merrill lynch 2007 global pharmaceutical, biotechnology & medical device conference february...
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Merrill Lynch2007 Global Pharmaceutical, Biotechnology & Medical Device Conference
February 6-8, 2007
Robert Taub, President & Chief Executive Officer
NASDAQ: OMRI
Innovative Solutions for a Healthier World
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SAFE HARBOR STATEMENT
This presentation contains forward-looking statements. Forward-looking statements provide the company's current expectations or forecasts of future events. Forward-looking statements include statements about the company's expectations, beliefs, plans, objectives, intentions, assumptions and other statements that are not historical facts. Words or phrases such as ‘‘anticipate,’’ ‘‘believe,’’ ‘‘continue,’’ ‘‘ongoing,’’ ‘‘estimate,’’ ‘‘expect,’’ ‘‘intend,’’ ‘‘may,’’ ‘‘plan,’’ ‘‘potential,’’ ‘‘predict,’’ ‘‘project’’ or similar words or phrases, or the negatives of those words or phrases, may identify forward-looking statements, but the absence of these words does not necessarily mean that a statement is not forward-looking.
Forward-looking statements are subject to known and unknown risks and uncertainties and are based on potentially inaccurate assumptions that could cause actual results to differ materially from those expected or implied by the forward-looking statements. The company's actual results could differ materially from those anticipated in forward-looking statements for many reasons, including the factors described in the company’s filings with the SEC, including sections entitled ‘‘Risk Factors’’ and "Management’s Discussion and Analysis of Financial Condition and Results of Operations" in the company's prospectus as filed with the Securities and Exchange Commission on December 15, 2006 and the company’s most recent quarterly reports on Form 10-Q and its current reports on Form 8-K. Accordingly, you should not unduly rely on these forward-looking statements, which speak only as of the date of this press release.
Unless required by law, the company undertakes no obligation to publicly revise any forward-looking statement to reflect circumstances or events after the date of this press release or to reflect the occurrence of unanticipated events. You should, however, review the factors and risks we describe in the reports the company will file from time to time with the Securities and Exchange Commission after the date of this presentation.
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OMRIX Biopharmaceuticals, Inc.
IMMUNOTHERAPYBIOSURGERY
Biopharmaceutical player in protein-based biosurgery and passive immunotherapy
Diversified and synergistic business platforms Hemostasis in surgery backed by Johnson & Johnson Hyperimmunes provide upside potential
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INVESTMENT HIGHLIGHTS
Establishing presence in growing and underpenetrated markets− Expanding market share with commercialized biosurgery product, Evicel;
indication expansion expected in 2H07 − 2H07 Thrombin launch is anticipated to capture market share
Continued growth and profitability− 157% product sales growth ($41.2M YTD Q306 vs. $16.0M YTD Q305)*− $16.7M net income in Q306 vs. net loss of $27.8M in Q305
Visible pipeline of near-term and medium-term product launches− Breakthrough biosurgery product in development addressing brisk bleeding: The Fibrin Patch − Three immunotherapy product candidates to address emerging viral threats
Long-term development, marketing & distribution partnership with Ethicon, a Johnson & Johnson company and dominant player in surgical closure and wound management, including hemostasis
Differentiated business model− Manufacturing commonalities and economies of scale between two business lines− Development costs financed by third parties
* Total revenues: $45.7M YTD Q306, $19.2M YTD Q305
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OUR STRATEGY
BIOSURGERY Execute and expand Ethicon partnership
Develop new products outside of Ethicon relationship
Commercialize hemostasis products in new territories
IMMUNOTHERAPY Three tiered strategy:
− Launch current products in new territories
− Commercialize product candidates
− Rapidly respond to emerging viral threats
Achieve continued growth while maintaining financial discipline
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MARKET OPPORTUNITY - HEMOSTASIS
Source: IMS data, Company Reports and OMRIX EstimatesNote: $ in millions
