CV Sciences, Inc. · OTC:CVSI
CV Sciences — Investor Presentation (August 2018)
42 slides from CV Sciences's investor presentation, Aug 7, 2018
Slide 1: CBD-Based Pharmaceutical & Consumer Products Corporate Presentation
CBD - BASED PHARMACEUTICAL & CONSUMER PRODUCTS Corporate Presentation – August 4, 2018 Symbol: CVSI
Slide 2: Safe Harbor & Disclaimer
This presentation may contain certain forward - looking statements and information, as defined within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, and is subject to the Safe Harbor created by those sections. This material contains s
Slide 3: Corporate Overview
CV Sciences, Inc. ▪ Operations in: - San Diego, CA - Lexington, KY - Las Vegas, NV ▪ Founded in 2012 ▪ 70+ employees ▪ Two operating divisions: 1. Consumer products 2. Drug development ▪ Active ingredient - “Cannabidiol” (CBD) CORPORATE OVERVIEW 3 SYMBOL: CVSI
Slide 4: Trading Snapshot
Stock Symbol CVSI Trading Price (as of 8/1/18) $3.07 52 - Week Range $0.14 - $3.31 Avg. Daily Volume (3 mos ) 2.1 M Shares Outstanding 91 M Market Cap $278 M Float 76 M TRADING SNAPSHOT 4 SYMBOL: CVSI
Slide 5: Consumer Products Division
CONSUMER PRODUCTS DIVISION 5 SYMBOL: CVSI
Slide 6: Consumer Products Overview
CONSUMER PRODUCTS OVERVIEW Overview ▪ 50+ SKUs of branded products ▪ Sales channels include: ▪ 1968 retail locations nationwide ▪ 1000+ doctor offices nationwide ▪ Strong wholesale presence ▪ Growing ecommerce channel ▪ #1 Selling Hemp - based CBD Products* #2 Company in the Natural Products Retaile
Slide 7: Consumer Products
CONSUMER PRODUCTS Raw Formula Total Plant Complex Gold Formula Branded Product: PlusCBD Oil™ 50+ SKUs 7 SYMBOL: CVSI
Slide 8: Retail Store Placement
RETAIL STORE PLACEMENT 8 SYMBOL: CVSI
Slide 9: Natural Products Retailers – Store Count
NATURAL PRODUCTS RETAILERS – STORE COUNT 20 00 1 8 00 1600 1400 1200 1000 800 600 400 200 0 MARCH 2015 9 SYMBOL: CVSI JUNE 2015 SEPT 2015 DEC 2015 MARCH 2016 JUNE 2016 SEPT 2016 DEC 2016 MARCH 2017 JUNE 2017 SEPT 2017 DEC 2017 MARCH 2018 JUNE 2018 Store Count as of June 30, 2018 1,968 1,968
Slide 10: Sales Quarterly Comparison
SALES QUARTERLY COMPARISON $14,000 $12,000 $ 10,000 $8,000 $6,000 $4,000 $2,000 $0 Q1 2017 Q1 2018 Q2 2017 Q3 2017 Q4 2017 Q 2 2018 10 SYMBOL: CVSI (in thousands) $3.8 MILLION $4.1 MILLION $7.2 MILLION $8.1 MILLION $ 5.6 MILLION $ 12.3 MILLION
Slide 11: Gross Profit Quarterly Comparison
GROSS PROFIT QUARTERLY COMPARISON $ 10,000 $8,000 $6,000 $4,000 $2,000 $0 Q1 2017 Q1 2018 Q2 2017 Q3 2017 Q4 2017 Q 2 2018 11 SYMBOL: CVSI (in thousands) $ 2.4 MILLION $ 2.8 MILLION $ 5 .2 MILLION $ 5.6 MILLION $ 4.0 MILLION $ 9.1 MILLION
Slide 12: Adjusted EBITDA Quarterly Comparison
ADJUSTED EBITDA QUARTERLY COMPARISON $ 4,000 $ 3 ,000 $ 2 ,000 $ 1 ,000 $0 ($1,000) Q1 2017 Q1 2018 ($190) Q2 2017 Q3 2017 Q4 2017 Q 2 2018 ($281) 12 SYMBOL: CVSI (in thousands) $1,663 $1,882 $875 $3,806
Slide 13: Net Income Quarterly Comparison
NET INCOME QUARTERLY COMPARISON $ 4,000 $ 3 ,000 $ 2 ,000 $ 1 ,000 $0 ($1,000) ($2,000) ($3,000) ($4,000) Q1 2017 Q1 2018 $400 Q2 2017 Q3 2017 Q4 2017 $619 $3,186 Q 2 2018 ($922) ($590) 13 SYMBOL: CVSI (in thousands) ($3,785)
Slide 14: SPINS Data
SPINS DATA SPINS is the leading provider of analytics reporting for the Natural, Organic and Specialty Products Industry. 14 SYMBOL: CVSI PlusCBD Oil™ is Ranked the #1 Selling Hemp CBD Product According to SPINS Scan Data.
