WSMM_Healthcare_November_Newsletter_V1.pdf

3
Table Of
Contents Healthcare
I. Current Market 5
II. Eli Lilly 12
III. CRISPR 17
IV. Biden’s AI Exec. Order 21
V. M&A Deal 24
VI. December Highlights 33

4
Trading Comps Pharmaceuticals
Name Location Ticker
Shares
(M)
Share
Price
Market Cap
($M) EV/EBITDA EV/Rev
AbbVie Chicago, IL ABBV 1766 $138.30 $244,173 9.9x 5.3x
BioMarin Pharmaceutical Novato, CA BMRN 188.4 $87.52 $16,486 78.9x 7.4x
Bristol-Myers Squibb New York, NY BMY 2035 $50.84 $103 7.1x 3.0x
Corcept Therapeutics Menlo Park, CA CORT 103.1 $25.91 $2,954 25.2x 5.6x
Gilead Sciences Foster City, CA GILD 1246 $74.69 $93,067 9.2x 4.1x
Ironwood Pharmaceuticals Boston, MA IRWD 156.1 $9.78 $315 11.2x 5.1x
Pacira Biosciences Tampa, FL PCRX 46.4 $26.66 $1,238 10.1x 2.4x
Pfizer New York, NY PFE 5646 $29.92 $168,940 11.0x 2.7x
Regeneron Pharmaceuticals Tarrytown, NY REGN 108.9 $802.43 $87,422 16.6x 6.1x
United Therapeutics Silver Spring, MD UTHR 46,993 $228.94 $10,759 8.3x 4.3x
Mean 18.8x 4.6x
Median 10.6x 4.7x

5
Trading Comps Healthcare Services
Shares
(M)
Share
Price
Market Cap
Adapt Health Phoenixville, PA AHCO 136.4 $8.32 $1,135 5.3x 1.1x
Amedisys Baton Rouge, LA AMED 32.6 $93.70 $3,058 17.2x 1.5x
Apollo Medical Holdings Alhambra, CA AMEH 58.4 $32.79 $1,915 15.7x 1.4x
Encompass Health Birmingham, AL EHC 100.2 $64.33 $6,448 9.9x 2.1x
Evolent Health Arlington, VA EVH 115 $28.77 $3,307 27.0x 2.3x
Medpace Cincinnati, OH MEDP 30.7 $276.27 $8,477 23.9x 4.9x
Option Care Health Bannockburn, IL OPCH 177.1 $29.94 $5,303 15.9x 1.4x
Pediatrix Medical Group Sunrise, FL MD 84 $8.72 $733 6.1x .6x
RadNet Los Angeles, CA RDNT 67.9 $31.70 $2,152 10.8x 1.8x
Select Medical Holdings Mechanicsburg, PA SEM 128.2 $23.16 $2,969 9.5x 1.1x
Mean 14.1x 1.8x
Median 13.3x 1.5x

6
Trading Comps Healthcare IT
Shares
(M)
Share
Price
Market Cap
Augmedix San Francisco, CA AUGX 47.6 $4.82 $229 NM 6.5x
Consensus Cloud Solutions Los Angeles, CA CCSI 19.2 $22.70 $435 6.5x 3.0x
Doximity San Francisco, CA DOCS 185.9 $24.04 $4,469 27.0x 9.4x
Health Catalyst South Jordan UT HCAT 57.6 $7.54 $434 NM 1.2x
Mesa Laboratories Lakewood, CO MLAB 5.4 $88.55 $477 16.8x 2.9x
Omnicell Fort Worth TX OMCL 45.5 $32.47 $1,476 21.0x 1.4x
OptimizeRx Waltham, MA OPRX 18.2 $9.72 $176 NM 1.9x
Schrodinger New York, NY SDGR 72.1 $29.33 $2,113 NM 8.2x
Semler Scientific Santa Clara, CA SMLR 6.9 $36.93 $254 9.9x 3.6x
Simulations Plus Lancaster, CA SLP 19.9 $38.39 $765 52.8x 11.1x
Mean 22.3x 4.9x
Median 18.9x 3.3x

7
M&A Comps Life Sciences
Transaction LTM
Date Target Acquirer EV ($mm) Revenue ($M) EV/Rev
11/22/23 T3 Pharmaceuticals Boehringer Ingelheim $508 $140 22.1x
11/17/23 Tenet Healthcare Novant Health $2,400 $552 4.3
11/09/23 NextGen Healthcare Thoma Bravo $1,870 $678 2.4
11/06/23 NKD Pharma Shandong Keyuan $25 $41 5
10/03/23 Point Biopharma Global Eli Lilly $195 N/A N/A
08/17/23 PhenomeX Bruker $108 $79 1.4x

