Insulet Nov 16th Investor Meeting - NASDAQ OMX …files.shareholder.com/downloads/AMDA-HCNX4/2785949235x0x... · Investor Day Agenda Welcome Deborah Gordon Opening Remarks Patrick

Investor DayNovember 16, 2016

Insulet Investor Day - November 16, 2016

WelcomeDeborah GordonVice President, Investor Relations and Corporation Communications


Investor Day Agenda

Welcome Deborah Gordon

Opening Remarks Patrick Sullivan

Commercial Update Shacey Petrovic

Technology Roadmap and Product Innovation Aiman Abdel-Malek, PhD

Break (20 minutes)Artificial Pancreas Lunch Panel Moderator: Patrick Sullivan

Panelists: Shacey Petrovic, Dr. Trang Ly, Aiman Abdel-Malek, Richard Spector

Manufacturing & Operations Update Charles Alpuche

Financial Performance Michael Levitz

Closing Comments and Q&A Patrick Sullivan

Exhibits


Forward Looking Statement

This presentation may contain forward-looking statements concerning Insulet's expectations, anticipations, intentions, beliefs or strategies regarding the future. These forward-looking statements are based on current expectations and beliefs concerning future developments and their potential effects on Insulet. There can be no assurance that future developments affecting Insulet will be those that it has anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond its control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements, and other risks and uncertainties described in its Annual Report on Form 10-K, which was filed with the Securities and Exchange Commission on February 29, 2016 in the section entitled "Risk Factors," and in its other filings from time to time with the Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize, or should any of its assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. Insulet undertakes no obligation to publicly update or revise any forward-looking statements.


© 2016 Insulet Corporation. Omnipod, the Omnipod logo and Podder are trademarks or registered trademarks of Insulet Corporation. All rights reserved. All other trademarks are the property of their respective owners. The use of third party trademarks does not constitute an endorsement or imply a relationship or other affiliation.



Opening RemarksPatrick SullivanChief Executive Officer and Chairman of the Board

6Insulet Investor Day - November 16, 2016

Patrick SullivanChief Executive Officer and

Chairman of the Board

The Team

7

Shacey PetrovicPresident and

Chief Operating Officer

Charles AlpucheSenior Vice President, Global Manufacturing

and Operations

Deborah GordonVice President, Investor

Relations and Corporation Communications

Aiman Abdel-Malek, PhDSenior Vice President,

Advanced Technology and Engineering

Michael LevitzSenior Vice President, Chief Financial Officer


Dr. Trang LyVice President and

Medical Director

2021 Targets

Insulet Investor Day - November 16, 2016 8

65%+ Gross Margin

Above-Market Profitability

$1 Billion in Revenue (20%+ CAGR)

Insulet’s Right to Win


•Large and growing market

•Underpenetrated with unique value

OPPORTUNITY

•Highly differentiated•Convenience, compliance and control•Multiple applications

PRODUCT PLATFORM

•Sustainable above-market returns•Experienced and talented team•High quality, reliability and decreasing cost

PROVEN PERFORMANCE

Significant Growth Opportunity


Countries today

Share of U.S. type 1 diabetes market

Share of international type 1 diabetes market

Share of type 2 diabetes market

1-2%

4%

16

<1%

Non-insulin drugs approved with the Omnipod platform2

Insulet internal analysis, International Diabetes Federation. Numbers are approximate.

One Digital Platform… Many ProductsInnovating to Simplify Life


Omnipod®

TodayDash Mobile

PlatformArtificial Pancreas

BetterControlBetterQualityof Life

Proven PerformanceTransformation to Sustainable, Above-Market Performance


Transform

BuildFoundation

forPerformance

AccelerateGrowth

• Assemble talented, experienced team

• Transform strategy & execution• Drive product quality and

efficient operations• Divest Neighborhood Diabetes

• Establish technology development and scalable operations

• Establish unique, innovative R&D platforms

• Secure market access and invest in clinical data and infrastructure

• Launch new products and double addressable market

• Lower cost through U.S. automated manufacturing

2015-2016 2018-20212016-2018



Commercial UpdateShacey PetrovicPresident and Chief Operating Officer


Differentiated Technology in Growing Market

Sizable, underpenetrated market with attractive tailwinds

Commercial and operational execution driving near-term growth

Innovation and Drug Delivery accelerate medium- and long-term growth


Diabetes is a Worldwide Epidemic365 Million Patients and $490 Billion Spend by 2030

