BIOLASE Technology, Inc. Federico Pignatelli, CEO NASDAQ: BLTI www.biolase.com JMP Securities Healthcare Conference September 27-28, 2011, New York Exhibit 99.1 |
Safe Harbor Statement PAGE 2 This presentation may contain forward-looking statements that are based on our current expectations, estimates and projections about our industry as well as management’s beliefs and assumptions. Words such as “anticipates,” “expects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “may,” “will,” and variations of these words or similar expressions are intended to identify forward-looking statements. These statements include projections about our future earnings and margins and speak only as of the date hereof. Such statements are based upon the information available to us now and are subject to change. We will not necessarily inform you of such changes. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict. Therefore our actual results could differ materially and adversely from those expressed in any forward-looking statements as a result of various factors. The important factors which could cause actual results to differ materially from those in the forward-looking statements include, among others, a downturn or leveling off of demand for our products due to the availability and pricing of competing products and technologies, adverse international market or political conditions, a domestic economic recession, the volume and pricing of product sales, our ability to control costs, intellectual property disputes, the effects of natural disasters and other events beyond our control and other factors including those detailed in BIOLASE’s filings with the Securities and Exchange Commission including its prior filings on Form 10-K and 10-Q. |
BIOLASE is revolutionizing surgery by breaking the limitations of conventional dentistry and medicine. PAGE 3 New management is transforming BIOLASE from a one product, one segment company of the past to a multi-product and multi-segment platform company that will be better diversified in 2012 and beyond and better positioned for substantial growth compared to the “old” BIOLASE. In 2011, BIOLASE has better positioned itself product-wise due to the release of its revolutionary all-tissue WaterLase iPlus, which now equals the speed of a dental drill; the iLase, the first battery operated handheld diode laser; and the introduction of a full line of digital imaging devices. BIOLASE is expecting to launch several new and cutting edge laser products in 2012. BIOLASE is NOT Just Another Medical Equipment Company! |
Traditional Dentistry The painting Cavadenti, the Tooth Puller, by Caravaggio, circa 1608 PAGE 4 |
Years of engineering and research at BIOLASE led to the discovery that the Er,Cr:YSGG (2796nm) laser crystal (Erbium, Chromium doped Yttrium-Scandium-Gallium-Garnet) has the highest level of absorption in water molecules contained in human tissue. This absorption creates an expansion and vaporization of the water molecules causing a biological ablation of human tissue including teeth, dentin, bone, gum, skin and the eye). For example, tooth enamel contains up to 5% water, dentin and bone contain up to 25% water, soft tissue (gum tissue and skin) contains up to 80% water, and the eye contains up to 90% water. PAGE 5 Conventional Surgical Devices include the scalpel, high speed drill, electrosurge, electric bone saws, and heat generating lasers. How has BIOLASE Revolutionized Surgery? …through the science of WaterLase! |
Why BIOLASE WaterLase Technology in Dentistry? Traditional high-speed drills work by FRICTION which creates HEAT which causes PAIN. This PAIN necessitates injections of ANESTHESIA which results in PAIN and NUMB LIPS. In addition, the lack of feeling from the numbing injections can lead to THERMAL DAMAGE which can lead to PULPAL DEATH and result in a ROOT CANAL. The traditional high-speed drill also causes VIBRATION, which causes PAIN and leads to MICROFRACTURES. These MICROFRACTURES allow BACTERIA to penetrate the tooth which causes further DECAY and the FRACTURING of teeth. High speed drills also require the use of BURS which even after autoclaving have a 15% chance of carrying pathogenic micro-organisms. Needles and files can also carry bacteria. That means in traditional dentistry the patient has a 1 in 6 chance of cross contamination. WaterLase energy does not create heat or vibration so there is NO PAIN. Further, the WaterLase is bactericidal, antiviral and essentially eliminates the risk of cross contamination. PAGE 6 |
