Tissue Regenix Group plc

Jefferies Healthcare Conference

London, 19th November 2014

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Agenda

• Corporate

• Wound Care

• Orthopaedics

• Q&A/Close

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dCELL® Process

dCELL® Process

Patent protected

Store at room temperature

surge

ry

Surgeons usual technique

regeneration

With patients own cells –natural healing

Long term regenerative

repair

Animal or human

4

Intellectual PropertyK

no

w h

ow

Decellularisation of matrices

Aus, Can, EU, US

Meniscal Repair EU

[Can, India, Japan, US]

Aus, China

Bladder UK

[EU, Aus]

US

Ultrasonic modification

of soft tissues

EU, US

Acellular Arteries

[Aus, Br, Can, China, EU, HK, India, Japan,

US]

Granted patents in bold, all others

pending

Trademarks: Tissue Regenix, dCELL, TRx, DermaPure

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Strategy

US

• Human ‘1271’products

• Porcine dermis (general surgery)

dCELL® evidence base

• Health economics

• Clinical/mechanism of action

Core focus areas

• Wound Care

• Orthopaedics

EU

• CE Mark (porcine products)

dCELL®

6

Product Pipeline

7

MENISCUSDevelopment

ClinicalHEART VALVE

CommercialDermaPure®

TENDON

PORCINE

HUMAN

MENISCUS

TENDON DERMIS (GEN. SURGERY)

DERMIS (WOUND CARE)

Launch programme

8* Calendar years – indicative timings only dependant on development timings & regulatory considerations

2015 2016

DermaPure®(Dental) (US)

DermaPure®(Ortho) (US)

SurgiPure®(General) (US) dCELL® Meniscus (EU)

dCELL® Tendon (EU)

dCELL® Human Meniscus (US)

dCELL® Human Tendon (US)

SurgiPure®(General) (EU)

PORCINE

HUMAN

Regulatory

• Xenograft (porcine/bovine)

– EU, class III generally

– US, 510k or PMA

– ROW, varies by market

• Human

– EU, no harmonised standard

– US, ‘minimally manipulated’ tissues classed as transplants

– ROW, varies by market

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11/19/2014 Proprietary and Confidential. © 2014 Tissue Regenix 10

Proprietary and Confidential. © 2014 Tissue

11

THE U.S. WOUND AND TISSUE MARKET WAS VALUED AT OVER $7.8 BILLION IN 2013 1

Acute Wounds:

Trauma Wounds are

responsible for an estimated

2.3M admissions per year 2

Burns represent over

450,000 hospital admits

annually within the US 3

Surgical Wounds related

to surgical site infections are

responsible for an additional

1 million inpatient-days and $1.6

billion in excess costs 4

Chronic Wounds:

1. iData Research Inc., 2013

2. CDC, Trauma Statistics updated February 2014

3.. American Burn Association National Burn Repository (2013 report)

4.. American Journal of Infection Control. 2009 Jun; 37 (5): 389-397

5. Medscape, Diabetic Ulcers, July 9, 2014

Diabetic Ulcers affect 1.5 million patients 5

• 85% of all Lower Extremity Amputations

have DFU origins 6

Venous Leg Ulcers (500K – 2M annually )

• 20% of ulcers not healed within 2 years 8

• 66 % of patients had a history of ulcers lasting

longer than 5 years 8

Arterial Ulcers affect 500,000 people per

year and prevalence increases with age 7

Pressure Ulcers affect an estimated 10%

of all patients within hospitals 9

• The cost of pressure ulcer treatment is

$2.41 billion in excess healthcare 9

6. DESHPANDE AD, HARRIS-HAYES M, SCHOOTMAN M: Epidemiology of diabetes and diabetes-related complications. Phys Ther 88: 1254, 2008.

