CLM - Bio2 Technologies, Inc.

April&2015&
A&BREAKTHROUGH&IN&ORTHOBIOMATERIALS&
• 
Bio2 has successfully applied a
proprietary process technology to
produce CLM!BG, a high performance
resorbable biomaterial for use in
musculoskeletal surgery.
• 
The Company is developing a pipeline
of products utilizing CLM!BG for
commonly performed surgical
procedures with established
reimbursement.
• 
Bio2 recently received its first FDA
market clearance and will launch an
implant for correction of adult
flatfoot deformity in Q3 2015.
CLM!BG'Scanning'Electron'Microscope'Image'
Fla$oot'Correc,on'Implant'
2&
Bio2&CLM!BG&OFFERS&SIGNIFICANT&COMPETITIVE&
ADVANTAGES&ACROSS&A&$1.8B&U.S.&MARKET&OPPORTUNITY&
Materials)Currently)in)
Use)
Clinical)Disadvantages)of)
Current)Materials)
Bio2)CLM!BG)Clinical)
Advancements)
Annual)U.S.)
Sales)
Cadaver'Bone&
AllograF&
Cultural&Aversion,&IntraoperaNve&
Structural&Weakness,&Disease&
Transmission&Risk&
&
NonSbiologic,&Consistent&
Structural&ProperNes,&
Reliable&Supply&Chain&
&
Ceramics'
Uncontrolled&Porosity,&Variable&
DissoluNon&
High&Strength,&Predictable& $288&Million&
ResorpNon&Profile,&
BioacNve&and&
OsteosNmulaNve&
Polymers'
Fibrous&EncapsulaNon&Prevents&
IntegraNon&with&Surrounding&
Bone,&Permanent&Foreign&Body&
Safe&ResorpNon,&
SNmulates&Bone&
Remodeling,&Facilitates&
Revision&
$986&Million&
Metals'
Impairment&of&PostSoperaNve&
Imaging,&Permanent&Foreign&
Body&
Safe&ResorpNon,&
SNmulates&Bone&
Remodeling,&Facilitates&
Revision,&No&Imaging&
Impairment&
&
$203&Million&
HydroxyapaNte,&&
TriSCalcium&Phosphate&
PEEK&
&
Titanium,&Tantalum&
$362&Million&
3&
CURRENT&MARKET&TRENDS&ARE&ACCELERATING&
DEMAND&FOR&Bio2’s&PLATFORM&TECHNOLOGY&
•  Increasing demand in emerging markets for advanced
biomaterials as the result of organic growth coupled with
cultural aversion to human tissue implantation.
•  The Asia-Pacific market for non-biologic biomaterials is
projected to double by 2022.
•  Increased regulation of cadaver tissue harvesting in the EU
has led to increased use of non-biologics.
•  Pronounced decrease in use of biologics as a result of
reported complications and associated litigation as well as
economic concerns.
•  Demographics and technology advances are driving double
digit growth in products for foot and ankle.
Sources: Knowledge Enterprises, Orthopedic Network News, Decision Resources Group
4&
THE&LEADERSHIP&TEAM&HAS&DEEP&INDUSTURY&
EXPERIENCE&
• 
• 
Paul Nichols
Janet Krevolin, PhD
Art O’Dea
President and CEO
Chief Technical Officer
VP Legal and RA
Founder and CEO of three
orthopedic surgery
technology companies with
successful exits
37 years of general
management experience
with rapidly growing
companies in the medical
device industry, 30 years in
orthopedics
• 
VP of Global Product
Development, VP European
Research Zimmer
• 
Over 25 years experience in
R&D in the orthopedic
surgery industry
• 
PhD Mechanical
Engineering University of
Texas
• 
VP of Intellectual Property
GEO2 Technologies
• 
Patent Counsel Cognex
Corporation
• 
JD Massachusetts School
of Law, BS Mechanical
Engineering University of
Vermont
5&
OUR&BOARD&OF&DIRECTORS&INCLUDES&RECOGNIZED&
INDUSTRY&LEADERS&
Paul K. Nichols, Jr. Chairman, President and CEO
Cheryl R. Blanchard, PhD Dr. Blanchard is the CEO of MicroCHIPS. Previously, she was Senior Vice
President and Chief Scientific Officer of Zimmer Holdings, Inc. Dr. Blanchard was also General Manager of
the Zimmer Biologics business, a venture business within Zimmer that she built through a combination of
internal R&D efforts and technology licensing/acquisition activities. Prior to joining Zimmer in October of
2000, Dr. Blanchard served in leadership roles at the Southwest Research Institute, the University of Texas
Health Science Center and the Oak Ridge National Laboratory. Dr. Blanchard also served as a Director of
ISTO Technologies, Inc and was the founding board chair of OrthoWorx
Donald W. Grimm Mr. Grimm retired from Eli Lilly & Company, a research-based pharmaceutical company, in
December 1993 after 23 years of service in various executive positions at Lilly. Following these assignments, Mr.