Alternative and Advanced Hi-Tech Dentistry Atraumatic Pediatric Tooth Extraction The aiming beam on the NEW WaterLase iPlus is green. This red beam featured in the previous generation of WaterLase products does not cut the tissue. Tissue is cut biologically, with water at the molecular level. Using BIOLASE WaterLase Systems, including our new WaterLase iPlus System: PAGE 7 The iPlus features an intuitive, touch-based computer screen, similar to a tablet personal computer. It is designed to allow for remote servicing and software upgrades. |
WaterLase High Speed Cutting PAGE 8 |
WaterLase vs. Drill PAGE 9 |
Alternative Dentistry is Less Frightening • There are 160,000 dentists currently serving a population of 300 million Americans which means that 75 million Americans are avoiding dental care because of fear. This equates to an average of 470 patients per dentist! • Patients spend about $1,000 per year on dental care, meaning that U.S. dentists are missing out on an average of $470,000 of potential revenue, every year. If a dentist that adopts painless WaterLase Technology realizes only half of this potential, they could earn an additional $235,000 in annual revenue by just serving fearful patients. PAGE 10 Using the dental drill offers more of the same which is pain, local anesthetic, swelling, pain killers, micro- fractures and cross contamination. WaterLase technology offers a biological solution with none of the downsides of traditional dentistry: NO drill, NO shot, NO pain, and NO cross contamination of bacteria or viruses. According to the ADA, nearly 25% of all Americans avoid dentists because they are afraid of dental drills and needles. |
WaterLase’s Amazing Return on Investment • WaterLase technology enables traditional dentists to perform procedures that they currently refer out to specialists or WaterLase dentists, for example: • Gingivectomy = $160 • Perio Treatment = $375 • Hard-tissue Crown Lengthening = $520 • Herpetic or Aphthous Ulcer = $308 • Frenectomy = $355 • This equates to $250-$750 per day in additional revenue • These procedures are easy to learn and training is included in the cost of the WaterLase. Monthly Lease Payment New Monthly Revenue Generated Approx. $1,000 $5,000 – $15,000 PAGE 11 A dentists’ return on investment can be between 500% and 1,500%! |
Substantial Data: • The effectiveness of dental lasers is proven and well researched. • Clinical data and peer- reviewed specialty journals substantiate the effectiveness of laser treatment in a wide variety of procedures. Technology Supported by Scientific Data PAGE 12 |
Some of the Dental Schools that are Teaching WaterLase Technology around the World PAGE 13 |
1. Dental Health Magazine 2. Dental Burs and Endodontic Files: Are Routine Sterilization Procedures Effective?: Archie Morrison, DDS, MS, FRCD(C); Susan Conrod, DDS JCDA • www.cda-adc.ca/jcda • February 2009, Vol. 75, No. 1. 3. Contaminated dental instruments: Smith A, Dickson M, Aitken J, Bagg J.J Hosp Infect. 2002 Jul;51(3):233-5. 4. The antimicrobial efficacy of the erbium, chromium: yttrium-scandium-gallium-garnet laser with radial emitting tips on root canal dentin walls infected with Enterococcus faecalis: Wanda Gordon, DMD, Vahid A. Atabakhsh, DDS, Fernando Meza, DMD, Aaron Doms, DDS, Roni Nissan, DMD, Ioana Rizoiu, MS and Roy H. Stevens, DDS, MS JADA 2007; 138(7): 992-1002. Warning: Patients Urged to Ask their Dentists About the Risk of Cross Contamination! Cross contamination is a huge threat 1,2,3,4 : • The CDC defines cross-contamination as the act of spreading bacteria and viruses from one surface to another. Blood-borne viruses have the ability to live on objects and surfaces for as long as a week. • Sterilization techniques used for the dental burs used with the high speed drill and endodontic files used in root canals are not effective. This is a serious health threat for many people. PAGE 14 |
NO Risk of Cross-Contamination: WaterLase MD™ reduced E. faecalis 2.86 times more effectively than NaOCl³ 1. Dental Burs and Endodontic Files: Are Routine Sterilization Procedures Effective?: Archie Morrison, DDS, MS, FRCD(C); Susan Conrod, DDS JCDA • www.cda-adc.ca/jcda • February 2009, Vol. 75, No. 1. 2. Contaminated dental instruments: Smith A, Dickson M, Aitken J, Bagg J.J Hosp Infect. 2002 Jul;51(3):233-5. 3. The antimicrobial efficacy of the erbium, chromium:yttrium-scandium-gallium-garnet laser with radial emitting tips on root canal dentin walls infected with Enterococcus faecalis: Wanda Gordon, DMD, Vahid A. Atabakhsh, DDS, Fernando Meza, DMD, Aaron Doms, DDS, Roni Nissan, DMD, Ioana Rizoiu, MS and Roy H. Stevens, DDS, MS JADA 2007; 138(7): 992-1002 Burs and Endo Files: • 15% of “sterilized” burs and up to 76% of “sterilized” endodontic files carry pathogenic micro-organisms. • Complex and rugged bur surface difficult to sterilize. • Autoclaving fails 15% of the time to decontaminate burs WaterLase Tips: • Smooth tip surface does not harbor debris or bacteria like abrasive surface of burs or files. • YSGG laser energy is bacteriacidal. • Single-use, disposable tips that work without the need to contact tissue. Also eliminates accidental sticks with contaminated burs. WaterLase Laser Technology Eliminates the Risk of Cross Contamination and Contagion PAGE 15 2 1, 3 1 |
