US Anesthesia Preliminary Table of Contents

Report Methodology 1

Definitions of Market Components 1

Segmentation By Type of Anesthesia Workstations 1

Market Size Determination Methodology 1

Installed Base 2

Growth Markets 2

Forecast Accuracy 2

Market Forecast Trends 3

Compound Annual Growth Rate (CAGR) 4

Alliances and Partnerships 4

Respiratory Gas and Vital Signs Monitoring Combinations 4

Anesthesia Workstation and Monitoring Equipment Alliances 4

US Implications of Datex-Engstrom Merger 4

Announcement that BOC Seeks to Sell Ohmeda 5

Market Segmentations For Report 5

Segmentation of New and Used Equipment - Reseller Market 5

Competitive Split/Market Shares - Ohmeda and NAD 5

Components of the Market 6

Accuracy of Data for Various Components 6

Market Modeling Approach 6

Potential For Fine Tuning the Study 7

Anesthesia workstations Pricing 7

Known Range or Error Remaining 8

Medical Price Inflation 8

Unit Volume Forecast 8

Equipment Replacement Cycle 8

Summary of the US Anesthesia Workstations Market 9

Issues Surrounding the Used Equipment Market 9

Issues Surrounding The Number of Instrumented ORs in FSSCs 10

FSSC Component of the Market 10

Animal Research Component of the Market 11

Hospital Component of the Market 11

Overview of US Healthcare Market Trends 13

Trends Affecting The Market Are LONG-TERM in Nature 13

Overview of US Hospital-Based Market Trends 13

Number of Operating Suites in US Hospitals 13

Trends in US Hospital Operating Suites 13

Procedures Shift To Same-Day Surgeries in Hospitals 14

Many Same Day Surgeries Performed Using IV Anesthesia 15

Trend in US Hospital Closures 16

Overview of Free Standing Surgical Centers (FSSC) 16

Overview of Outpatient Surgical Procedures Performed 17

Projection of ANESTHESIA WORKSTATIONS Required For FSSC 18

Vaporizers Used on ANESTHESIA WORKSTATIONS 18

Inpatient Setting - Number of Vaporizers 19

Outpatient Setting - Number of Vaporizers 19

Replacement Cycle for ANESTHESIA WORKSTATIONS 19

Specific Factors Which Might Accelerate Replacement Cycle 19

Bulk Phased Military Procurement Planned 19

Cycle Could Accelerate And Become Technology Driven - Given the Right New Product(s) 20

Patient Status Tracking Monitor 20

Logical Technology Integration 20

Number of Units Sold is Declining Very Slowly as Replacement Cycle Lengthens 20

Replacement Cycles of Other Anesthesia Workstations Components 21

Integrated Solutions Will Invigorate The Market 21

Methods of Differentiating New ANESTHESIA WORKSTATIONS in the US Market 22

Requirement For Information Systems in the Perioperative Surgical Setting 22

Perioperative Information Systems Market in US 22

Other External Market Drivers 24

Healthcare Expenditure Is a Political Issue 24

Managed Care Overview 24

Implications and Goals of Managed Care 24

Goals of Managed Care 24

Risk for Health Care Increasingly Shifting to Providers 25

Providers Form Managed Care Networks 25

Physician Specialties Threatened By Managed Care 25

Excess Supply of Specialty Physicians in US Managed Care Market 25

Over Supply Affects Many Specialties 25

Physicians Per 100,000 Population 26

Physicians By Specialty in US - Anesthesiologists in OFFICE Based Practices. 27

Perioperative Information Systems Needed to Manage the OR Resources and Costs 28

Outcome Measures Across the Continuum of Care 29

Focus of Peri-Operative Information Systems Shifts Under Managed Care 29

OR Information Systems Provide "Drill Down" Detail and Enforce "Critical Pathways" 30

