full year results presentation for the twelve months to 31 ......full year results presentation for...

FullYearResultsPresentationForthetwelvemonthsto31March2017

24May2017

PacificEdge2017FullYearResultsPresentation

JointanalysisofKaiserPermanentestudycompletedwithpositiveandcompellingresults

OfficialUSlaunchofCxbladderMonitor

NZLaunchCxbladderResolve

Successful$8mshareplacement

NamedinTIN100TopTenHotEmergingCompanies

FY17MILESTONESSignificantProgressAchieved

Officiallaunchofbladdercancer.mesite

Cxbladder MonitorpresentationatAUA

MTANZAwardwinner

InsurancecoveragewithSovereign

Insurancecoveragewithnib

ApprovedprovidertoTRICARE

AddedtostandardofcareforWaitemata DHB

APRIL MAY JUNE JULY AUG SEPT OCT NOV DEC JAN FEB MAR

Slide2


Significantprogressachievedwithtransformationallargescalecustomers

IncontractwithVA

IncontractwithTRICARE

CompletedKaiserPermanenteUserProgrammeandnowincommercialdiscussions

WellprogressedwithCMSregulatoryprocess

Increasingadoptionbyhealthcareprovidersandinsurers

InsurancecoveragebynibandbySovereigninNewZealand

AddedtoStandardofCareforWaitemata DHB

AddedtoStandardofCareforCanterburyDHB

MultipleclinicalstudiesandpapersvalidatingthesuperiorperformanceofCxbladder

Presentations/publications:AmericanUrologicalAssociation2016Conference

AmericanJournalof Urology

UrologicalOncologyAdvancesinTherapy

UrologyspecificmediaGenomeWeb

UrologyTimes

Expanded suiteofCxbladdertests

OfficiallaunchofCxbladderMonitorintheUSinDecember2016

Launchoffourthproduct,CxbladderResolve,inNewZealandinDecember2016

FY17HIGHLIGHTSSignificantcommercialprogressbeingmade;ContinuedsalesgrowthexpectedinFY18

Slide3


FY17REVENUE62%UpliftinProductSales

FY17NZ$(000)

FY16NZ$(000)

Change(%)

Operating Revenue 8,062 4,976 62%

Other revenue 1,473 2,217

Total Revenue 9,535 7,193 33%

Positivegrowthinproductsalesfromnewandexistingcustomers,particularlyinNorthAmerica.

FY17excludesanyrevenuefromtransformationalcustomers.

OtherrevenueincludesfundingfromCallaghanInnovationGrant,withanadditional$3mgrantreceivedinMarch2017,tobespreadovertwoyears.

OPERATINGREVENUE

LABORATORYTHROUGHPUTIncludesUserProgrammesandcommercialtests

35%increaseintest

throughputcomparedtothepreviousyear

Sixmonthfinancialreportingperiod

62% increasein operatingrevenue

comparedtothepreviousyear

0

2000

4000

6000

8000

10000

12000

FY14 FY15 FY16 FY171H 2H

0

2

4

6

8

10

FY15 FY16 FY17

NZ$Million

IHOpRevenue 2HOpRevenue TotalRevenue

Inthepastfouryears,operatingrevenuehasgrownfrom$150,000to$8.1million

Slide4


FY16:FY17REVENUEBRIDGE

FY16

OperatingRevenueGrowth

Grantfunding

FX,Interest,Other

FY17

REVENUEGROWTH

Positivegrowthinproductsales:Nocontributionyetfromnewlargescalecustomers– VAandTRICARE

FY17salesrestrainedby:• Timingofcommercialisationofscalecustomers• TimingoflaunchofnewproductsintheUS• PoliticaluncertaintyintheUSwhichnegatively

impactedonthewiderhealthcaresectorintheUSinthesecondhalfoftheyear.

