Changing the Cataract Surgery Paradigm - Always Surgeon Centric August 2021
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
Changing the Cataract Surgery Paradigm
Always Surgeon Centric
August 2021
Disclaimer
This presentation includes estimates regarding market and industry data. Unless otherwise indicated, information concerning the industry and the markets in which LENSAR, Inc. (the
“Company,” “we,” “our” or “us”) operates, including management’s general expectations, market position, market opportunity and market size, are based on management’s knowledge and
experience in the markets in which the Company operates, together with currently available information obtained from various sources, including publicly available information, industry reports
and publications, surveys, customers, trade and business organizations and other contacts in the markets in which the Company operates. Certain information is based on management
estimates, which have been derived from third-party sources, as well as data from internal research, and are based on certain assumptions that management believes to be reasonable.
We have made statements in this presentation that are forward-looking statements. In some cases, you can identify these statements by forward-looking words such as “may,” “might,” “will,”
“should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential” or “continue,” the negative of these terms and other comparable terminology. These forward-looking
statements, which are subject to risks, uncertainties and assumptions about us, may include, including with respect to future financial and operating objectives, anticipated trends for our
industry, market size and costs associated with being a standalone public company. Any estimates and forward-looking statements contained in this presentation speak only as of the date of
this presentation and are only predictions based on our current expectations and projections about future events. There are important factors that could cause our actual results, level of
activity, performance or achievements to differ materially from the results, level of activity, performance or achievements expressed or implied by the forward-looking statements. For a
discussion of such factors, please refer to the Annual Report on Form 10-K we have filed with the Securities and Exchange Commission.
The forward-looking statements made in this presentation relate only to events as of the date on which the statements are made. Although we believe the expectations reflected in the forward-
looking statements are reasonable, we cannot guarantee future results, level of activity, performance or achievements. Moreover, neither we nor any other person assumes responsibility for the
accuracy and completeness of any of these forward-looking statements. We are under no duty to update any of these forward-looking statements after the date of this presentation to conform
our prior statements to actual results or revised expectations.
EBITDA is defined as net loss before interest expense, income tax expense, interest income, depreciation and amortization expenses. EBITDA is a non-GAAP financial measure. EBITDA is
included in this presentation because we believe that EBITDA provides meaningful supplemental information for investors regarding the performance of our business and facilitates a
meaningful evaluation of actual results on a comparable basis with historical results. Adjusted EBITDA is also a non-GAAP financial measure. We believe Adjusted EBITDA, which excludes
stock-based compensation expense, provides meaningful supplemental information for investors when evaluating our results and comparing us to peer companies as stock-based
compensation expense is a significant non-cash charge due to the recapitalization of the Company. We use these non-GAAP financial measures in order to have comparable financial results to
analyze changes in our underlying business from quarter to quarter. However, there are a number of limitations related to the use of non-GAAP measures and their nearest GAAP equivalents.
For example, other companies may calculate non-GAAP measures differently, or may use other measures to calculate their financial performance and, therefore, any non-GAAP measures we
use may not be directly comparable to similarly titled measures of other companies.
2
Investment Highlights
Leading Femtosecond Laser (FLS) Innovator in
Growing Cataract Surgery Market
•Proprietary, best-in-class
Aggressive Company, laser system
Disruptive Technologies growing share in current market
• Next-generation system, ALLY, represents revolutionary offering addressing unmet needs of surgeons and
patients
• Large Market Opportunity; Favorable Demographic, 29M+ Procedures
• Cataract surgery is the most common ophthalmic procedure performed in older adults
• Significant Unmet Need
• 70 – 90% of patients present with astigmatism that goes largely untreated and requires glasses after
surgery
• Positioned for Significant Growth with ALLY Launch in 2022
Market Conditions and Revolutionary Technology Provide Significant Growth Opportunity
3
Cataract Surgery
Most Common Eye Surgery in Older Adults
Cataracts are a natural condition that affect nearly everyone by age 80
Source: https://www.medscape.com/viewarticle/579850
4
Cataract Surgery: Covered & Non-Covered
Covered Cataract Surgery Non-Covered Services
Manual removal of the cataract Femtosecond laser-assisted cataract surgery (FLACS)
Basic lens implantation Premium lens implantation or astigmatism treatment
Glasses needed after surgery Limited/no glasses needed after surgery
5
Continued Reduction in Surgeon Fees
Drives Growth in Non-Covered Services
U.S. CMS Cuts for Cataract Surgery Surgeon Fees
$900
$800 7.6% Cut
$700
$813
$600
$766 16% Cut
$751
$500 $654
$400 $557
$548
$300
$200
$100
$-
CPT code 66982 (Complicated) CPT code 66984 (Non-Complicated)
2019 2020 2021
6
Astigmatism
The Unmet Need in Non-Covered Services
Prevalence of Astigmatism Prior to Cataract Surgery
70-90% of patients have treatable astigmatism*
19.1%
1500
1350
14.8% N=6,000
17.1%
1200 Warren E. Hill, MD
Number of Patients
Keratometry Database
1050
12.0% Prevalence of Corneal
900
Astigmatism Prior to
750 11.2% Cataract Surgery
7.8%
600
450
5.5%
3.7%
300 2.9%
1.4% 1.3% 2.2%
150 0.9%
0
Over 4 Million Cataract Surgeries Forecasted in 2021 in the
0
5
0
5
0
5
0
5
0
5
0
5
0
.5
.7
.0
.2
.5
.7
.0
.2
.5
.7
.0
.2
.0
U.S.
