Click to edit Master title style. Annual and Special Meeting Of Shareholders. May 11, nuvopharmaceuticals.com TSX: NRI Nuvo Pharmaceuticals Inc.

Transcription

1 Click to edit Master title style Annual and Special Meeting Of Shareholders May 11, 2017 nuvopharmaceuticals.com Nuvo Pharmaceuticals Inc.

2 Click to edit Master title style Dan Chicoine Chairman

3 Click Agenda to edit Master title style Call to Order Business Matters: Notice of Meeting and Quorum Presentation of 2016 Financial Statements Nomination and Election of Directors Appointment of Auditors Approval of Share Incentive Plan Other Business Management Presentations Voting Results Termination of Formal Business Q&A 3

4 Click to edit Master title style Formal Business 4

5 Nomination of the Click to edit Master title style Directors of the Corporation The following persons are nominated for election as Directors of the Corporation: Daniel Chicoine David Copeland Anthony Dobranowski Robert Harris John London Jacques Messier 5

6 Click Resolution to edit Master Electing title Directors style RESOLVED that Daniel Chicoine, David Copeland, Anthony Dobranowski, Robert Harris, John London and Jacques Messier are nominated as directors of the Corporation to hold office until the next annual meeting of shareholders, until their successors are duly elected or appointed or they otherwise cease to hold office. 6

7 Click Resolution to edit Master Auditors title style RESOLVED that Ernst & Young LLP, Chartered Accountants, be reappointed as the Auditors of the Corporation, to hold office until the next Annual Meeting of Shareholders or until a successor is appointed and that the Directors be authorized to fix their remuneration. 7

8 Click Resolution to edit Master Share Incentive title style Plan RESOLVED that the that the resolution set forth on page A-1 as Schedule A of the management information circular, relating to the approval of the Corporation s Third Amended and Restated Share Incentive Plan and approving all unallocated options and unallocated common shares issuable thereunder, be passed. 8

9 Click Other to Business edit Master title style 9

10 Click to edit Master title style Management Presentations

11 Click to edit Master title style John London Chief Executive Officer 11

12 Click Safe Harbour to edit Master title style Certain information to be discussed during this corporate update contains forward-looking statements within the meaning of applicable securities laws including, among others, statements concerning the Company s 2017 objectives, the Company s strategies to achieve those objectives, as well as statements with respect to Management s beliefs, plans, estimates, and intentions, and similar statements concerning anticipated future events, results, circumstances, performance or expectations that are not historical facts. Such forward-looking statements reflect Management s current beliefs as of the date hereof and are based on information currently available to Management. These statements are not guarantees of future performance and are based on the Company s estimates and assumptions and are subject to risks and uncertainties, including those described in the Company s Management Discussion and Analysis regarding the 2016 annual audited financial statements and news releases, which could cause the Company s actual results to differ materially from the forward-looking statements to be discussed during this presentation. Although the forward-looking information discussed during this presentation is based upon what Management believes are reasonable assumptions, there can be no assurance that actual results will be consistent with these forward-looking statements. Except as required by applicable law, the Company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. 12

13 Click Non-IFRS to edit Measures Master title style EBITDA is a non-ifrs financial measure. The term EBITDA does not have any standardized meaning under IFRS and therefore may not be comparable to similar measures presented by other companies. The Company defines Adjusted EBITDA as net income from continuing operations before net interest income, plus taxes, depreciation, amortization and stock based compensation. Management believes Adjusted EBITDA is a useful supplemental measure from which to determine the Company s ability to generate cash available for working capital, capital expenditures and income taxes. 13

14 Click to edit Master title style Nuvo Pharmaceuticals 14

15 Nuvo Pharmaceuticals Click to edit Master title style Highlights Growing revenue and EBITDA healthcare company 3 commercial products: Pennsaid 2%, Pennsaid, HLT Patch Cash flow positive and profitable 2016 revenue grew 32% over 2015 Strong barriers to entry: long-life IP and long-term contracts FDA licensed manufacturing facility located in Québec Future revenue growth from Pennsaid 2% out-licensing in major markets (i.e. Europe, Latin America, Asia) M&A plan to acquire accretive products and businesses Strong balance sheet with $18.6 million of cash and short-term investments and no debt (March 31, 2017) 15

16 Pennsaid 2% Click to edit Master title style FDA Approved and Selling in the U.S. Topical and Transdermal Drug Delivery Market 27M U.S. patients with osteoarthritis Targeting U.S. NSAID market Follow-on product to Pennsaid, contains 2% diclofenac sodium Indication Benefits U.S. Commercial Status Intellectual Property Treating the pain of osteoarthritis of the knee Low systemic exposure to minimize side effects Only twice per day dosed topical NSAID in U.S. Metered dose dispenser U.S. rights sold to Horizon Pharma in October 2014 for US$45 million Nuvo is Horizon s exclusive long-term manufacturer to 2029 Multiple patents listed in the FDA Orange Book continuing to generics have settled with Horizon for a 2029 entry date No settlements yet with Lupin and Actavis 16

17 Commercial Partners Sell Our Approved Click to edit Master title style Products Pennsaid / Pennsaid 2% HLT Patch 17

18 Pennsaid 2% U.S. Average Total Bottles Click to edit Master title style Dispensed Weekly Per Period Average Total Bottles/Week 11,000 10,000 9,000 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 0 Horizon launch January 1, 2015 Source: IMS Health

19 Pennsaid 2% U.S. Average Total Bottles Click to edit Master title style Dispensed Weekly Per Month Average Total Bottles/Week 11,000 10,000 9,000 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 0 Horizon launch January 1, 2015 Source: IMS Health

