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2012

A REPORT ON LIFE TECHNOLOGIES

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Industry Profile The life sciences and analytical reagents market is driven by the increasing use of reagents in therapeutics, basic research and commercial applications. The demand for biotechnology reagents is mainly dependent upon the growth of the biotechnology instrumentation market. The biotechnology instrumentation market continues to witness significant growth due to an increase in the number of biotechnology firms around the globe and increase in research and development expenditure by the biotechnology companies, thus augmenting the demand for biotechnology instruments. Continual product developments are being witnessed in various industries, such as pharmaceutical/biopharmaceutical, agri-biotech, and food and beverages; this is expected to facilitate market growth. The global life science and analytical reagents market was valued at $40,308.8 million in 2011 and is expected to reach $59,319.2 million by 2016; growing at a CAGR of 8% from 2011 to 2016.

North America dominated the life sciences and analytical reagents market with 46.28% share in 2011. Successful completion of the first phase of the Human Genome Project, ahead of schedule, has given rise in the U.S. reagent market. Investments, government funding, and new products are driving the reagents market in the U.S. The Asian market, however, shows greater opportunities, when compared to other regions, with the highest CAGR of 11.8% from 2011 to 2016; due to increased research outsourcing activities in the life technology field.

About Life Technologies Life Technologies is a global leader in innovative technology that serves the entire biological spectrum, including translational research, molecular medicine, forensics, food safety and animal health. The company offers its products and services under three divisions, namely Molecular Biology Systems (MBS), Cell Systems (CS) and Genetic Systems (GS). The products offered by the company include instruments, systems and reagents. Life Technologies provides a portfolio of products such as technologies for next generation sequencing, capillary electrophoresis based sequencing, sample preparation, mass spectrometry, ribonucleic acid (RNA) interference analysis, cell culture, functional genomics research, proteomics and clinical diagnostic applications and cell biology applications. It also offers water testing analysis products. The company is headquartered at Carlsbad in California, the US with annual sales revenue of $3.7 billion (2011). Life Technologies operates in more than 160 countries and holds about 3,100 patents, 50,000 products (461 in 2011) and importantly no one product represents more than 5% of the sales. They are diversified across products, customers and geographies which made them very resilient during the tough economic times. They have built a well balanced portfolio that drives an 80% recurring revenue stream from consumables and services, most of which cost under $500.

BRANDS

Ambion - It is the primary brand within Life Technologies for work involving RNA. It includes products for isolation, detection, quantification, amplification, and characterization. Ambion also provides specific kits for different types of RNA research based on the sample type (bacteria, tissue, cell, yeast, blood etc.) and type of results desired. Applied Biosystems - Provides equipment for researchers in genotyping and genetic analysis, forensic DNA, food testing and animal health, pharmaceutical purification and analytics, PCR, flu virus research, stem cell research, and laser capture microdissection Gibco - Provides materials for research and biologic drug production, including cell culture products, reagents, cell culture bags, and growth factors. Invitrogen - Provides products and services for work involving DNA and biology. They offer more than 25,000 products and services that support research in fields such as genomics, drug discovery, proteomics, and cellular analysis. Ion Torrent - It is the first commercial ion semiconductor DNA sequencing system. It uses proprietary semiconductor sensors to perform real-time measurement of the hydrogen ions produced during DNA replication. A high-density array of wells on the ion semiconductor chips provides millions of individual reactors while integrated fluidics allow reagents to flow over the sensor array. This combination of fluidics, micromachining, and semiconductor technology enables the direct translation of genetic information (DNA) to digital information (DNA sequence) that makes the Personal Genome Machine Sequencer. Molecular Probes - Provides fluorescent labeling and detection. It is used by cell biology labs, nanotechnology research labs, and antibody production facilities. Novex - Provides protein reagents and consumables for the purification, separation, quantitation, and analysis of proteins, including SDS-PAGE gels, stains, standards, antibody technologies, and Western blotting products. Taqman - Provides research use products for gene expression, miRNA, protein analysis, copy number variation, and SNP genotyping analysis. Novex - Provides protein reagents and consumables for the purification, separation, quantitation, and analysis of proteins, including SDS-PAGE gels, stains, standards, antibody technologies, and Western blotting products.

COMPETITORS: Life Technologies is a life sciences company that provides products and services that assist researchers and commercial markets in scientific exploration. The companys products and services include instruments, reagents, software and custom services, such as clinical diagnostic applications, forensics and water testing analysis. One of Life Technologies main competitors in the life sciences tools and services industry is Thermo Fisher Scientific (TMO). Other competitors in the healthcare sector include: Techne (TECH), QIAGEN N.V(QGEN), and Affymetrix (AFFX).

