Edwards Lifesciences. Patient-Focused Innovations for Structural Heart Disease and Critical Care Monitoring

Transcription

1 Edwards Lifesciences Patient-Focused Innovations for Structural Heart Disease and Critical Care Monitoring

2 Cautionary Statement Presentations and comments made today by the management of Edwards Lifesciences Corporation will include forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of These forward-looking statements can sometimes be identified by the use of words such as may, will, should, anticipate, believe, plan, project, estimate, expect, intend, guidance, outlook, optimistic, aspire, confident or other forms of these words or similar expressions. These may include, but are not limited to, the company s financial goals or expectations for 2017, 2018 and beyond (including sales, earnings per share and its key components, taxes, and other financial expectations, such as several of these measures expressed as percentages); potentials for fluctuations in financial results due to new accounting standard on stock-based compensation; expectations for our products (including the timing and results of clinical trials, regulatory approvals and reimbursement coverage); industry growth projections, the ability to extend leadership positions; forecasted trends in patient treatment and demographics; strategies for the company s new and existing products; and the impact of foreign exchange, and special items on the company s results. Forward-looking statements are based on estimates and assumptions made by management of the company and are believed to be reasonable, though they are inherently uncertain and difficult to predict. Our forward-looking statements speak only as of the date on which they are made and we do not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of the statement. If the Company does update or correct one or more of these statements, investors and others should not conclude that the company will make additional updates or corrections. Forward-looking statements involve risks and uncertainties that could cause actual results or experience to differ materially from that expressed or implied by the forward-looking statements. Factors that could cause actual results or experience to differ materially from that expressed or implied by the forward looking statements are detailed in the company's filings with the Securities and Exchange Commission including its Annual Report on Form 10-K for the year ended December 31,

3 Use of Non-GAAP Financial Measures Unless otherwise indicated, all figures are GAAP financial measures Underlying growth rates are non-gaap items and exclude foreign exchange fluctuations, sales return reserves associated with THVT product upgrades, the positive impact of 2017 THVT stocking sales in Germany, the negative impact of de-stocking, and other special items. Adjusted earnings per share is a non-gaap item computed on a diluted basis and excludes impairment of long-lived assets, intellectual property litigation expenses, amortization of intellectual property, fair value adjustments to contingent consideration liabilities arising from acquisitions, realignment expenses, the positive impact of 2017 THVT stocking sales in Germany, and the negative impact of de-stocking, and other special items. Other non-gaap guidance may exclude special items on a similar basis. A reconciliation of non-gaap historical financial measures to the most comparable GAAP measure is available at The Company is not able to provide a reconciliation of future projections that exclude special items to expected reported results due to the unknown effect, timing and potential significance of special charges or gains, and management s inability to forecast charges associated with future transactions and initiatives 3

4 Edwards Patient-Focused Innovation Strategy Focus Singular focus on the large unmet needs of structural heart and critically ill patients Innovation Pioneer breakthrough technologies with superior evidence Leadership Lead groundbreaking standards of care through trusted relationships Create meaningful value by transforming patient care 4

5 Strengthening Global Leadership Over 95% of sales from products in #1 global positions $1.7B $ B Surgical Heart Valve Therapy Critical Care 18% 2017E Underlying Sales Growth Rates 9% Europe 15% U.S. Japan Transcatheter Heart Valve Therapy 17% ROW E Serving patients worldwide * 2017 estimated adjusted sales by product line and underly ing sales growth rates by region Guidance as of 12/7/17; not an update 5

6 Edwards Focused Innovation Strategy Has Produced Sustained Organic Sales Growth Focused on opportunities where patient demand is very large Edwards Adjusted Sales ($ in billions) High End $3.2-$3.4* Track record of triple wins: Improved patient outcomes Enhanced quality of life Cost effective $1.2 $1.3 $1.4 $1.7 $1.9 $2.0 $2.3 $2.5 $2.7 Long term investments have yielded high value, organic growth E *Guidance as of 12/7/17; not an update 6

7 Business Overview Strong Leadership Positions 7

8 The Leader in ~$3B Global Transcatheter Heart Valves Primary growth drivers: indication expansion, technology advances, and therapy awareness Weare investing in groundbreaking trials beyond severe symptomatic Aortic Stenosis (AS) patients We believe the prevalence of aortic stenosis is large, and treatment rates are low Robust pipeline investments expected to generate transformational new product launches Global TAVR opportunity beyond 2021 is significant Expect the TAVR opportunity to exceed $5B by

9 Millions Groundbreaking AS Trials Expand Addressable Patient Population Severe Symptomatic AS Inoperable, High and Intermediate risk indications approved Significant opportunity Treatment rates remain low PARTNER 3 - Low risk trial underway 2 Asymptomatic AS EARLY TAVR Asymptomatic trial underway Addresses a large unmet need 1 Moderate Symptomatic AS TAVR UNLOAD Moderate AS with Heart Failure symptoms trial underway 0 Global Prevalence 1 TAVR UNLOAD is a Investigator Initiated Trial Supported by a Funding Grant from Edwards Lifesciences 1 Nkomo 2006, Iiv anainen 1996, Aronow 1991, Bach 2007, Freed 2010, Lung 2007, Pellikka 2005, Brown 2008, Thourani 2015, and internal estimates. 9