8
M&A Comps Healthcare Information Technology, Healthcare Services
Healthcare
Services
Healthcare
Information
Technology
Transaction LTM
Date Target Acquirer EV ($mm) Revenue ($mm) EV/Rev
08/07/23 Tabula Rasa Healthcare ExactCare Pharmacy LLC $570 $300 1.9x
05/09/23 BenefitsScience Technologies Multiplan $160 NA NA
11/30/22 TSI Healthcare NextGen Healthcare $68 NA NA
09/05/22 Signify Health CVS Health $8,000 $843 9.5x
Transaction LTM
Date Target Acquirer EV ($mm) Revenue ($mm) EV/Rev
11/30/23 Trinity Regional Hostpital Sachse LLC HCA Healthcare $41 NA NA
10/30/23 Seoul Medical Group, Inc. Ascend Partners, Inc. $810 NA NA
06/05/23 Amedisys Optum, Inc. $3,260 $2,223 1.5x
03/20/23 Wisconsin Fertility Institute Invo Bioscience $10 $6 1.8x
02/08/23 Oak Street Health CVS Health $1,060 $1,433 0.7x

9
Clinical Trials Successes, Failures, and New Developments
Drug Condition Phase Objective
Symbicort
Chronic Obstructive
Pulmonary Disease
Phase 4
Combined with Formoterol and BUD to reduce inflammation in the airways and relaxing the muscles around
them, making breathing easier.
Flecainide Atrial Fibrillation Phase 4
Regulate heart rhythm by slowing down electrical signals in the heart. Inhibiting sodium channels in the heart,
stabilizing the electrical activity and reducing the likelihood of atrial fibrillation episodes post-op.
Tacrolimus Liver Transplantation Phase 4
An immunosupressant decreasing the activity of the immune system to prevent it from attacking the
transplanted organ.
Olezarsen
Severe
Hypertriglyceridemia
Phase 3
Block the production of apoC-III for patients who are at risk of disease due to elevated triglyceride levels. ApoC-
III interferes with the receptor-mediated endocytosis of lipoprotein particles.
Godex
Non-Alcoholic Fatty
Liver Disease
Phase 3
Stable reduction in liver fat content and improvement in liver fibrosis when administered over an extended
period in patients.
Sintilimab
Esophageal Squamous
Cell Carcinoma
Phase 2
Used in combination with chemotherapy as a treatment to treat ESCC, which is an aggressive condition that
ranks seventh in incidence and sixth in mortality among all malignancies worldwide.
Xiaopi
Triple Negative Breast
Neoplasms
Phase 2
Compare the efficacy of xiaopi granules and decoction in improving the pathological complete response (pCR)
of neoadjuvant chemotherapy of triple-negative breast cancer.
IMPT-514
Systemic Lupus
Erythematosus
Phase 1
IMPT-514 holds as the first CD19/CD20 dual targeting CAR T-cell therapy with potential to improve disease
activity and renal outcomes for patients with lupus.
ION717 Prion Desease Phase 1 Lower the amount of prion protein in the brain, which can cause fatal dimensia.

10
Table Of
Contents Healthcare
I. Current Market 5
II. Eli Lilly 12
III. CRISPR 17
V. M&A Deal 24

11
Eli Lilly Zepbound Approval
Mounjaro Developments
Revenue Implications
Eli Lilly Stock Since Approval
Production Investments
• The FDA has approved Eli Lilly's new obesity drug, Zepbound
• Zepbound demonstrated an averageweight loss of 18%,
surpassing Wegovy's 15% in drug trials
• Eli Lilly is also working on a pill form of tirzepatide, the active
ingredient in Zepbound currently approved for weight loss
• An approved pill form of tirzepatide can allow Lilly to improve
margins and gain market share in the obesity space
• Eli Lilly is constructing a new production plant in western
Germany, investing $2.17 billion; Lilly's first major production
facility in Germany
• Demonstrates a broader industry trend among drugmakers to
localize production in response to global supply chain
vulnerabilities exposed by the COVID-19 pandemic
• The company plans to reveal extensive investment plans at
upcoming news conferences in Alzey and Berlin, attended by
Germany's economy and health ministers
• Mounjaro has contributed to a 37% gain in third-quarter
revenues for Eli Lilly
• Eli Lilly's Zepbound could generate up to $4.1 billion in US sales
by 2031
• With Goldman Sachs raising their estimate of the weight loss
drug market to $100 billion by 2031, Eli Lilly is positioned to be
a big player in this market
-60%
-40%
-20%
0%
20%
40%
60%
80%
Eli Lilly Amgen Novo Nordisk Pfizer SPY IYH

