Competing for CapitalBiocartis case study

27 October 2016Vlerick Healthcare Conference

NOTICES AND WARNINGS

This presentation has been prepared by the management of Biocartis Group NV (the "Company"). It does not constitute or form part of, and should not be construed as, an offer, solicitation or invitation to subscribe for, underwrite or otherwise acquire, any securities of the Company or any member of its group nor should it or any part of it form the basis of, or be relied on in connection with, any contract to purchase or subscribe for any securities of the Company or any member of its group, nor shall it or any part of it form the basis of or be relied on in connection with any contract or commitment whatsoever.

The information included in this presentation has been provided to you solely for your information and background and is subject to updating, completion, revision and amendment and such information may change materially. Unless required by applicable law or regulation, no person is under any obligation to update or keep current the information contained in this presentation and any opinions expressed in relation thereto are subject to change without notice. No representation or warranty, express or implied, is made as to the fairness, accuracy, reasonableness or completeness of the information contained herein. Neither the Company nor any other person accepts any liability for any loss howsoever arising, directly or indirectly, from this presentation or its contents.

This presentation includes forward-looking statements that reflect the Company's intentions, beliefs or current expectations concerning, among other things, the Company's results of operations, financial condition, liquidity, performance, prospects, growth, strategies and the industry in which the Company operates. These forward-looking statements are subject to risks, uncertainties and assumptions and other factors that could cause the Company's actual results of operations, financial condition, liquidity, performance, prospects, growth or opportunities, as well as those of the markets it serves or intends to serve, to differ materially from those expressed in, or suggested by, these forward-looking statements. The Company cautions you that forward-looking statements are not guarantees of future performance and that its actual results of operations, financial condition, liquidity and the development of the industry in which the Company operates may differ materially from those made in or suggested by the forward-looking statements contained in this presentation. In addition, even if the Company's results, condition, and growth and the development of the industry in which the Company operates are consistent with the forward-looking statements contained in this presentation, those results or developments may not be indicative of results or developments in future periods. The Company and each of its directors, officers and employees expressly disclaim any obligation or undertaking to review, update or release any update of or revisions to any forward-looking statements in this presentation or any change in the Company's expectations or any change in events, conditions or circumstances on which these forward-looking statements are based, except as required by applicable law or regulation.

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Intern becomes CFO

Ewoud Welten, afkomstig van de investerings bank Kempen & Co, neemt haar plaats als financieel directeur in. De manier waar op hij daar te recht kwam, is op merkelijk. Kempen & Co laat zijn bankiers toe om eens over de muur te kijken en stage te lopen bij een bedrijf. 'Ik draaide hier vorig jaar vier maanden mee, en heb zelfs een deel van de voor bereidingen op de beurs gang mee gemaakt', zegt Welten. 'Het is uitzonderlijke maar ideale manier om te recruteren', zegt Win dels.

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High precision diagnostics for high precision medicine

• ‘First time right’ molecular diagnostic system

• Combining advantages of point of care testing with performance of reference testing

EARLY DIAGNOSIS THERAPY SELECTION PATIENT MONITORING

• Rapid diagnosis • High sensitivity• Comprehensive panels

• Treatment guidance• Companion diagnostics

• Monitoring of treatment progress

• Early detection of relapse IdyllaTM

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IdyllaTM best-in-class

• Fully automated sample-to-result

• Accurate results at right sensitivity

• High levels of multiplexing

• Short turnaround time

• Modular

• Connectivity

6

Inst

rum

ent

Conso

le

Disposable cartridge

Limitation of erroneous results due to standardisedcartridge

• Any sample type

• No sample pre-treatment

• All reagents on board

• No PCR lab infrastructure

• No cold chain

• Stable at room temperature

Offering potential for CLIA waiver

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Idylla™ follows a razor-razorblade model

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• Cartridge consumption on Idylla™ instruments is key value driver of Biocartis

• A broad installed base of Idylla™ instruments with expanding Idylla™ test menu facilitates cartridge consumption

An increasing installed base will:• Grow consumption of existing Idylla™ tests• Accelerate market adoption of new Idylla™ tests

Instrument installed base growth

Test

menu e

xpansi

on

Rapidly expanding test menu

9

10

Menu for oncology and infectious diseases

1. Source: Markets & Markets: In Vitro Diagnostics (IVD) Market by Product Technology (Immunoassay, Clinical Chemistry, Molecular Diagnostics, Hematology) by Application (Diabetes, Cancer, Cardiology, Autoimmune Diseases) - Forecast to 2020

