Healthcare It Industry Update │ Q3 2016

HEALTHCARE IT INDUSTRY UPDATE │ Q3 2016

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0 HEALTHCARE IT INDUSTRY UPDATE | Q3 2016

HEALTHCARE IT PRACTICE OVERVIEW

CONTENTS INTRODUCTION . WHAT WE’RE READING Harris Williams & Co. is pleased to present our review of Q3 Healthcare IT . KEY HEALTHCARE MACRO activity. This report provides commentary and analysis on current capital market INDICATORS trends and merger and acquisition dynamics within the Healthcare IT industry. . PUBLIC MARKETS . PUBLIC COMPARABLES We hope you find this edition helpful and encourage you to contact us directly if . M&A ACTIVITY you would like to discuss our perspective on current industry trends and M&A . PRIVATE PLACEMENT ACTIVITY opportunities or our relevant industry experience. . IPO ACTIVITY

OUR PRACTICE CONTACTS Sam Hendler Harris Williams & Co. is a leading advisor to the Healthcare IT industry. Our global Managing Director practice includes professionals across the firm from Harris Williams & Co.’s [email protected] Technology, Media & Telecom Group and Healthcare & Life Sciences Group. +1 (617) 654-2117

Jeff Bistrong HW&Co. Healthcare IT Taxonomy Managing Director [email protected] +1 (617) 654-2102 . Patient-Facing Solutions Mike Wilkins . Care Delivery: Managing Director Operational Efficiency [email protected] +1 (415) 271-3411 . Care Delivery: Clinical / Acute Thierry Monjauze Managing Director . Care Delivery: [email protected] Clinical / Non-Acute +44 20 7518 8901 CARE DELIVERY EMPLOYERS ORGANIZATIONS PATIENTS . Care Delivery: Turner Bedrup Clinical / Post-Acute Managing Director INSURERS CLINICIANS [email protected] . Pharma & Devices +1 (804) 915-0110

. Revenue Cycle Cheairs Porter Management Managing Director [email protected] . Population Health & Risk +1 (804) 915-0130 Management James Clark Managing Director [email protected] HW&CO. Healthcare IT Market Map +1 (804) 915-0119 Please contact HW&Co. for proprietary detailed HCIT market map Geoffrey Smith Managing Director [email protected] +1 (804) 915-0195

Dan Linsalata Vice President [email protected] +1 (617) 654-2122

www.harriswilliams.com www.harriswilliams.com

PAGE | 1 HEALTHCARE IT INDUSTRY UPDATE | Q3 2016 WHAT WE’RE READING

UBER, CIRCULATION COLLABORATE ON HOSPITAL PILOT PROGRAM FOR PATIENT TRANSPORTATION

Healthcare Informatics 9/28/2016 Boston-based startup Circulation, as Uber’s preferred healthcare platform partner, is launching a digital healthcare transportation platform as a pilot program at several East Coast acute care and children’s hospitals. The pilot program is designed to reduce the number of missed doctor’s appointments by providing on-demand transportation options to get patients, especially disabled, elderly or low-income patients, to and from medical appointments. Read the full article here.

CLINICAL HEALTH APPS OUTPACING FITNESS TRACKERS AMONG INVESTORS AND INNOVATORS

Healthcare IT News 9/27/2016 New research determined that health apps and devices with a clinical focus are more likely to grow in popularity this year than consumer-focused products. “Investment trends in digital health are shifting from consumer wellness applications to clinically driven solutions that drive better health outcomes at lower costs,” the report said. “This next wave focuses on encouraging consumers and patients to change health-related behaviors...” Read the full article here.

WASHINGTON DEBRIEF: HOUSE COMMITTEE LEADERS PLEDGE HEIGHTENED ATTENTION TO HEALTH IT IN 2017

Healthcare Informatics 9/19/2016 A key House Committee held a hearing [in September] to explore how healthcare technology can create efficiencies in care delivery, improve outcomes and reduce cost.

Read the full article here.

HHS GIVES $87 MILLION TO BOOST HEALTH CENTER IT

Healthcare IT News 9/15/2016 More than 1,300 health centers across the U.S. and its territories will be given $87 million for information technology enhancements. The money is meant to to support health IT enhancements aimed at speeding these providers' shift toward value-based care, through better data exchange, clinical decision support, patient engagement and more, according to HHS. Read the full article here.

