Slide 1: Safe harbor
Safe harbor This presentation contains forward-looking statements. All statements other than statements of historical facts contained in this presentation, including statements regarding the market opportunity, products, commercial partners, user experience, clinical trials, financial performance, s
Slide 2: Recent highlights
Recent highlights pregnancies 3 •20 pilot studies signed with leading pharmaceutical companies for SignateraTM (RUO) – Dr. Roy Baynes joins Natera Board of Directors –Announced successful breast cancer recurrence trial with University of Leicester & Imperial College London Not for further reproducti
Slide 3: Driving growth in core products
Driving growth in core products Processed Units Accessioned Units Not for further reproduction or use 4 41,53541,755 Q2 2017Q3 2017Q4 2017Q1 2018Q2 2018 34,442 32,758 30,705 114,672113,318 Q2 2017Q3 2017Q4 2017Q1 2018Q2 2018 97,000 89,35191,247
Slide 4: 2018 growth = x 2017 growth: Total Processed Units
2018 growth = 2 x 2017 growth Total Processed Units Total Processed Units: % growth over prior year Not for further reproduction or use 5 350,000 327,162 300,000 250,000 200,000 150,000 100,000 50,000 - 1H 201 6 1H 201 7 1H 201 8 35% 15% 1Q172Q173Q174Q171Q182Q18 17%17% 29% 11% 32% 247,066 14% 216,64
Slide 5: 2018 growth forecasted to remain strong through the rest of the year
2018 growth forecasted to remain strong through the rest of the year Not for further reproduction or use 6 25% - 35% 15%515,220Forecast FY 2016FY 2017FY 2018 447,665 Actual YTD
Slide 6: ACOG Removed Guideline which Limited NIPT
ACOG Removed Guideline which Limited NIPT 7
Slide 7: NEJM article reviewing NIPT
NEJM article reviewing NIPT 8 “…in the general obstetrical population… the false positive rates associated with cfDNA screening were less than one tenth as high as that with multiple-marker screening, and positive predictive values were significantly higher.” “In less than a decade, prenatal cfDNA t
Slide 8: Discovery of new FFBR biomarker for pregnancies
Discovery of new FFBR biomarker for pregnancies Extends leadership position in NIPT by identifying aneuploidies and adverse outcomes that other tests do not • First key application leveraging data on > 1M samples for biomarker research • Leverages patented technology for precise fetal fraction estim
Slide 9: Commercialization plan for transplant assay
Commercialization plan for transplant assay ~20,000 transplants annually • Natera scale and experience with NGS testing provides COGS advantage • History of winning as fast follower with technical superiority • • Robust user experience Access to technology via Constellation™ platform U.S. Kidney Tra
Slide 10: Levels of donor DNA significantly higher in patients suffering acute rejection
Levels of donor DNA significantly higher in patients suffering acute rejection Significance level p<0.0001 Sensitivity: 92.3% *** 2.8% Positive 1% threshold Specificity: 72.9% 0.5% 0.5% Negative Area Under Curve (AUC): 0.90 Non-AR (n=240) Acute Rejection (n=52) Boxes indicate inter-quartile range, h
Slide 11: Transplant reimbursement pathway
Transplant reimbursement pathway • Submit analytical validation Submit clinical validation Complete CLIA validation Pre-submission meeting • • • • Obtain Z-code Analytical validation accepted Clinical validation accepted Formal LCD submission • • • • Draft Local Coverage Decision release Establish c
Slide 12: Multiple avenues to stable reimbursement
Multiple avenues to stable reimbursement Not for further reproduction or use 13 Option 2: PLA code –Pricing established on clinical lab fee schedule, e.g. cross walk process –If off cycle, pricing established by MolDX –Repriced through PAMA Option 1: Miscellaneous code with z-code modifier –Pricing
Slide 13: Signatera (RUO) highly consistent across tumor types
Signatera™(RUO) highly consistent across tumor types (n=39) (n=45) (n=10) (n=14) 4 (n=9) HR 19.8 p < 0.005 HR 34.5 p < 0.001 HR 31.8 p < 0.0001 4 (n=13) 4 1RFS post treatment. Abbosh C, et al. Nature. 2017 Apr 26;545(7655):446-451; 2RFS post cystectomy. Birkenkamp-Demtroeder K, et al. AACR; 2018. Ab
Slide 14: Similar results in breast cancer post-treatment setting
Similar results in breast cancer post-treatment setting Study completed - two additional trials ongoing Therapy response Therapy response AND recurrence Early detection of recurrence Months 36 42 48 54 60 Tumor production or use 15 Adjuvant Longitudinal Plasma Samples Scan Scan Scan Subtype Patients
Slide 15: Continued uptake of Signatera (RUO)
Continued uptake of SignateraTM (RUO) • 20 signed pilot studies with oncology companies leading pharma and immuno-• Study indications include: lung, colorectal, breast, prostate, non-hodgkins lymphoma, GI tumors, multiple myeloma, pan-cancer • On track for CLIA launch early 2019 Not for further repr
Slide 16: Average selling prices
Average selling prices Total revenues / tests reported* stable as expected Pricing drivers going forward *Q1 2018 pricing excludes one-time revenue recognition of $5.5M from Qiagen partnership Not for further reproduction or use 17 $432 Q1 2018Q2 2018 $411 • Multi-year, fixed price payer contracts •
Slide 17: Blended COGS targets driving strong returns
Blended COGS targets driving strong returns Blended COGS Trajectory $388 $400 $300 Not for further reproduction or use 18 ~68% ROIC on all R&D spend since Q1 2015 $450 $350 $250 $200 $150 $100 $50 $0 Q1 2015Q4 2017Q2 2018Funded p rojects $283$270 ~ $200 $118 savings per unit X 610,000 tests / year =
Slide 18: Q2 2018 financial overview
Q2 2018 financial overview Growth in Panorama and Horizon volumes is primary driver of change vs Q2 2017 ($ in millions, except for per share data) 1. Gross margin is calculated as gross profit divided by GAAP total revenues. Gross profit is calculated as GAAP total revenues less GAAP cost of revenu
Slide 19: 2018 guidance unchanged
2018 guidance unchanged Not for further reproduction or use 20 ($ in millions) Revenue$250 - $275 Gross Margin % revenue35% - 40% SG&A$140 - $150 R&D$50 - $55 Cash Burn$40 - $60
Slide 20: 2018 guidance unchanged
2018 guidance unchanged Ln Revenue: $250 - $275 Gross Margin % revenue 35% - 40% SG&A $140 - $150 R&D $50 - $55 ‘Cash Burn $40 - $60 @natera : » AAR AREER CEI SE HERI EES BE EE ESE TSR ETE Not for further epreduction or use
Slide 21: Natera: Conceive. Deliver.
@natera Conceive. Deliver.