The Oncology Institute, Inc. · NASDAQ:TOI
The Oncology Institute — DFP Healthcare Acquisitions — SPAC Merger (October 2021)
42 slides from The Oncology Institute's SPAC merger presentation, Oct 12, 2021
Slide 1: The Leader in Value Based Oncology Care - October 2021 Analyst Day Presentation
The Leader in Value Based Oncology Care October 2021 Analyst Day Presentation
Slide 2: Disclaimer and Forward Looking Statements
Disclaimer and Forward Looking Statements 2 Disclaimer: This presentation is provided for informational purposes only and has been prepared to assist interested parties in making their own evaluation with respect to a potential business combination (the “Potential Transaction”) involving TOI Parent
Slide 3: Disclaimer and Forward Looking Statements (continued)
Disclaimer and Forward Looking Statements (continued) 3 No Offer or Solicitation: This presentation shall not constitute a solicitation of a proxy, consent or authorization with respect to any securities or in respect of the proposed transaction. This presentation shall also not constitute an offer
Slide 4: Strong Leadership Team with Extensive Value Based Care Experience
4 Strong Leadership Team with Extensive Value Based Care Experience Brad Hively Chief Executive Officer Dr. Daniel Virnich Chief Operating Officer Richard Barasch Executive Chairman ▪ 20+ years of executive leadership and healthcare investing experience ▪ Previously President of Health Essentials an
Slide 5: Business Summary
Business Summary
Slide 6: Rising Cost of Oncology Care is a Massive Problem in the U.S.
Rising Cost of Oncology Care is a Massive Problem in the U.S. Sources: Cancer Epidemiology, Biomarkers & Prevention – American Association For Cancer Research, July 2020; National Center fo r Health Statistics; IQVIA Institute; National Health Expenditure Data – CMS; Spending on Health: Latest Trend
Slide 7: Our Disruptive Value Based Oncology Care
Our Disruptive Value Based Oncology Care Today’s Traditional Fee - for - Service Oncology Care x Incentivized by quality x Incentivized to use high - value therapies x Physician compensation model aligned to quality and patient satisfaction x Practice tailored to address individualized patient needs
Slide 8: What We Do: Value-Based and Fee-For-Service Model
What We Do 8 Value - Based and Fee - For - Service Model • We provide oncology care to patients through capitation (value - based) contracts as well as traditional Fee - For - Service (FFS) care • Capitation contracts pay a fixed per member per month (PMPM) fee based on the number of enrollees by th
Slide 9: We are the Leading Value Based Oncology Care Platform
50+ Locations in Four States ~200K Patient Visits in 2020 80+ Oncologists and Mid - levels 100+ Clinical Trials Giving Patients Cutting Edge Treatment Access ~1.5M Lives Served Under Capitation ~46K Unique Patient Encounters in 2020 >50% Revenue Generated from Value Based Agreements >25% Reduction i
Slide 10: We Are Shifting the Market to Value Based Oncology Care
We Are Shifting the Market to Value Based Oncology Care Primary Care Leading the Charge in Transition to Value Based Care Oncology Spend is a Major Pain Point for Value Based Primary Care TOI is the Market Leader in Value Based Oncology Care Sources: American Society of Clinical Oncology; Cancer Epi
Slide 11: Our Value Based Oncology Care Model is Disrupting the Market
Our Value Based Oncology Care Model is Disrupting the Market 11 TOI is the Leading Value Based Oncology Care Practice that is Aligning both Physicians and Payors with Incentives to Simultaneously Enhance Quality and Lower Costs Benefit Managers Physician Practices Aligned with physicians, practice -
Slide 12: How We Create Value for Our Payor Partners
12 How We Create Value for Our Payor Partners Illustrative Cost Savings and Gross Profit 1 2 3 Payor Cost for Medical Oncology without TOI Payor Cost for Medical Oncology with TOI TOI Cost to Treat Patients ▪ Payors are challenged with high and escalating medical oncology costs ▪ Driven by misaligne
Slide 13: Massive Whitespace Opportunity in Oncology Care Market
