Investor PresentationPreliminary financial results through December 2011
Safe Harbor StatementThis presentation may contain forward-looking statements regarding future events or thefuture financi...
Introduction | Company Details Founded:                       August 2007 Headquarters:                  Florence, KY S...
Introduction | Our MissionBuild the most efficient delivery system for cash paying prescriptionconsumers                  ...
Industry Trends | Why HealthWarehouse.com?The traditional retail pharmacy model doesn’t fulfill customer requirements     ...
Industry Trends | Current Landscape                                 Retail                                                ...
Industry Trends | Current Landscape (continued)Sales breakdown of select major US pharmacies – CY2011Pharmacy             ...
Industry Trends | Current Landscape (continued)Several brands have become obsolete by not changing their business models
Industry Trends | Name-Brand Medications Moving to GenericsApproximately $212 billion in name-brand medications will have ...
Industry Trends | Lipitor Case StudyLipitor once sold for $150…        Rent                            No significant in...
Industry Trends | Change in Retail PharmacyPharmacies have shifted a significant portion of their revenue stream awayfrom ...
Corporate Overview | AccreditationHealthWarehouse is among the few pharmacies that have VIPPS accreditation
Corporate Overview | Sources of Customer Acquisition             Direct                                    Indirect       ...
Corporate Overview | Sources of Customer Acquisition (continued)       Elderly                 Convenience                ...
Corporate Overview | Simplifying the Channel      Current Supply Chain                 HealthWarehouse Model          Manu...
Corporate Overview | Sample Cost Savings – Cash PriceHealthWarehouse delivers significant savings across a variety of pres...
Corporate Overview | DeliveryHealthWarehouse offers a quick delivery time from the company’sheadquarters                  ...
Corporate Overview | Strong Customer ServiceHealthWarehouse consistently ranks highly in third-party customer service rati...
Corporate Overview | Leading Technology in Industry – Pharmacy Fax ManagerTO COME
Corporate Overview | Platform’s Ease of Use – Pharmacy Refill ManagerTO COME
Growth Strategy | Current OpportunitiesHealthWarehouse is a disruptive business model that is poised to benefitfrom changi...
Growth Strategy | Current Opportunities (continued)      Further Enhance Portal         Increase traffic:              ...
Financial Summary | Annual Financial ResultsUSD                    2008            2009           2010            2011Reve...
Financial Summary | Key Annual Statistics                      2008            2009            2010            2011Orders ...
Financial Summary | Revenue and Prescription Growth   HealthWarehouse continues to grow both its revenue and customer base...
Financial Summary | Prescription Growth – New and RefillsRefills continue to comprise a larger share of prescriptions     ...
Financial Summary | Investor AppealHealthWarehouse is the only nationwide, online, mail-order pharmacy withsignificant bar...
Thank You          7107 Industrial Rd         Florence, KY 41042        TEL: 1-866-885-0508 http://www.HealthWarehouse.com
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HealthWarehouse.com Investor Presentation

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HealthWarehouse.com Investor Presentation

  1. 1. Investor PresentationPreliminary financial results through December 2011
  2. 2. Safe Harbor StatementThis presentation may contain forward-looking statements regarding future events or thefuture financial and operational performance of HealthWarehouse.com. Words such as“targets,” “expects,” “believes,” “anticipates,” “intends,” “may,” “will,” “plan,” “continue,”“forecast,” “remains,” “would,” “should,” “projected,” “focus” and similar expressions areintended to identify forward-looking statements. Forward-looking statements are based oncurrent expectations, are not guarantees of future performance and involve assumptions,risks, and uncertainties. Actual performance may differ materially from those contained orimplied in such forward-looking statements. Risks and uncertainties that could lead to suchdifferences could include, among other things: effects of changes in the economy; changesin consumer spending; fluctuations in the stock market; changes affecting the Internet,online retailing and advertising; difficulties establishing our brand and building a criticalmass of customers; the unpredictability of future revenues and expenses and potentialfluctuations in revenues and operating results; risks related to business combinations andstrategic alliances; possible tax liabilities relating to the collection of sales tax; consumertrends; the level of competition; seasonality; the timing and success of expansion efforts;changes in senior management; risks related to systems interruptions; possiblegovernmental regulation; and the ability to management a growing business. Additionalinformation regarding factors that potentially could affect our business, financial conditionand operating results is included in our periodic filings with the SEC on our Annual Reportson Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. Forward-looking statements represent our views as of today and we expressly disclaim any intent orobligation to update any forward-looking statement.
