Mimedx Group, Inc · NASDAQ:MDXG
Mimedx — 2021 J.P. Morgan 39th Annual Healthcare Conference
42 slides from Mimedx's conference presentation, Jan 11, 2021
Slide 1: Innovating Treatments Through Advanced Placental Science
Exhibit 99.1 INNOVATING TREATMENTS THROUGH ADVANCED PLACENTAL SCIENCE January 11-14, 2021 2021 J.P. Morgan 39th Annual Healthcare Conference 1Exhibit 99.1 INNOVATING TREATMENTS THROUGH ADVANCED PLACENTAL SCIENCE January 11-14, 2021 2021 J.P. Morgan 39th Annual Healthcare Conference 1
Slide 2: Important Cautionary Statement
IMPORTANT CAUTIONARY STATEMENT This presentation contains forward-looking statements. Investors are cautioned against placing undue reliance on these statements. All statements relating to events or results that may occur in the future are forward-looking statements, including, without limitation, s
Slide 3: Important Cautionary Statement (Cont.)
IMPORTANT CAUTIONARY STATEMENT (CONT.) Forward-looking statements generally can be identified by words such as “expect,” “will,” “change,” “intend,” “seek,” “target,” “future,” “plan,” “continue,” “potential,” “possible,” “could,” “estimate,” “may,” “anticipate,” “to be” and similar expressions. The
Slide 4: Leading Product Portfolio Positioned for Growth
LEADING PRODUCT PORTFOLIO POSITIONED FOR GROWTH $1.1B 84% $256M 3 2 1 Market Cap Gross Margin TTM Net Sales 265+ 2,000,000+ 725+ 4 5 Field Sales Allografts Distributed Employees 5 Personnel Reimbursement 30M (U.S.) $6.2-$18.7B coverage, U.S.: 6 8 with diabetes Medicare cost of DFU/yr • 5-year shelf
Slide 5: From Transformation to Investment
FROM TRANSFORMATION TO INVESTMENT Positioning for pipeline Investing acceleration in core business for growth Focusing capital on strategic initiatives 5FROM TRANSFORMATION TO INVESTMENT Positioning for pipeline Investing acceleration in core business for growth Focusing capital on strategic initiat
Slide 6: MiMedx Is a Pioneer in Placental Biologics
MIMEDX IS A PIONEER IN PLACENTAL BIOLOGICS Promising Late- Core Business Stage Pipeline Distinct drivers of significant shareholder value with current and future growth potential 6MIMEDX IS A PIONEER IN PLACENTAL BIOLOGICS Promising Late- Core Business Stage Pipeline Distinct drivers of significant
Slide 7: Differentiated Platform Positioned to Exceed Market Growth
DIFFERENTIATED PLATFORM POSITIONED TO EXCEED MARKET GROWTH All amniotic products are not the same • Shelf-stable with 5-year shelf life • Human-derived, immunologically privileged & terminally sterilized • Full vertical integration with scalable donation & recovery network • Peer-reviewed, published
Slide 8: Investments in CGMP Manufacturing Enhance Competitive Advantages
INVESTMENTS IN CGMP MANUFACTURING ENHANCE COMPETITIVE ADVANTAGES Rigorous regulatory standards from tissue donation to final product benefit entire portfolio and ensure consistency and controls throughout manufacturing process Final Release Shelf-Stable Testing, including Packaged Purity, Potency Pr
Slide 9: Robust Commercial Infrastructure Differentiates Field Sales Force
ROBUST COMMERCIAL INFRASTRUCTURE DIFFERENTIATES FIELD SALES FORCE Q3 2020 Revenue (TTM) In-patient 29% Private Reimbursement Office coverage, U.S. 29% Out-patient 300M+ lives 30% Other 12% • 265+ field sales personnel supported by an • Product attributes are easily integrated into expanding Medical
Slide 10: Near-Term Investments Prioritize 10%+ Field Sales Team Expansion
NEAR-TERM INVESTMENTS PRIORITIZE 10%+ FIELD SALES TEAM EXPANSION Core Business Increase Market Capture Invest to Enhance Opportunity Disproportionate Commercial Share Excellence Model 2 3 1 10NEAR-TERM INVESTMENTS PRIORITIZE 10%+ FIELD SALES TEAM EXPANSION Core Business Increase Market Capture Inves
