Neovasc Inc. October 2010

Transcription

1 Neovasc Inc. October 2010 Alexei Marko, CEO Chris Clark, CFO

2 Forward-Looking Statements Statements contained herein that are not based on historical or current fact, including without limitation statements containing the words anticipates, believes, may, continues, estimates, expects, and will and words of similar import, constitute forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, events or developments to be materially different from any future results, events or developments expressed or implied by such forward-looking statements. Such factors include, among others, the following: general economic and business conditions, both nationally and in the regions in which the Company operates; technology changes; competition; changes in business strategy or development plans; the ability to attract and retain qualified personnel; existing governmental regulations and changes in, or the failure to comply with, governmental regulations; liability and other claims asserted against the Company; and other factors referenced in the Company s filings with Canadian securities regulators. Given these uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. The Company does not assume the obligation to update any forward-looking statements.

3 Neovasc at-a-glance Medical device company focused on innovative products to treat heart disease and related conditions Two key product lines with large growth potential : Neovasc Reducer for treatment of refractory angina Implantable biological tissue and services for minimally invasive heart valves and other applications Initial products approved in US/EU with growing revenues ($3M in 2009, forecast $4M in 2010) Expect positive cash flow in 2010 from biological tissue business TSX-Venture Exchange listed (TSX: NVC)

4 Neovasc Key Products Neovasc Reducer Treatment for Refractory Angina Implantable Biological Tissue Components for emerging new market in Transcatheter Heart Valves and other products

5 Reducer Summary Treats Refractory Angina Inadequate blood flow to heart muscle that cannot be managed through conventional drug, catheter or surgical therapy Causes constant and severe heart pain and significant disability that negatively impacts quality of life Large affected population is growing as better treatments for CAD (i.e., stenting or bypass) reduce mortality and increase number of patients with advanced disease

6 Reducer Market Opportunity Estimated selling price $3,000 - $5,000 ~ 2 million existing no option refractory angina patients in US & Europe ($6B potential market) ~400,000 new no option patients diagnosed annually ($1.2B potential market) ~ 1 million patients/year in US & Europe undergo repeated surgeries and catheterizations to treat recurrent angina ($3B potential market )

7 Reducer The Problem Oxygenated blood feeds heart muscle through coronary arteries inflow outflow Chronically diseased arteries restrict blood flow to capillaries that feed heart muscle Severe Angina Pain De-oxygenated blood from heart muscle collected in coronary sinus

8 Reducer How It Works Reducer restricts outflow of blood from coronary veins, forcing oxygenated blood deeper into the heart muscle where it reaches oxygen-starved ischemic areas Improved penetration of blood to feed heart muscle Reduced Angina Pain Reducer

9 Reducer Procedure Treatment by narrowing coronary sinus based on a surgical procedure performed in 1960 s (Beck Procedure) Beck Procedure reported excellent results but is no longer performed due to invasiveness of the surgery Neovasc Reducer achieves same narrowing, but using modern catheterbased techniques (non-surgical) Reducer procedure time ~20 minutes; patient discharged within 24 hours Safely provides treatment for an otherwise untreatable patient CORONARY SINUS

10 Reducer Clinical Results Compelling clinical data from first human trial (15 patients, 3 centers) Six-month data published in JACC, May 2007 demonstrated safety and significant improvement of angina symptoms Three-year follow-up data confirms excellent long-term safety and durability of treatment (data presented at ACC, March, 2010) Average CCS Class Average Echo-Dobutamine Results Average Thalium SPECT Severity Baseline 6-mos 3-yrs Baseline 6-mos 3-yrs Baseline 6-mos 3-yrs

11 Reducer COSIRA Trial for CE Mark Application COSIRA (Coronary Sinus Reducer for Treatment of Refractory Angina) Double-blind, randomized, sham-controlled, multicenter, prospective trial 124 patients Randomized 1:1 to blinded treatment and sham control arms Primary endpoint: 6-months Data intended to support CE-mark application and EU launch 4 sites in Europe (Belgium, Netherlands), 2 sites in Canada Enrollment proceeding well estimated completion mid-2011 COSIRA case broadcast live to TCT-2010 conference in Washington DC

12 Advisors Include Key Opinion Leaders Leaders in interventional cardiology and refractory angina are working on the Reducer program enthusiasm evident at TCT Live Case Dr. Martin Leon (Columbia University Medical Center, NYC) Dr. Tim Henry (Minneapolis Heart Institute) Dr. Elazer Edelman (Harvard MIT, Cambridge) Dr. Chris White (Oschner Medical Center, New Orleans) Dr. Shmuel Banai (Tel Aviv Souraski Medical Center) Dr. Stefan Verheye (Antwerp Cardiovascular Institute) Dr. Johannes Waltenberger (University Hospital of Maastricht) Dr. Marc Jolicoeur (Montreal Heart Institute) Dr. Jean-Francois Tanguay (Montreal Heart Institute

13 Reducer Commercialization Timeline Commercial product completed Europe: COSIRA to provide data for CE-mark and European launch (early 2012) US: FDA trial and approval process (PMA) will be initiated following European CE-mark approval (commence mid 2012)