12
Eli Lilly Novo Nordisk Rivalry
"Bolt-on" Deals
• Novo Nordisk is looking to expand drug portfolio by acquiring
companies in their early-mid stage clinical developments
• Firm is targeting potential deals in the range of a few billion
dollars; wanting to impress its expertise onto smaller firms
• Novo is not seeking any transformative deals as the firm wants
to retain funds for massive research and development spending
• Novo seeks to target firms that have a dedicated
cardiometabolic drug portfolio
• In response to Zepbound'sFDA approval, Novo initiated its
Phase III trial of CagriSema
• Cagrilintide, the compound in CagriSema, is a long-acting
amylin analogue that enhances semaglutide's weight loss
effects which is crucial for Novo's GLP-1 drug portfolio
• Novo aims to produce superior trial results than Eli Lilly's
Zepbound through this comparative trial
Global market share by anti-diabetic revenue (2024 Estimate) Combo Trials

13
Table Of
Contents Healthcare
I. Current Market 5
II. Eli Lilly 12
III. CRISPR 17
V. M&A Deal 24

14
CRISPR Company Overview
Headquarters: Zug, Switzerland
CEO& Director Samarth Kulkarni
Shares Outstanding: 77.7mm
Market Cap: $3.08bn
FY22 Revenue $1.2mm
FY22 R&D 461.6mm
FY22 EPS $(8.36)
52 Week Low/High $37.55 / $72.00
PriceTarget & Recommendation $311.43
Hemoglobinopathies
Exa-cell:β-thalassemia
Exa-cel:Sickle cell disease (SCD)
Immuno-oncology
Anti-CD19 allogenic CAR-T
Anti-CD70 allogenic CAR-T
Anti-CD83 autologous CAR-T
Regenerative Medicine
VCTX210
VCTX 211
VCTX212
In Vivo CTX310: ANGPTL3
CRISPR Therapeutics Products
Established in 2013 in Zug, Switzerland, CRISPR Therapeutics is a healthcare technology company dedicated to
advancing gene-based medicines for prevalent ailments, including hemoglobinopathies, oncology, and rare diseases. At
the forefront of the company’s portfolio is CTX001, a leading candidate for ex vivo gene-editing therapy designed to
address severe sickle cell disease (SCD). The company has forged strategic partnerships with key players in the
industry, including Bayer Healthcare LLC, Vertex Pharmaceuticals, ViaCyte, Nkarta, and Capsida Biotherapeutics.
Company Background

15
Illustrative Example of CRISPR Projected CRISPR Trials and Phases
CRISPR Company and Technology
0
2
4
6
8
10
12
2022 2023 2024 2025 2026 2027 2028 2029 2030 2031
Phase I Phase II Phase III
Clustered Regularly Interspaced Short Palindromic Repeats
What is CRISPR Technology?
On a high level, CRISPR is a set of DNA patterns in bacteria and archaea. These patterns come from bits of DNA from past infections by viruses called bacteriophages. These traces
of DNA help the bacteria/organisms recognize and eliminate DNA from similar viruses in future infections. The promise that CRISPR shows is limitless and has the potential to
completely revolutionize medicine and healthcare—the technology uses the biological information of a disease, like blackmail, against that same disease to eliminate it.

16
CRISPR Technology Overview
• Zinc Fingers, a CRISPR competitor about 10 years ago,
was not widely adopted due to its high cost of
$5,000/unit compared to CRISPR at $30/unit.
• The accessibility of CRISPR technology has expanded in
recent years, allowing more researchers and even
hobbyists to utilize it for gene editing.
• CRISPR revolutionized biomedicine by providing a
precise and versatile tool for gene editing and has the
potential to treat genetic diseases, enhance
biotechnological applications.
• CRISPR technology in agriculture offers the precise
modification of plant genomes to enhance crop yields,
improve stress tolerance, and reduce the environmental
impact of farming.
Gene Editing
Cost Reduction
Gene-edited stem cell
line
Pancreatic endoderm (beta-
cell precursor)
Delivery
device
Patient
Gene Editing Diseases (Diabetes)
Gene Editing in Plants

17
CRISPR Technological Potential
• One-time gene editing program that is focused on
reducingheart disease through techniques:
• Non-viral:Focused on lipid nanoparticles(LNPs)
deliveringCas9 to the liver.
• Viral:For other organ systemsadeno-associated
viralvectors(AAV) are utilized to deliver DNA
encoded for Cas9.
• Engineeringimmunecells to kill cancer in a
specific way while avoidingmany toxicitiesof
normalcancer treatment.
• CRISPR is workingto develop a portfolio of
chimeric antigen receptor (CAR) T cell to be
used in therapy to fight cancer.
• When stem cells are used to repair or replace
tissue or organ function lost due to disease,
damage, or age.
• The first effortfrom CRISPR in regenerative
medicinefocuseson developinga gene-edited
beta-cell replacementproductfor treating
diabetes.
• The aim is to treat sickle cell disease and beta
thalassemia with a gene-editing approach.
• CRISPR-Cas9 introduces fetal hemoglobinand
artificially edits naturally occurringhereditary
persistence of fetal hemoglobin.
Revolutionize Cancer Treatment Heart Disease Reduction
Treat Sickle Cell Disease Tissue Replacement
CRISPR technology has the potential to
revolutionize the healthcare industry.
CRISPR seeks to transform cancer
treatment through engineering and
employing immune cells to specifically
target and eliminate the cancer cells,
while minimizing the toxic side effects
associated with conventional/modern
therapies. The focus is on developing a
range of chimeric antigen receptor
(CAR) T cells for cancer therapy.
Additionally, CRISPR technology is
developing gene-editing techniques to
address genetic blood disorders
including sickle cell disease and beta
thalassemia. In this approach, CRISPR
would edit the DNA of the diseases as a
cure and has the potential ability to offer
a one-time gene editing program.
Furthermore, CRISPR has the potential
to tackle heart disease through both
non-viral and viral methods, provide
tissue regenerative medicine, and offer
repairs for organs affected by disease,
damage, or aging.

