Conquering Upper Limb Paralysis with Wearable Medical Robotics
25
NYSE American: MYO Conquering Upper Limb Paralysis with Wearable Medical Robotics Paul R. Gudonis, Chairman and CEO David Henry, CFO 1 Investor Presentation November 2021
Conquering Upper Limb Paralysis with Wearable Medical Robotics
Paul R. Gudonis, Chairman and CEODavid Henry, CFO
1
Investor PresentationNovember 2021
Presenter
Presentation Notes
This is Paul Gudonis, CEO of Myomo, and with Dave Henry our CFO, we’ll introduce you to the company and provide an update on some of our recent results. Myomo – My Own Motion – is the leader in medical robotics that is enabling paralyzed individuals to restore function to their arms and hands. We are traded on the NYSE American under symbol MYO, and our HQ is in Cambridge, MA.
NYSE American: MYO
Legal DisclaimerThis presentation contains forward-looking statements regarding the trading of the Company’s common stock on the NYSE American,the Company’s plans for the use of proceeds and advancing its product line, increasing its sales and marketing efforts and growing itsbusiness, the Company’s financial position and projections of future operating results, and the Company's future business expectations,which are based upon the current estimates, assumptions and expectations of the Company’s management and its knowledge of therelevant market. The Company has tried, where possible, to identify such information and statements by using words such as“anticipate,” “believe,” “envision,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,” “project,” “target,” “potential,” “will,”“would,” “could,” “should,” “continue,” “contemplate” and other similar expressions and derivations thereof in connection with anydiscussion of future events, trends or prospects or future operating or financial performance, although not all forward-lookingstatements contain these identifying words. Forward-looking statements, which are included in accordance with the safe harborprovisions of the Private Securities Litigation Reform Act of 1995, are only predictions and may differ materially from actual results dueto a variety risks, uncertainties and other factors. These risks and uncertainties include, among others, risks related to the Company’sliquidity and financial position, the trading of its common stock, its new products, services, and technologies, government regulationand taxation, and fraud. More information about factors that potentially could affect Myomo's business and financial results areincluded in the Company’s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. The Company cautions readers not toplace undue reliance on any such forward-looking statements, which speak only as of the date made. The Company disclaims anyobligation subsequently to revise any forward-looking statements to reflect events or circumstances after the date of such statementsor to reflect the occurrence of anticipated or unanticipated events.
2
Presenter
Presentation Notes
Please review our Safe Harbor statement regarding any forward-looking statements in our presentation.
NYSE American: MYO
Company Overview
3
Only commercially available device of its kind with FDA registration, government and private reimbursement and CE mark
We design, manufacture and provide the MyoPro™, a wearable medical
robotic device that restores movement and function of paralyzed
arms and hands
Can benefit patients suffering from stroke, brachial plexus injury, traumatic brain or spinal cord injury, as well as ALS or other neuromuscular disease/injury
Lightweight and portable, to enable users to perform Activities of Daily
Living
Presenter
Presentation Notes
Myomo is a commercial-stage company that provides the MyoPro, a lightweight, portable arm brace using advanced robotics to enable users to perform Activities of Daily Living such as cooking, feeding themselves, and carrying household objects. We have the only such patented devices in the market today, it’s registered With the FDA in the US and has CE Mark for European distribution, and a growing number of government and private payers are reimbursing the cost for patients. It is indicted for use by patients with upper extremity paralysis due to stroke, brachial plexus and spinal cord injuries, and other neuromuscular disease or injury.
NYSE American: MYO
Investment Highlights: Market Leader in New Product Category
Creating a new product category for this large unmet medical need- Patient Population with Chronic Arm Paralysis = Approx. 3M in US- New Incidences in US each year = Approx. 250K due to new strokes, other neuro conditions- Worldwide need: Prevalence = Approx. 1% of Population
Experienced management team is rapidly scaling the only commercially-available device to restore function for upper extremity paralysis- Growth rate of revenue is accelerating. 2020 Revenues up 98%; YTD 2021 revenue up 159% YoY
Strong candidate pipeline growth in 2021 from ongoing rollout in US and International markets- Continued high number of insurance authorizations and orders in Q3 (133 units) and record Backlog = approx.