ChangesinCallaghanInnovationGrowthGrantschememeansthatinternationalinvestmentinR&Disnolongerclaimable

Slide5

+62%


FY17INVESTMENTINTOGROWTH

OPERATINGEXPENSES

Continuedinvestmentintofourstrategicareas:• People– expandedsalesteamfrom12to18salesexecutives• Products– developmentandlaunchofCxbladderResolve• Marketexpansion– investmentintoSouthEastAsiaandUS• IntellectualProperty

Expensesincludenon-cash,non-recurringexpenseof$2.9minrelationtothewindupoftheEmployeeIncentiveScheme

Conservativeapproachtakentobaddebtprovisioning

Operatingrevenueoutgrowingexpenses:OperatingRevenue+62%;OperatingExpenses+6%Note:OperatingExpensescomparedonalike-for-likebasis

Overall,PacificEdgereporteda$21.0millionlossfortheyear,inlinewithgrowthstrategyandmanagementexpectations.

Slide6

FY17$NZ’000

FY16$NZ’000

%Change

TOTALREVENUE 9,535 7,193 33%

Laboratory Expenses 996 1,047

Research 4,908 4,442

SalesandMarketing 1,923 1,021

Other 16,517 16,358

TotalRecurringOperatingExpenditure

24,342 22,870 6%

BadandDoubtfulDebtsExpenditure

3,248 -

Wind upofEmployeeIncentiveScheme(non-cash)

2,925 -

NET(LOSS)BEFORETAX (21,048) (15,453) 36%


FY17CASHFLOW

NETOPERATINGCASHFLOW

Netoperatingcashflowatasimilarleveltothepreviousyear

116%increaseinreceiptsfromcustomersandgrantincomecomparedtoFY17,offsettingthehigherFY17expenses

NETOPERATINGCASHFLOWS FY17$NZ’000

FY16$NZ’000

Receipts fromcustomersandgrantproviders 7,864 3,648

Interestreceived 732 319

Paymentstosuppliersand employees 26,458 20,908

NetGSTchange (25) 12

NET CASHFLOWSFROMOPERATINGACTIVITIES

(17,837) (16,952)

Slide7


FY17FINANCIALPOSITION– BALANCESHEETDebtfree– ShareholderCapitaltheMainSourceofFundingForGrowth

Cashandcashequivalents$14.6millionasat31March2017

Debtfreewithfundingfromsalesrevenue,shareholdercapitalandtechnologygrantsfornewproductdevelopment,commercialisationandinvestigationintoSouthEastAsia

Successful$8.75millionshareplacementtoinstitutionalandotherinvestorscompletedinFebruary2017

Fundsarebeinginvestedintocommercialgrowthasthecompanyworkstowardsattainingacashflowpositiveposition.

FY17$NZ’000

FY16$NZ’000

Cash,CashEquivalentsandShortTermDeposits

14,564 24,160

Trade Receivables,InventoryandOtherCurrentAssets

7,833 6,933

Property, PlantandEquipment 837 990

IntangibleAssets 329 248

TotalAssets 23,563 32,331

Payables andAccruals 2,734 2,523

TotalLiabilities 2,734 2,523

Equity 20,829 29,807

Slide8


IncidencerankingfortheUSA


CXBLADDERNOWDOMINATESTHECLINICALPATHWAY

• Delivering innovative solutions for the early detection and bettermanagement of bladder cancer

• Four products serving multiple clinical needs, across thehaematuria and bladder cancer clinical pathways

• Provides a huge opportunity and significant competitive advantagefor Pacific Edge

• Cxbladder leading to a step change in the clinical pathways forhaematuria and bladder cancer

• Benefits: Accurate, Non-invasive, Simple to Use, Cost Effective

• PrimarymarketistheUS,theworld’slargesthealthcaremarket.

