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1 ICON Plc. 2008 Raymond James Institutional Investors Conference – March 4 th, 2008 Mr. Peter Gray - CEO.

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Presentation on theme: "1 ICON Plc. 2008 Raymond James Institutional Investors Conference – March 4 th, 2008 Mr. Peter Gray - CEO."— Presentation transcript:

1 1 ICON Plc. 2008 Raymond James Institutional Investors Conference – March 4 th, 2008 Mr. Peter Gray - CEO

2 2 Certain statements contained herein including, without limitation, statements containing the words “believes,” “anticipates,” “intends,” “expects” and words of similar import, constitute forward-looking statements concerning the Company's operations, performance, financial condition and prospects. Because such statements involve known and unknown risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Given these uncertainties, prospective investors are cautioned not to place undue reliance on such forward-looking statements. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Forward Looking Statements

3 3 Global Full Service Clinical Development US 53% EU 38% ROW 9% Q4 Revenue by Region Global Clinical

4 4 North America 2 Countries 17 Offices >1,900 Staff Western Europe / Africa 10 Countries 13 Offices >1,600 Staff Asia Pacific 8 Countries 10 Offices >450 Staff Latin America 5 Countries 5 Offices >170 Staff Projects in 60+ Countries ICON’s Global Clinical Footprint Eastern Europe / Russia 8 Countries 9 Offices > 350 Staff Japan 1 Country 2 Offices >80 Staff ICON’s Global Clinical Footprint

5 5 Market Environment

6 6 Strong Market Environment with... Continued R&D Spending Growth. ¯ Phase II / III pipelines strengthening Increased Outsourcing ¯ Being accelerated by activity & funding in Biotech / Speciality ¯ Globalisation of clinical research ¯ New strategic thinking / cost containment Increasing Regulation ¯ More patients/ more studies ¯ Post marketing surveillance 5

7 7 Preclinical Compounds in Development Source: Pharmaprojects Up ≈ 23% The Pipeline continued to fill in 2007

8 8 Phase I Compounds in Development Source: Pharmaprojects Up ≈ 22% The Pipeline continued to fill in 2007

9 9 Phase II/III Compounds in Development Source: Pharmaprojects The Pipeline continued to fill in 2007 Up ≈ 14%

10 10 $Billion Biotech fundraising (excluding debt financing) Source: Burrill and Company US Biotech Funding Environment continued to grow

11 11 ICON in this Market Environment

12 12 RFP Value by Market Segment 2007 Value  54% Increase / PY Size of Projects  41 > 20 Million  168 > 5 Million  959 < 5 Million Gross RFP Value by Market Segment (Including RFPs that never progress to award)

13 13 Strong RFP volume growth, with increasing average proposal value…

14 14 …which has led to increasing numbers of awards greater then $5 million.

15 15 Overall, Strong Gross Business wins has led to… ICON Gross Business Wins - Last 10 Quarters ($ millions)

16 16.. excellent Net New Business wins and very strong book to bill ratios… Net Business Wins Book to Bill Ratio

17 17 …leading to record Total Backlog levels. ($ millions) Up 38% YoY Up 49% YoY

18 18 From this backlog, coverage of next 4 quarters revenues is robust…….. Value of backlog forecast to be earned in next 4 quarters % coverage of next 4 quarters forecast revenues

19 19 This has led to a diversified customer base…… Client Diversity 2005, 2006, 2007 2007 - New Business by Customer Segment

20 20 ….and broad therapeutic expertise. Revenue by Therapeutic Area 2007

21 21 Quality

22 22 From 2000 – 2006 ICON has been the fastest Growing CRO, and this has continued in 2007.. * Source SEC Filings (ICON Growth 2007 = 32%)

23 23 …but Quality and Delivery remains our Key Focus.

24 24 ISO9001:2000 Registered Since 1994. External assessment of ICON’s Global Quality System ¯ Group registration for the whole company Annual random surveillance audits across regional offices to monitor compliance - audit frequency is based on office size and number of services All new offices independently audited to attain registration ¯ 2007 audit program USA: PA, FL, NC, CA-Irvine, CA-Redwood City Europe: IRL, GER, SWE, RUS, HUN, POL, ITL* ROW: South Africa, CAN, MEX*, ARG (*new offices registration audits) The following accreditations are maintained by ICON Laboratories ¯ ISO 17025 ¯ CAP accreditation ¯ CLIA (New York facility only)

25 25 ICON Internal QA Audits – 2007 DivisionUSEUROWTotal Clinical Research22115450425 Central Lab5422076 Development Solutions302200250 Medical Imaging2300 Quality system audits18432889 34643978863 We Live Quality Internally,….

26 26 DivisionSponsor Clinical Research148 Central Lab41 Development Solutions31 Medical Imaging18 238 Client, Regulatory and ISO Audits – 2007 … Clients Check it,….

