corporate presentation february 2020 · treatment costs relative high costs for ivf treatment...

Corporate PresentationFebruary 2020

This presentation includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements regarding our expected future financial position, results of operations, cash flows, financing plans, business strategies, products and services, competitive positions, growth opportunities, plans and objectives of management for future operations, as well as statements that include words such as "anticipate," "if," "believe," "plan," "estimate," "expect," "intend," "may," "could," "should," "will," and other similar expressions are forward-looking statements. All forward-looking statements involve risks, uncertainties and contingencies, many of which are beyond our control, which may cause actual results, performance, or achievements to differ materially from anticipated results, performance, or achievements. Factors that may cause actual results to differ materially from those in the forward-looking statements include those set forth in our filings at www.sec.gov. We are under no obligation to (and expressly disclaim any such obligation to) update or alter our forward-looking statements, whether as a result of new information, future events or otherwise.

For Safety and Efficacy information: https://invobioscience.com/wp-content/uploads/2018/11/P-008_INVO-IFU-Nov-2018.pdf

FORWARD LOOKING STATEMENTS

2 | INVO Bioscience

INVO has created the INVOcell

an FDA-cleared Device

A disruptive and novel fertility

treatment option compared to

traditional In-Vitro Fertilization

THE INVOcell SYSTEM

4 | INVO Bioscience

CULTURE DEVICE

RETENTION DEVICE

The culture device holds the

eggs and sperm. It is about

1.5 inches tall and just over 1

inch wide.

The retention device, with the

culture device in it, is then

placed in the vaginal cavity.

INNER CHAMBEREggs & sperm are placed in the

Inner Chamber of the Culture

Device

1.5”

1”

THE INVO PROCEDURE

5 | INVO Bioscience

INVOcell is the first intravaginal

culture (IVC) device used for

the incubation of eggs and

sperm during fertilization and

early embryo development

Uses the women’s body for

natural incubation as an

alternative to traditional in-vitro

fertilization (IVF) that uses

incubators for fertilization and

embryo development

IUI was reported to

have an 8-10% rate of clinical

pregnancy success

Retrospect data reflected a

52% clinical pregnancy success

rate, based on Society for Assisted

Reproductive Technology (SART) 2017

preliminary national data (5-day incubation).

Retrospect data reflected a

52% clinical pregnancy success rate,

based on Society for Assisted

Reproductive Technology (SART) 2017

preliminary national data.

INVOcell SUCCESS – PATIENT OUTCOMES

6 | INVO Bioscience

INVOcell (IVC)

~52%SUCCESS

IUI

8-10%SUCCESS

IVF

~52%SUCCESS

Infertility Treatment Options

Source: ESHRE, SART

COMPANY HIGHLIGHTS

7 | INVO Bioscience

FDA Cleared; CE Mark;

Patented Device

$17-$20 Billion

Industry Growing at

8-10% Annually

Pivotal U.S.

Commercialization

Agreement with Industry

Leader (Ferring

Pharmaceuticals)

Vast Underserved

Global Market 95%+ of

Infertile Couples go

Untreated

A Significant Unmet

Market Opportunity

INVOcell Addresses

Critical Industry

Challenges Regarding

Treatment Cost &

Capacity Constraints

Ability to Help Treat the

Underserved Couples

Commercialization

Internationally, with

Recent Distribution &

JV Agreements Signed

239% Revenue Growth

YTD 2019

Source: Allied Market Research, Grandview Research, CDC

SIGNIFICANTLY UNDERSERVED MARKET

8 | INVO Bioscience

7% - 15%

Estimated percentage of reproductive age women

suffer from infertility worldwide

~2.5 M

IVF cycles performed worldwide

<5%

Large underserved patient base with only a small

percentage receiving care

Served Underserved

Over 95% of the infertile couples remain untreated resulting in a significant unmet market opportunity.

Source: ASRM, SART, CDC

INDUSTRY CHALLENGES

9 | INVO Bioscience

INVOcell Helps Address The Two

Biggest Infertility Industry Challenges

Treatment Costs

► Relative high costs for IVF treatment – reduces affordability for many

Infrastructure and Capacity Constraints

► Limited number of IVF clinics – and clustered in population centers, which drives up costs for patients in rural areas

► Clinic throughput (volume limits) – lab capacity limitations

► Industry simply does not have enough capacity to handle the needs

$17-20 BillionThe global infertility market is estimated to be $17-20 billion

Growing at 8–10% per year

Source: Allied Market Research, Grandview Research, CDC

Analysis indicates that a 50% reduction in the price of IVF services would translate into a 160% increase in utilization of such services.