Slide 15: SPINS Data – Brand Rankings
SPINS DATA* *SPINS Trailing 12 - Week Sales Data through 6 / 17 /2018 Nordic Naturals PlusCBD Oil ™ Barleans Garden Of Life Carlson Natures Way CW Amazing Grass Private Label Now 1 2 3 4 5 6 7 8 9 10 RANK BRAND** 15 SYMBOL: CVSI
Slide 16: Product Safety
PRODUCT SAFETY 16 SYMBOL: CVSI • Dietary Supplement Health and Education Act of 1994 “DSHEA” • Amended the Federal Food, Drug, and Cosmetic Act - to establish standards for dietary supplements • Generally Recognized as Safe – “GRAS”
Slide 17: Product Safety – Published Paper
PRODUCT SAFETY 17 SYMBOL: CVSI Published Paper
Slide 18: Product Safety – Impact of GRAS
PRODUCT SAFETY 18 SYMBOL: CVSI IMPACT: GRAS self - affirmation has opened the market for… • Omega - 3 • CoQ10 • Collagen • Krill Oil
Slide 19: 2018 Federal Farm Bill
2018 FEDERAL FARM BILL Includes provisions that clarify legal framework for “Hemp” • Water Rights for farmers • Banking access for farmers and others • Research – plant genetics, growing conditions, harvesting & processing techniques • Crop Insurance • Changes jurisdiction from FDA/DEA to the USDA •
Slide 20: Wall Street – Getting Involved
WALL STREET – GETTING INVOLVED Estimated legal cannabis sales of $50 billion by 2026. Currently, sales are $6 billion. 20 SYMBOL: CVSI
Slide 21: Wall Street – Getting Involved
WALL STREET – GETTING INVOLVED $6 BILLION current legal sales 21 SYMBOL: CVSI Source: Cowen Estimates 2016 2026 $25 BILLION current “informal sales” $50+ BILLION 2026 forecast legal sales
Slide 22: Industry Growth
INDUSTRY GROWTH 22 SYMBOL: CVSI Source: Brightfield Group $1,600,000 $1,400,000 $1,200,000 $1,000,000 $800,000 $600,000 $400,000 $200,000 $0 2018e 2016 2017 2019e 2020e U.S. Hemp - Based CBD Product Sales, 2016 - 2021e $1.57 Billion U.S. Hemp - Based CBD Product Sales by Channel in 2021e 2021e (in t
Slide 23: Drug Development Division
DRUG DEVELOPMENT DIVISION 23 SYMBOL: CVSI
Slide 24: Drug Development Program
DRUG DEVELOPMENT PROGRAM Overview ▪ CVSI - 007 – lead drug candidate ▪ Cannabidiol (CBD) and nicotine combination ▪ Medical indication – to support cessation of smokeless tobacco use and addiction ▪ Proprietary technology (patent pending) ▪ Seeking 505(b)(2) drug approval pathway 24 SYMBOL: CVSI
Slide 25: Market Potential
No current FDA - approved drugs to treat smokeless tobacco use and addiction. ▪ There are only 2 smoking cessation FDA - approved drugs – Chantix (Pfizer) and Zyban (GSK) ▪ Until recently, both Chantix and Zyban had “black box warnings” that call attention to serious or life - threatening risks in t
Slide 26: Current FDA-Approved Treatments
2016 REVENUE: Approximately $1 billion CURRENT FDA - APPROVED TREATMENTS 26 SYMBOL: CVSI
Slide 27: Unmet Medical Need
Urgent Unmet Medical Need ▪ Smokeless tobacco is carcinogenic (risk of esophageal, oral and pancreatic cancers). ▪ Smokeless tobacco is one of the most addictive and potent ways of consuming nicotine (an average - size dip in the mouth for just 30 minutes can deliver as much nicotine as smoking thre
Slide 28: Epidemic: Smokeless Tobacco Use
Selected Epidemic Statistics ▪ Serious impact on youth: 5.8% of males 12 - 17 years of age reported use of smokeless tobacco. ▪ 49% of all military personnel used a tobacco product in the last 12 months. ▪ 12.8% of all military personnel used smokeless tobacco in the last month. EPIDEMIC: SMOKELESS
Slide 29: Tobacco Use Trends
Source: Euromonitor International, National Survey on Drug Use and Health Centers for Disease Control and Prevention TOBACCO USE TRENDS 20% 10% 0% - 10% - 20% - 30% - 40% 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 CUMULATIVE CHANGE IN U.S. UNIT SALES SMOKELESS TOBACCO 250,
Slide 30: Nicotine Addiction – Financial Impact
