veriteq presentation at the global online ceo conference july 2014

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July 2014

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VeriTeQ provides proprietary, innovative healthcare solutions for Unique Device Identification and Bio-Sensing/Radiation Dosimetry applications.

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Page 1: VeriTeQ Presentation at the Global Online CEO Conference July 2014

July 2014

Page 2: VeriTeQ Presentation at the Global Online CEO Conference July 2014

Safe Harbor Statement

2

Statements made in this presentation regarding VeriTeQ Corporation (“VeriTeQ” or “Company”) and VeriTeQ thatare not historical facts are forward-looking statements based on our current expectations, assumptions, estimatesand projections about VeriTeQ and our industry. These forward-looking statements are subject to risks anduncertainties that could cause actual future events or results to differ materially from such statements. Theseforward-looking statements include, without limitation, statements about our proposed name change and reversestock split, our commercialization activities, market opportunities, our strategy, our competition, FDA regulation,partnership opportunities, market penetration, and all other forward-looking statements. You should not placeundue reliance on any of the forward-looking statements made in this presentation. Our actual results could differmaterially from those expressed or implied by these forward-looking statements as a result of various factors,including risks and uncertainties related to the timing or successful completion of our product commercializationactivities, VeriTeQ’s ability to raise capital, and other various risks and uncertainties. Additional information aboutthese and other factors that could affect VeriTeQ’s business is set forth in its various filings with the Securities andExchange Commission, including those set forth in its Form 10-K filed on April 15, 2014, and Forms 10-Q filedon July 16, 2013 and November 14, 2013, and May 14, 2014 under the caption "Risk Factors." The Companyundertakes no obligation to update publicly any forward-looking statements for any reason, even if newinformation becomes available or other events occur in the future.

This presentation does not constitute a prospectus or form part of any offer or invitation to sell or issue, or anysolicitation of any offer to purchase or subscribe for, or any offer to underwrite or otherwise acquire any shares inthe Company or any other securities, nor shall they or any part of them nor the fact of their distribution orcommunication form the basis of, or be relied on in connection with, any contract, commitment or investmentdecision in relation thereto, nor does it constitute a recommendation regarding the securities of the Company.

Page 3: VeriTeQ Presentation at the Global Online CEO Conference July 2014

Company Background

3

VeriTeQ originated as a private company founded in 2011 to acquire and develop core implantable RFID intellectual property for healthcare

Acquired/licensed/developed 100+ patents (issued or

pending)

Multiple regulatory clearances: FDA and CE Mark

Completed share exchange agreement with Digital Angel Corporation on July 8, 2013; company changed its name to VeriTeQ

VeriTeQ shareholders own ~88% of resulting company

Closed $1.5m bridge financing on Nov. 13

Ticker changed to “VTEQ” on Nov. 19

Page 4: VeriTeQ Presentation at the Global Online CEO Conference July 2014

Unique Value Proposition

4

In July 2012, the Healthcare Safety and Innovation Act was signed into law and in Sept. 2013, the FDA issued a Final Rule requiring all medical devices in the U.S. that are re-usable and re-processed to carry a unique device identifier, or UDI, with direct part marking

VeriTeQ’s FDA cleared UDI, called Q Inside Safety Technology, can serve as a direct part marking to help device manufacturers comply with the Final Rule, and can also identify a permanent implantable medical device, in vivo, on demand

Q Inside Safety Technology goes beyond device identification and provides clinical and healthcare benefits via customizable software and data analytics

VeriTeQ also offers FDA cleared radiation dose measurement technologies to protect patients undergoing cancer treatment

VeriTeQ’s implantable and wearable dosimetry products provide radiation levels from the patient to help prevent overdose and under-dose

Page 5: VeriTeQ Presentation at the Global Online CEO Conference July 2014

Company Overview

5

VeriTeQ provides proprietary, innovative healthcare solutions for Unique Device Identification and Bio-Sensing/Radiation Dosimetryapplications

Core Technology: implantable radio frequency (RF) microchip technologyCleared by the FDA as the Predicate Class II medical device in the industry

UDI products enable access to UDI information, in-situ, on demand, at the point of use

