Piper Sandler : 2022 Heartland Summit Recap

recap

PIPER SANDLER HEARTLAND SUMMIT RECAP

SEPTEMBER 22, 2022 | MINNEAPOLIS

A special thank you to all our panel participants:

• Alex Gorsky, former CEO, Johnson & Johnson (JNJ)
• Amanda Packel, Director of the Rock Center for Corporate Governance, Stanford University
• Ann Gallo, Head of Healthcare, Wellington Management Group LLP
• Arthur Sands, CEO, Nurix Therapeutics, Inc.
• Bill Gassen, President & CEO, Sanford Health
• Bob Bradway, CEO, Amgen Inc. (AMGN)
• Brooke Story, President, Integrated Diagnostic Solutions, Becton, Dickinson and Company (BDX)
• Caitlin Zulla, CEO, Surgical Care Affiliates (Optum Care)
• Eddie Yoon, Healthcare Portfolio Manager, Fidelity Investments
• Eric Larsen, President, The Advisory Board Company (UnitedHealth Group Incorporated (UNH))
• Erica Rogers, President & CEO, Silk Road Medical, Inc. (SILK)
• Gary Glick, Founder & CEO, Odyssey Thera, Inc.
• Geoff Martha, CEO, Medtronic plc (MDT)
• Hemant Taneja, Managing Partner, General Catalyst Group Management, LLC
• Jakub Tolar, Dean of the Medical School, Vice President for Clinical Affairs, University of Minnesota
• James Min, Founder & CEO, Cleerly, Inc.
• Jeff Lavers, President of Consumer & Interim President of Healthcare, 3M Company (MMM)
• Jim Davis, CEO-Elect, Quest Diagnostics Incorporated (DGX)
• Joaquin Duato, CEO, Johnson & Johnson (JNJ)
• Jonathan Wolf, Co-Founder & CEO, ZOE
• Julia Cheek, CEO, Everly Health, Inc.
• Julie Yoo, General Partner, Andreessen Horowitz LLC
• Kevin Sayer, CEO, DexCom, Inc. (DXCM)
• Krishna Yeshwant, Co-Head of Healthcare, GV Management Company, LLC
• Laura Kaiser, CEO, SSM Health Care Corporation
• Lisa Shannon, CEO, Allina Health System, Inc.
• Lucy Vereshchagina, Vice President of Science and Regulatory Affairs, PhRMA
• Marcelo Bigal, CEO, Ventus Therapeutics
• Matt Eyles, CEO, America's Health Insurance Plans
• Mike Pykosz, CEO, Oak Street Health, Inc. (OSH)
• Nima Farzan, CEO, Kinnate Biopharma Inc.
• Ron Williams, former CEO, Aetna Inc.
• Sarah London, CEO, Centene Corporation (CNC)
• Scott Whitaker, CEO, AdvaMed
• Sir Andrew Witty, CEO, UnitedHealth Group (UNH)
• Stan Bergman, CEO, Henry Schein, Inc. (HSIC)
• Steve Rusckowski, Chairman, CEO & President, Quest Diagnostics Incorporated (DGX)
• Steve Ubl, CEO, PhRMA
• Sujay Jadhav, CEO, Verana Health, Inc.
• Taymour Tamaddon, Portfolio Manager, T. Rowe Price Group, Inc.

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PIPER SANDLER HEARTLAND SUMMIT RECAP

SEPTEMBER 22, 2022 | MINNEAPOLIS

To our valued clients, partners and friends:

For the 8th time, Piper Sandler was honored to reconvene the leading voices in healthcare at the Heartland Summit in Minneapolis, this year held on September 21st and 22nd.

Still in the fading shadow of a global pandemic,

From the feeling of relief and pride of accomplishment and resiliency coming out of the pandemic, the world has been met with an entirely new set of challenges. These challenges, the unintended consequences of our collective response to the pandemic, have further stressed the already fragile healthcare ecosystem. From front line workers and supply chains to the volatility in the capital markets - these challenges require new solutions, new partnerships, and steady leadership. These are the themes we explore at the Heartland Summit this year in our illuminating and insightful panel discussions.