2. FFPE is abbreviation of Formalin-Fixed Paraffin Embedded

Oncology Infectious diseases

Fastest growing segment of the MDxmarket1 - CAGR of 17% between 2015-2020

Largest segment of the MDx market1 –44% of total in 2015

• Direct processing of FFPE2 tumour slices

• Highly sensitive detection of a vast range of mutations from tissue or blood

• Ability to offer syndromic panels that include quantitation

• Short turn around times combined with high sensitivity

• Sample enrichment platform for sepsis application

• Solid biopsies and liquid biopsies

• First wave of tests based on clinically proven and reimbursed biomarkers

• Second wave to include new proprietary biomarkers

• Syndromic panels (e.g. respiratory tract panel assays)

• Disease surveillance

• Sepsis

• Viral load assays

USPs

Focu

s

PARALLEL MENU EXPANSION

Strategic partnerships

(Focus on CDx development)

(Initial tests include Flu-RSV)

Diagnostic app developer partnerships

Our diagnostic app store

On market 2016 2017 Focus 2018 - 2020

ON

CO

LO

GY

INFECTIO

US

DIS

EASES

KRAS CE (colon)

BRAF CE (melanoma)

NRAS / BRAF / EGFR492 RUO (colon)

IFV-RSV Panel CE+

ctBRAF RUO (melanoma)

Intention to launch at least 4 tests per year

CE = CE-marked tests. RUO = Research Use Only. EUA = Emergency Use Authorisation label + JnJ test ++ Fast-track Diagnostics development

Note: overview is subject to changes in prioritisation of test development driven by several factors such as commercial and operational considerations. Overview excludes regional expansion (as of 2017), life cycle management and potential partner tests.

Onco Solid Biopsy

Onco Liquid Biopsy Infectious

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LCP~ RUO (lung)

Ebola EUA

ctKRAS RUO (colon)

ctNRAS / BRAF / EGFR492 RUO (colon)

NRAS CE (colon)

NRAS/BRAF CE (colon)

LCP~ CE (lung)

MSI (colon)

ctKRAS CE (colon)

ctNRAS / BRAF CE

(colon)

Respiratory MP++

NGS Prep Panel I

IdyllaTM Retrieve

NGS Prep Panels (second panel in 2018)

10 14 Around 30 assays on market by 2020

# unique tests on market

IFV-RSV 510k submission+

Sepsis (initial launch in 2018)

MERS++ Meningitis++

Solid biopsies• Fusions (ALK/ROS…)

• Amplification (Her2/Met…)

(Pan tumour panels)

• Immuno TX Panel• Neuro Panel• HPV (head & neck)

Liquid biopsiesLung, colon and breast cancers: easy diagnostic inclusion and monitoring of resistance to therapy

Syndromic panels: e.g. Tropical Fever and Immunocompromised panel

Viral load assays: HIV+, HBV and HCV

~ LCP = lung cancer panel11

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106 Idylla™ instruments added to installed base

82

27183

165

106

2014 Increase2015

31-Dec-15 IncreaseH1 2016

30-Jun-16

Installed base development

• Key drivers behind growth H1 2016:o Oncology menu expansion end 2015 (doubling

number of oncology tests to four)o Launch of Idylla™ EGFR Mutation Assay* end

Q2 2016

• Significant number of new installations placed with customers towards end of Q2 2016

• Majority of new placements in H1 2016 with customers in Europe

* The Idylla™ EGFR Mutation Assay is intended for Research Use Only, not for diagnostic procedures. Not for sale in the USA and Canada.

Remarks

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Razor-razorblade approach in numbers

30 June 2015 30 June 2016

Installed baseIdylla™ instruments: 114

Number Idylla™ tests on market: 2

Installed baseIdylla™ instruments: 271

Number Idylla™ tests on market: 7

Cartridge volume

Commercial cartridge volume H1 2016 > 2x volume 2015 full year

Idylla™ KRAS Mutation Test top selling product in H1 2016, followed by Idylla™ BRAF Mutation Test

Increase in product revenues of 63%

Breakdown total operating income

In EUR 1,000 H1 2016 H1 2015

Idylla™ System Sales 988 1,246

Cartridge Sales 1,723 416

Product sales revenue 2,711 1,663

Collaboration revenue 3,377 4,866

Service revenue 20 48

Total revenue 6,109 6,577

Grants and other income 641 646

Total operating income 6,750 7,224

40%

50%

0%10%

Product sales revenue

Collaboration revenue

Service revenue

Grants and other income

H1 2016 H1 2015

23%

67%

1%

9%

Product sales revenue

Collaboration revenue

Service revenue

Grants and other income

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How did Biocartis finance itself?

