Painel Abramed - O DNA do Diagnóstico - inglês

Graph 3 Proportion of services performed with their own resources and outsourced by diagnosis segment (2019) 200 Source: Abramed Panel. 100% 7.7% 7.7% 3.8% 11.5% 3.8% 7.7% 26.9% 90% 15.4% 42.3% 7.7% 80% 70% 26.9% 50.0% 42.3% 57.7% 60% Toxicology 50% 40% 30% 96.2% 50.0% 65.4% 100.0% 57.7% 42.3% 92.3% 96.2% 88.5% Nuclear medicine 20% 10% 0% Clinical Pathological Imaging Teleradiology Endoscopic Graphic Genetics Molecular Methods biology analysis anatomy diagnosis method (including x-ray) Own resource Third parties Own resources and third parties Abramed Panel | 2020 It is possible to observe that the imaging services are perfor- med mainly with their own re- sources, while other segments presente a portion of services performed by third parties. The associates act in the sec- tor offering B2B (business-to- -business), which corresponds to service segment of the associa- ted company/group in relation to other companies operating in the market; and B2C (business-to- -customer), which comprises the service segmentof the associated company/group in direct relation to the client. In the B2B segment, 80.8% of the associates provide service in private hospitals (with or without profit) and 46.2% pro- vide service in public hospitals and other labs.

Graph 4 Service area by B2B (business-to-business) (2019) Source: Abramed Panel. Note: An associate can act in more than a segment. 201 80.8% 46.2% 46.2% 34.6% 23.1% 15.4% Serves private Serves Serves other Others Serves Serves hospitals public laboratories (specified) public healthcare the dental (with or hospitals (with support service) segment centers without profit) Considering the B2C (business-to-customer) service to the market, 73.1% of the associates provide services to beneficiaries of private healthcare plans and insurances. Graph 5 Service area by B2C (business-to-customer) (2019) Painel Abramed | Institutional profile Source: Abramed Panel. Note: An associate can act in more than a segment. 73.1% 69.2% Serves patients of Serves private patients 15.4% healthcare plans (payment (direct payment at the via healthcare plan operator) laboratory counter) Others

202 The service segments are offered in the capital cities and countryside, or just in the capital cities. The offer of services exclusively in the countryside occurs in a smalle proportion, except for the genetics and pathology anatomy services. Graph 6 Proportion of services performed in the capital or countryside by diagnosis segment (2019) Source: Abramed Panel. Note: An associate can act in more than a segment. 100% 90% 65.4% 34.6% 57.7% 50.0% 25.0% 50.0% 50.0% 57.7% 69.2% 42.3% 80% 50.0% 19.2% 30.8% 70% 12.5% Graphic methods Genetics 60% 19.2% 11.5% 50% 40% 7.7% 42.3% 15.4% 46.2% 30% 11.5% 15.4% Molecular Nuclear 20% biology Toxicology medicine 23.1% 46.2% 34.6% 50.0% 65.4% 10% 0% Clinical Pathological Imaging Teleradiology Endoscopic analysis anatomy diagnosis method (including x-ray) Capital Cities Countryside Capital cities and countryside Abramed Panel | 2020 The services provided by the group of Abramed’s associates have its qual- ity assured by a number of processes of accreditation and certification. The mais accreditations used in 2019 were: ONA 3 (National Accrediation Organiza- tion), PALC (Clinical Laboratory Accreditation Program) and ISSO 9000/9001. Generally, the associates have, on average, four certifications/accreditations by company. The following graph shows only the 10 most used certifications/ac- creditations in the sector. As well as in the previous years, the scientific production registered by Abramed’s associates is presented in a variety of national or international events, in addition to the participation in books and periodicals. In 2019, 486 publica- tions were written in magazines and periodicals, and 393 papers were presented in international congresses. The papers presented in the country totaled 194 and the number of books with participations of the associates was of 24.

Graph 7 Participation by type of certification or accreditation (2019) Source: Abramed Panel. 203 57.7% 53.8% 42.3% 38.5% 30.8% 26.9% 26.9% 19.2% 15.4% 11.5% ONA 3 PALC ISO Others ISO 14001 ONA 2 CAP PADI SELOS ONA 1 SBPC/ML 9000/9001 Accredited (CBR) (CBR) laboratorial accreditation Graph 8 Scientific production by Abramed’s associates (2017-2019) Source: Abramed Panel. 24 Painel Abramed | Institutional profile 21 Authorship of books and / or chapters of national and international books 40 Papers presented in INTERNATIONAL congresses 194 (includes oral presentations such as classes, 203 and lectures, and printed or electronic poster) 237 Papers presented in NATIONAL congresses 393 (includes oral presentations such as classes, 431 and lectures, and printed or electronic poster) 437 486 Publications indexed in 100 200 300 490 638 magazines and periodicals 2018 2017 600 700 400 500 0 2019

204 Abramed’s associates invest in the development of new business modelos, especially with startups that offer products for the health market. It is Worth mentioning that 42.3% of the associates are part of the new business models, able to help in the diagnosis man- agement (internal control and op- erational procedures). And 30.8% of the associates take part in de- veloping apps for smartphones. Graph 9 Participation in new business models (2019) Source: Abramed Panel. 26.9% 26.9% 26.9% 23.1% 42.3% 30.8% 7.7% Abramed Panel | 2020 Diagnosis Development of Health Therapeutical Startup Startup except Fertilization management applications (Apps) management procedures for diagnosis diagnosis Despite the sector’s invest- vested can be even bigger and ments in business models as- depends essentially on the eco- socaited with the diagnosis, nomic conditions and, mainly, on Abramed’s associates develop the questions related to the tax- or invest in other models on the ation in the sector, which in many health sector. It is importante times invalidates any productive to highlight that the amount in- investment in the country.