$6.2M pending revenue
Emphasizing our growing Direct Billing channel, resulting in higher ASPs and gross margin (75%)
Cash position as of 9/30/21 = $12.6 million. Pro forma for warrant exercise transaction in October, Cash = $17.4 million. Almost two years of cash at current burn rate.
4
Presenter
Presentation Notes
From an investor’s perspective, the key considerations are the large unmet medical need – approx. 3M patients with chronic arm paralysis just in the US, and Approx. a quarter of a million new cases each year, and an estimated worldwide prevalence at 1% of the population We have an experienced management team of technology and healthcare professionals with track records of scaling operations As you’ll see, we have accelerated our pipeline growth with direct-to-patient marketing and have shifted 2/3 of our business to our own Direct Billing channel, Resulting in higher Average Selling Price (revenue per unit) and margins. Today we pre-announced record quarterly and annual revenues, as we adapted our Operations to the COVID pandemic; and we have a strong balance sheet with $12.3M of cash on hand at year end, no debt, and decreasing cash burn as we make progress toward our goal of cash flow breakeven.
NYSE American: MYO
If You Know 100 People, You Probably Know Someone who needs a MyoPro
5
Presenter
Presentation Notes
Let’s take a look at the size of our target market. With a prevalence of 1% of the population, if you know 100 people, you probably know someone who needs a MyoPro. Maybe it’s a family member who survived a stroke but is left with hemi-paresis, paralysis of the arm and leg on one side of the body; or a veteran that suffered a Traumatic Brain Injury while in combat; or someone left with a spinal cord injury due to a car accident. When we could conduct these investor presentations in person, on several occasions I’ve had audience members come up to me afterward and ask for information for a family member or neighbor who was paralyzed.
NYSE American: MYO
A Large Unmet Need: Sizing the Market Opportunity
New incidences:US: 800,000 strokes / yr.+ other Dx
6 - 12 mos.Rehab Therapy
1/3 Enter Prevalence Group
PrevalencePopulation
(Chronic ArmParalysis)
Living At Home
Medically Qualified
Insurance Reimbursement
PatientInterest
StrokeSpinal Cord Injury
Brachial PlexusInjury
Traumatic BrainInjury
Cerebral PalsyMultiple Sclerosis
ALSetc.
Addressable Market
Source: Christopher and Dana Reeve Foundation Survey, National Stroke Association, World Health Organization, and Myomo base model estimates
6
Presenter
Presentation Notes
Taking a deeper dive into the market opportunity, this is a large and growing market. There are 800,000 new strokes each year, just in the US, plus other causes of Upper Extremity paralysis. Strokes arise as a result of blood clots or bleeding in the brain, and approx. 1/3 of those afflicted die from the complications, about 1/3 recover through rehab therapy, and the other 250,000 patients plateau and are left with arm paralysis and enter the Prevalence Population with chronic arm paralysis. Other diagnoses include spinal cord and brachial plexus or shoulder nerve injury, cerebral palsy, MS, ALS, and other indications. We hen refine our addressable market by focusing on those that are living at home (not in a nursing facility), pass our medical screening, have insurance plans that will cover the MyoPro, and are Interested in wearing the device to restore their lost arm function. We estimate this to be about 10% of the total chronic population, or 300,000 prospects – at an our ASP of $35,000 per unit, this represents a significant market opportunity – and one that grows each year due to new strokes and other conditions.
Myomo Addresses an Unmet Need that Existing Upper Extremity Treatments Don’t
Current Treatment Options
Rehabilitation:
➢ Occupational therapy
➢ Static bracing
➢ Saebo
➢ Electrical stimulation(Bioness)
➢ Stationary robotics
Medical:
➢ Botox
➢ Baclofen
7
The Medical Need:
A lightweight, portable
device to restore
function for use at
home, work, and
school
Presenter
Presentation Notes
So what happens today to someone who has a stroke or other neuro injury? After discharge from an acute care facility, they will go to a rehab hospital for Occupational Therapy to encourage restoration of movement by a therapist, or a large robotic machine in the clinic, and for those with spasticity – a painful, Tightly clenched arm or hand, they may get Botox our Baclofen. However, many patients “plateau” after 6-12 months and are left with chronic arm Paralysis and told ”You’ll never move that arm and hand again so get used to it.” We’re showing that this conventional wisdom does not apply any longer.
