Patrick J. Sullivan Chief Executive Officer. January 9, 2018 Investor Presentation

Transcription

1 Patrick J. Sullivan Chief Executive Officer January 9, 2018 Investor Presentation

2 Forward Looking Statement This presentation may contain forward-looking statements concerning Insulet's expectations, anticipations, intentions, beliefs or strategies regarding the future. These forward-looking statements are based on current expectations and beliefs concerning future developments and their potential effects on Insulet. There can be no assurance that future developments affecting Insulet will be those that it has anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond its control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements, and other risks and uncertainties described in its Annual Report on Form 10-K, which was filed with the Securities and Exchange Commission on February 28, 2017 in the section entitled "Risk Factors," and in its other filings from time to time with the Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize, or should any of its assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. Insulet undertakes no obligation to publicly update or revise any forward-looking statements Insulet Corporation, Omnipod, the Omnipod logo, Dash, Omnipod DISPLAY, Horizon, Podder and Omnipod VIEW are trademarks or registered trademarks of Insulet Corporation. All rights reserved. All other trademarks are the property of their respective owners. The use of third party trademarks does not constitute an endorsement or imply a relationship or other affiliation. 2

3 Insulet Driving Dramatic Growth and Just Getting Started Guidance 1 Targets Revenue $185M $ M $1B 20%+ Revenue CAGR Gross Margin 48% ~60% ~70% Operating Profitability $(26.7)M EBIT positive in 2018 Above-market profitability GM% up 2000 bps Significant Opportunity Sizable, under-penetrated market Product Platform Highly differentiated, providing convenience, compliance and control Proven Performance Above-market returns by experienced team focused on growth, quality and cost 1. As provided Q3 17 earnings call on November 2, Does not represent reaffirmation of guidance 3

4 Diabetes - A Worldwide Epidemic Global Patients Diagnosed 1 (in Millions) Global Diabetes Expenditure 2 ($ in Billions) $376 $ Global epidemic presents significant unmet need and market opportunity Economic impact of Diabetes; Ping Zhang; IDF Diabetes Atlas 4th edition 4

5 Significant Growth Opportunity ~5% Share of U.S. type 1 diabetes (T1D) market 1-2% Share of international T1D market <20 Countries today <1% Share of type 2 diabetes (T2D) market 2 Non-insulin drugs approved with the Omnipod platform Insulet internal analysis, International Diabetes Federation. Numbers are approximate. 5

6 Omnipod Dramatically Reduces the Burden of Diabetes Care Fewer Injections 80% of the Market Opportunity (Current Target) Fewer Components 20% of the Market Opportunity vs. vs. Omnipod: 1 MDI 2 : 14+ Injections Required Per Pod (Average of 4.5/day) 1 Omnipod System Conventional Insulin Pump 1. Insulet internal data 2. MDI = Multiple Daily Injections 6

7 DASH Simplicity through Mobile Technology User Phone Caregiver Phone CGM integration with CGM/Pod ios widget Data with ios Widgets Omnipod DISPLAY App Omnipod VIEW App Simple touchscreen PDM interface Connectivity Integrated insulin and CGM views Secondary display and caregiver apps 7

8 Digital Product Pipeline Drives Increased Adoption DASH U-500 U-200 Horizon Digital/Mobile Platform 5x Insulin Capacity Addresses Type 2 2x Insulin Capacity Addresses Type 2 Automated Glucose Control CGM 8

9 Concentrated Insulins Double Addressable U.S. Market Concentrated insulins open a ~1.4 million U.S. patient market New version of the Omnipod insulin pump to deliver Lilly s Humulin U-500 insulin Effectively increases capacity of pod 5x with equivalence to 1,000-unit reservoir >200 units units 1.7 million Effective reservoir size enables access to these T2D patients who require more than 60 units New version of the Omnipod insulin pump to deliver Lilly s Humalog U-200 insulin Effectively doubles capacity of pod with equivalence to 400-unit reservoir <60 units 0.3 T2D 1 Addressable today with Omnipod 1. Insulin-requiring Type 2 Diabetes Source: Internal Insulet analysis; NIH, CDC, dq&a, BBC, JDRF Fact Sheet, DDC Diabetes Report Card 2012, T1D Exchange. 9

10 Omnipod Horizon Automated Glucose Control On-body component Communication device Differentiation through simplicity Longest time in range Greatest freedom Broadest age range - down to age two Better outcomes and less burden for users TODAY + 10

11 Omnipod - Significant Value for Drug Delivery On-body Injector for Neulasta demonstrates the value of Omnipod technology Current trends are driving the need for self-injection devices beyond diabetes 60% 50% 40% 30% 20% 10% 0% Share of U.S. Neulasta Doses 1 YE 2015 YE 2016 Q Growth in biologics Low patient adherence Need to differentiate 1. Symphony data; Amgen public commentary 11

12 Going Direct in Europe Drives Incredible Value Beginning July 1, 2018: Commercial Focus 50% in average selling price from current pricing to EU distributor New Product Introductions Improved Financials 400 bps in gross margin Accretive immediately 1 Partnerships Geographic Expansion 1. Excluding non-recurring transition-related expenses 12

13 Manufacturing Operations - A Competitive Advantage 2017 Dramatically improved performance Operational excellence Capital investment Sourcing improvements Began building U.S. manufacturing facility and equipment 2019 First U.S. line operational in Q1 providing redundancy and expanded capacity Introduce highly-automated U.S. manufacturing Potential future expansion to support global growth 13

14 Sustainable Cost Reduction Opportunities Continue Key takeaways Continued sustainable cost savings Manufacturing Conversion Yield Components ~15% Cost Reduction Manufacturing Conversion Components Freight ~15-20% Cost Reduction Conversion savings through improvements in equipment utilization and labor efficiency Components savings by improved contractual agreements and competitive bidding (Est.) / / Savings by ocean freight and U.S. manufacturing 14

15 Insulet High Growth with Significant Opportunities Ahead $1 Billion in Revenue (20%+ CAGR) Above-market growth Strong momentum across the business Growth on continued execution, new products and market access Approaching 70% Gross Margin Clear line of sight to a target approaching 70% Expansion principally from operations improvements and U.S. automated manufacturing Additional margin improvement from going direct in Europe beginning on July 1, 2018 Other commercial opportunities across product lines Above-Market Profitability Leveraging investments to deliver above-market returns Experienced and talented team driving performance High quality and reliability with lower costs 15