Graph 10 Development or investment in startups as business model in other segments of medicine (2019) Source: Abramed Panel. 205 69.2% 30.8% Yes No Every year the associates invest in duce the waste in the sector. In this mat- the development of apps for smart- ter, 92.3% of the associates have an app phones, aiming to offer more comfort for exams results (medical report). In and practicality to patients. In addition comparison to the previous year, there to that, expandig the access to exams was a significant increase in the offer results contributes to significantly re- this set of apps. Graph 11 Applications available for patients at Painel Abramed | Institutional profile Abramed’s associates (2019) Source: Abramed Panel. 80.8% 92.3% 76.9% 42.3% Exams results Service units Exams Vaccine (reports) (accredite network) scheduling monitoring

206 The diagnostic medicine sec- tive clinical management. It is pos- tor changes and evolves constantly sible to notice a bigger number of through technological innovation in Abramed’s associates that adapt to softwares and management systems. these technologies, especially BI soft- Abramed’s associates invest in these wares – Business Intelligence, used Technologies to promote solutions by 92.3% of the associates. Invest- capable of delivering a greater value ing in data integration from a number to their patients. Through these Tech- of care segments is a growing trend, nologies it is possible to analyze im- and it aims to provide the much de- aging and laboratory exams in a more sired integration that generates effi- efficient way, and enable more asser- ciency in the health system. Graph 12 Softwares & management systems (2019) Source: Abramed Panel. 88.5% 92.3% 88.5% 73.1% 65.4% 57.7% 46.2% 3.8% Abramed Panel | 2020 BI Service PACS RIS ERP LIS LIS or RIS Others (Business Systems (Picture Archiving (Radiology (Enterprise (Laboratorial integrated with Intelligence) and Communication Information Resource information HIS (Hospital System) System) Planning) system) information system) The number of collection units in the North region. Laboratory exe- have totaled 1,481 in December, 2019 cution centers have totaled 82, high- and it kept its growing path in com- lighting the Southeast region, with parison to the previous year, except 47.6% of the total number of units.

Graph 13 Colletion centers Source: Abramed Panel. 207 1,382 1,430 1,481 699 725 732 243 254 262 218 221 251 193 201 209 South Midwest Northeast 29 29 27 Southeast Total North 2018 2019 2017 Graph 14 Laboratory execution centers Source: Abramed Panel. 82 Painel Abramed | Institutional profile 76 63 37 39 33 14 12 12 10 335 Southeast 13 14 Total 8 11 Northeast North 2019 2020 7 Midwest 2018 South

208 The imaging centers have totaled other regions. This was also observed 472 units in 2019 and show a growth in relation to the number os laboratory trend, specially in the Southeast re- units providing services in the hospi- gion, remaining pratically steady in tals, which totaled 253 units in 2019. Graph 15 Imaging centers Source: Abramed Panel. 373 392 337 472 448 407 8 11 12 39 42 43 12 10 11 Southeast 11 12 14 Total Midwest Northeast North 2018 2019 South 2017 Graph 16 Laboratories providing services in hospitals Source: Abramed Panel. 244 248 253 Abramed Panel | 2020 172 175 178 11 13 14 37 33 30 000 Southeast 24 27 31 Total Midwest Northeast North 2018 2019 South 2017

209 The associates have followed the techno- ment is the most presente in the diagnostic logical evolution of the equipments for ima- medicine imaging sector, totaling 1,914 units ging diagnosis. These new technologies allow in 2019, considering the group of Abramed’s the performance of increasingly accurate associates. The magnetic resonance and CT exams, in addition to generating many infor- Scan equipment have totaled 485 and 251 mation for the diagnosis. Ultrasound equip- units, respectively. Graph 17 Number of equipments Source: Abramed Panel. Painel Abramed | Institutional profile 1,830 1,872 1,914 450 467 485 222 236 251 325 338 349 240 268 293 130 159 184 80 91 102 75 82 84 Magnetic Analog Digital Gamma Ultrasound resonance CT SCan Mammography Bone 29 31 33 X-ray X-ray camera densitometry PET/CT 2017 2018 2019

210 Human resources In 2019, the diagnostic medicine sector have employed more than 264.2 thousand people in the many activities that envolve the diagnosis process, especially in clini- cal laboratories – which concentrate almost half of the contracts of the sector. It is a multidisciplinar and labor-intensive sector, covering professionals with diverse med- ical and technical specialties. In the last year, Abramed’s associates have employed more than 66 thousand people with a formal labor contract. The hiring pace was less intense than in 2018, still resulting in a positive balance of 2.9 thousand direct Jobs. The structure and distribution of employees varies according to the asso- ciates segment in the diagnostic medicine sector. Overall, there is a higher proportion of employees in the activities related to business administration. On the other activities, there is a high proportion of nurses, nursing techni- cian, biomedical and pathology technicians. Graph 18 Number of hiring and layoffs Source: Abramed Panel. Designed by Abramed. + 4.4 thousand 20,000 + 2.9 thousand Abramed Panel | 2020 15,000 2018 2019 + 2.6 thousand Hiring 10,000 5,000 0 2017 Layoffs