NYSE American: MYO
MyoPro Users and Value Propositions
8
Bettina• Skiing accident @ age
15 led to brachial plexus injury
• No use of right arm for 20 years
• Avoided amputation by obtaining MyoPro
Lucinda• Stroke during brain tumor operation • Restored use of arm and hand • Able to return to work
Igal• No use of right arm,
4 years post-stroke• Able to perform
activities of daily living
Dave• US veteran, arm
paralyzed due to stroke• VA-provided MyoPro led
to active use of arm and hand
Presenter
Presentation Notes
Here are several of our MyoPro users: Bettina, a German woman is wearing a MyoPro on her right arm which was paralyzed in a skiing accident at age 15. Instead of amputation of the “dead arm”, she is able to use both arms again with our device. Lucinda suffered a stroke during an operation to remove a brain tumor, which left her right arm paralyzed. She’s now cooking again and takes her MyoPro to work at a retail store. Igal is a college professor who has not been able to use his right arm for 4 years since his stroke; here you can see him cooking at home while wearing his MyoPro. And Dave is a US Military veteran, who was provided a MyoPro by his VA Medical Center after his stroke.
NYSE American: MYO
Myomo’s Technology Leadership
9
Neuroscience Robotics
Software
Operating at the Intersection of 3 Scientific and Engineering Disciplines
• Brain-Computer Interface via EMG Sensors • Wearable Robotics• Advanced Control Algorithms• Patent Portfolio For EMG-Controlled
Orthotics Extended to 2039• New Patents for China and Hong Kong
granted
Presenter
Presentation Notes
We are able to accomplish what has never been done before due to our technology leadership by operating at the intersection of three exciting areas: Neuroscience, Robotics, and Software. We have a proprietary brain-computer interface, sensors, software algorithms, and a dozen patents, including several new ones, which protect our technology through the year 2039.
NYSE American: MYO
Brain Signal
EMGSensor
Signal Processing
Movement
MyoPro Powered Arm Brace: How it Works
10
Presenter
Presentation Notes
Based on technology developed at MIT and by staff of Harvard Medical School, our MyoPro arm brace shown here works by having the user just think about moving their arm . The brain sends a signal to the muscle, and if you are a healthy individual, you can move your arm, pick up objects, and feed yourself. The muscle emits a trace microvoltage, called the Electromyogram or EMG signal, which can be picked up on the surface of the skin. However, those patients with damage to the motor neurons or peripheral nerves have an attenuated signal – sometimes less than 1% of a able-bodied person. As a result, they’re frustrated, they can’t move the arm or open their hand. Our devicehas built-in sensors which pick up this microvoltage – which we can now amplify up to 100,000X – and with the onboard microprocessor, software, and small motors, we enable the arm and hand to function again. As our first user Maggie stated, “It’s like My Own Motion”, hence the name of the company. This wasn’t possible in the past because it takes advanced computing capabilities, lightweight materials, and small motors and batteries that were just not available years ago.
NYSE American: MYO
LowerLimb
Products
UpperLimb
Products
LowerLimbProducts
UpperLimb Products
ExoskeletonsFoot Drop
Only commercially available upper limb product line to restore function
Unit Volume
Orthotics (Braces)Prosthetics
Stance Control
Competitive Positioning
11
Wheelchair
Presenter
Presentation Notes
We are part of the multi-billion dollar Orthotics and Prosthetics (or O&P) segment of the medical device market. As you can see on this chart, there are upper and lower limb devices. Prosthetics are for amputees, and this is a fairly mature market. Orthotics, which is the clinical term for braces, are designed for the much larger Population for those who have their limbs but are impaired in some way. There are lots of alternatives if one leg paralysis: electrical stimulation, basic braces, exoskeletons, and wheelchairs for mobility. However, MyoPro is the only device designed to be portable, for use at home, work or school, and our strategic focus is to penetrate and lead in this product category.