Our Operating Model is Highly Scalable and Replicable Current Markets High Priority / Near Term Expansion Markets Secondary Target Markets 9 Current Markets in 4 States ~25mm Commercial and Medicare Advantage Lives ~$6bn Opportunity High Priority Expansion Markets ~23mm Commercial and Medicare Advan
Slide 14: Proven Portability with Rapidly Expanding Footprint
5 Clinics & 9 Hospital Affiliations 3 Clinics & 12 Hospital Affiliations Nevada Florida 5 Clinics & 6 Hospital Affiliations 14 Proven Portability with Rapidly Expanding Footprint California 46 Clinics & 75+ Hospital Affiliations Arizona (Lancaster) (Rancho Mirage)
Slide 15: Strong Leadership Team with Extensive Value Based Care Experience
Dr. Yale Podnos Chief Medical Officer Brad Hively Chief Executive Officer Dr. Daniel Virnich Chief Operating Officer Scott Dalgleish Chief Financial Officer 15 Strong Leadership Team with Extensive Value Based Care Experience Diona Simoneit Controller Dr. Matt Miller Chief Administrative Officer Ire
Slide 16: Clinical Overview
Clinical Overview
Slide 17: We Use Multiple Levers to Reduce Cost of Care
Sources: Lay Healthcare Worker Led Cancer Screening Interventions and the Effect on Patient - Reported Satisfaction, Health Status , Healthcare Use, and Total Costs; Journal Of Oncology Practice; August 16, 2019. Note: (1) Compared to average Per Member Per Month costs in our primary geographies. Wh
Slide 18: Our Care Model is Hard to Replicate
Our Care Model is Hard to Replicate 18 TOI has Developed Many Highly Specific and Difficult to Replicate Capabilities that Collectively Comprise our Competitive Moat Clinical Culture Coding Accuracy Care Management Integration of Palliative Care and Hospice Physician Recruiting Clinical Trials Tech
Slide 19: Our Results are Peer-Reviewed and Published
Our Results are Peer - Reviewed and Published > 25% Lower median total healthcare costs from diagnosis to death 75% Fewer Emergency Department visits in the last month of life 40% Fewer acute care facility deaths 14% Improvement in Patient Satisfaction 30% Lower inpatient admissions Highly Effective
Slide 20: Our Patient-Centric Focus Drives High Levels of Satisfaction
Note: (1) As of April 11, 2021. Our Patient - Centric Focus Drives High Levels of Satisfaction 4.5 4.5 4.5 4.5 4.3 4.6 4.5 4.6 4.4 4.5 Jul-20 Aug-20 Sep-20 Oct-20 Nov-20 Dec-20 Jan-21 Feb-21 Mar-21 Apr-21 Satisfaction Rating (0 – 5 Scale) ~3,000 88% patients surveyed of Oncologists Rated 4.0 or Abov
Slide 21: Custom-Built Care Pathways Deliver High Quality, Evidence-Based Care
21 Custom - Built Care Pathways Deliver High Quality, Evidence - Based Care at the Optimal Value ▪ Physician selects options in coordination with Medical Director team (internal peer reviewers), based on patient - specific factors ▪ Physician chooses from remaining options with support and oversight
Slide 22: Our Technology Platform is Purpose Built for Oncology Care
22 Our Technology Platform is Purpose Built for Oncology Care Providers Payors 1. Collect Work with health plans and primary care doctors on front - end collection of extensive patient data sets 3. Apply Use results from our data analysis to dictate appropriate care pathways 2. Analyze Leverage prop
Slide 23: High Value Cancer Care Program (HVCC)
High Value Cancer Care Program (HVCC) Designed to Reduce Cost While Improving Patient Outcomes 23 Notes: (1) Edmonton Symptom Assessment (ESAS); (2) Patient Health Questionnaire (PHQ - 9); (3) Compared with average Per Member Pe r Month costs in our primary geographies. Rapid Response Symptom Contro
Slide 24: Growth
Growth
Slide 25: Multiple Levers to Sustain Long Term Growth Trajectory
25 Multiple Levers to Sustain Long Term Growth Trajectory Service Expansion Expand Scope and Diversify Service Offering x Build comprehensive portfolio of ancillary services x Pharmacy x Clinical trials x MSO services x Data monetization Existing Markets Continue Driving Live Growth and Partnership
Slide 26: New Market Entry Playbook with Track Record of Success
26 New Market Entry Playbook with Track Record of Success Designed to Scale Efficiently 1 3 2 Market Identification Market Prioritization Market Entry x Payor Needs x Addressable Market x Demographics Characteristics and Trends x High Cost of Care x Existing Payor Partnership x Cost Containment Oppo