1. http://www.orgenesis.com/market/market-overview and WHO2. Economic impact of Diabetes; Ping Zhang; IDF Diabetes Atlas 4th edition

$375

$490

2010 2030

171

365

2000 2030

Global Diabetes Expenditure2 ($ in Billions)Global Patients Diagnosed1 (in Millions)


Global epidemic presents significant unmet need and market opportunity16

Omnipod’s Differentiated Platform Simplifies Life

Reduces burdenSimplifies lifeImproves outcomes


Kelly L.

Omnipod Significantly Reduces Burden of Multiple Daily Injection (MDI) and Pump Therapy

1. Insulet internal data

Injections Required Per Pod (Average of 4.5/day)1

vs.

Omnipod: 1 MDI: 14+

Fewer Injections Fewer Components

vs.

OmnipodSystem

ConventionalInsulin Pump

of the Market Opportunity20% of the Market Opportunity (Current Target)80%


Globally, majority of market relies on inferior, burdensome MDI as primary therapy18

Omnipod is Strongly Preferred Brand

Insulet Investor Day - November 16, 2016 19Source: dQ&A Diabetes Connections U.S.A. Patient Panel Report, Q3 2016

21%

41%

18%18%

2%InsuletMedtronicAnimasTandemRoche

U.S. Pump Brand Preference by Company

Significant opportunity to gain share through product line extensions

32%

10%10%

22%

18%

3% 5%OmnipodMiniMed 530GMiniMed Paradigm RevelAnimas OneTouch PingTandem t:slimMedtronic Other ModelsOther

Omnipod is #1 preferred product in pediatrics

U.S. Pediatric Preference by Product U.S. Adult Preference by Product

19%

21%

16%10%

12%

7%

15% Omnipod is #2 preferred product in adults

Market Opportunity Doubles in Five Years


2016-17

2018-19

2020-21

1. Type 2 Diabetes Insulin Resistant

• Increase in U.S. addressable opportunity with U-500 launch (T2D1)

• U.S. market access barriers removed (Medicaid and Medicare)

• Artificial Pancreas (AP) launch• Geographic expansion

INCREASE GROWTH

• U-200 doubles addressable opportunity

• Geographic and product expansion increase Omnipod penetration

200K+ Users

ACCELERATE GROWTH

• Focus on large, growing EU and U.S. MDI opportunity

• Focus on Type 1 Diabetes (T1D)• Launch of Dash mobile platform

100K+ Users Today

GROWTH IN EXISTING MARKET

Growing market + improved access + new product launches = 100+% growth

8.4

7.8

Efficacy of the Omnipod (OP) Insulin Management System on Glycemic Control Among Patients with T1D Previously Treated with MDI or Continuous Subcutaneous Insulin Infusion (CSII)

Omnipod offers significant clinical and economic advantages

8.3

7.8-7.8

-4.8

Prior MDI Prior CSII

Clinical Evidence Demonstrates Improved Outcomes in Study of ~900 Patients


Prior MDI Prior CSII

Pre OP Post OP

0.6 Reduction in HbA1c 16% Reduction in Total Daily Dose Insulin Units

38% Reduction in HypoglycemicEpisodes Per Week

2.6

1.6

Pre OP Post OP

Source: Layne JE et al. J Diabetes Sci Technol. 2016;10(5):11301. Internal analysis2. Am J Manag Care. 2011;17(10):673-680

0.6 0.5

~$1K annual savings for

MDI patients1

1.0

~$17K for inpatient visit2


73 70

54 51

Improvements Observed For:

Perceived control Diabetes distressOverall well-being Hypoglycemic safety

Clinical Evidence Demonstrates Improved Quality of Life in Study of 1,200 Patients

Impact of the Omnipod Insulin Management System on Quality of Life: A Survey of Current Users

59%

25%

Moderate/Severe Distress

Pre OP Post OP

Source: Polonsky WH et al. Diabetes Technol Ther. 2016;664-70.

