hospital is not representative as the specialize in small hospitals including specialty hospitals for rehabilitation and elderly care. (3) Total revenues include revenues from all sources (inpatient and outpatient) and therefore varies across companies depending on the mix of inpatient and outpatient services and impacts revenue per bed calculations. Source: MSI Data Report Hospitals: Europe (2011); Companies' websites

Number of Hospitals by Major Private European Hospital Groups

Headquarters

Turnover € million FY09 2,163 2,046 1,650(1) 935 1,200 2,320 1,254 696 617

# beds FY09 18,030 16,000 n/a 2,907 1,400 n/a n/a 1,779 n/a

Beds/Hospital 162.4 145.5 n/a 43.4 22.6(2) n/a n/a 48.1 n/a

Revenue/Bed (€K)(3) 120.0 127.9 n/a 321.6 857.1 n/a n/a 391.2 n/a

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Some of the main companies involved in the healthcare sector in Europe are the follows

Company Major presence in Europe Type

Alliance Medical Group Germany, Ireland, Italy, Netherland, Poland, Spain, UK

Provider of outsourced diagnostic imaging services

Ambea Sweden, Finland, Norway Provider of healthcare and care services

BUPA UK, Spain Private medical health insurance plans

Diaverum Estonia, France, Croatia, Czech Republic,

Greece, Hungary, Ireland, Portugal, Poland, Romania, Russia

Renal healthcare company

Euromedic International Bosnia, Bulgaria, Croatia, Czech Republic,

Greece, Hungary, Ireland, Portugal, Poland, Romania, Russia, Turkey, UK

Medical service provider

Fresenius Austria, Belgium France, Germany, Italy, Sweden, UK, Spain Renal care company

Labco France, Italy, Germany, Spain, Portugal, Belgium Medical diagnostic group

Generale de Sante France, Italy Provider of private hospital healthcare services

Jose de Mello Saude Portugal, Spain Provider of health services

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New players: private equity companies

4

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There are some drivers that govern the focused of the private equity companies in the European sector

Market fragmentation (hospitals, long-term care, diagnostic)

Changing regulatory environment

Improving infrastructure in CEE

Increase in the number of private operators

Consolidation opportunities

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Date Target Description Bidder Country Type %Deal Value

(€ M) EV/EBITDA

Jul-10 Centro Medico Teknon Health and allied services, nec Magnum Capital Industrial

SP F 100 140,0 9,3 x

May-09 USP Spain Hospital operator Barclays and RBS UK F 65 n.a.

Jul-07 USP Spain Hospital operator Cinven Group UK F 100 675,0 18,1 x


(€ M) EV/EBITDA

Feb-10 Southmead Hospital It owns and operates hospital. Investor Group UK F 100 497,2

Mar-08 Cromwell Health Group Ltd It owns and operates hospital.British United Provident Assoc UK I 100 114,4

Apr-08 Classic Hospitals Ltd Owner and operator of hospitals. Spire Healthcare Ltd

UK I 100 192,5

Dec-07 Nuffield Hospitals-Hospitals Nine hospitals around UK.General Healthcare Group UK I 100 195,7 12,7 x

Nov-07 Capio Healthcare UK Owner and operates hospital Ramsay Health Care Ltd

AU I 100 285,2 7,9 x

Sep-07Spire Healthcare (BUPA Hospitals) Owner and operator of hospitals. Cinven Group Ltd UK F 100 2458,0

May-06 General Healthcare Group PLC

Own and operate medical and surgical hospitals.

London & Regional Properties

UK F 100 3162,6 12,0 x


(€ M) EV/EBITDA

Mar-10 Groupe Proclif SAS It owns and operates private hospitals. Ramsay Health Care Ltd

AU I 57 87,0

Oct-09 Cliniques Privees Associees French hospital management company. Vivalto Sante (Credit Agricole)

FR F 100 63,0 5,8 x

Jul-09 Groupe Proclif SAS Owns and operates private hospitals. Predica SA FR F 43 70,0

Sep-08 Generale de Sante SA-Hospitals

It owns and operate hospitals & specialty hospitals.

