DEFA14A 1 ddefa14a.htm DEFA14A DEFA14A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

(Amendment No.      )

 

Filed by the Registrant x                            Filed by a Party other than the Registrant ¨

Check the appropriate box:

 

¨ Preliminary Proxy Statement

 

¨ Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

 

¨ Definitive Proxy Statement

 

¨ Definitive Additional Materials

 

x Soliciting Material Pursuant to §240.14a-12

 

 

Cytyc Corporation


(Name of Registrant as Specified In Its Charter)

 

 


(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

 

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¨ Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

 

  (1) Title of each class of securities to which the transaction applies:

 

 
  (2) Aggregate number of securities to which the transaction applies:

 

 
  (3) Per unit price or other underlying value of the transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):

 

 
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The following presentation will be delivered by management of Cytyc at the Piper Jaffray London Health Care Conference on June 20, 2007 at 8:40 a.m., London time ( 3:40 a.m. Eastern).


Cytyc Corporation


A Leading Provider of Innovative
Medical Technology
Piper Jaffray
London
Healthcare Conference
June 20, 2007


Disclaimer Regarding Forward-Looking
Statements
Forward-Looking
Statements
Regarding
Cytyc
Investors are cautioned that statements in this presentation which are not strictly historical
statements, including, without limitation, Cytyc's future financial condition, operating results
and economic performance, and management's expectations regarding key customer
relationships, future growth opportunities, product acceptance and business strategy,
constitute forward-looking statements. These statements are based on current expectations,
forecasts
and
assumptions
of
Cytyc
that
are
subject
to
risks
and
uncertainties,
which
could
cause actual outcomes and results to differ materially from those statements.  Risks and
uncertainties include, among others, the successful integration of acquired businesses into
Cytyc's business, dependence on key personnel and customers as well as reliance on
proprietary technology, uncertainty of product development efforts and timelines,
management of growth, product diversification, and organizational change, entry into new
market segments domestically, such as pharmaceuticals, and new markets internationally,
risks associated with litigation, competition and competitive pricing pressures, risks
associated with the FDA regulatory approval processes and healthcare reimbursement
policies in the United States and abroad, introduction of technologies that are disruptive to
Cytyc's business and operations, the potential consequences of the restatement of Cytyc's


Disclaimer Regarding Forward-Looking
Statements (continued)
financial statements for the period 1996 through 2002, relating to certain employee stock
option
exercises, including the impact of the expected any regulatory review or litigation
relating to such matters, the impact of new accounting requirements and governmental rules
and regulations, as well as other risks detailed in Cytyc's filings with the SEC, including those
under the heading "Risk Factors" in Cytyc's 2006 Annual Report on Form 10-K/A and
Adeza's 2006 Annual Report on Form 10-K, all as filed with the SEC.
Cytyc cautions readers not to place undue reliance on any such forward-looking statements,
which
speak
only
as
of
the
date
they
were
made.
Cytyc
disclaims
any
obligation
to
publicly
update or revise any such statements to reflect any change in its expectations or events,
conditions,
or
circumstances
on
which
any
such
statements
may
be
based,
or
that
may
affect
the likelihood that actual results will differ from those set forth in the forward-looking
statements.


Disclaimer Regarding Forward-Looking
Statements (continued)
Forward-Looking
Statements
Regarding
the
Proposed
Hologic-Cytyc
Transaction
This presentation also includes forward-looking statements about the timing of the
completion of the transaction, the anticipated benefits of the business combination
transaction involving Hologic and Cytyc, including future financial and operating results, the
expected permanent financing for the transaction, the combined company's plans, objectives,
expectations and intentions and other statements that are not historical facts.  Hologic and
Cytyc caution readers that any forward-looking information is not a guarantee of future
performance
and
that
actual
results
could
differ
materially
from
those
contained
in
the
forward-looking information.
These include risks and uncertainties relating to: the ability to obtain regulatory approvals of
the transaction on the proposed terms and schedule; the parties may be unable to complete
the transaction because conditions to the closing of the transaction may not be satisfied; the
risk that the businesses will not be integrated successfully; the transaction may involve
unexpected costs or unexpected liabilities; the risk that the cost savings and any other
synergies from the transaction may not be fully realized or may take longer to realize than
expected; disruption from the transaction making it more difficult to maintain relationships
with customers, employees or suppliers; competition and its effect on pricing, spending,
third-party relationships and revenues; the need to develop new products and adapt to


