EMPOWERING EMPOWERING   ONCOLOGY       DECISIONS      CORPORATE      PRESENTATION      SEPTEMBER 2011
SAFE HARBOUR STATEMENTThe statements made in this presentation or in response toquestions that are not historical facts ar...
EMPOWERING ONCOLOGY DECISIONSDiagnoCure develops andDi    C    d l        dcommercializes morereliable cancer diagnosticte...
GLOBAL MARKET FOR                                   CANCER DIAGNOSTICS                                   CANCER DIAGNOSTIC...
TWO REVENUE GENERATING                      PRODUCTS                                  • Assay to help identify risk of hav...
RECENT DEVELOPMENT                                                     R&D agreement with                                 ...
PIPELINE –               PIPELINE – CLINICALLY RELEVANT                       ONCOLOGY TESTS                              ...
PCA3 FOR PROSTATE CANCER   (licensed to Gen‐Probe)             to Gen             to Gen‐                             8
PCA3                  (PROSTATE CANCER GENE 3)                    ROSTATE CANCER                    ROSTATE CANCER GENE 3)...
PCA3: SOLVING THE PROSTATE                 CANCER DILEMMA                 CANCER DILEMMA The Problem:                     ...
PCA3 PREDICTS    PCA3 PREDICTS RISK OF POSITIVE BIOPSY                       OF POSITIVE BIOPSY     AFTER A PREVIOUSLY NEG...
MULTI‐                  MULTI‐CENTER EUROPEAN STUDY:                    PCA3 BEFORE THE FIRST BIOPSY                   COU...
THE PCA3 MARKET POTENTIAL                                                   ROYALTIES TO DIAGNOCURE:                    PS...
POTENTIAL ROYALTIES BASED ON                     MARKET PENETRATION LEVEL                    MARKET PENETRATION LEVEL     ...
POTENTIAL ROYALTIES BASED ON                     MARKET PENETRATION LEVEL                    MARKET PENETRATION LEVEL     ...
COMMERCIALIZATION               OF PCA3               OF PCA3□ Successful commercial efforts     USA: 13 labpratoires offe...
(Licensed to Signal Genetics)The PrevistageTM GCC Colorectal Cancer Staging Test is a laboratory-developed test. It is now...
COLORECTAL CANCER STAGING                165,000 CRC cases each year in North AmericaStage I      • Lymph node NEGATIVEand...
HISTOPATHOLOGY VS.                                             PREVISTAGETM GCC     Accurate staging is the single most im...
VITAR STUDY RESULTS:             PREDICTION OF RISK OF RECURRENCE IN              PATIENTS WITH STAGE II COLON CANCER     ...
PREVISTAGE™ GCC                                      PREVISTAGE™ GCC                                      MARKET POTENTIAL...
POTENTIAL ROYALTIES BASED ON                              ROYALTIES BASED                    MARKET PENETRATION LEVEL     ...
Lung CancerDiagnostic TestDiagnostic Test  (in development)          23
LUNG CANCER PROGRAM□ DiagnoCure is resuming its lung cancer program  DiagnoCure is     Leverage it past investments in Lun...
LUNG CANCER DIAGNOSTIC TEST□ Increasing number of cases of lung cancer                    of cases of lung      221,100 ne...
LUNG CANCER DIAGNOSTIC TEST                              MARKET POTENTIAL                              MARKET POTENTIAL   ...
FINANCIAL HIGHLIGHTSCommon Shares O/S (July 31,Common Shares O/S (J l 31 2011)             42.9 million                   ...
MANAGEMENT TEAM                               Independent Board Members• Michel E. Côté                     • Alain G. Mic...
INVESTMENT IN DIAGNOCURE□ Focused strategy on genomic tests for                   on genomic  personalized medicine       ...