• Fourmainareasofinvestment- People,IntellectualProperty,MarketExpansionandProductDevelopment

Pacific Edge is the only company in the world to offer a suite of proprietary molecular diagnostic tests forbladder cancer, from assessment and detection to management and monitoring for recurrence of the disease

Slide10

PacificEdge2017FullYearResultsPresentation Slide11

TARGETMARKETS


MARKETSGrowingadoptionofCxbladder

Transformationalclients(UnitedStates)

National ProviderNetworks(UnitedStates)

PrivateInsuranceProviders(NewZealand)

Adoption byDistrictHealthBoards(NewZealand)

Veterans Administration– Incontract

TRICARE– Incontract

KaiserPermanente– Incommercialdiscussions

CMS– Wellprogressedinregulatoryprocess

Stratose

FedMed

America’sChoiceProviderNetwork

MultiPlan

SovereignInsurance

Nibhealthinsurance

Bay ofPlentyandLakes

Canterbury

Waitemata

Slide12


MARKETSUSRemainsthePrimaryFocus

COMPLETED √ 18salesexecutivesfocusedon19targetedsalesregions

COMPLETED √ Identified VeteransAdministration(VA),TRICARE,KaiserPermanenteandCentresforMedicareandMedicaidastransformationallargescalecustomers

COMPLETED √ Incontract andagreedpricingwithVAandTRICARE

InProgress Incommercial discussionswithKaiserPermanente;WellprogressedinCMSregulatoryprocess

Ongoing LargeUrologyGrouppractices- Keytargetforscale sales,nowmovingatpace,salesarestartingtomeet companyexpectations

Ongoing PrimaryfocusonestablishingnewUserProgrammeswithlargeinstitutionalcustomersaswebuildmomentum

Ongoing TransitioningexistingUserProgrammestocommercialcustomers

UnitedStates:Theworld’slargesthealthcaremarketOver11,000urologistsandmillionsofpotentialclinicalopportunitiesforuseofCxbladderproducts

Slide13

FY17OBJECTIVESANDPROGRESS:USRemainsthePrimaryFocus


COMPLETED√ SignedFederalSupplySchedule Agreement(Feb2016)

COMPLETED√ Negotiatedcontractpricefortests(2016)

COMPLETED√ Identified leadingVAcentreswithvolumehaematuria

COMPLETED√ CxbladdertestaddedtotheVAscheduleapproved forsaletoveterans:• Cxbladderhasacodewhich ensureseaseofuseand

speedyrecoveryofrevenue• Cxbladderhasacontracted pricewiththeF.S.Sforthe

VA.Sitesmaynegotiateto obtainabetterrate(Volume).

InProgress Targeting fivelargeVAclinics.SeveraloftheseclinicsexpectedtoincorporateCxbladderintotheirclinicalpracticeinthenearfuture.AnticipateUserProgrammes forthelarger keysitesasperotherlargenon-VA customers

VETERANSADMINISTRATION(VA)OneofPacificEdge’sKeyCustomers

VETERANSADMINISTRATION

• Federalfundedhealthcareforveteransandtheirfamilies

• BeingincontractprovidestheabilitytomarketandsellCxbladderproductstotheVA’scliniciansandhealthproviders

• Approximately20millionpeopleundercoverincludingfamilymembers

• Networkofitsownclinics,hospitalsanddedicatedstaff

Slide14

FY17OBJECTIVESANDPROGRESS:ContinuetotargetselectedVAsites


TRICAREOneofPacificEdge’sKeyCustomers

TRICARE

• Healthcareprogramme forUSuniformedservicemembersandtheirfamiliesaroundtheworld

• ManagedbytheDefenseHealthAgency

• 9.4millionbeneficiarieswith70.5millionoutpatientvisitsin2015

• 55Militaryhospitals

• 373militarymedicalcentres

COMPLETED√ Approved asaprovider(October2016)

COMPLETED√ Negotiatedcontractpricefortests(October2016)

InProgress ThePacificEdgeUSsalesteamareleveragingexistingrelationshipswithhighvolumesitesintargeted areas