Present Size of the OR Information Systems Market 30

Potential for Growth of OR Information Systems 31

Corporate Profiles 32

Andros 32

Location 32

Corporate History 32

Position in the Market 33

Products Offered 33

Breath Watch 34

Outlook 34

Aspect Medical Systems 35

Location 35

Corporate Background 35

History of Innovation 35

Position in the Market 35

Products Available 36

Outlook During Forecast Period 36

BCI International, Inc. 37

Contact Information 37

Corporate History 37

Position in the Market 38

Recent Product Additions 38

Other Products of Interest 39

Corporate Outlook 41

Criticare Systems 42

Contact Information 42

Selected OEM Relationships 42

Company Overview 42

Overview 43

Position In The Market 43

New Products 44

Other Products 46

Outlook 47

Datascope 48

Contact Information 48

OEM Relationships 48

Corporate History/Background 48

Product Announcements 49

Cardiac Assist Devices 49

Hemostat Products (Europe) 50

Patient Monitoring Products 50

Passport LCD and EL 50

Passport’s Newest Family Member 50

Central Station Systems 51

Multinex Monitor with/without Agent ID 52

Newest Product Introductions 53

Corporate Outlook 53

Hewlett-Packard Company Medical Products Group (MPG) 55

Key Personnel 55

Corporate History 55

Sales Force Structure Decentralized, Order Processing Centralized 57

World Wide Web 57

Integration/Interface to 3rd Party Products 57

History of Innovation 57

Key Accounts & Group Contracts 59

Interfaces to Competitive Products 59

Market Position - US and Worldwide 59

HP UNVEILS NEW FLEXIBLE-FINANCING PRODUCT SUITE 59

Patient Encounter Pricing 60

Total Cost of Ownership Study 61

Technology Protection Program 61

U.S. Pricing and Availability 61

HP Offers Upgrade Service Package for CMS Patient-Monitoring Customers 61

Fetal Monitoring 62

Patient Worn Telemetry 62

PorTable Monitors with Wireless LAN 62

Product Development Cycle 62

Products Overview 63

Telemetry Products 63

NEW - Viridia Telemetry - (HP Model M2600A) 63

Cardiology Products - Recent Additions 67

ICU and CIS Strengths 69

Component Monitoring System 70

CMS Bedside Monitors 70

Other CMS Components 70

Distributed Architecture 70

M-Series Parameter Modules 71

Greatly Enhanced Connectivity 72

Central Station Capabilities 72

Waveform Display 72

Alarm Identification 73

Documentation 73

Arrhythmia Monitoring 73

ST Segment Monitoring 73

Event Notification and Alarm Validation 73

Alarm Documentation 74

Beat Detection 74

Ventricular Fibrillation 74

Patients with Pacemakers 74

Trends 74

Full-Disclosure Capabilities 75

Digital Telemetry Products 76

Model M1275A Component Transport System 76

M3 – Transport Monitor (Not Available In The US Market) - Anesthetic Agent Products 76

