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Brain Resource Limited
Scalable products that ASSESS, TRAIN, and MONITOR the brain
Investor presentation - March 2015
Contacts: [email protected] [email protected]
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Accelerating traction and annuity revenue growth
Platform used for all product delivery:
1. Employer: Clients include Facebook, Boeing, Cisco, Cerner, Aetna, Kaiser highlighting the importance placed by Corporate America on Employee Mental Wellness and Resilience ($5 billion pa market).
2. Addiction: Maintaining 2014 run rate of signing a clinic / week as professionals in the market embrace the need for products that manage cravings ($25 billion pa market).
3. Depression Test: A milestone in psychiatry with publication of the First Test to predict Treatment Response in Depression – FDA submission for this Test in the final stages ($100 billion pa market).
First mover position in all 3 products: highly scalable, cost savers, meet large needs, high customer retention rates and with accelerating annuity revenue growth.
Largest standardized Brain Database in the world scientifically underpins all products.
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1. MyBrainSolutions for Employer: brand name clients
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Employer / Distributor Contracts(Paid per Employee per Month)
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Benefit: Boosting Employee Resilience and Wellness
MyBrainSolutions for Employer is used by employees of corporations – a $5 Billion pa sector:
• $150 million pa addressable market - based on 18,000 US employers which employ 61 million.
• First target is $10 million pa - based on winning 200 of the top 1,000 (that employ >10,000 @$30,000 per employer) and 500 average employers (@8,000 per employer).
• $1.1 million pa current value of BRC contracts, including all in sales represents growth of 200% FY2014 sales (36 contracts covering 500,000 employees). Annuity revenue, high employee uptake and customer retention.
• Upside to initial target includes: Low cost per client acquisitions. Distributors including Aetna (4,000 employer clients), Mercer, Kaiser (1 million members) and Cerner (3,000 hospitals).
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An Integrated Online Platform for Brain Health
Assess Train Monitor1. 2. 3.
Strengths & limitations Recommendations for training Decision Support (for clinicians)
Develop new brain habits Online and mobile Cognitive and emotional
Track progress Feedback helps build new habits Customized to employer program
www.MyBrainSolutions.comScientifically validated Brain Health Assessment & Brain Training Modules
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Jun-13 Jun-14 Dec-14 2015 to date
Addiction contracted clinics(Paid $70 per user)
2. MyBrainSolutions for Addiction: clinic sales growth 1 per week
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Benefit: manage cravings and support recovery
MyBrainSolutions for Addiction Recovery is used to manage cravings and support recovery:
• $25 billion pa market and set to double by 2020 - $9 billion of this speciality substance abuse centers. 23 million in US need substance abuse treatment but only 11% get treated.
• 12,000 addiction clinics in the U.S.
• $7.5 million initial target based on winning 500 centres / 100,000 patients.
• Currently have 57 centers - rapid recent growth, adding centers at rate of one per week.
• Clinics pay $70 per individual client user for 90 days (per clinic range has been between $1,000 to $70,000 pa).
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Large potential gains from converting Market Leaders
Current relationships:
• New client Bayside Marin is part of Acadia Healthcare, the leading pure play behavioral healthcare services provider in the US market.
• AcadiaHealth sees 40,000 patients daily in 194 facilities and 8,300 beds – wider relevance but our first target is their 2,100 Residential Recovery Facility beds which equates to a potential 25,000 users pa or around $2 million pa.
• Current pilot underway with Phoenix House which has 12 facilities, conducts 68,000 screening and assessment sessions.
Other large prospects among the dominant providers:
• Universal Health Services 216 facilities.
• Aurora Behavioural Health 13 facilities.
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3: Depression Treatment Test
• A milestone in psychiatry with publication of the First Test to predict Treatment Response in Depression – $100B pa sector.
• Clinically useful test which provides a recommendation for 96% people tested.• In the final stage of FDA submission and potential game changer for medication
prescription.
Escitalopram PPV NPV
Cross-validated value 61 77
Chance comparison 41 59
% improvement +49% +31%
Sertraline PPV NPV
Cross-validated value 43 87
Chance comparison 25 75
% improvement +72% +16%
Venlafaxine XR PPV NPV
Cross-validated value 46 81
Chance comparison 33 67
% improvement +39% +21%
http://www.dovepress.com/toward-an-online-cognitive-and-emotional-battery-to-predict-treatment--peer-reviewed-article-NDT 8
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Depression Treatment Test Workflow
Patient completes 40 minute online assessment
Clinician receives a Report within minutes, with recommendations to consider as part of the clinical workup
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Monetization target: 85M PCP visits pa
• Existing reimbursement codes (eg: CPT 96120 pays $90 average).
• Leverage current distribution relationships, conferences and online marketing.
• Extend to other markets in 2015 which do not require marketing approvals.
• Use of internal resources to implement the above and determine proof points.