Slide 11: Targeted Investment for Geographic Expansion
TARGETED INVESTMENT FOR Current primary market GEOGRAPHIC EXPANSION 1-2 year expansion 2-3 year expansion JAPAN UK GERMANY Total Wound Care Market ~$430M ~$380M ~$740M DFU + VLU (patients) 650K 225K 500K MiMedx Addressable Market (patients) 100K 35K 80K Anticipated Approval Status Approved Approved
Slide 12: 2021 Investments Represent Significant Increase in R&D
2021 INVESTMENTS REPRESENT SIGNIFICANT INCREASE IN R&D TO SUPPORT CORE MARKET AND PIPELINE GROWTH OBJECTIVES Core Business Pipeline PROTECT GROW CORE PRODUCT ADVANCE EXISTING AREAS BUSINESS INNOVATION TIMELINE TO BLA OF USE BLA = Biologics License Application 122021 INVESTMENTS REPRESENT SIGNIFICANT
Slide 13: Investments in R&D Position Us to Accelerate Program Timelines
INVESTMENTS IN R&D POSITION US TO ACCELERATE PROGRAM TIMELINES Synergistic activities contribute to overall BLA program efficiencies Est. BLA Filing Est. BLA Approval Plantar Fasciitis PH 3 FDA Meeting Phase 3 Initiation Est. BLA Filing Est. Launch Knee Osteoarthritis PH 2 PH 3 2020 2021 2022 2023 2
Slide 14: Increasing Optimism in Pipeline as a Platform Technology
INCREASING OPTIMISM IN PIPELINE AS A PLATFORM TECHNOLOGY 1,2 § Promising retrospective data § Phase 2B Plantar Fasciitis trial demonstrated statistically significant benefit in pain and function § Phase 2B Knee Osteoarthritis trial: § Drop-out rates lower than expected § Additional dosing potential
Slide 15: Financial Strength Fortifies Sustainable and Profitable Growth
FINANCIAL STRENGTH FORTIFIES SUSTAINABLE AND PROFITABLE GROWTH 1 Net Cash at 9/30/2020 Adjusted Net Sales Adjusted EBITDA as % of 2 Adjusted Net Sales $62M $241M 1 Days Sales Outstanding Adjusted Gross Margin at 9/30/2020 15.6% 14.3% 14.3% 83.8% 43 days 14.6% 13.2% Net Loss (TTM) Inventory Levels 3Q
Slide 16: 2021 Top-Line Growth with Significant Investments in Growth Drivers
2021 TOP-LINE GROWTH WITH SIGNIFICANT INVESTMENTS IN GROWTH DRIVERS Outlook for 2021 consistent with growing in excess of market 1 Enforcement Discretion: Full Impact No Impact 2 2 2021 Net Sales $235-250M $255-270M Investing proceeds from Plan to increase sales mid-2020 capital raise in professiona
Slide 17: Investments Position Accomplishment of 2021 Growth Drivers
INVESTMENTS POSITION ACCOMPLISHMENT OF 2021 GROWTH DRIVERS q Top-line growth >10% (excludes potential impact of enforcement discretion) q Sales force growth >10% Commercial q Japan approval q Pursue organic and inorganic growth opportunities Operations q CGMP compliance q Interim data readouts (PF/K
Slide 18: From Transformation to Investment
FROM TRANSFORMATION TO INVESTMENT Positioning for pipeline Investing acceleration in core business for growth Focusing capital on strategic initiatives 18FROM TRANSFORMATION TO INVESTMENT Positioning for pipeline Investing acceleration in core business for growth Focusing capital on strategic initia
Slide 19: Question & Answer Session
QUESTION & ANSWER SESSION 19QUESTION & ANSWER SESSION 19
Slide 20: Appendix
APPENDIX 20APPENDIX 20
Slide 21: Experienced Leadership Team
EXPERIENCED LEADERSHIP TEAM TIMOTHY R. WRIGHT PETE CARLSON BUTCH HULSE ROHIT KASHYAP, PhD ROBERT STEIN, MD, PhD Chief Executive Chief Financial General Counsel Chief Commercial EVP, Research Officer Officer & Secretary Officer & Development MARK ROGERS SCOTT TURNER MARK GRAVES JACK HOWARTH STAN MICE
Slide 22: Experienced Board of Directors
EXPERIENCED BOARD OF DIRECTORS M. KATHLEEN BEHRENS, Ph.D . JAMES L. BI E R MA N MICHAEL J. GIULIANI, M.D. WILLIAM A. HAWKINS I I I CATO T. LAURENCIN, M.D., Ph.D. K. TODD N EW T ON MARTIN P. S U TTE R TIMOTHY R. WR I G H T 22EXPERIENCED BOARD OF DIRECTORS M. KATHLEEN BEHRENS, Ph.D . JAMES L. BI E R M