Grimm was President and CEO of Hybritech, Inc., a wholly owned subsidiary of Lilly. Mr. Grimm has been a director of
Hamilton BioVentures, LLC, a $100 million fund focused primarily on life sciences, since August 2001. In addition, he is
currently a director of several private life science companies and has served on the board of Life Technologies for
approximately 12 years.
Richard L. Intrater Mr. Intrater has been in the investment banking and financial services industry for over 30 years.
He is the President & CEO of Long-Term Solutions, a Multi-Family Office he founded in 2005 to assist multigenerational families of significant net worth with financial, investment, philanthropic and administrative oversight. He
also oversees LTS Capital Partner I and II which provides private equity investment capital to companies primarily in
the clean technology field. His previous experience includes a role as board member and managing director of Sand
Hill Advisors and the founder of Sutter Street Capital Management. Mr. Intrater spent 13 years as Senior Vice President
of Lehman Brothers in New York and San Francisco.
6&
OUR&BOARD&OF&DIRECTORS&INCLUDES&RECOGNIZED&
INDUSTRY&LEADERS&
Gary E. Jacobs Mr. Jacobs is the Managing Director of Jacobs Investment Company, which participates in real estate
development and other investment activities throughout the United States and abroad. In addition, he has multi-million
dollar investments in several other venture capital funds. Mr. Jacobs's philanthropic work includes being a past
president of the United Jewish Federation of San Diego County. Additionally, Mr. Jacobs and his wife created and
funded the Gary and Jerri-Ann Jacobs International Teen Leadership Institute which promotes Muslim / Jewish
understanding.
Douglas W. Kohrs Mr. Kohrs has over 30 years of experience in the medical device industry. He was
most recently President and CEO of Tornier N.V. a publicly traded orthopedics company and was
previously President and Chief Executive Officer of American Medical Systems Holdings, Inc., a publicly
held medical device company. Prior to joining AMS, Mr. Kohrs was General Manager of Sulzer Spine-Tech
Inc., an orthopedic implant manufacturer of which he was a founding member beginning. During the past
10 years, Mr. Kohrs has served on the board of directors of nine medical device companies, including ev3
Inc., acquired by Covidien Group S.a.r.l in 2010 and Kyphon, Inc., acquired by Medtronic, Inc. in 2007.
Debora LaBudde Ms. LaBudde is a founder of Envoi Ventures, a venture capital fund which makes investments in
seed and early stage life science and technology/IT companies. Earlier in her career, Ms. LaBudde was Director of
Business Development for Bausch & Lomb, Inc. where she was involved in over a dozen successful M&A and licensing
transactions representing more than $1.5 billion of aggregate value for the company.
Richard W. Mott, Strategic Advisor, is currently a principal in Walkabout Consulting LLC, a
management consulting and private equity firm. Mr. Mott most recently served as President, CEO and
Director of Kyphon Inc., a NASDAQ-listed global medical device company focused on minimally invasive
spinal therapies that was acquired by Medtronic, Inc. in 2007. Prior to Kyphon, Mr. Mott held several
executive positions at Wilson Greatbatch Technologies, Inc., most recently as CEO, as well as executive
operating roles within the Bristol-Myers Squibb Company. Mr. Mott is a recipient of the Ernst & Young
Entrepreneur of the Year Award and the Frost & Sullivan Technology Leadership of the Year Award.
7&
OUR&SCIENTIFIC&ADVISORS&ARE&CRITICAL&TO&OUR&
SUCCESS&
Thomas W. Bauer MD, PhD specializes in orthopaedic and gastrointestinal pathology. He holds joint
appointments at the Cleveland Clinic in the Institutes of Orthopaedics and Rheumatology as well as Spine,
and his research involves mostly orthopaedic biomaterials. He is considered an expert in the mechanisms
of success and failure of orthopaedic devices and he has published more than 225 manuscripts and book
chapters.
William M. Carty, PhD is Professor of Ceramic Engineering and Materials Science at the Center for Advanced Ceramic
Engineering at Alfred University. Dr. Carty’s work in ceramic processing has resulted in significant improvements in the
understanding of ceramic forming operations and defect elimination, microstructure control, and dramatic efficiencies in
commercial glass melting.