Fibrin Sealants&
Thrombin Products
$1,100
Fibrin Patch$400
Active hemostats is fastest growing segment of surgical sealant market
Fibrin Sealants&
Thrombin Products
2006 2015
CAGR = 10%
$650 (WW)
$1,500 (WW)
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Gelatin/Collagen-Based
Cellulose-Based
Price per procedure~$50 - $100
Passive HemostatsAction: Mechanical
MARKET SHIFT:TOWARDS ACTIVE AND ADVANCED HEMOSTATS
Advanced HemostatsAction: Combination of
mechanical and physiological
Fibrin Patch
Price per procedureTBD
Active HemostatsAction: Physiological
Fibrin Sealants Evicel™ / Quixil™
Thrombin
Price per procedure~$200 - $500
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EVICEL (US) / QUIXIL (EU): LIQUID FIBRIN SEALANTS
Competitive Advantages Ease of use
− Ready to use in less than one minute (refrigerated)• No mixing or reconstitution required
− Sprays or drips with same device tip Safety
− Human only, no bovine− Needle-free device
Product Overview Used as adjunct to hemostasis in surgery Only commercially available bovine-free fibrin sealant Indicated for liver surgery in US; General hemostasis in EU 2006 US Market: ~$100M, Growing 15% annually
1H07 2H07Evicel Approval Timeline
1H06
PV Surgery IndicationKidney Surgery Indication
General Hemostasis IndicationLiver Surgery Indication
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THROMBIN STAND-ALONE
Product Overview BLA submitted on November 6, 2006 Designed for gradual onset of clotting Component of Evicel registered as stand-alone product
2006 US Thrombin Products Market >300M
Competitive Advantages Ease of use
− Ready to use in less than one minute (refrigerated)• No mixing or reconstitution required
Safety− Human only, no bovine
Partnered with Ethicon− Launch, marketing to be powered by Ethicon leadership
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FIBRIN PATCH:BREAKTHROUGH CONVERGENCE PRODUCT
Product Overview Phase 1 clinical trial commenced on December 6, 2006 Addressing unmet medical need – Hemostasis in severe bleeding scenarios Convergence of Johnson & Johnson’s matrix with OMRIX’s biologicals
Global Market Opportunity $400M
Competitive Advantages Multiple development barriers to entry Lack of comparable product on market
or in development
“#1 project in Ethicon pipeline”Dan Wildman, President Johnson & Johnson Wound Management
Biodegradable matrix
Embedded fibrin sealant biologics
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JOHNSON & JOHNSON PARTNERSHIP OVERVIEW
Exclusive supply, distribution and development agreement OMRIX receives substantial revenue share Johnson & Johnson expands leadership position in hemostasis market
Sales & marketingDevelopment costs
ManufacturingRegulatory submissions
ONE-STOP-SHOP FOR SURGICAL HEMOSTATS
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BEYOND HEMOSTASIS: MARKET OPPORTUNITIES
Internal Wound
Bleeding
Hemostasis
Fibrin Polymer
OMRIX Biopharmaceuticals, Inc.
Ethicon Other Partners
TissueEngineering,
Repair,Regeneration
AdhesionPrevention
Healing
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BIOSURGERY PRODUCT PIPELINE
General Hemostasis in surgery
EvicelTM** (US)
Spine
Adhesion PreventionAdhexil
Phase II Phase IIIPhase IPreclinicalIndicationProgram
Management of brisk bleeding; use on active bleeding sites
Fibrin Patch
General Hemostasis in surgery
Thrombin Stand-Alone*
General Hemostasis in surgery
EvicelTM** (US)
Spine
Adhesion PreventionAdhexil
Phase II Phase IIIPhase IPreclinicalIndicationProgram
Management of brisk bleeding; use on active bleeding sites
Fibrin Patch
General Hemostasis in surgery
Thrombin Stand-Alone*
* Biologics License Application (BLA) submitted on November 6, 2006** Currently approved as adjunct to hemostasis in patients undergoing liver surgery
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THREE MARKETED IMMUNOTHERAPY PRODUCTS
Intravenous Immunoglobulin (IVIG) Currently marketed in Israel Phase 3 study in US by FFF Enterprises
Vaccinia Immunoglobulin (VIG) Biodefense stockpile Treatment of smallpox vaccine related complications
Hepatitis B Immunoglobulin (HBIG) For the prevention of post liver transplant Hepatitis B
re-infection
HYPERIMMUNES:
Provide ongoing protection, prevention and treatment against viral threats and infectious diseases
POLYVALENT IMMUNOGLOBULIN:
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IMMUNOTHERAPY PRODUCT PIPELINE
Avian InfluenzaInfluenza IG **
Primary Immune Deficiency IVIG (US)
Phase II Phase IIIPhase IPreclinicalIndicationProgram