20 Click to edit Master title style Mary-Jane Burkett Vice President & Chief Financial Officer 20

21 Click to edit Master title style 2016 and Q Financial Review

22 Click Total to Revenue edit Master title style $ millions $30.0 $27.0 $25.0 $20.0 $20.5 $15.0 $10.0 $5.0 $7.8 $7.0 $ Q Q Product Sales Royalties Contract revenue 22

23 Click Gross to Margin edit Master on Product title style Sales $ millions $16.0 $14.0 $13.5 $12.0 $10.0 $8.8 $8.0 $6.0 $4.0 $2.0 47% 54% $4.2 $3.9 57% 58% $ Q Q Gross Margin on Product Sales 23

24 Click Total to Operating edit Master Expenses title style $ millions $25.0 $20.0 $19.3 $15.0 $13.2 $10.0 $5.0 $5.4 $4.7 $ Q Q Total Operating Expenses 24

25 Click Net Income to edit from Master Continuing title styleoperations $ millions $9.0 $8.0 $7.0 $6.0 $5.0 $4.0 $3.0 $2.0 $1.0 $0.0 $8.3 $7.4 $1.9 $ Q Q Net Income from Continuing Operations 25

26 Click Adjusted to edit EBITDA Master title style $ millions $10.0 $9.0 $8.0 $7.0 $6.0 $5.0 $4.0 $3.0 $2.0 $1.0 $0.0 $8.9 $8.0 $3.0 $ Q Q EBITDA SBC 26

27 Click Total to Cash edit and Master Short-term title style Investments $ millions $60.0 $50.0 $48.7 $40.0 $30.0 $20.0 $17.6 $14.0 $18.6 $10.0 $ Q Q Cash and Short-term investments Cash transferred to Crescita 27

28 Click to edit Master title style Jesse Ledger President 28

29 Click to edit Master title style Business Development Review 29

30 Nuvo Pharmaceuticals Strategy to Increase Click to edit Master title style and Diversify Revenue Streams Most of Nuvo s revenue is being generated by Pennsaid 2% in the U.S. Create a global Pennsaid 2% franchise by out-licensing to strong commercial partners throughout the world Acquire complementary strategic assets through M&A to increase sales and profitability 30

31 Pennsaid 2% Click to edit Master title style International Out-Licensing Opportunities Indication Acute pain for sprains and strains Available for out-licensing Licensed, not yet launched Launched 2014 Status Many jurisdictions will base approval on existing U.S. FDA approval Phase 3 trial to support E.U., Canada and Australia approvals commenced November

32 Click $1.5B to Global edit Master Topical title Diclofenac style Market (USD in 2015) Asia (incl. Australia), $130,000,000 Middle East North Africa, $51,000,000 South America, $100,000,000 Europe, $550,000,000 North America, $635,000,000 32

33 Click Target to Licensing edit Master Agreement title stylestructure Modest upfront payments on signing/regulatory approval Royalties based on net sales in the territory and/or transfer pricing Exclusive long-term manufacturing agreement Licensee responsibility for obtaining and maintaining regulatory approval utilizing drug dossier provided by Nuvo 33

34 Click Upcoming to edit Pennsaid Master title 2% style Potential Milestones Q2 Q Q Q2 Q /2019 International licensing transactions completed and announced Announce results for German Phase 3 trial for ankle sprains Product acquisitions(s) completed and announced Regulatory approvals obtained and revenues commence from international licensing and product acquisition transactions 34

35 Click to edit Master title style Manufacturing 35

36 Click Manufacturing to edit Master title style Facility in Varennes Québec is FDA, Health Canada and MHRA approved Manufactures Pennsaid, Pennsaid 2% and HLT Patch bulk for the global market 26,000 square foot facility with 3 production lines, 2 compounding rooms Specialized expertise in semi-solids and non-sterile liquids Fully integrated pharmaceutical manufacturer with in-house capabilities including: Quality Assurance Quality Control (Including a Microbiology Laboratory) Logistics & Purchasing Experienced management team with an average of 20 years of pharmaceutical manufacturing industry experience Capacity utilization of commercial bottles is approximately 35%* 36 *have ability to add a second shift when required

37 Click Manufacturing to edit Master title style Manufacturing Lines Compounding Unit Dose Manufacturing 37

38 Nuvo Pharmaceuticals Click to edit Master title style Highlights Growing revenue and EBITDA healthcare company 3 commercial products: Pennsaid 2%, Pennsaid, HLT Patch Cash flow positive and profitable 2016 revenue grew 32% over 2015 Strong barriers to entry: long-life IP and long-term contracts FDA licensed manufacturing facility located in Québec Future revenue growth from Pennsaid 2% out-licensing in major markets (i.e. Europe, Latin America, Asia) M&A plan to acquire accretive products and businesses Strong balance sheet with $18.6 million of cash and short-term investments and no debt (March 31, 2017) 38

39 Click to edit Master title style Proxy Vote Count 39

40 Click Proxy to Vote edit Count Master Election title styleof Directors Elect Directors For % Withheld % Daniel Chicoine David Copeland Anthony Dobranowski Robert Harris John London Jacques Messier

41 Click Proxy to Vote edit Count Master Appointment title style of Auditors For % Withheld % Appointment of Auditors

42 Proxy Vote Count Click Approval to edit of Third Master Amended title style and Restated Share Incentive Plan For % Against % Approval of Third Amended and Restated Share Incentive Plan

43 Click Resolution to edit Master Terminate title the style Meeting RESOLVED that the Annual Meeting of Shareholders for 2017 terminate. 43

44 Click to edit Master title style Q&A