Investor Presentation July 2020 NASDAQ: ZYXI Forward Looking - PowerPoint PPT Presentation

Investor Presentation July 2020 NASDAQ: ZYXI

Forward Looking Statements All statements other than historical facts in this release are forward-looking statements within the meaning of the Private Securities Litigtation Act of 1995, or projections and as such are subject to numerous risks and uncertainties. The company makes no express or implied representation or warranty as to the completeness of this information or, in the case of projections, as to their attainability or the accuracy and completeness of the assumptions from which they are derived. Actual results may vary significantly from the results expressed or implied in such statements. Factors that could cause actual results to materially differ from forward- looking statements include, but are not limited to, the need to obtain FDA clearance and CE marking of new products, the acceptance of new products as well as existing products by doctors and hospitals, larger competitors with greater financial resources, the need to keep pace with technological changes, our dependence on the reimbursement for our products from health insurance companies, our dependence on third party manufacturers to produce our goods on time and to our specifications, implementation of our sales strategy including a strong direct sales force, the impact of COVID-19 and other health emergencies and other risks described in our filings with the Securities and Exchange Commission including the "Risk Factors" section of our Annual Report on Form 10-K for the year ended December 31, 2019. 2

Investment Highlights At-Home Electrotherapy Pain Management Leader Building a Sizable U.S. Direct Sales Force Currently with ~300 Sales Reps Compelling and Durable Business Model with High Recurring Revenue Unaddressed Pain Management Market Opportunity, Opioid Epidemic as a Tailwind Pipeline Products, Including Blood Volume Monitor, Provide Upside History of Consistent Operational Execution Strong Financial Performance with Robust Revenue Growth, High Gross Margins, and Profitability 3

Mission & Vision Our Mission Our Vision Zynex is committed to Zynex is committed to being the world’s providing prescription premier pain strength pain relief and management provider exceptional service 4

Zynex Medical Overview Background • NASDAQ:ZYXI (Listed 2019) • Included in Russell 2000 (2019) • Included in S&P SmallCap 600 (2020) • Listed on OTCQB from 2004-2018 • Founded By Thomas Sandgaard – CEO and Chairman • Medical Device Manufacturer – 23 Years • HQ – Englewood, Colorado Business Units • ZYNEX MEDICAL (ZMI) Non-invasive electrotherapy pain management devices “TENS” (>90% of billings 1 ) • 78% gross profit margin 1 • Greater than 75% recurring revenue base 1 – supplies (electrodes/batteries) and leased devices • Rx required, insurance billed • ZYNEX NEURODIAGNOSTICS (ZND) EEG, EMG diagnostics B:B products (<2% 1 of historical billings) NeuroMove Stroke Rehab product • ZYNEX MONITORING SOLUTIONS (ZMS) FDA-cleared, non-invasive blood volume monitor (Zero revenue) 1) Based on Q1 2020 results 5

Zynex Financial Overview Financial Highlights • 16 consecutive profitable quarters • 2020 full year guidance – Revenue $80 to $85 million, Adjusted EBITDA $15 to $18 million • 2020 third quarter guidance • Revenue $22.3M to $22.8M (Q3 2020 revenue ↑ 89% to 93% vs Q3 2019) • Adjusted EBITDA $2.3M to $2.8M (continued investment in growing sales force) • Adding direct sales reps to reach 500 by the end of 2020 Selected Financials Quarters Ended June 30, 2020 vs 2019 • Net revenue ↑ 87% to $19.3M from $10.3M • Gross margin of 79% • Net income ↑ 40% to $3.0M from $2.2M • Adjusted EBITDA ↑ 69% to $4.8M from $2.8M • Orders ↑ 37% • Working capital $23.8M vs $17.4M at 12/31/19 • Cash $16.9M • No long-term debt 6

Pain & Rehabilitation NexWave Electrotherapy Augments healing, alleviates swelling through increased blood circulation, and reduces both acute/chronic pain through the use of electrical currents InWave Incontinence Delivers a nonsurgical, drug-free therapy that offers a Treatment conservative treatment to manage incontinence and is of relatively low cost to patients. NeuroMove Augment healing, as well as assist in recovery for stroke, Stroke Rehab Spinal Cord Injuries and Traumatic Brain Injury, retrains muscles, increases range of motion • All devices above are FDA 510(k) cleared. 7