18
CRISPR-Cas9 Creation of Fetal Hemoglobin
CRISPR Recent News
The recent regulatory approval of “Casgevy,” the world's inaugural
CRISPR–Cas9 gene editing therapy, represents a groundbreaking
advancement in the treatment of sickle cell disease and β-
thalassemia. Developed by CRISPR Therapeutics and Vertex
Pharmaceuticals, this innovative therapy seeks to address these
blood disorders by introducing fetal hemoglobin to compensate for
the genetic mutations associated with these conditions. The UK's
approval is a notable achievement, marking a significant leap
forward in the field of biotechnology.
Despite the promising prospects of Casgevy, challenges do loom on
the horizon. Initial implementation may be hindered by limited
healthcare infrastructure and potential reservations among
eligible patients. The therapy's intricate administration process,
complex involvements of stem cell mobilization, apheresis, and
myeloablative preconditioning, adds complexity, and the
associated high costs present additional barriers to widespread
adoption. While Casgevy has the potential to transform treatment
approaches, its immediate impact is likely to benefit only a small
subset of patients.
CRISPR-Cas9 Cut & Replace
U.K. Approves World’s First CRISPR-based Medical Care

19
CRISPR Income Statement
In Millions of USD- Standardized
FY 2018 FY 2019 FY 2020 FY 2021 FY 2022
Revenue 3.1 289.6 0.7 915.0 1.2
+ Sales & Services Revenue 3.1 289.6 0.7 915.0 1.2
Gross Profit — — — — —
+ Other Operating Income 0.0 0.0 0.0 0.0 0.0
- Operating Expenses 162.1 242.9 355.2 541.4 674.4
Operating Income (Loss) -158.9 46.7 -354.4 373.5 -673.2
- Non-Operating (Income) Loss 5.5 -20.6 -6.4 -6.0 -22.7
Pretax Income (Loss), Adjusted -164.4 67.3 -348.1 379.5 -650.5
- Abnormal Losses (Gains) 0.0 0.0 0.0 0.0 0.0
Pretax Income (Loss), GAAP -164.4 67.3 -348.1 379.5 -650.5
- Income Tax Expense (Benefit) 0.6 0.4 0.8 1.9 -0.3
Income (Loss) from Cont Ops -165.0 66.9 -348.9 377.7 -650.2
- Net Extraordinary Losses (Gains) 0.0 0.0 0.0 0.0 0.0
Income (Loss) Incl. MI -165.0 66.9 -348.9 377.7 -650.2
- Minority Interest 0.0 0.0 0.0 0.0 0.0
Net Income, GAAP -165.0 66.9 -348.9 377.7 -650.2
- Preferred Dividends 0.0 0.0 0.0 0.0 0.0
- Other Adjustments 0.0 0.0 0.0 0.0 0.0
Net Income Avail to Common, GAAP -165.0 66.9 -348.9 377.7 -650.2
Net Income Avail to Common, Adj -165.0 66.9 -348.9 377.7 -650.2
Basic Weighted Avg Shares 48.0 54.4 65.9 75.9 77.7
Basic EPS, GAAP -3.44 1.23 -5.29 4.97 -8.36
Diluted Weighted Avg Shares 48.0 56.9 65.9 80.4 77.7
Diluted EPS, GAAP -3.44 1.17 -5.29 4.70 -8.36
• CRISPR’s recent financials
show extreme swings in
revenue from year to year.
The notable volatility is
because its revenue
sources are achieved
through grants and
partnerships.
• The Operating income is
extremely volatile from
year to year. This
inherently makes sense
because the swings
correlate directly with the
revenue.
• Furthermore, the
operating expenses
continue to increase YOY
because CRISPR continues
to improve its current
tech, move through
regulation phases, and
build new projects.

