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CHV PresentationApril 16, 2014

Healthcare Investing that Impacts People’s Lives

Investing that Changes People’s Lives

5 investments; All Active2 derivative investmentsActively Investing

2

Investing in Healthcare since 2000

CHVI

Y2000

Y2008

Y2013

10 investments; 7 exits1 ActiveNotable Exits: Novazyme (Genzyme), Biotrove (Life Technologies), Hansen Medical (NASD: HNSN), GI Dynamics (AUS: GID)

10 investments; 3 exits7 ActiveNotable Exits: Biocius (Agilent), Vortex Medical (AngioDynamics)

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CHVIII

Investing that Changes People’s Lives 3

Who We Are

Joshua Phillips Managing Partner

Darshana Zaveri Partner

Kevin McCafferttyCo-Founder, Special Partner

Robert VigodaCo-Founder, Special Partner

Dianne LetzelterCFO & VP of Investor Relations

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CHV Portfolio

12.7

1.6

5.8

2.1Kaleidoscope Medical

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Healthcare Investing: Risks

Longer Clinical and Development Cycles

Uncertain Regulatory Environment– No clear directive on Diagnostics – Device approvals taking longer

Uncertain Reimbursement Environment– Harder to get paid for products and procedures– Focus on outcomes– Uncertainty in diagnostics reimbursement

Overall Dampening Effect on Venture Investing– Poor Returns, particularly IRR– Fewer healthcare funds raised

CHVIII

Investing that Changes People’s Lives 6

Healthcare Investing: Opportunities

16% of GDP and Growing

Non Cyclical business

Changing Demographics– People living longer; Want to be active and stay at home as long as possible– New healthcare needs created

No overall change in Medtech companies appetite for acquisition – Product pipeline weak post 2020– Long term outlook favorable

CHVIII

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Taking Advantage of the Opportunities

Healthcare rapidly adopting value-based purchasing

Industry focus is on improving outcomes and lowering cost

Manifests in several ways– Reimbursement– Pricing– Approvals

All our portfolio companies demonstrate a clear value proposition aligned with this new world

It’s not just amazing technology!

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Our Strategy: Focus on Opportunity Selection

Focus on Large Opportunities within Healthcare– Billion $ markets– Big clinical needs: Women’s Health, Cancer, Cardiology, Audiology

Invest in Innovative Technology Solutions; Limit Scientific Risk– High probability of value creation

Capital efficient – Responsible investing– Entrepreneur friendly

Earlier stage than traditional VC– Ability to add significant non-financial value– Fill a real financing gap

Meaningful impact on health

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Case Study: Vortex Medical

Challenged prevalent assumptions on investment needs– Virtual Company; 1 employee– Outsourced all non-core functions including Development, Regulatory and

Manufacturing– Commission based sales model

Challenged prevalent assumptions on regulatory, pricing and reimbursement– Clear, well thought out regulatory strategy resulted in non-clinical, 510K

clearance – Clear, well thought out economic benefit analysis resulted in payment for

every single procedure– Product commercialized in US first; One of the highest priced single use

devices on market

Capital Efficient Model– $3.5M total investment and <4 years from idea to exit– Acquired by Angiodynamics Inc. (NASD: ANGO)

CHVII

Transformed Standard of Care for PE; Superb Returns for Investors