NYSE American: MYO
Trends in Healthcare Fueling Myomo’s Growth
Large and Growing Pool of Patient Candidates- Stroke Incidence increases with Aging Population,
Underlying Health Conditions Centralized Decentralized Patient Care
- From Rehab Clinic to At-home Use In-person Visits Telehealth
- Enabled by Broadband Internet Clinician Recommendations Patients & Families
seeking information on Healthcare Options→ - Direct-to-Patient Marketing
12
Presenter
Presentation Notes
As you’ll see in our revenue growth, we are benefiting from several major tends in healthcare: Our pool of candidates is large and growing due to an aging population, since stroke incidence increases with underlying health conditions such as high blood pressure, high cholesterol levels, and other conditions; There has been a shift from to decentralized patient care, with an emphasis on home use The pandemic and broadband Internet have accelerated the trend toward telehealth An increasingly, patients and families are taking the lead on finding healthcare information, rather than waiting for a recommendation by a clinician
NYSE American: MYO
Over-Arching Strategic Goal = Market Penetration
Increasing Market Awareness & Candidate Pipeline via Increased Advertising- Cost-effective CAC per Pipeline Add leading to ASP = $35,000 @ 70% +
gross margin
Utilizing Digital Technologies to Accelerate Cycle Times and Reduce Costs- Online marketing, Telehealth evaluations, Cloud-based data collection
Expanding # of Payers Reimbursing for a MyoPro in the US
Entering Additional Countries outside the US via local distribution partners
13
Improve the Lives of a Growing Number of Patients each year by…
Presenter
Presentation Notes
So we have adapted our business to these trends and are filling our pipeline with patient candidates via digital marketing on social media platforms and Google And we now evaluate patients online instead of setting up in-person appointments: It’s more convenient for us and the patient; we can do it the next day after a prospect contacts us; there are no travel costs; and in this time of COVID, it’s safer for everyone.
NYSE American: MYO
Go to Market Approach: Direct Billing and Provider
Lead Generation
&Evaluations
Reimbursement Approval
Delivery&
Payment
Custom Fabricated
MyoPro
14
Common Robotic ComponentsMass Customization
Presenter
Presentation Notes
We go to market through several channels: O&P clinics resell our products and deliver to their patients; VA hospitals purchase the MyoPro for veterans in their care; and in the past 18 months, we have integrated forward as a provider directly to patients and billing their insurance co’s ourselves. The process to obtain a MyoPro is as follows: First we generate the lead and evaluate them as medically qualified; then we work to obtain an insurance pre-authorization (similar to what you need to do for a knee or hip replacement), and then upon approval, we custom fabricate the MyoPro from our outsourced robotic kit and fabrication vendors, and then delivery the device to the patient and file the insurance claim.
NYSE American: MYO
Filling the Pipeline via Digital Marketing and Telehealth
Digital marketing to patients and families (B2C) 700,000+ likes on TikTok
15
Moved online: faster, more convenient, less costly
TeleHealth EvaluationsOnline Marketing Ads Social Media
Presenter
Presentation Notes
So we have adapted our business to these trends and are filling our pipeline with patient candidates via digital marketing on social media platforms and Google And we now evaluate patients online instead of setting up in-person appointments: It’s more convenient for us and the patient; we can do it the next day after a prospect contacts us; there are no travel costs; and in this time of COVID, it’s safer for everyone.
