BUSINESS SITUATION THE OLD RULES N O LONGER APPLY The fundamental structures of the healthcare industry are being challenged. The healthcare market is becoming more consumer driven as disease and treatment information become more accessible and as digital increasingly fuses expectations across industries. In addition, a proliferation of data and new technology is revealing new insights and enabling new ways to identify patients' needs and deliver quality care. Some of the market forces changing the healthcare landscape include: Healthcare companies face new economic realities Healthcare spending keeps rising as a percentage of gross domestic product (GDP), driven largely by labor costs. Margins are being squeezed by continued market, legislative, and regulatory pressures. Simultaneously, business models are evolving as reimbursements become more tied to outcomes. Healthcare markets are changing Consumers are bearing a greater burden of their healthcare cost and risk. As such, they are becoming more engaged shoppers for quality care and excellent customer service at a fair cost. Simultaneously, demand is growing as chronic conditions become more prevalent, with aging populations and growing affluence in emerging markets. The digital healthcare revolution is here New data sources, artificial intelligence (AI), and computing power are enabling breakthroughs. Insights are being unlocked from vast data sets (e.g. genomes, electronic health records (EHRs), mobile diagnostics, wearable devices). This creates the potential to accelerate new drug discovery, precision health, and operational savings. To navigate this time of risk and opportunity, healthcare companies need to approach the market and their business in a fundamentally different way. INTELLIGENT HEALTHCARE THE RACE TO REINVENT HEALTHCARE 2