Disclaimer Regarding Forward-Looking
Statements (continued)
significant technological change; implementation of strategies for improving internal
growth; use and protection of intellectual property; dependence on customers' capital
spending policies and government funding policies, including third-party reimbursement;
realization of potential future savings from new productivity initiatives; general worldwide
economic conditions and related uncertainties; future legislative, regulatory, or tax changes
as well as other economic, business and/or competitive factors; and the effect of exchange
rate
fluctuations
on
international
operations.
In
addition,
the
transaction
will
require
the
combined
company
to
obtain
significant
financing.
While
Hologic
has
obtained
a
commitment to obtain such financing, including a bridge to the permanent financing
contemplated in the presentation, the combined company’s liquidity and results of operations
could be materially adversely affected if such financing is not available on favorable terms. 
Moreover,
the
substantial
leverage
resulting
from
such
financing
will
subject
the
combined
company’s business to additional risks and uncertainties.  The risks included above are not
exhaustive.  The annual reports on Form 10-K, the quarterly reports on Form 10-Q, current
reports on Form 8-K and other documents Hologic and Cytyc have filed with the SEC
contain additional factors that could impact the combined company’s businesses and
financial performance.  The parties expressly disclaim any obligation or undertaking to
release
publicly
any
updates
or
revisions
to
any
such
statements
to
reflect
any
change
in
the
parties’
expectations or any change in events, conditions or circumstances on which any such
statement is based.


Important Information for Investors and
Stockholders
Hologic and Cytyc will file a joint proxy statement/prospectus with the SEC in connection
with the proposed merger. HOLOGIC AND CYTYC URGE INVESTORS AND
STOCKHOLDERS TO READ THE JOINT PROXY STATEMENT/PROSPECTUS WHEN
IT BECOMES AVAILABLE AND ANY OTHER RELEVANT DOCUMENTS FILED BY
EITHER PARTY WITH THE SEC BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION.
Investors and stockholders will be able to obtain the joint proxy statement/prospectus and
other
documents
filed
with
the
SEC
free
of
charge
at
the
website
maintained
by
the
SEC
at
www.sec.gov.  In addition, documents filed with the SEC by Hologic will be available free
of charge on the investor relations portion of the Hologic website at www.hologic.com. 
Documents filed with the SEC by Cytyc will be available free of charge on the investor
relations portion of the Cytyc website at www.cytyc.com.


Participants in the Solicitation
Hologic, and certain of its directors and executive officers, may be deemed participants in
the solicitation of proxies from the stockholders of Hologic in connection with the merger.
The names of Hologic’s directors and executive officers and a description of their interests in
Hologic are set forth in the proxy statement for Hologic’s 2006 annual meeting of
stockholders,
which
was
filed
with
the
SEC
on
January
25,
2007.
Cytyc,
and
certain
of
its
directors and executive officers, may be deemed to be participants in the solicitation of
proxies
from
its
stockholders
in
connection
with
the
merger.
The
names
of
Cytyc’s
directors
and executive officers and a description of their interests in Cytyc is set forth in Cytyc’s
Annual Report on Form 10-K/A for the fiscal year ended December 31, 2006, which was
filed with the SEC on April 30, 2007.  Investors and stockholders can obtain more detailed
information regarding the direct and indirect interests of Hologic’s and Cytyc’s directors and
executive
officers
in
the
merger
by
reading
the
definitive
joint
proxy
statement/prospectus
when it becomes available.