NYSE American: MYO
Increasing # of Payers reimbursing cost of a MyoPro
16
Commercial Payers Military Medicare
• Approvals on a case- by-case basis
• > 80% of Pipeline consists of patients with insurers who have authorized or reimbursed for the MyoPro
• Approved for Vets• > 40 VAMC’s have
ordered MyoPro’s
• New HCPCS codes in 2019
• Medicare Advantage claims paid
• Part B Medicare under discussion
Presenter
Presentation Notes
After a patient is evaluated as a suitable candidate for the MyoPro, we seek reimbursement from their insurance plan prior to delivering a device. We are getting paid by certain commercial insurance plans on a case-by-case basis (and now over 90% of our new pipeline is Direct Billing cases); the VA has fit Veterans at over 40 VA Medical Centers around the country; and we achieved a major milestone in January of 2019, when two new HCPCS codes for the MyoPro went into effect. As a result, the MyoPro is being reimbursed by Medicare Advantage plans, which cover 35% of seniors – and this % is expected to grow over time. As for Part B Medicare beneficiaries, we are still in discussions to correct the Benefit Category Designation from DME Rental to Custom Orthotics paid as a lump sum (as all the other payers do). Due to all of the other CMS activity re COVID, action on this topic has not moved ahead as fast as we have expected, and I hope we can get it favorably resolved for these patients this year.
Once coverage and fee are determined by CMS, Myomo will be able to provide the MyoPro to Medicare Part B patients in 39 states
Working on becoming certified in the remaining states
Working on becoming a provider for patients covered by state Medicaid plans
Can now begin the process of entering into contracts with commercial insurance payers as a provider
Presenter
Presentation Notes
To serve these Medicare Part B patients in the future, we announced that we are now a Certified Medicare Provider, which required implementing a Compliance Program as a Direct Provider. This enables us to bill Medicare when coverage is established and to enroll as a provider in state Medicaid plans. Being certified Is also a pre-requisite for entering into commercial payer contracts, so we are now able to initiate this activity. I’ll now turn the presentation over to our CFO, Dave Henry.
NYSE American: MYO
International Update: Activity in Key Markets
18
China JV company established- 19.9% Equity Interest for
MYO shareholdersChina patents issuedNext: Funding and LicenseAgreement
Australia O&Psstarting to order
Pipeline growing in UK
German O&Ps orderingMyoPro’s; SHI now covers40% of population; Italy reopening
NYSE American: MYO
MyoPro Delivery and Payment: Shift to Direct Billing
• Emphasis on the direct billing channel results in higher average selling price and higher gross margin per unit
• International revenue expected to grow in the future as we capitalize on favorable coverage policy in Germany and work to obtain coverage policies in other countries
• Revenue recognition timing:• Direct Billing – Effective Q4’20,
certain payers recognized on delivery (represents ~ 40% of direct billing revenue), rest upon payment, 45 days to 6 months after delivery
• O&P/VA Channels – Upon shipment• International – Upon delivery
Presenter
Presentation Notes
DB has been increasing as a percentage of revenue over the last 18 months to 68% of total revenue in Q3 as you can see by the blue bar. As we mentioned DB results in higher ASP and GM per unit because we are not paying a middleman and can keep all of the fee for ourselves. In terms of the other channels, Int’l represents approximately 10% of revenues, with the remainder in the Q&P and VA channels. We recognize revenue differently in each channel. With Direct billing we announced today that we have sufficient payment history to record revenue on deliveries to patients carrying certain insurance plans at the time of delivery. We are implementing this in Q4. The remaining 60% of DB revenue is currently recognized at payment. Revenue in the other channels is typically recognized upon either shipment or delivery, depending on the delivery terms with the customer
NYSE American: MYO
Backlog: Authorization to Revenue - Near-Term IndicatorPipeline: Successful Evaluation to Authorization – Longer-Term Indicator
Operating Loss (2,030)$ (2,545)$ (7,562)$ (10,503)$
Int and other exp, net 4 42 10 475 Change in fair value of derivatives - (1) - (123) Loss on Ext. of Debt - 189 - 709 Income Taxes 23 1 67 -