Carevue Family of Clinical Information Systems 77

What is Carevue 9000? 77

Clinical Information System Market Position 77

HP Ultrasound Position 77

Fetal Monitoring Position 78

Intrapartum, Multiple Fetus Monitors 79

Electrocardiology Business Unit 79

Palm Vue System 79

HP Discount Strategy 79

Purchasing Group Contracts & Marketing Alliances 80

Service/support 80

Overall Outlook for HP 81

InVivo Corp. (Div. of Safetytek Corp). 82

Contact Information 82

Medical Division Location 82

Former Company Names: 82

EXECUTIVE OFFICERS OF THE COMPANY 82

Corporate History 82

Recent Financial Performance 82

RESEARCH 83

Position in the Market 84

History of Innovation 84

Recent Product Introductions 85

Omega 5600 86

Other Products Available 86

Millennia High-Acuity PorTable Monitor 86

Telemetry Option for Millennia 87

Recorder Option 87

Centurion Central Station 87

Model 4500 Plus 87

SVS 87

SCOUT 87

MRI Market 88

Outlook 88

MARQUETTE Electronics 89

Contact Information 89

Corporate History 89

Recent Acquisitions & Strategic Alliances 90

National Accounts 90

Position in the Market 90

Continued Development of Clinical Information Systems 90

Increase Penetration of International Markets 90

Patient Monitoring 91

Recent Product Additions 92

The Solar 8000, 92

Eagle Series 4000, 3000 93

Solar 1000 93

Newest APEX Transmitters 93

Patient Locating Devices 94

Established Products 95

Models 145, 150 & 155 95

Models 151, 118 & 340 95

Model 330 95

Unity Network Components 98

TramScope® Bedside Displays 98

Centralscope™ 12 Central Station 98

Direct Digital Writer (DDW) 99

Tram-Rac® Module Housings 99

Trim Knob® Remote Controls 99

Multi-Parameter Modules 99

SvO2 Module 100

Telemetry Module 100

Tram Bricks Available 100

Mentor™ User Support System 101

MARS™ Full-Disclosure Neonatal & Unity Workstations 101

Unity System Software 102

LAN Paging System 103

Alarm Display Unit 103

Monitoring Review Terminal (MRT-II) 103

Respiration and Anesthesia Care Products 103

Advantage™/Transcope® Interface (NEW) 103

MGA-1100 Monitor 104

Advantage/Lifewatch™ Plus 104

MGA-IR Mainstream and Sidestream Capnometers 104

Managed Use Program 104

Corporate Outlook 104

Nellcor/Puritan-Bennett/Mallinckrodt 106

Contact Information 106

Corporate History 106

Recent Financial Performance 107

Position in the Market 107

History of Innovation 107

Recent Product Introductions 108

New Nellcor PorTable (International Markets - OEM from Analogics, Inc.) 108

Nellcor UltraCap SA02 / ETC02 109

Established Products 109

OXIMETRY 109

CAPNOGRPHY 110

AGENT ANALYZER 110

BLOOD PRESSURE 110

N-1000 110

Outlook 111

NOVAMETRIX, Inc. 113

Location 113

Corporate Background 113

OEM Agreements 113

Recent Financial Performance 113

Corporate History 114

International Sales 114

Position in the Market 115

Products 115

The Big 5 115

Tele-Sat Model 116

Tidal Wave 116

OXYPLETH 116

Model 515B and Model 515C (with plethysmogram) 116

TCO2M Model 860 117

CO2SMO-Plus 117

Vent(Check) 117

VenTrak(R) Model 1550 118

COMPETITION (will stick this up there after you edit it) 118

Outlook 118

SIEMENS Medical electronics, Inc. (SME) 120

OEM Arrangements 120

Recent Financial Performance 120

Corporate Relationships 121

Corporate Restructuring 121

Position in the Market 121

Recent Additions 121

Bedside Monitors 121

Bedside Safety - Excellent, Unsurpassed! 122

Pods, Not Modules Anymore & A Simple, Intuitive User Interface 122

Docking Stations For Monitor and Recorder 123

A Trim Knob By Any Other Name - Enhanced With Dedicated Keys 123

This System Well Documented 123

In With the New, Out With the Old 124

Central Station is ViewStation 124

"Virtual" Mouse Pointers 124

Bedside Waveform Review At Central 125

Infinity Telemetry 125

National Accounts/Group Purchasing 126

