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CubiSafe: Cubist’s next growth storyAnagha MahajanSaurabh MalaniRyan DoyleNikhil Bhiwankar

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Agenda

Raison detre

Opportunity

Business Model

Value Creation

Value Delivery

Value Capture

Navigating uncertainties

Risk and mitigation

Conclusion

3

+Raison d'être: Saving lives

Saving lives

Core competency: Innovation and New

Product Development

Market leader in anti-bacterial

Differentiated culture

Raison detre

Opportunity

Business Model

Value Creation

Value Delivery

Value Capture

Navigating

uncertainties

Risk and mitigatio

n

Conclusion

4

+HAI: Disguised Opportunity 100,000 individuals killed every

year $45 billion in cost Antibiotic resistance is rising Pressing concern for Hospitals

$2 Billion in global revenue – majority from organic growth

Balanced and unique pipeline strategy

Leverage disciplined investments to generate $700mn in non-GAAP income

A highly differentiated Culture

Disciplined new business development

Unique pipeline for development –focus on anti-bacterial space

Investment in future technology

Promote innovative culture

Raison detre

Opportunity

Business Model

Value Creation

Value Delivery

Value Capture

Navigating

uncertainties

Risk and mitigatio

n

Conclusion

5

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Value Creation• Customer pain-points• Product Conception• Product Definition

Value Delivery• Channels• Marketing• Organizational

restructuring

Value Capture• Pricing• Creating sustainable

shareholder value

Opportunity realization

Raison detre

Opportunity

Business Model

Value Creation

Value Delivery

Value Capture

Navigating

uncertainties

Risk and mitigatio

n

Conclusion

+6

Value Creation: Pain-point

Human touch points – Thriving ground for bacteria colonies

Improbable to eradicate completely by routine cleaning

Causes health complications to existing patients and visitors

No change in current protocols and infrastructure, with a product that kills bacteria.

Raison detre

Opportunity

Business Model

Value Creation

Value Delivery

Value Capture

Navigating

uncertainties

Risk and mitigatio

n

Conclusion

7

+CubiSafe

No additional step

Seamless integration with existing products

Wider reach

No additional procurement of products

CubiSafe: An additive that can be incorporated in the paint, disinfectants and fabrics making them bacteria resistant.

Raison detre

Opportunity

Business Model

Value Creation

Value Delivery

Value Capture

Navigating

uncertainties

Risk and mitigatio

n

Conclusion

8

+Partnership v/s product strategy

Hedging risk of entering new market

Creating a hurdle for brand value dilution

REACH – Cannot manufacture various products but can reach all products with one solution – CubiSafe

Safety net for Cubist’s Pharma brand in case pilot is not successful in the new market

Raison detre

Opportunity

Business Model

Value Creation

Value Delivery

Value Capture

Navigating

uncertainties

Risk and mitigatio

n

Conclusion

9

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Delivery Medium- Paints Disinfectants Fabrics

Channel selection criteria Brand Image Access to end consumer Market Leadership Legal Agreement

Value Delivery

Raison detre

Opportunity

Business Model

Value Creation

Value Delivery

Value Capture

Navigating

uncertainties

Risk and mitigatio

n

Conclusion

CubiSafe Inside – A mark of safety and 100% guarantee

Think Intel Inside!!

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+Value Delivery Partnership with

OEM’s

Raison detre

Opportunity

Business Model

Value Creation

Value Delivery

Value Capture

Navigating

uncertainties

Risk and mitigatio

n

Conclusion

New marketing strategy

Cubist(owns

molecule)

Manufacturing Partner

Material Supplies

Procurement

OEMs (Customers

)

HospitalsProducts

with CubiSafe

Safer Hospital

Environment

SAVE LIVES

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+Go-to Market Strategy

Raison detre

Opportunity

Business Model

Value Creation

Value Delivery

Value Capture

Navigating

uncertainties

Risk and mitigatio

n

Conclusion

Research Hospitals

Investor owned for-profit

Not-for-profit Push strategy for KOL

Publish studies

Use partner sales channel to reach final customers

Create pull

Positioning: Pre-emptive bacteria free environment without altering the stakeholder behavior.

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+Value Capture: Pricing

Raison detre

Opportunity

Business Model

Value Creation

Value Delivery

Value Capture

Navigating

uncertainties

Risk and mitigatio

n

Conclusion

Partners

Spray Paint Linen

Avg. Price per can = $XPrice for Cubisafe Spray =$2.5X

Avg. cost per can = $XPrice for Cubisafe Paint = $1.66X

Revenue Split 50-50

Avg. cost of Linen per room = $XPrice for Cubisafe Linen per room = $1.5X

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+Financials

Raison detre

Opportunity

Business Model

Value Creation

Value Delivery

Value Capture

Navigating

uncertainties

Risk and mitigatio

n

Conclusion

(In $ Thousands) Year 1 Year 2 Year 3 Year 4 Year 5Revenue

Paint $1,500 $2,250 $3,750 $4,200 $4,500 Spray 13,500 20,250 33,750 37,800 40,500 Linen 7,500 11,250 18,750 21,000 22,500

Total Revenue 22,500 33,750 56,250 63,000 67,500

Cost of Goods Sold 1,350 2,025 3,375 3,780 4,050

Gross Margin 21,150 31,725 52,875 59,220 63,450

Research & Development 3,375 3,375 28,123 1,890 675 Selling, General and Admin. 4,500 6,750 12,398 15,750 18,900 Operating Expenses 7,875 10,125 40,521 17,640 19,575

Operating Profit $13,275 $21,600 $12,354 $41,580 $43,875

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+Navigating through uncertainties

Entrepreneurial Though and Action ®

Fail fast learn quick

Cubist Capital

Partner with Babson and likes

Create an incubator to keep innovations flourishing

Hampers negative attitude and fosters healthy competition

Raison detre

Opportunity

Business Model

Value Creation

Value Delivery

Value Capture

Navigating

uncertainties

Risk and mitigatio

n

Conclusion

15

+Conclusion

CubiSafe

Quick positive cash

flow

Fractional R&D

cost

Quick to market

Testimony for

employess

Business diversificatio

n opportunity

Standard for

Bacteria Removal

Entrepreneurial thought and

action

Raison detre

Opportunity

Business Model

Value Creation

Value Delivery

Value Capture

Navigating

uncertainties

Risk and mitigatio

nConclusion

16

+

THANK YOU!!

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+Organizational Strategy

+18

Risk and Mitigation

New partner alliances

Low barrier to entry

Not an end product

No credibility in this space

Supply chain dynamics

Pricing

Cannibalization

Co-branding

Partner with credible players

Increase barriers by establishing brand early on

Discerning market sensing

If you do not address someone else will – look at it as opportunity

Patent – With application

Raison detre

Opportunity

Business Model

Value Creation

Value Delivery

Value Capture

Navigating

uncertainties

Risk and mitigatio

n

Conclusion

19

+

Option for additives

Future Growth

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+Cannibilazation

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+Product selection

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+Benefits of going with OEM

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+Sensitivity analysis

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+Competitive analysis

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+Modeled Assumptions