27 231 77 1,061
Net Loss (2,057)$ (2,776)$ (7,639)$ (11,564)$
Presenter
Presentation Notes
Turning to the P&L, we’re still closing Q4, so these are Q3 results. Revenue of $1.9M in Q3 tripled over the prior year. Gross margin was 56% in Q3. Contribution margin on incremental revenues is expected to be in the 70% range. Q3 gross margin was effected by having to recognize cost of goods sold upon shipment but recognizing revenue under DB upon payment. A side effect of the revenue accounting change should be to elevate gross margin to be closer to the contribution margin since that timing difference, at least for 40% of direct billing revenues, is being eliminated. Opex was $3.6M in Q3, up over Q3 a year ago as we have added headcount to support our growth and we brought back almost all employees that were furloughed during the lockdown in Q2. What we are striving to do is to grow revenue faster than opex, which you can see in our lower operating loss in Q3. As revenue increases ,we expect the operating loss and cash burn to shrink. Speaking of cash, we ended Q3 with $13.3M in cash, with cash burn of $1.8M, excluding $4.4M of proceeds from sales of shares under out ATM. We annoucned today that Q4 ending cash was $12.3M and the cash burn reduced to $1.1M, the lowest since our IPO in 2017. There were no dilutive financing activities in Q4
NYSE American: MYO
Leadership Team & Board of Directors
Management Team Members Board of Directors & AdvisorsPaul R. Gudonis Chairman & CEOScaled multiple tech co’s, largest from $5M to $1.2B revenue (BBN/Genuity)
Ross D. Zafonte, DOChair, SABHarvard Med. School,Spaulding Rehab.
Gene Tacy, MSEE VP of EngineeringDeveloped Myomo’s proprietary EMG powered medical devices
Thomas Kirk Lead Independent DirectorFormer CEO, Hanger Clinics
Dr. Harry KovelmanChief Medical OfficerTrack record of expanding patent access for new technologies
Amy Knapp Board MemberBrightHealth, United Healthcare
Milton MorrisBoard MemberPresident & CEO, Neuspera Medical
Thomas CrowleyBoard MemberExperienced Med Device CEO
David Henry, CFORaised nearly $900M in capital for public companies
Jonathan Naft CPO, VP | GMDeveloped new O&P industry products,Opened international markets for Myomo
1
Micah MitchellChief Commercial OfficerGrew sales 10x at several custom DMEbusinesses
23
Cliff ConneightonChief Marketing OfficerLed marketing to grow ATG to $500Min revenues
Kathy Sawyers, PT, ATP Sr. Dir. – Clinical OutcomesOversees clinician training and user support
Courtney Maulen, MS, OTR/L Built Dept. of Patient Advocacy to process 10x growth in claim volume
Barry CamrellVP of QA/RAEstablished quality systems for U.S. and int’l markets
Presenter
Presentation Notes
We have a strong team of executives that have scaled businesses in new technologies and medical equipment, and we have experienced leaders in Engineering, Marketing, and Product Development, and we recently welcomed a new Chief Medical Officer in Dr. Harry Kovelman. Our Scientific Advisory Board is led by Dr. Ross Zafonte, a national leader in physical medicine and rehab at Harvard Medical School, and our Board of Directors consists of executives who built companies in healthcare services, health insurance, and medical devices.
NYSE American: MYO
Near Term Catalysts
24
New research publications and studies undertaken
Positioned for strong revenue growth in 2022:• Increased pipeline and backlog from direct-to-
patient marketing• Additional payers covering the cost of MyoPro
China JV company funding and initial license fees paid
Presenter
Presentation Notes
From an investor’s perspective, the key considerations are the large unmet medical need – approx. 3M patients with chronic arm paralysis just in the US, and Approx. a quarter of a million new cases each year, and an estimated worldwide prevalence at 1% of the population We have an experienced management team of technology and healthcare professionals with track records of scaling operations As you’ll see, we have accelerated our pipeline growth with direct-to-patient marketing and have shifted 2/3 of our business to our own Direct Billing channel, Resulting in higher Average Selling Price (revenue per unit) and margins. Today we pre-announced record quarterly and annual revenues, as we adapted our Operations to the COVID pandemic; and we have a strong balance sheet with $12.3M of cash on hand at year end, no debt, and decreasing cash burn as we make progress toward our goal of cash flow breakeven.
