Forward Looking Statements

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2 Forward Looking Statements This presentation includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of These statements include but are not limited to our plans, objectives, expectations and intentions and other statements that contain words such as expects, contemplates, anticipates, plans, intends, believes and variations of such words or similar expressions that predict or indicate future events or trends, or that do not relate to historical matters. These statements are based on our current beliefs or expectations and are inherently subject to significant uncertainties and changes in circumstances, many of which are beyond our control. There can be no assurance that our beliefs or expectations will be achieved. Actual results may differ materially from our beliefs or expectations due to economic, business, competitive, market, regulatory, and other factors. A full discussion of our operations and financial conditions, including risk factors that may affect our business and future prospects, is contained in our most recent regulatory filings. For a complete account of our official corporate documents, you are encouraged to review documents filed with the securities regulators in the U.S. and Canada. 2

3 Investment Highlights 1st point-of-care diagnostic platform for tears Technology objectively diagnoses Dry Eye Disease (DED) Safe, easy-to-use, very accurate Large IP portfolio FDA 510(k) approved and CLIA waived, opening the door to all U.S. optometry and ophthalmology offices Recurring revenue model Medicare code 83861: reimbursement $45.42/patient ($22.71/ eye) 3

4 TearLab Tear Collection 4

5 Breakthrough Technology Accuracy < 1.5% coefficient of variation ( CV 50 nanoliters Glucose 5.0% 5 microliters Cholesterol > 4.0% 20 microliters 20 µl 5 µl 50 nl Safe, simple collection No reports of corneal or conjunctival trauma in 468 eyes TearLab FDA 510(k) submission 2009 Medical Design Excellence Award ( MDEA ) for in vitro diagnostics Sources: Kimberly MM et. al., Clinica Chimica Acta 364 (2006); Volles DF et. al. Pharmacotherapy 18:1 (1998) 5

6 Intellectual Property Large IP portfolio on tear collection 9 patents issued: 7,017,394; 7,051,569; 7,111,502; 7,129,717; 7,204,122; 7,574,902; 7,810,380; 7,905,134; 7,987,702; 8,020,433 Several pending (around design, manufacturing and other tests) Electrochemical platform that has broken the nanoliter volume barrier Enables standard testing methodologies on this platform for many different diagnostic tests for a variety of markers Patents pending on other analytes (proteins, genes) and methods to measure Core claims around lab-on-a-chip in the U.S. and selected key countries 6

7 First Test: Dry Eye Disease Tears are a sophisticated 3-layer film, and are essential to the quality of our vision The front layer, produced by the meibomian glands, is oil and it keeps tears from evaporating The middle (aqueous) layer, produced by the lacrimal glands, gives it the thickness and uniformity to ensure a clear image The back layer is a polish that fills in any irregularities in the corneal surface 7

8 4 Key Tenants of DED 1. DED is a multifactorial disease causing an unstable tear film and fluctuating vision 2. DED may be associated with: stinging, burning or scratchy sensation, redness, fatigue and/or irritation Severity of symptoms depends on the sensitivity of the corneal nerves and can be exacerbated by anterior segment surgery (e.g. cataract, refractive or glaucoma surgery) and/or contact lens use Patients with desensitized corneas may not experience these symptoms but still experience significant fluctuation in vision 3. Symptoms often confound the DED diagnosis, as similar symptoms are associated with a variety of conditions 4. High osmolarity is the hallmark physiologic marker in DED; in fact, it is included in the definition of DED in the DEWS* report *Report of the Diagnosis and Classification Subcommittee of the Dry Eye Workshop (DEWS). The Ocular Surface 5(2): 75-92,

9 Large (and Growing) Patient Population Survey by Harris Interactive on behalf of Allergan, Inc., found that nearly half of all U.S. adults (48%) experience one or more dry eye symptom(s) regularly TearLab Osmolarity Prevalence Study (8,845 patients) found the overall incidence of hyperosmolarity amongst the study population was 48% Dry Eye Syndrome To Become Most Common Eye Disease in Baby Boomers Dry eye expert Dr. David Kisling reports that Dry Eye Syndrome will be the most prevalent eye disorder the Baby Boomer generation faces in the future. Shifting demographics in an aging population will result in a tidal wave of dry eye problems by 2030.* * PRWeb (June 2, 2011) 9

10 TearLab: Objective & Sensitive Enough To Be Used to Both Diagnose & Manage DED Testing both eyes: the higher of the two osmolarity findings helps determine Severity of DED based on a linear Osmolarity Severity Scale Inter-eye difference (> 8 mosml/l) confirms instability of the tear film and is an important factor helping confirm a DED diagnosis Normal patients almost never have more than 4-5 mosml/l difference between eyes 10

11 Current Diagnosis Paradigm Schirmer Test The main test for dry eye is the Schirmer test Requires repeated examinations at up to five minutes per examination Unfortunately, this test misses detecting many patients with dry eyes Other tests should also be done before ruling out a diagnosis of dry eyes ( Clinical Test Positive Predictive Value Osmolarity 1 87% Schirmers 2 31% Tear Film Breakup Time 2 25% Staining 2 31% Meniscus Height 2 33% 1. Tomlinson A., McCann L., Pearce E.I. Comparison of OcuSense and Clifton Nanolitre Osmometers. IOVS ARVO Abstract, Report of the Diagnosis and Classification Subcommittee of the Dry Eye Workshop (DEWS). The Ocular Surface 5(2): 75-92,