20
CRISPR Balance Sheet
FY 2018 FY 2019 FY 2020 FY 2021 FY 2022
Total Assets
+ Cash, Cash Equivalents & STI 456.6 943.8 1,690.3 2,379.1 1,815.3
+ Accounts & Notes Receivable 0.1 0.1 0.1 0.3 0.0
+ Inventories 0.0 0.0 0.0 0.0 0.0
+ Other ST Assets 9.7 43.7 26.1 38.1 37.7
+ Property, Plant & Equip, Net 18.5 72.8 93.0 312.0 320.6
- Accumulated Depreciation 7.4 12.0 21.2 37.8 33.8
+ LT Investments & Receivables 0.0 0.0 0.0 0.0 53.1
+ Other LT Assets 4.1 6.4 18.3 22.3 16.3
Total Assets 489.0 1,066.8 1,828.0 2,751.9 2,243.1
Liabilities & Shareholders' Equity
+ Payables & Accruals 26.3 36.7 73.3 106.5 105.2
+ ST Debt 0.0 8.5 11.4 12.2 15.8
+ Other ST Liabilities 1.4 11.9 9.5 1.2 0.0
+ LT Debt 0.0 44.1 50.1 212.9 228.2
+ Other LT Liabilities 69.1 26.2 19.4 19.7 18.3
Total Liabilities 96.8 127.3 163.7 352.4 367.6
+ Preferred Equity and Hybrid Capital 0.0 0.0 0.0 0.0 0.0
+ Share Capital & APIC 683.8 1,164.2 2,238.0 2,600.5 2,737.3
- Treasury Stock 0.1 0.1 0.1 0.1 0.1
+ Retained Earnings -291.6 -224.7 -573.6 -195.9 -846.1
+ Other Equity 0.0 0.0 -0.1 -5.1 -15.6
Equity Before Minority Interest 392.2 939.4 1,664.2 2,399.5 1,875.5
Total Equity 392.2 939.4 1,664.2 2,399.5 1,875.5
Total Liabilities & Equity 489.0 1,066.8 1,828.0 2,751.9 2,243.1
In Millions of USD- Standardized • The balance sheet tells a
significant portionof
CRISPR’s story. The
companyconsistently
built up its cash
reserves/assets untila
decrease in 2022.
• The increase in cash
illustrates investors’
interest in CRISPR
technologyand the
inflows of grant and
partnership revenues.
• However,in 2022, the
companysaw a drop in
cash and assets.The drop
occurred because the
companysaw very low
revenues/operating
income and a minimal
increase in cash from new
investments.

21
CRISPR Statement of Cashflows
FY 2018 FY 2019 FY 2020 FY 2021 FY 2022
Cash from Operating Activities
Net Income -165.0 66.9 -348.9 377.7 -650.2
+ Depreciation & Amortization 3.5 4.7 9.2 18.0 24.2
+ Non-Cash Items 50.6 -19.9 58.3 119.9 123.2
+ Change in Non-Cash Work Cap 14.6 5.0 43.0 23.4 7.1
+ Net Cash From Disc Ops 0.0 0.0 0.0 0.0 0.0
Cash from Operating Activities -96.2 56.7 -238.4 539.0 -495.7
Cash from Investing Activities
+ Change in Fixed & Intangibles -2.8 -6.7 -18.4 -81.7 -37.2
+ Net Change in LT Investment 0.0 0.0 -522.8 -953.7 -221.5
+ Net Cash From Acq & Div 0.0 0.0 0.0 0.0 0.0
+ Other Investing Activities 0.0 8.0 0.0 0.0 0.0
Cash from Investing Activities -2.8 1.3 -541.2 -1,035.4 -258.7
Cash from Financing Activities
+ Dividends Paid 0.0 0.0 0.0 0.0 0.0
+ Cash From (Repayment) Debt 0.0 0.0 0.0 0.0 0.0
+ Cash (Repurchase) of Equity 8.9 431.0 1,016.2 250.9 38.6
+ Other Financing Activities 307.1 0.0 0.0 0.0 0.0
Cash from Financing Activities 315.9 431.0 1,016.2 250.9 38.6
Effect of Foreign Exchange Rates 0.0 0.0 0.0 0.0 -0.1
Net Changes in Cash 216.9 489.0 236.7 -245.5 -715.9
In Millions of USD- Standardized • The volatility swings between
years (also shown on the
income statement) is
displayed in the Net Income.
Wobbling revenues and steady
increases in operating
expenses are the main reason
the net income changes from
positive to negative numbers
between years.
• As shown on the Balance
Sheet, investors made heavy
contributions from 2019 to
2021, with a slight
contributions in 2018 and
2022. This affected cash
reserves and the assets
overall.
• CRISPR has also recently been
spending more cash on
projects, navigating regulatory
challenges, and creating new
products. Recently,these
ventures have costedthe
company more cash than it
has brought in from operating
and financing activities.