56% Fewer People Reporting Moderate or Severe Distress Glycemic ControlPercent of People with

Improved Quality of Life

• 64% reported an improvement in A1c

• 43% reported an improvement in A1c ≥0.5

• 35% reported fewer episodes of severe hypoglycemia

Omnipod simplifies life22

http://online.liebertpub.com/action/showLargeCover?issue=40200937

http://online.liebertpub.com/action/showLargeCover?issue=40200937

Clinical Investment Focused on Improved Outcomes, Quality of Life and Innovation


Clinically meaningful improvement in A1C, time in range, adverse events

Improved clinical outcomes, quality of life benefits and reduced medical costs (insulin use, ER visits, hospitalizations)

Improvement in key patient and caregiver reported outcomes

Demonstrate clinical and quality of life impact of technology advances

Clinical Impact Payer Benefits Improved Quality of Life

Innovation Pathway

• T1D and T2D Publications in JDST• German DPV Registry Analysis• QoL Survey in Diabetes Technology

and Therapeutics

• Omnipod Horizon Automated Glucose Control System Clinical Study Results

• Cook Children’s Medical Center OP Protocol

• In Silico Modelling of Insulin Doses and BG (Blood Glucose) Effects

• T1D Glu Community Survey• German DPV Registry Analysis Update

Studies and Publications:Completed In Process

Clinical data is key to increased adoption

Investing for Growth

Concentrated Insulins

Market Access

Geographic Expansion

Innovation


Drug Delivery

Introducing the Omnipod Dash SystemPlatform for Future Innovation

Innovation


Simplicity of user experience is foundation for innovation25


Concentrated Insulins Double Omnipod’s Addressable Market

5X more concentrated than standard U-100 insulin

2X more concentrated than standard U-100 insulin

&

1. For use with Humalog U-200 insulin2. For use with Humulin U-500 insulin

in partnership with

U-2001 Higher Insulin-Requiring Patients U-5002 Severe Insulin-Resistant Patientsequivalent to a

1,000 unit reservoirequivalent to a

400 unit reservoir

Omnipod Dash

Concentrated Insulins

Dash platform provides access to additional patient segments26

Addressing Reservoir Capacity Doubles Omnipod OpportunityConcentrated Insulins

1.2M

0.2M0.1M

<60 Units

60-200 Units

>200 Units

Current Omnipod System

Addressable with:

U-200 Omnipod System

U-500 Omnipod System

Insulet Investor Day - November 16, 2016Sources: Internal Insulet analysis; NIH, CDC, dQ&A, BBC, JDRF Fact Sheet, DDC Diabetes Report Card 2012, T1D Exchange

Expanded opportunity leverages existing channel27

0.3M

1.2M

0.2M

~1.5 Million

T1D

~1.7 Million

T2D

Daily need:

Broad Private Payer Access Fuels Continued Growth Increased Efforts Will Expand Coverage


Market Access

Unlocking Medicare and Medicaid access accelerates growth

Focused on Growing U.S. Market Access• Continued dialogue with CMS on Medicare

coverage

• Broadening awareness with expanded team of highly skilled market access professionals

• 2016 added 6 Medicaid plans

• Investment in trials and data supports Omnipodvalue proposition

Current Omnipod/ AccessMedicare/Medicaid Expanded Coverage

~70%

~30%

N = 3.2 Million

Significant Potential in International Market Penetration and Expansion

North America Asia-PacificWestern Europe3.0 – 3.3 3.0 – 3.4 4.0 – 5.0

Launched Markets (Pre-2016) New in 2016 Future Expansion

Geographic Expansion(in millions)


Omnipod’s differentiated platform provides growth worldwide

Insulet is Celebrating

100,000Active Global Podders


Success with the Neulasta OnPro Kit

0%

10%

20%

30%

40%

50%

60%

Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 (Est.)

