bdsi investor presentation
TRANSCRIPT
2021 Corporate Presentation I 1
Corporate Presentation
August 2021Nasdaq: BDSI
2021 Corporate Presentation I 2
CAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTSThis presentation and any statements of employees, representatives, and partners of BioDelivery Sciences International, Inc. (“BDSI”) related thereto contain, or may contain, among or things, certain“forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve significant risks and uncertainties. Such statements mayinclude, without limitation, statements with respect to BDSI’s plans, objectives, projections, expectations and intentions and other statements identified by words such as “projects,” “may,” “will,” “could,”“would,” “should,” “believes,” “expects,” “anticipates,” “estimates,” “intends,” “plans,” “potential” or similar expressions. These statements are based upon the current beliefs and expectations of BDSI’smanagement and are subject to significant risks and uncertainties, including those detailed in BDSI’s filings with the Securities and Exchange Commission. Actual results including, without limitation, theexpectations for total company net sales, BELBUCA net sales, operating expenses, EBITDA and operating cash flows in 2021, the acquisition and launch of ELYXYB and growth in neurology, may differmaterially from those set forth or implied in the forward-looking statements. These forward-looking statements involve certain risks and uncertainties that are subject to change based on various factors(many of which are beyond BDSI’s control) including the risk that the current coronavirus pandemic impacts on our supply chain, commercial partners, patients and their physicians and the healthcarefacilities in which they work, and our personnel are greater than we anticipate, as well as those set forth in our 2020 annual report on Form 10-K filed with the US Securities and Exchange Commission andsubsequent filings. BDSI undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future presentations or otherwise, except as required byapplicable law.
Non-GAAP Financial MeasuresThis presentation includes information about certain financial measures that are not prepared in accordance with generally accepted accounting principles in the United States, or GAAP, including non-GAAP net income and EBITDA. These non-GAAP measures are not based on any standardized methodology prescribed by GAAP and are not necessarily comparable to similar measures presented byother companies.
Non-GAAP net income adjusts for one-time and non-cash charges by excluding the following from GAAP net income: stock-based compensation expense, non-cash amortization of intangible assets, andthe financial impact of certain one-time items that are non-recurring, including the discontinuation of marketing of BUNAVAIL, and costs associated with the CEO transition in Q2 2020.
EBITDA excludes net interest, including both interest expenses and interest income, provision for (benefit from) income taxes and depreciation and amortization.
The Company's management and board of directors utilize these non-GAAP financial measures to evaluate the Company's performance. The Company provides these non-GAAP measures of theCompany's performance to investors because management believes that these non-GAAP financial measures, when viewed with the Company's results under GAAP and the accompanyingreconciliations, are useful in identifying underlying trends in ongoing operations. However, non-GAAP net income and EBITDA are not measures of financial performance under GAAP and, accordingly,should not be considered as alternatives to GAAP measures as indicators of operating performance. Further, non-GAAP net income and EBITDA should not be considered measures of our liquidity.
A reconciliation of certain GAAP to non-GAAP financial measures has been provided in the tables included in the appendix of this presentation.
Forward Looking Statement
2021 Corporate Presentation I 3
Strong Product Momentum
• Significant year over year growth in TRxs
• Continued success utilizing digital tools with in-person engagements increasing
• Focused on clinically differentiated products addressing unmet needs
• Strong formulary coverage for BELBUCA and Symproic
Solid Business FundamentalsWell-Positioned for Future
Strategy
Acquisition of ELYXYB expands BDSI’s Growth Platform into Neurology:
• Highly attractive opportunity to diversify our product portfolio
• FDA Approved, Commercially Ready Asset
• Q1 2022 Launch Planned
Rapidly Growing Commercial-Stage Specialty Pharma Company
2021 Corporate Presentation I 4
Leadership Team with Commercial & Strategic ExperienceExceptional Team with Outstanding Record of Execution and a Strategic Focus on Growth
Jeff BaileyCEO
Scott PleshaPresident & Chief Commercial Officer
Terry CoelhoExecutive Vice President & CFO
2021 Corporate Presentation I 5
High Prevalence & Quality-of-Life Impact
Long-acting Opioids (LAO) Remains a Large Prescription Market**
Significant Unmet Need in Chronic PainRepresents Large Potential Market
1. *Chronic pain limiting life or work activities on most days or every day in the past 6 months. 2. **SAO use measured as opioid prescriptions of duration 3 days or fewer. LAO use measured as prescriptions for ER/LA opioid formulations.