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201109 DiagnoCure Corporate presentation

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201109 DiagnoCure Corporate presentation

  1. 1. EMPOWERING EMPOWERING ONCOLOGY  DECISIONS CORPORATE PRESENTATION SEPTEMBER 2011
  2. 2. SAFE HARBOUR STATEMENTThe statements made in this presentation or in response toquestions that are not historical facts are forward‐looking i h hi i l f forward‐l ki f dstatements that involve risks and uncertainties, including but notlimited to: risks associated with the uncertainty of product to:development and commercialization; the impact of competitive commercialization;products;products; intellectual property; the risk of unanticipated delays property;in research and development efforts; the risks and uncertainties efforts;associated with the regulation of our tests; our ability to obtain tests;capital when needed; our history of operating losses; and other needed; losses;risks and uncertainties, including those detailed from time totime in periodic reports, including the Annual and QuarterlyReports filed by DiagnoCure with the Canadian SecuritiesRegulatory Authorities. Authorities. 2
  3. 3. EMPOWERING ONCOLOGY DECISIONSDiagnoCure develops andDi C d l dcommercializes morereliable cancer diagnostictests to better support clinicians and patients in making decisions about  d ti t i ki d i i b tclinical interventions. 3
  4. 4. GLOBAL MARKET FOR CANCER DIAGNOSTICS CANCER DIAGNOSTICS $25.7 Bn Cancer diagnostics is  projected to double in 5 years  projected to double in 5 years propelled by converging  trends. 16.20% CAGR • Growing elderly population $12.2 Bn • Increased adoption of molecular  testing • Integration of quantitative assays  in laboratory and clinical settings • Growing number of joint ventures  and investments by major  2008 2013 biopharma players Note: this excludes Biopharma collaborationsrevenues from academic, Lab services government and NGO grants Dx productsSource: The Sharma Group & TSG Partners 4
  5. 5. TWO REVENUE GENERATING  PRODUCTS • Assay to help identify risk of having prostate  cancer • Licensed to Gen‐Probe in 2003 • Launched in Europe and partly in the US • Increasing royalty payments • Approved in Europe and Canada • Submitted to the FDA in September 2010 • Potential of 20 million tests worldwide• Colorectal cancer staging test to better assess  the risk of recurrence• Launched in 2008• Licensed to Signal Genetics in June 2011• Reached  3% of  U.S. North East market• Potential of 69,300 tests in North America 5
  6. 6. RECENT DEVELOPMENT R&D agreement with & h Licensed Previstage Sold US lab to Signal Genetics to  GCC to Signal Genetics Signal Genetics advance certain  Min. US$5.1M first  Min US$5 1M first genomic tests US$5.7M US$5 7M 5 years US$2.5M Strengthened fi S h d financial position i l ii With two cash annuity tests, DiagnoCure will continue to build on itscore expertise in developing clinically relevant and robust tests in cancer  6
  7. 7. PIPELINE – PIPELINE – CLINICALLY RELEVANT  ONCOLOGY TESTS Gen-Probe Prostate / USA(ASR) 20 million EU (CE) PCA3* Canada tests (W ld) t t (World) Colorectal / Signal Genetics CLIA lab 69,300 tests Previstage GCC* USA USA & CAN Lung / 600,000 tests Diagnostic test (USA & EU) Other R&D * DiagnoCure receives royalties on net sales realized by its partners. g y y pASR: Analyte Specific Reagent 7
  8. 8. PCA3 FOR PROSTATE CANCER (licensed to Gen‐Probe) to Gen to Gen‐ 8