Graph 19 Proportion of employees by type of activity performed (2017-2019) Source: Abramed Panel. 211 37% 34% 35% 14% 13% 13% 11% 11% 11% 10% 9% 10% 3% 4% 3% 3% 3% 3% 2% 2% 2% 3% 3% 3% 2% 1% 1% 2% 2% 1% Hospitality Pharmacist Administrative Physicians Nurses Nurses Imaging Biomedics Biomedic, Clinical (technicians) Technicians that work biologist or pathalogy with imaging pharmacist technicians exams that works 2017 2018 at OTC 2019 The diagnostic medicine sector needs technical qualification and proper edu- cation for the development of its activities. It is possible to notice that 70% of the employees have an specific or technical education. Graph 20 Proportion of employees by level of education (2019) Source: Abramed Panel. 3% 30% Painel Abramed | Human resources 9% 11% 14% Elementary school 30% Graduate/MBA Masters Degree Technician Highschool University Degree

212 The fixed-variable (performance) re- Fixed+variable is muneration was the main model used the main model for paying doctors at Abramed’s asso- used in the ciates in 2019, and it presented a slight remuneration increase in comparison to the previous of doctors. year. On the other hand, the fixed model increased going from 28.8% to 29.1%, while the variable (performance) went from 23.2% to 22.3%. The evolution in new remuneration models is essential to the sustainability to the supplementary health sector and requires na ongoing conversation. However, in the short- -term, adopting new models may be dif- ficult because of legal issues. Graph 21 Remuneration model – Physicians Source: Abramed Panel. 50.1% 48.0% 48.6% 28.8% 29.1% 24.2% 23.2% 22.3% 25.7% Abramed Panel | 2020 Fixed Variable (performance) Fixed + Variable (performance) 2017 2018 2019 The most common hiring contract among cians, hiring through work cards (CLT) predo- doctors is through legal entities, with an 89.5% minates with 99.7%. Among biomedics 100% of of participation in 2019. Regarding the techni- the hirings are through work cards (CLT).

Graph 22 Distribution of physicians Graph 23 Distribution of technicians by hiring regime (2019) by hiring regime (2019) Source: Abramed Panel. 1.8% Source: Abramed Panel. 0.3% 213 8.7% 89.5% 99.7% Work card Legal Entity (PJ) Cooperative Work card Cooperative Graph 24 Physicians with specialty title (2019) Source: Abramed Panel. 90.7 89.0 Painel Abramed | Human resources 88.2 2017 2018 2019 (%) Physicians with specialty title

Abramed Panel | 2020214 8,086 doctors working in the various specialties of diagnosis. Abramed associates employed 8,086 physicians in 2019, distributed in the areas of Radiology and Imaging Diagnosis (7,209); Clinical Analysis (316); Endos- copyand colonoscopy (347); and Pathological Anatomy (214). In total, there was a 2.1% increase in hiring between 2019 and 2018, especially in the Imaging Diag- nosis segment. The number of x-ray technicians totalled 2,233 and maintained the downward trend observed last year, with a reduction of 3.4% between 2019 and 2018. Despite the fall, the pace was slower in comparison with previous years.

Graph 25 Number of doctors according to specialty (2019) 215 Source: Abramed Panel. 7,603 7,920 8,086 Note: Logarithmic scale graph. 10,000 6,820 7,017 7,209 1,000 273 313 316 283 347 347 227 243 214 100 10 1 Clinical Endoscopy and Pathological Total Diagnostic analysis colonoscopy anatomy imaging 2017 2018 2019 Graph 26 Number of x-ray technicians Source: Abramed Panel. 2,424 2,311 Painel Abramed | Human resources 2,233 2017 2018 2019

216 Care production Abramed’s associates have performed market. The most performed exams were con- mora than 516 million diagnostic exams in 2019, centrated in the clinical analysis segment, with which representes around 56.4% of the total of 490 million exams, while the imaging exams exams performerd in the supplementary health have totaled 19 million. Graph 27 Number of exams performed by specialty (values per Thousand) Source: Abramed Panel. 516,835 Note: Logarithmic scale chart – base 10. 480,625 433,222 Total 490,342 456,367 Clinical analysis 411,871 Imaging diagnosis Pathological anatomy 19,942 Graphic methods 18,331 16,353 Genetics Molecular biology 4,375 Endoscopic method 3,988 Nuclear medicine 3,317 Abramed Panel | 2020 1 10 749 10,000 100,000 1,000,000 681 2017 652 534 517 421 460 344 231 434 398 377 139 137 175 100 1,000 2019 2018 The complementary exams provide a guidelines, patients and doctors will have the group of information used to diagnosis or dis- best available information to help in the de- miss specific health problems in a specific pa- cision making process for the best course of tient. When performing an exam in a rational treatment. Therefore, the diagnostic process way and according to clinical protocol and plays a crucial role in the patient care cycle.