A leading industry position to enable compliance with FDA Final Rule

Q Inside Safety Technology also enables data analytics for evidence-based medicine

Bio-sensing technologies for radiation dosimetry provide real-time measurements of received radiation dose from the patient, not the machine

External and internal product applicationsHelps prevent radiation overdosing and under-dosing

Page 6: VeriTeQ Presentation at the Global Online CEO Conference July 2014

Lead Business Areas

6

Medical Device UDI/Q Inside

Safety Technology

Breast Implants and Breast

Implant Sizers

Vascular Ports

Other Reusable and Implantable Medical Devices

Bio-Sensing/Radiation

Dosimeter Technologies

External Radiation Dosimeter

Implantable Radiation Dosimeter

Page 7: VeriTeQ Presentation at the Global Online CEO Conference July 2014

The VeriTeQ UDI System

Medical Devices with

Inside Safety Technology

7

Page 8: VeriTeQ Presentation at the Global Online CEO Conference July 2014

FDA Final Rule

8

The Final Rule requires devices intended to be used more than once and intended to undergo any form of reprocessing before each use, i.e. re-useable/reprocessed medical devices to have a direct part marking (vs. basic labeling on device packaging)

Requires the direct part marking to be provided through either or both of the following:

Easily readable plain text;

Automatic Identification and Data Capture (AIDC), or an alternative technology, that will provide the UDI of the device on demand

Benefits of a UDI System

Allows more accurate reporting and analysis of adverse events to quickly identify problem devices

Reduces medical errors by quickly and accurately identifying a device and its characteristics

Provides a standardized identifier that allows manufacturers, distributors and healthcare facilities to more effectively manage medical device recalls

Provides a consistent way to enter information about devices in electronic health records and clinical information systems

Provides a foundation for a global, secure distribution chain, helping to address counterfeiting and diversion and prepare for medical emergencies

Page 9: VeriTeQ Presentation at the Global Online CEO Conference July 2014

Implantable RFID Microchips Patented and FDA

cleared

Provides the primary key information

Pocket Readers

Patented and FDA Cleared

Pocket Reader

Pocket Reader EX

VeriTeQ’s UDI System: Inside

Database Customization

for device manufacturer

Informatics

Integration with FDA database

9

Page 10: VeriTeQ Presentation at the Global Online CEO Conference July 2014

UDI Business Model

10

VeriTeQ acts primarily as a supplier of its proprietary microchips and readers to medical device manufacturers

Manufacturers incorporate VeriTeQ’s products into their manufacturing processes/distribution strategy (to hospitals, physicians, etc.)

Price per chip = $12-15; gross margin per chip = 65 - 75% marginsPrice per reader = $300-500; gross margin per reader = 40 – 60% margins

VeriTeQ also provides development services to medical device manufacturersPrimary development areas include design and manufacturing process to include chip in their medical device, i.e. new encasement technologies such as special polymers and heat resistant microchips

Avg. price for development per manufacturer = $250,000; gross margin = 50%

Data services include database connectivity to manufactured microchips, application software to collect microchip/medical device model implanted, FDA data base registry and informatics analytics. Priced on per project development ranging from $25,000 to several hundred thousand dollars

Page 11: VeriTeQ Presentation at the Global Online CEO Conference July 2014

Targeted Customers

11

Breast Implant/SizersManufacturers

Vascular Port Manufacturers

Artificial Joint/Sizers

Manufacturers

Heart Value Sizers, Endo/ Surgical

Equipment

Page 12: VeriTeQ Presentation at the Global Online CEO Conference July 2014

Breast Implants

12

VeriTeQ’s Q Inside Safety Technology can be embedded within breast implants and sizers to automatically identify the medical device in situ or after re-sterilization.