Avram A. Edidin PhD is the former Vice President of Scientific Affairs for the Spine and Biologics division of Medtronic.
He currently serves as an advisor/professor at Cornell and Drexel Universities.
David C. Greenspan, PhD is a respected senior biomaterials industry executive and technology expert with extensive
experience in bioactive glass. His work has focused primarily on the development of new bioceramic and composite
materials for bone, cartilage and soft tissue repair and regeneration. Dr. Greenspan holds 21 patents in the area of
bioactive glass and composites technology related to biomedical applications, and has co-authored 41 publications in
the field.
Gabriele Niederauer, PhD has over 20 years of experience in the study, development, and commercialization of
biomaterials for orthopedic, dental, and ENT tissue repair. She is currently the President and CEO of Bluegrass
Vascular Technologies, Inc. She previously served as VP of R&D at ENTrigue Surgical (acquired by Arthrocare in 2013)
and as Director of R&D at Osteobiologics, Inc.
Charles L. Saltzman, MD is the Chairman of the Department of Orthopaedics at the University
Orthopaedic Center of the University of Utah and specializes in surgery of the foot and ankle. He has
authored over 130 peer-reviewed publications, 30 book chapters, and co-edited three major textbooks
including Surgery of the Foot and Ankle. He is a past president of the American Orthopaedic Foot and
Ankle Society.
8&
PLATFORM)TECHNOLOGY)
THE&ORIGIN&OF&CROSSSLINKED&MICROSTRUCTURE&
TECHNOLOGY&
•  Fibrous ceramics were developed by Boeing for
the Space Shuttle program in the 1980’s. The
fibrous structure provided the shield tiles with
both strength (to withstand the loads experience
on re-entry) and porosity (to provide insulation
from extreme heat).
•  The shuttle tile inspired an entrepreneur and two
Boston Consulting Group consultants to form
GEO2 to use fibrous ceramics for particulate
filters for diesel truck emission control. The
Cross-Linked Microstructure (CLM) process was
ultimately licensed to Corning for the automotive
field in 2009.
•  Bio2 Technologies was formed in 2009 through a
spinout of the rights to practice CLM patents and
know how in the medical device field.
10&
CLM!BG&"&BIOACTIVE&|&RIGID&|RESORBABLE&
• 
Bio2 has applied its proprietary Cross Linked
Microstructure technology to bioactive glass
fiber to produce CLM!BG.
• 
Bioactive glass was first cleared by the FDA in
Jan 1985 and has a well studied mechanism of
action and proven osteostimulative benefits.
• 
The biochemical mechanism of action of
bioactive glass combined with CLM’s 3D
structure promotes remodeling of healthy bone
while safely and fully resorbing in the body (see
Appendix for illustration).
• 
The CLM process benefits include:
–  High compressive strength
–  Variable, interconnected porosity
–  Low manufacturing cost
–  Economically scalable and transferable
Approved products containing bioactive glass
CLM!BG))
NaGve)Bone)
11&
12&
CLM!BG&MECHANISM&OF&ACTION&
1&
2&
CLM!BG&has&both&micro&and&
macropores&that&are&
interconnected&which&allows&for&a&
large&surface&area&of&material&to&
interact&with&the&body.&Chemically&
CLM!BG&&contains&Silicon&(Si),&
Calcium&(Ca),&Phosphorus&(P)&and&
other&materials&
When&CLM!BG&is&&implanted,&a&chemical&
reacNon*&is&iniNated&between&the&
available&CLM!BG&surfaces&with&body&
fluids&which&modifies&the&surfaces&and&
afracts&the&body’s&own&bone&building&
cells&for&Nssue&regeneraNon.&(1000x&
magnificaNon)&
SchemaNc&of&bone&formaNon&
Bone)
3&
HydroxyapaNte&(HA)&formaNon&on&
CLM!BG&surfaces&(5000x&
magnificaNon).&Stem&cells&afach&to&HA&
and&differenNate&into&osteoblasts&
leading&to&generaNon&of&extracellular&
matrix&and&bone&formaNon&
Implant)
4&
Bone&formaNon&is&ongoing&in&
CLM!BG&&at&8&weeks&(140x)&
CLM!BG&PRESCLINICAL&EVIDENCE&INDICATES&
EXCEPTIONAL&PERFORMANCE&
Data'submiAed'to'the'FDA'confirmed'CLM!BG'bioac,vity,'
biocompa,bility'and'implant'resorp,on'in'concert'with'the'bone'
remodeling'process.'