Graph 28 Number of exams perfomed in Supplementary Health, Abramed’s associates (values per thousand), and market share Source: Abramed Panel. 916.5 100% 217 90% 1,000 56.4% 80% 516.8 70% 900 861.5 60% 50% 816.9 40% 30% 800 20% 10% Number of exams (values per thousand) 700 55.8% 0% Market share – Abramed 480.6 600 53.0% 500 433.2 400 300 200 100 0 2018 2019 2017 Supplementaty health Abramed Market share Regarding the proportion of the imaging exams performed, it is possible to notice that CT Scan and magnetic resonance represent nearly 36.3% of the total number of exams performed in 2019. Graph 29 Participation of selected imaging exams (2019) Source: Abramed Panel. 20.9% Painel Abramed | Care production CT Scan 20% 25% Magnetic resonance 15.4% 11.5% Ultrasound 10% 15% Densitometry 5.9% Ecocardiogram 2.9% Fetal medicine 1.8% 0% 5%

Graph 30 Average number of exams by diagnosis specialty 218 Source: Abramed Panel. 10.9 11.4 11.2 1.2 1.2 1.6 1.5 1.4 1.5 1.3 1.4 1.4 1.5 1.3 1.2 1.2 1.2 1.2 1.6 1.7 1.7 1.3 1.2 1.2 1.0 1.0 1.0 Clinical Pathological Imaging Teleradiology Endoscopic Graphic Genetics Molecular Toxicology Nuclear analysis anatomy diagnosis method methods 2019 biology medicine (including x-ray) 2017 2018 The patients’ no-attendance Graph 31 No show – no attendance rate rate regarding imaging exams in imaging diagnosis exams that were previously scheduled Source: Abramed Panel. (no show) was of 15.9% in 2019, 15.9% which maintains the growth 13.7% 15.3% trend observed in 2017. This per- Abramed Panel | 2020 centage can vary according to 2017 2018 2019 the type of exam and indica- tes that, on average, out of 100 The number of medical reports accessed via electronic scheduled exams at determi- ways has nearly totaled 91.3 million, which corresponds to 17.7% ned place and time, 15 do not of the total in 2019. This is a sectorial trend that grows as new happen due to no show. This technologies for sharinf data become available, making it ea- way, the physical and human re- sources planned for performing these services are not properly used. As result of it, the cost of exams can increase significantly as these resources become stranded. The patient’s partici- pation in the care cycle is crucial to avoid increasing the cost and the waste in the health sector.

Graph 32 No show – no-attendance rate in diagnostic exams by type of exam Source: Abramed Panel. 13.6 219 11.4 CT Scan 17.8 X-ray 13.9 23.0 24.0 Fetal medicine Ecocardiogram 20.4 Densitometry 17.6 Mammography Ultrasound Magnetic resonance 5.0 10.0 15.0 20.0 25.,0 30.0 2019 2018 2017 sier both patients and doctors to access informa- show as “not accessed.” There is a estimate that tion. In this matter, a series of exams are accessed this number is even higher and its measurement only by the doctors or medical team responsible in a complete way comes up against the intero- for the patient’s follow up, causing the exams to perability of some data systems. Graph 33 Number of reports accessed through the internet (values per 1,000) Source: Abramed Panel.82,561 Note: Logarithmic scale chart – base 10.83,410 91,303 100,000 Total 80,852Clinical Imaging Pathological Graphic Endoscopic Nuclear Genetics 10,000 81,337analysisdiagnosis anatomy methods method medicine 1,000 88,266 1,407 100 1,727 10 2,619 1 157 180 231 107 127 143 26 27 29 10 11 11 1 2 3 Painel Abramed | Care production 2017 2018 2019

Considering the group Graph 34 Number of reports not accessed or of clinical analysis and im- withdrawn (thousands) aging exams at Abramed’s Source: Abramed Panel. 220 associates in 2019, the number of medical reports not accessed or withdrawn 12.3 13.6 13.9 15.9 16.6 has totaled nearly 21.4 mil- 14.4 lion and representes 4.1% of the total. Despite the nom- 2.1 2.3 2.7 inal increase, the participa- tion of these exams over Imaging Clinical analysis Total the total performed re- 2019 mains at the same previous 2017 2018 level, 4.0%. ages, it is possible to no- get older, while for men this The clinical analysis and tice a smaller proportion of proportion is high until 65 imaging diagnosis exams exams by women as they years old. are usually more frequent as of 25 years old for men and 15 years old for women. Even though there is a big- ger proportion of imaging exams performed in lower Graph 35 Male – Proportion of clinical analysis and imaging exams by age group (2019) Source: Abramed Panel. 10.0% 9.0% 9.0% 8.0% 8.0% 7.0% 7.0% 6.0% 6.0% Abramed Panel | 2020 Clynical Analysis Imaging 5.0% 5.0% 4.0% 4.0% 3.0% 3.0% 2.0% 2.0% 1.0% 1.0% 0.0% 0.0% Up to 1 to 4 5 to 9 10 to 14 15 to 19 20 to 24 25 to 29 30 to 34 35 to 39 40 to 44 45 to 49 50 to 54 55 to 59 60 to 64 65 to 69 70 to 74 75 to 79 80 years 1 year or more Clinical analysis Imaging

Graph 36 Female – Proportion of clinical analysis and imaging exams by age group (2019) Source: Abramed Panel. 12.0% 221 12.0% 10.0% 10.0% 8.0% 8.0% Clynical Analysis6.0% 6.0% Imaging 4.0% 4.0% Painel Abramed | Care production 2.0% 2.0% 0.0% 0.0% Up to 1 to 4 5 to 9 10 to 14 15 to 19 20 to 24 25 to 29 30 to 34 35 to 39 40 to 44 45 to 49 50 to 54 55 to 59 60 to 64 65 to 69 70 to 74 75 to 79 80 years 1 year or more Clinical analysis Imaging Women have performed, Graph 37 Proportion of exams performed by gender on average, 70.9% of the ima- ging exams and 64.5% of Source: Abramed Panel. clinical analysis exams at Abra- med’s associates in 2019. This 29.1% 35.5% active female participation is linked to prevention measures and periodical exams. 70.9% 64.5% Imaging Clinical analysis Men Women