Treatment of complications related to vaccinia vaccination
HT-VIG *High Titer IG
Treatment of West Nile VirusWNIG *
West Nile IG
Avian InfluenzaInfluenza IG **
Primary Immune Deficiency IVIG (US)
Phase II Phase IIIPhase IPreclinicalIndicationProgram
Treatment of complications related to vaccinia vaccination
HT-VIG *High Titer IG
Treatment of West Nile VirusWNIG *
West Nile IG
* We have received NIH Grants for the development of these product candidates** Cooperative Research and Development Agreement (CRADA) with the NIAID
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UPCOMING MILESTONES
sBLA – Supplemental Biologics License Application
PRODUCT 1H07 2H07 2008 2009
Thrombin US Launch
sBLA FilingKidney
EMEA Filing
US LaunchGeneral
HemostasisEU Launch
Fibrin Patch US IND Filing
US Launch
Adhexil US Launch
WNIG Phase 3
IVIG (US) US Launch
Clinical Development
Clinical Development
Phase 3
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DELIVERING RESULTS
$0.0
$5.0
$10.0
$15.0
$20.0
Q305 Q405 Q106 Q206 Q306
Pro
du
ct S
ales
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
70.0%
Gro
ss M
arg
in
Product Sales Gross Margin
$0.0
$5.0
$10.0
$15.0
$20.0
Q305 Q405 Q106 Q206 Q306
Pro
du
ct S
ales
Biosurgery Immunotherapy
Increased Product Volume Drives Margin Expansion
190%
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INCOME STATEMENT & BALANCE SHEET ($ IN THOUSANDS, EXCEPT PER SHARE DATA)
9 Months Ended September 30,
FY 2005 2005 2006* 2006 Guidance
Product Sales $22,478 $16,019 $41,241 $54 - $55M
Total Revenue $27,499 $19,171 $45,721
Operating Income (Loss) ($2,190) ($2,823) $15,415
Net Income (Loss) ($27,712) ($27,805) $16,668
Diluted EPS ($2.45) ($2.48) $1.23 $1.40 - $1.45
As of September 30, 2006Cash and short term investments $40,463*Total debt $1,370 Working capital $47,511Total assets $76,390
* Note: Figures include $15.3 million sales under the UK contract for VIG.
* Note: Figure does not include $51.4 million in net proceeds raised from follow-on offering and exercise of over-allotment completed on December 14, 2006 and January 12, 2007, respectively.
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MANAGEMENT TEAM
Robert Taub, Founder, President and CEO 30+ years pharmaceutical experience; serial entrepreneur Co-Founder of Octapharma AG, a privately-held plasma fractionator Monsanto; Revlon Health Care Group; Baxter International Inc.
Michael Burshtine, Executive Vice President, Chief Financial Officer Former PricewaterhouseCoopers partner Joined in 2004, has worked with OMRIX since 1995
Nissim Mashiach, Executive Vice President, Chief Operating Officer 20 years device and biological experience Joined 1998, prior management experience in leading Israeli pharmaceutical and biotech companies
Orgad Laub, Ph.D., Vice President, R&D Immunotherapy 25 years of biotechnology experience Chiron, Ares Serono and The Weizmann Institute of Science
Israel Nur, Ph.D., Vice President, R&D Biosurgery 15 years of biosurgery experience at Octapharma and OMRIX
Hank Safferstein, Ph.D., JD, Vice President, Business Development 15 years biotechnology and pharmaceutical experience Bristol-Myers Squibb; The National Institutes of Health; Acorda Therapeutics
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INVESTMENT HIGHLIGHTS
Establishing presence in growing and underpenetrated markets− Expanding market share with commercialized biosurgery product, Evicel;
indication expansion expected in 2H07 − 2H07 Thrombin launch is anticipated to capture market share
Continued growth and profitability− 157% product sales growth ($41.2M YTD Q306 vs. $16.0M YTD Q305)*− $16.7M net income in Q306 vs. net loss of $27.8M in Q305
Visible pipeline of near-term and medium-term product launches− Breakthrough biosurgery product in development addressing brisk bleeding: The Fibrin Patch − Three immunotherapy product candidates to address emerging viral threats
Long-term development, marketing & distribution partnership with Ethicon, a Johnson & Johnson company and dominant player in surgical closure and wound management, including hemostasis
Differentiated business model− Manufacturing commonalities and economies of scale between two business lines− Development costs financed by third parties
* Total revenues: $45.7M YTD Q306, $19.2M YTD Q305
Merrill Lynch2007 Global Pharmaceutical, Biotechnology & Medical Device Conference
February 6-8, 2007
Robert Taub, President & Chief Executive Officer
NASDAQ: OMRI
Innovative Solutions for a Healthier World