Bionics – Future is becoming Reality January 2020 ATONRÂ PARTNERS SA 7, rue de la Croix d’Or - 1204 GENEVA – SWITZERLAND - Tel: + 41 22 906 16 16 www.atonra.ch
2 Bionics Certificate Investment Case Bionics is the merger between Biology and Electronics… ➢ We are living longer but not necessarily better. Bionics is taking on human body disfunctions and disabilities and helping improve the wellness and lifespan of the world population. ➢ Bionics provides better solutions to patients and hospitals while reducing healthcare spending. ➢ Bionics is a defensive sector. Having a disease is not tied to any economic cycle. Bionics Natixis Certificate details Issuing bank: Natixis, Calculation agent : Natixis SA ISIN : XS1317063912 Currency : USD Fees : 1.65% management fee Bionics JPMorgan Certificate details Issuing bank: JPMorgan Chase Bank, Calculation agent : JPMorgan Securities plc ISIN : XS1668108415 Currency : USD Fees : 1.50% management fee
3 Bionics Certificate Key Growth Drivers (I): An Aging World Population ➢ The increase of certain diseases (cancer, heart diseases, diabetes, and chronic diseases) is fuelled by rapid urbanization, sedentary lifestyles, changing diets and an increasing elderly population. ➢ According to the UN, population aged 60 years and over will grow from 962M in 2017 to 2.1Bn in 2050, while the population >80 years old will grow from 137M to 425M over the same timeframe. ➢ Leading causes of diseases are all age-related diseases, meaning age is a significant risk factor. Source: UN World Population Prospects
4 Bionics Certificate Key Growth Drivers (II): The Organ Shortage Crisis ➢ More than 120K people in the US are waiting for lifesaving organ transplants Candidates in the waiting list Organ (2019) Kidney 94 855 Liver 13 426 Pancreas 858 Kidney / Pancreas 1 623 Heart 3 765 Lung 1 365 Heart / Lung 45 Intestine 241 ➢ As a result, 20 people die every day waiting for an organ transplant ➢ Even if transplanted, there is a high risk of rejection; ✓ respectively 25% and 40% of kidney and heart recipients experience some type of acute rejection within the first year after transplant. ➢ The demand for tissue and organs is pushing science to new frontiers of medicine: ✓ Regenerative medicine ✓ Artificial organs ✓ Wearable devices ✓ Healthcare 3D printing Source: waiting list length increases with time; optn.transplant.hrsa.gov
5 Bionics Certificate Key Growth Drivers (III): Healthcare Cost Pressure ➢ The global healthcare spending is expected to increase at an annual rate of 5.4% over 2018-2022, a considerable rise from 2.9% in 2013-2017. ➢ U.S. health care spending reached $3.5 trillion in 2017 and hospitals represents a significant cost driver (about 30% of the total U.S. health care spending). Bionic devices allow hospitals to save costs. ➢ A bionic device can allow people to keep working or return to work more quickly and contribute to society and the economy. ‘’On average, a telehealth visit costs about $79, compared with about $146 for an office visit.’’ The journal Health Affairs ‘’Robotic surgery resulted in immediate conservative savings estimate of $608,546 during a 1 -year period at an academic center performing 557 elective thoracolumbar instrumentation cases.’’ The Journal Neurospine Wearables are predicted to decrease hospital costs by 16 percent in the next five years, and remote monitoring technology could cut our health care costs by some $200 billion over 25 years. CDW Healthcare ‘’If 15 to 20 percent of current outpatient consultations and home health visits were to occur electronically, health care spending could potentially be cut by $25 billion to $40 billion.’’ McKinsey
6 Bionics Certificate Investment Universe Artificial organs Medical robots Digital Health Synthetic Biology Genomics Regenerative Medicine 3D printing
Bionics Certificate 7 A $733B Market By 2024 Growing At A CAGR Of 27% CAGR 2018-2024 Synthetic Biology ($90B) 38% Digital Health ($509B) 28% Regenerative Medicine ($49B) 25% AtonRâ Healthcare 3D Printing ($5B) Bionics 21% Medical Robots ($18B) 21% Genomics ($41B) 14% Artificial Organs ($21B) 9% MedTech ($613B) 5% Source: Industry ARC, Grandview Research, Market Watch, Zion Market Research, Global Market Insights, AtonRâ Partners