222 The future of diagnosis and cancer treatment Abramed Panel | 2020 I n the last decades, a se- tumor delivery – which com- ries of technological and prises a series of nanometric scientific advances have solutions for diagnosis; liquid happened in order to im- biopsy – that detects it through prove the diagnosis and treat- a blood test; molecular imag- ment of cancer in the world. ing – using biomarkers for a These advances offer a new more accurate diagnosis. perspective for facing the dis- ease, as early detection in- During treatment, the main creases the chances of cure technologies are: celular ther- and may considerably reduce apies – aiming to replace and the cost of the treatment. activate the patient’s imune system and attack directly the The report of the research51 cancer cells; cancer vacines – carried out by the Center of devolped from the patient’s Strategic Studies from Fiocruz genome sequencing; genetic has pointed out many tech- edition – consisting of chang- nologies that will be very use- ing the DNA of an organismo; ful in facing cancer in the next RNA based therapies; immuno- 30 years. The information were therapy – using oncolytic virus obtained through a worldwide and antibodies from treating research about scientific peri- cancer. odics and researchers special- ized in oncology. In spite of these advances, the future expectations in fac- The results of the research ing cancer find some obsta- suggest a revolution in patient cles, especially related to the care by using new early de- costs of developing such Tech- tection technologies, such as: nologies, considering the un- 51. Expected future of cancer care (2017-2037).

certainty in face of the high poting new diagnosis technol- 223 financial investments neces- ogies point to a greater chance sary for research and develop- of success through molecu- ment. Additionally, there are a lar imaging and liquid biopsy. series of conversations around While during treatment, the the ethic issues and the use of perception is that success will genetic testing to foresee dis- be more likely by using thera- eases and predisposition for pies related to antibodies and the development of cancer in tumor delivery. In Brazil, this the Society. perception in the treatment indicates a greater efficacy The expectations about the using the antibodies and cellu- probability of successfully ado- lar therapies. Graph 38 Perception of the probability of impact in adopting new cancer diagnosis Painel Abramed | The future of diagnosis and cancer treatment and treatment technologies in the next thirty years (2017-2047) Source: Expected future of cancer care (2017-2037). Adapted by Abramed. 47.9 Oncolyctic virus -13.5 RNA Therapy -11.3 48.7 Gene editing -7.2 67.2 Liquid biopsy -6.4 77.1 Cancer vaccines -5.2 71.8 Tumor delivery -2.7 82.8 Antibody therapies -2.2 85.1 Molecular imaging -2.1 82.4 Cell therapies -0.4 20 40 60 74.8 100 -20 0 Likely (%) 80 Unlikely (%)

224 Graph 39 Perception of the impact in adopting technologies in cancer diagnosis and treatment until 2049 (% – Brazil) Source: The fututre of cancer diagnosis and treatment in Brazil (2019-2049). Adapted by Abramed. Oncolyctic virus 76.9 19.3 3.7 0.1 RNA therapy 34.7 37.9 23.9 3.5 Gene editing 50.5 33.6 14.0 1.9 Liquid biopsy 63.7 22.1 12.9 1.4 Cancer vaccines 51.0 34.8 12.9 1.3 Tumor delivery 51.6 36.5 10.9 1.0 Antibody therapies 48.8 35.9 13.6 1.7 Molecular imaging 67.8 22.4 8.8 1.0 Cell therapies 36.4 38.3 20.3 5.0 0.0 10.0 20.0 30.0 40.0 50.0 60.0 70.0 80.0 90.0 100.0 High Medium Low None Even in face of the scientific and cure for cancer can be found in this technological advances, the cure period. This perception can vary as for cancer is unlikely in the next 30 the scientific studies move forward years. This is the perception of 57% in a short or mid-term, and it also of the researchers questioned about depends on the level of knowledge the probability of cure, while 6% be- of every researcher around the new lieve that is highly likely that the developing technologies. Graph 40 Perception about the probability of the cure for cancer in the next 30 years (2017-2047) Source: Expected future of cancer care (2017-2037). Adapted by Abramed. 57 60 Unlikely 50 Abramed Panel | 2020 40 Probability (%) 30 22 4 20 10 Unknown 10 6 Likely Very little likely 0 Highly likely



226 Service evaluation In 2019, the use of Net Promoter results represent a high level of pa- Score (NPS) at Abramed’s associates tient’s satisfaction and indicates that was of 83.8 representing an improve- they will keep using and recommend- ment in the patient’s evaluation in the ing the diagnostic service. diagnostic medicine services. These Graph 41 Level of customer satisfaction – Net Promoter Score (NPS) Source: Abramed Panel. 83.8 82.9 80.9 Abramed Panel | 2020 2017 2018 2019 Net Promoter Score (NPS) The improvement of service tions and accreditations, and the quality in the diagnostic medicine consolidated result points to a spe- can be reached by using processes cific compliance rate for the compo- of accreditation and certification, sition of the data from the Abramed among other objective and impar- Panel. Every year this rate shows an tial evaluation processes. In general, improvement and in the end of 2019 the associates have many certifica- it was 96.0%.