Ex-US: Agreement with Establishment Labs/MotivaLeading global breast, body and facial aesthetic company that manufactures advanced silicone-filled breast implants, marketed under the Motiva Implant Matrix brand name

Manufacturing completed and CE Mark certifications achieved

Launched Q1-2014 (EU and UK); Over 500 women implanted

US: Market leading breast implant manufacturer is testing feasibility to integrate the Q Inside in its silicone implants and sizers

Discussions ongoing with the two leading global breast implant manufacturers regarding need to identify their sizers to comply with FDA Final Rule

Company estimates sizer market at 600,000 devices annually

Page 13: VeriTeQ Presentation at the Global Online CEO Conference July 2014

Vascular Ports

13

Partnership with Medcomp (a leading manufacturer of vascular ports) to utilize Q Inside for Medcomp’s FDA-cleared vascular ports

$3 million initial contractual PO commitment from Medcomp

Enables accurate device identification and medication dosage

Hospital studies expected to begin at:Northwestern Memorial in ChicagoNew York-Presbyterian – University Hospital of Columbia and Cornell in NYCleveland Clinic in Cleveland, OH or MD Anderson Cancer Center in Houston, TX

Medcomp /VeriTeQ targeting to set clinical UDI standard to incentivize other port manufacturers to use Q Inside – e.g. C.R. Bard, Smiths Medical, etc.

Page 14: VeriTeQ Presentation at the Global Online CEO Conference July 2014

Artificial Joints and Sizers

14

Identification of implantable and reusable medical devices such as sizers used in joint replacements (subject to Final Rule)

Artificial hips in the U.S.:Number of procedures: 230,000Total annual expenditure: $10.5 billionAverage cost per procedure: $45,000Major manufacturers: Zimmer (24%), Stryker, DePuy/J&J, Biomet, Wright Medical

Artificial knees in the U.S.Number of procedures: 543,000Total annual expenditure: $12 billionAverage cost per procedure: $22,000Major manufacturers: Zimmer (24%), Depuy/J&J, Stryker, Biomet, Smith & Nephew

Active initial meetings/dialog with lead target device manufacturers

Clinical benefits: Q Inside Safety Technology allows for immediate data retrieval; can help quickly resolve adverse event reporting and recalls

As published on July 18, 2011 in 24/7 Wall St.’s Eleven Most Implanted Medical Devices In America

Page 15: VeriTeQ Presentation at the Global Online CEO Conference July 2014

VeriTeQ Bio-Sensors

In Situ Measurement of Radiation Dosages

15

Page 16: VeriTeQ Presentation at the Global Online CEO Conference July 2014

Sensing Technologies

16

VeriTeQ owns Patent 7,125,382 for an “Embedded Bio-Sensor System,” a biological sensor on the end of a radio frequency chip

Temperature (current)

Radiation levels (current)

Blood oxygen (future)

Pulse (future)

Medication levels (future)

i.e. post surgery

Glucose (licensed to a third party)

Others

Page 17: VeriTeQ Presentation at the Global Online CEO Conference July 2014

VeriTeQ Dosimetry

OneDoseExternal Technology

Q Inside SmartMarkerImplantable Technology

Radiation Dose Verification

17

Page 18: VeriTeQ Presentation at the Global Online CEO Conference July 2014

Maximize Tumor Control(High Dose)

MinimizeHealthy Tissue

Toxicity(Low Dose)

The greatest challenge for radiation therapy or any cancer therapy is to attain the highest probability of cure with the least morbidity.1

1) Bucci MK, Bevan A and Roach M. Ca Cancer J Clin 2005;55:117-134

Objective of the Radiation Oncologist

18

Page 19: VeriTeQ Presentation at the Global Online CEO Conference July 2014

Patient Safety & Radiation Overdose

19

2013: #3 Unnecessary exposures and radiation burns from diagnostic radiology procedures

2012: #2 Exposure hazards from radiation therapy and CT

2011: #1 Radiation overdose and other errors during radiation therapy

2009-10: #4 CT radiation dose

2008: #8 CT radiation dose

2007: #5 Radiation therapy errors

According to the ECRI Institute, radiation or CT overdose make the list of the Top 10 Technology Hazards each year going back at least five years

Page 20: VeriTeQ Presentation at the Global Online CEO Conference July 2014

VeriTeQ OneDose ®

20

OneDose® is an FDA-cleared single-use, external dosimetry system used in the radiation oncology suite to verify radiation dose quickly and conveniently at the skin level

Significant IP protection

CE Mark to market products in the E.U.