1CDC’s analysis of 2016 National Health Interview Survey (NHIS) data. 2 Source: Symphony Metys Data, & Symphony Vantage Application (Retail, Mail Order & LTC Data)
1 IN 5 US ADULTSsuffers from chronic pain1
19.6 MILLIONAdults report high-impact chronic pain*1
$2.9 BILLIONTotal annual LAO sales in 20202
10.8 MILLIONPrescriptions written for long-acting opioids in 20202
2021 Corporate Presentation I 6
Multiple refills allowed without a new prescription
Ability for physicians to prescribe via telehealth
Proven efficacy
Placebo like tolerability in clinical trials*
Respiratory ceiling effect
Range of 7 dose strengths
BELBUCAPhysicians Attracted by BELBUCA’s Efficacy and Safety in Managing Chronic Pain
*Package insert1. Source: Symphony Metys
BELBUCA is indicated for the management of pain severe enough to require daily, around-the-clock, long-term opioid treatment for which alternative treatment options are inadequate
230k+ patients and 22k+ prescribers to date1
BELBUCA’s classification as a Schedule III drug allows for strategic advantages over other Schedule II opioids
BELBUCA patent exclusivity through January 2027
2021 Corporate Presentation I 7
Significant YoY Growth in BELBUCA TRx VolumeBELBUCA Achieved All-Time High TRx Market Share
Source: Symphony Metys Data, & Symphony Vantage Application (Retail, Mail Order & LTC Data) *Long-Acting Opioid
Growth Metrics
+11% Q2 2021 vs Q2 2020
+5% Q2 2021 vs Q1 2021
Growing BELBUCA’s TRx Market Share through effective execution
and marketing support
0.0%0.5%1.0%1.5%2.0%2.5%3.0%3.5%4.0%4.5%5.0%
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
Q3 '17Q4 '17Q1 '18Q2 '18Q3 '18Q4 '18Q1 '19Q2 '19Q3 '19Q4 '19Q1 '20Q2 '20Q3 '20Q4 '20Q1 '21Q2 '21
TRx Volume LAO* Market Share
TRx share increased by 24% YoY to 4.7% of the LAO market in Q2 2021
• Total Rx share increasing due to broader adoption by Healthcare Professionals
BELBUCA
2021 Corporate Presentation I 8
7.2% 7.4%7.8%
6.7%
7.7%
3.8%4.1%
4.5% 4.5% 4.7%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021
NBRx Share TRx Share
BELBUCA NBRx Share Well Above TRx ShareIndicative of Future Growth Potential
Source: IQVIQ NPA DataNBRx = New-to-Brand Retail Prescriptions
TRx share increased by 24% YoY and increased compared to Q2 2021
2021 Corporate Presentation I 9
BELBUCA is Continuously Building Prescriber Base
Source: Symphony Metys Data & Symphony Vantage Application
7,494
7,782
8,043 7,986
8,345
6,000
6,500
7,000
7,500
8,000
8,500
Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021
Adding 1,000+ New Prescribers for each
of the last 8 quarters
Unique prescribersincreased 11% YoY in
Q2 2021
BELBUCA Unique Prescribers
2021 Corporate Presentation I 10
BELBUCA Enjoys Strong Formulary CoverageHistory of Consistent Year Over Year Growth Across All Payer Types
BELBUCA % Lives Preferred & Covered or Better BELBUCA TRx Count by Payer Type
Source: Fingertip Formulary & Symphony Vantage Application
60%
6%
39%
90%
33%
83%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Commercial Medicare All Payer Types
Preferred Covered or Better
53,97956,934
59,60056,530
60,566
37,778 39,35341,602
38,575 40,154
12,828 13,352 14,281 14,135 14,410
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021
Commercial, Co-Pay and Cash Medicare Medicaid
+ 12.2% YoY Growth
+ 6.3% YoY Growth
2021 Corporate Presentation I 11
Growing Policy Acceptance for BuprenorphineHHS Task Force
Health and Human Services (HHS) Task Force chartered by Congressional legislation and chaired by HHS includes more than 30 representatives from across federal government agencies, including: U.S. Food and Drug Administration • Centers for Disease Control and Prevention (CDC) • National Institutes of Health (NIH) • Office of National Drug Control Policy (ONDCP) Substance Abuse and Mental Health Services Administration (SAMHSA) • U.S. Department of Defense (DOD) • U.S. Department of Veterans Affairs (VA)
1 - Pain Management Best Practices Inter-agency Task Force Report Final Report May 20192, 3 - Pain Management Best Practices Inter-agency Task Force Report Final Report May 2019 – Page 29
HHS Task Force Report on management
of Chronic Pain, based on input from 30+ health / regulatory agencies,
recommended:
Recommendation 4A: Make buprenorphine treatment for chronic pain available for specific groups of patients and include buprenorphine in third-party payer and hospital formularies.2
Recommendation 4B: Encourage CMS and private payers to provide coverage and reimbursement for buprenorphine treatment, both for OUD and for chronic pain. Encourage primary use of buprenorphine rather than use only after failure of standard mu agonist opioids such as hydrocodone or fentanyl, if clinically indicated.3
2021 Corporate Presentation I 12
OIC Affects ~50% of Patients Taking a Class II Opioid1
1. Market Research: Segmenting OIC Patient Universe.2. When People with Opioid-Induced Constipation Speak: A Patient Survey & Patient Preferences for Change in Symptoms Associated with Opioid-Induced Constipation, N = 513 OIC Patients.3. Opioid-induced constipation in patients with chronic noncancer pain in the USA, Canada, Germany, and the UK; N = 1984. Movantik Prescribing Information.