  9. 9. PCA3 (PROSTATE CANCER GENE 3) ROSTATE CANCER ROSTATE CANCER GENE 3) CANCER GENE 3) Prostate‐specific, PCA3 Assay: non‐coding RNA1 non‐coding RNA Direct detection of PCA3 in urine Tumor BPH Normal PCA3 PSA Studies have shown that PCA3 RNA is overexpressed,  relative to benign cells, by 60 to 100‐fold in more than  90% of prostate tumors. 1Bussemakers, et al (1999) Canc Res 59:5975-5979 9
  10. 10. PCA3: SOLVING THE PROSTATE CANCER DILEMMA CANCER DILEMMA The Problem: PCA3 test sold worldwide• Serum PSA: a standard test for Serum PSA: a standard test for  by Gen‐Probe by Gen Probe screening Prostate Cancer is not  specific! Detects prostate cancer not BPH• PSA has a false positive rate of 67% PSA h f l iti t f 67% Reduces the number of • Biopsy is costly and can be  unnecessary biopsies associated with considerable  gg Can assess the aggressiveness of  anxiety, discomfort, pain and  i t di f t i d the cancer to guide treatment  complications decision• A large population of men with  Over 80 peer‐reviewed  Over 80 peer‐ p f l l l t d PSA h d falsely elevated PSA has emerged  publications over the years Protected until 2027 under 11 U S patents (iss es or filed) ntil 2027  nder 11 U.S. patents (issues or filed) 2027 under 11 U.S. patents (issues or filed 10
  11. 11. PCA3 PREDICTS PCA3 PREDICTS RISK OF POSITIVE BIOPSY OF POSITIVE BIOPSY AFTER A PREVIOUSLY NEGATIVE BIOPSY A PREVIOUSLY□ 2,400 patients from PCA3 and Prostate Biospy Results 2 arms of GSK’s 2 arms of GSK’s (N= 1072 placebo men in REDUCE) (N 1072 l b i REDUCE) REDUCE trial on  dutasteride 35 Cut- Cut-off PCA3 can help decide decide about repeat about repeat prostate  biopsies PCA3 scores correlate with Gleason Score, and  can predict cancer  di Source: J. Groskopf, et al, Validation of the PCA3 molecular urine test for severity predicting repeat prostate biopsy outcome in the placebo arm of the dutasteride REDUCE trial, (ASCO GU), March 2010 11
  12. 12. MULTI‐ MULTI‐CENTER EUROPEAN STUDY:  PCA3 BEFORE THE FIRST BIOPSY COULD AVOID 40% OF BIOPSIES COULD AVOID 40% OF BIOPSIES 40%Source: EAU et AUA 2011 12
  13. 13. THE PCA3 MARKET POTENTIAL ROYALTIES TO DIAGNOCURE: PSA testing 45 million worldwide orld ide currently 8 %; currently  currently 8 %; 16% beyond US$60M of cumulative sales High PSA Physician may decide  Negative not to do biopsy d bi 5 million PCA3 test Initial I ii l 2 out of 3 biopsiesindication end up NEGATIVE1 Reduce number of  1.8 million Do I need a Do I need a biopsies by 60% biopsy? Worldwide market  Expanded market  opportunity opportunity 1.8 million @ $100 20 million @ $100 $180 million $2 billion $2 billion (initial claim only) 1) PSA specificity: less than 30% 13 PCA3 specificity: 70-75%
  14. 14. POTENTIAL ROYALTIES BASED ON  MARKET PENETRATION LEVEL MARKET PENETRATION LEVEL PCA3 after 1st biopsy $14 $12 $10 Millions $ $8 $6 $4 $2 $0 5% 10% 25% 50%Assumptions: PCA3: 16% on sales from Gen‐Probe, US and EU marketsPCA3: 16% on sales from Gen Probe US and EU marketsNb of tests: 1.8M if only after 1st biopsy / 20M if used before 1st biopsy 14
  15. 15. POTENTIAL ROYALTIES BASED ON  MARKET PENETRATION LEVEL MARKET PENETRATION LEVEL PCA3 after 1st biopsy +PCA3 before 1st biopsy $160 $140 $120 Millions $ $100 $80 $60 $40 $20 $0 5% 10% 25% 50%Assumptions: PCA3: 16% on sales from Gen‐Probe, US and EU marketsPCA3: 16% on sales from Gen Probe US and EU marketsNb of tests: 1.8M if only after 1st biopsy / 20M if used before 1st biopsy 15