12 TearLab in the Practice General Practice Laser Vision Correction Cataract Surgery and Premium IOLs Glaucoma Management Contact Lens Fitting and Management Properly diagnose patients with ocular irritations and measure the effectiveness of DED therapies Identify patients with DED and guide pre- and postsurgical treatment to significantly improve refractive outcomes and reduce complaints of DED symptoms Improve refractive outcomes and patient satisfaction while appropriately managing expectations following surgery Improve compliance and manage the impact of chronic preservatives used in glaucoma patients which is known to cause DED Approx. 50% of contact lens users develop CLYDE (Contact lens Induced Dry Eye Disease) in 5 years 12

13 TearLab Osmolarity Market Size and Economics Card Revenue Economics based only on U.S. Doctor Utilization There are approximately 20,000 ophthalmologists + 30,000 optometrists in the U.S. Market Potential based on U.S. (only) Doctor Access Assuming 50,000 Doctors, seeing an average of 6 dry eye patients per day testing both eyes, assuming a $10 card cost and working 250 days per year. $1.5 Billion market based only on routine examinations Additional opportunities for TearLab in Refractive surgery pre- and post-operative testing Cataract Implantable lens fittings Clinical trials Rest of the World 13

14 Sales Group 2014 Compensation Position # Base Salary Range Target Variable Comp. Total Comp at 100% Regional General Manager (GM) 4 $105, ,000 $60,000 $165, ,000 Assistant Sales Manager (ASM) 5 $70,000-95,000 $45,000 $115, ,000 Territory Manager (TM) 35 $55,000-75,000 $60,000 $115, ,000 Independent Sales rep and Sub $1,000/device+ 7% reps (ISR)* 6 $0 Rev. - Implementation Specialists (IS) 12 $55,000 $30,000 $85,000 Professional Relations Coordinator (PRC) 4 $43,000 $5,000 $48,000 Regional Reimbursement Specialist 4 $50,000-70,000 10% $60,000-80,000 * Under review TOTAL 70 14

15 U.S. Sales and Marketing Strategy 2014 Marketing Plan: Trade shows Focus on Key Opinion Leaders and medical marketing programs Peer-reviewed clinical trial studies utilizing TearLab technology Introducing practice management programs and accredited DED practice program 2014 Targeting Strategy: Primary - All Grow Ophthalmologists - Refractive & Cataract Surgeons that perform premium procedures - Optometrists that are in a co-management environment Secondary - All Cataract Surgeons who don t perform premium procedures - All General Ophthalmologists who don t do surgery - All Optometrists who don t co-manage Non-Targets - Retina Surgeons - Glaucoma Specialists - Corporate Chains 15

16 Program Options 1. Purchase Purchase the System for $9,500 with no minimum card commitment 2. USE Agreements Free use of the system with a minimum 3 year commitment to purchase cards 1,500 cards per year at $12.50 per card 2,400 cards per year at $10 per card 3. MASTERS Multi Unit Program Designed to accommodate large practices (more than 5 units) that want to integrate TearLab into each of their examination lanes There are no minimum card guarantees, but detailed analysis of patient volumes and clinic protocols provide specific volume expectations that are in line with our revenue expectations 16

17 Installed Base 03/31/14 06/30/2014 Active Purchased Devices Active Devices Under Use Contracts Active Devices Under Masters Contracts 1,462 (1) 1,718 (2) Total Active Devices 2,454 2,746 Devices Not Yet Activated Total Devices 2,678 2,838 Devices Sold Outside the U.S (1) 176 Masters Accounts (2) 206 Masters Accounts 17

18 Revenue / Device / Account 18

19 Revenue Growth Post CLIA-Waiver 19% Sequential Growth Q Over Q

20 Management Team Elias Vamvakas, CEO and Chairman Seph Jensen, President and COO Benjamin Sullivan, Ph.D., CSO Michael Lemp, M.D., F.A.C.S., CMO 20+ years of public company leadership focused in eye care, CEO/founder TLCVision 17 years with Alcon leading marketing and sales both in US and Internationally Harvard Medical School, University of California San Diego Clinical Professor of Ophthalmology, Georgetown & George Washington University David Eldridge, OD, F.A.A.O., V.P. Clinical and Professional Development Michael Berg, V.P. Clinical & Regulatory Steve Zmina, V.P. Manufacturing Bob Walder, P.A.-C., V.P. Operations Tracy Puckett, V.P. Marketing Bill Dumencu, CFO Duane Morrison, V.P. Sales Delanu Ligu MSc., V.P. Information Technology Paul Smith, V.P. International Markets Venkiteshwar Manoj, PhD., V.P. Medical Affairs Adjunct professor, NSUCO, EVP TLC Vision, Occulogix 25+ years experience in CLIA waived IVD, Hemocue 25+ years experience, developed over 100 products, Thermoscan, Tandy 30+ years experience in healthcare, manufacturing & operations, Abbott Labs 25+ years experience, McCann-Erickson, Alimera Sciences, Novartis Ophthalmics 25+ years experience in Eye care industry and manufacturing, TLCVision, Occulogix 25+ years of sales and management experience, TLCVision, The Technology Source 16+ Years of HealthCare and IT, TLC Vision, Occulogix 12 years marketing, sales and operations leadership experience with Alcon Authored over 50 scientific abstracts, research papers and book chapters, Alcon, B&L 20

21 Summary 1st point-of-care diagnostic platform for tears Initial test objectively diagnoses Dry Eye Disease Safe, easy-to-use platform requiring only 50 nl of tear film Recurring revenue model Large IP portfolio Medicare reimbursement $45.42/patient ($22.71/eye) 21