Graph 42 Compliance rate (%) 227 Source: Abramed Panel. 96.0 93.6 91.9 2017 2018 2019 In 2019, 88.5% of Abramed’s as- this kind of evaluation is part of the re- sociates have performed some kind quired criteria for many accreditations of satisfaction survey with their clien- and certifications. tes. It is importante to emphasize that Graph 43 Percentage of associates that have performed satisfaction Painel Abramed | Service evaluation surveys with patients in the last three years Source: Abramed Panel. 84.6% 88.5% 84.6% 15.4% 15.4% 11.5% 2017 2018 2019 Yes No

228 Graph 44 Percentage of associates that have performed satisfaction surveys with doctors in the last three years Source: Abramed Panel. 69.2% 61.5% 61.5% 38.5% 38.5% 30.8% 2017 2018 2019 Yes No The evaluation of suppliers pre- imaging equipment maintance, which sentes a gradual improvement and showed a worse result in comparison can be classified as satisfactory in all with the previous year. items assessed. With the exception of Graph 45 Service evaluation Abramed Panel | 2020 Source: Abramed Panel. Maintenance Suppliers Hygiene and Physicians Physicians of laboratory cleaning services (third parties) (in-house) 10.0 equipment 8.0 6.0 4.0 2.0 0.0 Maintenance of imaging equipment 2017 2018 2019

229 The evaluation of paying sources through selected in- dicators presents regular re- sults. There was a worsening in the criteria for contractual readjustement and for ex- change of information in the care production. On the other hand, in 2019, there was a perceptio of improvement in the situations of termination and contract renewal. Graph 46 Evaluation of the paying sources Source: Abramed Panel. Contract Contract Information Painel Abramed | Service evaluation termination renewal exchange in the care 10.0 2017 2018 8.0 2019 6.0 4.0 2.0 0.0 Contractual adjustment criteria

Economic and financial 230 performance In 2019, the gross operating revenue of In supplementary health, the healthcare Abramed’s associates have totaled nearly expenditure with complementary exams R$ 13 billion and grew 6.2% in comparison have totaled R$ 36.0 billion and increased to the previous year. This increase reflects 7.2% in comparison with 2018. This amount the process of expanding the offer of labo- represents 20.8% of healthcare expendi- ratory services, genetics, image and other ture in the market. It is important to high- diagnostic segments through the expan- light that the growth pace in the expenses sion of new business units. This increase with exams was of 7.4% per year, while have occurred despite the stagnation of healthcare expenditure in the sector grew the Brazilian macroeconomic scenario, 7.8%, with an emphasis on the variation in with a high unemployment rate and stabil- expenses with hospitalizations of 9.1% and ity in the number of beneficiaries of health- therapies 16,3%, on average per year, be- care plans. tween 2015 and 2019. Graph 47 Receita bruta segundo faixa de valor das associadas Abramed (2019) Abramed Panel | 2020 Source: Abramed Panel. 19.2% Up to 10 23.1% >10<=20 7.7% >20<=50 11.5% 15.4% >100<=250 >250<=500 3.8% >750<=1.000 >1.000<=2.000 11.5% >2.000<=5.000 7.7%

Graph 48 Revenue by value range (2019) Source: Abramed Panel. 231 15.3% 84.6% Up to 1 billion Above 1 billion Considering the revenue according to the diagnostic segment, in 2019 there was Painel Abramed | Economic and financial performance a participation of 65.9% in clinical analysis exams and 34.1% in imaging exams, and it has remained stable in the last three years. Graph 49 Revenue by diagnostic segment (2017-2019) Source: Abramed Panel. 34.4% 34.3% 34.1% 65.0% 65.7% 65.9% 2017 2018 2019 Clinical Analysis Imaging

232 Private health plans and The main source of income insurance are the main for Abramed’s associates comes source of income for the from private health plans and in- associated companies. surance, with an average partic- ipation of 80.9% in 2019. Direct payments made through private means represent 13.2% of the sec- tor’s revenues and 5.9% from pub- lic sources. Graph 50 Revenue sources Source: Abramed Panel. 6.2% 5.9% 13.5% 13.2% 6.1% 13.3% 80.6% 80.3% 80.9% 2017 2018 2019 Public Private Healthcare plans (SUS, OS, and other (patient that pays directly (operators and public entities) to the service unit) health insurers) Abramed Panel | 2020 Each year, the diagnostic medicine sector seeks new ways of relating to healthcare plan operators, providers, suppliers, among other agents working in the medical sector. In this sense, it constantly seeks to format and adapt the services offered in convergence with the remuneration models capable of guaranteeing better patient care and safety. It is necessary to assist in the sustainability of the sector through re- muneration models that value the care outcome. Each year there is an in- creasing participation of models used as an alternative to Fee For Service such as the Global Budget and the Bundle Payment.