22
Table Of
Contents Healthcare
I. Current Market 5
II. Eli Lilly 12
III. CRISPR 17
V. M&A Deal 24

23
Healthcare AI Market Overview
U.S. AI MarketOverview
• AI healthcare market is projected to grow to
$20.65bn for 2023
• CAGR of AI in US healthcare is 36.1% with a notable
contribution developments of NPL tools/predictive
analysis
• U.S. has a 58% revenue share in the global AI
healthcare market due to increased
private/government funding
• Overview: The recent boom in AI developments, allowed for the slow integration in healthcare,
most notably in the pharma space and healthcare services (improving accuracy for surgery,
primary care doctor screenings)
• Impacts on vertical/news:
• Healthcare Services:
o Healthcare services such as inpatient/outpatient hospital care, physician centers,
ambulatory care, etc., is an ever-changing space that has recently faced some hardships
post-pandemic following the decrease of staff. Approximately 145,213 healthcare workers
left inpatient/outpatient centers EOY 2022 due to the strenuous nature of the job
▪ To combat this, companies such as CHI Health is using AI identification systems to
help workers identify sepsis risk and detect stroke
▪ Healthcare organizations can find top physician talent through Aya Healthcare, a
digital staffing company, recently acquired Winnow AI to identify predictive matches
and referral connections for open roles
• Pharma:
o AI has had a notable impact on the pharma industry, with patents in automated cell
positioning and predictive modeling for new pharma advancements, reductions in clinical
trial time which is (on average 10-15 years), and developments of new drugs. An uptick in
strategic delas signals a collective push to technological advancements
▪ Clinical trial challenges include efficiently recruiting/enrolling patients that meet
selection criteria J&J has deployed AI and ML algorithms to large anonymized
datasets to identify clinical research sites with potential test subjects
▪ Thread Robotics Inc. Developed automated cell positioning method, by tracking and
manipulating gametes with a target region, revolutionizing cell-based
research/therapies
Recent Advancements of AI in Healthcare
$11.1 $15.1
$20.7
$28.2
$38.7
$53.0
$72.6
$99.6
$136.8
$188.0
$
$50
$100
$150
$200
2021 2022 2023 2024 2025 2026 2027 2028 2029 2030
Market
Size
in
($bn
USD)
Year
U.S. AI Healthcare Market Growth Projections

24
Biden's AI Executive Order
Overview Directives
FutureProspects
• President Biden issued a landmark Executive
Order stating new AI safety, security, and equity
standards, inclusive of its use within the
healthcare industry
• Aims to protect Americans' privacy and advancing
equity and civil rights
• Promoting innovation, competition, and American
leadership globally
• Addressing the responsible use of AI in healthcare
and other sectors
• Strengthening international collaborations on AI
safety and standards
• Ensuring responsible and effective government
use of AI in public services and infrastructure
• Within 90 days, a task force will be established to develop a strategic plan for AI deployment in
healthcare, including research, drug/device safety, and public health
• Within 180 days, HHS must develop a strategy to ensure AI technologies in healthcare maintain
appropriate levels of quality, including pre-market assessment and post-market oversight
• Ensure healthcare providers receiving federal funding comply with nondiscrimination laws when
utilizing AI technology
• Establish a program to identify and address clinical errors resulting from AI in healthcare settings within
365 days
• Develop a strategy for appropriate regulation of AI in drug development, including potential rulemaking
and public-private partnerships
• Coordinate and launch National AI Research Resource (NAIRR) to support AI research and developments
• Establish a program to train new researchers in AI, with a goal of training 500 new researchers by 2025
• Fund and launch NSF Regional Innovation Engines focusing on AI-related work
• Establishment of New AI Research Institutes: Create at least four new National AI Research Institutes
within 540 days
• With the new executive order, AI advancements in the healthcare market may be limited, given that regulations are slow comparative to the pace of innovation
• Push federal legislation for data protections will significantly impact healthcare and biotechnology, may lead to development of more comprehensive legal frameworks
• Further focus on responsible AI use in healthcare, particularly in drug development, to reduce both errors and biases, especially against marginalized groups
• Engagement with industry groups for a safe and appropriate AI regulatory framework, indicates a broader industry movement towards responsible AI utilization
• Efforts to balance protecting public safety and privacy without hindering innovation, crucial for advancement without compromising ethics and personal data security
• Future AI governance, with long-term impacts evolving, considerations around AI's global nature and potential for development move to less regulated regions
• Establish a foundation for future AI advancements in healthcare, marking a big step towards integrating AI more effectively in healthcare practices and policies