We would like to thank Bob Bradway of Amgen, Geoff Martha of Medtronic plc, Dr. Tom Mihaljevic of the Cleveland Clinic and Sir Andrew Witty of UnitedHealth Group for their continued leadership, participation, and support for the Heartland Summit. We are grateful to the more than 30 panelists who contributed their time to these important discussions, as well as the many luminary CEOs and healthcare leaders that simply attended the Heartland Summit. We are especially grateful to those who have chosen to return year after year, bringing that continuity of leadership.

We hope that fostering these important discussions and important relationships will be a genuine, impactful and lasting legacy of the Heartland Summit. We look forward to continuing this legacy and seeing you at the 2023 Heartland Summit.

J.P. Peltier	Pete Day
Global Group Head	Global Group Head
Healthcare Investment Banking	Healthcare Investment Banking

Jon Salveson	Matt Hemsley
Vice Chairman	Piper Heartland Healthcare Capital, LLC
Healthcare Investment Banking	Chairman of the Heartland Summit

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PIPER SANDLER HEARTLAND SUMMIT RECAP

SEPTEMBER 22, 2022 | MINNEAPOLIS

Economic Outlook and Implications for the Healthcare System

Speaker: Nancy Lazar, Chief Economist, Piper Sandler

The 8th annual Heartland Summit kicked off with a compelling and insightful summary of the current and projected state

of the global economy, presented by Nancy Lazar, Chief Economist, Piper Sandler.

Lazar walked the audience through a rapid-fire overview of the economic outlook. As she put it, the U.S. economy was "an F150 going into" the pandemic. With the stimulus approach the Fed took during the pandemic, "we ended up being an F350, and the Feds can't stop it."

Now, in reaction, the Fed has to tighten aggressively by raising rates, which will put the U.S. economy into a recession, leading to unemployment. Several times she pointed out it's a trade-off. "The mantra is unemployment affects a few people; inflation affects everyone."

"We're getting this recession today because the Fed eased way too much. And in turn, we have way too high inflation. We are much better off taking this recession now, allowing a few people to get negatively impacted by higher unemployment, than to allow a period of ingrained inflation like the 1970s. No one in this room understands how painful inflation can really be, how it destroys everybody. That's what happened from the late 1960s through the early 1980s. We're better off nipping this in the bud right now rather than letting it become ingrained."

Going back through financial history, she showed past cycles and talked about what worked and didn't, in terms of strengthening the economy, while emphasizing that every cycle is different.

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PIPER SANDLER HEARTLAND SUMMIT RECAP

SEPTEMBER 22, 2022 | MINNEAPOLIS

Our current cycle is characterized by:

1. The aggressive tightening into an economy that's slowing. This increases the odds of inflation because of sticky inflation, with aggressive supply and demand.
2. A reflection of demand due to the stay-at-home bubble. Quite simply, we all bought too much "stuff," like furniture and other durable goods.
3. A monetary and fiscal cliff. Dramatic federal outlays gave individuals and companies an infusion of cash, which ended up in revenue. We saw high corporate revenue growth which isn't sustainable, especially with the slow- down in demand as the "stay-at-home" bubble slowly fades for most people. Now prices are rising and revenue growth will decrease to a more realistic single digit.

Her recommendation is to take the recession now, which is better than to take a period of extended inflation as we had in 1960s through early 80s. While businesses are concerned about the economy, they're not laying people off quickly enough. That puts profit margins at risk.

In summary, given how health the economy was prior to the pandemic, even as part of a global economy, "it's going to take a lot to slow this thing down." While keeping a close watch over the next 12-18 months, her feeling is one of optimism if the mistakes of the past are avoided.

Nancy Lazar, Piper Sandler

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