Neogenomics, Inc. · NASDAQ:NEO
Neogenomics — Investor Presentation (February 2019)
33 slides from Neogenomics's investor presentation, Feb 21, 2019
Slide 1: Investor Presentation February 2019
Exhibit 99.1 INVESTOR PRESENTATION February 2019
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation has been prepared by NeoGenomics, Inc. (“we,” ”us,” “our,” “NeoGenomics” or the “Company”) and is made for informational purposes only and does not constitute an offer to sell or a solicitation of an offer to buy securities, nor shall there be any sale of
Slide 3: Investment Highlights
Investment Highlights Leading publicly-traded, comprehensive, pure-play oncology testing company in the U.S. Substantial Oncology/Genetics Market tailwinds Significant near-term growth drivers Market share gains driven by customer satisfaction Rapidly growing Pharma Services business Tra
Slide 4: Who We Are
Who We Are COMMON PURPOSE We save lives by improving patient care. VISION By providing uncompromising quality, exceptional service and innovative solutions, we will be the World’s leading cancer testing and information company. VALUES − Quality − Integrity − Accountability − Teamwork − Innovation We
Slide 5: Company Overview
Company Overview Comprehensive, oncology-focused test menu • Extensive molecular-oncology offering, with 150+ tests • A leader in immuno-oncology testing • In-house digital pathology expertise Extensive clinical expertise • ~80 pathologists and PhDs Global Pharma Services offering • $99 million back
Slide 6: US Oncology Lab Market
US Oncology Lab Market Clinical Reference Labs Pure Play Oncology Reference Labs Niche Oncology Players (with oncology divisions) (comprehensive test menus) (limited test menus) 6
Slide 7: Our Competitive Advantage
Our Competitive Advantage • Comprehensive, multi-modality “one-stop-shop” • Large and advanced somatic cancer test menu • Unparalleled reach into all customer segments, including hospitals, pathologists, and community oncology practices • National footprint and extensive payer contracts • Outstandin
Slide 8: Multi-modality One-stop-shop
Multi-modality One-stop-shop Complementary and Comprehensive Anatomic Flow Cytometry Cytogenetics FISH Molecular Pathology • Sanger Sequencing • Extensive • Robust Library of • Consultation Pathology • State-of-Art • Next-Gen Sequencing technology automation for High Validated Probes • Immunohistoch
Slide 9: Molecular Assays
Molecular Assays NeoGenomics offers a wide breadth of technology platforms • Broad menu • 150+ different tests • More than 30 multi-gene tumor tests WGS, WES, RNA-Seq, NeoAg • TMB, MSI, other immuno-oncology assays 1000’s Targeted genomic/RNA-Seq. & Cancer Panels 100’s Ion Torrent™ < 10 Illumina® No
Slide 10: Our Pharma Services Offering
Our Pharma Services Offering FDA Filing, Pre-Clinical Research & Phase Phase Phase Approval & Launch Discovery I II III Preparation Biomarker Discovery Analytical Validation Dx Development Clinical Validation Assay Design & Development Rx Development Track Dx Development Track Pharma Services Divisi
Slide 11: Net Promoter Score
Net Promoter Score How likely is it that you would recommend this company to a friend or colleague? (Scale of 1 to 10): • Promoters: 9-10 • Passives: 7-8 • Detractors: 0-6 • Net Promoter Score = (Promoters – Detractors) X 100 (Respondents) 500 452 Q4 2018 Clinical Client Survey 400 300 216 By The Nu
Slide 12: Track Record of Growth – Clinical Services
Track Record of Growth – Clinical Services **Clinical Testing Annual Revenue Clinical Tests Performed ($, MMs) 749,902 657,394 $242 563,132 $210 $203 $88 222,744 $79 $63 175,688 $56 135,580 $40 112,434 $32 56,710 75,576 $27 31,868 44,924 $18 20,998 $6 $10 4,082 12,838 $0.6 $2 1,152 2004 2005 2006 20
Slide 13: Rapidly Growing Pharma Services Business
Rapidly Growing Pharma Services Business $MMs $110.0 44% YoY 98.9 97.2 Backlog 89.6 Growth $90.0 71.7 68.7 $70.0 $50.0 $30.0 26.4 33% YoY 21.2 19.3 Revenue 13.8 14.2 Growth 10.6 8.2 9.6 $10.0 8.0 6.5 (4.2) (0.3) (2.1) (1.9) -$10.0 Q4'17 Q1'18 Q2'18 Q3'18 Q4'18 Revenue Booked (net) Change in Dormant
Slide 14: Track Record of Improvement In Cost Per Test
Track Record of Improvement In Cost Per Test $350 $328 $325 $318 $300 $294 $275 $256 $250 $243 $225 $221 $201 $200 $179 $175 $171 $150 2010 2011 2012 2013 2014 2015 2016 2017 2018 Average Cost of Good Sold / Clinical Test 14
Slide 15: Revenue per test stabilized in 2018
Revenue per test stabilized in 2018 $600 $575 558 $550 535 $525 498 $500 $475 464 451 $450 $425 396 $400 $375 361 $350 323 $325 319 $300 $275 $250 $225 $200 $175 $150 2010 2011 2012 2013 2014 2015 2016 2017 2018 Avg. Clinical Testing Revenue/Test 15
Slide 16: Oncology Market Tailwinds
Oncology Market Tailwinds Aging population driving cancer incidence Increased survival driving follow-on testing Growing number of therapeutic options Increased therapeutic complexity Burgeoning oncology drug pipeline Emerging platforms and tests (NGS, TMB, MSI, etc.) 16
Slide 17: Significant Near-Term Growth Drivers