ICADE SA FR I 100 201,7

Nov-06 Tonkin Investissements SA It owns and operates private hospitals. Capio AB SE I 100 146,0 10,4 x

Jan-06 Arvita SA Private hospital operator. Capio AB SE I 100 71,0 7,1 x

Source: Thomson, Merger Market

Spain Sweden

France

United Kingdom

Switzerland


(€ M) EV/EBITDAMar-10 Ambea Health and allied services, nec Triton SE F 75 850,0

Sep-06 Capio AB Diagnostic services, healthcare servicesOpica AB (Apax Partners) SE F 100 2460,0 13,8 x


(€ M) EV/EBITDA

Oct-07 Klinik Hirslanden AG Owner and operator ofhospitals.

Medi-Clinic Luxembourg Sarl

LU I 100 1724,9


(€ M) EV/EBITDA

Mar-10 Krankenhaus Siegburg It owns and operates a hospital. HELIOS Kliniken GmbH

DE I 100 22,0

Nov-09 MEDIGREIF Five clinics as well as two medical care centers.Rhoen-Klinikum AG DE I 94 106,0

Sep-06 Klinikum Uckermark GmbH Own and operate a hospitalAsklepios Kliniken Verwaltungs DE I 94 20,0

Germany

F: Financial; I: Industrial.

*

•  Few cross-border deals •  Few international hospital networks groups •  Recent trend towards the acquisition of individual assets

Relevant comparable deals by country

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0,00x

2,00x

4,00x

6,00x

8,00x

10,00x

12,00x

14,00x

16,00x

18,00x

20,00x

ene-06

mar-06

may-06

jul-06

sep-06

nov-06

ene-07

mar-07

may-07

jul-07

sep-07

nov-07

ene-08

mar-08

may-08

jul-08

sep-08

nov-08

ene-09

mar-09

may-09

jul-09

sep-09

nov-09

ene-10

mar-10

may-10

jul-10

31

Capio acquired Arvita

(7,01x EBITDA)

Bain Capital, KKR & Merrill Linch acquired Hospital Corporation of America

(12,10x EBITDA)

Opica (Apax Partners) acquired Capio

(13,80x EBITDA)

UNCN acquired USP International

(8,90x EBITDA)

Crestview Partners acquired Symbion

Healthcare

(8,90x EBITDA)

Community Health Systems acquired

Triad Hospitals

(10,56x EBITDA)

Ramsay Healthcare acquired Capio UK

(7,90x EBITDA)

Primary Healthcare acquired 80% of Symbion Health

(10,26x EBITDA)

Star Healthcare acquired Terveystalo

(12,48x EBITDA)

Vivalto Sante acquired Cliniques Privees Associees

(5,75x EBITDA)

RehabCare acquired Triumph Healthcare

(6,36x EBITDA)

Cinven Group acquired USP Hospitales

(18,10x EBITDA)

General Healthcare Group acquired Nuffield (9 hospitals)

(12,7x EBITDA) Magnum Capital acquired

Centro Médico Tekon

(9,33x EBITDA)

EV/ EBITDA

Relevant transactions in Europe

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Challenges of European health systems

5

PwC 52

Healthcare sector is facing some challenges that will condition its future evolution

Ageing

Increase in healthcare expenses

Chronic illness in a system designed for acute diseases

European economic recession

Legacy healthcare structure

IT interoperability

Changing legal environment

PwC 53

Main trends of healthcare systems in Europe

6

PwC 54

Main trends of the healthcare in Europe

Development of healthcare to prevention-promotion

Personalized services - personalized medicine

Deep impact of information and communication technologies and exponential growth of health information

Changes in patient role

Regulatory changes and healthcare reforms

Public private partnership

Primary care will become more important

Appearance of global or transnational players (healthcare insurance and providers)

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SWOT Analysis

Strengths Weaknesses

Opportunities Threats

•  Improving healthcare awareness.

•  Availability of skilled workforce.

•  Government´s commitment to healthcare industry improvements.

•  High dependence on the import of hi-tech technology.

•  Manufacturing and R&D activities looking for other areas (US, Asia,..).

•  Harmonization with the EU. •  Healthcare reforms. •  Public private partnership. •  PE are very interested in the healthcare

industry. •  New global or transnational players. •  Advances towards IT interoperability.

•  Negative effect of government prices controls/reimbursement lists on market attractiveness.

•  Slow pace of the reforms.

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Obrigado