Genomic Health — Merger or Acquisition (August 2019)
35 slides from Genomic Health's merger presentation, Aug 12, 2019
Slide 1: Safe harbor statement: Cautionary Statement
Safe harbor statement Cautionary Statement This presentation contains statements, including statements regarding the proposed acquisition of Genomic Health, Inc. (“Genomic Health”) by Exact Sciences Corporation (“Exact Sciences”) that are forward-looking statements within the meaning of Section 27A
Slide 2: Safe harbor statement: Additional Information
Safe harbor statement Additional Information In connection with the proposed transaction, Exact Sciences will file with the SEC a registration statement on Form S-4, which will include a document that serves as a prospectus of Exact Sciences and a proxy statement of Genomic Health (the “proxy statem
Slide 3: Exact Sciences 2019 financials
Exact Sciences 2019 financials Q2 2019 Q2 2018 Revenue $199.9 million $102.9 million Completed tests 415,000 215,000 Gross margin 74% 74% Operating expense $182.1 million $108.7 million Cash utilization $43.3 million $45.3 million Ending cash balance $1.2 billion $1.2 billion Exact Sciences 4
Slide 4: We deliver life-changing innovations in earlier cancer detection
We deliver life-changing innovations in earlier cancer detection Exact Sciences 5
Slide 5: Colorectal cancer: America's second deadliest cancer
Colorectal cancer: America’s second deadliest cancer Lung 51,020 Colorectal Annual deaths Pancreatic Breast Liver Prostate Source: American Cancer Society, Cancer Facts & Figures 2019; all figures annual Exact Sciences 6
Slide 6: Detecting colorectal cancer early is critical
Detecting colorectal cancer early is critical Diagnosed in Stages I or II Diagnosed in Stage IV 10 years 9 of 10 years 1 of Survive 5 Survive 5 Source: SEER 18 2004-2010 – colorectal cancer statistics Exact Sciences 7
Slide 7: Cologuard: addressing the colorectal cancer challenge
Cologuard: addressing the colorectal cancer challenge 94% Easy to use Non-invasive Early-stage cancer sensitivity* No preparation No sedation No time off work 24/7 customer support For adults 50 years or older and at average risk Developed with *For stage I and II cancers; 92% sensitivity overall, 8
Slide 8: Impact of patient navigation service on compliance
Impact of patient navigation service on compliance 67% Phone Calls Letters 24/7 Support 38% Emails Texts Sources: 1. Patient adherence over 3 years, Liang PS., et al., Am J Gastroenterol. 2016 2. Patient compliance within 1 year, Arch Intern Med 2012; 172(7):575-582 (Inadomi) Cologuard’s compliance
Slide 9: Increasing America's screened population
Increasing America’s screened population Screening history of Cologuard users 12% screened only with FIT/FOBT 48% never screened before 40% screened with colonoscopy Screening history of Cologuard users: Exact Sciences Laboratories patient satisfaction survey, Oct. 2017-Sep. 2018, n = 5,377 Exact Sc
Slide 10: Capturing a multi-billion dollar U.S. market opportunity
Capturing a multi-billion dollar 415K U.S. market opportunity U.S. screening market for Cologuard* 87M+ $15B 97% test volume CAGR 54K 5.7% Market share** 2Q16 2Q19 *Exact Sciences estimate, assuming 87 million average-risk, asymptomatic people ages 50-85, revenue per test of $500-$525, and 3-year in
Slide 11: Demand fueling strong Cologuard revenue growth
Demand fueling strong Cologuard $199M revenue growth 2Q16 – 2Q19 Revenue 111% CAGR Gross profit 138% CAGR Total OpEx 47% CAGR growth $21M 2Q16 Cologuard-only compound annual growth rate (CAGR) from 2Q16 through 2Q19 Exact Sciences 2Q19 12
Slide 12: Impact of Cologuard
Impact of Cologuard 2.6M People screened since launch 12K Early-stage cancers detected 84K Pre-cancerous polyps detected Source: based on extrapolation of findings in DeeP-C pivotal trial population to the ~2.6M screened using Cologuard since launch: Imperiale TF et al., N Engl J Med (2014) Exact Sc
Slide 13: Cologuard's growing provider adoption
Cologuard’s growing provider adoption ~174K Total providers 142K 8K Primary care 62% provider CAGR Gastroenterologists 6K OBGYNs 17K Other 2Q16 Compound annual growth rate (CAGR) from 2Q16 through 2Q19 Note: primary care providers includes family practice, internal medicine, nurse, and physician’s a
Slide 14: 2019 Corporate Priorities
2019 Corporate Priorities PowerthePartnership Enhance Cologuard Advance Liquid Biopsy Exact Sciences 15
Slide 15: Power the Partnership
Power the Partnership Exact Sciences 16
Slide 16: Partnering to help screen more people
Partnering to help screen more people Salesforce calls on health care providers Health system relationship-building Shared investment in nationwide marketing campaign Exact Sciences 17
