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N AC H U M “ H O MI ” S H A MI R P R E S I D E N T A N D C H I E F E X E C U T I V E O F F I C E R
J E F F E R I E S 2 0 1 5 G LO B A L H E A LT H C A R E C O N F E R E N C E J U N E 3 , 2 0 1 5
SAFE HARBOR STATEMENT
2 | © Copyright 2015 Luminex Corporation | Breakthrough solutions to improve health and advance science
Certa in statements made dur ing the course o f th is presentat io n may not be purely h istor ica l and conseque nt l y may be forward lo o k ing statements with in the meaning o f the Pr ivate Secur i t i es L i t igat ion Reform Act o f 1995, inc ludi n g but not l imite d to statements made regardin g: o ur partner model and the abi l i ty o f our partners and insta l le d base to dr ive future gro wth; the abi l i ty o f o ur techno lo gy to enhance product iv i t y and ef f ic iency; our f inanc ia l pos i t ion and long-term revenue growth; our molecular d iagno st ic bus ines s model , the markets we are target ing, market segmentat io n, expected growth o f such markets , and the abi l i ty o f o ur products to address tho se markets ; sa les o f our products , thei r technica l capabi l i t i es , and the ant ic ipate d market s i ze and acceptance, demand and regulatory env i ro nm e nt and approva ls therefor ; our d i rect sa les ef forts ; our system placement s; o ur system and assay product p ipel i n e and ant ic ipated t imel i n es for regulatory approva ls and market re leases , inc ludi n g for ARIES instrum e ntat io n and assays; market opportuni ty for ARIES and NxTAG RPP product ; funct iona l i t y and benef i t s o f ARIES and NxTAG RPP and compet i t i v e po s i t io n; re imbu rs e me n t t rends; develop me n t and growth o f our PGx strategy , our abi l i ty to dr ive growth thro ugh investm e nt in R&D and focus on o perat ing leverage and managing operat ing costs ; our long term f inanc ia l targets ; our key steps and strategies fo r gro wth; o ur st rateg ic o ut look and growth p lan for our bus ines s fo r 2015 and beyo nd; operat iona l t rends, inc ludi n g tho se re lated to sa les o f systems, assays , consumables , and roya l ty revenue s; compet i t iv e threats and products o f fered by o ther companies; 2014 revenue guidance; o ur bus ines s out look, f inanc ia l targets and pro ject ions about revenu es, cash f low, system shipme nt s , expense s and market condit io ns , and their ant ic ipate d impact on L uminex for 2015 and beyo nd; and, any statement s o f the p lans , s t rategie s and object ives o f managemen t for future operat ions. These forward look ing statements speak o nly as o f the date hereof and are based on our current bel iefs and expectat ions and are subject to known o r unknown r i sks and uncerta int i es so me of which are beyond o ur co ntro l that co uld cause actua l resul ts or p lans to d i f fer mater ia l l y and adverse l y f rom those ant ic ipated in the forward loo k ing statements . Factors that could cause or contr ibute to such d i f ferenc es are deta i le d in our annual , quarter l y , o r o ther f i l ing s with the Secur i t ie s and Exchange Commiss ion. We undertake no obl igat io n to update these forward lo ok ing statements . A lso , certa in non-GAAP f inanc ia l measures as def ined by SEC Regulat io n G, may be covered in th is presentat io n. To the extent that any no n-GAAP f inanc ia l measures are covered, a presentat io n o f and reconc i l ia t io n to the mo st d i rect ly comparable GAAP f inanc ia l measures wi l l be inc lude d in th is presentat ion may be ava i lable on our websi te at www. luminexcor p.com in accordance with Regulat ion G.
