Suzanne Foster of Medronic Advanced Energy reviews key challenges faced by Salient Surgical Technologies while being acquired by Medtronic Advanced Energy. Also discussed are overall trends for the medical device industry when it comes to sales, marketing, and innovation.

1. University of New Hampshire
September 27, 2012
Suzanne Foster, VP & General Manager

2. +
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2 | MDT Confidential

3. New Building
• Founded in 1999 with technology • Leadership transition „07
licensed from Medtronic
• Moved to new facility „08
• First product sold „01 into solid
organ resection • Turned EBITDA positive „09
• Entered ortho market in „02 • Treated 500,000th patient in „10
• Entered spine in „06 • Acquired August „11
3 | MDT Confidential

4. Aquamantys Has Treated
1,000,000 Patients
1,000,000th Patient
250,000
200,000
It took us 18 months
to treat our 500,000th
patient
150,000
It took us two
years to treat our
250,000th patient
100,000
It took us six
years to treat our
100,000th patient
50,000
0
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
4 | MDT Confidential

5. Peak Surgical
• Technology developed at Stanford in 1998
• PEAK Surgical, Inc. founded in May 2005
• Peak licensed IP from Stanford
5 | MDT Confidential

6. Peak Surgical Rapid Growth
Commercial Commercial  Integration
Release Success  Continued of PEAK
market into ST
 Focus on penetration  PEAK
growth  100,000 Global
 Clinical  Market Market
study cases/yr
 Series C penetration  $14M US Presence
completed  50,000
$23M  US sales revenue
Signet cases  MDT
distribution  $8M US
 Pre-clinical acquisition
 Strategic revenue
data
partnership
 510(k)
Medtronic
multiple
ENT PEAK
 R&D surgical Acquired
 CE Mark
 Series A & PlasmaBlade specialties
OUS sales
B $9M & generator  Mfg ramp-
 2009 $3.5M
Lehman, Ve  Market up
US revenue
nrock research
 Mgmt team
2006 2007 2008 2009 2010 2011 2012
08 6 | MDT Confidential

7. Medtronic, Inc.
• The Largest Medical
Device Company in the
World
• 120 countries
• 40,000 Employees
Worldwide
• $14 Billion WW Revenue
7 | MDT Confidential

8. 8 | MDT Confidential

9. The Aquamantys® System
 Transcollation technology
 Family of single-use sealers
BSC 9.1
6.0 2.3 Epidural Vein
Bipolar Bipolar MBS Sealer (EVS)
9 | MDT Confidential

10. Transcollation® Technology
Transcollation + Target Tissues = Hemostatic Seal
Soft Tissue:
Broad Tissue Planes
Solid Organs
• Delivers controlled thermal Bone
energy to target tissue
• Integrated saline and RF
energy
• Proprietary algorithm
controls power / saline
flow relationship
10 | MDT Confidential

11. Applications of
Transcollation® Technology
Total Hip Arthroplasty
Total Knee Arthroplasty
Spine Surgery
Orthopaedic Trauma
Surgical Oncology
11 | MDT Confidential

12. Continuity of Care: Plays to our Strengths
Advanced Energy
Primary
Pre-op Peri-op Post-op Discharge
Care
Focus?
Blood Management
12 | MDT Confidential

13. The PlasmaBlade Family
4.0 3.0S Needle PULSAR II
13 | MDT Confidential

14. PlasmaBlade Solution…
Single Instrument Surgery…
PlasmaBlade
− Precision cutting
− Minimal bleeding
− Less tissue damage
Less Energy Reduced Collateral Damage Improved Course
Less Heat Reduced Inflammatory Cell Count of Healing
14 | MDT Confidential

15. PlasmaBlade TPS Insulation
 TPS – Thermal Protection Shield
 1% pulsed RF plasma discharge along– 12.5 microns wide exposed
edge (~ width of human hair)
 By reducing the amount of active electrode surface area, the system
focuses and concentrates the energy to only the perimeter of the
active electrode.
15 | MDT Confidential

16. The Difference…
PlasmaBlade Technology Electrosurgical Pencil
Tissue Temperature Range: 40 – 170°C Tissue Temperature Range: 250 – 370° C
Scalpel PlasmaBlade Electrosurgery
16 | MDT Confidential

17. From Dr.Viktor Krebs
The Cleveland Clinic
Published March 16, 2011
For Internal Use Only 17 | MDT Confidential

18. Enforcement and Penalties
J&J - $81M & 5 Year CIA
AstraZeneca - $520M & 5 Year CIA
Pfizer - $2.3B & 5 Year CIA
GlaxoSmithKline - $3B
Medtronic - $40M & 5-Year CIA
Medtronic (Kyphon) - $75M & 5-Year CIA
Stryker Biotech
– Former President and 3 Sales Managers indicted for
false statements and fraudulent marketing. Possible
20 years and $250K fine.
Synthes
– Indictment and imprisonment of 4 senior executives
for off-label promotion
– filed 510(k) for general indication with the intent to
rely on physician research and publication to target
spine uses…BUT then promoted sine use w/out new
510k
18 | MDT Confidential

19. US Business Conduct Standards
• No gifts to customers, even for major life events
• No logo items to customers, for example: pens,
notepads, mugs, and “reminder items”
• Can provide occasional educational items and items
that benefit patients-must be less that $100 in value
unless the item is a textbook or anatomical model
• No customer entertainment or recreation
• No spouses or guests of customers (unless they are
qualified to attend in their own right)
19 | MDT Confidential