AnticipateUserProgrammes for thelarger keysitesasperotherlargecustomers

Slide15


KAISERPERMANENTEPotentiallyTransformationalForTheCompany

KAISERPERMANENTE

• Anintegratedmanagedcareprovider,headquarteredinCalifornia

• Fullyintegratedhealthcareincludinginsurancecoverageofitspatients

• Oneofthenation’slargestnot-for-profithealthplans,servingmorethan10.6millionmembers(approx.twicethesizeofNewZealand)

• Morethan18,000physiciansemployedacross38hospitalsandmorethan600medicalofficesandotherfacilities

COMPLETED√ Completionof largescaleUserProgrammeinfirsthalfFY17

COMPLETED √ Jointanalysisofdatacompletedwithpositiveandcompellingfindings

In Progress Study findingstobesubmittedforscientificandclinicalpublication

In Progress InfinaldiscussionswithKaiserPermanenteregardingwhereintheirclinicalpathwaytheywilldeployCxbladder

Slide16

FY17OBJECTIVESANDPROGRESS:CompleteKaiserPermanenteUserProgrammeandprogresstocommercialrelationship


CENTERSFORMEDICAREANDMEDICAID/OTHERCUSTOMERS

CENTERSFORMEDICAREANDMEDICAID

• USfederalagencywhichadministersMedicareandMedicaid

• Medicareisnationalsocialinsuranceprogramprovidinghealthinsuranceforover46millionAmericansaged65andolder

• MedicaidissocialhealthcareprogramforlowincomeAmericanfamiliesandindividuals

InProgress RegulatoryprocesstogainaLocalCoverageDecisionwiththeCMSiswellprogressed

Ongoing USsalesteamcontinuingtotargetindividualurologistsandlargeurologypracticestoinitiatenewUser Programmes,andtransitionearlyadoptersintocommercialcustomers.Thefocuswillbeonlargepracticesinacademiccentres

Workwithacademic centresand hospitalstogainacceptanceofCxbladderintotheircarepathways

Slide17

FY17OBJECTIVESANDPROGRESS:ProgressdiscussionswithCMS

ContinuetoinitiatenewUserProgrammeswithkeycustomers


OTHERMARKETSNewZealand,Australia,SouthEastAsia

AUSTRALIA WorkwithTolmar AustraliatobuildawarenessandincreasesalesofCxbladdertestsinAustralia• Tolmar Australia’sninededicatedurologysalesexecutivesleveragingtheirexistingnetworks;

targetinglargehospitalsaswellasindividualurologists• ThreeproductsnowavailableinAustralia

SOUTHEASTASIA EstablishabaseinSingaporeforfurtherinvestigationintoSouthEastAsia,continuetosupportcurrentUserProgrammeinSingaporeandinitiatenewUserProgrammeswithtargetedhealthcareproviders• CommercialbasenowestablishedinSingaporeincludingdistributionandlogisticsprocesstoallow

testanalysisinNewZealand• WorkingonsigningupnewUserProgrammeswithlargehospitals.SecondUserProgramme

commenced,withSingapore’slargesthospital

NEWZEALAND ContinuetoworkcloselywithhealthcareprovidersandurologistsinNewZealandtoencourageuptakeofCxbladder• AgreementswithseveralDistrictHealthBoardstoincludeCxbladderinclinicalpathway• Cxbladderundercoverbytwohealthcareinsuranceproviders

Slide18


CXBLADDERDETECTIn-Market2013/14

CXBLADDERTRIAGEIn-Market2015/2016

CXBLADDERMONITORNZLaunchDec2015

OfficialUSLaunchDec2016

CXBLADDERRESOLVENZLaunchDec2016USARollout2018

PRODUCTSOurProductsNowSpanTheEntireClinicalPathway- AWorldFirst

FY17OBJECTIVESANDPROGRESS

RolloutofCxbladderMonitorintotheUnitedStatesandAustralia• Australiarolloutcompleted• FullUSAlaunchinDecember2016tocoincidewith

publicationofscientificpaper

LaunchCxbladderResolveinNewZealand• LaunchedinNewZealandinDecember2016

CxbladderincludedinStandardofCareandguidelines• IncludedinAUAguidelinesasanalternativetest• AddedtoStandardofCareforpubliclyfundedCanterbury

