Slide 1: Investor Presentation
Investor Presentation Greg Gubitz | CEO Gilbert Godin | President & COO Post Q2 2019 TSX - HLS
Slide 2: Forward-looking statements
Forward-looking statements Certain statements in this presentation are “forward-looking statements”. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often, but not alwa
Slide 3: HLS's methodical strategy
HLS’s methodical strategy Staged approach KEY STRENGTHS Operational pharma know-how 1. FOUNDATIONAL cash flow Business development expertise 3. LATE-STAGE CLINICAL Efficient corporate platform explosive growth Strong balance sheet 2. TRANSFORMATIVE organic growth Canadian-based, North American-focus
Slide 4: Rapid scale since inception
Rapid scale since inception REVENUE ADJUSTED CASH FROM 1 (US$ millions) EBIDTA OPERATIONS 6 2 (US$ millions) (US$ millions) $61.1 $41.1 $32.7 TRANSACTIONS THERAPEUTIC AREAS For the year ended December 31, 2018 15,000 MENTAL HEALTH PATIENTS 51 EMPLOYEES LISTED ON TSX DE-LEVERED & REFINANCED DEBT C$50
Slide 5: Our portfolio
Our portfolio FOUNDATIONAL PRODUCTS Clozaril Schizophrenia U.S./Canada Acquired 2015 marketed CSAN Pronto Safety diagnostic to Clozaril therapy U.S./Canada In-licensed 2019 filed with Health Canada Mar ‘19 Absorica Acne U.S. Acquired 2016 marketed by third party TRANSFORMATIVE PRODUCTS Vascepa CV ri
Slide 6: Clozaril: Well established antipsychotic in North America
Clozaril: Well established antipsychotic in North America WHO essential medicine Schizophrenia Clozaril 1% of population 1/3 patients 15,000 refractory to first line treatment active patients LIFE CHANGING US$29.7 Million Clozaril can be life changing, revs in Canada in 2018 often the only and last
Slide 7: CSAN: Our patient portal and registry is an economic moat
CSAN: Our patient portal and registry is an economic moat for Clozaril in Canada Created resilient demand for product 200,000 55% 25 dedicated resources blood market tests/year share Sales reps Nurses Physician consultants 50,000 Every week calls to Follow-up with 24/7 availability customers/ 1,300
Slide 8: PERSERIS: Exclusive Canadian rights
PERSERIS: Exclusive Canadian rights FDA-approved; launched in U.S. market in Q1 2019 First once-monthly risperidone long-acting injectable (LAI) Strong label and differentiated core claims Compelling positioning and well-defined marketing plan 2019 Q1 Q2 Q3 Q4 2020 Q1 Q2 Q3 Q4 2021 Q1 HC RESPONSE FI
Slide 9: Vascepa (Icosapent Ethyl): Transformational anchor to launch our second therapeutic franchise
Vascepa (Icosapent Ethyl): On path to become a first-in-class Rx cardiovascular (CV) product In-licensed from Amarin Corp (NASDAQ: AMRN) Approved for sale in the U.S. (indicated for very high triglycerides; FDA ruling on CV label expansion expected toward end of 2019) Prospective indication for CANA
Slide 10: Vascepa: REDUCE-IT trial delivered Blockbuster results
Vascepa: REDUCE-IT trial delivered Blockbuster results Trial design Trial results Primary endpoint Significant reductions on secondary endpoints 8,200 PATIENTS statin placebo CV1 Heart Stroke + Death Attack statin Vascepa 25% 20 % 31 % 28 % + Reduction in Major Adverse CV1 Events Number Needed to Tr
Slide 11: Vascepa: 30% Reduction in First and Subsequent Events
Vascepa: 30% Reduction in First and Subsequent Events Primary Composite Endpoint 0.6 RR, 0.70 P<0.0001 Placebo + Statin (Total Cardiac Events) 0.5 Vascepa + Statin (Total Cardiac Events) “This may be the biggest development Cumulative Events per Patient 0.4 30% in cardiovascular prevention 159 fewer