CMS: PROVIDERS CHOOSE PACE FOR QUALITY PAYMENT PROGRAM IN 2017

EHRIntelligence 9/9/2016 In advance of the final rule for the Quality Payment Program — comprising both the Merit-based Incentive Payment System (MIPS) and Alternative Payment Models (APMs) — the CMS has relaxed demands on eligible providers in 2017. "In recognition of the wide diversity of physician practices, we intend for the Quality Payment Program to allow physicians to pick their pace of participation for the first performance period that begins January 1, 2017." Read the full article here.

INSURANCE STARTUP OSCAR QUITS TWO MARKETS, RETHINKS OBAMACARE PLANS

Bloomberg 8/23/2016 Health insurance startup Oscar Insurance will reevaluate its approach to Obamacare after suffering significant losses under the U.S. program and will pull out of two markets next year. “The individual market isn’t working as intended and there are weaknesses in the way it’s been set up,” CEO Mario Schlosser said in an interview. “We want to focus on the markets we understand well, we want to focus on the markets where we have our own model in place. Read the full article here.

PAGE | 2 HEALTHCARE IT INDUSTRY UPDATE | Q3 2016

KEY HEALTHCARE MACRO INDICATORS

U.S. HEALTHCARE SPENDING U.S. AGING POPULATION

($ in trillions) (percent age 65 and older)

$6.0 National Health Expenditures 20.0% HC Expediture as % of GDP 20.0% 20.2% $5.0 19.3% 19.0% $4.0 16.1% $3.0 18.0%

$2.0 13.0% 17.0% 12.6% 12.4% $1.0

- 16.0% '08 '10 '12 '14 '16P '18P '20P '22P '24P 1990 2000 2010 2020P 2030P 2040P 2050P

HIGH-DEDUCTIBLE HEALTH PLAN ENROLLMENT PRIMARY CARE SUPPLY

(enrolled lives in millions) (number of physicians in thousands)

Total Physicians (in 000s) % Independent 19.7 821 17.4 794 723 15.5 683 13.5 11.4 10.0 57% 8.0 49% 6.1 4.5 37% 3.2 33%

'06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '00 '05 '13 '16E

U.S. EMR ADOPTION - HOSPITAL U.S. EMR ADOPTION - AMBULATORY

(percent adoption by EMRAM stage) (percent adoption by EMRAM stage)

Stage 0 Stage 1 Stage 2 Stage 3 Stage 0 Stage 1 Stage 2 Stage 3 Stage 4 Stage 5 Stage 6 Stage 7 Stage 4 Stage 5 Stage 6 Stage 7

'07 '08 '09 '10 '11 '12 '13 '14 '15 '12 '13* '14 '15

*represents Q1 2014 data (2013 year-end data unavailable)

PAGE | 3 HEALTHCARE IT INDUSTRY UPDATE | Q3 2016

PUBLIC MARKETS

MEDIAN REVENUE GROWTH (2012 – 2015) MEDIAN REVENUE GROWTH (2015 – 2016E)

Clinical / Administrative 14.0% Clinical / Administrative 13.6%

Payer-Focused 6.7% Payer-Focused 6.4%

Pharma 17.6% Pharma 4.1%

Consumer Healthcare 31.3% Consumer Healthcare 27.1%

Euro HCIT 10.4% Euro HCIT 4.4%

MEDIAN EBITDA MARGIN (2016E) MEDIAN EBITDA GROWTH (2015 – 2016E)

Clinical / Administrative 23.5% Clinical / Administrative 14.0%

Payer-Focused 30.8% Payer-Focused 15.3%

Pharma 24.8% Pharma 18.9%

Consumer Healthcare 36.4% Consumer Healthcare 12.6%

Euro HCIT 25.3% Euro HCIT 9.3%

MEDIAN CAPEX / REVENUE (2016E) MEDIAN TEV / 2016E EBITDA

Clinical / Administrative 5.0% Clinical / Administrative 12.7x

Payer-Focused 2.9% Payer-Focused 15.0x

Pharma 3.3% Pharma 21.0x

Consumer Healthcare 4.7% Consumer Healthcare 14.1x

Euro HCIT 3.7% Euro HCIT 12.1x

HISTORICAL STOCK PERFORMANCE (SEPTEMBER 30, 2011 – SEPTEMBER 30, 2016)

