Staar Surgical Company · NASDAQ:STAA
Staar Surgical — Investor Presentation (May 2010)
30 slides from Staar Surgical's investor presentation, May 21, 2010
Slide 1: STAAR Surgical (NASDAQ: STAA)
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Slide 2: Forward-looking statements
the plans, strategies, and objectives of management for future operations, any statements regarding expectations for success of the ICL or other products in U.S. or international markets, any statements concerning proposed new products and government approval of new products, servic: regarding futur
Slide 3: Surgical Technology And Applied Research
= Surgical Technology And Applied Research = Leadets of Innovative Ophthalmic Devices = Foldable Intraocular Lens (IOL) = Collamer® Material = Toric IOL = IOL Delivery Systems (Preloaded, small incisions) a Implantable Collamer Lens ICL™) Was
Slide 4: Investment highlights
= Two Latge Market Opportunities = Two Differentiated Product Lines = Strong Barriers to Entry = Improving Financial Performance = Strong Balance Sheet = Poised for Growth and Profitability in 2010 Sa
Slide 5: Refractive surgery market opportunity
= Upto 1.5 billion nearsighted people worldwide = 5 Million Refractive procedures WW by 2014 = 7.7% CAGR = LASIK challenged by economy and technology’s limitations Source: The Global Refractive Surgery Market by Market Scope November 2009 Kas
Slide 6: Implantable Collamer Lens
= Implantable Collamer Lens better known as “the implantable Contact Lens.” = Made from a proprietary material called Collamer allowing placement between the iris and natural lens = Corrects myopia (nearsightedness) from 3 diopters to 15 diopters for patients ages of 21 to 45 = Alternative to LASIK
Slide 7: Refractive Procedures
Refractive Procedures Laser Based Lens Based LASIK Visian ICL
Slide 8: Visian ICL versus LASIK
= Small micro incision = Adds a lens into the eye = Permanent but removable = Provides UV protection = No dry eye = 99% satisfied after five years with ICL = Incision over 1 inch-long = Burns material away = Cannot be reversed = No UV protection = Potential dry eye = High percent of enhancements
Slide 9: Refractive Error Treatment Zone for Visian ICL
= Refractive Error Treatment Zone for Visian ICL = Higher diopters of myopic correction (-6D and above) = Those with higher vision expectations (-3D to -6D) = 65% of LASIK patients in U.S. are -3D or above = LASIK results drop and complications rise the higher the diopter error = Ocular Conditions w
Slide 10: Superior Data for Young Adults in the Military with Low Myopia
Superior Data for Young Adults in the Military with Low Myopia “Weapons Grade Vision” UCVA Fort Fort | Typical | Custom | TICL Brage*| Hood*| ICL* | LASIK | Data 20/10 or better 9% 4% 1% 20/15 or better a ere 20/20 or better 98% 100% 80% 70-80% 82% Tea error -7.1 6.2 -9.5 -9.4 *Eyes with pre-op cyli
Slide 11: Approval in Japan of the Visian ICL
Approval in Japan of the Visian ICL in February = Submission of the Visian TICL filed = Training session for 47 surgeons in April, next session in June = Submission in U.S. of the Visian Toric ICL aC ly ‘keted in 45 y R di . Pp ng to TICL is 31% percent and 41% of dollars whete available from FDA q’
Slide 12: Visian Toric ICL clinical results
= 77% of eyes post-op Uncorrected Visual Acuity was the same or better than the Best Corrected Visual Acuity pre-op = With Visian Toric ICL they saw the same or better than their best day with glasses or contacts = 47% of the eyes saw BETTER with Visian Toric ICL than their best day with glasses or
Slide 13: Global ICL Revenues
Millions Global ICL Revenues HD DH HDD PM Pw DS? AD? 4D? 99? AD? AD? 1? 1G? VO OPS SESS SS SH SSK 85%+ Gross Margins
Slide 14: Recent U.S. Refractive Procedure Trends
Recent U.S. Refractive Procedure Trends <@STAAR “=e TLC —LCAV rw <MktScope /08 Q3/08 Q4/08 Q1/09 Q 140 § 03/09 Q 4709 Q1/10 — mas
Slide 15: Visian ICL Grows Despite Economy
Visian ICL Grows Despite Economy Top Ten Refractive Markets 09 Procedures | 07 Procedures | 09 ICL Growth | ICL Share US. 1,417,000 Flat China 650,000 +37% Japan 439,000* (17%) Spain 180,000 +1% India 120,000 +79% Italy 135,000 +21% S. Korea 135,000 +87% Germany 125,000 (1%) UK. 82,000 (7%) France 8
Slide 16: Worldwide IOL market in 2014