Slide 23: Continued Progress to Resolve Remaining Legal Contingencies
CONTINUED PROGRESS TO RESOLVE REMAINING LEGAL CONTINGENCIES • Audit Committee investigation concluded in Q2 2019 • Financial restatement completed at end of Q2 2020 Investigation, Restatement • Two additional matters resolved in principle Q4 2020 and Related Expense: Investigation Restatement Legal
Slide 24: Material Litigation Closure Update
MATERIAL LITIGATION CLOSURE UPDATE 12 of 15 “Material Litigation” matters disclosed in 2019 Form 10-K now resolved Matters Resolved in Last 16 Months Matters Pending Timing of Matter Type of Matter Matter Type of Matter Resolution Two Cases to Compel Securities Litigation Civil Class Action Annual M
Slide 25: Regulatory Environment Overview
REGULATORY ENVIRONMENT OVERVIEW 361 351 Human Tissue (i.e., When minimally When more than minimally placental tissue) manipulated manipulated Indication for use Homologous use* As indicated by clinical trial Manufacturing process CGTP CGMP FDA Oversight Regulated by the FDA for Approved by the FDA f
Slide 26: Clinical Evidence Demonstrates Differentiation & Supports Reimbursement
CLINICAL EVIDENCE DEMONSTRATES DIFFERENTIATION & SUPPORTS REIMBURSEMENT ** BEST-IN-CLASS CLINICAL EVIDENCE • Statistically significant results* • Randomized controlled trials across multiple applications • Head-to-head study results demonstrate superior clinical outcomes & substantially lower cost-t
Slide 27: Clinical Study Summary
CLINICAL STUDY SUMMARY STUDY RESULT Complete Wound Closure: 1 EpiFix DFU RCT Study 92% at 6 weeks (p=.001) Overall Complete Wound Closure: EpiFix DFU RCT – Weekly vs. Biweekly 92.5% healing in 12 weeks 2 Application Mean time to Healing: – Weekly applications: 2.4 weeks – Biweekly applications: 4.1
Slide 28: Late-Stage Pipeline Aimed at Sizable Markets
LATE-STAGE PIPELINE AIMED AT SIZABLE MARKETS Potential to address unmet patient needs as a platform technology across multiple markets MUSCULOSKELETAL/SPORTS MEDICINE 1H 2022 PHASE 3 Plantar Fasciitis Est. BLA filing 2H 2021 Achilles Tendonitis PHASE 3 Est. BLA filing* 2H 2024 / 1H2025 PHASE 2 Knee
Slide 29: PF Study Informs Safety, Efficacy and Other Future Indications
PF STUDY INFORMS SAFETY, EFFICACY AND OTHER FUTURE INDICATIONS Plantar Fasciitis (PF) 2M+ 200K+ U.S. Patients treated Candidates for 1 2 for PF annually advanced therapies Current Treatments ~20K-50K • Conservative (RICE/NSAIDS) Potential candidates • Custom orthotics • Corticosteroid injections for
Slide 30: Phase 2B Study Demonstrates Significant Benefit
PHASE 2B STUDY DEMONSTRATES SIGNIFICANT BENEFIT • Primary Efficacy Endpoint: reduction in VAS (visual analog scale) score for pain (p<0.0001) • Secondary Efficacy Endpoint: improvement in FFI-R (Foot Function Index-Revised) score (p=0.0004) • At 3-month follow-up visit, average reduction VAS score f
Slide 31: Plantar Fasciitis (PF) Current Status
PLANTAR FASCIITIS (PF) CURRENT STATUS Phase 2B study completed Phase 3 study enrollment completed • 277 patients in September 2020 • Last patient out in Q2 2021 Potential timeline* • Meeting with FDA mid-2021 • BLA filing 1H 2022 • FDA approval and product launch 1H 2023 PF Study Informs Safety, Eff
Slide 32: Gaps in Current Treatment Options Provide Opportunity
GAPS IN CURRENT TREATMENT OPTIONS PROVIDE OPPORTUNITY TO ADVANCE NON-SURGICAL TREATMENT ALGORITHM Knee Osteoarthritis (KOA) 8.8 million >17.5 million intra-articular injections across U.S. KOA patients 1 2,3 (growing 2% per year) 4.4 million patients Current Treatments ~1M-1.5M • Corticosteroid inje
