LETTER CONTINUED FROM P.02 

## Innovation 

INNOVATION IS THE LIFE-BLOOD OF VARIAN AND ITS ONGOING IMPORTANCE IS DEMONSTRATED BY THE FACT that more than 65 percent of Oncology equipment orders came from products introduced in the last three years. By the end of fiscal 2013, we booked nearly 1,000 orders and completed some 500 instal- lations of our TrueBeam™ system, which technologically set a new standard for linear accelerators when it was introduced in 2010. During the year we launched and booked orders for some 60 new systems and upgrade packages for our Edge™ radiosurgery suite, which we hope will drive revolution- ary advances in the fight against lung cancer and many other diseases. 

With work completed during the year, we established software connectivity with the Siemens installed base, giving Siemens’ customers the choice of using Varian’s advanced technology when replacing aging treatment machines. We also advanced the development of technology that capitalizes on the best in MR imaging, linear accelerators and treatment planning for targeting tumors. 

Outside of Oncology, we extended the reach of our X-ray tubes and panels with equipment makers who are continuing to develop new filmless imaging systems for medical diagnostics, dentistry, veteri- nary care and security. We also introduced new products for more compact cargo screening systems, and we made good progress on developing smaller and more cost-effective proton therapy systems. 

$ 208M 

1 2 % 

> 65 % 

INVESTED IN R&D 

INCREASE IN R&D INVESTMENT 

OF ONCOLOGY EQUIPMENT ORDERS FROM PRODUCTS INTRODUCED IN LAST 3 YEARS 

LETTER CONTINUES ON P.07 

Varian has more than 1,000 active and pending pat- ents around the world. Annually, Varian files dozens of patent applications based on continuing innovation in the use of X-rays and high energy physics in medi- cal and industrial applications, X-ray imaging, proton therapy, brachytherapy and software for radiother- apy and radiosurgery. 