  3. 3. Introduction | Company Details Founded: August 2007 Headquarters: Florence, KY Stock Symbol: HEWA Employees: 65 Licenses: 50 States + DC Certifications: DEA Awards:
  4. 4. Introduction | Our MissionBuild the most efficient delivery system for cash paying prescriptionconsumers Other Cash Generic Rx Pet Rx Platforms
  5. 5. Industry Trends | Why HealthWarehouse.com?The traditional retail pharmacy model doesn’t fulfill customer requirements Costly Inconvenient Unpleasant
  6. 6. Industry Trends | Current Landscape Retail Prescriptions OTC Business to Business Only Mail-Order
  7. 7. Industry Trends | Current Landscape (continued)Sales breakdown of select major US pharmacies – CY2011Pharmacy ℞ Sales1 Internet ℞ Cash ℞ 3rd Party Generic ℞Walgreens $46,700 1% 3% 96% 74%CVS Caremark 40,700 1% 1% 98% 76%Rite Aid 17,800 0% 2% 97% 76%Walmart 15,900 2% 20% 70% 65%Kroger 7,200 1% 25% 65% 50%Safeway 3,900 1% 10% 80% 50%Target 3,400 2% 25% 70% 50%Kmart 2,300 1% 30% 60% 50%Supervalu 2,200 1% 10% 80% 50%Costco 1,540 1% 25% 45% 70%HealthWarehouse 10.4 100% 83% 17% 95%Source: Company info, DrugStoreNews.comNote:1. In USD millions
  8. 8. Industry Trends | Current Landscape (continued)Several brands have become obsolete by not changing their business models
  9. 9. Industry Trends | Name-Brand Medications Moving to GenericsApproximately $212 billion in name-brand medications will have becomegeneric by 2015 28.3 Plavix® Seroquel® Singulair® Actos® Lexapro® Diovan® 13.8 13.5 Diovan HCT® 13.8 12.6 Tricor® Prevacid® Lipitor®(1) Lidodem® Nexium® 9.8 Effexor XR® Topamax® Zyprexa® Viagra® Celebrex® Flomax® 6.9 Valtrex® Levaquin® Proair HFA® Abilify® Aricept® Adderall XR® Cozaar® Cymbalta® Hyzaar® Aciphex® Lovenox® 2009 2010 2011 2012 2013E 2014E 2015ESource: Company infoNote:1. Lipitor was initially released November 2011, with a broader release in May 2012
  10. 10. Industry Trends | Lipitor Case StudyLipitor once sold for $150…  Rent  No significant increase in  Inventory overhead to sell  Employees nationwide  $7 million to open  10 mile radius Retail pharmacy needs 10x generic Lipitor prescriptions in a 10 mile radius of store to cover current costs …its generic version now sells for $15 at HealthWarehouse
  11. 11. Industry Trends | Change in Retail PharmacyPharmacies have shifted a significant portion of their revenue stream awayfrom prescription medications Beer & Wine Cafés Groceries
  12. 12. Corporate Overview | AccreditationHealthWarehouse is among the few pharmacies that have VIPPS accreditation
  13. 13. Corporate Overview | Sources of Customer Acquisition Direct Indirect Search Engines Insurance / Employers Social Media Primary Care Clinic Groups
  14. 14. Corporate Overview | Sources of Customer Acquisition (continued) Elderly Convenience Medicare “Donut Hole” Chronic Younger Uninsured / Conditions Generation Under-Insured
  15. 15. Corporate Overview | Simplifying the Channel Current Supply Chain HealthWarehouse Model Manufacturer Manufacturer Wholesaler Distributor Pharmacy Consumer Consumer Cost paid by Consumer, Savings to Consumer, Employer, Insurance Employer, Insurance
  16. 16. Corporate Overview | Sample Cost Savings – Cash PriceHealthWarehouse delivers significant savings across a variety of prescriptionmedications without insurance, discount cards, or coupons Drug QTY HW CVS Walgreens Actos 15mg 30 $178.00 $197.49 $203.49 Amlodipine 2.5mg 30 $3.50 $38.84 $41.49 Atorvastatin 10mg 30 $14.00 $137.49 $113.49 Benicar 5mg 30 $79.00 $85.51 $92.19 Diovan 40mg 30 $85.00 $93.11 $113.49 Simvastatin 40mg 30 $3.50 $52.49 $43.99 Sumatriptan Succinate 100mg 9 $21.00 $157.49 $199.99 Tamsulosin HCL 0.4mg 30 $18.00 $95.49 $108.99 Valacyclovir 1000mg 30 $80.00 $209.20 $209.20 Zolpidem Tartrate 10mg 30 $10.00 $49.16 $51.99Source: Company info and GoodRx as of June 2012 – San Francisco, CA pricing