Award winning IP: Recognized for innovation, leadership, and the development of numerous disruptive technologies, most notably the development of a new surgical system to cut human tissue in a biological and atraumatic way. Received Astrum Award at MDB Capital’s 2011 Bright Lights Conference. Strategy: Currently working with highly regarded IP consulting company to analyze our patent families and determine those with the greatest potential: – Dentistry (including new lasers for hard and soft tissue, a laser toothbrush, flavored water) – Ophthalmology (including procedures for presbyopia, glaucoma, maxillofacial surgery) – Orthopedics and pain management (including use as a general surgical knife) Internal development, licensing, and legal action against infringers. Intellectual Property PAGE 16 • • • • |
Current Status: BIOLASE currently has 279 issued and pending patents, 70% of which are related to our core Er;Cr:YSGG technology and medical lasers. Filing costs and maintenance are closely monitored. Funding for redundant patents and patents with a low- probability for issuance are stopped. Patent Portfolio Issued Pending Total U.S. 84 46 130 International 74 75 149 Total 158 122 279 PAGE 17 |
Current Line of BIOLASE Products All-tissue dental lasers: Our all-tissue lasers include our new flagship laser, the revolutionary WaterLase iPlus, and the WaterLase MD Turbo. Diode soft-tissue dental lasers: Our soft tissue lasers include the ezLase total diode solution, which offers power and portability, and the revolutionary iLase, a portable diode laser with no foot pedal, power cord, or external controls. Medical: The Diolase 10 offers high intensity laser therapy in the palm of your hand for pain management. Digital Imaging: We offer a full line of digital imaging equipment, including cone beam 3-D dental imaging and CAD/CAM digital dental impressions. PAGE 18 |
Patented laser toothbrush for Home Use • BIOLASE is currently developing a laser toothbrush for consumer home-use in connection with a license agreement with The Proctor and Gamble Company (“P&G”). • Research indicates that a laser toothbrush for home-use will whiten teeth, disinfect teeth and gums, bio- stimulate teeth and gums, relieve pain, and perform photodynamic therapy. • No other product currently on the market can perform all of these functions. New soft-tissue lasers • BIOLASE is also engineering a more powerful diode soft-tissue laser for launch in 2012 which will be the first offer multiple wavelengths and power up to 40 watts. Further Opportunities to Expand in Dentistry PAGE 19 |
With our patented WaterLase and diode technologies, we have created technological platforms that have the ability to extend far outside of dentistry. This expansion into new markets is a fundamental effort within BIOLASE. We expect to greatly expand our addressable markets in the coming years which, we believe, has the potential to substantially increase our revenues. Each of these potential markets represents a multi- billion dollar opportunity. Ophthalmology: We currently hold 13 issued and 20 pending U.S. and International patents in four patent families in the field of ophthalmology, giving us a wide range of applications and coverage. Our patented technology has the capability to restore the elasticity of the eye and allow it to return to normal function, eliminating presbyopia. Management has established a new subsidiary, OCULASE, which will own and develop BIOLASE’s ophthalmic assets and technologies. In 2012, we expect approval to market for glaucoma and dry eyes. We expect approval to market WaterLase technology for presbyopia internationally in 2013 and in the United States in 2014. Further Opportunities to Expand in Medicine PAGE 20 |