OneDose is the only wireless, pre-calibrated, disposable, surface sensor on the market that provides an instant readout of the dose delivered

Reimbursement rate per patient (4-6 dosimeters used during treatment) ranges between $260 and $380

In 2010, 1.1 million patients received radiation therapy in the U.S.* with new indications for use in CT and fluoroscopy markets

Researchers at the National Cancer Institute estimate that 29,000 future cancer cases could be attributed to the 72 million CT scans performed in the country in 2007

Over 5 million fluoroscopic procedures performed annually in the U.S.**

* According to a study published by IMV Medical Information Division**National Council on Radiation Protection and Measurements, report No. 168 (2010)

Page 21: VeriTeQ Presentation at the Global Online CEO Conference July 2014

Q Inside SmartMarker

21*Source = ASTRO, American Society of Radiation Oncology

World’s first and only implantable wireless radiation dosimeter; FDA cleared for use in prostate and breast cancer radiotherapy

Enables radiation oncologists to immediately measure the dose of radiation penetrating a tumor or tumor area

Cleared for use in photon external beam and hypo-fractionated treatment protocols

Potential additional new indications for use include lung, colorectal and pancreatic cancer

Only device that confirms radiation dose delivered to tumor

Can also be used as a fiducial marker for localization of the tumor

Device is reimbursable by both Medicare and private insurance

FDA cleared & CE mark; significant patent protection

Approximately 81,580 patients receive seed implants per year in the U.S. and more than 425,000 patients are diagnosed with prostate and breast cancers total each year in the U.S.*

Page 22: VeriTeQ Presentation at the Global Online CEO Conference July 2014

Bio-Sensor Business Model

22

To be sold to radiation oncology centers in the U.S. and E.U.Radiation oncologists, therapists, physicists, dosimetrists

Over 4,400 radiation oncologists in the U.S., with 4 states representing 33% of the U.S. market

To be sold through direct sales, worldwide distribution partners, product specific website, trade associations

Price for One Dose Reader Kit = $499; gross margin = 80%

Price for Q Inside SmartMarker Kit = $1,200; gross margin = 80%

Potential distribution partners:

Page 23: VeriTeQ Presentation at the Global Online CEO Conference July 2014

Intellectual Property

23

VeriTeQ has a robust portfolio of more than 100 patents, patents pending and licenses in the U.S. and abroad. VeriTeQ’s foundation patents are an Embedded Bio-Sensor System on the end of a RF microchip (Patent 7,125,382 issued in 2006), and the use of implantable sensors for monitoring tumors in oncology applications (Patent 6,402,689 issued in 2002). A partial list of the Company’s key patents follows.

Patent No. Title

7,125,382 Embedded Bio-Sensor System

6,402,689 Methods, Systems and Associated Implantable Devices for Dynamic Monitoring of Physiological and Biological Properties of Tumors

7,378,056 Methods, Circuits, and Compositions of Matter for In Vivo Detection of Biomolecule Concentrations Using Fluorescent Tags

7,011,814 Systems, Methods And Devices For In Vivo Monitoring Of A Localized Response Via A Radiolabeled Analyte In A Subject

7,479,108 Implantable Sensor Housing, Sensor Unit And Methods For Forming And Using The Same

7,495,224 Disposable Single-Use External Dosimeters For Use In Radiation Therapies

7,966,054 Disposable Single-Use External Dosimeters For Detecting Radiation In Fluoroscopy And Other Medical Procedures/Therapies

7,491,942 Disposable Single-Use Internal Dosimeters For Detecting Radiation In Medical Procedures/Therapies

7,010,340 Methods, Systems, and Computer Program Products for Providing Dynamic Data of Positional Localization of Target Implants

7,510,699 In Vivo Fluorescence Sensors, Systems, And Related Methods Operating In Conjunction with Fluorescently Labeled Materials

7,557,353 Single-Use External Dosimeters for Use in Radiation Therapies and Related Methods, Systems and Computer Program Products