14 Implantable Biological Tissue Products Proprietary Neovasc process creates implantable, biocompatible tissue that retains strength and physical characteristics of natural tissue Developed specifically for surgical heart valve applications Adapted for general surgical use as a patch or reinforcement material FDA-cleared and CE-marked EDQM certified 20+ year positive implant history

15 Rapid Growth in Heart Valve Applications Neovasc is the leading supplier of biological leaflet material to companies developing transcatheter heart valves Acquisitions of Ventor, Corevalve and Evalve in 2009 spurred rapid growth of sector PARTNER trial results (Sept 2010) demonstrate 20% lower mortality for patients treated with transcatheter aortic valve compared to standard therapy: 31% mortality at 1-year with Sapien transcatheter valve vs. 51% with standard therapy "Based on the reduction in mortality during the first year of the [PARTNER] study, balloon-expandable TAVI [transcatheter aortic valve implantation] should be the new standard of care in patients who are not suitable candidates for surgery," Martin B. Leon, M.D.

16 Rapid Growth in Heart Valve Applications Transcatheter aortic heart valve market is currently ~$200 million and is projected to exceed $2 billion by 2014 Transcatheter mitral valve replacement market is projected to grow from nil to $1billion over next 5 years As a leading supplier of heart valve leaflets & services for transcatheter valves, Neovasc expects continued strong growth in revenues as our customers next-generation heart valves reach the market

17 Other Applications Artificial heart components Covered stent grafts Specialty vascular devices Vascular surgical patches (LeMaitre Vascular s Xenosure ) Surgical patches for non-vascular use

18 Tissue Development & Manufacturing Services specifically for biological tissue-based vascular devices Product development (design, prototyping, testing, transfer to manufacture, etc.) Tissue product manufacture (valve assembly, sterilization, etc.) State-of-the-art facility and highly experienced team with expertise in tissue valve and vascular device development, manufacture and commercialization

19 Neovasc Competitive Advantages Established valve & biological tissue device manufacturing & associated operations are already generating positive cash flow Proven biological tissue process & established high volume production Expertise in multiple aspects of vascular device & heart valve product development & manufacture to support both external and internal projects State of the art product development, prototyping & manufacturing infrastructure & capabilities Established relationships with key industry partners & suppliers Established relationships with leading MD s in interventional cardiology

20 2009 Strategy: Refocus Post-Acquisition Refocus and rationalize after acquisition of two start-up companies: 1. Streamline operations to reduce cost base Maximize efficiency - eliminate all unnecessary costs and overheads 2. Aggressively grow tissue business revenues Develop strategic partnerships Target customers in rapidly growing transcatheter valve market 3. Redeploy R&D to focus on key projects Complete development of commercial-generation Reducer Enhance contract services for tissue customers

21 2010 Strategy: Break-Even, Build Value Biological Tissue Product Lines Continue to expand biological tissue business with focus on high value industry customers; fast growing segments such as new transcatheter valve products Targeting >$4 million in revenue and break-even for tissue business Neovasc Reducer Initiate enrollment in COSIRA trial to support CE mark & product marketing Explore strategic opportunities for product launch New Products Initiate early development activities for new minimally invasive cardiac products

22 2009 / 2010 Financial Results Revenue $000s 600 Actual Projected Q1 F09 Q2 F09 Q3 F09 Q4 F09 Q1 F10 Q2 F10 Q3 F10 Q4 F10 Quarter

23 2009 / 2010 Financial Results Expenses excluding Stock Compensation Expense $s R&D G&A S&M Q1 F09 Q2 F09 Q3 F09 Q4 F09 Q1 F10 Q2 F10 Quarters

24 2011 Looking Forward 1. Continued growth in revenues from tissue business (target $5M) Expect steady growth over next 12 months with upside potential as customers products enter market 2. Complete COSIRA trial for Reducer and file CE-mark application to allow sale in Europe Preliminary COSIRA study data to be presented at TCT 2011 European product launch targeted for early Expand activities to develop new strategic products Initial activities already underway in high growth segments

25 Management and Board Management Alexei Marko CEO and Board Member Chris Clark CFO Brian McPherson - COO Board of Directors Paul Geyer (former CEO, Mitroflow) Steven Rubin (Frost Group, OPKO) Dr. Jane Hsiao (Frost Group, OPKO) Dr. William O Neill (Interventional Cardiologist) Douglas Janzen (CEO Cardiome Pharma) Boaz Lifschitz (Peregrine Ventures)

26 Capitalization & Trading Shares outstanding 37.7m (issued and outstanding) 44.8m (fully diluted) Public listing TSX-V NVC Key investors Frost Group (Dr. Phillip Frost) Company management Float and trading ~75% of shares held by management and insiders Financing $2.0m financing completed in April 2009 ($0.21 unit) $1.5m financing completed in February 2010 ($0.27 unit) $1.4m exercise of 4.6m warrants in April 2010 ($0.30 share)

27 Neovasc: A Promising Opportunity Cash Generating Biological tissue business is growing, has significant upside potential & forecast to be profitable in 2011 Contributions minimize funding requirements for new product development Value Generating Pivotal trial (COSIRA) underway for Neovasc Reducer product that provides treatment for large population of no-option patients Additional high potential products in pipeline with increased development activities planned Other Strong Management, Board and Medical Advisory team Only small-cap public company focused on innovative refractory angina treatment & exploding field of transcatheter valve replacement

28 Thank you