Started with private financing rounds

Historical financing rounds Pre-IPO shareholder base (% TOTAL SHARES)***

RMM

Benaruca

20%

14%

12%

8%

7%

5%

5%

4%

4%

3%

3%

3%

Padoki

*** Assuming completion of the entire Series F financing round and on a non-diluted basis. Other investors (12% in total) are:

Wellcome Trust, Advent, Petercam and other family offices

Round Date Amount

Foundation Jul. 2007 € 62,500

Seed Capital Jul. 2008 € 1.25 M

Series A Oct. 2009 € 10.0 M

Series B Apr. 2010 € 44.0 M

Series C Nov. 2011 € 58.6 M

Series D Dec. 2012 € 34.5 M

Series E Nov. 2013 € 30.0 M

Series F1* Nov. 2014 € 21.5 M

Series F2 Jan. 2015 € 21.5 M

Total** € 221.4 M

Series F3 IPO pre-commitment € 21.5 M

* In August 2014 the investment agreement of the F-round financing was signed: EUR 64.5

million (in 3 equal tranches) was committed

** Includes MyCartis; historical investment approx. EUR 40m

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Joined forces with strategic partners

Strategic partnerships Diagnostic app developer

partnerships

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Oncology

Infectious Diseases

Attracted grants

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Project Taurus

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Intention to float on fool's day

Global Coordinator and Joint

Bookrunner

Joint Bookrunners

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Listing venue Euronext Brussels

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IPO launched on April 15

Price range set at

EUR 10.0 – 11.5

Max. potential proceeds of EUR 115m

Successful IPO raising EUR 115m

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Strong investor demand

Total demand for EUR 650m

~6.5x over-subscribed

* Excluding pre-commitment and retail

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Key success factors?

Compelling equity story External validation EU and US investors Market conditions

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Listing consequences

• Access to additional sources of funding

• Liquid shares

• FOCUS

• A smaller board

The good things The flip side

• The share price

• Disclosure price sensitive information

• Reporting obligations

• Management time

Selection

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Funding manufacturing expansion• Manufacturing instrument and console successfully

outsourced in to a contract manufacturing organisationwhich enabled:

– realisation of significant cost efficiencies

– required scaling of production capacity

• Biocartis currently operates one cartridge manufacturing line that is located in Mechelen (Belgium)

• Over 150,000 cartridges manufactured to date

• Capacity current line is being ramped up by adding workstations and implementing additional shifts in 2016

• Equipment and tools of a new higher capacity line ordered end of 2015. This second line should be operational in 2017

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EUR 55m debt financing announced in July 2016

Lease financing(EUR 15m)

Credit lines(EUR 25m)

Subordinated loan

(EUR 15m)

• To fund the equipment of a second Idylla™ cartridge manufacturing line

• To fulfil certain future financing needs in, amongst others, working capital

• Consisting of a EUR 15m rollover credit line and EUR 10m working capital credit line

• Partially guaranteed by Gigarant+

• To refinance the company’s current subordinated loan of EUR 5m (excluding accrued interest charges) due end of 2016

Element Providers Background Inclusion

• ~ EUR 5m drawn as per 30 June 2016

• Not included in H1 2016 accounts as signed after 30 June 2016

• Not included in H1 2016 accounts as signed after 30 June 2016

* ~

* Flemish Investment Company ‘ParticipatieMaatschappij Vlaanderen’~ Belgian ‘Federal Holding and Investment Company’ (FPIM)+ Guarantee by Flemish Government through Gigarant

What is next?

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Operational cash flow

Non-dilutive financing

Debt Equity

Financing spectrum

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What tools are currently available

Equity

Mezzanine

• Issue ordinary shares

Lease financing

SEDA• Standby equity distribution agreement

• Subordinated loan senior to equity only

• Sale and lease back of assets

Equity

Debt

Working capital financing

• Debt financing used for working capital purposes

Selection

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What are future debt financing tools?

Size cash flow

Pre

dic

tabili

ty c

ash

flo

w

Convertible bond

Private placements

Senior corporate

loan

Listed bonds

…

Selection

Questions?

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