Page 24: VeriTeQ Presentation at the Global Online CEO Conference July 2014

Leadership Team

24

Scott R. SilvermanChairman & CEO

Mr. Silverman has been Chairman and CEO of VeriTeQ since its inception in Dec. 2011. He served as Chairman and CEO of PositiveID Corp. (OTC:PSID) from 2008 to Aug. 2011, and Chairman and CEO of VeriChip Corp. (NASDAQ:CHIP) from Dec. 2006 to Jul. 2008. He was Chairman of Digital Angel Corp. from 2003 to 2007. From 2003 to 2006, Mr. Silverman served as Chairman and CEO of Applied Digital Solutions (NASDAQ:ADSX). Mr. Silverman is an attorney licensed to practice in NJ and PA, and has more than 15 years of executive experience with technology companies. He is a graduate of the University of Pennsylvania and Villanova School of Law.

Randolph K. GeisslerPresident

Mr. Geissler has been President of VeriTeQ since July 2012. He developed the implantable microchip, with more than 150 million microchips implanted in animals for identification and tracking. He previously served as CEO of Geissler Technologies(2004 - 2008) when he sold the company's product development pipeline. Prior to that, he served as CEO of Digital Angel Corp. (Amex: DOC) (2000 - 2003) and Destron Fearing (Nasdaq: DFCO) (1993 - 1999), a company he founded. He has taken companies public and has broad experience in product development, electronic miniaturization, application of advanced technologies in new markets, and extensive experience in establishing strategic intellectual property and patent portfolios.

Michael KrawitzChief Legal and Financial Officer

Mr. Krawitz was most recently the CEO of Pear Energy, a renewable energy company that finances renewable energy and energy efficiency projects. He previously served as CEO of Florida Sunshine Investments I, Inc., which manages more than $1 billion worth of properties throughout the United States. He is also a member of the Company's Board of Directors. Mr. Krawitz earned a bachelor of arts degree from Cornell University and a Juris doctorate from Harvard Law School.

Allison TomekSr. VP IR & CorporateCommunications

Ms. Tomek has served as Sr. VP of VeriTeQ since its inception and has served as Sr. VP, IR and Corp Comm of PositiveID since January 2007. From Jan. 2007 to Jun. 2008 she was also VP of IR at Applied Digital Solutions and Digital Angel. From 2003 to 2006, Ms. Tomek was Director of IR and Corp Comm at Andrx Corp. (NASDAQ:ADRX). Ms. Tomek is the former President of the National Investor Relations Institute, South Florida chapter and a current member of its Board.

Page 25: VeriTeQ Presentation at the Global Online CEO Conference July 2014

Capitalization

25

SharesHeld

Percent Ownership

Officers and Directors 6,680,854 61%

Float 4,287,988 39%

TOTAL 10,968,842 100%

Page 26: VeriTeQ Presentation at the Global Online CEO Conference July 2014

Near-Term Goals

26

First product launched; marketing of Motiva breast implants with Q Inside Safety Technology in EU/UKEnter into more partnership/supply agreements post Final RuleEnter into partnership for data analytics platform development

Continued expansion of patent portfolio surrounding Q Inside Safety Technology for medical devices

Additional future partnerships

Page 27: VeriTeQ Presentation at the Global Online CEO Conference July 2014

Investment Highlights

27

Unique industry technology and market position for its Q Inside Safety Technology unique device identification products

FDA cleared device that meets the UDI direct marking mandate for reusable medical devices under the FDA Final Rule provides for “first to market” capabilityIP provides strong competitive position for long term strategic advantage

Launch of Q Inside breast implants in Q1 2014Commercial partnership with Establishment Labs/Motiva for ex-US markets

More than 500 women have received Motiva implants with Q Inside Safety Technology Major US manufacturer currently in prototype stagePreparing for immediate expansion into markets for Vascular Ports and Orthopedic Implants Commercial partnership with MedComp in place

VeriTeQ Radiation Dosimetry products – ready to move into commercialization

Radiation dosimeters used in the treatment of cancer

Unique patented technologies with multiple regulatory approvals provide competitive advantage in respective markets

Page 28: VeriTeQ Presentation at the Global Online CEO Conference July 2014

Q&A

Thank you!