Corporate Presentation Cameron Groome, CEO & President January, 2014 1
Forward Looking Statements This presentation includes certain forward ‐ looking statements that are based upon current expectations, which involve risks and uncertainties associated with the business of Avivagen Inc. and the environment in which the business operates. Any statements contained herein that are not statements of historical facts may be deemed to be forward ‐ looking, including those identified by the expressions “will”, "anticipate", "believe", "plan", "estimate", "expect", "intend", and similar expressions. The forward ‐ looking statements reflect the current expectations of Avivagen Inc. regarding future results or events. These forward ‐ looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations. Avivagen assumes no obligation to update the forward ‐ looking statements, or to update the reasons why actual results could differ from those reflected in the forward ‐ looking statements. 2
Company Highlights • New class of immunity ‐ enhancing natural compounds – Fully ‐ oxidized carotenoids – over 600 proprietary actives • Companion animal applications – Oximunol™ Chewable Tablets for dogs, detailed to veterinarians – Vivamune™ Health Chews formulation for direct ‐ to ‐ consumer sales • Food animal applications as a non ‐ antibiotic feed additive – Enhances growth and feed conversion efficiencies – Protects against bacterial livestock diseases • Multiple sources for sales growth and measurable milestones 3
Technology • Derived from an exciting discovery – Shows how well ‐ known anti ‐ oxidants really work – Previously un ‐ recognized natural compounds – Helps to maintain optimal health • Novel and Proprietary Products – Extensive patent portfolio – Companion animal products entering market – Food animal field trials with major customers 4
Products – OxC ‐ beta • First Active ‐ Fully ‐ Oxidized β‐ Carotene – Carotene is completely transformed by oxidation – Principally into a mix of oxygen co ‐ polymers – Develops strong biological activity • Enhances innate cellular immunity • Dampens adverse inflammatory responses • Activity in multiple species – Controlled & reproducible production process 5
Companion Animals – Oximunol™ • Oximunol™ Chewable Tablets • For dogs, in the United States • Marketed to veterinarians by Bayer Animal Health • 150 sales reps, 84,000 veterinarians, 78M dogs 6
Companion Animals – Vivamune™ • Vivamune™ Health Chews for large dogs, smaller dogs and cats • The Avivagen direct ‐ to ‐ consumer product format – a re ‐ sealable bag of 30 chews. • Marketing in ”Modern Dog” magazine, internet, DRTV, etc. • Available on ‐ line in the U.S. from www.vivamunehealth.com 7
Testimonials More energy, no itching, less shedding Smiley Therapy Dog St. John Ambulance 8
Companion Animal Opportunities • Supplements for Dogs, Cats & Horses • Science ‐ based and proprietary ingredients • Maintenance/protection of general health • Sustain health of skin & coat at any age • Sustain mobility & energy at older ages • Potential to prevent or resolve diseases • Access to large U.S. pet supplement market 9
Food Animals – OxC ‐ beta Premix • For inclusion into prepared feeds • Active at parts ‐ per ‐ million levels and a cost effective alternative to prophylactic use of antibiotics • Shown to work across species, including chickens, pigs, cattle and even fish • A very large market that can be effectively accessed by Avivagen 10
Food Animal Opportunities • Chickens, pigs, cattle, fin ‐ fish, shrimp & more • Science ‐ based and proprietary ingredients • Maintenance/protection of general health • Improving growth rates and feed conversion • Preventing losses from livestock diseases • Accessing Asian markets 50x that of Canada • Customer ‐ driven field trials starting 11
Developments in 2013 • Management Team re ‐ organized (March 11 th ) • Legacy liabilities extinguished (April 12 th ) • Oximunol re ‐ order from Bayer (May 9 th ) • First food animal sale in Asia (June 25 th ) • U.S. availability of Vivamune (July 9 th ) • Delivery of Oximunol re ‐ order (November13 th ) • Refinancing completed (November 14 th ) • Shareholder update letter (December 12 th ) 12
Management • Capable Senior Team: – C. Groome – CEO & President – C. Boland – CFO – G. Burton – Director, Commercialization Science – J. Daroszewski – Director, Product Devel. & Q.A. – D. Hankinson – Executive Director – J. Nickerson – Director, Product Validation – W. Riley – International Business Development 13
CEO Biography • 23 years of life sciences experience – 10 years as a ranked sell ‐ side analyst – 6 years as a leading investment banker – 6 years as EVP of public veterinary Co. – Active advisor & board member – Proven operations, deal making and capital markets capabilities 14
Corporate Goals • Near ‐ term objectives are as follows: – Support U.S. launch of Oximunol canine – Launch Vivamune DTC dog & cat SKUs – Extend markets for our companion ‐ animal SKUs – International marketing of food ‐ animal SKUs – Achieve sales & business development milestones – Communicate progress to capital markets 15
Economic Potential • Our OxC ‐ beta supply supports mix of: – Vivamune revenues to >US$100 million – Oximunol revenues to >US$100 million – OxC ‐ beta livestock revenues to >US$100 million – Gross margins of 50 ‐ 70%, depending on the SKU – Fixed costs of ~C$2.0 million per year – Serious EPS potential 16
Company Highlights • New class of immunity ‐ enhancing natural compounds – Fully ‐ oxidized carotenoids – over 600 proprietary actives • Companion animal applications – Oximunol™ Chewable Tablets for Dogs, detailed to veterinarians – Vivamune™ Health Chews formulation for direct ‐ to ‐ consumer sales • Food animal applications as a non ‐ antibiotic feed additive – Enhances growth and feed conversion efficiencies – Protects against bacterial livestock diseases • Multiple sources for sales growth and measurable milestones 17
Capital Markets ‐ Summary Ticker / Exchange VIV on TSXV Recent Price $0.06 Market Cap $10.0 million 52 week Hi-Low $0.11 -$0.06 Shares outstanding (basic) 168 M Average daily volume ( last 3 months ) 200,000 shares Insiders: ~10% Pathfinder Asset Management: ~10% Share ownership Bloom Burton & Co.: <10% Float: ~70% $170,000/month Burn rate (excludes any cash flow from products) 18
Capital Markets ‐ Comparables Company / Ticker Market Cap Afexa (acquired) $90 M Atrium (TSX:ATB) $751 M Acasti (TSX:APO) $146 M Bioniche (TSX:BNC) $51 M Burcon (TSX:BU) $121 M Neptune (TSX:NTB) $208 M SunOpta (TSX:SOY) $737 M Average: $300 M Median: $146 M Avivagen (TSXV:VIV) $10 M 19
Science is in our nature www.avivagen.com 20
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