Graph 51 Compensation model (2019) Source: Abramed Panel. 233 7.7% 80.8% Fee for service (per procedure) 11.5% 19.2% Global budget 11.5% Bundle Payment Mixed models 19.2% DRG – Diagnosis Related Groups 19.2% Capitation P4P – Pay-for-performance In 2019, there was a deceleration in the pace of investments in the acqui- Painel Abramed | Economic and financial performance sition of capital goods, resulting, on average, in 8.2% of the gross revenue of Abramed’s associates. This lower result compared to the previous year is due to the uncertainties in the economic scenario observed throughout the year. Graph 52 Investment in capital goods – % Capex Source: Abramed Panel. 12.1 8.2 8.6 2017 2018 2019

Graph 53 Distribution of investment 234 Source: Abramed Panel. Logistics Research and development Certification acquired Personal Qualification Real State / Renovations TIC (Communication and Information Technologies) Machines and equipments 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% 2019 2018 2017 Abramed Panel | 2020 The main investments were directed to the acquisition of machines and equipment for imaging and diagnosis, expansion and improvement of service units, and information and communication technologies. The distribution of expenses and costs shows that the payroll represented, on average, 30.9% of the total, while the technical and operational contracts repre- sented about 10.9%, in the last three years. Together, these items correspond to most of the labor costs used at Abramed’s associates. Material expenses repre- sent 17.8%, support and logistics contracts 6.2%, and other operating expenses 11.7%, on average. The average collection period according to the category of operator was of 60.5 days, on average, in the last three years, considering the main modal- ities: Medical Cooperatives, Medical Group and Specialized Health Insurers. This is the average collection period that an associated receives for providing the service performed to the beneficiary of the healthcare plan. This is an ex- tremely long period and may indicate that part of the operators’ financing is carried out with third party resources. It is importante to highlight the period of 59.8 days for Medical Groups, 56.4 for insurance companies and 54.6 for medical cooperatives.

Graph 54 Distribution of expenses and costs Source: Abramed Panel. 235 35.0% 30.0% 25.0% 20.0% 15.0% 10.0% 5.0% 0.0% Medication Materials Medicinal Other Utilities Maintenance Operational Support Depreciation Financial Other gases supplies and technical and technical and logistics expenses operational Personnel assistance contracts contracts expenses cost (payroll) 2017 2018 2019 Graph 55 Average payment period according to operator category (in days) Painel Abramed | Economic and financial performance Source: Abramed Panel. 56.8 62.5 63.7 58.8 56.9 56.4 59.8 60.1 59.2 58.9 49.9 45.9 54.6 50.2 45.3 Self-management Medical Philanthropy Medical Group Specialized Cooperative Health Insurer 2017 2018 2019

Graph 56 Average payment period after undue Disallowance, according to the operator category (in days) Source: Abramed Panel. 236 192.7 188.7 186.3 194.8 192.5 201.5 202.3 174.1 173.3 176.7 164.4 163.6 158.6 155.6 157.4 Self-management Medical Philanthropy Medical Group Specialized Cooperative 2018 2019 Health Insurer 2017 Abramed Panel | 2020 Initial disallowance As of this edition of the rate was 4.7%, final Abramed Panel, the disallowance disallowance 3.5% and index will be presented consid- not paid disallowance ering the initial disallowance (fi- 3.3% in 2019. nancial amount with disallowed grounds), final disallowance (pay- ments made after the verification of the undue disallowance in rela- tion to the initial disallowance) and unpaid disallowance (disallowed amounts and that were not paid in the year). According to data from Abramed’s associates, there is a worrying trend in the growth of the disallowance index in the last three years. In general, the initial disallowance corresponds, on av- erage, to 4.3% of revenues, while the final disallowance was 2.8% and the unpaid disallowance of 3.3% in the same period. These in- dices can vary according to size and operator mode.

Graph 57 Disallowance index (monthly avergae – %) Source: Abramed Panel. 237 4.7 4.1 4.2 3.5 3.3 2.9 2.2 2.0 1.7 Initial Final Non-paid disallowance 2017 2018 2019 Graph 58 Inital disallowance index by category of healthcare Painel Abramed | Economic and financial performance medical-hospital plan operator (monthly average – %) Source: Abramed Panel. 5.4 4.3 4.2 3.5 2.2 Self-management Medical Philanthropy Medical Group Specialized Cooperative 2018 2019 Health Insurer 2017

238 Corporate governance Abramed’s associates are com- (IBGC), in addition to the ones pro- mitted in maintaining high standards vided at the Brazilian Corporation Law. of corporate governance, structured under principles of transparency, qual- The associates work intensively ity policies and internal controls. To- to comply with the Brazilian Gen- gether, these pillars are of relevant eral Data Protection Law (LGPD), and importance in the sustainability of the about 20% of them are already fully associates. It is possible to observe that compliant with the Law, while the rest a group of Abramed’s associates have are working in the more advanced practices recommended by the Brazil- stages to comply with the law within ian Institute of Corporate Governance the expected deadline. Graph 59 Situation of companies according to LGPD processes – Brazilian General Data Protection Law (2019) Source: Abramed Panel. 92.3% 92.3% 88.5% 88.5% 92.3% 88.5% 84.6% 80.8% 80.8% 73.1% Abramed Panel | 2020 26.9% 15.4% 11.5% 11.5% 19.2% 19.2% 7.7% 7.7% 7.7% 11.5% Compliance Data Personal Audit on Consent Managemen Impact Data Treatment Communication Committee Protection data Treatment and Management of the holder's report Security Governance Plan Security Due Anonymization requests requestst Officer Incident (Clerk) Diligence Partially Completely

239 Graph 60 Percentage of associates that have internal controls for operational assurance, accounting records and law and regulation compliance (2019) Source: Abramed Panel. 92.3% 92.3% Painel Abramed | Corporate governance 84.6% 15.4% 7.7% 7.7% Ensure operational Ensure compliance with Ensure the reliability of efficiency and accounting records rules and laws effectiveness Partially Completely