Use of Non-GAAP Financial Measures
In addition to the financial measures prepared in accordance with generally accepted
accounting principles (GAAP), we use the non-GAAP financial measures "adjusted EPS"
and “EBITDA”. Adjusted EPS excludes the write-off and amortization of acquisition-related
intangible
assets,
and
tax
provisions/benefits
related
thereto.
EBITDA
is
defined
as
net
earnings (loss) before interest, taxes, depreciation and amortization expense. Neither
adjusted EPS nor EBITDA is a measure of operating performance under GAAP.  We believe
that the use of these non-GAAP measures helps investors to gain a better understanding of
our
core
operating
results
and
future
prospects,
consistent
with
how
management
measures
and forecasts our performance, especially when comparing such results to previous periods
or forecasts.  When analyzing our operating performance, investors should not consider these
non-GAAP measures as a substitute for net income prepared in accordance with GAAP.


Growth Objectives and Strategy
Deliver 20+% long-term earnings growth through:
Global organic growth across divisions
Internal research and development
Strategic acquisitions and partnerships
Grow existing businesses resulting in continued
revenue growth and improved PBIT margins
Enhance organizational bench strength by attracting,
motivating, and retaining top talent to support
business needs


0
100
200
300
400
500
600
700
800
900
1 Billion
Growth through Diversification
2003
2005
2006
Diagnostic
International
Surgical
$303
Millions $
$508
$608
10%
90%
61%
29%
10%
11%
34%
55%
73%
16%
11%
2004
$394


Operating Divisions
Domestic Surgical Products Division
NovaSure
®
Endometrial Ablation
MammoSite
®
Radiation Therapy
Domestic Diagnostic Products Division
ThinPrep
®
Pap Test
ThinPrep
®
Imaging System
Cellient
Automated Cell Block System
Full
Term
®
:
The
Fetal
Fibronectin
Test
International Division


Domestic Surgical Products
Changing medical practice with innovative
medical technology
NovaSure
Endometrial Ablation
Treatment for excessive menstrual bleeding:  $2.5 B market
opportunity
MammoSite
Radiation Therapy
Treatment of early-stage breast cancer:  $300 M opportunity


NovaSure Procedure
NovaSure Procedure
4-minute, outpatient
procedure
No pretreatment drugs
required
Conscious sedation
Recovery = 1 hour
Highest success rates
Reimbursement
established nationwide


Endometrial
Ablation:
A
Large
and
Underserved
Market
Estimates per Cytyc Corporation *All age groups
Hysterectomy,
D&C, GEA
0
1
2
3
4
5
6
7
8
Total
Suffering
Silent
Sufferers
Hormonal
Therapy
7m
4.5m
1.8m
0.7m
1 in 5 women
suffers from
Abnormal Uterine
Bleeding
2.5 million women
seek treatment*
In Millions
2.5 m


MammoSite
Radiation Therapy
Creating new standard of care
Deliver optimal dose of radiation
to tissue at highest risk of
cancer recurrence
Minimize damage to healthy
tissue
Expanding data supports partial
breast radiation and MammoSite
Clinical trial (5-year data; 43
patients): 0 recurrences
ASBS registry (2-year data;
1,400 patients)
MammoSite
RTS
afterloader
accessories
MammoSite
RTS applicator


0
50,000
100,000
150,000
200,000
250,000
300,000
MammoSite Market Opportunity
MammoSite Market Opportunity
275,221
189,490
131,695
126,002
MammoSite Primary
U.S. Cases of Breast Cancer and DCIS (.4% Incidence, 40+)
Patients Eligible for Breast Conserving Therapy (Excludes >3cm, Size A)
Patients Receiving Breast Conserving Therapy (70%)
Patients Eligible for Mammosite (Excludes women <45, Pathology)
Market Opportunity
Large tumors
70% elect BCT
Surgical
margins or
lymph node
involvement


Domestic Diagnostic Products
ThinPrep
®
Pap
Test
ThinPrep
®
Imaging
System
FullTerm
®
:
The
Fetal
Fibrinectin
Test
Cellient
Automated
Cell
Block
System


Marlborough
Cytyc International –
Cytyc International –
Driving Growth Worldwide
Driving Growth Worldwide
Legend
Australia
UK
Spain
France
Italy
Germany
Switzerland
Hong Kong
Costa Rica
China
Mexico
Brazil
South Africa
So. Korea
Company presence
Key distributors
Japan
Operating in over 20 countries
Canada