27 27 OfficeDateRegionAuditing AuthorityOutcome Redwood City, CAOct 2003USFDANo findings (no FDA 483) New York City, NYMar/Apr 2005USFDANo findings (no FDA 483) North Wales, PAMay 2005USFDANo findings (no FDA 483) Nashville, TNOct/Nov 2005USFDANo findings (no FDA 483) North Wales, PADec 2005USFDANo findings (no FDA 483) Nashville, TNJan 2006USFDANo findings (no FDA 483) Eastleigh, UKOct 2004EUMHRANo critical findings Dublin, IrelandApr 2005 EU IMBNo critical findings Eastleign/Marlow, UKSept 2007EUMHRANo critical findings Frankfurt. GermanySept 2007EU Local regulatory authority: RP Darmstadt No critical findings SingaporeOct 2005ROW HSA - Health Services Authority of Singapore No critical findings …Regulatory Agencies Inspect it,….

28 28 …and 3 rd Parties Validate it SurveyYearComments William Blair / PharmaMediation 2004Top CRO for quality and execution. CenterWatch Survey of Investigative Sites 2005 Top 3 CRO for Investigator relationships and site management. Frost Sullivan2006 Top 3 CRO for timely database lock and key attributes of overall quality, personnel expertise, therapeutic expertise, and project turnaround. Thomson CenterWatch and William Blair 2007 Vendor you most prefer working with based on quality. Lehman Brothers2007Top CRO for quality of global execution. SGS – ISO AuditAnnual Passed without significant comments since 1995

29 29 Strategy

30 30 ICON’s Core Strategy is Organic Growth, with acquisitions made to add new services or scale. Capitalise on market fundamentals to drive organic growth in all business units. Pursue acquisitions to enhance depth and scale of current operations and to add additional complementary services e.g. Phase I - US Bioanalytical / Biomarkers Therapeutic specialists Safety / Phase IV Patient Recruitment Staffing Cross-sell services to grow sales and margin Acquisitions to date - 11 Revenues acquired $114m Staff acquired – 1,100 => Organic growth >80%

31 31 Key Strategic Trends Strategic v Tactical Outsourcing ¯ More large companies are seeking to use outsourcing strategically rather than tactically. ¯ ICON fully engaged. Globalisation ¯ Growth in Eastern Europe, Latin America and Asia as a venue. ¯ ICON growing rapidly in these regions Greater Scientific Involvement ¯ Customers seeking greater scientific input from CROs ¯ ICON has added TAGS, IDS, Imaging, new Lab technologies etc. to respond. EDC ¯ Estimated that over 40% of clinical trials now use EDC ¯ 49% of ICON’s Data Management activity in 2007 was EDC

32 32 Financial Performance

33 33 Net Revenue CAGR of over 30% since 2002 22% Forecast for 2008 CAGR 32% * Mid Point of 2008 Guidance issued December, 2007

34 34 Earnings Per Share Growth CAGR 26% (E) * Mid Point of 2008 Guidance issued December 2007

35 35 Recent Financial Performance ($ millions, except EPS; includes stock option expense) Q4 ’07Q4 ’06% Increase Net Revenue18112940% Direct Costs1007337% SG & A553845% D & A5437% _____ Operating Income201443% Operating Margin11%10.7% Net Income161140% _____ EPS (Inc SFAS123R)53c39c36% Weighted Average no. of Shares (Inc SFAS123R) 29.9m29.1m2.7%

36 36 Recent Financial Performance ($ millions) FY2007FY2006% Increase Net Revenue63145638% Direct Costs35525638% SG & A18813738% D & A191527% _____ Operating Income694845% Operating Margin11%10.5% Net Income563846% _____ EPS (Inc SFAS 123R)188c133c41% Weighted Average no. of Shares (Inc SFAS123R) 29.7m28.7m3.5%

37 37 Approx. 25% of ICON’s business is generating single digit margins ¯ Further margin growth in Lab ¯ Improve performance from Phase I and Consultancy businesses ¯ Bring Japan to higher profitability Expand margins in Phase II – IV through leverage as growth moderates. Currency Movements creating some “Headwinds” 5 Margin improvement is a key focus.

38 38 Summary Balance Sheet and Cash Flow ($ millions) May 31, 05 (Year) Dec 31, 05 (7 mths) Dec 31, 06 (Year) Dec 31, 07 (Year) Net Cash$78.4$82.3$98$23.8 Total assets$347.6$349.1$476.3$693.1 Shareholder’s equity$233.1$241.6$302.7$388.4 Cashflow from operations $23.8$11.7$51.5$42.9 Capital expenditures$15.6$12.1$31.5$75.4 CAPEX Excl. Dublin Extn.$15.6$12.1$20.4$36.8 Shares outstanding27.828.028.528.8

39 39 85 bed clinical research unit in San Antonio, TX Experienced team with excellent market reputation Clinical pharmacology platform in the US to complement the UK CPU Requires business development and commercial management support Cost = $12m (Potential for further $10m if certain challenging targets met for ’08) Revenues in ‘07 ≈ $8m Profitable in H2 2007 Expected revenues of $10 - $12m in 2008 Earnings neutral 2008 (Earnout payment will not be triggered with this outcome) Recent Phase I Acquisition In The US Completed February 11 th, 2008

40 40 Top Global Clinical CRO - #4 Outstanding record of growth Strong market fundamentals Excellent strategic position Strong balance sheet Margin expansion opportunity Investment Case Summary

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