Slide 12: Vascepa: Characteristics of a category leader
Vascepa: Characteristics of a category leader The Unmet The Problem Need Solution 7-8M Canadians have elevated Triglyceride Vascepa levels #1 Killer LDL- effectively and Residual globally is CV disease related risk risk safely lowers CV events by 40M Rx/year written for 30% statins Estimated revenue
Slide 13: Vascepa – Strong differentiator and market position
Vascepa – Strong differentiator and market position HLS has exclusive Canadian rights to Vascepa $5M paid upfront $60M in milestone payments largely tied to sales Double-digit tiered-royalty 2019 Q1 Q2 Q3 Q4 2020 Q1 Q2 Q3 Q4 2021 Q1 Filed with Health Canada HC RESPONSE LAUNCH Vascepa granted Priorit
Slide 14: Trinomia: Expanding our cardiovascular franchise
Trinomia: Expanding our cardiovascular franchise In-licensed from Ferrer Internacional, S.A. (Spain private) INDICATION DIFFERENTIATION SECONDARY TRI-COMBO CAPSULE PREVENTION OF “Polypill” CARDIOVASCULAR COMPLIANCE/ADHERENCE IMPROVEMENT EVENTS Patients at risk following an initial CV event are poly
Slide 15: Trinomia: Exclusive Canadian rights
Trinomia: Exclusive Canadian rights 46,000 30+ Rx/month 36 months countries approved in post launch (Spain) 2019 Q1 Q2 Q3 Q4 2020 Q1 Q2 Q3 Q4 2021 Q1 HC RESPONSE FILE & LAUNCH Leverages Vascepa sales and marketing infrastructure TSX - HLS HLS THERAPEUTICS INC. 15
Slide 16: Positive tailwinds
Market Balance trends sheet strength Positive tailwinds Rich Robust proprietary Organic pipeline deal flow growth TSX - HLS HLS THERAPEUTICS INC. 16
Slide 17: Significant head room to grow portfolio
Strong organic growth built-in with rich pipeline of proprietary deal flow THERAPEUTIC FOCUS OPPORTUNISTIC OPERATING LEVERAGE = ORGANIC GROWTH Significant head room to grow portfolio TSX - HLS HLS THERAPEUTICS INC. 17
Slide 18: Veteran specialty pharma leadership team
Veteran specialty pharma leadership team MANAGEMENT BOARD William Wells | Executive Chairman William Wells | Executive Chairman Former CEO and Director of Biovail Current or former Board roles with: Biovail/Valeant, Medgenesis, ACADIA Pharmaceuticals, EnerCare and Evizone Greg Gubitz | Chief Executi
Slide 19: A business of scale based on two foundational products
A business of scale based on two foundational products With potentially transformative products on deck REVENUE* ADJUSTED EBIDTA*1 CASH FROM OPERATIONS ($ millions) ($ millions) ($ millions) 75.1 55.9 32.7 Clozaril 61.4 27.2 27.5 Absorica* 54.0 11.6 41.1 21.7 38.5 8 20.0 47.5 49.8 46 12.5 -6.3 20 20
Slide 20: YTD 2019: Steady Financial Results
YTD 2019: Steady Financial Results With potentially transformative products on deck REVENUE ADJUSTED EBIDTA1 CASH FROM OPERATIONS ($ millions) ($ millions) ($ millions) 29.5 26.8 5.3 4.7 19.6 17.2 15.2 16.4 16.3 13.6 3.8 2.2 11.0 24.1 22.1 Clozaril 9.0 8.1 Absorica* 12.5 11.4 1.7 Q2 18 Q2 19 YTD 18
Slide 21: Strong balance sheet
Strong balance sheet SUMMARY BALANCE SHEET & CAPITALIZATION (in USD ‘000,000’s, unless otherwise noted) At Dec 31, 2018 At Jun 30, 2019 $100M debt expansion Cash and Cash Equivalents 10.9 52.3 facility available Senior Secured Term Loan 98.7 96.3 Net Debt (Term Loan less Cash) 87.8 44.0 At Dec 31, 2
Slide 22: Strong cash flow and balance sheet
Strong cash flow and balance sheet Strength Dividend: $0.20 per share per year Debt Refi: De-levered & ~$10M annual savings Clear value creating strategy Cash flow/Growth/Explosive growth Execution 2 cash flowing assets 2 filed with Health Canada 2 pre-registration assets Vascepa: Blockbuster trial