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1 [Insert FSCo logo] ASX Spotlight Series New York & London February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993

Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

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Page 1: Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

1

[Insert

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ASX Spotlight Series

New York & London

February / March 2014

Universal Biosensors, Inc. ARBN 121 559 993

Page 2: Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

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[Insert

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logo] Important Disclaimer

This presentation is intended to provide a general outline only and is not intended to be a definitive statement on the subject matter. This presentation is not financial advice and has been prepared without taking into account the objectives, financial situation or needs of a particular person.

Neither the Company, nor its officers or advisors or any other person warrants the accuracy of the analysis herein or guarantees the investment performance of the Company. Investors must make their own independent assessment of the Company and undertake such additional enquiries as they deem necessary or appropriate for their own investment purposes.

The statements contained in this presentation that are not purely historical are forward-looking statements within the meaning of the United States Exchange Act. Forward-looking statements in this presentation include statements regarding our expectations, beliefs, hopes, intentions or strategies regarding the proposed offering. All forward-looking statements included in this presentation are based upon information available to us as of the date hereof, and we assume no obligation to update any such forward-looking statement as a result of new information, future events or otherwise. Our actual results could differ materially from our current expectations.

The Company is subject to a number of risks. For a summary of key risks, refer to the Company’s most recent Form 10-K filed with the United States Securities and Exchange Commission.

Under applicable United States securities laws all of the shares of our common stock are “restricted securities” as that term is defined in Rule 144 under the Securities Act of 1933, as amended. Restricted securities may be resold in the public market to United States persons as defined in Regulation S only if registered for resale or if they qualify for an exemption from registration under the Securities Act. We have not agreed to register any of our common stock for resale by security holders.

Page 3: Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

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[Insert

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logo] UBI investment case

Targeting the attractive Point-of-Care diagnostics (POCD) market

With a powerful POCD technology platform

Profitable business with world leader LifeScan (J&J) in diabetes care

Partnered with world leader Siemens in POC coagulation testing

Pipeline of high value future product opportunities

Experienced, high-calibre management team

Generating revenues from worldwide sales

ASX-listed, SEC compliant, US Company

Page 4: Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

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[Insert

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• UBI Overview

• Blood Glucose Monitoring

• Coagulation Testing

• Future Opportunities

Page 5: Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

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[Insert

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logo] The future of diagnostics is at Point-of-Care

Healthcare Challenges:

• Aging populations, living longer

with chronic conditions

• Skills shortages

• Exploding healthcare costs

• Variable standards of care in

• Remote / regional areas

• Developing economies

Point of Care Diagnostics

(POCD) Technology:

Supports more timely and

frequent diagnosis

Simpler to use

Empowers the patient

Reduces logistics challenge

Better health economics

Page 6: Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

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[Insert

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logo] UBI targets the $15Bn, growing POC market

Central

Laboratory

Testing ~$25Bn Market

~2% Growth p.a.

Source: Espicom, POC Diagnostics – 2011; Management Estimates

Global In-Vitro Diagnostics Market (2012 estimate)

Point of Care

Testing ~$15Bn Market

~10% Growth p.a.

Page 7: Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

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[Insert

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logo] Using UBI’s powerful diagnostic technology

• Well suited to Point-of-Care

Easy to use (requires small drop of blood from finger-prick)

Accurate results (results that are accurate for each individual)

Low cost to manufacture (supports fully automated, scale manufacturing)

• Broad application

• Annuity-based business model

Strips tied to readers

Meter installed base pulls strip sales

• Patent protected (44 patent families)

Disposable Test Strips

Handheld Readers

Page 8: Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

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[Insert

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logo] A paradigm shift in electrochemical sensors

Co-Planar

Electrodes

Opposing

Electrodes

Smaller

sample

volume

Simpler to

manufacture Broad IP

protection

Greater

Accuracy

Page 9: Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

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[Insert

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logo] …and low cost, scale manufacturing

• Existing capacity to produce

>750M glucose strips p.a.

• ISO 13485

• Highly automated

• Custom designed

• Scale appropriate

Page 10: Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

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[Insert

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logo] Contents

• UBI Overview

• Blood Glucose Monitoring

• Coagulation Testing

• Future Opportunities

Page 11: Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

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1st Qtr

2nd Qtr

1st target: the $9B blood glucose segment

Blood Glucose

Testing ~$9B Market

~5% Growth pa

Other

Point-Of-Care

Testing ~$6B Market

~10% Growth p.a.

