tdoc corporate presentations september 2015 -...

The relentless pursuit of better!

September 2015

2 I Copyright 2015 Teladoc Inc.

Safe Harbor Statement

This presentation contains, and our officers may make, “forward-looking” statements that are based on our management’s beliefs and assumptions and oninformation currently available to management. These forward-looking statements include, without limitation, information concerning possible or assumedfuture results of operations, including descriptions of our business plan and strategies. These statements often include words such as ‘‘anticipate,’’ ‘‘expect,’’‘‘suggests,’’ ‘‘plan,’’ ‘‘believe,’’ ‘‘intend,’’ ‘‘estimates,’’ ‘‘targets,’’ ‘‘projects,’’ ‘‘should,’’ ‘‘could,’’ ‘‘would,’’ ‘‘may,’’ ‘‘will,’’ ‘‘forecast,’’ and other similar expressions.

Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievementsto be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Forward-lookingstatements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materiallydifferent from any future results, performance or achievements expressed or implied by the forward-looking statements. These statements are based on certainassumptions that we have made in light of our experience in the industry and our perception of historical trends, current conditions, expected futuredevelopments and other factors we believe are appropriate under the circumstances as of the date hereof. These and other important factors may cause ouractual results, performance or achievements to differ materially from those expressed or implied by these forward-looking statements. Such risks and otherfactors that may impact management’s beliefs and assumptions are more particularly described in our filings with the U.S. Securities and ExchangeCommission (the “SEC”). As a result, we cannot guarantee future results, outcomes, levels of activity, performance, developments or achievements, and therecan be no assurance that our expectations, intentions, anticipations, beliefs or projections will result or be achieved or accomplished. The forward-lookingstatements in this presentation are made only as of the date hereof. Except as required by law, we assume no obligation to update these forward-lookingstatements, or to update the reasons actual results could differ materially from those anticipated in the forward-looking statements, even if new informationbecomes available in the future.

This presentation also contains estimates and other statistical data made by independent parties and by us relating to market size and growth and other dataabout our industry. This data involves a number of assumptions and limitations, and you are cautioned not to give undue weight to such estimates.

This presentation may include certain non-GAAP financial measures as defined by SEC rules. We believe that the presentation of such non-GAAP financialmeasures enhance an investor’s understanding of our financial performance. We use certain non-GAAP financial measures for business planning purposesand in measuring our performance relative to that of our competitors.


Introductions and Presenters

• CFO since October 2012

• CFO of RCS/Media Monitors

• CFO of BT Radianz

• Vice President and Global Controller of RSL Communications

• CEO since June 2009

• President of Empire BlueCross BlueShield

• SVP and Chief Marketing and Product Officer at WellPoint

• Director of Service Strategy and other roles at Oxford Health Plans

• General Manager of Business Messaging at Mail.com

Mark HirschhornEVP & CFO3 years

Jason GorevicPresident & CEO

6 years

What we doResolving patient issues, delivering client ROI

Provide 24x7, on demand access to board-certified doctors via phone, mobile, and video

Diagnose, treat and prescribe medications (if necessary) for common health issues

Behavioral health, dermatology and smoking cessation available

Prevent unnecessary ER/UC visits to more cost-effective mode of care

4©2015 Teladoc, Inc. All rights reserved.

Teladoc at a Glance

$20M

$44M

2013 2014 Q1 '14 Q1 '15

6.2M8.1M 7.8M

11.5M

2013 2014 Q2 '14 Q2 '15

4,000+Total Clients

$10M$18M

Q2 '14 Q2 '15

127K

299K

61K125K

2013 2014 Q2 '14 Q2 '15

Revenue ($M)

Visits (000s)

Members (M)

Doubled client and membership bases

over the past two years

12.5 million Unique Members

20+Health plan Clients

160 Fortune 1000 Clients


Excellence by the Numbers24x7x365 on-demand healthcare anytime, anywhere via mobile devices, internet, video and phone