• 94% of patients who took OTC laxatives* reported an inadequate response3
• Challenges with leading prescription products
⁃ Must be taken with food
⁃ Must stop use of laxatives
⁃ Associated with 20% instance of abdominal pain in starting dose4
*Defined as using at least one laxative ≥4 times over the previous two weeks
Up to 84%of patients with Opioid Induced Constipation (OIC) report negative impact on their quality of life2
Challenges with Leading Therapies
2021 Corporate Presentation I 13
Symproic® Offers Differentiated Profile in Treating OICSymproic Blocks the Opioid Receptors in the Gut, Attacking OIC at its Source While Allowing the Opioid to Effectively Target the Patient’s Pain
The PAMORA with More Flexibility11
(Tablet is actual size)
• Has strong clinical evidence with robust long-term efficacy and tolerability
• Carries the highest recommendation from the American Gastroenterological Association
• Ideal complementary asset to BELBUCA and is promoted to overlapping HCP targets
• Allows for samples
• Patent Exclusivity through 2031
Once Daily Any time of day
With or without laxatives With or without food
11. Symproic Package Insert 05/2020.
2021 Corporate Presentation I 14
Symproic® TRx Count & Share Since Acquisition
Symproic Quarterly TRx Count & TRx Share of PAMORA* Market16
,014
16,1
67 17,1
01
16,8
96
17,5
66
18,1
18
18,7
39
16,8
26 18,0
3110.4% 10.5% 11.1% 11.7%12.3% 12.5%
13.5%12.6% 12.7%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
7,000
9,000
11,000
13,000
15,000
17,000
19,000
Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021
Symproic TRx Count Symproic TRx Market Share
Strong rebound over previous quarter with 7%QoQ growth in TRx count
Source: Symphony Metys Data, & Symphony Vantage Application *PAMORA Market: Symproic, Movantik and Relistor
2021 Corporate Presentation I 15
Symproic NRx Count Reached a New High in Q2Symproic NRx Count Increased +7.6% from Q1 to Q2
9,860
10,163
10,628
9,961
10,715
7,000
7,500
8,000
8,500
9,000
9,500
10,000
10,500
11,000
Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021
13.4%13.6%
14.0%
13.3%
13.8%
10.0%
10.5%
11.0%
11.5%
12.0%
12.5%
13.0%
13.5%
14.0%
14.5%
Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021
Symproic NRx Count Symproic NRx Share
Source: Symphony Metys Data, & Symphony Vantage Application (Retail, Mail Order & LTC Data)NRx = New Prescriptions
2021 Corporate Presentation I 16
4,729 4,727
4,950
4,7064,865
3,000
3,500
4,000
4,500
5,000
Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021
Unique Prescribers for Symproic Remain Encouraging
Symproic Unique Prescribers + 989 New Prescribers in Q2
Unique prescribersincreased 2.9% YoY in
Q2 2021
Source: Symphony Vantage Application
2021 Corporate Presentation I 17
Symproic Favorable Formulary Coverage Continues
Symproic TRx Count in Prime Therapeutics & CVS
Source: Fingertip Formulary & Symphony Vantage Application
Symproic % Lives Preferred & Covered or Better
60%
6%
40%
89%
17%
80%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Commercial Medicare All Payer Types
Preferred Covered or Better
2021 Corporate Presentation I 18
17.3
k
17.7
k
Symproic
331k
430k
BELBUCA
104.
6k
115.
