Marketing Strategy

Primary Arguments
Considerations
for positioning and selling Etest®
 Background

 Company background AB BIODISK:

 Founded in Stockholm, Sweden in the 1960’s
 Mission statement: “To Promote the Rational use of Antibiotics.”
 Internationally recognized for its antimicrobial resistance testing range and expertise in susceptibility testing of
fastidious and unusual organisms
 7.5 million test sold in >70 countries
 Acquired by bioMérieux on June 18, 2008 because of the excellent synergies between the two companies

 Company background bioMérieux:

 Mission statement: “To contribute to the improvement of worldwide public health through in vitro
diagnostics. “
 A world leader in the field of in vitro diagnostics for 45 years, bioMérieux, with over € 1.06 bil in revenue, is
present in more than 150 countries through 38 subsidiaries and a large network of distributors.
 bioMérieux provides diagnostic solutions (reagents, instruments, software) which determine the source of
disease and/or contamination to improve patient health and ensure consumer safety. Its products are used for
diagnosing infectious diseases and providing high medical value results for cardiovascular emergencies and
cancer screening and monitoring. They are also used for detecting microorganisms in agri-food, pharmaceutical
and cosmetic products. bioMérieux is listed on the NYSE Euronext Paris market (Code: BIM – Code ISIN:
FR0010096479).

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 Agenda

1. Etest Products and Technology

2. Etest and Biotools in the Laboratory
3. Application Areas
4. Positioning and Sales

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 Product Portfolio

The Etest product line

- Main product line
- 57 IVD products (drugs) cleared by the FDA
- 38 products (drugs) available in ROW, as RUO in the
US
- Products available for AST, AFST, AMST, ARD
- Sold in packages of 100 (95%) and 30 strips (5%)

The Biotools product line

- Supporting product line for Etest
- Designed to simplify the use of Etest

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 Etest Product Line

Antimicrobial susceptibility testing

- 57 agents available (IVD, USA and WW)
- 38 agents available (IVD WW, RUO USA)

Antifungal susceptibility testing

- Fluconazole, Flucytosine, Itraconazole (IVD USA and WW)
- Amphotericin B, Anidulafungin, Caspofungin, Ketoconazole, Posaconazole, Voriconazole (IVD WW,
RUO USA)

Antimycobacterial susceptibility testing

- Ethambutol, Ethionamide, Isoniazide (RUO USA)

Resistance Detection tests

- 3 ESBL strips (2 IVD/1 RUO USA) for confirmation of extended spectrum beta-lactamase
- 1 MBL strip (RUO USA) for detection of metallo-beta-lactamase
- 1 GRD strip for glycopeptide resistance detection (RUO)
- 1 strip for AmpC detection (RUO)

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 Etest Gradient Technology

 PREFORMED and STABLE gradient

 ON-SCALE MICs

 WIDE CONCENTRATION RANGE (15 dilutions)

 FLEXIBLE test method/ inoculum tolerant

 VARIETY of agents

 AGAR based system

 RESISTANCE DETECTION - low level, inducable

and hetero resistance

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 Etest stable gradients
competition with Disc Diffusion

Etest optimal for fastidious

and slow-growing
organisms

Disc diffusion changing gradient

Etest stable gradient

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 On-scale MICs

• Confirm unusual, equivocal AST results in the

laboratory, especially when MICs cluster around
breakpoints
• Validate empiric regimen - surveillance testing
• Target individual therapy using MIC & PK-PD
• Dosage adjustment, especially in
immunocompromised patients
• Monitor resistance, de-escalate, modify, or change
therapy especially in poor response to therapy or
recurrent infections

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 Optimal for resistance detection

• Hetero - resistant subpopulations

• Inducible - resistance phenotypes
• Hyper-mutators (Oliver A. et al. AAC, 2004)
• Stepwise - mutators
• Small Colony Variants
• etc................

