 BIOLASE,
Inc. Federico Pignatelli, Chairman & CEO
Alexander K. Arrow, MD, President & COO
NASDAQ: BIOL
www.biolase.com
Investor Update
September 2013
Exhibit 99.1 |
 Safe Harbor
Statement 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.
PAGE
2 |
 BIOLASE
has: •
Invented,
•
Developed,
•
Patented,
and been granted FDA clearances for
a fundamentally different kind of tissue-cutting tool
PAGE
3 |
 •
Water molecules within tissue absorb laser
energy from the WaterLase and vaporize,
resulting in an atraumatic ablation of the
tissue.
–
Very little trauma or bleeding,
–
No heat or vibration, and
–
Little or no pain
–
Significantly reduces cross contamination
WaterLase All-Tissue Lasers
PAGE
4
•
Extensive patent protection
•
Multiple other medical applications |
 Patient
Testimony PAGE 5 |
 How It
Works: WaterLase High Speed Cutting PAGE 6
|
 WaterLase
Atraumatic Pediatric Tooth Extraction The aiming beam
does not cut the
tissue nor
generate heat.
The tissue is cut
biologically, with
little or no pain,
when the laser
energizes water
at the molecular
level.
PAGE 7 |
 PAGE
8 |
 Digital
Imaging:
Best-in-class
digital
imaging
equipment,
including cone beam 3-D dental imaging and CAD/CAM
digital dental impressions.
Non-Dental:
The
EPIC-V,
and
coming
soon,
the
EPIC-S
Diode soft-tissue dental lasers: The EPIC 10
Soft Tissue laser, which in June 2013 won the MDE gold medal in
medical device design, and the iLase, a portable diode
laser with no foot pedal, power cord, or external controls.
BIOLASE Products
PAGE 9
All-tissue
dental
lasers:
Our
flagship
laser,
the
WaterLase
iPlus, and the WaterLase MD Turbo. |
 Our
near
term
focus
is
to
continue
to
emphasize
our
core
dental
laser
business
and
our
growing
line
of
digital
imaging
systems
and
CAD/CAM
intra-oral
scanners.
We
entered
the
Veterinary
market
in
Q3
2013
and
may
enter
the
ENT
market
in
Q4
2013.
Diversification in 2013
PAGE 10
2012 (Actual)
2013 (Projected)
Dental Laser Systems
~74%
68-70%
Imaging Systems
~6%
8-10%
Consumables
~10%
10-12%
Services
~10%
10-12%
License fees and Royalty
Less than 1%
1-2%
ENT Laser Systems
-
TBD
Veterinary Laser Systems
-
New Launch |
 Why Should
Dentists Buy a Waterlase iPlus? •
WaterLase
enables
dentists
to
perform
procedures
that
they
would
otherwise
refer
to
specialists,
for
example:
•
Gingivectomy = $160-$200
•
Perio Treatment = $375-$1,000
•
Hard-tissue Crown Lengthening = $500-$700
•
Herpetic
or
Aphthous
Ulcer
=
$300
-
$500
•
Frenectomy = $400-$600
•
These procedures are easy to learn and training is included in the cost.
•
With no anesthesia, the WaterLase also increases efficiency and allows the dentist to
work in multiple quadrants in a single visit., equating to $250-$750 per
day in additional revenue. Monthly Finance Payment
New Monthly Revenue Generated
Approx. $1,300
$5,000 –
$15,000
PAGE 11
A dentists’
return on investment can
be 500% to 1,500%
Return on Investment |
 •
WaterLase dentists offer their customers more
procedures
and they have a higher rate of acceptance.
Patients are more likely to accept treatment if it does not
hurt them.
•
Case Study: Doctor David Peck
(Springfield, MA)
–
$1M practice in 2010; purchased a WaterLase iPlus
in January 2011.
–
Practice grew to $1.7M in 2011; For example, Dr.
Peck performed 75 frenectomies in 2011 that
generated $35,000 of revenues. That’s a total of
about 90 minutes of work.
–
Purchased second WaterLase iPlus in Sept 2012; practice
grew to $2.0M in 2012.
Value Proposition of WaterLase
PAGE 12 |
 Who have we been
selling to? PAGE
13 |
 •
EPIC 10 total diode solution
–
regulatory clearance late Q3 (EU) & early Q4
(US) 2012.
–
cleared for 3 unique uses:
Soft Tissue Surgery,
Whitening,
Pain Therapy.
Diode Soft-Tissue Dental Lasers
PAGE 14
•
iLase
–
portable diode laser.
–
no foot pedal, power cord, or external controls. |
 •
TRIOS intra-oral
scanner and cart:
–
digital
impression
taking.
–
handheld
scanner,
operator's
control cart,
and software.
–
North American
distribution
agreement
through Aug
2017.