8 Bionics Certificate Innovation Is At The Core Of Bionics ➢ In 2017, 13,090 MedTech patents were filed globally, a number higher than any other category of products, representing a 6.2% increase from 2016. European Patent Applications by Field Patent Applications in Fields of technology 2017 Medical technology 13,090 Digital communication 11,694 Computer technologies 11,174 Pharmaceuticals 6,330 Biotechnology 6,278 All fields 16,5590 ➢ Technological advances in fields such as robotics, optoelectronics and, more in general, semiconductors will boost the growth of existing Bionics’ sectors and will induce the birth of new ones. ✓ Improvements in imaging sensors will provide new tools to help endoscopic and diagnostic market ✓ Improvements in power management and battery life allow medical wearable devices to last longer
9 Bionics Certificate Bionics’ Diverse And Innovative Sectors Synthetic Biology: Making the Impossible Possible Biology is becoming programmable …we are now able to re -write the code that powers life. Digital Health: The Era of Patient Empowerment The human body is becoming the biggest data platform … and Bionics companies are capturing this value. Genomics: Towards Precision Medicine Each patient is different and unique in front of a disease → so must be the treatments. Healthcare 3D Printing: The solution to the organ shortage crisis? Today texts and images are printed on a paper by controlling and placing ink or toner on the surface of the paper. In a similar way, 3D printers print… medical devices, drugs and even living organs!
10 Bionics Certificate Bionics’ Diverse And Innovative Sectors Medical Robots: New Means for Better Medicine With over 16,500 hospitals worldwide medical robots can help reduce costs, while also improving outcomes for patients and operations’ effectiveness. Regenerative Medicine: A bit of Me Some animals have impressive regenerative capabilities. The Axololot is able to regrow limb, tail, eye, jaw, and heart. What about humans? Artificial Organs: The Bionic Man is now a Reality Artificial organs (limbs, ears, eyes, heart, pancreas) are already being used to improve people’s quality of life and some others are under way…
11 Bionics Certificate Major Catalysts (I): Health Coverage Is Gradually Expanding ➢ Encouragingly, coverage by Medicare in the US seems to be heading in the right direction as there is evidence on the benefit of the devices and the declining cost for the healthcare sector. ➢ As more evidence about social welfare and reduction in healthcare spending is gathered, coverage will expand ✓ CMS announced this year to speed up Medicare coverage and new technology add-on payments for breakthrough devices granted marketing authorization by FDA. ✓ The rising number of insured everywhere and the expansion of healthcare coverage in developing markets (expansion of China’s healthcare coverage system and the rollout of a new health insurance program in India). ✓ Declining costs of device is a major catalysts for expanded health coverage. Technological progress and new manufacturing techniques have the potential to drastically reduce costs. Prosthetics can cost up to $100,000. The UK-company Open Bionics is now selling its 3D-printed Hero Arm prosthetic for $3,000.
12 Bionics Certificate Major Catalysts (II): FDA To Speed Up The Time Review ➢ A series of recent initiatives by the FDA are going to accelerate the time to market of new technologies, sparking industry innovation . De Novo Pathway for Modernizing the Pre-Cert Pilot class II devices regulatory pathway Program Expedited access to life-threatening conditions Breakthrough Designation
13 Bionics Certificate Major Catalysts (III): Tech Companies Investing Heavily Into This Field ➢ A direct link to the consumer market of medical devices that accelerates innovation ✓ Verily Life Sciences ✓ Distribution platform for (independent subsidiary medical supplies of Alphabet) ✓ AI-assistant Alexa ✓ Electrocardiogram (EKG) ✓ Uber Health → providing feature on the Apple Watch ✓ Access to electronic medical non-emergency medical transportation records on the iPhone ✓ Cloud storage and analytics for precision medicine ✓ Online pharmacy ✓ Ali Health (subsidiary)
14 Bionics Certificate Bionic Devices Make Occurrences Once Considered Miracles Happen Every Day Thanks to bionics, babies born deaf can hear, people who have lost their sight can see, those living with paralysis can walk, upper-limb amputees can type on a keyboard, and lower-limb amputees can dance again « Any sufficiently advanced technology is indistinguishable from magic.»
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