500 450 400 350 300 250 200 150 100 50 0

Clinical & Administrative Payer-Focused Pharma Consumer Healthcare Euro HCIT S&P 500

PAGE | 4 HEALTHCARE IT INDUSTRY UPDATE | Q3 2016

PUBLIC COMPARABLES

VALUATION AND OPERATING METRICS

As of September 30, 2016 ($ in Millions, except per share amounts)

Stock Performance Current% of LTM TEV / EBITDA Mkt Cap TEV Price LTM High Revenue % Growth EBITDA Margin LTM 2016 Clinical / Administrative EMR Cerner Corporation $20,762 $20,717$61.4890.0%$4,65719.8%$1,43430.8%14.4x12.7x athenahealth, Inc. 4,8144,975122.3771.8%1,01221.2% 139 13.7%35.8x21.1x Allscripts Healthcare Solutions, Inc. 2,4293,91413.0282.5%1,4324.3% 219 15.3%17.9x13.5x Quality Systems, Inc. 695 752 11.3064.6% 493 (0.4%) 76 15.4% 9.9x8.8x Computer Programs and Systems, Inc. 350 501 25.8643.7% 227 17.6% 36 15.9%13.9x8.8x Median $2,429$3,914 71.8%$1,01217.6% $139 15.4%14.4x12.7x RCM / Performance Nuance Communications, Inc. $3,946$5,792$14.1164.7%$1,9470.2% $394 20.2%14.7x8.3x Premier Inc. 1,4944,38431.5283.9%1,1636.6% 354 30.5%12.4x9.4x Advisory Board Company 1,7282,27942.9278.3% 803 4.5% 222 27.6%10.3x11.8x Evolent Health Inc 1,0141,11022.7184.6% 192 98.6% (46) NMNMNM Median $1,611$3,331 81.1% $983 5.5% $288 27.6%12.4x9.4x Other Administrative Omnicell, Inc. $1,363$1,547$37.6893.0% $599 23.7% $76 12.6%20.5x14.2x HealthStream, Inc. 837 698 26.3793.6% 219 4.6% 31 14.1%22.6x20.1x Vocera Communications, Inc. 455 337 16.8498.7% 113 8.3% (11) NMNMNM Tabula Rasa Healthcare, Inc. NA NA NA NA 80 NA 10 12.2% NMNM Median $837$698 93.6% $166 8.3% $20 12.6%21.6x17.1x Clinical / Administrative Median $1,428$1,913 83.2% $599 7.5% $76 15.4%14.6x12.3x

Payer-Focused Inovalon Holdings, Inc. $2,434$1,964$15.9466.8% $453 3.5% $117 25.9%16.8x14.6x HMS Holdings Corp. 1,8861,89622.3393.0% 490 3.4% 109 22.3%17.3x15.3x Cotiviti Holdings, Inc. 2,7123,46330.0887.5% NANA NANMNM 14.4x Payer-Focused Median $2,434$1,964 87.5% $471 3.4% $113 24.1%17.0x14.6x

Pharma Quintiles Transnational Holdings, Inc. $9,211 $10,890$77.3898.1%$5,9984.4% $864 14.4%12.6x12.4x Veeva Systems Inc 5,4654,98640.1394.2% 472 23.7% 94 20.0%52.8x34.3x PAREXEL International Corporation 3,6033,85567.7492.5%2,4292.3% 365 15.0%10.6x10.0x Medidata Solutions, Inc. 3,1833,12155.3798.4% 421 7.2% 51 12.1%61.2x29.6x Pharma Median $4,534$4,421 96.2%$1,4505.8% $230 14.7%32.7x21.0x

Consumer Healthcare WEX Inc. $4,455 $5,407 $104.28 98.5% $879 2.8% $303 34.5% 17.9x 14.1x WebMD Health Corp. 1,911 1,935 49.02 72.6% 671 5.4% 176 26.2% 11.0x 8.5x HealthEquity Inc 2,048 1,899 34.93 97.6% 155 33.6% 48 30.9% 39.8x 31.5x Benefitfocus, Inc. 1,154 1,161 38.91 86.5% 212 14.7% (34) NM NM NM Castlight Health, Inc. 448 322 4.36 79.0% 87 15.7% (72) NM NM NM Connecture Inc. 39 55 1.74 27.8% 88 (8.1%) (3) NM NM NM Consumer Healthcare Median $1,532 $1,530 82.7% $184 10.1% $22 30.9% 17.9x 14.1x

