When the question is genetics, the answer is Invitae.

Transcription

1 When the question is genetics, the answer is Invitae. SECOND QUARTER 2018 CONFERENCE CALL AUGUST 7, Invitae Corporation. All Rights Reserved. 1

2 Safe Harbor Statement This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements relating to the company s future financial performance and estimated guidance for 2018; its plans and prospects; its plans to integrate and manage businesses it acquires; the timing of the transfer of its Cambridge facility to San Francisco; the focus of its business strategy; that evidence is growing to expand the use of genetic information; and the company s belief that eventually everyone can benefit from genetic information. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially, and reported results should not be considered as an indication of future performance. These risks and uncertainties include, but are not limited to: the company s history of losses; the company s ability to compete; the company s failure to manage growth effectively; the company s need to scale its infrastructure in advance of demand for its tests and to increase demand for its tests; the risk that the company may not obtain or maintain sufficient levels of reimbursement for its tests; the company s failure to successfully integrate or fully realize the anticipated benefits of acquired businesses; the company s ability to use rapidly changing genetic data to interpret test results accurately and consistently; security breaches, loss of data and other disruptions; laws and regulations applicable to the company s business; and the other risks set forth in the company s filings with the Securities and Exchange Commission, including the risks set forth in the company s Quarterly Report on Form 10-Q for the quarter ended March 31, These forward-looking statements speak only as of the date hereof, and Invitae Corporation disclaims any obligation to update these forward-looking statements Invitae Corporation. All Rights Reserved. 2

3 Momentum building across all key indicators QUARTERLY SUCCESS LEADS TO REVENUE GUIDANCE INCREASE Accessioned volume Revenue Gross profit 73,000 $37.3M $16.9M 64,000 53,000 $25.4M $27.7M $8.3M $9.6M 40,000 $18.1M $5.0M 30,500 $14.3M $3.8M Q2:17 Q3:17 Q4:17 Q1:18 Q2:18 Q2:17 Q3:17 Q4:17 Q1:18 Q2:18 Q2:17 Q3:17 Q4:17 Q1:18 Q2: Invitae Corporation. All Rights Reserved. 3

4 Again increasing annual revenue guidance REAL- TIME INDICATOR Volume TRAILING INDICATOR Revenue Between $135 $140 million in 2018 More than 275,000 samples expected in 2018 TREND TREND TREND TREND Reimbursement Gross Profit COGS Operating Leverage Strong execution on all key indicators Began receiving payment from Medicare for deletion and duplication analysis (CPT code 81433) On track to drive down cash burn by 40-50% compared to Q1 levels exiting Invitae Corporation. All Rights Reserved. 4

5 Expanding our model into reproductive health LAUNCHED COMPREHENSIVE CARRIER SCREENING Informing my health? Carrier screening Fertility & perinatal health Starting a family? Proactive PGT Adult inherited testing Prenatal testing Pediatric testing Neonatal testing Diagnosing a disease? 2018 Invitae Corporation. All Rights Reserved. 5

6 21st consecutive quarter of double-digit growth Accessioned >73,000 samples 139% increase year-over-year 14% increase quarter-over-quarter >72,600 billable tests 24% increase from >58,600 in Q1:18 Accessioned volume 73,000 64,000 53,000 40,000 30,500 Q2:17 Q3:17 Q4:17 Q1:18 Q2: Invitae Corporation. All Rights Reserved. 6

7 Continued improvement in revenue pull through $37.3M in Q2 revenue Revenue 161% increase year-over-year 35% increase quarter-overquarter $37.3M Includes $1.0M in non-test revenue Includes $2.3M in revenue from Medicare for Del/Dup tests delivered in 2017 $18.1M $25.4M $27.7M $14.3M Q2:17 Q3:17 Q4:17 Q1:18 Q2: Invitae Corporation. All Rights Reserved. 7

8 Maintained COGS amidst major new product launch Average cost per sample of $280 COGS per sample 19% reduction year-over-year $345 Flat from prior quarter Continued focus throughout 2018, including integration of reproductive health technologies Cambridge production transferring to San Francisco throughout Q3 $330 $320 $280 $280 Q2:17 Q3:17 Q4:17 Q1:18 Q2: Invitae Corporation. All Rights Reserved. 8

9 Gross profit up considerably from first quarter GROSS PROFIT IN Q2 NEARLY EQUALS FULL YEAR 2017 Gross profit of $16.9M in Q2:18 Gross profit Up from $3.8M in Q2:17 $16.9M Up from $9.6M in Q1:18 Gross margin of 45% in Q2:18 Compared to 27% in Q2:17 Compared to 35% in Q1:18 Continued progress towards 50% gross margin across the Invitae platform $5.0M $8.3M $9.6M $3.8M Q2:17 Q3:17 Q4:17 Q1:18 Q2: Invitae Corporation. All Rights Reserved. 9