= $3.1b Worldwide IOL market in 2014 = 8.2% CAGR = U.S. Market is $1.1 b in 2014 = 8.7% CAGR = Driven by innovation / improved outcomes / aging population Source: The Global IOL Market by Market Scope September 2009 OY as
Slide 17: STAAR IOLs for Cataract
STAAR IOLs for Cataract Preloaded Proprietary IOLs a _ *Actylic ( y 7 : . Silicone a Collamer Afinity Aspheric Collamer nanoPLEX >) Three Piece (NTIOL) Aspheric (NTIOL) Nike y: [- y Silicone Toric Plate Silicone Aspheric Three (Premium Pricing) Piece (NTIOL)
Slide 18: Collamer material properties
= Proprietary hydrophilic material produces superior quality of vision = 40% water content produces: = Less internal reflectance (reduces glare and halo) as compared to all other materials = Induces fewer higher order aberrations = Free from glistenings = Patent protection until 2015 = Preliminary d
Slide 19: Collamer accommodation observations
= Clinical observations: Collamer provides some accommodation or better visual results = Inherent property of the material?? = Collamet Accommodating Study Team = Eight leading ophthalmic surgeons = Team will be monitoring three evaluations: = First is to benchmark current nanoFLEX IOL (Complete) es
Slide 20: Distance Corrected Near Vision - nanoFLEX vs. Standard IOLs
Distance Corrected Near Vision - nanoFLEX vs. Standard IOLs COMPELLING NEAR VISION When compared to Standard IOLs $2020 $20/25 20/32 $20/40 220/40 nanoFLEX (73) 0.0% 68% 30,1% a7/9% s21% AMO Tecnis(119)| 0.8% Gas 176% 387% ape Std Silicone(64) 0.0% 00% am 350% alae ECollamer 3-pc(54)| 0.0% 0.0% 165%
Slide 21: Average Distance Corrected Intermediate Vision
Average Distance Corrected Intermediate Vision 20/38 20/30 iil nanoFLeX Crystalens Crystalens ReZoom ReSTOR {N=59) HD(N=64) _5.0{N=47} {N=128) {N=46)
Slide 22: CAST II and CAST III
CAST II = Clinical protocol using the current nanoFLEX IOL = Goal: confirm CAST findings in rigid clinical trial = Bi-lateral 125 patients with 9 to 12 month follow = Potential new NTIOL class = New marketing data for IOL CAST IIT = Clinical protocol with a few design changes in nanoFLEX = Goal: obt
Slide 23: Abbott acquires Visiogen for $400M plus earn out
$400M plus earn out = Sales at about $35M in 2007 = Sales in 2009 about $70M = 2009 Abbott acquires Visiogen IOL technology for $400M plus = Not yet FDA approved = Market Scope Global PCIOL Market Estimates = Grow from $265M in 09 to $1.1B in 2015 Source: The Global Market for Presbyopia-Correcting
Slide 24: 2009 Results
2009 RESULTS Excluding Other Charges 2009 2008 2007. 09 to 08 Revenue $ 753M $ 749M $ 594M +1% Gross Profit $ 419M $ 416M $ 29.3M +1% Operating Exp $ 456M $ 50.7M $ 434M (10%) Operating Inc $ (3.7M) $ (91M) $(14.1M) +59% Net Income $ (6.2M) $ (119M) $(16.0M) +48% + Other charges in 2008 of $11.3M: i
Slide 25: 2010 First Quarter
2010 First Quarter Comparison to Q1 2009 Qi 10 Qi 09 Revenue $ 138M $ 12.2M Gross Profit $ 88M $ 7.7M Gross Profit % 64.1% 63% Operating Expenses $ 88M $ 95M Oper Exp % 63.5% 78.3% Operating Income $ 76k $( 1.9M) Delta +13.3% +15. 3% +110bps (8%) (1480bps) +104%
Slide 26: Continuing Financial Improvements
Continuing Financial Improvements Gross Margin and Operating Expense Ratios SF Dh GD HS HP HF HF GO OP GO OP Ww SKS HF oF PEF PS PW oS
Slide 27: 2010 Key Metric Report Card
2010 Key Metric Report Card Double Digit Revenue growth in ICL and IOL Gross Margin mid 60% Progress toward profitability Cash from operations J Improve balance sheet
Slide 28: Cash and capital structure
= Cash of $23.8 Million = $4 Million due for litigation settlement = $5 Million Note due Broadwood in December fot Japan acquisition = $6.8 Million in Preferred Stock to Canon for Japan acquisition (1.7 million at $4) = 34.9 million shates of common stock outstanding/ approximately 41.8 million full
Slide 29: A Road to Profitability in 2010?
A Road to Profitability in 2010? 2009 Pro Forma* | 2010 Way Revenue $ 75.3M $51.8M $ 59.6 M** Gross Profit $419M $31.8M $ 38.7 M Op Expenses $456M $36.8M $ 34.0M OpIncome $(3.7M) $(5.0M) $ 47M NetIncome $(6.2M) $(7.8M) $ 35M *2009 Pro Forma excluding Domilens Business. #*Theoretical model intended t
Slide 30: Investment highlights summary
= Two Latge Market Opportunities = Two Differentiated Product Lines = Strong Barriers to Entry = Improving Financial Performance = Strong Balance Sheet = Poised for Growth and Profitability in 2010 KE ie