Microbix Biosystems Inc. · TSX:MBX
Microbix Biosystems — Investor Presentation (May 2014)
22 slides from Microbix Biosystems's investor presentation, May 2014
Slide 1: Investor Presentation May 2014
Investor Presentation May 2014 1 TSX:MBX
Slide 2: Forward-Looking Statements
Forward-Looking Statements Certain of the statements contained in this presentation are forward-looking statements within the meaning of applicable securities laws, including, but not necessarily limited to, the “safe harbour” provisions of the Securities Act (Ontario). These statements involve know
Slide 3: Investment Highlights
Investment Highlights • Commercial virology business produces and supplies the world’s largest range of native infectious disease antigens • 2013 financial turnaround • Advancing major pipeline opportunity: LumiSort™ (livestock semen sexing) • VIRUSMAX™ (influenza vaccine yield enhancement) represen
Slide 4: Commercial Virology Business Provides Solid Foundation For Growth
Commercial Virology Business Provides Solid Foundation For Growth • Founded in 1988 • Produces and supplies infectious disease antigens, primarily for the diagnostics market • Products enjoy “gold standard” positioning • Customers include many of the top global diagnostics products companies 4 TSX:M
Slide 5: 2013 Performance Improvement Program
2013 ”Performance Improvement Program” Key Profitability Turnaround Q1 – 2014 Revenue doubled: $1.9M Operating income: $214,000 EBITDA: $495,000 Revenu Loss Profit e 5 TSX:MBX
Slide 6: Growth Strategy For 2014
Growth Strategy For 2014 • Growth Strategy: –Continue to increase share and profitability of virology business –Leverage resources to help drive pipeline • VIRUSMAX™: –Unlock value by enforcing our patents • Lumisort™: –Complete prototype to prove patent claims 6 TSX:MBX
Slide 7: Influenza Vaccine Yield Enhancement Technology
Influenza Vaccine Yield Enhancement Technology TSX:MBX
Slide 8: Global Trends Driving Need For Improvements to Influenza Vaccine Manufacturing
Global Trends Driving Need For Improvements to Influenza Vaccine Manufacturing • Limited to a small number of competitors (Merk, GSK, Sanofi Pasteur, Wyeth, Novartis) – Insufficient capacity for emerging markets, especially in the event of a pandemic – Governments reluctant to allow import-dependent
Slide 9: Our Solution: VIRUSMAX
Our Solution: VIRUSMAX™ • Proven to double output of traditional manufacturing process • VIRUSMAX™ patents issued in 21 major markets including US, Canada, Europe, India, China and Australia 9 TSX:MBX
Slide 10: Unlocking Value From VIRUSMAX
Unlocking Value From VIRUSMAX™ • Original plan was to bring technology to global market via JVs • 2013 strategic review resulted in focus shifting to protection and monetization of the VIRUSMAX™ IP – January 6, 2014: commenced a U.S. patent infringement litigation against Novartis in Texas – January
Slide 11: Livestock Semen Sexing Technology
Livestock Semen Sexing Technology 11
Slide 12: Dairy Products Are a Major Source of Dietary Protein
Dairy Products Are a Major Source of Dietary Protein *Health Canada; Canadian Nutrient File (CNF), 2007 12 TSX:MBX
Slide 13: By 2050, the World's Population Will Require 100% More Protein
By 2050, the World’s Population Will Require 100% More Protein • As per capita income >$5,000/year, diets shift from grains to animal protein • Increased land use can only address 20% of need for more protein • LumiSort™ will contribute to closing the protein gap by optimizing dairy and beef product
Slide 14: Sex Preselection Advantage to Farmers
Sex Preselection Advantage to Farmers • Dairy farmers want female calves – Replace 35% of their herd every year – Females are the only ones that produce milk – Cows need to be constantly bred to keep producing milk – Recent studies: cows pregnant with female fetuses produce 2.5% more milk 14 TSX:MBX
Slide 15: Global Livestock Semen Market Is Well-Established
Global Livestock Semen Market Is Well- Established • Almost all dairy cows are artificially inseminated with a “straw” purchased from a semen distributor * Despite strong drivers, technology limitations have resulted in sexed semen capturing <5% of market TSX:MBX
Slide 16: LumiSort Overcomes the Low Yield and Fertility Rate Issues
16 LumiSort™ Overcomes the Low Yield and Fertility Rate Issues That Hamper Competitive Technology Competitor Lumisort™ • Sex identification • Sex identification <50% efficient >90% efficient “Killing” Laser • Fluid sprayed into • Undesired cells + droplets rendered infertile – – Droplet size = • Con
Slide 17: Value Proposition of LumiSort
Value Proposition of LumiSort™ Segment Technology Competitor LumiSort™ PRODUCERS (Farmers) Accurate Sex Selection High Fertility rates SEMEN DISTRIBUTORS 270 Straws 90 Straws Yield Per Ejaculate (@ $20 each = (@ $20 each = $1,800) $5,400) Productivity 9-10 Straws/Hour 90 Straws/Hour 17 TSX:MBX
Slide 18: Already Negotiated Term Sheet Agreements with 25% of Global Livestock Genetics Companies
Already Negotiated Term Sheet Agreements with 25% of Global Livestock Genetics Companies Small sales force ~40 semen distributors requirement service global market We provide equipment No entry/capital cost Producers operate for customers We maintain Sexed semen is Significant distributor
Slide 19: Significant Revenue Potential Even at Low Penetration Rates
Significant Revenue Potential Even at Low Penetration Rates Estimated Straws Purchased ~ 200 Million Worldwide Average Lumisort™ Revenue $4.15 Per Straw Sold LumiSort™Annual Revenues ($ in millions) Annual Revenue Level $50 $100 $200 $400 Market Share Required 6.0% 12.1% 24.1% 48.2% TSX:MBX
Slide 20: Strong Patents Will Help Drive Widespread Market Adoption
Strong Patents Will Help Drive Widespread Market Adoption • LumiSort® U.S. patent 8,004,661 granted August 24, 2011 – Sexing Technologies has twice challenged the patents – USPTO has rejected these challenges both times • Patent filed internationally in large dairy and beef producing countries – Can
Slide 21: 2014 Strategic Plan for LumiSort
2014 Strategic Plan for LumiSort™ • Prove our patent claims work in practice • Prototype will process sperm cells by year’s end – Dedicated funding in place • Lathrop Engineering engaged to build and test prototype • Target completion end of 2014 – Industry showcase event upon completion 21 TSX:MBX
Slide 22: Summary
Summary In Summary • Growing and profitable commercial virology business • Well defined, significant new LumiSort™ market opportunity • VIRUSMAX™ potential “free call option” • Strong management team with a record of industry success • Near- and mid-term value inflections 22 TSX:MBX
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