10 Leverage from operating expenses Operating expenses of $46.9M in Q2:18 Operating leverage 47% increase year-over-year compared to 139% volume growth 2% sequential increase compared to 14% volume growth Operating expenses expected to grow modestly over next few quarters as acquisitions fully integrated 30,500 samples 40,000 samples 53,000 samples 64,000 samples 73,000 samples Volume OpEx Q2:18 operating expenses included $8.9M in non-cash expenses $6.1M was stock-based comp $46.1M $31.9M $35.9M $43.2M $46.9M Q2:17 Q3:17 Q4:17 Q1:18 Q2: Invitae Corporation. All Rights Reserved. 10

11 Strengthened balance sheet and decreased burn Healthy balance sheet with access to capital totaling over $110M at June 30 th Ended Q2:18 with $91.4M in cash, cash equivalents and investments, including restricted cash 26,000 samples Net proceeds of $53.5M from public offering, closed in early April Additional $20.0M debt available through year-end 2018 $26.5M cash burn from operations in Q2:18 Q2:18 cash burn excludes $53.5M of equity financing and $3.1M of funds from exercise of warrants $28.3M On track to cut cash burn from Q1:18 by 40-50% by year-end 0 ($21.2M) Q1:16 Q2:16 Q4: Invitae Corporation. All Rights Reserved. 11

12 Bring comprehensive genetic information into mainstream medical practice to improve the quality of healthcare for billions of people Driving down the cost of genetic information will increase its personal and clinical utility Healthcare professionals are fundamental in ordering and interpreting genetic information People should own and control their own genetic information Genetic information is more valuable when shared 2018 Invitae Corporation. All Rights Reserved. 12

13 Invitae continues to lead in clinical excellence DELIVERING COMPREHENSIVE ANSWERS TO SERIOUS, COMPLEX QUESTIONS Percent Positive Reports with CNVs 50 Pediatrics Epilepsy Tuberous Sclerosis Neurofibromatosis I Primary Ciliary dyskinesia Charcot-Marie-Tooth Neurology Oncology Cardiology Neuropathies Muscular dystrophies Lynch Syndrome Breast and Gyn cancers Paraganglioma/Pheochromocy Pancreatic Cancer Familial Hypercholesterolemia HHT Aortopathies Prevalence and properties of intragenic copy-number variation in Mendelian disease genes. Truty R, Paul J, Kennemer M, Lincoln SE, Olivares E, Nussbaum RL, Aradhya S. Genetics in Medicine. Published online June 12, doi: /s Invitae Corporation. All Rights Reserved. 13

14 Evidence growing to expand use of genetic information NEARLY THE SAME NUMBER OF WOMEN AT RISK WHETHER IN OR OUT OF CRITERIA Patient Group (#) Breast/GYN Cancer Management Genes (% Positive) Large Hereditary Breast and Ovarian Cancer Panel (% Positive) In-Criteria Patients (3549) 8.4 % 10.5 % Not a significant difference Out-of-Criteria Patients (647) 6.2 % 9.0 % Not a significant difference Underdiagnosis of hereditary breast and ovarian cancer in Medicare patients: Genetic testing criteria miss the mark. Yang S, Axilbund JE, O Leary E, Michalski ST, Evans R, Lincoln SE, Esplin ED, Nussbaum RL. Annals of Surgical Oncology. Published online July 11, doi: /s Invitae Corporation. All Rights Reserved. 14

15 Healthy individuals benefit from proactive testing MORE THAN 16% PRESENTED WITH A MEDICALLY ACTIONABLE GENETIC CONDITION THEY WERE NOT AWARE THEY HAD Genetics in mainstream medicine: Finally within grasp to influence healthcare globally. Aradhya S, Nussbaum RL. Molecular Genetics and Genomic Medicine. Published online May 28, doi: /mgg Invitae Corporation. All Rights Reserved. 15

16 Eventually everyone can benefit from genetic information ANSWERING SOME OF LIFE S MOST SERIOUS AND COMPLEX QUESTIONS Informing my health? Carrier screening Fertility & perinatal health Starting a family? Proactive PGT Adult inherited testing Prenatal testing Pediatric testing Neonatal testing Diagnosing a disease? 2018 Invitae Corporation. All Rights Reserved. 16

17 Q&A: General discussion