Transcript COLD-FX Pediatrics - Afexa Life Sciences Inc.

POSITIONING FOR
GROWTH
TSX: FXA
Jack Moffatt
Chairman and CEO
Canaccord Genuity
Healthy Living Conference
October, 2010
Forward-Looking Statements
Sections of this presentation contain forward-looking
statements. These statements are based upon numerous
assumptions which Afexa cannot control and involve risks and
uncertainties that could cause actual results to differ. These
statements should be understood in light of the risk factors and
more detailed cautions regarding forward-looking statements
set forth in the Company's filings with the Securities Regulators
including, but not limited to, the Company's Annual Information
Form and other documents filed on System for Electronic
Disclosure and Retrieval (www.SEDAR.com). The forwardlooking information and statements contained in this
presentation speak only as at the date of this presentation and
the Company assumes no obligation to publicly update or
revise them to reflect new events or circumstances, except as
may be required pursuant to applicable laws.
Advisory Regarding Regulatory Statements
In Canada under Health Canada’s regulatory
guidelines and Afexa’s product license (NPN)
for COLD-FX®, the Company is able to make
claims about its COLD-FX clinical studies and
proven efficacy in treating colds and flu.
In the U.S market, under the FDA guidelines,
COLD-FX is classified as a
dietary
supplement for enhancing immune system
function.
Reference to clinical trials and
medical claims in this presentation relate to
the Canadian marketplace.
Afexa Overview
WHO WE ARE
Afexa Life Sciences Inc., founded in 1992, develops
and commercializes innovative, evidence-based
natural medicines. Our lead product is COLD-FX®,
Canada’s #1 selling cold and flu remedy
OUR VISION
To deliver the most trusted health brand on the planet
Afexa Life Sciences Inc.
TSX:
FXA
Shares Outstanding:
104 million
Cash Position June 30:
$8.6 million (CDN)
Annual Sales (F2009)
$47.6 million (CDN)
Market Cap:
Approx.
Employees:
120
$60 million (CDN)
Afexa’s Commercialized Products
Natural Health
Products Industry
ChemBioPrint
Proprietary Technology
Consists of two-dimensional fingerprinting
Biological Fingerprinting
• Polymolecular active constituents
are tested for multiple biological
or pharmacological responses
indicating health and/or
therapeutic benefit
Chemical Fingerprinting
• Multiple chemical analysis
combining different
chromatographic detectors
provides precise chemical
identity of multiple active
constituents of a product
Health Canada-Approved Medical
Claims for COLD-FX®
The Natural Health Products Directorate
issued a product license and natural
product number (NPN) for COLD-FX
Non-Traditional
Comprehensive Treatment Claim
“helps reduce the frequency, severity
and duration of cold and flu
symptoms by boosting the
immune system.”
Canada’s #1 Selling Brand for All
Cold and Flu Remedies & Natural Supplements
• The Nielsen Company MarketTrack National all channel service for
Cold Remedies (including Antihistamines), and Natural Supplements
for 52 week period ending July 3, 2010
COLD-FX – Clinical Trial Results
Published in Canadian Medical Association Journal *
25%
56%
31%
35%
Reduction in
average
number of
colds & flu
Reduction in
number of
recurrent
colds & flu
Reduction in
severity or
symptoms
Reduction in
symptom
duration
Healthy adults from the general population
*Oct, 2005 Vol. 173, No. 9; 1043-1048
COLD-FX – Clinical Trial Results
89%
5.6
5.6
reduction
in relative
risk of
cold & flu
55% reduction in symptom
duration in communitydwelling seniors
Days
Days
COLD
-FX®
COLD-FX®
12.6
12.6
Days
Days
Placebo
Placebo
2
4
6
8
Days
10
12
14
Results of a randomized control
trial in healthy adults
(n=43)1
1 McElhaney,
JACM 2006; 2 McElhaney, JAGS 2004
Results of randomized control
trial in institutionalized seniors
(n=198)2
Health Canada-Approved Medical
Claims for COLD-FX®
The Natural Health Products Directorate
issued a product license and natural
product number (NPN) for COLD-FX
Non-Traditional
Comprehensive Treatment Claim
“helps reduce the frequency,
severity and duration of cold and
flu symptoms by boosting the
immune system.”