KEY BARRIERS TO TREATMENT: COST

10 | INVO Bioscience

1.5 1.5

2.4

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

Current # of WW IVF Procedures Implied Growth in IVC Based on Cost/Benefit

# o

f IV

F/IV

C P

roce

du

res

(in

Mill

ion

s)

Cost Has Been Identified As The #1 Barrier To Utilization Of IVF

Source: Chambers, Georgina M. et al. "The Impact Of Consumer Affordability On Access To Assisted Reproductive Technologies And Embryo Transfer Practices: An International Analysis". Fertility and Sterility 101.1 (2014): 191-198.e4. Web.


HOW DOES INVOcell SAVE COSTS?

LESS LABORATORYSPACE NEEDED

FEWERULTRASOUNDS

FEWERAPPOINTMENTS

LESS MEDICATION

Fertilization, Conception And Embryo Development Occur Inside The Body Not In A Laboratory

NATURALINCUBATION

PATIENTSAVINGS

Traditional IVFtreatment with medication

$12,000 - $15,000

PER CYCLE*

VS

$5,000 - $9,000

PER CYCLE*

INVOcell IVC treatment with medication

* Excluding optional add-on’s (ICSI, Egg Freezing, Genetic Testing)

# of Clinics# of Clinics/

Million Population

India 1,500 1.1

Japan 574 4.5

United States 450 1.4

China 400 0.3

Italy 354 5.9

Brazil 200 1.0

Russia 200 1.4

Turkey 154 1.9

South Korea 154 3.0

Spain 150 3.2

Germany 125 1.5

Sri Lanka 110 5.1

France 101 1.5

Australia 100 3.9

Senegal 100 6.2

UK 82 1.2

Mexico 81 0.6

Taiwan 78 3.3

Thailand 75 1.1

Egypt 70 0.7

KEY BARRIERS TO TREATMENT: ACCESSIBILITY


Lack of infrastructure

(clinics) hinders access to

treatment in many parts of

the world

Source: CDC, IFFS Global Surveillance, Canaccord Adams

Many Large Global Markets Are Underpenetrated Relative To Global Leaders

INVOcell HELPS ADDRESS ACCESS TO CARE CHALLENGE

LAB REQUIREMENTS INCREASED VOLUMEDECENTRALIZATION

► Lower CapEx = ~$75k vs. ~$500k for IVF

► Eliminate Incubator Capacity Constraints

► Reduced Lab needs► Reduced Lab Labor

► Lower barriers to establish clinics

► Ability to increase the number of clinics

Increased Points of Care Reaching More Patients (with lower costs) Tapping into Underserved Population

► More Points of Access (clinics) for patients

► Ability to treat higher volume of patients per clinic



PATIENT ADVANTAGES

INVOcell

Equivalent Pregnancy Rates

Low Cost Per Cycle

Improved Accessibility To Treatment

Natural And Emotionally Connected Experience

Reduced Risk Of Lab Mistakes

Fewer Drugs – Lower Stimulation

COMMERCIALIZATION

MULTI-PRONGED COMMERCIALIZATION STRATEGY


DISTRIBUTION JOINT VENTURECOMPANY-OWNED

CLINICS

► Potentially upfront rights fee

► INVO Bioscience to supply INVOcell device at predetermined pricing

► Country/region exclusivity likely

► Minimum purchase obligations

► Partner with well-established market operator to create INVOcell Clinics

► INVO Bioscience to provide the device, training and general technology support

► JV partner will be responsible for the operations of the INVOcell clinics, including entire IVC process

► INVO Bioscience to open company-owned clinics, likely with an established physician-operator

► INVO Bioscience to provide the device, training and general technology support along with responsibility for clinic operations

U.S.: FERRING DISTRIBUTION


Ferring Pharmaceuticals Commercialization AgreementJanuary 2019

► INVO Bioscience and Ferring Pharmaceuticals entered into an exclusive U.S. license and distribution/supply agreement for

INVOcell® – Executed in January 2019.

► $5M up front payment received upon signing; $3M additional payment due upon completion of specific milestone (5-day label enhancement); supply agreement

► Ferring will be responsible for all U.S. commercial activities for INVOcell, excluding opportunities INVO Bioscience retains to establish INVO-only clinics.

► Ferring is required to purchase annual minimum device quantities from INVO in order to maintain U.S. exclusivity during the 7-year term.

► INVO Bioscience will be responsible for manufacturing and supplying product to Ferring.

Market = ~ 284,000 IVF Cycles per Year

AFRICA/EURASIA: DISTRIBUTION


Africa/EurasiaDistribution AgreementsQ4 2019

► INVO Bioscience entered into commercialization agreements in the continent of Africa with G-Systems covering Nigeria, and Quality Medicine covering Uganda, Sudan and Ethiopia. Following standard administrative requirements by each company to begin supplying INVOcell in the country, the Company believes distribution will commence in 2020. Each agreement includes minimum annual purchase requirements.