DistrictHealthBoard(CDHB)andWaitemata DHB

Slide19


GROWINGCLINICALEVIDENCEINSUPPORTOFCXBLADDER

Slide20

84%

97%

13%

23%

20% 29

%

4%

14%

0%

20%

40%

60%

80%

100%

Low Grade High Grade

Sensitivity by Tumour Grade

Cxbladder Monitor Urine Cytology

NMP22 ELISA NMP22 BladderChek

93% 98

%

33%

92%

0%

20%

40%

60%

80%

100%

Sensitivity NPV

Sensitivity of Cxbladder Monitor vs UroVysion FISH

Cxbladder Monitor UroVysion FISH

SUPERIORSENSITIVITYOFCXBLADDERMONITORINCLINICALSTUDYLotanetal:Clinicalcomparisonofnon-invasiveurinetestforrulingoutrecurrenturothelialcarcinoma.UrologicOncology(2017)

89% 97

%

100%

16%

31%

26%

21%

41%

32%

5%

31%

11%

0%

20%

40%

60%

80%

100%

Ta Tis ≥T1

Sensitivity by Tumour Stage

SUPERIORPERFORMANCEOFCXBLADDERMONITORINRULINGOUTRECURRENCEOFBLADDERCANCER“PerformanceCharacteristicsofaMultigeneUrineBiomarkerTestforMonitoringforRecurrentUrothelialCarcinomainaMulticenter Study”

93%Sensitivity

97%Negative PredictiveValue

COMPELLINGCHANGESINCLINICALDECISIONSWITHUSEOFCXBLADDERTRIAGEANDCXBLADDERDETECT396clinicianbypatientinteractionstotalling792separateclinicaldecisions

• Allurologistschangedtheirclinicaldecisionmaking• 25%reductionintotalnumberofdiagnosticproceduresrequired• 31%reductionininvasivetests

CXBLADDERMONITORSIGNIFICANTLYOUTPERFORMEDALLCOMPAREDFDAAPPROVEDURINETESTSFORBLADDERCANCER“ClinicalComparisonofNon-invasiveUrineTestsforRulingOutRecurrentUrothelialCarcinoma”


SALESCHANNELSBuildAwareness,EncourageAdoption,TransitionToCommercialCustomer

FY17OBJECTIVESANDPROGRESS

In Progress ContinuetoinitiatenewUserProgrammesandtransitionearlyadoptersintocommercialcustomers

• NowstartingtoseetractionasUserProgrammestransitiontocommercialcustomers

InProgress Identifyandinvestigatenewsaleschannels

• Continuetoidentifynewsaleschannels• Enhanced e-commerceplatform

InProgress Increaseonlinemarketingandproductawareness,includingongoingsupportforpatientcommunity,bladdercancer.me

Slide21


LOOKINGFORWARDPrioritiesForFY18

MARKETS

• UnitedStatesremainstheprimaryfocus• NewZealand:ContinuetoencourageuptakebyDHBs• Australia:ConversionofUserProgrammeswithearly

adopters• Singapore:GrowUserProgrammebasewithnewurology

practicesandhospitals

PRODUCTS

• RolloutofCxbladderResolveinAustralia,withsoftlaunchinUSbyyear-end

• LeveragethecombinedpoweroftheCxbladdersuiteacrossthehaematuriaandurologypathwaysaffectingtheStandardofCare

CUSTOMERS

• BringKaiserPermanenteonboardascommercialcustomer• BuildcommercialrelationshipswithtargetedlargescaleVA

facilitiesandurologypracticesthatservicetheactivemilitary• InitiateUserProgrammeswithtargetedVeterans

