Axogen, Inc. · NASDAQ:AXGN
Axogen — Investor Presentation (November 2012)
27 slides from Axogen's investor presentation, November 2012
Slide 1: Investor Presentation
Investor Presentation November 2012 1
Slide 2: Safe Harbor and Regulatory Statements
Safe Harbor and Regulatory Statements Safe Harbor: This Presentation contains “forward-looking” statements as defined in the Private Securities Litigation Reform Act of 1995. These statements are based on management’s current expectations or predictions of future conditions, events or results based
Slide 3: Company Overview
Company Overview bringing the science of nerve repair _,|/TOLIFE © AxoGen aay
Slide 4: Highlights
Highlights • AxoGen is a regenerative medicine technology company offering a complete portfolio of surgical solutions for peripheral nerve repair and AxoGen Corporation was reconstruction: incorporated in 2002 and is located in Alachua, Florida Current Market Cap $31 Million (as of 11.07.12) Revenue
Slide 5: Management Team
Management Team Karen Zaderej President & CEO J&J (Ethicon) Greg G. Freitag, J.D., CPA CFO, General Counsel Guidant, Pfizer VP of of Regulatory Affairs & Quality AtriCure, Enable Mark Friedman, Ph.D. Assurance Medical J&J, Jill Schiaparelli SVP Business Strategy & Marketing ApaTech/Baxter John Engel
Slide 6: Peripheral Nerve Injuries
Peripheral Nerve Injuries Guides Natural Nerve Regeneration Process Peripheral nerves provide the pathways for both motor and sensory signals between the central nervous system and target organs, regulating movement and sensation • Successful nerve regeneration dependent on – Structure and guidance:
Slide 7: Causes & Incidence of Nerve Injuries
Causes & Incidence of Nerve Injuries Injuries vary and can affect outcomes AxoGen Technology Causes of Peripheral Nerve Injuries include Applications • Power tool / saw accidents • Motor vehicle accidents • Battle field injuries • Carpal tunnel Erb’s Palsy Lacerated Hand • Lacerations • Dislocations
Slide 8: Current U.S. Addressable Market: $1BLN
Current U.S. Addressable Market: $1BLN Carpal U.S. nerve repair market potential Tunnel • Majority of traumatic injury grafting Oral 14% opportunities are focused in small number of Surgery accounts 5% • Currently <1% U.S. market penetration • ROW at least equals U.S. market potential Trauma • Marke
Slide 9: Autograft Characteristics
Autograft Characteristics Patient sacrifices nerve function at the donor site • Traditional “Gold Standard” for peripheral nerve repair • Requires secondary surgery on patient to harvest healthy donor nerve (typically the sural nerve) • Patient loses function and sensation at the nerve harvest site
Slide 10: Autograft Fiscal Considerations
Autograft Fiscal Considerations Eliminates Need for a Costly Secondary Surgery Time value for procurement of harvested nerve Estimated Cost of Autograft Harvest • Autograft harvest adds 30 - 60 minutes to the surgical procedure $2,400 - $4,800 and increases the OR costs by $80/min $2,400 to $9,000 P
Slide 11: Hollow-Tube Conduit
Hollow-Tube Conduit • Hollow-tube used to bridge nerve gaps and provide gross direction for re- growth • Lacks internal structure; reliant on fibrin bridge to support regenerating nerve fibers • Use limited to small gaps; 34%-57% failure rate >5mm gaps1 • Reliability of repair diminishes at longer g
Slide 12: AxoGen's Innovative Solutions
AxoGen’s Innovative Solutions Regenerative medicine products Avance® Nerve Graft is a decellularized typically consist of: and sterile ECM scaffold processed from • Scaffold: The structure of human peripheral nerve tissue ExtraCellular Matrix (ECM) to support the cells and/or provide the architectur
Slide 13: Avance Nerve Graft
Avance® Nerve Graft • Decellularized and cleansed human nerve allograft • Three dimensional scaffold (preserving the micro architecture of nerve) for bridging a nerve gap • Allows the body’s natural healing process to regenerate the nerve • Handles similar to an autograft without the 25 µm loss of d