Share of U.S. Doses


Drug Delivery

Self-injection Devices Expected to See Significant Growth

1. Markets & Markets: “Drug Delivery Technologies Market”2. Auto-injectors, pen-injectors, wearable injectors, and needle-free delivery devices

$6.4 $7.1 $7.9$8.8

$9.8

2016 2017 2018 2019 2020

Self-injection Devices2

~$10 Billion global opportunity by 20201

($ in billions)


Drug Delivery


Significant Unmet Need in Self-injection Devices

1. Reasons for Discontinuation of Subcutaneous Biologic Therapy in the Treatment of Rheumatoid Arthritis: A Patient Perspective2. Misuse of Medical Devices: A Persistent Problem in Self-Management of Asthma and Allergic Disease

Conventional self-injection devices have significant limitations for the current generation of drugs

The next generation of drugs need patient-focused solutions

Drug Focused

Quantity

Time

Highly viscous, large volume formulations in development

Injection profiles from seconds to hours

Patient Focused

Pain

Misuse

Discontinuation due to: • Fear• Frequency of injections • Reactions around the injection site1

84% of patients misuse auto-injectors2

33

Drug Delivery

Insulet’s Drug Delivery Business Innovation Pathway

Oncology

Infertility

Cardiovascular

Endocrinology

Other Therapeutic Areas

ImprovedAdherence


Digitalfor connectivity

remote monitoring

Device design for patient preference

User experience for ease of use

34

Drug Delivery


Insulet Delivers 20%+ Revenue CAGR and Grows to $1 Billion

$363M1

$1B

2016 2021

Drug Delivery

Omnipod

2016 Revenue Guidance of $362M - 365M1

1. As provided on on our earnings call on November 3, 2016

20%+CAGR

35

I have requested these images so we can rebuild this slide, so not much to do right now, except we can create the text boxes AND we need to incorporate the following text so it dominates the slide: With OmniPod I Can! (okay to adjust/tweak this existing layout to accommodate)

SINCE 2013SINCE 2014SINCE 2015SINCE 2012

SINCE 2016SINCE 2013SINCE 2009SINCE 2015

With Omnipod, I can

36



Simplifying Life… Insulet’s Technology RoadmapAiman Abdel-Malek, PhDSenior Vice President, Advanced Technology and Engineering


Agenda

39

Insulet’s Digital Platform Technology Foundation

One Platform... Many Products

Targeted Timeline


Simplifying Life Building Insulet’s Digital Platform for the Future



QualityandReliability

4117M pods expected to be manufactured in 2016 Insulet Investor Day - November 16, 2016


42

Mobileand Cloud Technology


Pope FrancisPope Benedict XVI

Qualityand

Reliability


UserExperienceDesign and Data Analytics

43

Feature RichComplex User Experience


MP3

Mobileand

CloudTechnology

Qualityand

Reliability

Focused FeaturesIntuitive User Experience

iPod

Mobileand

CloudTechnology

Qualityand

Reliability

UserExperience

Design and DataAnalytics

Qualityand

Reliability


User ExperienceDesign and

Data Analytics



• >150 years mobile software experience

• Industry experts: Qualcomm, Broadcom

• Experts in wireless security and internet of things (IoT)

• >75 years data science experience

• Proven predictive analytics experts

• AP algorithm and therapy optimization

• >300 years engineering experience

• Innovative soft cannula insertion system

• Reliable platform designs

• >250 years engineering experience

• Patented tubeless electronic pump drive

• Experts in design for manufacturing

Strengthening Our R&D Capabilities

45

Mechanical Design and Manufacturing

Electronic Design and Manufacturing

Mobile, Cloud and Secure Wireless Software

Data Analytics Excellence

Growing our innovation patent portfolio

San DiegoBostonBoston Boston

Secure Cloud

Data Analytics

User ExperienceDesign

Billerica

• >70 years of user experience (UX) design

• UX industry experts: GE, MIT, Philips

• Design workshops with over 70 Podders

Boston

Plan Research

Design

Adapt

Measure

User-CenteredDesign


Current Omnipod SystemProven Innovative Platform

46

Tethered Tubed Pumpcomplex simplestandard

MDI Omnipod

vs.vs.

Key Takeaways

• Patented tubeless insulin delivery withuser friendly form factor

• Proven reliability;millions tested each year

• Designed for manufacturability built on extensible platform

Qualityand

Reliability


Introducing Omnipod Dash Insulin Management SystemOne Digital Mobile Platform... Many Products

PDM(Android Locked-Down Device)