  16. 16. COMMERCIALIZATION OF PCA3 OF PCA3□ Successful commercial efforts USA: 13 labpratoires offer the ASR version – Submitted for approval for the FDA Europe  over 40 laboratoires and collection sites offer the  Europe over 40 laboratoires and collection sites offer the PROGENSA PCA3 test (CE marked)  Approuved by Health Canada (2011)□ Second‐generation Second‐ fully automated assay on PANTHER around 2013 PANTHER around 2013 16
  17. 17. (Licensed to Signal Genetics)The PrevistageTM GCC Colorectal Cancer Staging Test is a laboratory-developed test. It is now offered by Signal Genetics, a laboratory certified under CLIA regulation as high-complexity laboratory. 17
  18. 18. COLORECTAL CANCER STAGING 165,000 CRC cases each year in North AmericaStage I  • Lymph node NEGATIVEand II d II • Chemotherapy?? h h ?? • Lymph node POSITIVEStage III • Chemotherapy • Metastatic diseaseStage IV • Chemotherapy 18
  19. 19. HISTOPATHOLOGY VS. PREVISTAGETM GCC Accurate staging is the single most important prognostic factor to  predict disease recurrence and survival.1,2 Histopathology Previstage™ GCC Sensitivity 1 cancer cell in 200 normal cells 1 cancer cell in 10 million normal  cells (100,000x improvement) ll (100 000 i t) Sample Size <1% of lymph node tissue >50% of the submitted lymph  node tissue (375x improvement) Process Manual, subjective  Automated measurement using  measurement of lymph node  ultra‐sensitive RT‐qPCR metastases Analytical sensitivity of 92% and specificity of 98% Protected by 11 U.S. patents/applications until 2030 Protected by 11 U.S. patents/applications until 2 Protected by 11 U S patents/applications until 220301. Joseph, NE et al., Ann Surg Oncol. 2003; 10(3):213‐8 192. Iddings, D et al, Ann Surg Oncol. 2006;13(11):1386‐92.
  20. 20. VITAR STUDY RESULTS: PREDICTION OF RISK OF RECURRENCE IN  PATIENTS WITH STAGE II COLON CANCER PATIENTS WITH STAGE II COLON CANCER SELECTED SUBSET OF 181 PATIENTS WITH T3 TUMOR ≥ 12 LYMPH NODES TUMOR, PrevistageTM GCC can  stratify the risk of  60% recurrence in stage II  26.9% Risk of Colon Canceer colon cancer  ence at 5yrs 45% patients: 30% High risk patients  High risk patients Recurre C have 6 times greater  4.0% 15% likelihood of  recurrence than low  recurrence than low 0% risk patients Low Risk High Risk (GCC LNR ≤0.1) (GCC LNR >0.1) n= 117 n = 64Sargent, D J, et al., Evaluation of GuanylylSargent D J et al Evaluation of Guanylyl Cyclase C Lymph Node Status for C Lymph for Colon Cancer Staging and Prognosis, Ann Surg Oncol., 2011 May 1  20
  21. 21. PREVISTAGE™ GCC PREVISTAGE™ GCC MARKET POTENTIAL MARKET POTENTIAL Treatment Pathology Treatment Stage IV Pathology Metastatic Stage III 34,700 61,000 Adjuvant Diagnosis CANCER SPREAD TO chemotherapy 165,000 in North LYMPH NODES America* A i * Surgeries Europe1: 280,000 130,300 GCC NEGATIVE—No Japan: 94,500 evidence of metastases Stage I & II Has my cancer 69 300 69,300 GCC POSITIVE— spread? CANCER “CONFINED” Evidence of metastases equal to Stage III pN1, pN2 ROYALTIES TO  ROYALTIES TO DIAGNOCURE: NA market opportunity: Patient may be 69,300 @ $3,000 considered Stage III High single digit % $200 million by physician* Sources: Various cancer societies 211. European Economic Union
  22. 22. POTENTIAL ROYALTIES BASED ON  ROYALTIES BASED MARKET PENETRATION LEVEL Previstage GCC $8 $6 Millions $ $4 $2 $0 5% 10% 25% 50%Assumptions: GCC: High single digit percentageGCC: High single digit percentage from Signal Genetics Signal GeneticsNb of tests: 69,900 (North America only) 22