2k
BELBUCA
BELBUCA & Symproic TRx Growth Relative to Market(Retail TRx Data)
Symproic 2020 vs 2019-5.1% PAMORA Market TRx Volume Decline
+13.9% Symproic TRx Volume Growth
11.9
M
10.7
M
LAO Market
592k
561k
PAMORA Market
BELBUCA 2020 vs 2019-10.0% LAO Market TRx Volume Decline
+29.8% BELBUCA TRx Volume Growth
Source: Symphony Vantage Application
BELBUCA Q2 2021 vs Q2 2020-10.4% LAO Market TRx Volume Decline
+10.1% BELBUCA TRx Volume Growth
61k 70
k
Symproic
Symproic Q2 2021 vs Q2 2020-2.1% PAMORA Market TRx Volume Decline
+2.0% Symproic TRx Volume Growth
2.7M
2.4M
LAO Market
141.
8k
138.
9k
PAMORA Market
2019 TRx Volume 2020 TRx Volume Q2 20 TRx Volume Q2 21 TRx Volume
2021 Corporate Presentation I 19
ELYXYB Overview
2021 Corporate Presentation I 20
Attractive Product Profile
• Headache pain freedom at 2 hours post-dose**
• Most Bothersome Symptom (MBS) freedom at 2 hours post-dose*
• Tmax of ~ 60 minutes
• Self-micro emulsifying drug delivery system that improves solubility and bioavailability of the drug leading to better absorption1
• Extensive qualitative and quantitative market research indicated strong intent to prescribe by research participants
• Highly attractive opportunity to diversify our product portfolio
• Establishes a growth platform in Neurology
• Leverages BDSI team’s commercial expertise and much of commercial and corporate infrastructure
• Patent protection until 2036
• Projected to be accretive in approximately 24 months from commercial launch
• Q1 2022 Launch planned
Deal RationaleDifferentiated Product in a Large & Growing Market
• The only FDA-approved, ready-to-use oral solution for the acute treatment of migraine with or without aura in adults
• Benefits from strong growth of the substantial and evolving migraine market
• Potential for pediatric label expansion, an additional indication for the treatment of acute pain, and includes the rights to commercialize in Canada.
ELYXYB Expands BDSI’s Presence in Neurology in Attractive Deal
* Results of 2 Pivotal studies comparing patients receiving ELYXYB to patients receiving placebo with the percentage of patients achieving MBS freedom at 2 hours post dose being significantly greater than patients receiving placebo** Results of Pivotal study 2 comparing patients receiving ELYXYB to patients receiving placebo with the percentage of patients achieving headache pain freedom at 2 hours post dose being significantly greater than patients receiving placebo1. Arindam Pal, Srinivas Shenoy, Anirudh Gautam, Sagar Munjal, Jing Niu, Mathangi Gopalakrishnan & Joga Gobburru, Clinical Drug Investigation volume 37, pages 937–946(2017)
2021 Corporate Presentation I 21
Sales MilestonesTransaction Terms
ELYXYB Acquisition – Agreement Signed August 3, 2021*
• $6M upfront payment at closing
• $9M August 3, 2022
• Tiered Quarterly Earn-Out Payments in the high single-digit/low double-digit range based on net sales performance
• Contingent payments based on achieving certain regulatory milestones
• Sales milestone payments based on achieving certain net sales thresholds
* The closing of the transaction is subject to satisfactory completion of customary closing conditions, including the applicablewaiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (HSR Act).
2021 Corporate Presentation I 22
$27.0$46.0
$97.5
$136.1
$8.1
$14.7
$62.01
$55.6
$111.4
$156.5
$0.0
$20.0
$40.0
$60.0
$80.0
$100.0
$120.0
$140.0
$160.0
2017 2018 2019 2020
$M
BELBUCA Symproic Other
Robust Annual Net Revenue Growth Trends
1. $20 M of deferred revenue included in 2017 upon termination of BDSI’s commercialization license with Endo Pharmaceuticals2. BUNAVAIL and royalty revenues
Total Net Revenue + 40%
in 2020 vs. 2019
BELBUCA Revenue + 40%
in 2020 vs. 2019
2
2021 Corporate Presentation I 23