BLE BloodGlucose Meter

BLE Pod

Secure Cloud Data Analytics

User Secondary Display Mobile App

Caregiver FollowMobile App

47

Qualityand

Reliability


UserExperienceDesign and

Data Analytics


BLE = Bluetooth Low Energy PDM = Personal Diabetes Manager

DASH Platform Video


Omnipod Dash System Mobile Platform Simple, Secure, Scalable and Smart


Qualityand

Reliability


• Simple touch screen user interface designed with Podders and their caregivers

• Simple secondary display of Pod and CGM data on user’s mobile app

• Simple “Caregiver Follow” app with cloud alerts and alarms

• Secure BLE Pod and PDM communicationleveraging latest IoT (Internet of Things) security innovations

• Scalable platformextends to U-200/U-500 concentrated insulins and other drug delivery applications

• Smart and Securecloud data and analytics enabling therapy optimization

SIMPLE SCALABLESECURE SMART


Data Analytics

50

Dash PDM

Algorithm Integrated into the Pod

Omnipod HorizonCGM

Cloud Server

All Dash Features PLUS

• Same Pod onlysmarter with on-body analytics

• Hybrid closed loop ensures safe control

• Integrate CGM datavia secure direct connect

Qualityand

Reliability



Data Analytics

Caregiver FollowMobile App

User Secondary Display Mobile App


Data AnalyticsInsulet’s Horizon Artificial Pancreas Based on the Omnipod Dash System Mobile Platform

CGM = Continuous Glucose Monitoring

Dash

ConcentratedInsulins on Dash

Targeted Timeline

5151

510K Submission Launch

Eli Lilly Clinical Trial

Eli Lilly Clinical Trial

Launch

Launch

FDA IDE 1 Submission

IDE Clinical Trials

Pre-Pivotal Trials

2017 2018 2019 20202016

Pivotal Trials

U-500

U-200

Launch

HorizonArtificialPancreas


OmnipodToday

One Digital Platform… Many Products

OmnipodMDI

vs.

Dash Mobile Platform

Secure Cloud Data Analytics

Artificial Pancreas

On-Body Analytics

BetterControlBetterQualityof Life


Simplifying Life... A Personal Mission




Artificial Pancreas PanelModerator: Pat Sullivan, Chief Executive Officer and Chairman of the Board

Panelists:Shacey Petrovic, President and Chief Operating OfficerDr. Trang Ly, Vice President and Medical DirectorAiman Abdel-Malek, PhD, Senior Vice President of Advanced Technology and EngineeringRichard Spector, Insulet Employee and Omnipod User




Manufacturing and Supply Chain Operations UpdateCharles AlpucheSenior Vice President, Global Manufacturing and Supply Chain Operations


Manufacturing History

Manufacturing volumes and capacity have continued to increase58Insulet Investor Day - November 16, 2016

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Original U.S.Production

Line 1Flex China

Lines 2 and 3

Flex China

Line 4Flex China

2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016Average

YE 2016 Target

Manufacturing Improvements

Driving productivity with more efficient output

• Reduced total headcount in Flex China by >20%

Cumulative Headcount Reduction

Daily Pod Output


Key Takeaways

• Increased daily output by >65%

• More than doubled Pods per employee in Flex China

99%

Q1 2016 Q2 2016 Q3 2016 Q4 2016 (Est.)

Reduce Scrap While Driving Higher Output

Productivity and reducing scrap driving significant COGS reduction and more consistent quality

Final Yield


Key Takeaways• Improved efficiencies drive reduced scrap

• Scrap reduction drives improved quality and cost

• Improved yields = more reliable and predictable supply chain for our customers

Key Takeaways• Improved efficiencies drive reduced scrap

• Scrap reduction drives improved quality and cost

• Improved yields = more reliable and predictable supply chain for our customers

99%

Q1 2016 Q2 2016 Q3 2016 Q4 2016 (Est.)

-15%

Reduce Scrap While Driving Higher Output

61

Key Takeaways

• Driving sustainable cost reductions

• Increasing labor productivity

• Reducing waste >50%

Pod Cost vs. 2015 Actual

Productivity and reducing scrap driving significant COGS reduction and more consistent quality


Dec 2015 Dec 2016 (Est.)

