This is an updated version of the document published earlier today to incorporate takeaways from our Bull/Bear Lunch. No Need to Brace Yourself Clear Aligner Market Primer Life Science Tools & Diagnostics 21 October 2019 Equity Research Americas Erin Wright Research Analyst (212) 538-4080
[email protected] Katie Tryhane Haley Christofides Matthew Urbik Research Analyst Research Analyst Research Analyst (212) 325-2713 (212) 325-3720 (212) 325-2152
[email protected] [email protected] [email protected] DISCLOSURE APPENDIX AT THE BACK OF THIS REPORT CONTAINS IMPORTANT DISCLOSURES, ANALYST CERTIFICATIONS, LEGAL ENTITY DISCLOSURE AND THE STATUS OF NON-US ANALYSTS. US Disclosure: Credit Suisse does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the Firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision. Align Technology – Bull/Bear Scenarios Controversy Bull Case Bear Case Average Selling Price . Mix Shift to Accelerate Volume Growth: As ALGN . LT ASP Pressure: ASPs expected to continue to broadens its focus to a broader customer base, volume compress in 2019, with limited visibility on longer term What do ASP pressures mean for ALGN’s LT growth should offset an inherently compressed ASP; pricing power potential, with competitors in the wings revenue growth? Opportunity for non-price discount promotions Doctor-Directed Competition . Well Ahead of Competition: It is well ahead in terms . New Competitors: Doctors with established of innovation, with the ability to address an increasingly manufacturer relationships may opt to try out or fully How much of a concern are newer doctor-directed greater portion of a vastly underpenetrated market switch to newer doctor-directed product offerings product launches in the clear aligner market? DTC Competition .