Solventum Corporation Wells Fargo 21st Annual Healthcare Conference

Of course. Yeah. Glad to be here.

Yeah. So maybe we had a feeling, Wayde and I, that we might get a few questions around HIS. Go figure, right? Maybe the way I'll start with that question in the way that you framed it is just on the second part. I want to reiterate that statement, that I really do look at autonomous coding as a revolution that's going to happen in revenue cycle management. And there's a couple of components that you need to make that a reality. Number one, it's technology, and where AI is today gives us a leg up to be able to move us in that direction and move the market in that direction.

But in concert with that, you have to have a data set that is unique, and you have to have a knowhow, I am going to call it tribal knowledge algorithms, that are unique to us to be able to train AI, to be able to leverage that effectively. So those pieces are in place and we are uniquely positioned to win. So I stand by that. I think that is going to happen. I also recognize that it is going to take a significant amount of investment and focus to get it accomplished, and we truly do believe that it will move faster and be more valuable if that entity is on its own and/or connected to someone who is in that space. We have got other businesses that we have to pay attention to.

We want to be a medtech player, and strategically speaking, this business does not quite fit the same as the others. So that is really the reason why we are moving in that direction, and we think it is the right time to do it. It has nothing to do with how attractive the business is. We think it is fantastic. It is just not as suited for us as it is for somebody else.

Okay. So the only thing I would change there is the likely 4%-5% is still intact. It is definitely still intact, the 4%-5% without HIS. And I would just speaking to the market growth rate, remember, HIS is less than 20% of the business, so Dental, the RemainCo Dental, MedSurg would be over 80% of the business. And when you look at the market growth of MedSurg, which is the largest majority of that, it is 4%-5%, and then Dental is 3%-5%. So there is really not much change to the overall market growth of RemainCo. And I guess the other thing I would look at is we are already kind of moving in that direction, so we have a lot of confidence in it. So the only thing I would change in the question is, it is not likely, it will happen.

Once we get there, our goal is to move beyond that.

Yeah. So I would say the 3.7% that you're referencing is just the middle of the 3.5%-4% ex-SKU that we gave for the whole company. I think it's good that you're using it for RemainCo, or in other words, MedSurg, dental, because the only way you can get there is if those two businesses, being that they're over 80% of the business, get to that growth rate. So I think the biggest proof point on us getting to 4%-5% is that we're already pretty close to it, right? We're predicting to get pretty close to it in 2026. Now outside of that, there are areas of concentration that we have. For those that are new to the story, we have these things that we call growth drivers.

We spent a lot of time when we came into the business to select the markets we were going to concentrate on and then the growth drivers inside of those. We coalesce all of our resources, or most of our resources, around those growth drivers, and four of those will be in the remaining business. One of them goes with HIS. Inside of those growth drivers, we really have, I'm going to call it three organic areas that should give people confidence. The first is that we've changed the commercial organization to specialize in those areas. So I'll call that commercial optimization, which is a really important leg of the stool.

The second, people may not recognize this, and I was very happy to find it, is we have legacy technologies that are very valued brands in the marketplace, that are clinically differentiated, that have been around for a long time, that are significantly under-penetrated. We've got an opportunity through that specialization just to get adoption of those technologies. The third leg of the stool from an organic standpoint is just new product innovation. We've really seen great product launches since we spun, and we've got almost 20 new products that we're going to launch through the first quarter of 2028. We'll talk a lot more about those at the Investor Day in March. Those are the reasons why you should have confidence.

In addition to that, from an inorganic perspective, Acera's been a great acquisition, and as we roll into 2027, as you know, that becomes organic growth for us as well.