OUR BUSINESS
3 | © Copyright 2015 Luminex Corporation | Breakthrough solutions to improve health and advance science
A Foundation Built on Multiplexing - From only one sample, detect and identify up to 500
biological agents - Improves time, cost, and productivity - Distributed by key industry players
Growing Focus on Molecular Diagnostics - Expanding product portfolio with the launch of new,
innovative products - Moving downstream into large, adjacent markets - Direct salesforce
Shifting the Company into a Diagnostics Business
Partnership Channel
Direct Sales
Channel
Accelerating the Transformation into a Diagnostics Business
LMNX
PARTNERSHIP CHANNEL FUNDING GROWTH IN MOLECULAR CHANNEL
4 | © Copyright 2015 Luminex Corporation | Breakthrough solutions to improve health and advance science
Stable, Strong & Profitable Partnership Channel
- 2014 Revenue: ~$117M - 1Q15 Royalty Revenue: ~$11M (+6% Y/Y) - Growth Expectations: mid-single digits - Annualized end-user sales approaching
$500M for 2015
Molecular Diagnostics Drives Future Growth
- 2014 Revenue: ~$88M (+18% Y/Y) - 1Q15 Revenue: ~$25M (+17% Y/Y)
- Significant growth in PGx and infectious disease portfolio
- On Track for ~$100M+ in Assays in 2015
[1] 4-year CAGR based on 2014 revenue over 2010
0
50
100
150
2010 2011 2012 2013 2014
$(M)
Systems Consumables Royalties
0
20
40
60
80
100
2010 2011 2012 2013 2014
$(M)
Assays
CAGR = 5% [1]
CAGR = 28% [1]
POSITIONED FOR ACCELERATING GROWTH
5 | © Copyright 2015 Luminex Corporation | Breakthrough solutions to improve health and advance science
ATTRACTIVE Markets Leadership position in growing multibillion dollar markets with
multiple revenue streams
DIFFERENTIATED Technology
Solution-based product innovation to Lab customers
NEW PRODUCT Launches NxTAG™ RPP
ARIES™
FINANCIAL Leverage Strong gross margins
& profitability
THE ESTABLISHED LEADER IN MULTIPLEX TESTING
6 | © Copyright 2015 Luminex Corporation | Breakthrough solutions to improve health and advance science
Detect and identify up to 500 biological agents • Save time • Decrease cost • Increase productivity
11,200+ Instruments
placed
700+ Assays
Developed
65 IVDs Clearances on
Luminex Technology
325+ Issued Patents
Worldwide
More than 22,000 published scientific studies
cite Luminex technology and/or partner products
RUO Launched
NXTAG™ RPP TIMELINE PROGRESSING TOWARDS COMMERCIAL LAUNCH
Started Clinical Trials
2Q15 Summer 15E
FDA 510(k) Submission
4Q15E
Target Date for FDA Clearance
7 | © Copyright 2015 Luminex Corporation | Breakthrough solutions to improve health and advance science
1Q15
NXTAG™ RESPIRATORY PATHOGEN PANEL (RPP) SCALABLE SOLUTION FOR STREAMLINED RESPIRATORY TESTING
8 | © Copyright 2015 Luminex Corporation | Breakthrough solutions to improve health and advance science
• Many pathogens present with similar symptoms
• Labs are busy and may be understaffed
• Require quick results, even during peak seasons
• Post-PCR contamination can cause false results
• Seasonal demand
Challenges for Labs NxTAG Solution • Single-well assay, 22 pathogens,
comprehensive coverage • Simplified workflow, minimal
hands-on time • Results on up to 96 samples
in ~4 hours
• Closed-tube workflow reduces contamination risk
• Scalable throughput: from
1-96 samples at a time
Completed Development
ARIES™ TIMELINE ADVANCING TOWARDS COMMERCIAL LAUNCH
Started Clinical Trials
2H14 1Q15 Summer 15E
FDA 510(k) Submission/ RUO Launch
4Q15E
Target Date for FDA Clearance
5+ Assays Cleared
2Q16E
9 | © Copyright 2015 Luminex Corporation | Breakthrough solutions to improve health and advance science
Commercial Launch
HSV 1/2 Completed
C. Diff Ongoing
20 systems placed across 10 customer sites
~20 systems placed across 10 customer sites
ARIES™: SOLUTION-BASED PRODUCT INNOVATION
10 | © Copyright 2015 Luminex Corporation | Breakthrough solutions to improve health and advance science
• Contamination and Misdiagnosis