7. Journal of the American Podiatric Medical Association Vol 101 No 2 March/April 2011

8. AHRQ - Research Protocol – Mar. 5, 2012

9. Ostomy Wound Management 2009;55(11):39–45

11/19/2014 Proprietary and Confidential. © 2014 Tissue Regenix

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Growth Rate of Wound Care Products in US

2012-2020

Acute / Post Acute Share of HCTPs by Company • Incidence of wounds is growing due to diabetes,

obesity along with lifestyle changes

• Shift from conventional treatment to advanced modalities

to lower overall treatment costs

• Today bioengineered skin & skin substitutes (HCTPs)

represent only 5% of the total wound market

• Despite reductions in reimbursement, skin substitutes

represent one of the highest CAGR segments

Others

0

50,000

100,000

150,000

200,000

250,000

300,000

350,000

2013 2014 2015 2016 2017 2018 2019 2020

Pro

ce

du

res

Biologic Skin Substitute Procedures Biosynthetic Skin Substitute Procedures Synthetic Skin Substitute Procedures

Estimated Skin Substitute Procedures

2013 – 2020

2015 - Phase II Sales Strategy & Execution in Outpatient Facilities 2015 - Phase II Strategy 2014 - Phase I Strategy

Sales Targets: • Outpatient Surgery Centers

• Ambulatory Surgery Centers

• Wound Care Centers

• Physician Offices

Critical Success Factors: • Q Code Issuance - Q 4152 issued

• LCD – MAC Coverage

• Private Payer Coverage

• Physician Usage & Adoption

Sales Targets: • Hospitals

• VA Facilities

• LTACs (Long Term Acute Facilities)

Critical Success Factors: • Physician Champion Development

• Trial Usage

• Positive DermaPure Outcomes

• Hospital Approvals - Value Analysis Committees

• Sales Reach & Frequency to Key Accounts

Measure

Outcomes

Clinical Efficacy

Evidence

Clinical

Evaluation

Trial

Physician

Champions

Review

Value Analysis

Committee

Approval

Hospital / IDN

Contract

DemaPure

Demand

Formalized Process w/ Sr. Exec

Leadership & Physician alignment

5-7 months

Standardization Focus

among New Technologies

Up to 6 months

Value Analysis Process

that doesn’t align

physician & hosp. goals

Up to 1 year

No Formal Value Analysis:

Physician Preference

1 – 3 months

Inpatient Facilities Outpatient Facilities

11/19/2014 Proprietary and Confidential. © 2014 Tissue Regenix 14

91 year old male

0

33

55

0

27

46

58

0 1 2 3 4 5

% S

urf

ac

e A

rea

Red

uc

tio

n

Weeks (0 = Application)

Weekly Wound Healing

Patient 1 Patient 2

91 year old male with Charcot foot

• Full thickness wound left foot, plantar

• Wound duration 1 month

• Competitive HCT/P tried and failed prior to DermaPure.

Application Week 2Week 1

Application Week 2Week 1 Week 3

53 year female with Diabetic Foot Ulcer

• Full thickness wound left lateral foot

• Wound duration +6 months

• Competitive HCT/P tried and failed prior to DermaPure.

Patient 1:

Patient 2:

11/19/2014Proprietary and Confidential. © 2014 Tissue Regenix

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6 weeks 6 months4 months

HEALEDcompletely

RE-EPITHELIALIZATION

Mean Reductionin Surface Area

Chronic Wound Study Published - Wound Repair & Regeneration

Acute Wound Study Submitted for Publication

Study Results:

• Key differences observed in structural & biomechanical characteristics of skin substitutes:

• These influence distribution and organization of capillary networks within regenerating dermis

• DermaPure™ resulted in increased angiogenesis after wounding compared to controls

• DermaPure™ was the only tissue product observed with elevated mRNA expression of PROK2 and MT6-MMP

• DermaPure™ is a potent angiogenic stimulant & less fibrogenic than alternative substitutes during acute cutaneous wound healing

Study Aim:

• Assess the angiogenic & fibrogenic response to

wounding 50 healthy volunteers

• Compare 4 treatments options:

- Secondary intention healing (control)

- Integra matrix wound dressing (CG)

- Full thickness autograft (Autograft)

- DermaPure™ (DCD)

British Journal

of Surgery

International, Scientific,

Peer Reviewed Online

Journal

11/19/2014

Phase IV Prospective, Multi-Center, Randomized, Single-Blind, Active and Standard

Care-Controlled Study of DermaPure™ in Patients With "Hard to Heal" Chronic,

Neuropathic Diabetic Foot Ulcers With Crossover Design for Standard Care Arm

Robert Kirsner

MD, PhD

University of

Miami

David Armstrong

DPM, MD, PhD

University of Arizona

New England VA

Vickie Driver

MS, DPM

Barbara Aung

DPM

Private Practice

Robert

Frykberg

DPM

Phoenix VA

Howard

Kashefsky

DPMUniversity of North Carolina

Larry Lavery

DPMUniversity of Texas

Southwestern University

Ernest Chiu

MDNew York University

Multicenter clinical investigation; 9 wound care

centers in the US. Enrollment and patient

selection is ongoing. Each site will enroll

approximately 10 patients.