Slide 33: Injectable dHACM in the Treatment of Knee Osteoarthritis
INJECTABLE DEHYDRATED HUMAN AMNION/CHORION MEMBRANE (dHACM) IN THE TREATMENT OF KNEE OSTEOARTHRITIS Kris Alden, MD, PhD, Hinsdale Orthopaedics, Hinsdale, IL Retrospective study provided insight into potential for reducing pain and improving function Purpose Results To present our clinical experience
Slide 34: Results of Retrospective Study by Dr. Kris Alden
RESULTS OF RETROSPECTIVE STUDY BY DR. KRIS ALDEN INDICATE SIGNIFICANT BENEFIT FROM mdHACM INJECTIONS KOOS Subscales (Mean % Increase) over Time 140% 120% Daily Living Pain Quality of Life 100% Sports/Recreation Symptoms Overall KOOS 80% 60% 40% 20% 0% Pre-Injection 6 Weeks 3 Months 6 Months Source:
Slide 35: Knee Osteoarthritis (OA) Current Status
KNEE OSTEOARTHRITIS (OA) CURRENT STATUS Phase 2B study ongoing • Enrollment completed September 2020 - Completed early, despite COVID-19 challenges - 447 patients enrolled - Drop-out rates lower than expected – 3% actual compared to 10% anticipated Critical success factors • Last Patient Out for 6-m
Slide 36: Intellectual Property Overview
INTELLECTUAL PROPERTY OVERVIEW 12 issued PATENT PORTFOLIO OVERVIEW 1 pending • Domestic patents issued: 97 • Domestic patents pending: 39 1 issued • Foreign patents issued: 99 1 pending • Foreign patents pending: 54 FENESTRATED ISSUED PATENTS BY 16 issued TECHNOLOGY CATEGORY 1 pending • Placental Ti
Slide 37: Adjusted Net Sales Trends Reflect Stabilization Post COVID-19 Downturn
ADJUSTED NET SALES TRENDS REFLECT STABILIZATION POST COVID-19 DOWNTURN Revenue presentation includes impact of 2019 transition in revenue recognition $89 ($ millions) $76 $68 $67 $67 $67 $67 $67 $64 $63 $62 $57 $54 $52 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 1 Net Sales Adjusted Net Sales (1) Adjusted Ne
Slide 38: Summary Balance Sheets
SUMMARY BALANCE SHEETS Unaudited 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 ($ millions) Assets Cash and Cash Equivalents 28.4 96.9 94.1 69.1 53.5 48.2 109.6 Accounts Receivable, net 0.0 0.0 21.4 32.3 31.9 30.1 33.0 Inventory, net 16.4 15.0 12.0 9.1 9.2 10.6 11.0 Other Current Assets 12.4 10.6 6.5 12.7 21.2
Slide 39: Summary Income Statements
SUMMARY INCOME STATEMENTS Unaudited 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 ($ millions) Net Sales 66.6 67.4 88.9 76.4 61.7 53.6 64.3 Cost of Sales 7.4 9.7 13.2 12.7 10.0 8.2 10.3 Gross Profit 59.1 57.7 75.7 63.7 51.7 45.4 54.0 Research & Development 2.9 2.8 2.7 2.7 2.7 2.3 3.4 Selling, General, and Admi
Slide 40: Summary Cash Flow Statements
SUMMARY CASH FLOW STATEMENTS Unaudited 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 ($ millions) Net (Loss) Income (13.3) (17.2) 12.4 (7.5) (4.8) (8.5) (19.4) Effect of Change in Revenue Recognition 0.0 0.0 (17.4) 0.0 0.0 0.0 0.0 Share-Based Compensation 3.0 3.5 2.7 2.9 3.3 4.4 3.7 Depreciation 1.7 1.6 1.6 1.
Slide 41: Non-GAAP Metrics Reconciliation
NON-GAAP METRICS RECONCILIATION Unaudited ($ millions) 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 Net Sales – Reported $ 66.6 $ 67.4 $ 88.9 $ 76.4 $ 61.7 $ 53.6 $ 64.3 1 ── 21.5 8.2 4.5 1.7 1.0 Less: Revenue Transition Impact Adjusted Net Sales $ 66.6 $ 67.4 $ 67.3 $ 68.2 $ 57.2 $ 51.9 $ 63.3 $ 59.1 $ 57.7
Slide 42: Adjusted EBITDA Reconciliation
ADJUSTED EBITDA RECONCILIATION ($ millions) 4Q19 1Q20 2Q20 3Q20 Net Loss (7.5) (4.8) (8.5) (19.4) Depreciation & Amortization 1.8 1.8 1.7 1.8 Interest Expense 2.4 2.4 2.6 1.5 Loss on Extinguishment of Debt 0.0 0.0 0.0 8.2 Income Tax 0.2 (11.3) 0.0 0.0 EBITDA (3.0) (12.0) (4.2) (7.9) Investigation, R
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