Significant Near-Term Growth Drivers 6 Integrate Genoptix 5 Proactively address revenue 4 per test New managed care and GPO 3 contracts Pursue FDA- Approved multi- 2 gene NGS panel Global strategic alliance with PPD 1 Large backlog of signed Pharma contracts 17
Slide 18: Global Strategic Alliance With PPD
Global Strategic Alliance With PPD PPD’s preferred lab for oncology testing Significant revenue opportunity Expands global client base Expansion into Asia Collaborations for companion diagnostics Opportunities to leverage laboratory data for trials 18
Slide 19: A New Standard in Oncology Testing
A New Standard in Oncology Testing NeoGenomics Well established as a leading provider of oncology testing for pathologists and hospitals Genoptix Unprecedented reach to all customer segments Broadest and deepest test menu in the Industry Outstanding reputation Deep knowledge of community oncol
Slide 20: Expands Reach into Oncology Practices
Expands Reach into Oncology Practices Significant opportunity Genoptix is well established in for growth this market segment $2.5 billion revenue 40 person oncologist-focused sales opportunity force (5x larger than NeoGenomics’ current oncology team) >2,000 independent, Customized reports specifical
Slide 21: Leverages Best Offerings
Leverages Best Offerings MANAGED CARE CUSTOMIZED EXTENSIVE PHARMA NATIONAL AND GPO REPORTING TEST MENU SERVICES FOOTPRINT CONTRACTS NeoGenomics’ test Synergistic With operations on NeoGenomics Genoptix has a menu includes many pharma services both coasts, has a broad suite of tests that Genoptix bus
Slide 22: COMPASS® and CHART®
COMPASS® and CHART® COMPASS: comprehensive, hematopathologist-directed, integrated assessment report • Customized workflow on each patient case to provide a disease-specific evaluation based on up-to-date guidelines • Actionable diagnosis in a one-page correlation report • Consultation with assigned
Slide 23: Genoptix Bends the Curve
Genoptix Bends the Curve Potential Revenue $500 • Incremental revenue of $80-85M • Pro form combined revenue of ~$350M $400 • ~$25 million of cost synergies • ~25% EBITDA on incremental revenue by end of year three $300 $200 2018 2019 2020 2021 Pre Post Potential EBITDA $110 $90 $70 Note: graphs and
Slide 24: Investment Highlights
Investment Highlights Leading pure-play oncology testing company Significant market growth tailwinds Extensive molecular/oncology test menu Leader in immuno-oncology testing Market share gains driven by customer satisfaction Rapidly growing Pharma Services business Track record of profitable growth
Slide 25: Appendix
Appendix {NEO
Slide 26: Balance Sheet, December 31, 2018
Balance Sheet, December 31, 2018 (unaudited, in thousands) December 31, 2017 ASSETS December 31, 2018 (Restated) $ 12,821 Cash and cash equivalents $ 9,811 12,821 Accounts receivable 76,919 60,427 Inventory 8,650 7,474 Other current assets 8,288 5,153 Total current assets 103,668 85,875 Property and
Slide 27: Income Statement, December 31, 2018
Income Statement, December 31, 2018 (unaudited, in thousands) For the Three Months Ended For the Year Ended December December 31, 31, 2017 2017 2018 (Restated) 2018 (Restated) Net Revenue: Clinical testing $ 65,913 $ 53,456 $ 241,873 $ 213,097 Pharma services 10,562 7,966 34,868 27,154 Total revenue
Slide 28: Statements of Cash Flows, December 31, 2018
Statements of Cash Flows, December 31, 2018 (unaudited, in thousands) For the Year Ended December 31, CASH FLOWS FROM OPERATING ACTIVITIES 2018 2017 (Restated) Net income (loss) $ 2,640 $ (396) Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation 15,8
Slide 29: Segment Results, December 31, 2018
Segment Results, December 31, 2018 (unaudited, in thousands) Three Months Ended December 31, Year Ended December 31, 2017 % (Restated) Change 2017 % Pharma Operations: 2018 2018 (Restated) Change Pharma Revenue $ 10,562 $ 7,966 32.6 % $ 34,868 $ 27,154 28.4 % Cost of Revenue $ 5,654 $ 4,730 19.5 % $
Slide 30: Adjusted EBITDA, December 31, 2018
Adjusted EBITDA, December 31, 2018 (unaudited, in thousands) For the Three Months For the Year Ended Ended December 31, December 31, 2017 2017 (Restated) (Restated) 2018 2018 Net Income (Loss) (GAAP) $ 353 $ 4,549 $ 2,640 $ (396) Adjustments to Net Income (Loss): Interest expense, net 1,464 1,368 6,
Slide 31: 2019 Guidance
2019 Guidance (unaudited, in thousands) For the Year Ended December 31, 2019 Range Net income (loss) attributable to common stockholders (GAAP) $ (3,000) $ 3,000 Amortization of intangibles 11,000 11,000 Non-cash, stock-based compensation (4) 8,000 7,000 Acquisition and integration related expenses
Slide 32: Quarterly Impact of ASU Adoption
Quarterly Impact of ASU 606 Adoption (unaudited, in thousands) As Previously Reported Q1 2017 Q2 2017 Q3 2017 Q4 2017 Total 2017 Net Revenue Clinical Testing $ 56,690 $ 59,791 $ 56,186 $ 59,079 $ 231,748 Pharma Services 4,986 6,299 6,866 8,713 26,863 Total Revenue 61,676 66,090 63,052 67,792 258,611
Slide 33: NeoGenomics
(NEO GENOMICS