Euro HCIT CompuGroup Medical SE $2,382 $2,750 $44.75 97.9% $603 0.1% $121 20.1% 22.7x 19.3x EMIS Group plc 819 819 12.94 71.9% NA NA NA NM NM 12.1x NEXUS AG 324 293 20.58 93.9% 113 4.9% 21 18.7% 13.9x 11.8x Euro HCIT Median $819 $819 93.9% $358 2.5% $71 19.4% 18.3x 12.1x

Consolidated Median $1,898 $1,950 87.0% $490 5.2% $94 19.3% 16.8x 13.5x

PAGE | 5 HEALTHCARE IT INDUSTRY UPDATE | Q3 2016

M&A TRANSACTION ACTIVITY

Last 12 Months as of September 30, 2016 ($ in Millions)

Announced Enterpise Implied Implied Date Target Acquirer Business Description Value EV/Revenue EV/EBITDA

Convey Health Solutions, 10/06/16 New Mountain Capital Provider of health insurance support services. * * * Inc.

10/04/16 Emmi Solutions LLC Wolters Kluwer NV Provider of medical information through media platforms. $170.0 5.9x *

Provider of software application platforms and 09/22/16 Creehan & Co. Corp. Inovalon Holdings, Inc. $130.0 4.8x * implementation of services.

Anthelio Healthcare Provider of IT, health information management, EHR, and 09/12/16 ATOS SE $275.0 1.4x * Solutions, Inc. analytics solutions to healthcare organizations.

Provider of dental computer aided design, scanning 09/11/16 exocad GmbH The Carlyle Group * * * software, dental CAM, and dentalshare solutions.

Provider of technology enabled clinical trial 08/22/16 BioClinica, Inc. Cinven Group Ltd. $1,400.0 5.6x 14.0x management services.

Provider of patient-experience measurement and 08/09/16 Press Ganey Holdings, Inc. EQT Partners AB $2,284.5 6.6x 21.4x performance analytics solutions.

07/21/16 Connected Benefits GoHealth, LLC Provider of employee benefits management software. * * *

Provider of population health management and data 07/20/16 Wellcentive, Inc. Royal Philips NV * * * analytics solutions.

Provider of HCIT authentication management security 07/13/16 Imprivata, Inc. Thoma Bravo LLC $442.5 3.5x NA solutions.

07/13/16 Valence Health, Inc. Evolent Health, Inc. Provider of health system solutions. $145.0 2.0x 10.0x

Provider of mobile patient engagement solutions to 06/30/16 HY Holdings, Inc. Teladoc, Inc. $155.8 * * employers.

Provider of revenue cycle management solutions to 06/15/16 Navicure, Inc. Bain Capital LP * * * physicians, billing companies, and hospitals.

Provider of quality and compliance solutions for health 06/13/16 MedHOK, Inc. The Hearst Corporation * * * plans and accountable care organizations.

Cardon Healthcare Provider of third party eligibility and revenue cycle 06/13/16 MEDNAX, Inc. * * * Holdings LLC management services for hospitals.

Provider of EMR, practice management, and revenue 05/04/16 DocuTAP, Inc. Warburg Pincus LLC * * * cycle management software for urgent care.

Quintiles Transnational Provider of information and analytics solutions to the 05/03/16 IMS Health Holdings, Inc. $12,912.1 4.2x 17.1x Holdings Inc. pharmaceutical and healthcare industries.

Provider of digital health and wellness smart devices and 04/26/16 Withings SA Nokia Corporation $191.6 * * applications.

Provider of risk assessment and decision analytics 04/25/16 Verisk Health, Inc. Veritas Capital $820.0 * * services to the global healthcare industry.

Curaspan Health Group, Provider of discharge and care transition solutions for 04/14/16 Cardinal Health, Inc. * * * Inc. coordinated care.

Netsmart Technologies, GI Partners; Allscripts Provider of SaaS-based enterprise software solutions 03/23/16 $950.0 * * Inc. Healthcare Solutions, Inc. supportingintegrated, coordinated care delivery.

