IonExpressShiva Portonovo (EL)

Jason Poulos (M)Jacob Schmidt (PI)

Govt ctrs

One TimeInstrument

Recurring Consum.

Direct, partner

Direct

Distributors

Fast

Low cost

Inst. Inj. mold

IP, cells

Inst. mfrs.

Inj. mold

Reprod.Assay dev

Install/demo

Easy to use

new targets

low run cost

Low cost

Beta Feedback

Winning KOLs

Cells

assembly One Timewarranty

Recurring Maint

Recurring Train.

Recurring Software

S/M Pharma

L Pharma

CROs/ Univ Labs

Service

Who we have talked to

• Alan Wickenden, J&J• Injection mold prototype companies• Robert Damoiseaux, CNSI UCLA• John Comley, IC screening market expert• Competitors’ websites

Revenue Model

• Instrument and consumable are sold directly to customer– Instrument uses conventional direct sales force– Consumables are sold direct over the web– As done by our APC competitors

Screening Customer IonExpress

Product Offerings

• Group instrumentation and consumables by capacity and function– 48 channel system (“Best Value”)

• Instrument• Plates

– 192 channel system (“Highest throughput”)• Instrument• Plates

– High speed solution perfusion system (“High performance”)• Instrument• Plates

Our Pricing

• Group instrumentation and consumables by capacity and function (pricing for adoption)– 48 channel system (“Best Value”)

• Instrument- $200k (Fluxion: $250k) • Plates- $50 (Fluxion: $150)

– 192 channel system (“Highest throughput”)• Instrument- $500k (Barracuda 384: $750k-$1M)• Plates- $125 (Barracuda 384: $250-$300)

– High speed solution perfusion system (“High performance”)• Instrument (48 chan)- $300k (N/A)• Plates- $100

Instrumentation and Plates• Instrumentation components are mostly off the shelf OEM

equipment– 96 channel Fluid handler $36k– Multichannel amplifier $50k/48 channels– Robotic arm $20k– Software???

• Plates: 3 pieces – Injection mold top and bottom pieces

• Until we get to high volume, materials costs are not the dominant costs– they are tooling and mold operation

– Center film is laser cut and sandwiched between top and bottom pieces• In house?

COGS and Operating Cost Bottom Up Estimate (conservative)

• Instrumentation - $135k/instrument– $120k Components/materials– $10k Labor– $5k(?) Operations (how does this scale?)

• Plate - $5/plate– <$1 materials– $2 Labor (assembly)– $2(?) Operations (how does this scale?)

Customer Usage

Entities <Sites/ entity>

<Labs/ site> Total labs <Screens/

yr/lab><DP/

screen>Equiv # 48 well

Plates/yr

L Pharma 20 3.5 4 280 6.7 20k 782000

M/S Pharma 500 1.25 1.5 938 4.1 10k 801000

Govt/ Acad 50 1 1 50 4.0 10k 42000

Customer Segment and Plate Usage

Adoption and Sales

Year Users and Instruments # Plates

1 3 2000

2 14 12000

3 27 28000

4 58 60000

5 113 123000

Year % L Pharma % M/S Pharma % Govt/Acad

1 0% 0% 5%

2 0% 1% 10%

3 1% 2% 10%

4 2% 5% 10%

5 5% 10% 10%

Estimated Adoption by Customer Segment

Estimated Sales

Income StatementYear 1 2 3 4 5

Revenue ($M) 0.6 3.0 3.8 9.2 17.2COGS + Ops.

($M) 0.3 1.7 1.8 4.5 8.1

Profit ($M) 0.3 1.3 2.1 4.7 9.1

0

5

10

15

20

1 2 3 4 5

$M

Year

Revenue ($M)

COGS ($M)

Profits ($M)

• 1st $100k/mo revenue happens in Year 2

• 1st $1M/mo revenue happens in Year 5

Customer Lifetime Value• Instrument– One time initial purchase ($200k)– To increase capacity/throughput, small number of additional

purchases possible ($200k+)• Consumable– Recurring purchases: ~ 2800 plates/yr for each lab in big

pharma ($140k/yr)• Lifetime revenue value: – Instrument: $200k in Year 1 + $200k in Year 4– Plates: $140k/yr Years 1-3 and $280k/year Years 4-10= ~$2.25M discounted at 5%/yr