Established Products 126

OR Products 126

Clinical Information Sytems (CIS) 126

Outlook 126

Spacelabs Medical, Inc. 127

Contact Information 127

Overview 127

Acquisitions 127

Recent Financial Performance 128

Product Warranties 128

Research and Development 128

Sales Strategy 128

Selected OEM Relationships 129

Position in the Market 129

International Markets 129

Patient Monitoring Markets 129

Telemetry Markets 130

Clinical Information Systems 130

Principal Products 131

Recently Introduced Or Acquired Products 131

PC Ranger 131

PC Scout 131

Fetal Monitor 131

Intesys Clinical Information System (New Chartmaster) is Care Master 132

Established Products 132

Universal Clinical Workstation (UCW) 132

Parameter Modules 132

UCW Scout Ranger 133

Models 90322 and 90323 Network Recorders 133

UHF Digital Patient-Worn Telemetry Products 133

2.4GHZ. WLAN For PorTable Monitor 134

Remote Data Access 134

Full Disclosure ECG Systems 134

Universal Flexport 134

Large Screen Remote Displays 135

Monitoring Network 135

Customer Support & Warranty 135

Competition 135

Outlook 136

Table/List of Figures and Tables

Table 1 - Total US NEW Anesthesiology Workstation Market Revenues, Units and Growth 9

Table 2 - FSSC Component of Market (Based on Growth & Replacement Units) 11

Table 3 - Trend in Operating Rooms and Gas Machines Sold (1990-1996) 12

Table 4 - Hospital Component of Anesthesia Workstation Market 12

Table 5 - Trend in Growth of US Hospital Operating Suites Since 1985 14

Table 6 - Five-Year Trends of Inpatient and Outpatient Surgeries in US Hospitals 15

Table 7 - Trend Over Last 5 Years of Number of US Hospitals 16

Figure 8 - Growth of Free Standing Surgical Centers and OR Suites in US 17

Table 9 - Surgical Procedures Performed in the FSSC Setting 17

Table 10 - Replacement Cycles for Perioperative Equipment 21

Table 11 - Physicians and Nurses By State 27

Table 12 - Physicians By Selected Specialty/Activity 28

Table 13 - Andros Recent Selected Financial Trends 33

Table 15 - Capabilities of Current BCI Products 40

Table 16 - Recent Siemens US Revenues - Patient Monitoring Products 42

Table 17 - Datascope Recent Financial Results 48

Table 18 - Selected DATASCOPE Product Innovations 49

Table 19- Selected DATASCOPE Monitoring Products 50

Table 20 - Recent Financial Performance 56

Table 21 - Selected HP Corporate Relationships 57

Table 22- Hewlett Packard Product Introduction 57

Table 23- Selected HP Medical Interfaces 59

Table 24 - HP Bedside Monitoring Displays Available 70

Table 25 - Some M-Series System Capabilities 71

Table 26- CMS Modules Currently Available 71

Table 28 - Invivo Recent Financial Performance 83

Table 29 - 1996 Quarterly Results 83

Table 30 - Invivo Product Innovations 85

Table 31 - Marquette Medical Recent Financial Results 90

Table 32- MARQUETTE History of Innovation 92

Model 330 Telemetry - Advanced Features for Convenience of Use: 96

Table 33 - Modules Compatible with Unity 100

Table 34 - Tram Modules and Their Capabilities 101

Table 35 - System Software Levels & Features 102

Table 36 - Features Common to ALL Software Versions 102

Table 37 - Recent Worldwide Nellcor Performance (Not including Mallinkrodt) 107

Table 38 - Nellcor History of Innovation 108

Table 39- Available Products from Nellcor 111

Table 40 - NOVAMETRIX Recent Financial Trends 114

Table 41 - NOVAMETRIX Monitoring Products 115

Table 42 - Recent Siemens US Revenues - Patient Monitoring Products 120

Figure 43 - Siemens Old and New Monitoring Product Line 124

Table 44 - SIEMENS Digital Infinity VHF, UHF "All-Band" Tunable Telemetry 125

Table 45 - Spacelabs Recent Financial Performance. 128

Table 46 - Selected Spacelabs Medical Parameter Modules 133

Table 47 - Spacelabs Medical Full Disclosure Capabilities 134

Table 48 - Spacelabs Medical’ Large Screen Displays 135