Blood Glucose Growth Drivers

• Increased life expectancy of

diabetes sufferers

• Growing incidence of diabetes

in all geographies

• Technology improvements

• Increasing patient awareness

Source: Espicom, POC Diagnostics – 2011; Management Estimates; Global Data SMBG Market Study - Nov 2009; National Diabetes

Information Clearing House - 2011

Diabetes in the US:

• Type II prevalence doubled in US from 1990 to 2005;

• ~8.3% of US population affected;

• ~7 million people in US undiagnosed today;

• Economic burden of diabetes in US ~$245Bn per annum (up 41% in 5 years)

Global Point of Care Diagnostics Market (2013 estimate)

Page 12: Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

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[Insert

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logo] Growth in diabetes drives glucose testing

Source: Centre for Disease Control & Prevention - National Diabetes Surveillance System

0

5

10

15

20

25

1958 1968 1978 1988 1998 2008

25M US Population with Diagnosed Diabetes

(1958-2010)

Page 13: Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

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[Insert

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logo] The “Big 4” blood glucose players dominate

Bayer

US$7.6Bn

Roche

LifeScan

Abbott

Market

Share

84%

15%

15%

27%

28%

Blood Glucose Monitoring

Revenues (2012 Estimates)

Source: Company Financial Reports, analyst estimates, management estimates

Estimated

World Market

~17Bn tests / annum

Estimated

LifeScan Share

~4.5Bn tests / annum

Page 14: Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

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[Insert

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logo] OneTouch Verio global roll-out continues…

+ =

Note: images on this page are not representative of actual products approved in all markets.

*Product launched in Japan is aimed at Healthcare Professionals, rather than Self Monitored Blood Glucose

Self Monitored Blood Glucose Market (2015 estimate*)

Japan*

Australia

Spain 4 /2011

Italy 2/2011

UK 4/2011

Germany 4/2011

China India

Canada 10/2011

France 2/2011

USA 1/2012

South America Other Europe

OneTouch

Verio

Launched (Date Announced)

Source: Global Data, SMBG Market Study Nov 2009

Page 15: Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

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[Insert

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logo] …demonstrating substantial commitment

Expanding range of

OneTouch Verio Meters Expanding strip

manufacturing capacity

Page 16: Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

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[Insert

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logo] Fees from strip sales have grown rapidly

Quarterly Service Fees* (AUD’000) (2010-2013)

(AU

D’0

00

)

*Quarterly Service Fees are based on the number of Verio strips sold by LifeScan

Source: UBI accounts - for important details relating to the terms of our commercial relationship with LifeScan, refer to our most recent Form

10K and agreements filed with the SEC.

US Launch of OneTouch

Verio & associated

pipeline filling

3 5 11 55

98 77

142 172

661

354

555

666

840

760

833

972

0

200

400

600

800

1000

1200

UBI is paid ~US1cent for each OneTouch Verio strip sold by LifeScan. These Quarterly

Service Fees (QSFs) grew by ~52% in 2013, substantially faster than the overall market.

Page 17: Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

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[Insert

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logo] Contents

• UBI Overview

• Blood Glucose Monitoring

• Coagulation Testing

• Future Opportunities

Page 18: Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

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Point - Of - Care Diagnostics Market (USD) (Excluding Glucose testing - 2012E)

Fertility

$1205M

Next opportunity: POC coagulation testing

PT/INR

Testing

Other

Tests

Coagulation

$1040M

Other

$500M

Cardiac

Markers

$995M

Infectious

Disease

$920M

Clinical

Chemistry

$1015M

Urinalysis

$220M

Cancer

$280M

Source: Espicom Business Intelligence, 2011; Industry analysis; Management estimates

Page 19: Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

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[Insert

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logo] What is a PT/INR test?

• Prothrombin Time (PT) measures the

clotting tendency of blood and is reported

as an International Normalised Ratio (INR)

• Frequent INR testing is used to ensure that

Warfarin patients remain in the Target

Therapeutic Range (TTR)

• More frequent monitoring

improving patient outcomes

as patients remain within

TTR longer

• Point of Care (POC) testing

is required for more

frequent monitoring

Reduction in events

with self-monitoring

Heneghan C, Alonso-Coello P, Garcia-Alamino JM, et al. Self-monitoring of oral

anticoagulation: a systematic review and meta-analysis. Lancet. 2006;367:404-411.