  17. 17. Corporate Overview | DeliveryHealthWarehouse offers a quick delivery time from the company’sheadquarters Cincinnati, OH 80% of US population reached in 2 days
  18. 18. Corporate Overview | Strong Customer ServiceHealthWarehouse consistently ranks highly in third-party customer service ratings Customer Service Ratings 1 5.0 Number of Stars 4.5 4.0 3.5Source: Google Product Search as of June 2012Note:1. Based on reviews on various sources compiled by Google
  19. 19. Corporate Overview | Leading Technology in Industry – Pharmacy Fax ManagerTO COME
  20. 20. Corporate Overview | Platform’s Ease of Use – Pharmacy Refill ManagerTO COME
  21. 21. Growth Strategy | Current OpportunitiesHealthWarehouse is a disruptive business model that is poised to benefitfrom changing market dynamics within the prescription medication industry  Disruptive business model  Eliminate inefficiencies in drug distribution  Provide consumers drug price transparency  $212B brands off patent in 5 years  By 2015, 94% of drugs sold will be cash generics  Bring consumers affordable medications  Low overhead  Fast shipping  Award-winning customer service
  22. 22. Growth Strategy | Current Opportunities (continued)  Further Enhance Portal  Increase traffic:  Content - Similar to WebMD  Community - Web 2.0, Facebook, Twitter  Search Engines – Google, Yahoo & Bing - VIPPS  Increase stickiness:  Monitoring – Online Health Management  Mobile – Blackberry, iPhone & Android  Pursue Strategic Acquisitions  OTC players (revenues/customers)  Convert OTC customers to Rx  Health 2.0 tools and sites
  23. 23. Financial Summary | Annual Financial ResultsUSD 2008 2009 2010 2011Revenue $1,270,527 $3,783,542 $5,691,765 $10,363,293Gross Profit 299,900 1,148,284 $2,241,744 $4,622,767Gross Margin (%) 23.6 30.4 39.4 44.6Net Income ($667,301) ($2,439,502) ($3,691,674 ) ($5,727,073) Revenue Growth 82% Year-Over-Year Gross Profit Growth 106% Year-Over-Year
  24. 24. Financial Summary | Key Annual Statistics 2008 2009 2010 2011Orders 22,951 59,614 71,376 143,787Prescriptions 170 17,853 67,577 157,650Avg. Order Size $55.36 $46.20 $79.74 $57.20Refills 17 4,235 23,789 71,930Page views 1,144,189 4,057,959 5,248,524 11,316,353 Prescription Growth 133% Year-Over-Year Refill Growth 202% Year-Over-Year
  25. 25. Financial Summary | Revenue and Prescription Growth HealthWarehouse continues to grow both its revenue and customer base… Revenue Gross profit Prescriptions filled 3,000 50 Revenue Growth 82% Year-Over-Year Gross Profit Growth 106% Year-Over-Year 45 2,500 40 35 Prescriptions (000s) 2,000 30USD (000s) 1,500 25 20 1,000 15 10 500 5 - - Q109 Q209 Q309 Q409 Q110 Q210 Q310 Q410 Q111 Q211 Q311 Q411 …and still has significant capacity to meet future growth
  26. 26. Financial Summary | Prescription Growth – New and RefillsRefills continue to comprise a larger share of prescriptions Refills New 23,982 21,365 20,320 20,053 14,893 9,756 12,335 21,996 17,138 20,377 7,077 12,419 5,698 5,883 8,977 3,231 Q110 Q210 Q310 Q410 Q111 Q211 Q311 Q411
  27. 27. Financial Summary | Investor AppealHealthWarehouse is the only nationwide, online, mail-order pharmacy withsignificant barriers to entry. Key strengths put the Company ahead  Barriers to entry:  Technology platform that puts us years ahead  VIPPS accreditation  Licensed in all 50 states and the District of Columbia  Strong revenue growth  Increasing website effectiveness  Excellent track record of high customer satisfaction  Market trends & economy favor our business model
  28. 28. Thank You 7107 Industrial Rd Florence, KY 41042 TEL: 1-866-885-0508 http://www.HealthWarehouse.com

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