25
Biden's AI Executive Order
AI
Streamlined
administration
processes
Significant Cost
Reductions
Improved diagnostic
accuracy and efficiency
42.4% CAGR over
next decade
Increased digital and
HCIT spend
Top investment
priority for ~1/3 HCIT
• A survey of healthcare provider
executives indicated an average increase
of 18.3% in digital and IT budgets from
2019 to 2023, with one in five reporting
increases of more than 30%
• The allocation for artificial intelligence
and machine learning in the healthcare
sector is expected to reach 10.5% by
2024, up from 5.5% in 2022.
• Recent research suggests that current AI
technology could decrease annual
healthcare spending by 10%, amounting
to savings of around $360 billion
• AI could be used to help combat rising
labor costs, burnout, and staffing
difficulties for hospitals, care facilities,
and other forms of inpatient care
Improvements to care, financial performance, and
workforce satisfaction
Promise for future investments to enhance
offerings and streamline efficiency
Commentary

26
Table Of
Contents Healthcare
I. Current Market 5
II. Eli Lilly 12
III. CRISPR 17
V. M&A Deal 24

27
Danaher Deal overview
• Danaher (NYSE: DHR) is a multinational conglomerate known for its diverse portfolio of science and technology solutions
• Danaher agreed to buy Abcam (NASDAQ: ABCM) for $5.7 billion in all-cash, including debt (proceeds from the issuance on
commercial paper) to help Danaher map complex diseases and accelerate drug discovery
• Danaher's products and services are utilized in a wide range of applications, contributing to advancements in healthcare,
research, and industrial processes. Its business segments are biotechnology, life sciences, diagnostics, and environmental
and applied solutions
• Abcam is a British biotech firm that manufactures protein consumables and supplies life science research tools. The Abcam
Board of Directors unanimously approved and recommended the transaction to be a standalone operating company within
Danaher's Life Sciences segment
• The acquisition represented a 2.7% premium to Abcam’s $24 stock price as of the day before the announcement
• Danaher will add to its 5,500-person workforce in the U.K., committing to keeping Abcam’s headquarters within the country
• Jonathan Milner, the founder of Abcam, opposed the acquisition in October, believing that the $24 per share offer
undervalued the company
Acquisition Details
Valuation (LTM)
EV/Rev EV/EBITDA P/E
x x x
Danaher 6.6x 21.2x 26.6x
Abcam 12.4x 46.1x 50.1x
Financials (LTM)
Revenue EBITDA FCF
($M) ($M) ($M)
Danaher $29,566 $9,204 $6,776
Abcam $457 $124 $11

28
Danaher Discounted Cash Flow Analysis – Forecasts and Outlook
Sources: FactSet

29
Danaher Notes and Growth Drivers
GrowthDrivers
• Danaher completed the spinoff of its environmental and
applied solutions branch (EAS) in 2022, will contribute to major
growth
• Veralto Enterprise System: This system, derived from the
successful Danaher Business System (DBS), is expected to drive
growth and efficiency in Veralto, replicating Danaher's growth-via-
acquisition strategy, as well as Abcam acquisition
• Financial Forecast Adjustments: Danaher anticipates a low-single-
digit percentage decrease in non-GAAP base business core
revenue for Q4
• Consequently, the company has revised its revenue and
earnings estimates to $6.7 billion and $2.00 per share, respectively
• Despite lower revenues and earnings, Danaher's shares
have maintained investor confidence
DCFCommentary
• Projections for the next 6 years are from street consensus
• The implied share price sits at $215.65, with the current share
price at $221.30
• The company had a major increase in revenue growth from 2019A
to 2020A due to the biotechnology arm tied to COVID-19, as
vaccine production skyrocketed
• Revenue growth projected to be negative for 2023E and 2024E due
to the separation of Veralto and decrease in vaccine products,
however projections after for the next few years average to 9% from
the acquisition with abcam
• EBIT maintains a steady growth, meaning that
predictions on company profitability is positive, showing the
potential benefits of the acquisition

30
Danaher's Weighted Average Cost of Capital (WACC Analysis)
• WACC Analysis is the discount rate used in the DCF
analysis, showing the return that lenders and
shareholders expect to receive forproviding capital. The
WACC, of 8.85% is relatively elevated, but not
unreasonable
• The WACC is used in present value and terminal
value of the DCF
o Calculation: % of equity * Cost of Equity + (%
of Debt * Cost of Debt * (1- Tax Rate)
• Cost of Equity: Rate of return on an investment;
calculated using the CAPM
o Calculation: Risk Free Rate (RFR) + Beta * Market
Risk Premium
• Beta: Measure of volatility of Danaher's stock relative to
the broader market (ex: S&P 500). Since Danaher's beta
is 1, it is neutral and in par with the market
Commentary
Sources: FactSet