P. aeruginosa
Broth dil 0.06
Agar dil 0.125
Etest MIC >32

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 Etest for Therapy Optimization

MIC 64 4 1 0.125 4

Drug C best alternative

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 Etest - a Global Brand in Microbiology

 Novel MIC technology

 High level of innovation
 Proprietary
 Globally standardised
 Branding - strong global trademark
 Premium pricing - ”theranostics concept”

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 Agenda

1. Products and Technology

2. Etest and Biotools in the Laboratory
3. Customers and Application Areas
4. Positioning and Sales Tactics

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 Transport and Storage

 Package
 100 or 30 strips/pack
 Sold in foam and blister package (NOTE: not all products available in foam
package)
 Transport
 Ambient temp (20 - 35°C) / courier / 5 days
 Lead time 30 days
 Storage
 Should be stored at temperature conditions specified on the package
• - 20°C (blister package)
• + 4-8°C, or +18-22°C (foam package) depending on agent. Can store all
agents in foam package at +4-8°C
• Etest has 1 to 5 years shelf life from date of manufacture

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 Storage Systems

Storage container MINI MIDI MAXI

(1 cartridge) (2 cartridges) (6 cartridges) (12 cartridges)

Open packages should be stored in a stable and airtight storage with desiccant

Etest storage accessories available in different sizes for storage of 1 up to 12 agents

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 Susceptibility Testing Media

 Aerobes: Mueller Hinton agar

 MRSA/MRSE: Mueller Hinton + 2% NaCl
 Pneumo/Strep: Mueller Hinton + 5% blood
 H. influenzae: HTM, Mueller Hinton chocolate
 Anaerobes: Brucella blood agar
 VRE/VRS: Brain Heart Infusion
 Yeast: RPMI 1640 + 2% glucose + MOPS
 Others - see specific Etest Application Sheet

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 Set-up and Incubation

1. Inoculate 2. Apply the strips 3. Incubate

Retro C80 Inoculator Methods Incubation at 35°C

- Ergonomic - Simplex C76 dispenser system
- Even inoculum - Nema C88 vacuum pen Aerobes: ambient, 15-18 h
- For Etest and KB - Forceps Anaerobes: anaerobic, 24-72 h
Gram neg NF: ambient, 24 h/48 h
Yeast: ambient, 24h/48h
Application templates MRSA/MRSE: ambient, 24/48 h
- 3-6 strips per 150 mm plate VRE/VRS: ambient, 24/48 h
- 1-2 strips per 90 mm plate
Enterococci: ambient, 24 h
Pneumococci: 5% CO2, 20-24 h
Streptococci: 5% CO2, 20-24 h
Neisseria: 5% CO2, 20-24 h
Haemophilus:
5% CO2, 20-24 h

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 Biotools Application Systems

Simplex C76 automatic strip applicator

- Flexible MIC antibiograms
- Optimal positioning
- Easy and Fast

Nema C88 manual strip applicator

- Vacuum pen
- Finger tip control

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 Agenda

1. Products and Technology

2. Etest and Biotools in the Laboratory
3. Customers and Application Areas
4. Positioning and Sales Tactics

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 Sales Mix by Etest Product

Top 5 products (104 total): 36% of sales

Top 10 products: 56% of sales
Top 15 products: 66% of sales

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 Etest Scientific Focus

• > 3,000 scientific references – 50 countries

• 2.9 M isolates > 15 million data points
• Current emphasis on clinical needs for MIC
• Top applications - % studies:
- S. pneumoniae/Strep 20%
- Critical specimens/MIC 18%
- Resistance detection 15%
- Antifungals 15%
- Surveillances 10%
- Anaerobes 10%
- GNF & MDR 10%
- Other 2%

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 Agenda

1. Products and Technology

2. Etest and Biotools in the Laboratory
3. Customers and Application Areas
4. Positioning and Sales Tactics

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 Positioning of Etest

Value Proposition
 
Etest is an easy-to-use complement to existing AST systems that
provides an extensive range of antimicrobials and MIC values
needed for therapeutic decisions.
 
