Quidelortho Corporation · NASDAQ:QDEL
Quidelortho — Quidel — Bank of America Merrill Lynch 2015 Health Care Conference
26 slides from Quidelortho's conference presentation, May 12, 2015
Slide 1: Investor Presentation
Investor Presentation Doug Bryant, President & CEO
Slide 2: Forward-looking statements
Forward-looking statements This presentation contains forward-looking statements within the meaning of the federal securities laws that involve material risks, assumptions and uncertainties. Many possible events or factors could affect our future financial results and performance, such that our actu
Slide 3: Traditional healthcare is changing
Traditional healthcare is changing Current healthcare trends include: Total National Health Expenditures (1980-2012)1 • Increased access points for healthcare • Investment in healthcare technology • Informed patient -> consumerism • Expanded clinical roles for nurse practitioners, nurses, physician
Slide 4: Quidel is developing new products that can compete in the evolving healthcare environment
Quidel is developing new products that can compete in the evolving healthcare environment Diagnostic products will need to be connected as compliance, access to testing data and the handling of those data will increase in importance. Assays will need to be faster and easier to use as testing moves i
Slide 5: Quidel is…
Quidel is… A market leader in the development of innovative medical diagnostic platforms… • Traditional and Next-generation Immunoassays, • Cellular-Based Virology assays, and • Versatile Molecular Diagnostic platforms …that is focused on delivering smart, connected new products with low instrument
Slide 6: Quidel – building on a history of innovation
Quidel – building on a history of innovation $200 Revenue ($, in millions) 2009 – Present Submitted over 25 510(k) packages to the FDA, 18 FDA clearances, 4 CLIA waiver designations. $180 $182.6 Launched Sofia and 4 FDA-cleared assays. $175.4 Launched 2 molecular systems (AmpliVue & Lyra) $160 $158.
Slide 7: Quidel's experienced management team is assembled to win
Quidel’s experienced management team is assembled to win Douglas C. Bryant President and Chief Executive Officer Served as Executive Vice President and Chief Operating Officer, Luminex Corporation, Vice President of Abbott Vascular for Asia/Japan, Vice President of Abbott Molecular Global Commercial
Slide 8: Our strategic intent
Our strategic intent Build a broader-based diagnostic company that delivers revenue and margin more consistently. Develop technologies and products that give us access to market segments that are significantly larger. Solidify price and volume in core business while expanding into molecular. Create
Slide 9: The strategy behind our new product development is two-fold
The strategy behind our new product development is two-fold For Immunoassays: protect and expand our Core Business through the development of compelling and connected next-generation assays that deliver more value to the customer and provide greater, more consistent margin to our business For Molecu
Slide 10: Since 2011, Quidel has submitted over 25 510(k) packages resulting in 18 FDA clearances
Since 2011, Quidel has submitted over 25 510(k) packages resulting in 18 FDA clearances, 4 CLIA-waiver designations and numerous product introductions FDA- cleared Products since 2011 Sofia® Instrumented AmpliVue® HDA Lyra® Real-Time PCR Immunoassay Isothermal Molecular Molecular CLIA- Mod- Waived S
Slide 11: Near-term growth opportunities come from commercialization of new products
Quidel’s near-term growth opportunities come from the commercialization of new products and longer-term, from products in development. FY2015 - FY2018: Capture $100M+ Instrumented Solana and in total Sofia and MDx revenue; Savanna capture MDx market 30K Sofia placements; share in low-volume labs wit
Slide 12: New product sales from Sofia and MDx products are driving growth
Today, new product sales from Sofia and MDx products are driving Quidel’s growth. In just 2 years, revenue from new products has grown to 21% of total revenues 4% New Products 140% CAGR from Core Core 21% New Products Business Business 79% 96% $155.7M $182.6M FY 2012 Revenue FY 2014 Revenue 12 Reven
Slide 13: Our new products are designed to meet the various needs of the customer
Our new products are designed to meet the various needs of the customer Sofia Immunoassay platform is the next generation, objectively-read system in support of FDA- our legacy lateral flow business, designed to deliver more value and a higher gross margin. cleared, CLIA- Sofia captures market share
Slide 14: Sofia is a compelling next-generation rapid immunoassay system