10 Subset of 47,000 Echoes at 5 Hospital Systems Demonstrates Opportunities to Improve Under-Treatment of AS Patients 100% 17% 36% 47% 20% 12% Severe AS by Echo Criteria 1 Judged Mild AS Judged Moderate AS Confirmed Severe Symptomatic AS Referred for Further Evaluation Recommended for Treatment Multiple opportunities to improve diagnosis, referral and treatment 1. Subset met at least one sev ere AS criteria (based on AHA/ACC guidelines) at screening/echo. Analy sis is as of October 25,

11 SAPIEN 3 ULTRA with AXELA Edwards SAPIEN 3 Ultra System Further Elevates the Performance Benchmark of SAPIEN 3 Ergonomic handle design Allows for single-handed control 14F Axela Sheath for all valve sizes Next generation seamless expandable sheath Unique skirt design For enhanced sealing performance On-balloon design Streamlines the procedure Designed for dynamic expansion and contraction, and improved haemostasis Expect CE Mark early 2018, and U.S. approval in late 2018 The SAPIEN 3 Ultra Sy stem is not av ailable f or commercial sale. 11

12 CENTERA CE Mark Approval Expected Early 2018, U.S. Pivotal Trial Planned in 2018 Low incidence of cardiovascular mortality Low incidence of disabling stroke Low incidence of permanent pacemakers No reported moderate or severe paravalvular regurgitation CENTERA valve with unique valve geometry shows sustained clinical outcomes at 6 months CENTERA is not av ailable f or commercial sale. 12

13 Global TAVR Opportunity Beyond 2021 is Significant 2017 ~$3B >$5B Beyond 2021 Asymptomatic Indication M oderate AS Indication Other Future Indications Breakthrough Technologies Therapy Awareness Emerging Market Growth 13

14 Surgical Heart Valve Therapy Focuses on Extending Patient Reach and Elevating Surgery Surgical therapy is forecasted to grow, despite continued TAVR impact in developed markets Advance Core Aortic Leadership - product pipeline is ideal for aortic patients remaining in surgery Transform Mitral Surgery - pipeline elevates the surgical experience for mitral patients best treated with surgery Expand in Strategic Markets - reaching underserved patient populations We are well-positioned to extend our leadership position in the ~$1.8B global surgical heart valve opportunity 14

15 Innovative Product Portfolio Extends our Patient Reach and Drives Growth INSPIRIS The First in a New Class of Resilient Valves EDWARDS INTUITY Elite Enables Less Invasive Approaches and Streamlines Complex Procedures Building upon 10 years of pre-clinical and 5 years of clinical data on RESILIA Average patient age is < 60 years*, signifying significant global mechanical-to-tissue conversion opportunity Driving EU commercial success, while preparing for 2018 launches in the U.S. and Japan Strong sales contributing 2.0+ ppts of SHVT topline growth in 2017 In the US, 50% of cases are for complex procedures, while 40% of isolated cases are minimally invasive On track to represent ~25% of global AVR sales in 2018 * Since launch in Europe 15

16 Harpoon Can Transform Therapy for Many Patients with Degenerative Mitral Regurgitation Mitral Surgical Repair Complex repair performed best by select experts On bypass, open sternotomy; long hospital stay $1-2K annuloplasty device ASP 1 Harpoon Beating-Heart Repair Streamlined therapy performed by many centers Beating-heart, transapical; faster patient recovery ~$20K repair therapy kit ASP Extensive Surgical Use eptfe Suture Low Profile 9F delivery system Ergonomic Handle Integrated deployment mechanism 1. Av erage selling price. Harpoon not av ailable f or commercial sale. 16

17 Building Future Critical Care Growth with Innovation Our new HemoSphere capital platform strengthens our core portfolio We are pioneering predictive analytics to improve decision making for high risk surgical patients with the launch of Hypotension Prediction Indicator (HPI) ClearSight continues to expand penetration into the Enhanced Surgical Recovery global opportunity The leader in the $765M global hemodynamic monitoring industry* *Includes pulmonary artery catheters and pressure monitoring products. 17

18 HemoSphere Platform Builds a Foundation for the Future HemoSphere All-in-One Platform ClearSight Sensor Assisted Fluid Management Next Generation Capital Platform Illustrative Advanced Swan-Ganz Catheter VIGILANCE II REPLACEMENT FloTrac Sensor Hypotension Prediction VIGILEO REPLACEMENT EV1000 REPLACEMENT PHASE I PLATFORM 2018 PHASE II PLATFORM Next 6-12 months PHASE III PLATFORM Next months NEXT GEN PLATFORM 18

19 New Monitoring Categories and Noninvasive Solutions Can Reach More Patients and Drive Growth Acumen Hypotension Prediction Indicator Offers Breakthrough Predictive Analytics ClearSight Expands Enhanced Surgical Recovery Alerts clinicians to address potentially developing low blood pressure events before they occur EV1000 Monitoring Platform Enhanced Surgical Recovery is focused on reducing complications and length of stay >50 peer reviewed studies have shown that ESR improves outcomes 19