1 Over the last six years 2 Our subscription access fee revenue provides significant visibility into our future operating results. For example, our annualized January 2013 and 2014 revenue reflected approximately 90% of our actual and

budgeted revenue for each respective full fiscal year3 Based on an independent study of the nation’s largest home-improvement retailer, a Client since 2012 with 150,000+ Members as of 12/31/144 Average over the last three years5 Based on the ability of a Teladoc physician to earn ~$150/hour which represents a 50%+ increase to the average full-time physician hourly wage

+95%Average Member Satisfaction1

1,500+Visits per Day on Average

104% Average Net Dollar Retention4

50%Increase to Physician

Hourly Income5

+9xClient ROI3

92%Patient Issues Resolved3

+90%Revenue Visibility2

417mAnnual Addressable Visits

<10 MinMedian Physician Response Time


Investment Highlights

Attractive Business Model with Strong Revenue Growth and Substantial Opportunity to Scale

Value for All Constituents: Payor / Employer; Member / Employee & Provider

Delivering Significant, Measurable ROI

First and Largest Telehealth Solution

Disruptive Care Delivery Model with High Clinical Quality

Growing Underpenetrated Market with an Estimated 417mm Annual Patient Visits


Sustainable Differentiation

+

+ ROIUtilizationConsumer Engagement

=

Network structureNetwork structure

Clinical capabilities

Clinical capabilities

Scalable and integrated technology

Scalable and integrated technology

Robust capabilities that deliver significant and measurable ROI to Clients

+


Teladoc’s Total Addressable Market

1.25 billion ambulatory care visits11.25 billion ambulatory care visits1

Primary carePrimary care ERER Outpatient Outpatient OtherOther

1 According to a 2010 report from the Centers for Disease Control and Prevention (CDC); includes visits in the United States per year, including those at primary care offices, hospital emergency rooms, outpatient clinics and other settings

2 33% based on Teladoc's internal estimates / assessment of conditions listed in the CDC report. According to a Deloitte report “eVisits: The 21st Century Housecall,” of the 600 million annual visits to general practitioner offices in the US and Canada, about 50% are treatable through telehealth

3 Based on Teladoc estimates for average cost of a telehealth visit (does not include PMPM fees or premium pricing for new products)

33% estimated treatable through telehealth2

417 million visits417 million visits Up to $40 cost per telehealth visit3

Up to $40 cost per telehealth visit3 TAMTAM=×


The Teladoc Solution is Simple, Convenient and Intuitive for the Member…

Note: Reflects next generation mobile application currently in development.

1 REGISTER 2 REQUEST & CONNECT3 4 VISIT & RESOLVE5

In 2015, Teladoc will deliver over 50,000 visualized consults, more than anyone else in the industry

40%Web/Mobile

60%Call Center

70%

30%“Visualized” via video and/or uploaded HD Images

Telephonic

How Members request a Consult Type of Consult patients choose*



Common Uses and Best Practices

o Proprietary evidence based clinical

guidelines

o National Committee for Quality Assurance

certification (NCQA)

o Electronic prescribing

o Patient education

o EMR sharing with existing physicianso Dermatology

o Anxiety

o Smoking Cessation

Top Diagnoses and Cases Teladoc Best Practices

Areas of New Clinical Expansion

o Sinusitis

o Urinary Tract Infection

o Conjunctivitis (Pink Eye)

o Upper Respiratory Infection

o Nasal Congestion

o Bronchitis

o Allergies

o Influenza

o Yeast Infection

o Cough and Cold

o Grief Counseling

o Marriage Counseling

o Sexual Health


High Clinical Quality

Only US telehealth company

Zero malpractice claims

Continuity of care records

(i.e., EMR sharing)

100% visits reviewed for new

physicians

10% charts reviewed monthly

Adherence to 100+ proprietary evidence-

based clinical guidelines

92% clinical resolution1

Teladoc physicians are consistently reviewed to ensure a high level of quality care and adherence to appropriate treatment and prescription guidelines

1 Based on an independent study of the nation’s largest home-improvement retailer, a Client since 2012 with 150,000+ Members as of 12/31/14