Sales Trajectory Driving Impressive Annual Gross Margin and Profitability
84.2%80.6%71.6%68.5%
0.0%
20.0%
40.0%
60.0%
80.0%
100.0%
2020201920182017
% N
et S
ales
Gross Margin$40.5
$12.5
$(17.5)$(23.3) $(40.0)
$(25.0)
$(10.0)
$5.0
$20.0
$35.0
$50.0
2020201920182017
$M
EBITDA
26% of Net Sales
See appendix for GAAP to non-GAAP and EBITDA reconciliations
$25.7
$(15.3)$(21.7)
$5.3
$44.2
$13.2
$(33.9)
$(1.0)
$(45.0)
$(30.0)
$(15.0)
$-
$15.0
$30.0
$45.0
$60.0
2020201920182017
$M
Net Income/(Loss)
Non-GAAP
GAAP
2021 Corporate Presentation I 24
Solid Quarterly Net Revenue Growth Trends YoY
1. 1. BUNAVAIL and product royalty revenues
Net Revenue Growth+13%
in Q2 2021 vs. Q2 2020 $32.3 $34.8 $35.6 $36.4 $36.5
$3.4 $3.5 $3.7 $4.4 $4.0$36.6
$39.4 $42.2 $41.0 $41.4
$-
$10.0
$20.0
$30.0
$40.0
$50.0
Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021
$M
BELBUCA Symproic Other 1
2021 Corporate Presentation I 25
Attractive EBITDA Margins Driven by Healthy Gross Margins While Continuing to Invest to Support Brand Growth
89.7%85.8%80.3%86.4%85.1%
0.0%
20.0%
40.0%
60.0%
80.0%
100.0%
Q2 2021Q1 2021Q4 2020Q3 2020Q2 2020
% N
et S
ales
Gross Margin
$13.1
$9.2
$14.3 $13.4
$5.1
$-
$5.0
$10.0
$15.0
Q2 2021Q1 2021Q4 2020Q3 2020Q2 2020
$M
EBITDA32% of
Net Sales
$1.2
$9.4 $10.2
$5.2 $9.1
$9.6
$12.7 $13.7
$8.5
$12.5
$-
$5.0
$10.0
$15.0
Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021
$M
Net Income
Non-GAAP
GAAP
See appendix for GAAP to non-GAAP and EBITDA reconciliations
2021 Corporate Presentation I 26
As of June 30, 2021:
$119.9 million Cash and cash equivalents
$80 million Long-term debt
Operating Cash Flow of $9.2M in Q2 Supports Increasing Cash Balance
Share repurchase program authorized November 2020; Up to $25 million
$12.1 million used to repurchase 3.3 million shares through Q2 2021
Advantageously Positions BDSI for Continued Growth
$91.0 $100.2
$111.6 $116.4 $119.9
$-
$25.0
$50.0
$75.0
$100.0
$125.0
Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021
$M
Cash
2021 Corporate Presentation I 27
2021 Expectations for Ongoing Business
Total Company Net Sales $170 - $180M
BELBUCA Net Sales $155 - $165M
Total Operating Expenses $115 - $120M
EBITDA $40 - $50M
Operating Cash Flow positive in 2021
2021 Corporate Presentation I 28
Total Company Net Sales YoY Growth of 13%:
• BELBUCA +13%
• Symproic +18%
Solid Performance in Q2 2021 and Positioned Well for Future Growth
ELYXYB Acquisition Expands BDSI’s Presence in Neurology
• Attractive 32% EBITDA Margin
• $120M Cash Balance
• $9.2M Operating Cash Flow
• Strong balance sheet to support BDSI’s continued growth
2021 Corporate Presentation I 29
Reconciliation of GAAP to Non-GAAP Metrics Q1 2020 – Q2 2021
QTD- Q1 QTD- Q2 QTD- Q3 QTD- Q4 QTD- Q1 QTD- Q23/31/2020 6/30/2020 9/30/2020 12/31/2020 3/31/2021 6/30/2021
GAAP Net Income 4,966$ 1,165$ 9,383$ 10,197$ 5,237$ 9,064$ Add back/(subtracts):
Income tax recovery/(provision) (278) 86 211 233 222 312 Net interest expense 1,294 1,685 2,012 2,022 1,979 1,999Depreciation and amortization 1,802 2,159 1,754 1,806 1,753 1,769
EBITDA 7,784$ 5,095$ 13,360$ 14,259$ 9,191$ 13,144$
GAAP Net Income 4,966$ 1,165$ 9,383$ 10,197$ 5,237$ 9,064$ Non-GAAP adjustments:
Stock-based compensation expense 1,520 1,364 1,473 1,750 1,490 1,697 Amortization of intangible assets 1,781 1,734 1,734 1,733 1,735 1,735 Non-recurring financial impact- CEO transition - 5,078 67 - - - Non- recurring financial impact- BUNAVAIL Discontinuation - 295 - - - -
Non-GAAP Net Income 8,267$ 9,636$ 12,657$ 13,679$ 8,462$ 12,496$
Reconciliation of GAAP Net Income to Non-GAAP Net Income
BIODELIVERY SCIENCES INTERNATIONAL, INC. AND SUBSIDIARIES RECONCILIATION OF NON-GAAP METRICS
(U.S. DOLLARS, IN THOUSANDS) (Unaudited)
Reconciliation of GAAP Net Income/(Loss) to EBITDA (non-GAAP) 2020 2021