Objectives: Primary: To establish the wound healing

performance and safety of DermaPure™ over a 12 week period, when administered to “hard to heal”

chronic, neuropathic diabetic foot ulcers on up to two

occasions.

Secondary: To investigate the rate of healing,

cellular and biochemical changes compared to

baseline and quality of healing (recurrence) of hard to

heal chronic, neuropathic diabetic foot ulcers after

treatment with DermaPure™.

Crossover of Control patients at 12 weeks

EPA testing at week 0

ORTHOPAEDICS

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Global 2013 Orthopaedic Market

BMP

Growth Factors

Stem Cells

Synthetic Bone Graft

ScaffoldsAllograft Tissues

• Total Sales $45 Billions at 3.3 % over prior year – CAGR $55 Billions 2018

• $ growth in Hips, Knees and Spine slowed to low to mid single digit range

• Growth in Trauma, Extremities, Sports Med and Biologics robust

• Global Regenerative, Soft Tissue and Cartilage Repair products is expected to grow at 6.6% CAGR through 2019

• Players seek to develop alternatives to Gold Standards of auto grafts (bone and soft tissue)

• Estimated revenue 2012 $4.6 billion

• Demographics continues to serve the segment well age, arthritis, obesity, sports

• Patients will continue to demand alternatives to joint replacement –scaffolds, cell therapies etc – as they seek to extend their physically active lives and putting off major surgery as long as possible

• Significant need for soft tissue grafts/replacements within Sports Medicine arena (Meniscus, Cartilage, Ligaments)

• Orthopaedics remains one of the healthiest segments among medical devices

14%

16%

3%

14%10%

17%

1%

11%

14%

HipsKneesExtremitiesTraumaSoft Tissue/ArthroscopySpineBoneGrowth StimulationBiologicsOther

Report 2014Source: Orthoworld Report 2014, BCC Research

Global Market Drivers

Demographics

By 2050 the number of people over the age of 65 will have tripled to

1.5 billion

EconomicsReimbursement

Funding Structure Healthcare

Systems

Emerging Markets

Technology Innovation

Evidence Platform

LifestylesActivity Levels Quality of Life

DiseaseOsteoarthritis

Obesity Diabetes

Age Group Population(MM) 2005

Population (MM) 2020

Average Annual Growth

<20 2,410 2,513 0.3%

20-39 2,033 2,286 0.8%

40-64 1,536 2,085 2.4%

65+ 473 724 3.5%

Total World Population

6,451 7,608 1.2%

Source: U.S. Bureau of the Census

Orthopaedic strategy

Porcine DevelopmentsFocus on CE Marks and EMEA CommercialisationMeniscus and ACL Scaffold

Clinical and ‘Economic’ Proof KOL’s, Clinical Studies, Agencies, Consultancies

Human Tissue DevelopmentsFocus on USA market model and CommercialisationMeniscus and ACL Scaffold

Innovation that is commercially viable

and aligned to market requirements

addressing clinical need

Orthopaedic -go to market strategyEU• Launch criteria

– Third Party Distribution model– Focused country launch– Select markets with clear

reimbursement pathways– Targeted KOL’s

• Post Market Support– Post Market Surveillance– Registries– High end case studies at

recognised centres

• Product development– Broaden portfolio through line

extensions

US• Launch criteria

1) human dCELL® tendon 2) human dCELL® meniscus

– Hybrid (direct/distributor) model

– Reimbursement strategy– Targeted KOL’s

• Sports medicine

• Post Market Support– Case studies at key centres

• Product development– Increase donor supply

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Meniscal Repair Market Responding to clinical needs