240 Graph 61 Percentage of associates have policy and training on fraud prevention (2019) Source: Abramed Panel. 57.7% 61.5% 42.3% 38.5% Fraud Prevention Policy Training on Fraud Prevention Partially Completely Graph 62 Percentage of associates with manuals and established procedures (2019) Source: Abramed Panel. Abramed Panel | 2020 0.0% 100.0% Partially Completely

Graph 63 Percentage of companies that a policy disclosure and transparency established (2019) Source: Abramed Panel. 241 73.1% 26.9% Partially Completely Graph 64 Percentage of companies with a responsible sector for internal audit (2019) Source: Abramed Panel. 65.4% 34.6% Painel Abramed | Corporate governance Partially Completely

242 Graph 65 Percentage of associates with an administrative board with a family and/or independente structure (2019) Source: Abramed Panel. 69.2% 65.4% 34.6% 30.8% Independent Familiar Partially Completely Graph 66 Percentage of assocaites with specific committee for audit, risks, human resources, social responsability, finance, innovation, strategy, succession and remuneration (2019) Source: Abramed Panel. 80.8% 80.8% 73.1% 73.1% 73.1% 69.2% 57.7% 65.4% 61.5% Abramed Panel | 2020 42.3% 34.6% 38.5% 26.9% 30.8% 26.9% 19.2% 19.2% 26.9% Audit Risks Human resources Social and Finance Innovation Strategy Sucession Remuneration and personnel Corporative Responsability Partially Completely

Graph 67 Percentage of associates with established code of conduct (2019) Source: Abramed Panel. 243 92.3% 7.7% Partially Completely Graph 68 Percentage of associates with established with a reporting channel (2019) Source: Abramed Panel. Painel Abramed | Corporate governance 80.8% 19.2% Partially Completely

Abramed Members



246 Abramed Panel | 2020 Founding year: 1955 The Brazilian Albert Einstein Israelite Charitable Society is a Areas of expertise: non-profit civil society active in Clinical Analysis, Imaging Diagnosis, supplementary and public health, Pathological Anatomy and Genetic Testing education, research, innovation, consulting and social responsibil- Geographic coverage: ity. The structure of supplemen- SP, RJ, GO, MG, PR, ES, PA, PE and DF tary health services is formed by 12 units, 11 of which in the state Number of Units: 38 of São Paulo. In public health, the organization has 26 units in Number of employees: 16,987 the municipality of São Paulo. In teaching, it comprises 8 units in Number of patients treated per year: São Paulo, Curitiba, Rio de Ja- 6,785,438 laboratory and imaging examinations neiro, and Belo Horizonte. performed in supplementary health and 3,091,341 by the Unified Health System (SUS). It is also responsible for the management of the Órion Hospi- Number of brands in operation: 1 tal in Goiânia and operates clinical analysis and imaging laboratories, which serve public and supple- mentary health in the states of SP, RJ and GO.

Albert 247 Einstein Medicina Abramed Members Diagnóstica In 2019, Einstein inaugurated the Technical Operational Nucleus (NTO). The automation conveyor belt is a unique structure of its kind in the world, as it in- tegrates the biochemistry, immunology, hematology, coagulation, and molecu- lar biology laboratories. In the area of pathological anatomy, Einstein has made partnerships to process the tests of four hospitals in Rio de Janeiro and two in São Paulo (SP). A new sequencer has expanded the exams processing capacity of the ge- nomics laboratory by five times. In the clinical research field, Einstein has started to carry out, through the SUS Institutional Development Support Program (PROADI-SUS) with the Ministry of Health, the sequencing of the complete ge- nome. In 2020, 850 samples will be carried out. In a pioneering way, the Viroma/Metagenome test is being implemented, which improves the diagnosis of clinical conditions of undetermined origin, mainly new epidemics of unknown viruses. In partnership with the Government of Pernambuco and with facilities in Re- cife, Einstein began histocompatibility testing (HLA) for the solid organ and bone marrow transplant programme in September 2019.

Abramed Panel | 2020248 Founding year: 2011 Areas of expertise: Clinical Analysis, Imaging Diagnosis, Pathological Anatomy and other diagnostic methods Geographic coverage: MG, SP, BA, ES, PB, PA and MS Number of Units: 118 Number of employees: 5,900 Number of patients treated per year: 2 million Number of brands in operation: 14

249 Alliar médicos à frente Founded in 2011, from the merger of four leading companies in the imag- Abramed Members ing diagnosis sector in the cities of Belo Horizonte, Juiz de Fora, São José dos Campos and Campo Grande, the Alliar Group was established with a prominent position in the markets where it operates. The company is one of the largest diagnostic medicine companies in Bra- zil, recognized as Top of Mind in states such as Espírito Santo and Bahia. In addition, the company is growing in clinical analysis, reporting record share – 24% of revenue – and has signed a commercial exclusivity agreement with Israeli Medic Vision for the use of the IQMR product, which will allow for 20 to 40% faster MRI tests throughout Latin America. Among other outstanding features of the company are: the pioneering of the drive-thru method for Covid-19 tests, representing 93% of the new coro- navirus exams; the Alliar at Home Service, which generates higher monthly billing than the main physical unit; the iDr – exams performed remotely – doubling the number of contracts signed in comparison to last year, now representing 1.5% of revenue; and Machine Learning with significant produc- tivity gains in exams.