Positioning
 
Etest strips will compliment the antibiotic test menu in routine clinical
laboratories.

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 Positioning of VITEK 2 and Etest

VITEK 2 and Etest technologies are very complimentary

 VITEK 2 automation provides same-day, clinically relevant identification and

susceptibility testing for the majority (~ 90%) of organisms encountered in the
routine clinical laboratory

 Etest provides MICs for slow-growing and fastidious organisms that have unique
growth requirements and cannot be tested by automated methods

 Etest can be used as a simple confirmation test for equivocal results

 Etest enables flexibility in testing new antimicrobial agents due to rapid

development cycle

 Less likely to require redevelopment due to breakpoints change

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 Positioning of VITEK 2 and Etest

 View this as a “Synergy” package solution

 Organism groups not available for testing on routine
system
• Anaerobe testing
• Antifungal testing: yeasts and moulds
• Mycobacterium testing including M. tuberculosis
• Neisseria / Haemophilus testing
• Streptococcus viridans and Group A Streptococcus testing
• Fastidious Gram negative: Francisella, HACEK, Legionella,
Bordetella, Bartonella, Campylobacter,…
• Fastidious Gram positive: Nocardia, Rothia, Gemella, ….
• Helicobacter pylori

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 Positioning of VITEK 2 and Etest

VITEK 2 and Etest technologies are very complimentary

 However, they are 2 different devices that are used for the same purpose

 Therefore, occasionally there will be differences in final results

Obviously, .... we will have to address these questions from our customers

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 Positioning of VITEK 2 and Etest

 AST methods are all developed to give results equivalent to a

reference method; there are 2 MIC reference methods:
 Broth dilution
 Agar dilution

 VITEK 2 and Etest were originally developed to agar dilution

 We are now developing VITEK 2 to broth dilution (new antibiotics or
redeveloped antibiotics)
 We are also validating and developing Etest to broth dilution

 Why?
 Broth dilution is now more widely accepted as the reference method
(EUCAST, CLSI)

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 Positioning of VITEK 2 and Etest

 Remember that there are other differences

 Etest
 Agar-based method
 Overnight incubation
 Manual read
 MIC values read on continuous gradient
 VITEK 2
 Broth-based method
 Rapid method
 Automated read
 MICs reported based on standard two-fold dilution series

 Both methods can be affected by drug, bug, incubation time, incubation

atmosphere, MIC of the drug (does the MIC fall at or around the
breakpoint for example?), growth medium used, type of resistance, other
factors, ………

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 Positioning of VITEK 2 and Etest

So which system is correct when there could be as much as a 2 dilution difference

between the results?

 They both could be “right”.

 This is the nature of a biologic system, there is NO absolute right or wrong!
 You have to consider all of the previously mentioned factors
 Resolution may require performing a reference method
 Even reference methods don’t always agree with each other!
 Bugs can behave differently when tested differently (as previously mentioned).
 Usually the category (S, I, R) will be the same UNLESS the MIC is around the breakpoint, then the
variation will be between S and I or R.

“Generally the acceptable reproducibility of the test is within 1, 2-fold dilution of the
actual endpoint.”
CLSI M7-A7, page 3, 2006

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 Antifungal testing (AFST)

Now accounts for 10 to > 20% of total purchases in many

markets

 Global sales 7% (0.5 million strips)

 US sales 2% - late start, enormous potential left
 European sales 5 – 25%
 Clinical recognition for the need for AFST increasing

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 Supplemental Yeast Etest panel

CS
AND

MYC

POS
IT

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 Critical Care

Think Patients, Diseases, Resistance….