…but with Complex Operations Integrated into the Broader Healthcare Ecosystem

Our approach to driving utilizationWhen planning, we look for multiple ways to support our

clients driving awareness and engagement


On-site messaging and integration via Marketing Communications Portal

Broad based National Marketing that drive results

Best in class Teladocmember messaging


Employers Health Plans Health Systems

Serving Leading CustomersOver 4,000+ clients including 160 Fortune 1000 companies and more than 20 health plans, plus health systems and other entities

34% 21% 6% 52%Visits occurred on

weekends and holidays

Patients had not sought care in the past year

Required a follow-up visit (vs 20% ER)

Represent top 3 diagnoses (vs 72%

at retail clinics)

This independent study by Rand of 300,000 Teladoc participants analyzed 2 years of claims data, conducting a 21-day episode of care analysis.

An independent studyby Rand revealed::

Quality and effectiveness with great value



Case Study: Rent-a-Center represented 24,000 Members(1)

Note: Weighted Average is based on redirection rates determined using member utilization of bricks and mortar services: 75% OV; 20% ER; 5% Do Nothing Source: (1) Cost savings data are based on an independent study of Rent-a-Center, a Client with 24,000+ Members as of 12/31/14 analyzed over a period of 24 months

(2) RAND Corporation, February 3, 2014.

Clinical Capabilities Drive Significant Savings

Breadth(2)“Teladoc served patients with surprisingly

diverse diagnoses.”

Breadth(2)“Teladoc served patients with surprisingly

diverse diagnoses.”

Quality(2)“Patients who used Teladoc were less likely to have a follow-up visit to any setting, compared

to those patients who visited a physician’s office or emergency department”

Quality(2)“Patients who used Teladoc were less likely to have a follow-up visit to any setting, compared

to those patients who visited a physician’s office or emergency department”

(1)


Note: Data based on independent studies using healthcare utilization data. 1 PMPM refers to “per member per month”“PMPM analysis” evaluated resource use and spending before vs. after Teladoc (represents 18 month and 20 month periods prior to and following the Teladoc implementation, respectively)‘‘Episode-based analysis” evaluated resource use and spending by Teladoc users vs. other beneficiaries receiving care for same conditions in physician offices or ERs

Case Study: Nation’s Largest Home Improvement Retailer with 150,000 Members

$593KSubscription access fees

paid in 2014

$593KSubscription access fees

paid in 2014

$5.4 millionEst. Client savings in 2014

from using Teladoc

$5.4 millionEst. Client savings in 2014

from using Teladoc

9.0xROI from Teladoc=÷

Significant and Measurable ROI

1 2

3

$40

Teladoc Savingsvs.

Office VisitAverage savings

per employeeTeladoc Savings

vs.ER Visit

$2,661

$1,157

$2,661

$191

Total spending before and after Teladoc introduction

$21.30Average reduction

vs. projected PMPM spending

Introduction of

Nation’s Largest Home Improvement

RetailerEst. $5.4 Million in

Savings in 2014

PM

PM

($)

Time

Actual PMPM Medical Spend1

Projected PMPM Medical Spend1


Number of Members (000s)Number of Members (000s)

Partnership with Health Plans

Aggregate MembersNew Members

+6% +90% +47% +33%YoY growth

659 698

1,328

1,958

659

39

630

630

663

2011 2012 2013 2014 2015

Opportunity to grow membership by +50 million through existing health plan ClientsOpportunity to grow membership by +50 million through existing health plan Clients

Business RelationshipsBusiness Relationships

Enterprise ContractsEnterprise Contracts

(Real-time eligibility interface)

(RTE interface) (Strategic Alliance)698

1,328

1,958

2,621

Teladoc is well positioned for consolidation in the health plan industry with 75+ employer clients with UnitedHealthcare and Anthem, 9 of which are part of the Fortune 1000

Teladoc is well positioned for consolidation in the health plan industry with 75+ employer clients with UnitedHealthcare and Anthem, 9 of which are part of the Fortune 1000