In-Licensed Products
•
NewTom/Cefla 3D
cone beam
imaging products:
–
medical grade
imaging
technology.
–
less cost, less
radiation
exposure.
–
U.S. & Canada
distribution
agreement
through Feb 2015.
PAGE 15 |
  Da Vinci Imaging is
Ready to Help Laser Sales Core Laser Business
Biolase Da Vinci Imaging
PAGE
16 |
 PAGE
17 |
 PAGE
18 |
 BIOLASE lasers
are to other cutting tools like a smart phone is to a telephone
PAGE
19 |
 The Dental
Drill vs. the WaterLase PAGE
20 |
 The Scalpel vs.
the Epic PAGE
21 |
 Annual Net
Revenue and Stock Price PAGE 22
Projected revenue guidance of
approximately $68 million, last
updated August 7, 2013. |
 Quarterly Net
Revenue and Influencers in Turnaround PAGE 23 |
 •
160,000 dentists in US & Canada.
1
•
Approximately 1.5 M dentists in 134
countries.
–
rapid growth in emerging economies
2
e.g. China, India & Indonesia.
•
Current market penetration.
–
approx. 5.0% of dental practices in US.
–
approx. 1.5% worldwide.
•
Each incremental 1% market penetration equals over $600M
revenue.
•
Dental laser market opportunity is over $50B.
BIOLASE’s Market Opportunity
Est. total global market
BIOLASE systems sold worldwide 1998-present
1
American Dental Association.
2
World Federation of Dentistry.
PAGE 24 |
 Dominant Market
Position WW Hard-tissue Dental Laser Market
WW Total Dental Laser Market
80%
45%
BIOLASE Market Share
PAGE 25 |
 WaterLase
Technology Substantially Reduces the Risk of Cross Contamination and
Contagion Burs and Endo
Files:
WaterLase
Tips:
•Complex and rugged bur surface
difficult to sterilize. •Smooth tip surface does not harbor debris or
bacteria like abrasive surface of burs or files.
•YSGG laser energy is
bacteriacidal.³
•Disposable tips work without
the need to contact tissue. Also eliminates accidental sticks with
contaminated burs. •15% of
“sterilized”
burs and up to 76% of “sterilized”
endodontic files carry pathogenic micro-organisms.
1, 2
•Autoclaving fails one out of
every seven times to decontaminate burs.¹
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
PAGE
26 |
 PAGE 27
•
314 patents issued & pending.
•
70% are related to WaterLase technology & medical lasers.
Extensive Patent Portfolio
Issued &
Active
Pending
Total
U.S.
80
44
124
International
82
108
190
Total
162
152
314 |
 •
Continued sustained top line growth
•
Non-GAAP profitability, GAAP profitability, becoming cash
flow positive
•
Launching 1-2 major new products per year
•
Entering one new non-dental market per year
•
Alleviating working capital constraints that have been hurting
our operating margins and our progress
•
Return to our reputation as a product-driven company
Corporate Goals
PAGE
28 |
 BIOLASE Corporate Headquarters in Irvine, California
PAGE 29
•
Sales offices in Floss (Germany), Madrid (Spain),
Shanghai (China), and Mumbai (India); expansion
planned in Dubai (UAE), and Rio de Janero (Brazil).
•
Floss also has service and manufacturing capabilities.
•
Training facility at corporate HQ with access to state-of-
the-art facilities throughout the U.S. & Internationally.
BIOLASE Europe in Floss, Germany
•
57,000 sq. ft. facility in Irvine, California, includes
manufacturing and development facilities.
•
Can accommodate growth to $250 million.
•
Over 210 employees worldwide.
BIOLASE Facilities & Employees |
 •
The “big story”
potential of pipeline products in at least five
new markets (orthopedics, ophthalmology, ENT surgery,
podiatry, and veterinary surgery)
•
The stability and risk-reduction of an established growing
business in its first market: dentistry
•
With BIOLASE, you get both advantages in one company: (1)
potential upside from a deep pipeline, and (2) an established
growth business –
at a very low multiple of revenues
A Growth Story with
Proof-of-Concept
PAGE
30 |
 Management and
Board of Directors Management
–
Salary $1, ownership position 5.5%
–
Ownership position: 1.5%
–
Ownership position: 0.7%
Board of Directors
PAGE
31
•
Federico Pignatelli, Chairman
•
Gregory Lichtwardt
•
Erin Enright
•
Frederic Moll, MD
•
Alexander Arrow, MD
•
Norman Nemoy, MD
•
Federico Pignatelli, CEO
•
Alexander Arrow, President & COO
•
Frederick Furry, CFO
•
Bill Brown, VP Bus Dev & Sales
•
Orlando Rodrigues, VP Marketing
•
Dmitri Boutoussov, VP R&D
•
Colleen Boswell, VP RA/QA |