► INVO Bioscience entered into distribution agreements with OrcanMedical for Turkey, a leading medical distributor to large medical device companies including St. Jude Medical, Cooper Surgical, and Clarus, within the country. Orcan Medical will become the exclusive commercial partner for INVOcell in Turkey, contingent upon minimum purchase and other requirements.

► INVO Bioscience entered into distribution agreements with Biovate covering Jordan. Biovate will act as the exclusive distribution partner for INVOcell in the country following standard administrative requirements to begin supplying INVOcell in the country.

~ 125,000 IVF Cycles per Year

INDIA: MEDESOLE JOINT VENTURE


Medesole Healthcare and Trading Pvt LtdJoint VentureJanuary 2020

► INVO Bioscience and Medesole entered into joint venture to operate dedicated INVOcell clinics in India in January 2020.

► Under terms of the agreement, INVO Bioscience and Medesole will each own 50% of the joint venture. INVO Bioscience will provide the device, training and general technology support to the joint venture, while Medesole will be responsible for the operations of the INVOcell clinics in India. Both partners will equally invest in start-up and capital expenditures and share in the revenue and profits of the joint venture.

► Medesole INVO Bioscience Private Limited, has set an initial objective of opening three INVOcell clinics over the next 12 months, with additional clinics planned in subsequent years. Based on the initial first year plan, INVO Bioscience anticipates it will invest approximately $150,000 to $200,000 in the JV. Subsequent investments will be based on JV performance and mutual agreements between INVO Bioscience and Medesole.

~ 110,000 IVF Cycles per Year

KEY INTERNATIONAL TARGET MARKETS


China

► Active Discussions► JV-Type Focus► ~700,000 IVF Cycles Per Year

Europe

► Multiple Markets In Discussion► Various Types► ~700,000 IVF Cycles Per Year

► Active Discussions ► Standard Distribution

Mexico

► Multiple Markets In Discussion ► Various Types

South America

► Multiple Markets In Discussion► Various Types

Other Southeast Asia

► Registration Underway ► Seeking Partner► ~450,000 IVF Cycles Per Year

Japan

CLINICAL TRIAL TO EXPAND LABELOPPORTUNITY TO RECEIVE $3 MILLION MILESTONE PAYMENT


INVO Has Commenced a Clinical Trial Aimed at Expanding INVOcell Label to 5-day Incubation

Expand currently approved label from 3-day incubation to 5-day incubation

Pivotal trial will be a single arm, multicenter, open label trial at three clinical sites in the United States with each site enrolling 60 patients between the ages of 18 and 37 years old.

Align marketing with current standard IVF treatment

Update INVOcell clinical success rate

Receive $3 million milestone payment from Ferring

KEY ACCOMPLISHMENTS AND 2020 GOALS


Recent Accomplishments 2020 Goals

Signed major U.S. commercialization agreement

Expand international business development team

Expand regulatory clearance in key countries, including CE Mark

Sign first major international distribution agreements

Sign first joint venture agreement to open INVOcell clinics

Diversify and expand revenue base with a goal to more than double revenues

Open first INVOcell clinics

Complete 5-day label Clinical Study

Sign additional major international agreements (JV or distribution)

Continue to improve Public Company profile and overall investor base

REVENUE


$11,689$50,901

$282,145

$494,375

$1,151,641

$0

$200,000

$400,000

$600,000

$800,000

$1,000,000

$1,200,000

$1,400,000

2015 2016 2017 2018 9 months ended09/30/19

INVO Bioscience, Inc.Consolidated Statement of Operations Income Statement

For the Nine For the Twelve For the Twelve For the Twelve For the Twelve

Months Ended Months Ended Months Ended Months Ended Months Ended

September 30, December 31, December 31, December 31, December 31,

2019 2018 2017 2016 2015

Revenue:

Product Revenue 615,927$ 494,375$ 282,145$ 50,901$ 11,689$

License Revenue 535,714$ -$ -$ -$ -$

Total Revenue 1,151,641$ 494,375$ 282,145$ 50,901$ 11,689$

Cost of sales 111,186 90,367 51,954 15,094 7,810

Gross margin 1,040,455 404,008 230,191 35,807 3,879

Selling, general and administrative expenses 2,087,725 3,038,068 870,612 2,146,221 598,953

Total Operating Expenses 2,087,725 3,038,068 870,612 2,146,221 598,953

Loss from Operations (1,047,270) (2,634,060) (640,421) (2,110,414) (595,074)