From a customer perspective, Sofia is a compelling next- generation rapid immunoassay system • FDA-cleared and CLIA-waived instrument and assays • Objectively read result, with many fail-safe and data management features • Improved accuracy and performance relative to traditional rapid point of care
Slide 15: Virena adds another dimension of functionality to Sofia
Virena adds another dimension of functionality to Sofia Can utilize cellular to transmit/gather/analyze de-identified testing data by test type, facility, result, etc. Map and monitor respiratory disease incidence at the local or national level in near real-time. Remotely manage and view instrument
Slide 16: Molecular products evolving into instrumented molecular systems
Quidel’s molecular products are evolving from introductory offerings into more sophisticated instrumented molecular systems In-market MDx products MDx systems in development HDA & Assay Menu AmpliVue Solana Isothermal HDA technology Isothermal HDA instrumented in a hand-held disposable format System
Slide 17: AmpliVue introduces Quidel's molecular brand to the lower-volume hospital segment
AmpliVue introduces Quidel’s molecular brand to the lower-volume segment of the hospital market AmpliVue features and benefits Uses our proprietary HDA technology Non-instrumented, hand-held disposable cartridge Performance rivals that of high-cost systems in terms of accuracy Results in 55-80 minut
Slide 18: Lyra Real-time PCR assays offer advantages to higher throughput labs
Quidel’s Lyra® Real-time PCR assays offer several advantages to the higher throughput labs Lyra MDx features and benefits Lyra assay workflow Simplified workflow as compared to LDT and other on-market assays. Superior sensitivity and specificity. Results in approx. 75 minutes. FDA clearance on multi
Slide 19: Lower end of the IVD market's move to molecular methods; Solana
The lower end of the IVD market’s move to molecular methods has been greatly hampered by the lack of access to capital and the cost of molecular reagents. Solana’s low COGS solves this The typical U.S. Solana customer Would move to a molecular method New Solana Strep A+C/G Assay for targets that d
Slide 20: Lower end of the U.S. hospital lab market is under-penetrated by integrated MDx platforms
The lower end of the U.S. hospital lab market is significantly under-penetrated by fully integrated MDx platforms 790 4110 U.S. Hospitals < 400 Beds The typical U.S. Savanna customer Is one of 4110 hospitals < 400 beds without a sample-to-answer MDx platform Concern with cost has delayed move to
Slide 21: Savanna and Solana initial menu designed to deliver test volume
Savanna and Solana initial menu is designed to deliver the test volume needed for a profitable reagent agreement plan Desired Assay Requirements Solana Savanna (Assays and systems are currently in development) HDA PCR HDA Sample extraction X X Quantitation X Fast Time-to-Results X X Random Access X
Slide 22: We are on a path to our longer term financial objectives
We are on a path to our longer term financial objectives 2. Invest in the 1. Achieve low- to mid- development and teens in annual revenue commercialization of new growth through new products driving gross product introductions. margins to exceed 65%. 3. Leverage operational 4. Maximize cash flow eff
Slide 23: Quidel financial overview
Quidel financial overview Revenue Adjusted EBITDA (1) (in $ million, percent gross margin in white) (adjusted, in $ million) $200 $182.6 110% $175.4 $45 $40.9 $40.6 $180 $38.9 $158.6 $155.7 90% $40 $160 $35 $140 70% $30 $27.9 $120 $113.3 $25 $100 61% 62% 59% 50% 60% $80 54% $20 30% $15 $60 $40 $10 1
Slide 24: 2015 expected operating cost structure
2015 expected operating cost structure Annual Investment: R&D Annual Investment: S&M (in $ million; percentage of sales in white) (in $ million; percentage of sales in white) $50 Range 65% $45 Range 65% $45-$47 $40-$42 $45 $40 $41.5 55% $37.9 55% $40 $35 $34.2 45% $35 $33.8 45% $30 $30.3 $27.7 $26.3
Slide 25: Growth drivers and milestones for 2015
Growth drivers and milestones for 2015 • Expand Sofia installed base through commercialization of CLIA-waived Sofia Strep A • Receive CLIA waiver for Sofia hCG • Continue Sofia conversions from visually-read lateral flow products • Submit 510(k) package to the FDA for Quantitative Vitamin D • Grow r
Slide 26: In summary…
In summary… In a relatively short amount of time, Quidel has demonstrated its ability to bring to market innovative new rapid immunoassays and molecular diagnostic products with low COGS. New product revenue from FDA-cleared assays (Sofia, Lyra and AmpliVue) is contributing to top-line growth and ma
Quidel — Bank of America Merrill Lynch 2015 Health Care Conference on 6ix