Page 20: Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

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[Insert

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Source: Management estimates; Kalorama, The Worldwide Market for In Vitro Diagnostic Tests, 6th Ed., 2008; Trimark, “Point of Care Diagnostic

Testing World Markets”, April 2011

Market growth driven by:

growing patient population

ongoing Warfarin use (>7 million users in 2010)

health benefits of increasing testing frequency (towards weekly)

US Medicare reimbursement of weekly test at ~US$5.53 / test

0

200

600

800

1000

1200

1400

$1600M

400

Global POC PT/INR Market Projection (US$M)

Patient Self Test

Clinic /

Physician’s Office /

Pharmacy, etc

Hospital

POC PT-INR testing will grow strongly

Page 21: Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

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[Insert

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logo] Partnered with Siemens in POC coagulation

+

• Worldwide partnership in

“professional” markets for Point-of-

Care Coagulation testing

• UBI will be the exclusive

manufacturer of 3 coagulation test

strips for Siemens

• Siemens to register, market and

distribute products worldwide

• Siemens contributes to development

costs: ~US$8.5M received to date,

with 4 milestone payments to come

• UBI returns via margin on strip

manufacturing & upside profit share

PT-INR testing system:

- in development

- launch expected in 2014

Coagulation test #2:

- feasibility achieved June 2012

- launch expected in 2015

Coagulation test #3:

- feasibility achieved July 2012

- launch expected in 2015

Page 22: Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

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[Insert

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logo] Siemens POC coagulation: PT-INR

• Target timetable:

launch of Siemens POC PT-INR testing system is expected in 2014

revised strategy targets launch before end of Q3 2014

Siemens & UBI focused on achieving earliest possible launch

• Siemens demonstrating high commitment to launch:

high involvement in an integrated project team

driving a high quality, competitive specification

• Jointly working to:

obtain sufficient high-INR clinic data to complete

system performance validation

address residual risks and improvement opportunities

manage the logistics of launch preparations

• After completion of clinical trials, product approvals be based on:

self-certification for CE Mark and European launch

FDA 510K process prior to US market launch

Page 23: Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

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[Insert

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logo] UBI-owned home PT-INR test to follow

Illustrative purposes only

Opportunity:

UBI-owned PT-INR testing system for decentralised settings including patient

self-testing (PST), sold through specialist distributors in key markets

$200-300M market opportunity today, with potential for double-digit growth

Opportunity for higher margin business under UBI control

Distribution network provides channel for future UBI products

Target timetable:

Targeting launch in 2015

Project status:

2nd generation prototype system nearing completion

Distributor engagement accelerating

Lead candidates identified in key markets

Detailed MOUs being finalised for initial markets

3rd party meter manufacturing establishment underway

Page 24: Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

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[Insert

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logo] PT/INR offers good economic potential

Annual UBI Revenue

Opportunity (USD) Transfer Price per Strip (USD)

Market Share $0.50 $1.00 $1.50

10% $10M $21M $32M

20% $21M $42M $63M

30% $32M $63M $95M

Annual revenue opportunity: • Consider a target audience of ~7 million Warfarin patients worldwide

• Assume, conservatively, that each patient tests 30 times per annum, on average

• Assume, conservatively, that UBI’s price per test strip lies between US$0.50-1.50

Note: this analysis is intended to illustrate the scale of the opportunity within PT/INR testing across a range of input assumptions

and in no way represents a forecast of likely UBI earnings.

Page 25: Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

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[Insert

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logo] Contents

• UBI Overview

• Blood Glucose Monitoring

• Coagulation Testing

• Future Opportunities

Page 26: Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

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[Insert

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logo] A pipeline of future POCD products

Concept Feasibility Development

Molecular

Diagnostics

Platform

Immunoassay

Platform

(CRP & D-Dimer)

In Market

Glucose Test

(LifeScan)

PT-INR Test

(Siemens)

Coagulation Test

(Siemens)

Coagulation Test

(Siemens)

Other

Enzymatic

Tests

Other

Immunoassay

Tests PST PT-INR Test

How could this

work?

Can we create a

competitive product?