Slide 27: Large Pipeline Drives Organic Growth in Existing and New Markets
Note: Pipeline as of April 15, 2021. 27 Florida ~500K 14% Other Markets ~1M 29% Late Stage ~1.5M 43% ~3.5M Total Lives in Pipeline ~1.5M Late Stage Lives ~120 New Account Leads in Existing and Priority Markets with Large Portion of High Certainty Opportunities to Support Late Stage Growth Targets La
Slide 28: Actionable Oncologist Pipeline in Place to Support Contract Growth
Sources: Management Estimates, American Society of Clinical Oncology, Community Oncology Alliance. 28 Actionable Oncologist Pipeline in Place to Support Contract Growth CA NV TX FL TN NY AZ Priority Target Markets Huge and Fragmented Independent Provider Base • Reimbursement, regulatory and payor pr
Slide 29: Utilization Management
Utilization Management
Slide 30: Overview of Utilization Management Program
Quality Improvements Adherence to our Value - Based Mission 30 Overview of Utilization Management Program Excellence in Patient Care – Treatment Efficacy and Patient Safety
Slide 31: TOI Treatment Cost Savings
TOI Treatment Cost Savings 31 Treatment Cost Savings Categories 1. Biosimilar / Generic Substitutions 2. Optimizing Supportive Care Medications 3. Reducing Drug Wastage 4. Utilization of Value - Based Chemotherapy 5. Evidence - Based Reductions in Treatment Duration 6. Enrollment in Clinical Trials
Slide 32: Financial Overview
Financial Overview
Slide 33: Summary Financials
33 Summary Financials (1) Represents lives at year end. We Target Steady State Gross Margin of ~30% and Adjusted EBITDA Margin of ~15%
Slide 34: Summary of Revenue and Costs Construct
Summary of Revenue and Costs Construct 34 Payors / VBC Lives Clinic + Provider Capacity Other / Clinical Trials Orals FFS Chemo VBC Revenue Grow via Recruitment and Acqui - Hires Drugs Other Clinical Staff Patient Services Gross Margin Revenue COGS
Slide 35: Strong Unit Economics Drives Increasing Profitability
10% 15% 20% 25% 30% 35% 40% 20% 30% 40% 50% 60% 70% 80% 90% Pod Gross Margin Pod % Value - Based Visits 35 Note: (1) Advanced Practice Providers (APPs) include Physician Assistants and Nurse Practitioners; (2) Each pod is an operati ona l unit consisting of 2 - 5 clinics, grouped together based on g
Slide 36: Business Update
• Recently signed several significant payor contracts in California • Executing de novo growth in St Petersburg (FL), Victorville (CA) and entered the San Diego market • Strong and growing pipeline of acqui - hires, de novo locations and value - based contracts • Anticipate expansion into additional
Slide 37: Appendix
Appendix
Slide 38: Transaction Summary and Valuation Overview
Note: (1) Based on capitated lives managed through employed oncologists; (2) 2016 revenue based on cash basis unaudited finan cia ls; (3) Subject to redemptions. Transaction Summary Valuation Overview 38 Transaction Overview • The Oncology Institute of Hope & Innovation (TOI) is the largest (1) scal
Slide 39: Net Income to Adjusted EBITDA Reconciliation
39 Net Income to Adjusted EBITDA Reconciliation (1) (1) Note: (1) Comprised of legal and Board fees; salary and wage expenses; asset impairments; stock compensation expense; non - cash r ent; other expenses and income; (2) Adjusted EBITDA margin defined as Adjusted EBITDA divided by Revenue. (1) (2)
Slide 40: Summary Risk Factors
Summary Risk Factors
Slide 41: Certain Risks Related to the Oncology Institute
Certain Risks Related to the Oncology Institute All references to “TOI,” “we,” “us,” “our” or the “Company” refer to the business of TOI Parent, Inc. and its affiliates. The ri sks presented below are certain of the general risks related to the business of the Company, and such list is not exhaustiv
Slide 42: Certain Risks Related to the Oncology Institute (Cont'd)
Certain Risks Related to the Oncology Institute (Cont'd) Risks Related to TOI’s Business (Cont’d) • We conduct some clinical trials in contract with the ICRI. If we fail to perform our clinical trial services in accordance wi th contractual requirements, government regulations and ethical considerat
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