• Hypothetical Depression Treatment Test clinical distribution model summary:
Model Summary (years from
date of approval)Year 1 Year 2 Year 3 Year 4 Year 5 Year 6
Total Depression Patients (m) 17.6 18.6 19.8 20.9 22.2 23.5
Addressable Market (m) 7.2 7.6 8.0 8.5 9.0 9.6
Total users of BRC test (m) 0.0 0.2 0.4 0.6 0.9 1.4
Share of addressable market 0% 3% 5% 8% 10% 15%
Total Revenues ($m) 5 27 49 73 100 154
EBITDA ($m) 3 14 24 36 49 74
EBITDA Margin 62% 50% 48% 49% 49% 48%
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Significant tailwinds from US health legislation
Healthcare reform and mental health parity has significantly increased sevice demand:
• 113 million impacted by the requirement to provide the same level of coverage for mental health as exists for physical health (Mental Health Parity and Addiction Equity Act). Important flow on benefit of making existing reimbursement codes more accessable to mental health services.
• 30 million previously uninsured to get coverage and Health Plans required to cover select preventative services at no charge (Depression screening and Alcohol misuse).
• Hitech Act - Incentives (and penalties) for adopting electronic health records that have ‘meaningful use’ (ie: decision support functionality).
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$50 million spent on development, platform and sales growth
Brain Resource Assets Development Total usage to date Users
Brain data acquisition and analysis software (EEG, MRI, Cognition)
30 years n/a 400 academic groups, 30 Pharma
Brain Resource International Database, standardized platform
14 years 225,000 datasets As above
Assessment 8 years 100,000 reports 150 active users
iSPOT $18m study 8 years 5,200 acquisitions
MyBrainSolutions.com 5 years 8,500,000 game plays77,000 MyBrain Assessments
120,000 users
10 Apps & Facebook games (iPad,Android, Facebook)
3 years 420,000 downloads
ADHD portal 2 years Pilot pilot
Clinical portal 2 years Newly launched
User journeys 1 year In development In development
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Brain Resource Cap Table
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Ordinary shares $
Total to 2006 incl 2001 IPO and Placements 15,521,478
Feb 13 Placement (30 cents per share) 1,000,000
Aug 13 Placement (30 cents per share) 2,000,000
Aug 14 Placement (25 cents per share) 7,027,500
Sep14 SPP (25 cents per share) 1,031,000
Total Equity Funds Raised to date ($) 26,579,978
Add: Och-Ziff Convertible equity (25cps)
Jun 11 Zero coupon Convertible Bonds (exp Jun 16) 10,000,000
Dec 11 Exchangeable Convertible Pref Shares 4,000,000
Total Funds raised 40,579,978$
Summary of Share Register # Ord Shares Undiluted
Och Ziff Managed Funds 25,616,651 19.1%
Spinite (High Net worth private) 16,711,311 12.5%
Evian Gordon (Founder, Chairman & CEO) 11,456,248 8.6%
Stuttgart (High Net worth private) 9,339,735 7.0%
Dan Segal (Founder, Director & COO) 6,359,264 4.7%
BRC Board members 1,902,239 1.4%
71,385,448 53.3%
Top 40 excluding the above 38,244,583 28.6%
Other (around 440 small shareholders) 24,318,423 18.2%
Total shares on issue (#) 133,948,454 100.0%
Potential shares CB, ECPS 56,000,000 43.0%
Total potential shares on issue (#) 189,948,454
• Cash at December 31, 2014 was $7.1 million.
ASX code: BRC / OTC code: BRRZY (ADR 5:1)
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Disclaimer
This Presentation is being furnished solely for the purpose of enabling prospective investors to determine whether they wish to proceed with further investigation of the Company. This Presentation is not intended to form the basis of any investment decision and does not attempt to present all the information that prospective investors may require for purposes of making an investment decision. The Company anticipates providing prospective investors with the opportunity to ask questions, receive answers, obtain additionalinformation and complete their own due diligence review concerning the Company prior to entering into any agreement relating to the purchase of securities from the Company.
All information included in this Presentation is submitted to you on a strictly and permanently confidential basis. Any reproduction or further distribution of this Presentation or any such information is prohibited. By accepting delivery of this Presentation, you agree that neither you nor any of your employees, agents or advisors will use this Presentation or any such information for any purpose other than evaluating the Company.
The Company shall not have any liability for any information included in this Presentation.
This Presentation speaks as of the date hereof. Nothing contained herein is, or should be relied upon as, a promise or representation as to future performance. The Company does not undertake any obligation to update or revise the Presentation.
This Presentation is intended solely for the use of the prospective investor to whom this Presentation is initially provided. This Presentation does not constitute an offer to sell to or solicitation of an offer to purchase from any investor or in any jurisdiction in which such an offer or solicitation is not authorized, would be unlawful or would constitute an offer to the public pursuant to the laws of such jurisdiction.
Any financial projections and other statements of anticipated future performance that are included in this Presentation are for illustrative purposes only and are based on assumptions by the Company’s management that are subject to significant risks and uncertainties and may prove to be incomplete or inaccurate. Actual results achieved may vary from our projections and the variations may be material. Variations in the assumptions underlying our projections may also significantly affect projected results.
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