Create the product

ready for market

Launch and

support

Page 27: Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

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[Insert

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logo] Building a powerful diagnostics company

POC Diagnostics

Leadership Coagulation Blood Glucose

Core technology

platform (strip &

meter)

Low-cost, scale

manufacturing

Early cash flow Contract R&D

Strip production

Quarterly Service Fees

Validation by a

world leader

Demonstrated

broader capability of

UBI technology

Diversification

reduces business

risk

Long term strip

manufacturing

secured by contract

Second validation

by a world leader

• Build out POC

Diagnostics test menu

• Leverage core

capabilities

(development &

manufacturing)

• Leverage & expand

route-to-market

partnerships

• Extract greater

returns from the

value chain

Page 28: Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

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[Insert

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logo] Value Drivers

• Ongoing growth in Quarterly Service Fees (quarterly filings)

• Siemens POC PT-INR test Commercial production

Regulatory approvals

Launch (2014)

• Other Siemens POC coagulation tests Commercial production

Regulatory approvals

Launch (2015)

• UBI-owned PT-INR test for patient self-test & decentralised settings Distribution agreements

Commercial production

Regulatory approvals

Launch (2015)

Page 29: Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

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[Insert

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logo] UBI investment case

Targeting the attractive Point-of-Care diagnostics (POCD) market

With a powerful POCD technology platform

Profitable business with world leader LifeScan (J&J) in diabetes care

Partnered with world leader Siemens in POC coagulation testing

Pipeline of high value future product opportunities

Experienced, high-calibre management team

Generating revenues from worldwide sales

ASX-listed, SEC compliant, US Company

Page 30: Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

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Appendix: Financial Statements

Page 31: Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

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[Insert

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logo] Financial metrics (FY2013)

12 months ended

December 31st

2013

(A$’M)

2012 (A$’M)

Change Comments

Quarterly Service Fees 3.4 2.2 Up 52% Ongoing market penetration

Revenue from Products 10.2 19.4 Down 47% Transfer of glucose strip manufacturing to

LifeScan’s own facility in 2013

Revenue from Services* 1.5 8.0 Down 81% No milestone payments or major contract

R&D in 2013

Total Revenue 15.1 29.6 Down 49%

Cost of Goods Sold & Services 11.6 18.7 Down 38%

Contribution from

Products & Services 3.4 11.0 Down 69%

R&D Expense (net) 9.2 13.5 Down 32% 4 products in development stage, offset by

~$6M in R&D Tax Rebates in 2013

G&A Expense 6.2 6.8 Down 9% Spending restricted on non-core activities

Financing costs 0.8 0 Up $0.8k Related to structured financing

Net Loss after Tax 11.6 9.1 Up $2.5M

Net Increase in Cash 0.1 8.6 Down $8.5M Cash burn offset by additional funding

received in Dec 2013

*Excludes Quarterly Service Fees shown separately

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[Insert

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logo] Financial summary: balance sheet

UPDATE - SB

Balance Sheet as at 31 December 2013

A$

Currrent Assets (excluding cash) 12,047,157

Cash 23,742,422

Property, Plant & Equipment (net) 15,910,120

Other Non-Current Assets 2,920,000

Total Assets 54,619,699

Current Liabilities 5,422,287

Non-Current Liabilities 19,513,472

Stockholders' Equity 29,683,940

Total Liabilities & Stockholders' Equity 54,619,699

Page 33: Universal Biosensors, Inc. · February / March 2014 Universal Biosensors, Inc. ARBN 121 559 993 . 2 [Insert FSCo ... Global In-Vitro Diagnostics Market (2012 estimate) Point of Care

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[Insert

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logo] Financial summary: capital structure

Number of shares on issue 175,600,605

Market capitalization (at 20th February 2013) A$70 million

Number of options on issue 10.6 million

Cash (at 31st December 2013) A$23.7 million

Equity raised since inception A$83.7 million

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[Insert

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logo] Top 5 UBI shareholders

31st December 2013

Holding

National Nominees Ltd 10.6%

Talu Ventures Pty Ltd 10.1%

The Principals Cornerstone Fund Pty Ltd 9.9%

Australian Executor Trustees SA Ltd 8.0%

RBC Investor Services 5.3%

Shareholder

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[Insert

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ASX Spotlight Series

New York & London

February / March 2014

Universal Biosensors, Inc. ARBN 121 559 993