Financial Impact ▪ $300 Billion+ per year Direct medical care and lost productivity Sources: CDC and Tobacco Use and the Military NICOTINE ADDICTION – FINANCIAL IMPACT 30 SYMBOL: CVSI
Slide 31: CVSI-007: Cannabidiol + Nicotine
Using patent - pending technology, CV Sciences’ drug candidate (CVSI - 007) combines cannabidiol (CBD) and nicotine to focus on a significant unmet medical need in treating smokeless tobacco use/addiction. NICOTINE CANNABIDIOL + NICOTINE & CANNABIDIOL 31 SYMBOL: CVSI
Slide 32: Nicotine Use & Addiction
Overview ▪ Physical Dependence relaxant, stimulant, increased heart rate and blood pressure, decreased appetite ▪ Emotional Dependence “oral stimulation” of tobacco product used ▪ Mental Dependence nicotine is a mild “antidepressant” NICOTINE USE & ADDICTION 32 SYMBOL: CVSI
Slide 33: Nicotine PK/PD – Antidepressant
NICOTINE PK/PD - ANTIDEPRESSANT Nicotine reaches the brain in 7 - 10 seconds Nicotine is a mild antidepressant ▪ Mechanism of Action: monoamine oxidase (“MAO”) inhibitor ▪ MAO is an enzyme that breaks down dopamine and other “feel good” neurotransmitters that produce pleasure and reward ▪ Lower leve
Slide 34: Proprietary Technology
Internal PK/PD research on CBD contributed to our patent - pending technology The expanded therapeutic range of combining nicotine and CBD, creates a product that effectively addresses all three nicotine addictions. PROPRIETARY TECHNOLOGY 34 SYMBOL: CVSI NICOTINE CBD MAOI Half Life 1x 1hr 10x 24hr
Slide 35: Breaking Nicotine Addiction
Successfully treating nicotine addiction with nicotine/CBD combination therapy CVSI - 007 provides a therapeutic range that provides effective flexibility in treating the addiction rather simply replacing one nicotine product for another. 1. Nicotine – physical addiction (include nicotine) 2. Oral S
Slide 36: Nicotine Addiction Relapse
No current FDA - approved drugs (to treat smokeless tobacco use/addiction) OTC Treatments – Nicotine Replacement Therapies (NRTs) NRTs are the most widely used pharmacological product in treating nicotine addiction. Replacing cigarettes or smokeless tobacco products with another nicotine - only prod
Slide 37: Target Market
Smokeless Tobacco Market ▪ Approximately $5.3 billion annual U.S. retail sales of smokeless tobacco products. ▪ Approximately 10 million Americans use smokeless tobacco with enormous and growing worldwide use. ▪ Current multi - billion dollar treatment market and growing . TARGET MARKET 2022 Estimat
Slide 38: Epidiolex Approval
EPIDIOLEX APPROVAL 38 SYMBOL: CVSI EPIDIOLEX® (cannabidiol) oral solution ▪ First FDA approval of Cannabidiol
Slide 39: Drug Development Timeline
▪ Engaged with the FDA ▪ Complete nonclinical toxicology studies in 2018/2019 ▪ Submit Investigational New Drug (IND) application in early 2019 ▪ Begin clinical trials in 2019 DRUG DEVELOPMENT TIMELINE 39 SYMBOL: CVSI
Slide 40: FDA Press Release – August 3, 2018
FDA PRESS RELEASE – AUGUST 3, 2018 40 SYMBOL: CVSI Statement from FDA Commissioner Scott Gottlieb, M.D., on new steps the agency is taking to support the development of novel nicotine replacement drug therapies to help smokers quit cigarettes Posted on Aug 3, 2018 in FDA Press Releases As a public h
Slide 41: Positive Factors
1. Outstanding Financial and Operational performance 2. Strong Balance Sheet 3. These fundamentals are institutionally relevant 4. Potential uplisting to Nasdaq 5. Huge market expansion for Consumer Products - $1.6B by 2021 6. 2018 Farm Bill 7. EPIDIOLEX® approval 8. No FDA approved drugs for smokel
Slide 42: Contact
CV Sciences, Inc. Joseph Dowling, CEO 866 - 290 - 2157 ir@cvsciences.com cvsciences.com Media & Investor Relations IRTH Communications Robert Haag, Managing Director 866 - 976 - 4754 ir@cvsciences.com CONTACT 42 SYMBOL: CVSI