Yield Components

ManufacturingConversion

Total Manufacturing Savings of ~15% Per Pod

Driving sustainable gross margin improvements

Key Takeaways

• Improved overall manufacturing operations performance driving sustainable cost per Pod savings and gross margin improvements


Insulet Supply Chain Operations

Raw Material Supplier

Sub-Component Supplier

SterilizationRaw Material Supplier



Customers

2016

ProcessFlex China

Manufacturing


Decrease inventory handling while increasing speed to market

InventoryWarehouse

Insulet Supply Chain Operations 2019 & Beyond



SterilizationRaw Material Supplier



Customers

Added U.S. manufacturing… Driving continued reduction in total landed cost

ProcessInsulet U.S.

Manufacturing

64

ProcessFlex China

Manufacturing


InventoryWarehouse

1. Total landed cost equals all costs from component suppliers to our distribution center

Expanding Pod Manufacturing

65

U.S. MANUFACTURING ACHIEVES RISK MITIGATION & SPEED TO MARKET…

LABOR WAGE INCREASES DISTANCES TRAVELED SUPPLY CHAIN LEAD TIMES

1 2 3


…WHILE FURTHER AUTOMATING TO LOWER TOTAL LANDED COST

1. Total landed cost equals all costs from component suppliers to our distribution center

China Wage Rate Inflation Normalized vs. U.S.

1.0

3.3

1.3

2006 2008 2010 2012 2014 2016

China wage inflation quickly closing the gap for total lowest landed cost

Key Takeaways• Annual labor rate increases of

double digits

• High indirect support : direct labor ratio

• Management rates = U.S.

• China averaging 5% labor attrition per month vs. 3% annually in U.S.

• Total landed cost from China is similar to U.S. manufacturing cost and is a critical metric that must be considered

661. China wage rate increases based on data from Chinese Ministry of Human Resources and Social Security2. U.S. wage rate increases assumed at 3% annually Insulet Investor Day - November 16, 2016

U.S.Manufacturing

ChinaManufacturing

Mileage Supplier to FactoryMileage Factory to U.S. DistributionOpportunity for Mileage Reduction

Reduction in Supply Chain Mileage

Key Takeaways

• Components globally sourced from U.S., Europe and Asia

• U.S. production reduces mileage traveled for average component


50%Reduction

U.S.Manufacturing

ChinaManufacturing

Mileage Supplier to FactoryMileage Factory to U.S. DistributionOpportunity for Mileage Reduction

Reduction in Supply Chain Mileage

Right place, right time, right cost

Key Takeaways

• Components sourced from U.S., Europe and Asia

• U.S. production reduces mileage traveled for average component

• Localized component sourcing will drive up to an additional 25% reduction… shortening supply chain lead times, reducing inventories and lowering total cost


50%Reduction

Reduction in Supply Chain Response Time

Insulet U.S.

Flex via sea

Flex via air

2019+

2016

2017+ Floating Warehouse

Lowering inventory while improving response time to customers

Lot QualReleaseSterilizationTransit to

SterilizerProductionof Lot

Key Takeaways

• Historically air freight all finished goods from China to U.S.

• Move to ocean freight drives 50% cost reduction and avoids incremental cost of warehouse infrastructure

• U.S. manufacturing reduces time, cost and inventory requirements


17 Days Total

25 Days Total

61 Days Total

• Continue to improve performance at Flex China

• Begin build of redundant U.S. manufacturing location

• First U.S. line operational

Global Manufacturing Strategy

2017 2019

• Highly-automated U.S. manufacturing• Each U.S. line results in:

– Up to 70% capacity of total China operation

– Up to 90% fewer headcount vs. total China operation


Manufacturing Strategy Video


2015 2016 (Est.) 2021 (Est.)

Yield Components



Components Freight

~15% Cost Reduction

~15 - 20% Cost Reduction

Sustainable Cost Per Pod Reduction Opportunities

Supply chain will continue to drive significant margin growth in 2017-2021

72

Key Takeaways

• Continued sustainable cost savings

• Conversion savings through improvements in equipment utilization and labor efficiency

• Components savings by improved contractual agreements and competitive bidding

• Savings by ocean freight and U.S. manufacturing


/ /

35 Years in OpsGlobal Leadership

Manufacturing and Supply Chain Operations Leadership


We have the right people to deliver results

Sr. VP Global Manufacturing & Operations

VP Strategic Sourcing and

Supplier Development

VP Drug Delivery Systems

Manufacturing OpsVP U.S.