Rabbit&Femur&Study&Performed&at&T3/Emory&University&
8&Weeks&PostSop&
No&evidence&of&
voids&
16&Weeks&PostSop&
A&substanNal&amount&of&new&bone&and&
bone&marrow&are&apparent&&
24&Weeks&PostSop&
IncorporaNon&of&the&residual&implant&material&
within&calcified&bone&is&apparent.&Healthy&bone&
formaNon&(arrows)&is&ongoing..&&
13&
OUR&IP&ESTATE&IS&BROAD&AND&MATURING&
• 
A patent landscape search identified white space in the prior art relating to bioactive
glass and a patent strategy was established to secure exclusivity on Bio2’s
innovations in the application of the CLM process to bioactive glass compositions.
• 
Patents identified in the early searches presenting potential obstacles to freedom to
operate were in-licensed royalty-free.
• 
Bio2’s wholly owned patent portfolio captures the application of the CLM process in
the field of implantable devices. Currently 7 US patents have issued with counterparts
issued in China, Japan, and Israel and additional pending applications worldwide.
• 
The patent portfolio covers methods and apparatus relating to the core technology
and characteristics of the CLM•BG material and CLM•BG implantable devices, with
the broadest claims capturing essential elements of the CLM•BG biomaterial:
–  Apparatus claims: bioactive glass fiber porous structure with pore space defined by pore
formers
–  Method claims: Mixing bioactive glass fiber, glass powder, binder and pore formers that are
sintered into a porous structure, using the pore former combustion to protect the thermally
sensitive bioactive glass composition
14&
PRODUCT)PIPELINE)
APPLICATIONS&FOR&CLM!BG&PRODUCTS&IN&THE&$45B&
MUSCULOSKELTAL&SURGERY&MARKET&
Surgeons'commonly'treat'pain'by'
performing'two'types'of'procedures'
that'can'u,lize'implants'constructed'
with'CLM!BG:&
Osteotomy&H'RestoraNon&of&
biomechanics&by&realigning&the&
bony&anatomy&
&
Fusion)–&EliminaNng&boneSonS
bone&arNculaNon&by&“welding”&
the&joint&
Cervical&Fusion&
Cranial&Maxillofacial&
ReconstrucNon&
Radial&Osteotomy&
Interphalangeal&Fusion&
Lumbar&Fusion&
Tibial&Osteotomy&
Mid,&Hind&and&Fore&
Foot&Osteotomies&
Ankle&Fusion&
Hammertoe&Fusion&
16&
OUR&INITIAL&PRODUCT&PIPELINE&TARGETS&TWO&
SUBSPECIALTY&VERTICALS&
ExtremiNes&(Hand&and&Foot)&
ReconstrucNon&
Flapoot&CorrecNon&Wedge&
Interbody&Devices&for&Spinal&Fusion&
Lumbar&Fusion&IBD&
Hammertoe&Fusion&Device&
Cervical&Fusion&IBD&
Strategic Rationale
Strategic Rationale
• 
Low development risk and expense
• 
Transformational potential in a $1B market space
• 
Fast pathway to first-in-human and revenue
• 
Compelling economic and efficiency benefits
• 
Predicate for IBD applications
• 
The $1.5B extremities segment has double digit
growth and much recent M&A activity
CLM!BG Value Proposition
Problem: Commonly used allograft (cadaver bone) has
supply challenges and cultural aversion in EU and AsiaPacific markets.
Solution: Procedure specific implants with superior
biological and mechanical properties compared to
allograft and other synthetic bone substitute.
CLM!BG Value Proposition
Problem: Current standard of care utilizes plastic
spacers that elicit fibrous encapsulation and may require
an additional surgical procedure to harvest bone graft to
achieve fusion.
Solution: Interbody devices constructed from a
resorbable, osteostimulative material resulting in a
fusion consisting exclusively of native bone.
17&
EXTREMITIES&PRODUCTS&COMMERCIALIZATION&
TIME&LINE&
18&
Extremities Distribution
Partner Agreement
Production Process
Validations
Rabbit Ingrowth
Study
Midfoot
Wedges FDA
510(k)
Limited
Release - US
Approved&12/18/14&
Radial
Wedge
FDA 510(k)
Limited
Release - US
Hammertoe
Fusion
FDA 510(k)
2014
2015
National
Release - US
National
Release - US
National
Release - US
Limited
Release - US
2016
2017
2018
CLM!BG&INTERBODY&DEVICE&&
COMPETITVE&VALUE&PROPOSITON&
19&
Bio2’s'CLM!BG'Interbody'Device'is'posi,oned'to'compete'in'mul,ple'commercially'
aArac,ve'posi,ons'across'the'IBD'market.'