22.2 million available Aetna beneficiaries as

of 12/31/14


Telehealth Market Leader

o Outside core competency

o Lack of strategic focus

o Late market entry

Other Healthcare Services

Companies

Other Healthcare Services

Companies

o Sub-scale solutions

o Not NCQA certified

o Lower engagement rates

o Network structure challenges

o Limited distribution

Pure Play Competitors

Pure Play Competitors

o Lack of expertise

o Poor product development track record

o Historically poor consumer engagement

Health PlansHealth Plans

Sources of Competition Sustainable Differentiation

Brand Identity & Reputation

Clinical Quality

Consumer Engagement

Operating Experience

First-Mover Advantage

Other competitors

Teladoc is significantly larger than all

competitors combined1

1 Estimate based on PROJECTED 2015 total telehealth visits according to The American Telemedicine Association 2015. Assumes 800,000 total telehealth visits in 2015 with Teladoc delivering 525,000 visits.

65%35%

National scale and coverage

We adhere to regulations in all 50 states with the capacity to support 100+ million

members


VIDEO VISITS ONLY WITH RX

PHONE VISITS ONLY, WITH RX

VISITS UNAVAILABLE

VIDEO OR PHONE VISITS WITH RX


Teladoc’s Growth Strategies

o New Accounts & Channels

o Existing Health Plans

o Increase Utilization

o Direct to Consumer

o Behavioral Health

o Dermatology

o 2nd Opinion / Specialty Advice

o STI / HIV Testing

o Diabetes

o Health Kiosk

o Mobile Apps / Hubs

o Biometric Devices

o At-Home Tests

o Home Care

o Post Discharge

o Wellness / Screening

o Chronic Care

Expand Footprint / Penetration

Expand Footprint / Penetration

Expand Specialties

Expand Specialties

Expand Scope ofProducts &

Services

Expand Scope ofProducts &

ServicesExpand Clinical

Use CasesExpand Clinical

Use Cases


Key Financial Model Highlights

o Additional Members from both existing clients and from new clientso Increased awareness & engagement increased utilization o New clinical specialties behavioral, derm. and chronic conditions

Embedded Growth

Opportunities

Embedded Growth

Opportunities

o Subscription-based monthly revenue modelo One to five year client contractso Average 104% annual net dollar retention rate over last three years

Contractually Recurring

Revenue Model

Contractually Recurring

Revenue Model

o Low marginal cost to support new memberso Highly predictable visit utilization patternso +70% gross margins1

AttractiveEconomic Model

AttractiveEconomic Model

o Low long-term capital intensity o Scalable framework for capital deploymento Platform offers acquisition opportunities to build membership,

capabilities and service offerings

Capital Deployment

Capital Deployment

1 Gross margin refers to gross profit divided by revenue


127K

299K

2013 2014

Attractive Historical Operating and Financial Performance

Members (M)Members (M) Visits (000s)Visits (000s) Revenue ($M)Revenue ($M)

6.2M8.1M

2013 2014

$20M

$44M

2013 2014

61K125K

Q2'14 Q2'15

7.8M

Q2'14 Q2'15

$10M

$18M

Q2'14 Q2'15

11.5M

+70% gross

margin


Balance Sheet Snapshot

($ in mm)Actual

6/30/2015Pro Forma 6/30/2015

Cash & Equivalents $15 $183

Receivables $9 $9

Total Assets $107 $270

Total Current Liabilities $26 $26

Total Debt $27 $27

Convertible preferred stock $118 -

Stockholders’ (deficit) equity ($79) $205

Total liabilities and stockholder equity $107 $270


Teladoc Highlights

Attractive Business Model with Strong Revenue Growth and Substantial Opportunity to Scale

Value for All Constituents: Payor / Employer; Member / Employee & Provider

Delivering Significant, Measurable ROI

First and Largest Telehealth Solution

Disruptive Care Delivery Model with High Clinical Quality

Growing Underpenetrated Market with an Estimated 417mm Annual Patient Visits

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