ManufacturingVP Global

Supply ChainVP China

ManufacturingSr. Director Distribution

Years in Ops 12 34 34 25 35 23

RolesSr Manager,

Director: R&D, Quality & Ops

VP Ops, VP Manufacturing,

VP PM

VP Ops,VP North America

Manufacturing

VP Manufacturing, VP Eng,

Dir Continuous Improvement

VP International and North AmericaManufacturing

Director Supply Chain Ops

Global Exposure U.S., Europe U.S. U.S., Europe, Asia U.S., Europe, Asia U.S., Europe U.S., Canada

Companies Abbott CMI/Roche, Cytyc PepsiCo, J&J GE, Covidien PepsiCo PepsiCo, J&J

Manufacturing and Operations Summary


LASER FOCUSED TO DELIVER RESULTS

Right Place

Right Cost

Right Product

Right Time

Right People



Financial PerformanceMichael LevitzSenior Vice President, Chief Financial Officer


Targeting $1 Billion in Revenue

77

Key Takeaways• Above-market growth (20%+ CAGR)

• Strong momentum across product lines

• $1 billion target on growth across product lines, each with 20%+ CAGR

• Growth on continued execution, new products and market access

1. Mid-point of guidance from November 3, 2016 earnings call

$231 $264$363

$1,000

2014 2015 2016 (Est.) 2021 Target

U.S. Omnipod Int'l Omnipod Drug Delivery

($ in millions)

2021 (Est.)


1

/ /

Delivered Growthof 20%+('14-'16 CAGR)

Target $1 Billionon 20%+ CAGR

('17-'21)

55%51%

57%1

65%4%6%

2014 2015 2016 (Est.) 2021

Supply Chain Operations

Improvements & U.S. Mfg.

Targeting 65%+ Gross Margin

781.From guidance on November 3, 2016 earnings call

Supply Chain Operations

ImprovementsProductQuality

Investment

Key Takeaways• 2015: Raised quality standards

• 2016: Improved quality and efficiency

• Clear line of sight to target of 65%

• Margin expansion principally from operations improvements and U.S. automated manufacturing

• Other commercial opportunities across product lines also improve margins

Other Commercial Opportunities

2021 (Est.)


/ /

Strengthened Balance Sheet Enables Value Creation

Cash and investments of over $2801 million provide sufficient funding

Convertible debt structured with low coupons and staggered maturities• $345 million due 2021, coupon of 1.25% (with conversion price of $58.37)• $67 million due 2019, coupon of 2.00% (with conversion price of $46.51)

Net proceeds of $180 million from September 2016 convertible debt support value creation• Establish U.S. manufacturing operations, with Pod production to begin in 2019• Opportunity to repurchase a portion of existing higher-cost convertible debt• Investment in inventory for cost reduction opportunities, new products and risk mitigation prior to U.S. plant• Reinvestment in the business

791. As of September 30, 2016 Insulet Investor Day - November 16, 2016

Transform

• Assembled talented and experienced leadership

• Transformed commercial execution• Increased quality and efficiency• Divested Neighborhood Diabetes

Accelerate Revenue Growth and Margin Expansion

• Launch new products on mobile platform that leverage form factor and double the addressable market

• U.S. automated manufacturing lowers product cost

Build Foundation for Accelerated Growth

• Establish U.S. manufacturing• Strengthen technical capabilities• Introduce innovative R&D platforms• Secure market access and invest in clinical data and infrastructure

Transformation to Sustainable, Above-Market Profitability

2015-2016

Revenue Accelerated to 20%+ CAGR

Gross Margin Approaching 60% gross margin

Operating Profitability

Breakeven 2H16; profitability within our control on level of investments

2018-2021

CAGR accelerates on new productsand market access

Accelerate to 65%+ on automation and commercial opportunities

Margin accelerates to above-market profitability as investments normalize

2016-2018

Continue ~20% CAGR on execution and market access

Expand annually on operations improvements while building U.S. plant

EBIT positive in 2018 and continue higher investments for future growth




Closing RemarksPatrick SullivanChief Executive Officer and Chairman of the Board


Q&A


Investor MeetingNovember 16, 2016


Documents

Insulet Nov 16th Investor Meeting - NASDAQ OMX …files.shareholder.com/downloads/AMDA-HCNX4/2785949235x0x... · Investor Day Agenda Welcome Deborah Gordon Opening Remarks Patrick