Slide 14: Avance Nerve Graft Tissue Processing
Avance® Nerve Graft Tissue Processing Provides a sterile implant; no supply constraints Recovery of donor nerve tissue Tissue processing CSPGs Clearance Enzyme Wash Buffer Wash Chemical Decellularization Detergent Wash Buffer Wash Sterilization Gamma Irradiation Avance® Nerve Graft AxoGen is the onl
Slide 15: Avance Nerve Graft Clinical Study Results
Avance® Nerve Graft Clinical Study Results RANGER® Study: Meaningful Recovery in 87% of nerve reconstructions* Injuries Achieving Meaningful Treatment response by Treatment response based on Recovery* injury/gap length** time from injury to repair** 100% 100% 100% 100% 93% 75% 89% 85% 75% 98% 85% 85
Slide 16: Study Results Compare Favorably to Other Repairs
Study Results Compare Favorably to Other Repairs Comparison to Historical Reference Literature Autograft vs. Avance Motor Study Nerve Injury Types Test Article Positive Recovery Outcomes in Mixed and Outcomes* Motor Nerves 100 % Successful Recovery RANGER® Study 78% First Data Sensory, Mixed and 75%
Slide 17: AxoGuard Family of Products
AxoGuard® Family of Products 25 µm AxoGuard® offers the following • Allows the body’s natural healing Reinforce a coaptation process to repair the nerve Coaptation aid allowing site, wrap a partially close approximation of severed or injured nerve • Separates and protects the nerve from severed nerv
Slide 18: Few Competitors
Few Competitors AxoGen Products Cover the Entire Range mm gap 70 Autograft Only Extracellular Matrix 65 Wrap up to 40mm 60 55 50 45 40 35 30 Although conduit use has grown, 25 autografts still represent significant 20 portion of short gap market 15 Undifferentiated conduits marketed: 10 • Baxter 5 •
Slide 19: Competitive Advantage
Competitive Advantage AxoGen is protected by a • Innovative & Leading Patents strong, strategically designed – 6 issued U.S. patents; 5 pending U.S. patent portfolio of intellectual property applications; 12 pending international patent applications Products are distributed • FDA 510(k) clearance in
Slide 20: Financial Overview
Financial Overview bringing the science of nerve repair _ »/TOLIFE © AxoGen aay
Slide 21: Revenue Growth Strong, Consistent
Strong, Consistent RevenuesRevenue Growth +60% $5.6 $4.8 60% Growth from 2010 to 2011 $3.0 +74% $2.0 $1.1 74% 3Q11compared to 3Q12 3Q11 3Q12 2010 2011 YTD 2012 Quarterly Annually 21
Slide 22: Strong, Stable Gross Profit & Margins
Strong, Stable Gross Gross Profit Profit & Margins +75% $4.2 75% YTD 2012 increase over $2.4 YE 2011 +74% $1.6 $1.4 73% 3Q12 Gross $.010 profit margins 3Q11 3Q12 2010 2011* YTD 2012 Quarterly Annually *Excludes one-time write-off of inventory 22
Slide 23: Capital Structure: Investors
Capital Structure: Investors Simple flat cap structure and experienced investors (DeNovo Ventures, Cardinal Partners, AMV Partners, Springboard Capital, ATEL Ventures & LecTec shareholders) Common Stock Outstanding 111,122,576 shares Common Stock Option 1,981,148 shares Common Stock Warrant 89,686 s
Slide 24: Summary Balance Sheet
Summary Balance Sheet Sept. 30, 2012 Dec. 31, 2011 Select Balance Sheet Items: Cash & Cash Equivalents $4,445 $8,190 Total Current Assets $8,183 $10,883 Total Assets $9,694 $12,495 Accounts payable $1,864 $1,585 Current portion of long-term debt $1,886 $435 Long-term debt $4,739 $4,404 Total Liabili
Slide 25: Capitalized for growth
Capitalized for growth $20.8 $5.0 $15.8M Cash available $15.8 as of 11.01.12 $0 Total bank debt outstanding PDL Repaid Cash-on-hand Financing Debt 25
Slide 26: Highlights
Highlights • AxoGen is a regenerative medicine technology company offering a complete portfolio of surgical solutions for peripheral nerve repair and AxoGen Corporation was reconstruction: incorporated in 2002 and is located in Alachua, Florida Current Market Cap $31 Million (as of 11.07.12) Revenue
Slide 27: OTCBB: AXGN
OTCBB: AXGN investorrelations@axogeninc.com 27