Provider of cloud-based business process management 02/22/16 Brightree LLC Resmed Corp. $800.0 8.3x * software to the post-acute care industry.

Truven Health Analytics, International Business Provider of analytic solutions and services for healthcare 02/18/16 $2,600.0 * * Inc. Machines Corp. industry.

Provider of real-time location systems to healthcare 02/05/16 CenTrak, Inc. Halma Plc $140.0 3.2x * facilities.

*HW&Co. confidential transaction *Unpublished information

PAGE | 6 HEALTHCARE IT INDUSTRY UPDATE | Q3 2016

M&A TRANSACTION ACTIVITY

Last 12 Months as of September 30, 2016 ($ in Millions)

Announced Enterpise Implied Implied Date Target Acquirer Business Description Value EV/Revenue EV/EBITDA

Provider of primary research-based insights and analytics 02/03/16 AlphaimpactRX, Inc. IMS Health Holdings, Inc. * * * to healthcare and life sciences organizations.

Provider of online medically-reviewed health and 01/11/16 Healthline Media Summit Partners LLP * * * wellness information for consumers.

Provider of recovery services to insurance and 12/18/15 Trover Solutions, Inc. New Mountain Capital * * * healthcare companies.

Provider of reimbursement analysis and payment integrity 12/18/15 Equian LLC New Mountain Capital $225.0 2.6x * solutions.

Provider of behavior-based prescription management 12/04/15 PDR Network LLC PSKW, LLC * * * programs to the healthcare industry.

Silverlink Communications Provider of consumer health engagement programs to 12/03/15 Welltok, Inc. * * * LLC educate and support healthcare consumers.

Computer Programs & Provider of healthcare information systems for rural and 11/25/15 Healthland, Inc. $250.0 * * Systems, Inc. critical access hospitals.

Pamplona Capital Provider of technology-enabled performance 11/02/15 MedAssets, Inc. $2,656.3 3.5x 12.2x Management improvement solutions for providers and payers.

Provider of web-enabled computing software products 10/30/15 HealthFusion, Inc. Quality Systems, Inc. $190.0 * * and communications services to health care providers.

Provider of pharmacy automation and information 10/29/15 Aesynt, Inc. Omnicell, Inc. $275.0 1.5x 13.8x management solutions for hospitals and health systems.

Provider of cloud-based clinical connectivity and 10/26/15 Atlas Medical Software Roper Technologies, Inc. $48.0 * * process integration solutions.

Provider of clinical laboratory information management 10/26/15 Clinisys Group Ltd. Roper Technologies, Inc. $261.0 * * software solutions (d.b.a. CliniSys).

NextGen, Hospital Solutions QuadraMed Affinity Provider of hospital information systems (formerly Hospital 10/22/15 * * * Division Corporation Division, NextGen Healthcare Information Systems).

Provider of SaaS-based financial management system for 10/15/15 Benaissance LLC WEX, Inc. $80.0 6.0x * health benefits administration.

Provider of SaaS-based private benefits exchange and 10/01/15 Empowered Benefits Inc. Aflac, Inc. * * * benefits administration solutions.

*HW&Co. confidential transaction *Unpublished information

PAGE | 7 HEALTHCARE IT INDUSTRY UPDATE | Q3 2016

PRIVATE PLACEMENT ACTIVITY

Last 12 Months as of September 30, 2016 ($ in Millions)

Announced Round / Money Raised to Date Target Lead Investor(s) Business Description Stage Raised Date

Azalea Health Innovations, Provider of an electronic health records system for 09/27/16 Undisclosed Investors C $10.8 $22.8 Inc. medical practices.

Carrick Capital Partners Provider of a payments network for the healthcare Late-Stage 09/26/16 InstaMed Holdings, Inc. $50.0 $112.3 LLC industry. VC

Lewis & Clark Venture Provider of hosted core infrastructure required to build 09/21/16 Catalyze, Inc. B $6.5 $31.1 Capital modern apps for health and wellness.

Health Enterprise Partners; Provider of data, analytic and mobile solutions for the 08/30/16 Shyft Analytics, Inc. B $12.5 $31.5 Milestone Venture Partners global life sciences industry.