Total other expenses 332,677 442,031 61,742 13,838 4,364,173

Income (Loss) before income taxes (1,379,947) (3,076,091) (702,163) (2,124,252) (4,959,247)

Provision for income taxes (30,509) - - - -

Net Loss (1,410,456)$ (3,076,091)$ (702,163)$ (2,124,252)$ (4,959,247)$

Basic net loss per weighted average shares of common stock (0.01)$ (0.02)$ $ (0.00) (0.02)$ (0.04)$

Diluted net loss per weighted average shares of common stock (0.01)$ (0.02)$ $ (0.00) (0.02)$ (0.04)$

Basic weighted average number of shares of common stock 155,106,340 147,333,051 141,305,050 139,196,557 128,567,615

Diluted weighted average number of shares of common stock 155,106,340 147,333,051 141,305,050 139,196,557 128,567,615


INCOME STATEMENTConsolidated Statement of Operations

KEY STATISTICS


INVO Bioscience (OTCQB: IVOB) Data as of 2/19/2020

Market Cap $40 million

Stock Price | 52-Week Range $0.26 | $0.18 - $0.48

Basic Shares Outstanding 156 million

FD Shares Outstanding 159 million

Management Ownership 23%; 50% when including founder and certain key holders

Free Trading Shares 52 million

Cash (9/30/19) $2.0 million


INVESTMENT RECAP

INDUSTRY

PRODUCT

Commercialization

► Multi-billion dollar, large and growing global market opportunity

► Significantly underserved market

► Revolutionary, FDA-approved device, that we believe is a major breakthrough in the fertility industry.

► High margins

► Commercialization efforts greatly enhanced with recently-signed partnership with Ferring, a multi-billion pharma company; along with large international opportunities

MANAGEMENT


Steven M. ShumChief Executive Officer and DirectorRecently served as Chief Financial Officer of Eastside Distilling (NASDAQ: EAST) since October 2015. Prior to joining Eastside, Mr. Shum served as an Officer and Director of XZERES Corp, a publicly-traded global renewable energy company, from October 2008 until April 2015 in various officer roles, including Chief Operating Officer from September 2014 until April 2015, Chief Financial Officer, Principal Accounting Officer and Secretary from April 2010 until September 2014 (under former name, Cascade Wind Corp) and Chief Executive Officer and President from October 2008 to August 2010.

Michael J. CampbellCOO and VP of Business Development and DirectorMost recently the Vice President of IVF Americas Business Unit for Cooper Surgical, Inc. (CSI), a wholly owned subsidiary of The Cooper Companies (NYSE: COO). Mr. Campbell has substantial medical device sales, marketing and business development leadership experience within Global Fortune 500 and Start-up Company environments.

Lori KahlerVice President of Global OperationsOver 25 years domestic and international experience in operations, quality, regulatory, compliance and clinical affairs, with proficiency across a full range of business functions and systems. Lori was instrumental in achieving FDA De Novo clearance for INVO Bioscience’s innovative INVOcell System.

Pressly AhammedDirector of International Business DevelopmentHas worked over the last 11 years in numerous segments of the international healthcare sector including hospitals; wholesale and retail sectors; and distribution. Ahammed joined INVO Bioscience from Cooper Surgical, where he held a similar title focused on women's healthcare business development in Eastern Europe, the Middle East, Africa, and South and Central Asia.

Kevin Doody MDMedical Director and DirectorRenowned fertility specialist who is the founder and Medical Director for theCenter for Assisted Reproduction (CARE Fertility) and Effortless IVF located inBedford Texas. Dr. Doody is President of the Society for Assisted ReproductiveTechnology (SART), on the Board of Directors of the American Society forReproductive Medicine (ASRM) and a member of the RESOLVE PhysicianCouncil.

Kathleen KarloffChair of Board and former CEOOver 30 years of experience in medical device and pharmaceutical manufacturing, clinical operations, regulatory affairs and quality systems with 13 years at Boston Scientific and 18 years on the senior management teams of start-up organizations.

PATENTS & APPROVALS


► Container assembly for intravaginal fertilization and culture and embryo transfer and method of intravaginal culture employing such a container

► Europe, China, and Japan

► Incubation and/or storage container system and method► Patent #US 7,759,115. Additional patents pending► US, Europe, UK, France, Germany, Russia and India

► Registrations► United States

► FDA Clearance of De Novo Class II device in November 2, 2015► Canada

► Health Canada approved► Europe

► CE Mark (received Oct 2019)► India

► Product registered► Brazil

► ANVISA approved► Colombia

► New INVIMA in process► Mexico

► Registration in process.

corporate presentation february 2020 · treatment costs relative high costs for ivf treatment...

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