Administrationsites• CompletetheregulatoryprocessforCenters forMedicare

andMedicaidServices• Transitionearlyadoptersintocommercialcustomers

SALESCHANNELS

• ContinuetoinitiatenewUserProgrammes• Increasedmarketinginvestment,particularlyintodigital

media• Targetinginstitutionalandlargepracticeacademicsitesinthe

US

Slide22


QUESTIONANDANSWER


www.pacificedge.co.nzwww.cxbladder.comwww.pacificedgedx.com

DavidDarlingChiefExecutiveOfficerPacificEdgeLimitedTel:+6434795802Mobile:+6421797981Email:[email protected]


DISCLAIMER

InformationTheinformationinthispresentationisanoverviewanddoesnotcontainallinformationnecessarytomakeaninvestmentdecision.ItisintendedtoconstituteasummaryofcertaininformationrelatingtotheperformanceofPacificEdgeLimited.Theinformationinthispresentationisofageneralnatureanddoesnotpurporttobecomplete.ThispresentationshouldbereadinconjunctionwithPacificEdge'sotherperiodicandcontinuousdisclosureannouncements,whichare availableatnzx.com.NotfinancialproductadviceThispresentationisforinformationpurposesonlyandisnotfinancialorinvestmentadviceorarecommendationtoacquirePacificEdgesecurities,andhasbeenpreparedwithouttakingintoaccounttheobjectives,financialsituationorneedsofindividuals.PacificEdge,itsdirectorsandemployeesdo notgiveormakeanyrecommendationoropinioninrelationtoacquiringordisposingofshares.Inmakinganinvestmentdecision,investorsmustrelyontheirownexaminationofPacificEdge,includingthemeritsandrisksinvolved.Investorsshouldconsultwiththeirownlegal,tax,businessand/orfinancialadvisorsinconnectionwithanyacquisitionofsecurities.FutureperformanceThispresentationcontainscertain'forward-lookingstatements',forexamplestatementsconcerningthedevelopmentandcommercialisationofnewproducts,regulatoryapprovals,customeradoptionandresultsoffutureclinicalstudies.Forward-lookingstatementscangenerallybeidentifiedbytheuseofforward-lookingwordssuchas,'expect','anticipate','likely','intend','could','may','predict','plan','propose','will','believe','forecast','estimate','target','outlook','guidance'andothersimilarexpressions.Theforward-lookingstatementscontainedinthispresentationarenotguaranteesorpredictionsoffutureperformanceandinvolveknownandunknownrisksanduncertaintiesandotherfactors,manyofwhicharebeyondthecontrolofPacificEdgeandmayinvolvesignificantelementsofsubjectivejudgementandassumptionsastofutureeventswhichmayormaynotbecorrect.Therecanbenoassurancethatactualoutcomeswillnotmateriallydifferfromtheseforward-lookingstatements.Anumberofimportantfactorscouldcauseactualresultsorperformancetodiffermateriallyfromtheforward-lookingstatements.Theforward-lookingstatementsarebasedoninformationavailabletoPacificEdgeasatthedateofthispresentation.Exceptasrequiredbylaworregulation(includingtheNZXMainBoardListingRules),Pacific Edgeundertakesnoobligationtoprovideanyadditionalorupdatedinformationwhetherasaresultofnewinformation,futureeventsorresultsorotherwise.NorepresentationTothemaximumextentpermittedbylaw,PacificEdgeanditsadvisers,affiliates,relatedbodiescorporate,directors,officers,partners,employeesandagentsmakenorepresentationorwarranty,expressorimplied,astothecurrency,accuracy,reliabilityorcompletenessofinformationinthis presentation.

ThispresentationshouldbeviewedinconjunctionwithPacificEdge’sFinancialStatementsforthe12monthsto31March2017 andtheaccompanyingmediareleasewhichwasreleasedtothemarketon24May2017

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full year results presentation for the twelve months to 31 ......full year results presentation for...

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