-0
-0
-1
-1
-1
-1
-2
-2
-2
-2
-3
3
25
50
75
00
25
50
75
00
25
50
75
0.
0.
0.
1.
1.
1.
1.
2.
2.
2.
2.
Diopters of Cylinder
* Dr. Warren Hill. Assumes mid-range distribution of pre-op corneal astigmatism. Excludes irregular and other conditions that impact toric selection.
7
Cataract Surgery
Highest Volume Surgical Procedure Worldwide
29 Million cataract/refractive lens exchange surgical procedures globally in 2019
Cataract Procedure Breakdown
1 Million FLACS
procedure forecasted in ECCE/Covered
cataract/refractive lens
exchange surgery 34%
2024
$434 Million* total 63%
FLACS revenue 3% FLACS/Non-Covered
forecasted (~815,000 Procedures)
Ultrasonic
* includes FLACS lasers, user/pack fees, Phacoemulsification
maintenance, accessories/upgrades
(USP)/Covered
2019 Cataract Surgical Equipment Market Report: A Global Analysis for 2018 – 2024, Market Scope LLC
2020 IOL Market Report: A Global Analysis for 2019 – 2025, Market Scope LLC
8
Why Femtosecond Laser Assisted Surgery with LENSAR®
FLACS: A Historical Overview
1st Generation Competitive
‘10 Femto Lasers ‘12 Femto Lasers ‘21 LENSAR Launched ‘22 LENSAR Will Launch ALLY™
Cataract System
6 Upgrades
9Innovation & Differentiation
Driving LENSAR Market Share Gains
LENSAR Procedures per Year 1H 2020 Revenue Market Share
of FLACS Participants(1)
120,000 %
: 18 108,030
% GR
: 29 ‘20 CA 97,071
100,000 R
C AG 6 –
19 ‘1
–‘ 81,085
80,000
‘15
63,175
60,000
49,769
38,528
40,000
20,000
0
2015 2016 2017 2018 2019 2020
Source: Market Scope, LLC. (2020, July). 2020 Cataract Surgical Equipment Market Report.
10Procedure volume grew 30% YOY since 2016
LENSAR®’s Utilization Significantly Higher than Competitive Systems
Avg. Procedures LENSAR Avg. Comparison to
per Installed Procedures per Industry , Wilson’s)*
World Region Device(1) Laser Average LENSAR installed systems
performed 79% more procedures
United States 302 610 102% than the WW average/system(1)
Western Europe 281 387 38%
Other Wealthy Nations
266 810 204%
(South Korea)
China 298 285 -4%
LENSAR delivers:
• Higher value in astigmatism
India 282 690 145% management
Rest of World (Turkey) 234 353 51% • Automated capsulorhexis centration
• Better ergonomics and throughput
Worldwide 285 510 79%
• 2019 global installed base of FLACS was ~2,900 ~2,600 are in markets that LENSAR serves
• YE2020 LENSAR total installed base of 225
• LENSAR had 97,071 procedures for 2020 and 108,030 for 2019, equivalent to ~16% and ~13% overall global procedure
market share, respectively
(1) 2019 Cataract Surgical Equipment Market Report: A Global Analysis for 2018 – 2024, Market Scope LLC
11LENSAR® Users Outperform Forecast
Why?
“According to our analysis, the
average number of procedures per
laser per year in the US in 2019 was
302, while the average number of
procedures per LENSAR laser was
more than 600 procedures.”
12LENSAR®’s Differentiation –
Better for Patients. Better for Surgeons.
ü Cataract Density ü IntelliAxis Refractive
Imaging Capsulorhexis®
ü Highly-Efficient ü Wireless Transfer of
Custom Fragmentation Pre-Op Diagnostic Data
ü Localized Corneal From Multiple Devices
Imaging
ü Iris Registration and
ü Toric IOL Power Automatic Cyclorotation
Conversions Adjustment
ü Surgically-Induced
ü Accurate Incision
Astigmatism Adjustment
Planning and
Optimization
13LENSAR®: Tools to Enable Superior Outcomes
• 88.46% of eyes treated with IntelliAxis
Refractive Capsulorhexis® were ≤0.5 D vs.