0
10000
20000
30000
40000
50000
60000
70000
80000
2004
2005
2006
ROW
AsiaPac
Europe
Total CAGR
30%
International Revenue 2004 –
2006
International Revenue 2004 –
2006
$40 m
$52 m
$68 m


Cytyc International
Cytyc International
Pursue 3 key growth levers
Capture and solidify diagnostic share
Expand Gyn surgery share and market size
Lay foundation for MammoSite growth
Strengthen our infrastructure to better serve
customers and capture market opportunities


Creating a Global Leader in Women’s Healthcare
Continuing a legacy of leading technology, innovation and rapid growth
May 21, 2007


Expanded Product Portfolio
Comprehensive Sales Coverage
Ability to Leverage OB/GYN Channel
Significant Cross-Selling Synergies
Enhanced International Presence
Creating a Global Leader in Women’s Healthcare
Market Share Leader in Major Product
Lines
Proven Management Team
Significant Cash Flow Generation
Accretive to Adjusted EPS
1
Within the
First Full Year After Close
Strategic Rationale
Combined Strengths
1
Adjusted EPS excludes the write-off and amortization of acquisition-related
intangible assets, and related tax effect.


MultiCare
Stereotactic
Biopsy
Discovery
Osteoporosis
Screening
Selenia
Breast Cancer
Screening
MammoSite
Radiation
Therapy
ThinPrep Pap Test & Imaging System
Cervical Cancer Screening
NovaSure
Endometrial
Ablation
Adiana
Contraception
FullTerm
-
Adeza
Preterm Labor
Best-in-Class Solutions
in
Women’s Healthcare
Suros
Biopsy Systems
Comprehensive Women’s Healthcare Platform


Solutions for Major Women’s Healthcare Issues
Helica
Unpenetrated
1 in 3
Gestiva
International
ThinPrep
Imaging System
International
Tomosynthesis
Suros Celero
Additional
Opportunities
Adiana
FullTerm
Fetal
Fibronectin
Discovery
Sahara
NovaSure
ThinPrep
Pap Test
Selenia
MultiCare
Suros ATEC
MammoSite
Combined
Offering
High
Medium
Low
High
Medium
High
Market Growth
$100M
$1B+
$400M
$110M
$2.5B+
$550M
$1B
U.S. Market Size
1 in 4
1 in 2
Pregnancies
1 in 2
1 in 5
1 in 138
1 in 8
U.S. Women
Affected
Endometriosis
Permanent
Contraception
Preterm
Labor
Osteoporosis
Menorrhagia
Cervical
Cancer
Breast
Cancer
International
NM
NM
#1
#1
#1
#1
#1
U.S. Market
Position
International
International
International
International
Source: Market research and company estimates.


Multiple platforms to enhance top and bottom line growth
Increased scale through diversification of revenue and
strong margin profile
Enhanced cash flow; LQA EBITDA of ~$436M
Revenue and cost synergy opportunities
Estimated
more
than
$0.10
accretive
to
adjusted
EPS
1
within
the first full year after close, significantly more accretive
thereafter
Rapid debt repayment, incremental earnings growth
Financial Rationale
1
Adjusted EPS excludes the write-off and amortization of acquisition-related
intangible assets, and related tax effect.


Combined Financial Strength
46%
Gross Margin
$161M
EBITDA
$724M
Revenue
LQA
Hologic
75%
Gross Margin
$275M
EBITDA
$720M
Revenue
LQA
Cytyc
60%
Gross Margin
$436M
EBITDA
$1.44B
Revenue
LQA
Combined Company


Creating a  Global Leader in Women’s Healthcare
Comprehensive Women’s Healthcare Product Portfolio
Complementary best-in-class technologies
Expanded Commercial Capabilities
Expansive U.S. sales channel coverage
Enhanced presence in key international markets
Platform for entry into new markets
Opportunity to offer Integrated Solutions
Screening
Diagnostics
Therapeutics


A Leading Provider of Innovative
Medical Technology


Cytyc Corporation