Joseph Gilliam's "A View of the Public Ophthalmology Market & Exit Trends" presented at OIS@AAO 2015

1. A View of the Public Ophthalmology
Market & Exit Trends

2. a
A View of the Public Markets & Exit Trends
Joe Gilliam, Managing Director
Healthcare Investment Banking
J.P. Morgan

3. This presentation does not constitute a commitment by any J.P. Morgan entity to underwrite, subscribe for or place any securities or to extend or arrange credit
or to provide any other services. This presentation is for discussion purposes only and is incomplete without reference to, and should be viewed solely in
conjunction with, the oral briefing provided by J.P. Morgan. Neither this presentation nor any of its contents may be disclosed or used for any other purpose
without the prior written consent of J.P. Morgan. Companies and individuals named are for illustrative purposes only. This information should be treated
confidentially.
IRS Circular 230 Disclosure: JPMorgan Chase & Co. and its affiliates do not provide tax advice. Accordingly, any discussion of U.S. tax matters
included herein (including any attachments) is not intended or written to be used, and cannot be used, in connection with the promotion, marketing
or recommendation by anyone not affiliated with JPMorgan Chase & Co. of any of the matters addressed herein or for the purpose of avoiding U.S.
tax-related penalties.

4. 4
Equity market overview
Fund flows including ETF ($bn)
S&P sector performance 2015YTD Market volatility 2015YTD
Q3’15 corporate earnings
12.8%
8.1%
4.7%
1.0%
(0.2%)
(2.0%)
(3.7%)
(6.8%)
(10.8%)
(12.3%)
(14.3%)
2.0%
Consumer Disc.
Info. Technology
Healthcare
Consumer Staples
Financials
Industrials
Telecom
Materials
Utilities
Energy
Transportation
S&P 500 5
10
15
20
25
30
35
40
45
Jan-15 Mar-15 Jun-15 Aug-15 Nov-15
VIX Volatility Index
Max 40.7 Aug 24
Min 12.0 Jul 17
YTD avg. 16.7
Last 14.7 Nov 6
Source: FactSet, Lipper, Bloomberg as of 11/06/15
$9
$58
$3
($56)
($51)
($3)
Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15
Historical fund flows ($bn)
2008-2012 ($140)
2013 $133
2014 $129
2015YTD ($107)
Avg. of last 4 weeks ($1)
37%
16%
47%
71%
7%
22%
Above Meet Below
Revenue EPS
S&P 500 companies reported: 440/500

5. 12.8%
8.1%
4.7%
1.0%
(0.2%)
(2.0%)
(3.7%)
(6.8%)
(10.8%)
(12.3%)
(14.3%)
2.0%
Consumer Disc.
Info. Technology
Healthcare
Consumer Staples
Financials
Industrials
Telecom
Materials
Utilities
Energy
Transportation
S&P 500
S&P sector performance 2015YTD
Source: FactSet as of 11/06/15
5

6. Market volatility 2015YTD
5
10
15
20
25
30
35
40
45
Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Oct-15 Nov-15
VIX Volatility Index
Max 40.7 Aug 24
Min 12.0 Jul 17
YTD avg. 16.7
Last 14.7 Nov 6
Source: FactSet, Bloomberg as of 11/06/15
6

7. $9
$58
$3
($56)
($51)
($3)
Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15
Fund flows including ETF ($bn)
Source: Lipper as of 11/06/15
Historical fund flows ($bn)
2008-2012 ($140)
2013 $133
2014 $129
2015YTD ($107)
Avg. of last 4 weeks ($1)
7

8. 37%
16%
47%
71%
7%
22%
Above Meet Below
S&P 500 companies reported: 440/500
Revenue EPS
Q3’15 corporate earnings
Source: Bloomberg as of 11/06/15
8

9. 7
5x
10x
15x
20x
25x
30x
1995 1999 2002 2005 2008 2012 2015
(4.4%)
5.0%
8.3%
12.7%
4.5%
9.6%
Q3'15 Q4'15 Q1'16 Q2'16 FY 2015FY 2016
Equity market outlook
Bulls
S&P 500 1-year forward P/E
16x
 Positive outlook for U.S. labor & growth
 Inflation remains modest
 Fed stance remains accommodative
 Corporate earnings growth persists
 Volatility in the broader markets subsides
 Potential Fed tightening first time in 10 years
 Uncertainty in China market persists
 Commodity market volatility
 Global growth concerns
 Geopolitical risks
Bears
J.P. Morgan forecasts a 2,150 S&P 500 year-end price target, 4% above current levels
Source: FactSet and Morgan Markets
Note: EPS for S&P 500 calculated as the index weighted consensus estimate of EPS based on individual securities’ standard market convention for EPS
(US GAAP or Adjusted)
S&P 500 consensus EPS estimates YoY%
chg