38.7% of manually marked eyes
• UCDVA was statistically better post-op in the
patients treated with IntelliAxis Refractive
Capsulorhexis® vs. manually marked eyes
Chen Q, Zhang, G Iris Registration Capsulotomy Marking Versus Manual Marking for Toric Intraocular Lens
Alignment in Cataract Surgery. American Journal of Ophthalmology (January 2021)
14LENSAR®: Tools to Enable Superior Outcomes
Postoperative Results Postoperative Results
• 98% of eyes with toric IOL • 94% of eyes that received an
treatment were ≤0.5 D EDOF toric IOL were
• 0 eyes had IOL ≤0.5 D post-op and MRSE
misalignment or was -0.14 ± 0.44 D (N=115)
adverse events • Astigmatism was reduced
from 1.55 D pre-op to 0.47 D
post-op (PThe Perfect Storm Additional Factors Supporting Growth
Why Femtosecond Laser Assisted Surgery with LENSAR®
Market Dynamics Support a ‘Perfect Storm’ for FLACS Growth
6 Broaden utilization
to every procedure
5 Lower cost
4 Next-gen devices addressing
patient flow issues
3 PE practices seeking
to maximize revenue
2 Reduced covered
services reimbursement
1 Continued introduction
of premium IOLs
Confidential 17Raising the Bar LENSAR® Next Generation ALLY™
Proprietary Imaging:
ALLY™’s Foundation for Revolutionizing Cataract Surgery
Category 1 Category 2 Category 3 Category 4 Category 5
Automatically categorizes cataract density, identifies nucleus location and lens layers
thanks to LENSAR’s proprietary imaging with Augmented Reality™
DRIVES
Optimized femto + Optimized phaco
Increases treatment efficiency while decreasing overall energy used in the eye
LENSAR: Confidential 19ALLY™ Adaptive Cataract Treatment System
Femto + Phaco
Integrated system with state-of-the-art features evolved from
the LENSAR Laser System AND Oertli Phaco System
• Replaces current femto and phaco technology to address changing environment
⎻ Designed to be placed anywhere in the OR or an in-office suite
⎻ Seamless transition from femto to phaco performed in a sterile environment
• Cost-effective
⎻ Can be used in both reimbursed and private pay market
⎻ Improved practice economics as overall cataract procedures/market opportunity grows to 33M+
⎻ ALLY System expected to cost less than current femto system
• Disruptive
⎻ First truly adaptive cataract treatment device in the market
⎻ Enables easy premium/toric IOL patient conversions
⎻ Improved efficiencies
⎻ Optimal for new premium IOL entrants
⎻ Better outcomes possible in astigmatic patients
March 2021 Geared toward improving overall safety, efficiency and outcomes LENSAR: Confidential 20ASCRS 2021
ALLY VIP Experience
Generates Excitement at ASCRS Conference
21ASCRS 2021
ALLY VIP Experience
Generates Excitement at ASCRS Conference
22ASCRS 2021
ALLY VIP Experience
Physician Social Media Confirmation
Dagny Zhu, MD Amir Marvasti, MD
“Got to demo the NEW “Got a private look at
combined femto/phaco the next generation
unit from LENSAR femto + phaco machine
coming in 2022! by LENSAR. Very
#gamechanger impressed!”
#alwaysinnovating”
23LENSAR ® Financials and Leadership
Recovery from COVID-19 in 2021
Cash use dedicated to R&D Investment in ALLY
Three Months Ended Six Months Ended
June 30, June 30,
$ in millions 2021 2020 2021 2020
Revenue $7.9 $5.0 $15.0 $11.0
% Change 57.0% (31.0)%(1) 36.6% (21.8)%(1)
Net loss ($4.4) ($4.5) ($9.5) ($8.2)
EBITDA(2) ($3.7) ($3.2) ($8.3) ($5.5)
Add: Non-cash stock-based
compensation expense 1.4 0.0 3.8 0.1
Adjusted EBITDA(2) ($2.3) ($3.2) ($4.5) ($5.4)
Memo:
R&D Expense(3) $3.0 $1.4 $5.8 $3.0
(1) Compared to revenue of $7.3 million and $14.0 million for the three and six months ended March 31, 2019, respectively.
(2) EBITDA and Adjusted EBITDA are non-GAAP measures. Please refer to the next slide for a reconciliation of EBITDA and Adjusted EBITDA to net loss.