20 Transcatheter Mitral and Tricuspid Therapies Significant Growth Opportunities 20

21 Edwards is Poised to Lead the Transcatheter Treatment of Mitral and Tricuspid Valve Patients Opportunity to transform the care of patients with Mitral Regurgitation (MR) or Tricuspid Regurgitation (TR) Transcatheter mitral / tricuspid global opportunity expected to reach $1B+ by 2021 and $3B+ by 2025 Expect to introduce at least one transformational therapy in 2018, 2019 and 2020 Cardioband and PASCAL are early growth drivers, while transseptal replacement therapy should further transform patient care Transforming options for MR and TR patients represents a significant growth opportunity 21

22 Edwards Pursuing Comprehensive Toolbox of New Therapies for Mitral and Tricuspid Valves MITRAL REPAIR MITRAL REPLACEMENT TRICUSPID REPAIR Illustrative Illustrative Cardioband PASCAL Harpoon CardiAQ SAPIEN M3 Cardioband PASCAL (S3 with dock) FORMA Annulus Leaflets Chords Complex / Advanced Annulus Leaflets Complex / Advanced Portfolio offers physicians the possibility of tailoring therapies for MR and TR patients All products listed other than Cardioband Mitral are not av ailable f or commercial sale. 22

23 Anticipate Multiple MR and TR Therapies Launching in EU Illustrative Cardioband MR Cardioband TR PASCAL MR At least one additional therapy U.S. timelines will be paced by pivotal trial enrollment and regulatory strategies Dev ices listed bey ond 2017 are not av ailable f or commercial sale. 23

24 Safe and Effective Transcatheter Mitral and Tricuspid Therapies Would Result in a Large Opportunity $3B+ Growth will be fueled by $0.4B $1B+ Multiple therapies Clinical evidence New indications Therapy awareness

25 Financial Highlights Strong Organic Growth 25

26 2017 Results Exceeding Original Expectations Total underlying sales growth estimated at 14-15% Estimate adjusted EPS growth >25% Strengthened leadership positions Important progress on internal R&D milestones Significant investments in our operations Solidified our leadership in TAVR Launched new SHVT products, overcoming TAVR headwinds Critical Care exceeded expectations Gained early patient experience in multiple breakthrough therapies Advanced promising portfolio in catheter-based solutions for structural heart disease Implementing global supply chain strategy Increased system capacity and redundancy Strengthened global team Guidance as of 12/7/17; not an update 26

27 2018 Expected to be a Year of Continued Growth and Investment in Our Future Underlying sales growth of 9-10% R&D ~16% of sales to drive value creation Continued growth in the treatment of AS through TAVR Momentum in multiple breakthrough structural heart valve therapies Continued investments: Expansion of TAVR Transcatheter mitral and tricuspid therapies Capacity and infrastructure Adjusted EPS of $ $4.30 Innovation in our core leadership franchises of SHVT and CC Guidance as of 12/7/17; not an update * Growth rates and EPS are estimated 27

28 2018 Preliminary Estimated Impact of New Tax Legislation on Edwards Tax Rate Investor Conference Guidance assumed the MDET is re-suspended or repealed 28

29 Planned 2018 Milestones Fuel Future Growth Transcatheter Heart Valves SAPIEN 3 Ultra EU launch SAPIEN 3 Ultra U.S. launch CENTERA EU launch Initiate CENTERA U.S. trial Transcatheter Mitral & Tricuspid Therapies Complete PASCAL CLASP mitral CE Mark trial Initiate PASCAL mitral U.S. trial Cardioband tricuspid CE Mark Initiate Cardioband tricuspid U.S. trial Surgical Heart Valves Harpoon EU launch Initiate Harpoon U.S. trial INSPIRIS U.S. launch INSPIRIS Japan launch Critical Care Launch HemoSphere phase 2 U.S. approval of HPI Initiate U.S. Assisted Fluid Management trial 29

30 Unmatched Pipeline Driving Durable Growth SAPIEN Evolutionary SAPIEN Revolutionary THVT SAPIEN 3 Ultra CENTERA Alterra SHVT INSPIRIS Harpoon EU INTUITY Elite KONECT AVC MultiShot Harpoon U.S. New Mitral* TMTT CC Cardioband MR HemoSphere All-in-One Platform CardiAQ* FloTrac Hypotension Prediction Cardioband TR PASCAL MR EU ClearSight Assisted Fluid Management SAPIEN M3* (S3 with dock) FORMA PASCAL MR U.S. Next Gen Capital Platform* *Illustrativ e purposes only. Products not av ailable f or commercial sale, except Cardioband MR, HemoSphere, INSPIRIS and INTUI TY Elite. 30

31 Edwards is Poised for Long-Term Success Unwavering patient-focused culture motivates and guides our global team Differentiated strategy based on focus, innovation and leadership Innovative R&D to produce breakthrough therapies Credibility and trust with clinicians, regulators, payors and patients Nimble and adaptive business model Well positioned for significant global growth Addressing significant patient needs creates exceptional shareholder value 31

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