Pain Management: We anticipate launching a new deep-tissue hand piece and upgraded laser for pain therapy in 2012 which will coincide with a new marketing campaign. Podiatry: We have found that our Diolase 10 technology is very effective in the treatment of nail fungus and we are completing the clinical and regulatory requirements necessary to enter the market in 2012. Orthopedics: We are working with several key manufacturers and universities to provide solutions that are not currently available. We are investigating opportunities for several orthopedic applications and anticipate filing several 510(k) applications over the next 12 months. Aesthetics: We have various FDA approvals for applications in dermatology, plastic surgery, and oculoplastics and are currently investigating options for entering these markets in 2012. PAGE 21 Further Opportunities to Expand in Medicine (Continued) |
How BIOLASE is positioned for a successful turnaround: • BIOLASE has a better organizational structure, better cost control, and more efficient & effective • Our lower cost structure and growing direct sales force will allow us to leverage our earnings • The BIOLASE brand is currently known by over 80% of North American dentists and is growing • BIOLASE has the largest installed base of dental lasers which equates to recurring revenues from • BIOLASE has more products available than ever before. • BIOLASE has more clinical trials, more FDA approvals, and more patents and pending patents than Foundation for a Successful Recovery PAGE 22 management than ever before. compared to BIOLASE of the past. internationally. consumables, warranties, and service contracts. ever before. |
How BIOLASE is Positioned in the Dental Market BIOLASE United States BIOLASE International Total: 12,500 Total: 5,500 Grand Total: 18,000 2,800 2,700 5,700 6,800 PAGE 23 |
Owning BIOLASE Means Owning the Hard Tissue Dental Laser Market… Biolase 80% Source: Biolase Technology Licensing Reports PAGE 24 |
…and the Overall Dental Laser Market. 45% Source: iData Research Inc. 2009 US Dental Laser Market: Hard & Soft Tissue PAGE 25 Biolase |
Our Market Opportunity in Dentistry BIOLASE’s global market opportunity is tremendous! • 176,000 dentists in the US and Canada. 1 • Over 1.2 million dentists in 134 countries. 2 • 18,000 systems in over 11,000 practices. • Every 1% of further market penetration is equal to an opportunity of well over $600 million in revenues. Estimated total global market of 1,200,000, which is growing rapidly due to new markets such as China, India, and Indonesia. 18,000 3 systems sold worldwide. 1. American Dental Association. 2. World Federation of Dentistry. 3. 1998-present over 17,300 BIOLASE systems sold. PAGE 26 Our current market penetration is approximately 3% in the United States and slightly less than 1% internationally! |
Substantial Opportunity in Emerging Markets 1. World Federation of Dentistry Practicing Dentists PAGE 27 Western Europe 240,000 dentists 1 dentist / 1,800 population Eastern Europe 120,000 dentists 1 dentist / 4,000 population China 16,000 dentists 1 dentist / 82,300 population Japan 63,000 dentists 1 dentist / 2,000 population Rest of Asia 43,000 dentists 1 dentist / 14,000 population Middle East 19,000 dentists 1 dentist / 3,100 population India 35,000 dentists 1 dentist / 33,900 population Latin America 298,000 dentists 1 dentist / 5,600 population North America 176,000 dentists 1 dentist / 1,900 population Worldwide Total 1,200,000 dentists 1 |
Expected Growth of Emerging Markets PAGE 28 Emerging Markets are expected to be bigger than Developed Markets by 2050. 1,2 • Forecasts predict that the top 5 economies in 2050 will include China, the United States, India, Japan, and Germany. 1 • Led by China, at >800%, and India, at >600%, the rise in income per capita in the emerging world from 2010 to 2050 will dwarf that of the United States, at <100%. 1 • Other projected high growth emerging markets include Russia (575%), Indonesia (400%), and Brazil (200%). 1 1. Source: HBC Calculations; 2. Chart in Trillions of Constant US 2000 Dollars. |
BIOLASE Technology, Inc. Today Company Headquarters in Irvine, California PAGE 29 • We have over 170 employees worldwide. • We have sales offices in the U.S., Floss (Germany), Madrid (Spain), Shanghai (China), and Mumbai (India), with expansion planned in Dubai (UAE), and Rio de Janero (Brazil). We also have training facilities in Charlotte, NC, St. Louis, MO, and Irvine, CA. BIOLASE Europe in Floss, Germany BIOLASE is the Global Leader in Dental Lasers: • Our 57,000 sq. ft. fcorporate HQ in Irvine houses administrative, sales, marketing, customer care, training, manufacturing, and R&D. This facility can accommodate growth to $250 million. • We also have manufacturing capabilities in Floss, Germany. |