Absenteeism in the Workplace
2009 Absentee Days
VS
7.8 days*
2009 national average
2.1 days**
2009 Afexa average
*Statistics Canada based on full-time employees, absentee days due to illness or disability
** COLD-FX supplied free to all employees
Growing a Market Leader
Consumer Purchases $ in Millions
$80
$70
$60
$50
Total Tylenol Cold/Flu
$40
$30
$20
$10
$0
2002
2003
2004
2005
Source: Nielsen MarketTrack, National All Channels, Calendar Years
2006
2007
2008
2009
CAGR: Compound Annual Growth Rate
Financial Summary
Revenue & EBITDA(1) growth ($CDN millions)
ADJUSTED EBITDA(1)
60
50
Millions
Millions
REVENUE
40
14
12
10
8
30
6
4
20
2
0
10
-2
-4
0
2004
(1)
(2)
2005
2006
2007
2008
2009 2010 (2)
6 months
2004
2005
2006
2007
EBITDA – Earnings before interest, income taxes, depreciation, amortization and stock based compensation
6 month period ended March 31, 2010 (new year-end)
2008
2009
2010
6 months (2)
Financial Summary
2008
2009
2010
6 month period ended
03/31/10
Sales
$49.4 Million
$47.6 Million
$34.4 Million
65%
67%
68%
Earnings
Before Tax
$7.6 Million
$2.2 Million
$4.3 Million
Cash & Near
Cash
$9.4 Million
$3.5 Million
$17.7 Million
Total Assets
$42.0 Million
$37.9 Million
$44.0 Million
Gross Margin
18
Our Vision
OUR VISION
To deliver the most trusted
health brand on the planet
Parallel Growth Drivers
Market
Diversification
Product
Diversification
Founder and CSO Dr. Jacqueline Shan
Heads a Strong Scientific Team that is Driving
Market and Product Diversification
Market and Product Diversification
Well Underway
COLD-FX® is the
Canadian market
leader for flu and colds
A proven marketing and
sales platform for
launching new products
into the Canadian
marketplace
A proven science-based
company pioneering natural
medicines that empower
people to achieve their
health potential
Positioned to focus
on opportunities
outside Canada
Profitable and able to
self-fund full cycle of
research, clinical studies,
launch and marketing of
new products
Parallel Growth Drivers
Market
Diversification
Market Diversification
1
3
2
4
Parallel Growth Drivers
Product
Diversification
Branching Out With
New Polymolecular
Botanical Drugs
26
ChemBioPrint
Proprietary Technology
Consists of two-dimensional fingerprinting
Biological Fingerprinting
• Polymolecular active constituents
are tested for multiple biological
or pharmacological responses
indicating health and/or
therapeutic benefit
Chemical Fingerprinting
• Multiple chemical analysis
combining different
chromatographic detectors
provides precise chemical
identity of multiple active
constituents of a product
Product Pipeline
Discovery
1 – 2 years
Cholesterol
Management
COLD-FX® Pediatrics
Seasonal Allergy
Cancer Support
Oxidative Stress &
Brain Health
Glucose Management
Blood Pressure
Management
PreClinical
Clinical
3 – 5 years
Approval End-Product
Launch
6 months – 2 years
COLD-FX Pediatrics
1 – 2 years
Discovery
3 – 5 years
Pre-Clinical
Clinical
6 months – 2 years
Approval End-Product Launch
• Children 3-11 years old
• First clinical trial
• Safety
• Complete and successful
• Second clinical trial planned;
randomized, double-blind,
placebo-controlled
Product Pipeline
Discovery
1 – 2 years
Cholesterol Management
COLD-FX® Pediatrics
Seasonal Allergy
Cancer Support
Oxidative Stress & Brain
Health
Glucose Management
Blood Pressure
Management
TLR Therapeutics
•Anti-Viral
•Cancer Management
•Vaccine Adjuvant
PreClinical
Clinical
3 – 5 years
Approval End-Product
Launch
6 months – 2 years
Investing in Afexa
Maturing Canadian science
company with highly accepted
commercial products with
potential to leverage proven
science across new medicines
and markets
Market and product
expansion well
underway
Laboratory and clinical
breakthroughs and
development well underway
Strong future growth
potential
Full spectrum of in-house
professionals capable of building
strongly branded products from
conceptualization to
commercialization
Board of Directors,
composed of strong
and knowledgeable
individuals from a wide
range of disciplines,
provides oversight and
guidance