Slide 17: Improving access to Cologuard
Improving access to Cologuard 94% Of Cologuard out-of-pocket patients cost* have no In-network contracts include: *Exact Sciences estimate based on historical patient billing and impact of recently executed network agreements Exact Sciences 18
Slide 18: Epic partnership advantages
Epic partnership advantages #1 KLAS ranked healthcare software suite Scalable IT infrastructure Ease of ordering Data access Exact Sciences 19
Slide 19: Preparing for demand
Preparing for demand Investing in people, infrastructure, and lab capacity to support >40% market share goal our Exact Sciences 20
Slide 20: Enhance Cologuard
Enhance Cologuard Exact Sciences 21
Slide 21: 45-49 label expansion opportunity
45-49 label expansion opportunity Increase in U.S. screening market for Cologuard including 45-49 age group* 50-85 average risk +19M average risk people $15B $18B 45-49 average risk Cologuard is indicated for adults 50 and older. Exact Sciences intends to pursue a label expansion for Cologuard use b
Slide 22: Improving Cologuard performance with new markers
Improving Cologuard performance with new markers Improve specificity 2.0 Increase revenue Decrease cost of goods Note: currently evaluating whether new biomarkers could increase specificity while maintaining sensitivity Cologuard 2.0 is not approved by the FDA Exact Sciences 23
Slide 23: Advance Liquid Biopsy
Advance Liquid Biopsy Exact Sciences 24
Slide 24: Biomarker discovery across cancers
Biomarker discovery across 15 cancers Lung Esophageal Breast Ovarian Stomach Uterine Pancreatic New cancer test development Cervical Liver Prostate Colorectal Bladder Melanoma Kidney Lymphoma Exact Sciences 25
Slide 25: Proven partnership
Proven partnership 10-year collaboration with Mayo Clinic Biomarker discovery & validation Access to samples & clinical trials Leading researchers & clinicians Liquid biopsy for top 15 cancers Exact Sciences 26
Slide 26: Exact Sciences' advantages
Exact Sciences’ advantages Multiple classes of biomarkers Proprietary DNA chemistry State-of-the-art lab Flexible, automated platform Regulatory expertise Commercial scale Exact Sciences 27
Slide 27: Liquid biopsy: a growth area for cancer diagnostics
Liquid biopsy: a growth area for cancer diagnostics Exact Sciences focusing on early detection and recurrence >$13B Projected liquid biopsy market in 2030* Hereditary testing Screening Diagnosis Recurrence monitoring Therapy selection Response monitoring Source: Analyst estimates Exact Sciences 28
Slide 28: Liver cancer: America's fifth deadliest cancer
Liver cancer: America’s fifth deadliest cancer Lung 31,600 Colorectal Annual deaths Pancreatic Breast Liver Prostate Source: American Cancer Society, Cancer Facts & Figures 2019; all figures annual Exact Sciences 29
Slide 29: Regular liver cancer testing leads to better outcomes
Regular liver cancer testing leads to better outcomes Under regular testing Not under regular testing 6 of 10 years 3 of 10 years Survive 3 Survive 3 Source: Kuo, YH et al., Eur J Cancer (2010) Exact Sciences 30
Slide 30: Market opportunity in liver cancer testing
Market opportunity in liver cancer testing 3M* High-risk Americans $1.5B** Market opportunity *Exact Sciences estimate **Total addressable market assumes revenue per test of $500 and 3M tested annually Exact Sciences 31
Slide 31: Creating a leading global cancer diagnostics company
CREATING A LEADING GLOBAL CANCER DIAGNOSTICS COMPANY July 29, 2019 Exact Sciences Exact Sciences + Genomic Health
Slide 32: Together address large colorectal, breast and prostate cancer markets
Together Exact Sciences and Genomic Health address large colorectal, breast and prostate cancer markets Annual Total Addressable Market By Indication $200M $20B $600M $700M U.S. Average Risk U.S. 45-49 y.o. U.S. Breast International U.S. Prostate Other Total Cologuard & Oncotype DX (1) (2) (3) Color
Slide 33: Transaction overview
Transaction overview 35 TERMS • Cash and stock transaction valued at $2.8 billion • Genomic Health stockholders will receive $72.00 per share • $27.50 per share in cash • $44.50 per share of Exact Sciences stock, subject to a 10% collar centered on Exact Sciences’ volume-weighted average price (“VWA
Slide 34: Transaction overview
Transaction overview TERMS: + Cash and stock transaction valued at $2.8 billion Genomic Health stockholders will receive $72.00 per share + $27.50 per share in cash + $44.50 per share of Exact Sciences stock, subject to a 10% collar centered on Exact Sciences’ volume-weighted average price ("VWAP")
Slide 35: Exact Sciences
EXACT SCIENCES