31
Table Of
Contents Healthcare
I. Current Market 5
II. Eli Lilly 12
III. CRISPR 17
V. M&A Deal 24

32
Brystol Myers Squibb Acquisition of Karuna Theraputics overview
• Bristol Myers Squibb (NYSE: BMY) is biopharmaceutical company develop
and deliver innovative medicines that help patients prevail over serious
diseases
• Karuna Therapeutics is a biopharmaceutical company focused on developing
innovative therapies for neuropsychiatric disorders. Their research and
development efforts primarily target conditions such as schizophrenia and
Alzheimer's disease
• Bristol Myers Squibb (BMS) agreed to buy Karuna Therapeutics (NASDAQ:
KRTX) for $14 billion in all-cash, including Karuna’s $1.3 billion of cash
• BMS agreed to pay $330 per share in cash, a 53% premium to Karuna’s $215
stock price as of December 21st
• BMS will lose around 60% of their existing drugs due to expired patents over
the next decade
Acquisition Details
Comps
Market (M) Financials ($M)
Price Mkt Cap EV Revenue EBIT NI
Karuna $317.9 $13,439 $12,097 $5.9 ($450.2) ($396.0)
Cerevel $41.9 $8,057 $7,717 - ($414.9) ($393.0)
Intra-Cellular $70.4 $7,080 $6,585 $420.1 ($172.7) ($284.1)
Neurocrine $128.5 $13,713 $12,617 $1,783.9 $349.6 $191.0
ACADIA $31.4 $5,328 $4,982 $631.9 ($154.4) ($148.8)
Anavex $8.9 $779 $628 - ($55.8) ($47.5)
Risks
• KarXT, Karuna’s star schizophrenia drug, is still awaiting FDA approval
• Karuna has had negative free cash flow into the millions for the past 6 years
Benefits
• If KarXT is approved by the expected date of September 26, 2024, drug sales
could increase by $6 billion for the following year
• The drug could also benefit BMS’s Alzheimer’s and bipolar disorder research

33
Illumina – Grail Divestiture
Struggling Spinoff – Operating Profit by Segment ($m) Illumina’s Tumbling Performance
Deal Timeline
January 2016
Illumina spins off
Grail as new company
December 2023
Illumina to divest
Grail through sale or
capital markets
September 2020
Illumina re-acquires
Grail for $7.1bn
July – August 2021
Deal faces full-scale
EU and FTC antitrust
probe
August 2021
Illumina completes
Grail deal
July 2022
Illumina loses
challenge in second-
highest European
court
July 2022
EU says Illumina will
face fines for
bypassing regulatory
authorities
September 2022
US Court rules in
favor of Illumina’s
challenge, FTC
appeals
January 2023
Illumina challenges
EU antitrust order to
keep Grail separate
March 2023
Carl Ichan launches
proxy fight at
Illumina, winning a
board seat in May
July 2023
EU fined record
$467m antitrust
penalty
October 2023
Ichan sues board for
violating fiduciary
duties
December 2023
US appeals court
strikes down FTC
order against
Illumina’s acquisition
$-
$100.00
$200.00
$300.00
$400.00
$500.00
$600.00
Dec 2018 Dec 2019 Dec 2020 Dec 2021 Dec 2022 Dec 2023
$(1,000.0)
$(500.0)
$-
$500.0
$1,000.0
2015 2016 2017 2018 2019 2020 2021
Illumina Grail & Others
Sources: WSJ, Reuters, SEC Filings

34
Cigna and Humana Merger Deal Call Off
Top Healthcare Insurance Companies Market Share
Combined Market Share:
$143.57bn
Background
• Cigna (NYSE: CI) announced plans to buy Humana (NYSE: HUM), another healthcare
insurance company in order to expand Cigna's business to Medicare Advantage plans for
older Americans in an all cash-and-stock transaction deal worth $140bn, making it one of
the biggest M&A deals in the healthcare space. Ifsuccessful, this would have made Cigna
a strong competitor to UnitedHealth Group and CVS Health
• The combined Cigna and Humana entity foregone a highly competitive combined
market share, which would have placed the combined company in the top 3 of the largest
based insurance companies
• Failed to uphold due to disagreements in financial terms and price. The healthcare
industry effected the deal overall, as the high interest rate environment coupled with
antitrust scrutiny in the industry, and are causes also to be taken into consideration
Sources: WSJ, Bloomberg

35
FutureOutlook of Cigna
A New Ballgame
Consolidation
& Economies
Shareholder
Value
Bolt-On
Acquisitions
Commentary
Planned
Repurchases
$11.3bn
• The failure of the Cigna-
Humana merger could be a
blessing in disguise for Cigna
shareholders
• The company announced plans
to up their planned share
repurchases by over $10b,
bringing the planned figure to
over $11bn
• In addition, the company has
announced plans to shift its
focus towards bolt-on
acquisitions rather than
massive conglomerate deals
• This means more cash available
for reinvestment into the
business, as well as more likely
available to shareholders in the
form of dividends
• Overall, while consolidation is
positive, cash and liquidity rule
in a high-rate environment

WSMM_Healthcare_November_Newsletter_V1.pdf

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