Twin Focus Equity Partners Provider of online weight loss and related disease 08/30/16 Zillion Group, Inc. C $28.0 $32.1 LLC prevention programs. Provider of Web and mobile platform for administration of 08/24/16 ClearCare, Inc. Battery Ventures home-care agencies. D $60.0 $75.6

AH Capital Management; Provider of consumer healthcare information services. Late-Stage 08/11/16 Accolade, Inc. $70.0 $142.2 Madrona Venture Group VC

Wound Technology Aldrich Capital Partners Provider of a telehealth based platform that offers 08/09/16 A $40.0 $40.0 Network, Inc. LLC wound care services. Provider of web-enabled diagnostic decision support 08/09/16 PreViser Corp. Undisclosed Investors tools for dentists and dental hygienists. D $2.0 $5.2

SV Life Sciences Advisers Provider of telemedicine and healthcare management 08/08/16 Aligned Telehealth, Inc. A $12.0 $12.0 LLP services.

Draper Fisher Jurvetson Provider of web-based electronic medical record 08/04/16 Elation EMR, Inc. B $15.0 $17.0 Management systems. Provider of teleradiology services for radiology groups 08/01/16 StatRad LLC Undisclosed and hospitals. NA $29.2 $29.2

Avalon Ventures; Provider of business management consulting and 07/21/16 AristaMD, Inc. A $11.0 $13.1 Correlation Management advisory services for the health care industry.

Provider of an open-source electronic health-record Late-Stage 07/15/16 Medsphere Systems Corp. Undisclosed $15.3 $53.5 system. VC Provider of a mobile/web-based communication and 07/13/16 Caremerge LLC GE Ventures coordination platform. B $14.0 $21.1

Bessemer Venture Partners, Provider of software and mobile applications for patient 07/13/16 Patient Steward, Inc. A $15.0 $17.1 NEA, Maverick Ventures record monitoring.

Blu Venture Investors; Provider of telemedicine solutions. 07/12/16 Avizia, Inc. A $11.0 $18.5 Middleland Capital

HCA Holdings, Inc.; Provider of data-driven technologies that improve 06/14/16 Procured, Inc. B $10.0 $15.1 Heritage Group LLC patient care.

Frist Cressey Ventures LLC; Provider of purchased services intelligence tools for 06/06/16 Valify LLC A $2.0 $2.8 Step 5 Capital healthcare organizations.

Sandbox RLD; Khosla Provider of predictive analytics around medical science 05/26/16 Lumiata, Inc. B $10.0 $20.0 Ventures; Intel Capital and patient data. Provider of cloud-based software for dental practice 05/12/16 Umbie Health Corp. Undisclosed Investors management. A $2.6 $2.8

Wellington Management Provider of a health and wellness engagement platform. 04/08/15 Sharecare, Inc. D $20.0 $34.0 Co. LLP

Bpifrance, Audacia SAS, Provider of digital communication and e-learning tools to 05/11/16 Groupe Interaction SAS NA $5.7 $5.7 Aquitaine Limousin Poitou the healthcare and pharmaceutical industries.

Point Judith, Longmeadow Provider of telehealth solutions connecting mental health 05/02/16 WeCounsel Solutions LLC A $3.5 $4.1 Capital Partners, CVH providers to their clients online.

PAGE | 8 HEALTHCARE IT INDUSTRY UPDATE | Q3 2016

PRIVATE PLACEMENT ACTIVITY

Last 12 Months as of September 30, 2016 ($ in Millions)

Announced Round / Money Raised to Date Target Lead Investor(s) Business Description Stage Raised Date

Provider of wearable digital wellness and medication Late-Stage 04/15/16 Proteus Digital Health, Inc. Undisclosed Investors $50.0 $419.7 adherence solutions. VC

Prolog Ventures, TEXO Provider of care coordination solutions for schools to Late-Stage 04/13/16 CareDox, Inc. $2.8 $10.7 Ventures manage and share medical information. VC

Provider of staff scheduling and labor management 04/13/16 OnShift, Inc. Health Velocity Capital D $18.0 $31.0 software solutions to the post-acute sector.

Merck, Cowen Pvt. Inv., Provider of consumer digital health and diabetes 04/12/16 Livongo Health, Inc. C $44.5 $84.5 Sapphire Ventures coaching tools.

GV (formerly Google Provider of cloud-based behavioral healthcare 04/14/16 Quartet Health, Inc. B $40.0 $47.0 Ventures) collaboration plaform.