Operations • We are ISO 9001 certified and FDA GMP with clean room operations. We also have manufacturing capabilities in Floss, Germany. • Nearly 100% of our components and subassemblies are manufactured in our facility and/or the U.S. PAGE 30 • We have a highly skilled R&D team with extensive medical device and laser development expertise. We are highly focused in improving and extending our dental and medical product portfolio. Manufacturing and Research & Development |
0.5 1.0 Chart & Financial History 20 15 10 5 BLTI SHARE PRICE 1994-2006 Pignatelli Chairman of the Board Exclusive distribution partnership with Henry Schein Aug 2006–Aug 2010 Aug 2010-Present Pignatelli CEO & Board Chairman 1998 FDA Clearance WaterLase PAGE 31 |
Market Data (NASDAQ: BLTI) PAGE 32 As of September 15, 2011: Share price……………….....………………………...…………...................................................................... Shares issued and outstanding…………………………………………………………....….…………… Public float (shares held by others than the CEO and Board).……………………….....….………..… Average daily volume (three month average)……………………………………..……………….……...... Market capitalization……………………………………………………………......…..……………….. Percentage of shares held by institutional holders (at June 30, 2011)..…….................……. Short position……………………………………………………………………….…………………………. Dividend yield………………………………………………………………………………..…….…. 30,300,000 28,900,000 590,000 $106,900,000 approximately 57% 6,952,000 4% Annual Stock BIOLASE is currently covered by analysts from Needham & Company LLC, WJB Capital Group, and Rodman & Renshaw LLC and is part of both the Russell Global and Russell 2000 Indexes. $3.53 |
Financial Highlights PAGE 33 Turnaround: For the nine month period ended June 30, 2011, BIOLASE generated non-GAAP net income of approximately $885,000, as compared to a non-GAAP net loss of approximately $9.3 million for the nine month period ended June 30, 2010. Insider Purchases: During 2011, officers and directors have purchased approximately 109,700 shares of stock in the open market for approximately $440,000. In addition, officers and directors have converted approximately 523,000 options into shares of common stock. Employee Stakeholders: BIOLASE’s entire executive team holds options to purchase common stock. As of June 30, 2011, essentially all of our employees held 3,000,000 options. CEO Stakeholder: BIOLASE’s Chairman, President, and CEO, Federico Pignatelli, has an annual salary of one dollar. Mr. Pignatelli owns approximately 1.7 million shares of stock and 200,000 options to purchase common stock. The only way that Mr. Pignatelli will make money in 2011 is as a shareholder. |
Recent Developments Ophthalmology: In September In June 2011, BIOLASE entered into an agreement with Daniel S. Durrie, M.D., an internationally recognized refractive surgeon, to serve as BIOLASE’s primary ophthalmic expert resource and partner with management to oversee the development and execution of our clinical studies and consult on ophthalmic applications for our intellectual property portfolio. In September 2011, BIOLASE established a new subsidiary, OCULASE, which will own and develop BIOLASE’s ophthalmic assets and technologies. We expect approval to market for glaucoma and dry eyes in 2012 and approval to market WaterLase technology for presbyopia internationally in 2013 and in the United States in 2014. Asian Offices: In June 2011, BIOLASE officially opened BIOLASE Technology Asia Pacific, its Asian headquarters, in Shanghai, China, and a direct sales and service office, BIOLASE India Private Limited, in Mumbai, India. Digital Imaging Sales: At the end of the second quarter, BIOLASE received its first orders for its state of the art dental imaging devices for delivery in the third quarter. PAGE 34 |
Recent Developments (continued) Direct Sales in Germany: BIOLASE has regained the ability to sell direct or through other distributors from Henry Schein Inc. (NASDAQ: HSIC) for all of its international territories and has announced plans to expand BIOLASE Europe, GMBH, to now include a direct sales force, along with service and support operations, for the German market. Additions to the Management Team: BIOLASE has recently hired Richard Whipp as Director of Operations and Ehab Esmail as Vice President of Global Regulatory, Quality and Clinical Affairs. Private Placement: In June 2011, BIOLASE raised $9 million from institutional investors in a private placement through the sale of 1.6 million shares of common stock and 812,000 warrants. PAGE 35 |
BIOLASE Technology, Inc. Federico Pignatelli, CEO NASDAQ: BLTI www.biolase.com JMP Securities Healthcare Conference September 27-28, 2011, New York |