 Immunosuppression
 Chronic infections (e.g. cystic fibrosis)
 VAP – important, high mortality niche
 ICU – suboptimal antibiotic practices today
 Sepsis (bacteraemia, candidemia), meningitis, endocarditis,VAP,
etc

 Cost not an issue, patient costs extremely high, infection control crucial
 50% of therapy in critical care are antibiotic combinations
 Organisms - GNF (MDR), MRSA, VRE
 Estimation = 5 cases/d x 4 strips each = 20 strips x 300 working days = 6,000
strips/ year

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 Critical Care
Cystic fibrosis

Cystic Fibrosis patient populations

e.g Emory University Hospital, Atlanta USA
Prior usage: 1,000 strips/yr.
After CF conversion: 10,000 strips/yr

CF Potential in your market?

- CF patients seen/yr = 500 (could be the same)
- AST spec/month = 50 (approx 10-15/wk)
- 4 strains/morphotypes/spec x 6 strips x 50 spec x 12 mo = 14,000/yr
- Potential Etest volume low: 5000, medium: 10000, high: 20000 strips/centre
- Times the number of centres

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 Paediatric

Thus far neglected segment….

Different PK/PD considerations, dosages etc.

Example of leading US Children’s Center

 Children’s Hospital of Philadelphia (CHOP)
• 18,000 strips/ year

Potential in your market?

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 Fastidious and Orphan organisms

 CLSI M45-A describes AST of orphan organisms

 Market growth in HI & GC & Meningococci
segments are good indicators
 Developed algorithms show ”Orphans” e.g. HACEK
 Rapid Growing Mycobacteria (RGM) opportunity
 Essentially all organisms without breakpoints

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 The in vitro diagnostics market

An steadily growing market

Growing healthcare needs

Aging population
Sicker patients

Need to lower healthcare costs

Need for better clinical decisions
……………………………………………….

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 bioMérieux

 A major player in the in vitro diagnostics market

 A broad international presence

 Strong positions in high-growth segments (e.g. ID/AST >47%)

 Sales network: high quality, knowledgeable, global coverage

 R&D: substantial investment over the long term

 Industrial applications, global leadership

 Only company in the industry with extensive skills in culture, molecular

biology and immunoassays

 Installed base of more than 16,000 ID/AST instruments

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 Strategic plan

 From a strategy focused on the laboratory

 Infectious diseases, oncology, and cardiology

 Industrial applications

 To a strategy focused on patients, consumers, pathologies and

clinicians' needs

 Infectious agents: clinical and industrial applications

 Tests delivering high medical value
• Theranostics: therapeutics + diagnostics
• Oncology
• Cardiology
• Point-of-care tests
• etc…….

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 bioMérieux Microbial Infections

Become the undisputed leader in Microbiology

 ID/AST Objectives (from LRP)

 Annual growth rate of +8% (auto), +4% (manual)
 Market share of approximately 55% in 5 years (from 47% in 2007)

 Assets
 More than 40 years of experience and know-how
 More than 50% of the market in automated culture

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 INDUSTRY

 Objective
 2012: market share of approx. 30%
 Organic growth - R&D
 PPM: growth driven by chromogenic culture media
 TEMPO: US launch in Q1 2007 and menu extension
 Molecular biology: first test for industry to be launched in 2007
 External growth
 Distribution agreements: e.g. exclusive worldwide distribution with Copan
 Acquisitions
 Assets
 Undisputed leadership
 Ability to leverage the clinical sales network

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 Etest and VITEK 2
Synergy through marketing

 Established global marketing and sales channel can immediately

increase the volume of Etest sales
 Product synergies gives cost effective marketing, think ”bundling”
 Automation + Manual synergy gives competitive advantage against
other automated systems
 Agar based + broth based MICs give a competitive AST package
 R&D and new product development synergies

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 Etest and VITEK 2
AST Testing Synergy

 Etest is a very strong, internationally recognized brand

 Supported by more than 3,000 scientific references
 Optimal method for fastidious and unusual organism
 15 dilution MIC concentration for all products
 Complimentary to the VITEK technology
 Very positive sales trends
 2 products with a very solid track record
 More than 40 years of experience in infectious diseases
 Demonstrated innovation capabilities
 Deeply committed teams
 ……………..