  23. 23. Lung CancerDiagnostic TestDiagnostic Test (in development) 23
  24. 24. LUNG CANCER PROGRAM□ DiagnoCure is resuming its lung cancer program DiagnoCure is Leverage it past investments in Lung Cancer R&D Leverage its core expertise in molecular test development Develop Multiplex PCR diagnostic test for Multiplex PCR diagnostic test for Lung Cancer on bronchial aspirates Market potential: $600M + 24
  25. 25. LUNG CANCER DIAGNOSTIC TEST□ Increasing number of cases of lung cancer of cases of lung 221,100 new cases and 157,000 deaths each year in the U.S.  221 100 new cases and 157 000 deaths in the U S (2011) 1.6 million new cases and 1.3 million deaths each year worldwide First cause of cancer death□ Unmet clinical need Diagnosis: bronchoscopy followed by a histology or cytology test  Results: 50% negative or inconclusive 50% of these have lung cancer but it is not detected  by the initial tests (low sensitivity) by the initial tests (low sensitivity) 25
  26. 26. LUNG CANCER DIAGNOSTIC TEST MARKET POTENTIAL MARKET POTENTIAL Initial Investigation 50% of bronchoscopy result1 are a positive diagnosis Chest X‐Ray  Bronchoscopy and/or CT Scan diagnosis 50% of bronchoscopy result  are negative or inconclusive Do I have Lung Cancer? Lung Cancer? Is it really negative? ll ? What is it exactly? Expanded market  Limited market opportunity (US & Europe) opportunity (US & Europe) 600,000 @ $1000 300,000 @ $1000 $600 million $300 million1Roth et al, BMC Pulmonary Medicine, 2008, 8:2 26
  27. 27. FINANCIAL HIGHLIGHTSCommon Shares O/S (July 31,Common Shares O/S (J l 31 2011) 42.9 million 42 9 millionPreferred Shares O/S (July 31, 2011) 4.9 millionMarket Cap (August 24, 2011)M k C (A 24 2011) $42.6 illi $42 6 millionCash on hand (July 31 2011) on hand (July 31, 2011) $8.8 million $8 8 millionEmployees (July 31, 2011) 15 (R&D: 8) 27
  28. 28. MANAGEMENT TEAM Independent Board Members• Michel E. Côté • Alain G. Michel • Mario Thomas, Ph.D. Corporate Director Chairman of the Board,  Senior Vice‐President Cari‐All Group Ontario Centres of Excellence• Paul Gobeil FCA Paul Gobeil, FCA • Louise Proulx Ph D Louise Proulx, Ph.D. • Vincent R Zurawski Jr Ph D Vincent R. Zurawski, Jr., Ph.D. L:ead Director, DiagnoCure, Inc. Vice President, Research and  Chairman of the Board and Chief  Vice Chairman of the Board, Development, Executive Officer, Avraham Metro Inc. Vertex Pharmaceuticals (Canada) Pharmaceuticals Ltd. Management Team• Yves Fradet, M.D., FRCS(c) • Chantal Miklosi, MBA • Paule De Blois, MBA Chairman of the Board Chief Financial Officer Senior Vice President,  President and  President and o JMP Securities JMP Securities Operations Chief Medical Officer o Orrick, Herrington & o Mercer Consulting o Founder of DiagnoCure Sutcliffe LLP  o Aon Consulting o CHUQ‐ Hôtel Dieu de  o Versata o Desjardins Financial  Québec Securities 28
  29. 29. INVESTMENT IN DIAGNOCURE□ Focused strategy on genomic tests for on genomic personalized medicine li d di i Market expected to double to $7B over the next few years□ Proprietary tests and pipeline tests and pipeline□ 2 revenue‐generating tests 2 revenue‐□ Proven track record High complexity molecular assay development Regulatory strategies (FDA, CE mark, CLIA) Clinical studies Academic and commercial partnerships□ Sufficient cash to reach profitability cash to reach 29

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