(3) R&D expense contains $0.133 million and $0.0 million of stock-based compensation expense for the three months ended June 30, 2021, and 2020, respectively, and $0.353 million
and $0.0 million for the six months ended June 30, 2021 and 2020, respectively.
25Non-GAAP Reconciliation
Three Months Ended Six Months Ended
June 30, June 30,
$ in thousands 2021 2020 2021 2020
Net loss $ (4,362) $ (4,497) $ (9,544) $ (8,183)
Add: Interest expense - 671 - 1,275
Less: Interest income (13) (17) (31) (34)
Add: Depreciation expense 342 331 670 808
Add: Amortization expense 309 314 622 631
EBITDA (3,724) (3,198) (8,283) (5,503)
Add: Stock-based
compensation expense 1,430 41 3,750 126
Adjusted EBITDA $ (2,294) $ (3,157) $ (4,533) $ (5,377)
26Continued Momentum from 2H 2020
Six Months Ended June 30, Twelve Months Ended December 31,
$ in thousands 2021 2020 2020 2019
Revenue
Product $ 11,214 $ 8,096 $ 19,831 $ 23,254
Lease 2,251 1,446 3,601 4,181
Service 1,500 1,411 2,950 3,093
Total revenue 14,965 10,953 26,382 30,528
Recurring Revenue 90% 90% 85% 79%
Gross Margin ($ / %) $8,352 / 56% $5,514 / 50% $14,075 / 53% $13,229 / 43%
Worldwide Procedures Sold
2021 2020 2019
1Q 28,122 23,225 24,594
2Q 30,966 18,265 26,275
3Q - 25,078 25,154
4Q - 30,503 32,007
27
YTD 59,088 97,071 108,030LENSAR®’s Leadership has Deep Expertise in Cataract Surgery,
Device Development and Commercialization
Nicholas Curtis Alan Connaughton Thomas Staab
Management Chief Executive Officer Chief Operating Officer Chief Financial Officer
Board of Directors William Link, PhD
Founder & Managing Partner, Flying L Partners; Co-founder & Managing Director, Versant Ventures; General partner, Brentwood Venture
Capital, Chiron Vision Corporation, American Medical Optics, AMO
Board Member: Oyster Point Pharma, Edwards Lifesciences, Chairperson of Glaukos Corporation
Richard Lindstrom, MD
Partner, Flying L Capital; Investment Committee, Visionary Ventures
Board Member: Harrow Health, Ocular Therapeutics, TearLab, Acufocus, Foresight #6, Equinox, LensTechs, CorneaGen, Surface Inc.,
Unifeye Vision Partners, Theroptix, TearClear
Gary Winer
President & CEO, ORGENTEC Diagnostika
Principal, DRC Health Care Advisors
John McLaughlin, JD
Board Member: PDL BioPharma, Rockwell Medical
Aimee Weisner, JD
Board Member: Glaukos Corporation, Oyster Point Pharma
Elizabeth O’Farrell
Board Member: Geron Corporation, Inhibikase Therapeutics, Chairperson of PDL BioPharma
28Reasons to Believe in LENSAR®
Investment Highlights
Leading Femtosecond Cataract Lasers (FLS) Innovator in Growing Cataract Surgery Market
• Cataract surgery - +29M procedures worldwide in 2019
• Femtosecond Laser Assisted Cataract Surgery (FLACS) – 815,000 procedures in 2019;
Large Market
projected with1MSignificant
to reach in 2024 Growth Potential
⎻ FLACS market under-penetrated due to limited use of premium procedures, efficiency and patient flow
challenges
⎻ LENSAR had 13% global FLACS market share year-end 2019; increasing to 16% mid-2020 as reported by Market
Scope
• Current Generation: LENSAR Laser System with Streamline® IV -
optimal treatment of tissue-specific cataract and astigmatism
Proprietary laser Disruptive Technology
• Next generation Platforman enhanced femtosecond laser
ALLY™ – Integrates
system with best- with a phacoemulsification device in a compact, mobile cataract
treatment system; expected launch in 2022
in-class features • Visually significant astigmatism exists in 70-90% of cataract patients
growing share in –
Major
Astigmatism remains untreated in most cataract surgeries;
Unmet
– Most Need
technologies to correct astigmatism in cataract patients are sub-optimal
current market • Significant physician need for refractive cataract laser with effective
astigmatism management capability and efficient product design
• ALLY will allow more patients to experience the benefits laser cataract surgery
• ALLY may provide an optimal offering in a post-COVID operating environment
• Positioned for Growth
Sources: 2020 Cataract Surgical Equipment Market Report: A Global Analysis for 2019 –2025, Market Scope LLC
30You can also read