• Varying Testing
Platforms • Scarcity of Personnel
(i.e. Lab Technicians) • High Volume of Reports
• Limited Bench Space
Challenges for Labs ARIES Solution
• Sample-to-Answer, Minimizes User Error
• Compelling Menu Strategy (i.e. Rapid Menu Expansion)
• True Walkaway
Capability • Streamlined Reporting
• Minimal Footprint –
15” Bench Space
LUMINEX CURRENT MDx PORTFOLIO
11 | © Copyright 2015 Luminex Corporation | Breakthrough solutions to improve health and advance science
INFECTIOUS DISEASES
PRODUCTS
GENETICS
PRODUCTS
Respiratory
Gastrointestinal
xTAG® RVP xTAG® RVP Fast
xTAG® GPP
Women’s Health MultiCode® HSV 1/2 Cystic Fibrosis
Pharmacogenetics (Personalized Medicine)
xTAG® CF
xTAG® CYP2D6 xTAG® CYP2C19
MARKETS PRODUCTS MARKETS
Portfolio Performance
2014: ~$88M (+18% Y/Y)
1Q15: ~$25M (+17% Y/Y)
On Track for ~$100M+ in 2015
Total Addressable Market = ~500M
Source: Market Diagnostics International (MDxi), 2013 EMMES and internal estimates
I
AR ES
Full MDx (500)
Moderately Complex MDx
(1000)
Limited MDx (5,000)
No MDx Capability (7,000)
INCREMENTAL MARKET OPPORTUNITY EXPANDING DOWNSTREAM WITH ARIES™
Source: Mdxi Market Diagnostics Int’l, 2013 Emmes: 1,000 U.S. laboratory survey, Scientia Analysis, AHA Registered U.S. Hospitals, CMS CLIA
12 | © Copyright 2015 Luminex Corporation | Breakthrough solutions to improve health and advance science
Luminex 2015 and Beyond Key Positioning
• Access to Attractive, Fast Growing Markets Segments
• Simple, Easy to Use Solutions Drive Adoption
• Offering Complete Testing Solution:
- xTAG® / NxTAG™ RPP (High Multiplex)
- ARIES™ (Real-time PCR)
xTAG NxTAG
Current MDx TAM: ~$500M
MDx TAM with ARIES:
$1.5B+
ARIES™ COMMERCIAL LAUNCH PROGRESS
13 | © Copyright 2015 Luminex Corporation | Breakthrough solutions to improve health and advance science
CUSTOMER ENGAGEMENT • Early Access Program • Clinical Whitepapers • Time in Motion studies • Engaging with KOL’s
REGULATORY • Initiated HSV and C. Diff
Clinical Trials
• On track for FDA submission in Summer ’15
SALESFORCE EXPANSION • ~10 Additional Headcount
• Goal: Strategically position for maximum coverage
• Integrated salesforce
SCALE UP OPERATIONS • Invested in semi-
automation equipment
• R&D resource allocation
ARIES
ARIES™ VISION FOR THE FUTURE LEVERAGING OUR MULTIPLEXING HERITAGE
14 | © Copyright 2015 Luminex Corporation | Breakthrough solutions to improve health and advance science
Multiplexing & RT-PCR
Building a Platform for Sustainable Growth
Additional Plex
Capabilities
Menu Expansion
50
100
150
200
250
2010 2011 2012 2013 2014 2015E
Total Revenue
($M)
CONSISTENT TOP-LINE GROWTH
[1] 5-year CAGR based on mid-point of 2015 guidance range over 2010 [2] 2015 revenue guidance as of 1Q15 earnings call, May 4, 2015
15 | © Copyright 2015 Luminex Corporation | Breakthrough solutions to improve health and advance science
2015 Guidance of $230M - $236M [2]
“Expectation above mid-point of range”
[1] Non-GAAP Operating margin for years 2010-2015 exclude litigation fees, restructuring, severance, and settlement of distributor agreements
STRONG GROSS AND OPERATING MARGINS
16 | © Copyright 2015 Luminex Corporation | Breakthrough solutions to improve health and advance science
0%
4%
8%
12%
16%
20%
2010 2011 2012 2013 2014 1Q15YTD
Non-GAAP Operating Margin [1]
Highlights Industry Leading Gross
Margins Significant Operating
Leverage & Profitability - 1Q15 EPS: $0.18 Strong Free Cash Flow
- No Debt - ~$111M in Cash and
Investments at March 31, 2015
Gross Margin: 68% 68% 70% 67% 70% 70%
EXCITING FUTURE AHEAD
17 | © Copyright 2015 Luminex Corporation | Breakthrough solutions to improve health and advance science
• Utilize brand recognition and reputation while expanding addressable market
• Offer a complete testing solution
• Focus on execution, organizational synergy and becoming market driven
• Leverage a strong balance sheet
• Growing emphasis on diagnostics
THANK YOU