NexWave: Electrotherapy for Pain Management • Indications: Pain relief, augments healing, alleviates swelling through increased blood circulation, muscle re-education, prevention of muscle disuse atrophy, relaxation of muscle spasms • NexWave Electrotherapy reduces use of Opioids Only 23% of patients with chronic pain found opioids “very effective” 1 • 51% of people feel that they have no control over their pain 2 • 84% of patients were able to reduce medication use 3 • Nearly half reduced medication consumption by 50% 3 • • Patients decreased the cost of medication by 50% 3 • Effective post-orthopedic surgery • Requires a prescription & reimbursed by health insurance • Average reimbursement over order life including supplies ≈ $ 1,500 4 $950 million industry worldwide 5 • • Competitors shut down by Office of Inspector General (OIG) Over 1.5 billion worldwide suffering from chronic pain 6 • • 78% gross profit margin in Q1 2020 • 77% of revenue from supplies (electrodes/batteries) in Q1 2020 1) The CHP Group (2014) The Cost of Chronic Pain: How Complementary and Alternative Medicine Can Provide Relief. http://www.chpgroup.com/wp-content/uploads/2014/12/CHP-WP_CAM-Chronic-Pain_Sls_12.12.2014.pdf 2) American Academy of Pain Medicine (2017) AAPM Facts and Figures on Pain. http://www.painmed.org/patientcenter/facts_on_pain.aspx 3) Chabal, et. al. Long-Term Transcutaneous Electrical Nerve Stimulation (TENS) Use: Impact on Medical Utilization and Physical Therapy Costs Clinical Journal of Pain . The Clinical Journal of Pain . Vol 14, No 1. March 1998 4) Based on revenue from orders from 1/1/2018 through 6/30/2019 5) Market Research Future 2019 6) Global Industry Analysts, Inc. (2011) Global Pain Management Market to Reach US$60 Billion by 2015, According to a New Report by Global 8 Industry Analysts, Inc. http://www.prweb.com/pdfdownload/8052240.pdf

NexWave: Electrotherapy for Pain Management 3 Modalities in 1 Device • IFC (Interferential Current ) – 40x stronger than TENS – Reaches deeper, stimulating motor nerves to release endorphins or enkephalins which results in pain relief that can last for hours (Endorphin Release Theory) – 3-4 treatments per day – Frequency: Ranges from 4000 – 4128 Hz • TENS (Transcutaneous Electrical Nerve Stimulation) – Supplemental to IFC treatments – Used for breakthrough pain – More superficial as compared to IFC, stimulating sensory nerves to provide immediate onset of relief (Gate Control Theory) – Can be used during activities – Frequency: Ranges from 1 - 125 Hz, Pulse Width: 120 – 300 μ s • NMES (Neuromuscular Electrical Stimulation) – Reduces muscle relaxant use – Breaks up muscle spasms – Strengthens atrophied muscles – Increases ROM (Range of Motion) & blood circulation – Improves overall ADLs (Activities of Daily Living) – Frequency: Fixed at 35 Hz, Pulse Width: 480 μ s 9

NexWave: Electrotherapy for Pain Management Most Common Types of Chronic Pain – 27% Back Pain, 15% Neck Pain 1 1) National Institute of Health Statistics. www.cdc.gov/nchs/data/hus/hus06.pdf 10

Building a Strong Distribution Network Direct Sales Physicians & Therapists  ~300 direct sales reps as of June 30, 2020 Patients  Direct sales force is growing rapidly A leading  Inside sales team to support field sales reps Insurance Plans  Physician relationships include orthopedics,  HMO and PPO private physical therapy, sports medicine and distribution insurance plans occupational therapy  Patient’s carrier is directly billed upon product delivery network in the  Indirect Sales Experienced reimbursement staff of ~100 employees electrotherapy Domestic International  Distributors in Canada,  ~20 independent market Australia, Russia, sales reps China, India,  Commission-only Singapore, Holland, Germany, UAE, Malaysia, Saudi Arabia, Egypt and Vietnam 11

Commercial Infrastructure Grow Proven Direct Sales Team 350 300+ Sales Representatives Sales management, national account coverage, 300 direct reps 250 176 200 163 ~300  ~300 direct sales reps as of June 30, 2020 150 102 100 63 100 134 100 54 63  ~20 independent reps as of June 30, 2020 85 50 100 100 42 ~20 0  Growth expected to ~500 direct reps by year 2015 2016 2017 2018 2019 Q2 2020 end 2020 and planned expansion to ~600 by the end of 2021 Indirect Direct Direct Sales Productivity Annual Rep Productivity ($M) $2.0 $1.5M+  Developed focused training program $1.5 $1M designed for reps to achieve long-term $1.0 productivity goal of $1M annually within 18 months of hire $0.5 ~$300k  Top performing sales representatives $0.0 produce $1.5+ in annual revenue Current Est. Annual Long-term Top Rep 1 Productivity Productivity Goal Productivity 12 1) Based on Q1 2020 average rep revenue productivity annualized