IBD)Market)Share)by)Material)in)2013)
PEEK& Metal& Bone&
US)Sales)in)millions)
$1,400&
$1,200&
$322)
$1,000&
$98)
1
Replace)machined)bone)IBDs))
Value)ProposiGon:)Improved'material'proper,es'
and'usability'
2
$800&
Replace)all)IBDs)for)a)subset)of)paGents)with)
historically)low)fusion)rates)(e.g.,)smokers,)older,)
osteoporoGc)people))'
Value)ProposiGon:'Enhanced'outcomes'for'targeted'
market'
$600&
$966)
3
$400&
$200&
$0&
Sources:'Back'Bay'Analysis,'ONN'2013'Spinal'Surgery'Update'
Source: 2013 Orthopedic Network News
Spine Update and Company Estimates
Replace)PEEK)IBDs)'
Value)ProposiGon:'Ideal,'boneHlike'material'proper,es'
coupled'with'resorbability'and'concomitant'
osteo”s,mula,on”'
SPINAL&FUSION&COMMERCIALIZATION&TIME&LINE&
Distribution Agreement –
US Partner
Ovine (Load-Bearing)
Cervical Fusion Study
Cervical IBD
CE Mark (EU)
Application
100 pt EU Clinical
Trial
Distribution Agreement –
EU Partner
Ovine (Load-Bearing)
Lumbar Fusion Study
2015
2016
Lumbar IBD
CE Mark (EU)
Application
Cervical IBD
510(k)
Application
Limited
Release - EU
100 pt EU Clinical
Trial
2017
Limited Release US
Lumbar IBD
510(k) + Data
2018
20&
COMMERCIAL)STRATEGY)AND)
BUSINESS)MODEL)
SHAREHOLDER&VALUE&CREATION&STRATEGY&
IRR Optimized via Minimizing Investment in Commercial Infrastructure:
•  Development of product pipelines utilizing the Company’s
proprietary platform technology
•  Generation of evidence to secure market clearances in key global
jurisdictions and support early clinical adoption
•  Commercial viability demonstrated through marketing partnerships
with established subspecialty distributors with existing hospital,
surgery center and surgeon relationships
•  Value monetized through asset sales to strategic market leaders
22&
MOST&PRODUCTION&PROCESSES&OUTSOURCED&TO&
ACCESS&SCALE&AND&MINIMIZE&CAPITAL&NEED&
Proprietary CLM production process performed in-house, all other
steps performed by qualified vendors
@&Bio2&
BioacNve&Glass&
Raw&Material&
Formulated&
to&Bio2&Spec&
Fiber&
Drawing&
CLM!BG&
Material&
ProducNon&
Implant&
Machining&
Packaging&
and&
SterilizaNon&
23&
PRODUCTS&WILL&BE&SOLD&TO&SUBSPECIALTY&
VERTICALS&THROUGH&PARTNERS&&
24&
•  Marketing Partnership Economics
#  Transfer Price + Royalty on Net Selling Price
#  Minimum Stocking Order and Annual Purchases to Retain Exclusivity
•  Example - Cotton Osteotomy Wedge
Partner&Gross&Margin&
&Bio2&Royalty&
Bio2&Gross&Margin&
Transfer&Price&
to&Partner&
&Bio2&&
Manufacturing&Cost&&
&Partner&
Commission&Expense&
&Partner&COGS&
Average&
Selling&Price&&
CORPORATE)FINANCE)
Please&contact&Bio2&for&Corporate&Finance&details&
26&
IN&SUMMARY&–&INVESTOR&HIGHLIGHTS&
First successful use
of bioactive glass
as a load bearing,
resorbable 3-D
structure for Ortho /
Spine implants
510(k) regulatory
pathway and preexisting
reimbursement
codes for initial
product
applications
Significant clinical
and economic
benefits when
compared to the
current standard of
care
Broad array of
applications for the
large and growing
$41.3 billion
Musculoskeletal
Surgery market
Commercial
launch of initial
application in
Q3 2015
Broad IP
portfolio
Supported by very
experienced Board
of Directors
Experienced
management team
led by Paul Nichols
and Janet Krevolin,
Ph.D.
Contact:&&Paul&Nichols&|&+1&619&997&0103&|&[email protected]&|&www.bio2tech.com&