LIFES STRATEGIC IMPERATIVES:

1. Accelerate Product Innovation: In 2011 the company continued to build its product portfolio by introducing over 800 new SKUs. With over 1,500 scientists and annual R&D investments of approximately 9% of revenue spent on R&D investments, Life Technologies is committed to continuing its leadership in innovation within the markets it serves. The company offers the broadest portfolio of products, including consumable kits, reagents and cutting edge instrumentation designed to accelerate the pace of discovery by making research simpler, faster and more accurate. 2. Drive Operational Excellence: Life Technologies continues to leverage its unparalleled scale and scope which includes 2,000 global sales and service employees, a growing ecommerce platform with over $1 billion in annual sales, and a global manufacturing and distribution platform reaching customers in over 160 countries. Combined with the company's ongoing operating efficiency initiatives, the company continues to deliver revenue growth while expanding operating margins which have increased from 26.6% in 2009 to 29% in 2011. The company has plans in place to achieve operating margins in excess of 31% by the end of 2013.

3. Expand Market Opportunities: The market opportunity for their products is anticipated to grow to over $30B by 2016, from $18B in 2009 across basic research, applied markets and molecular diagnostics. We are in the "century of biology" where scientific insights will increasingly be applied against societal challenges such as food, environment, fuel and health. The company's technologies, including qPCR, BioProduction and Next Generation Sequencing, are already creating value, and Life is committed to accelerating our growth in new end markets by extending its research tools to new applications in the areas of environmental sciences, agriculture research, bio-defense, diagnostics, forensics and pharmacogenomics.

4. Enhance our geographic footprint: Life Technologies continues to expand its manufacturing and distribution capabilities in emerging markets, which represents a significant opportunity for the company. Emerging markets, currently representing approximately 10% of revenue in 2011, is growing at a compounded annual growth rate of 20%-30%. In 2011, the company continued to expand its business in Greater China, where we continue to build our operations and develop a local presence to take better advantage of the opportunities.

HIGHLIGHTS OF LIFE TECHNOLOGIES Q1 2012 RESULTS Revenue increased by 5% to $939 million

The company operates business under three business groups o Research Consumables o Genetic Analysis o Applied Sciences Research Consumables revenue was $420 million, an increase of 4 percent compared to the prior year (growth in our cell culture products, endpoint PCR and molecular and cell biology consumables). Genetic Analysis revenue was $356 million in the first quarter, an increase of 7 percent over the same period last year (primarily due to growth of Ion Torrent and CE products). Applied Sciences revenue was $162 million in the first quarter, an increase of 4 percent over the same period last year (increase was driven by the Bio Production, Forensics and Animal Health and Food Safety businesses). Regional revenue growth rates for the quarter compared to the same quarter of the prior year were as follows: the Americas were flat, Europe grew 2 percent, Asia Pacific grew 8 percent and Japan grew 7 percent. Revenue from orders transacted through ecommerce channels grew 6 percent during the quarter. Over 50 percent of all transactions are processed using ecommerce platforms. Gross profit increased $34.3 million or 7% in the first quarter of 2012 compared to the first quarter of 2011.

GLOBAL PRESENCE

COMPANYS RECENT DEVELOPMENTS Life Technologies Corporation, Recent Developments Jun 18, 2012: Life Technologies Launches Expanded, Next Generation GeneArt Kits for Mutagenesis, Cloning and Assembly. Jun 15, 2012: Life Technologies Signs Licensing Agreement with iPS Academia Japan for Global Patent Portfolio Rights to Induced Pluripotent Stem Cell Technology. Jun 14, 2012: Life Technologies and Cellular Dynamics International Partner for Global Commercialization of Novel Stem Cell Technologies Jun 12, 2012: Life Technologies Establishes Global Instrument Center of Excellence in Singapore. May 30, 2012: Life Technologies and OpGen Sign Collaborative Agreement to Leverage Ion Torrent and Whole Genome Mapping Technologies

CONCLUSION
Emerging markets continue to offer incredible growth opportunities. We had high-teens growth in Greater China during the quarter and saw double-digit growth in our Latin

American business, as well as strong growth in Eastern Europe and Russia, where we are expanding our sales network. We are primarily a direct seller of our goods, although in new markets, we have often entered with the help of local distributors.