Provider of cloud-based consumer shopping, enrollment, 03/11/16 Connecture, Inc. Francisco Partners PIPE NA $111.8 and retention platform for health plans.

Provider of cloud-based mobile healthcare platform for 02/25/16 Vivify Health, Inc. UPMC Health System B $2.0 $24.0 remote patient monitoring and virtual care.

Norwest Venture Partners, Provider of warehousing, analytics, and outcomes Late-Stage 02/29/16 Health Catalyst LLC $70.0 $222.0 UPMC Health System improvement solutions to healthcare organizations. VC

Babylon Healthcare Provider of a mobile appointment scheduling and clinical 01/15/16 Investment AB Kinnevik A $25.0 $25.0 Services Ltd. record access solution.

Provider of cloud-based intelligent clinical operating Late-Stage 01/12/16 NantHealth, LLC Return Investors $52.5 $764.5 systems for reducing administrative time and tasks. VC

Provider of precision medicine software solutions to 01/12/16 Syapse, Inc. Ascension Ventures C $25.0 $39.5 academic and community healthcare providers.

Provider of an online medical consultation platform to the 12/31/15 MonDocteur SAS Lagardere SCA NA NA $13.0 French healthcare market.

Samsung Ventures, Merck Provider of consumer-focused chronic disease 12/17/15 WellDoc, Inc. B $22.0 $47.7 Global Health Innovation management solutions.

12/07/15 Twine Health, Inc. Khosla Ventures Provider of cloud-based medical consultation software. A $6.8 $7.3

Provider of healthcare "gaming" and patient Late-Stage 12/07/15 Welltok, Inc. Return Investors NA $192.0 engagement solutions. VC

Provider of SaaS-based CRM and marketing automation 12/02/15 eVariant, Inc. The Goldman Sachs Group C $42.3 $68.6 software for hospitals and health systems.

Provider of personalized online brain-based health PE Growth / 11/12/15 HY Holdings, Inc. Frontier Capital NA $33.0 programs for employees. Expansion

Greylock Partners, Provider of behavioral health analytics and care 10/14/15 Lyra Health, Inc. A $35.0 $39.1 Venrock coordination software.

Provider of medication adherance, e-prescribing, and PE Growth / 10/14/15 DrFirst.com, Inc. The Goldman Sachs Group $25.0 $42.0 care coordination solutions. Expansion

PAGE | 9 HEALTHCARE IT INDUSTRY UPDATE | Q3 2016

IPO ACTIVITY

Last 18 Months as of September 30, 2016 ($ in Millions)

Enterprise Value Offer Date Issuer Description Raised Offer Date Today % Change

Provider of personalized medication therapy management and pharmacy 09/28/16 Tabula Rasa Healthcare, Inc. $59.3 $299.1 $271.2 (9.3%) services to reduce medication risk.

05/25/16 Cotiviti Holdings, Inc. Provider of analytics-driven healthcare payment accuracy solutions. $245.8 $2,414.3 $3,489.0 44.5%

06/04/15 Evolent Health, Inc. Provider of healthcare delivery and payment solutions in the United States. $224.8 $788.5 $1,153.5 46.3%

Provider of patient experience and caregiver performance measurement 05/20/15 Press Ganey Holdings, Inc. $255.9 $1,876.6 $2,297.7 22.4% and advisory solutions.

PAGE | 10 HEALTHCARE IT INDUSTRY UPDATE | Q3 2016

REPRESENTATIVE HW&CO. HEALTHCARE TECHNOLOGY TRANSACTIONS

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PAGE | 11 HEALTHCARE IT INDUSTRY UPDATE | Q3 2016

OUR FIRM

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PAGE | 12 HEALTHCARE IT INDUSTRY UPDATE | Q3 2016

HARRIS WILLIAMS & CO.

SOURCES

Accenture Healthcare IT News

America's Health Insurance Plans IMS Health

American Medical Association Medical Group Management Association

Bloomberg Modern Healthcare

Bureau of Economic Analysis Thomson Reuters

Bureau of Labor Statistics The Washington Post

Centers for Medicare & Medicaid Services U.S. Census Bureau

EHRIntelligence

FactSet

Federation of State Medical Boards

Healthcare Informatics

Healthcare Information and Management Systems Society

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