10. 8
50%
100%
150%
200%
250%
300%
350%
400%
2010 2011 2012 2013 2014 2015
5-year stock price performance
113%
205%
Biotech and medtech trading performance
Source: FactSet as of 10/27/15
1 AMEX Biotechnology Index
2 Medtech index consists of medical technology companies traded on North American exchanges with market capitalizations over $500mm
75%
Returns summary
5 yr 2 yr YTD
Medtech2
31%
Biotech1
63%
S&P 500
17%
3%
4%
0%

11. 9
75%
100%
125%
150%
175%
200%
225%
10/27/2013 3/22/2014 8/15/2014 1/8/2015 6/3/2015 10/27/2015
2 year performance of ophthalmic sector participants
Relative stock price performance
+88% +17% +63% +13% +40%
Ophth1
53%
S&P 500
17%
Diversified
/ Ophth2
30%
Source: FactSet as of 10/27/15
1 Ophth index includes Aerie, Alimera, Avalanche, Cooper, Eleven, Glaukos, Inotek, Ocular, Ophthotech, QLT, Santen, Spark, STAAR and ThromboGenics
2 Diversified / Ophth includes Abbott, Allergan, Bayer, Merck, Novartis, Pfizer, Regeneron, Shire and Valeant
3 Return since June 2015 IPO
3

12. 10
Medtech M&A activity has remained strong while biopharma
M&A activity has picked up
M&A transactions
Source: Dealogic, EvaluatePharma, press releases, public filings
Note: Based on US targets only and excludes deals <$50mm
9
34 27 27 23 25 28
17
21
18
36
42
49 51
32 36
53 52
45 46
50 46
0
10
20
30
40
50
60
70
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Biopharma Medtech
2014 - 2015 ophthalmology M&A
July ‘15 $125mm + undisclosed contingent
August ‘15 $300mm
September ‘15 $300mm + undisclosed contingent
November ‘14 $66bn

13. 11
Biopharma lead the IPO market resurgence …
IPO activity, 2005 – 2015 YTD
Source: Dealogic
Note: Includes IPOs > $50mm
7
11 14
0 3
8
4
11
28
64
33
5
5 8
1 1
1
2 1 2
9 8
0
10
20
30
40
50
60
70
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Biopharma Medtech
$657 $389 $771 $2,699 $7,086 $4,106
$79 $285 $115 $224 $1,375 $788
Total proceeds raised, 2005 – 2015 YTD($mm)
$1,217
$199
$0
$51
$1,137
$1,259
$1,749
$665
$585
$429

14. 12
… however recent healthcare IPOs have seen mixed pricing
outcomes
Source: Dealogic, FactSet, Companing Filings for U.S. IPOs > $50mm
Pricing vs. filing range
50%
40%
20%
27%
60%
100%
67%
20%
80%
36%
33%
50%
33%
50%
40% 36%
67%
50%
40%
Above
Within
Below
44
%
30
%
40
%
35
%
16
%
35
%
2014 2015

15. 13
Ophthalmology IPO activity
2005 2007 2009 2013 2015
(withdrawn) (withdrawn)
09/24/13
$192 / $687
10/25/13
$67 / $228
04/21/10
$72 / $342
07/06/06
€35 / €103
2011
77 74
93
9
31
65 50 39
83
157
118
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
YTD
Healthcare IPOs priced / year (2005 to present)1
Source: Dealogic, FactSet, Company filings
1 Includes global healthcare IPOs >$15mm
Date priced / Size / Market value at IPO (in $ millions):
07/24/14
$75 / $267
07/30/14
$117 / $363
02/05/14
$57 / $154
06/24/15
$124 / $563
01/29/15
$185 / $540
02/17/15
$40 / $95

16. 14
Key success factors observed in recent lifesciences IPOs
Valuable lead product, sufficiently de-risked with significant market opportunity
and ownership retained
Products which also address cost to the system vs. efficacy
Strong management teams led by CEOs with prior public market success
Crossover investors to provide validation as well as support on IPO and in
aftermarket
Near-term data / strategic catalysts to answer the “why buy now” question
Extensive interaction with public investors 6 months to 1 year before IPO org
meeting
Critical to price appropriately for existing market to ensure strong deal and
aftermarket performance (prudent / attractive cover valuation range)
Potential for competitive M&A takeout
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