IPO Calendar Pre-IPO Ratings

Market
. Diabetes is the sixth leading casue of death by disease in the U.S.
. Blood glucose self-monitoring market is the largest medical self-test monitoring market
in the world…projected to grow from $3.5 billion in 2000 to $9 billion world-wide in 2005
. The U.S. market size in 2000 was $2 billion
. The current world-wide market is 90% controlled by four companies
Product
. THER’s product is called a ‘FreeStyle System’ kit that retails for a list price of $75
and includes a meter for reading test results, 10 lancets and 10 test strips
. The product is FDA cleared to be used on the thigh, upper arm & hand, and represents the
broadest array of off-finger sites cleared by the FDA
. A primary selling claim is that THER’s product is ‘painless’ relative to the competition
Distribution
. THER’s product is distributed in the U.S by nine of the ten largest retailers, including Walgreens,
Wal-Mart & CVS through wholesalers including McKesson, Cardinal Health & Bergen Brunswig
. THER’s product is in the process of being distributed in the Europe & Japan by the leading
distributors of insulin pumps…Disetronic in Europe & Nipro in Japan
. Diabetics who use insulin pumps are top prospects for the FreeStyle System
Direct to the consumer sales
. During the month of June end-users through telephone & web orders received $12.9 million
in product (all with a 30 day money-back guarantee), not recorded as sales until returns
are counted…we think only a small fraction were returned from June shipments
. On an annualized basis, June end-user gross sales were $155 million (not counting returns),
indicating a very healthy consumer product response
Competition
. Four companies control 90% of the worldwide market for blood glucose self-monitoring systems:
Roche Diagnostics, LifeScan (Johnson & Johnson), Bayer, MediSense (Abbot Labs)
CONTINUOUS GLUCOSE MONITORING SYSTEM
Two products from competing companies are approved by the FDA for continous monitoring
. A physician (not consumer product like Freestyle) product from MiniMed. MiniMed is in the
process of being acquired by Medtronic
. A prescription product from Cygnus, for adults over 18, which is not yet commercially viable
. A successful continuous glucose monitoring system could impact THER’s FreeStyle product
. THER is also developing a continuous glucose monitoring system
OTHER
. THER is 65% owned by venture capitalists pre-IPO
. THER has licenses but no patents, and is not currently involved in any litigation
. Use of proceeds: $50 million for sales & marketing, $10 million for R&D, $10 million for
manufacturing expansion, balance for working capital

IPO price change as of 10/26/01
Week of October 1
-38% Given Imaging 
GIVN, C
products for non-invasive analysis of the gastrointestinal tract
Yoqneam, Israel
1999 yr
2000 yr
June 6 mos
June Qtr Est
IPO Mrkt
Annual-
Revenue (mm)
0.0
0.0
0.0
0.0
Cap (mm)
ized rev.
Gross Profit %
0%
0%
0%
0%
301
multiple
Profit (loss)
-1.9
-7.5
-7.4
-4.00
@$12
n/a
Profit (loss) margin %
n/a
n/a
n/a
n/a
. R&D
2.2
4.1
2.6
. Marketing
0.1
2.9
4.3
. General & Admin
0.4
1.2
0.9
VALUATION RATIOS
Mrkt
Price /
Price /
Price /
Price /
% offered
Given Imaging (GIVN)
Cap (mm)
Sales
Earnings
BookValue
TangibleBV
in IPO
301
no sales
-19
3.8
3.9
20%
SCORECARD
Mgt
Market
Market Do-
Proprie-
Total
1-5, 5 is high
Growth
mination
tary
rating
20 is perfect
1
3
1
2
7
Management — no sales yet — 1
Market Growth — non-invasive analysis of the gastrointestinal tract — 3
Market Domination — no sales yet — 1
Proprietary — application of wireless & software technology to non-invasive analytical procedures — 2

Background
. Development stage (no sales) company incorporated in January, 1998
Product
The Given System
. Disposal imaging capsule that is swallowed by the patient at an out-patient clinic
. Wireless data is transmitted to a portable data recorder the patient carries during the next
seven hours
. Upon return of the portable data recorder, color imaging data is analyzed by proprietary software
on a computer workstation by the physician
Product focus
. Initial focus is on the analysis of the small intestinal tract
. Future gastgrointestinal tract diagnostic areas can include the esophagus,
the stomach and the colon (colonoscopy)
Installation & Payment Challenge
. GIVN’s expected profit is in the sale of disposable capsules
. Therefore, GIVN must widely install its computers & software, plus portable data recorders so that
it can sell disposable capsules (which transmit color images wirelessly to a portable data recorder)
Payment Challenge
. GIVN needs attract ‘early adopter’ physicians who can recommend the new approach
. GIVN also needs to convince third-party payors to pay, including government payors
such as Medicare and Medicaid, HMOs and other private insurers
Market
. The SMG Marketing Group estimates that more than one million procedures to examine
the small intestine will be performed in the U.S. in 2001 utilizing current diagnostic methods
. GIVN plans initially to sell in the U.S., Australia, New Zealand, Germany, France, Spain,
Portugal, Utaly& Belgium
FDA clearance
. In August 2001 GIVN received clearance from the FDA to market the Given System in the U.S.
as an additional tool (“adjunctive use”) in the detection of abnormalities of the small intestine
. GIVN will need to obtain additional FDA clearance before commercially distributing the Given
System for other intended users or for any other new products
Competition
. The current worldwide gastrointestinal endoscopy market is controlled by three companies:
Olympus, Asahi Optical (owner of the Pentax brand), and Fujinon
. GIVN is aware of R&D efforts by some of the above and other companies & individuals
to develo imaging capsules that may be competive to GIVN
Use of proceeds: inventory, R&D, manufacturing operations, capital expenditures, working capital

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