Large Global Market Opportunity• Partial Meniscectomy most common Orthopaedic Procedure at 61 per 100,000

population• 2013 – USA 1 Million, Europe 400,000 Meniscal Procedures

Current Therapies/Treatments• For every 100,000 Meniscal injuries approx 20% are repairable. • Remaining 80% - Partial Meniscectomy is the treatment of choice and regarded as

sub-optimal.• 20-25% of patients remain symptomatic and require ongoing treatments and surgical

interventions.• Competitive landscape – Other scaffolds -Orteq, Ivy Sports Medicine, Azellon,

Orthox

Primary goal with dCELL® Meniscus• In the short term – restore load bearing and shock absorbing functions, contributing

to pain relief and restoring functional mobility.• In the long term to lower the risk of OA and the need for further operations. e.g. PKR

and TKR

dCELL® Meniscus Background

• Meniscus structure is complex and poor to heal beyond the outermost 20%

• Irreparable meniscus tear

• Partial Menisectomy

• dCELL® Meniscus Replacement

dCELL® Meniscus Milestones

• Preclinical safety study completed (2013)

• VOC feedback (2013)

• Cadaver development workshops with 3 leading UK KOL surgeons (2013 and 2014)

• Clinical Trial Centres approved – Ethics Committees, Competent Authorities, SIVs (2014)

• Investigator Surgeon Training (2014)

• Clinical trial start targeted for Q4 2014

dCELL® Porcine Meniscus Clinical Trial

Design: Prospective, open label, single-arm multi-center study

Primary Objective:To assess the safety and performance of dCELL® Meniscus in improving pain

Secondary Objective:To assess subject’s knee functional improvement following implantation

Indications:

Treatment of chronic pain following failed previous meniscus repair or partial Meniscectomy

60 patients to be implanted with dCELL® Meniscus

Expected enrollment period 6 months

24 months Follow-up:7-14 days1 month3 months6 months12 months24 months

Primary efficacy variable:

Pain relief as assessed by change in VAS pain score from baseline

Secondary efficacy variables:

Integration success over time IKDC score change over time Lysholm score change over time KOOS score change over time Ease of use

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ACL Reconstruction Market Responding to clinical needs

Large Global Market Opportunity

• ACL rupture is the second most common injury of the knee requiring surgical reconstruction

• Approximately 80% of ACL injuries are surgically treated

• An estimated 900,000 procedures performed annually growing at 7% CAGR (2012-2020)

Current Therapies/Treatments

• Autograft – 73%

• Allograft – 26%

• Synthetics – 1% LARS, Neoligaments, Soft Tissue Regeneration

• Xenograft Scaffolds – Aperion Biologics

Primary goal with dCELL® ACL Scaffold

• Restore ‘normal joint’ mechanics

• Functions as a dynamic implant for host cell repopulation and ultimate ligamentization

dCELL® ACL Scaffold -Updates

• Preclinical safety study initiated January 2014

• VOC feedback positive on key product features

• Final Report on Pre-Clinical due Dec 2014

• Clinical Trial Centres identified

• Clinical submission Q1 2015

• Clinical trial start targeted for Q3 2015

Financials

• Cash at 31/7/14– £14.5m

• Operating loss (6m to 31/7/14)– £3.8m

• Expenditure on US subsidiary costs in line with expectations

• Two porcine product development programmes entering clinical phase (meniscus/tendon)

• Capex remains low– Leeds site upgrade costs

• Current funding raised in 2012 for porcine developments– CE mark not PMA

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Newsflow

2015

• Commercial*

– DermaPure™ line extensions

– SurgiPure™ (general surgery, wound care)

• Development– Clinical

• DermaPure™, meniscus (porcine), tendon (porcine), human heart valve

• Operations– Leeds relocation

2016

• Commercial *

– CE mark: meniscus (porcine), tendon (porcine)

– US human ortho (meniscus, tendon)

31* indicative timings only dependant on development progress, clinical trial recruitment rate & regulatory considerations

Outlook

• Strong pipeline

• Company focus shifting to commercial & manufacturing activity

• Further product development opportunities– Line extensions

• Strengthening operational management team in EU

• Depth & breadth– Geographically (USA & EU)

– Market focus (orthopaedics & wound care)

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