Corporate Presentation v August 2017 Safe harbor statement This [PDF]

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v

Corporate Presentation

August 2017

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Safe harbor statement

This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended that are intended to be covered by the "safe harbor" created by those sections. Forward-looking statements, which are based on certain assumptions and describe our future plans, strategies and expectations, can generally be identified by the use of forward-looking terms such as "believe," "expect," "may," "will," "should," "could," "seek," "intend," "plan," “goal,” "estimate," "anticipate" or other comparable terms. All statements other than statements of historical facts included in this presentation regarding our strategies, prospects, financial condition, operations, costs, plans and objectives are forward-looking statements. Examples of forward-looking statements include, among others, statements we make regarding expected future operating results, anticipated results of our sales and marketing efforts, expectations concerning payor reimbursement and the anticipated results of our product development efforts. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our

control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not

rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following: our ability to successfully and profitably market our products and services; the acceptance of our products and services by patients and healthcare providers; the willingness of health insurance companies and other payors to cover Cologuard and reimburse us for our performance of the Cologuard test; the amount and nature of competition from other cancer screening products and services; the effects of any healthcare reforms, including the Affordable Care Act, or changes in healthcare pricing, coverage and reimbursement; recommendations, guidelines and/or quality metrics issued by various organizations such as the U.S. Preventive Services Task Force, the American Cancer Society and the National Committee for Quality Assurance regarding cancer screening or our products and services; our ability to successfully develop new products and services; our success establishing and maintaining collaborative licensing and supplier arrangements; our ability to maintain regulatory approvals and comply with applicable regulations; and the other risks and uncertainties described in the Risk Factors and in Management's Discussion and Analysis of Financial Condition and Results of Operations sections of our most recently filed Annual Report on Form 10-K and our subsequently filed Quarterly Report(s) on Form 10-Q. We undertake no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.

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OUR MISSION

To partner with patients, healthcare providers, payers & advocacy groups to

help eradicate colon cancer

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SLIDE 4 Source: American Cancer Society, Cancer Facts & Figures 2017; all figures annual

Colon cancer: America’s second deadliest cancer

new diagnoses in 2015

15,690 26,730 41,070 43,090

50,260

155,870 Esophageal Prostate Breast Pancreas Colorectal Lung

Annual cancer deaths

132,700

deaths in 2015

49,700

135,430

new diagnoses

50,260

deaths

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10+ years

Sources: J Natl Cancer Inst. 2009; 101:1225-1227 (Itzkowitz) Gastro 1997;112:594-692 (Winawer)

Pre-cancerous polyp Cancer

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“The most preventable, yet least prevented form of cancer”

– Journal of the National Cancer Institute

SLIDE 6 Sources: SEER 18 2004-2010 American Cancer Society, Cancer Facts & Figures 2017; all figures annual

Detecting colorectal cancer early is critical

9 out of 10 survive 5 years Diagnosed in Stages I or II Diagnosed in Stage IV 1 out of 10 survive 5 years

Majority of patients diagnosed in stages III-IV

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SLIDE 7 Rx Only

50% 52% 59% 58% 62% 80% goal 2005 2008 2010 2013 2015 2018

Sources: CDC NHIS survey results as published in the CDC’s MMWR between 2006 and 2017

Actual colon cancer screening rates

America’s stagnant colon cancer screening rate

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SLIDE 8 Rx Only Source: Imperiale TF et al., N Engl J Med (2014)

developed with

Cologuard: Addressing the colon cancer challenge

94% early-stage cancer sensitivity Easy-to-use & non-invasive while requiring no preparation, sedation, or time-off FDA approved & included in major guidelines Insurance coverage for 86% of addressable population (80M+ people), including Medicare

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Source: Mayo Clinic poster presentation Su1044, Digestive Disease Week 2016

Knowledge of positive Cologuard improves colonoscopy performance

46% more time spent

n colonoscopy

Mayo Clinic study compares results of unblinded, blinded colonoscopies

2x

Polyps discovered

32%

Increase in pre-cancer detection

4x

Higher flat right-sided lesion detection

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Welcome call 24/7 patient support line Cologuard delivered to home Reminder call Reminder letter

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Patient compliance

%

Driving patient compliance with colon cancer screening

Cologuard’s compliance rate is derived from the number of completed tests reported divided by the number of collection kits shipped to patients during the 12-month period ending 60 days prior to June 30, 2017, excluding program orders.

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SLIDE 11 Sources: *Patient adherence over 3 years’ Liang PS., et al., Am J Gastroenterol. 2016 **Patient compliance within 1 year; Arch Intern Med 2012; 172(7):575-582 (Inadomi) ***Cologuard’s compliance rate is derived from the number of completed tests reported divided by the number of collection kits shipped to patients during the 12-month period ending 60 days prior to June 30, 2017, excluding program orders.

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Impact of patient navigation service on compliance

colonoscopy**

38%

***

66%

FOBT*

14%

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Cologuard increases patient compliance

USMD study highlights opportunity to expand screening & detect curable-stage cancer

American Association of Cancer Research Annual meeting 2016, New Orleans LA USA, LB-296, Proceedings of the American Association of Cancer Research, in press

Non-compliant Medicare patients

393

Cancers in curable stage; 21 advanced adenoma

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Cologuard compliance

88%

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SLIDE 13 *Exact Sciences internal estimates based upon prevalence and detection rates from DeeP-C study (Imperiale TF et al., N Engl J Med (2014)

Impact of Cologuard during second quarter 2017*

~600

early-stage cancers

~200

late-stage cancers

135,000

completed Cologuard tests

Early-stage colorectal cancer detected in more than 6 patients a day

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Strong customer satisfaction with Cologuard

Physicians’ expectations met or exceeded 96% Patients rated Cologuard experience very positive

89%

Sources: ZS survey conducted for Exact Sciences Oct-Dec 2016, n=300 Exact Sciences Laboratories patient satisfaction survey Jan-Jun 2017; n = 2,919

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Commercial strategy engages key audiences

National TV campaign and digital marketing

Patients Physicians & Systems Payers

Market access team and clinical & health publications Primary care sales force and collateral materials

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National TV campaign increasing ordering & adoption

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Exact Sciences nationwide sales force: Establishing a new standard for colon cancer screening

Primary care sales force

Focus on top potential physician offices
Educate physicians & office staff
Improve repeat ordering of Cologuard

Inside sales force

Extend reach of sales force coverage
Support field in education efforts
New physician outreach and pull through

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$1.5 $4.3 $8.1 $12.6 $14.4 $14.8 $21.2 $28.1 $35.2 $48.4 $57.6

Cologuard revenue growth increasing

2015 2016

Quarterly Cologuard revenue ($ Millions)

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2017

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$383 $386 $393 $405 $418 $423

Time-lagged average revenue per test improving

2016

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2017

Note: average Cologuard reimbursement from all payers on a trailing 12 month basis for tests that are at least 6 months old

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$3,660 $2,256 $1,656 $1,437 $1,574 $1,224 $972 $895 $838 $661

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20 30 40 50 60 70 80 90 100 110 120 130 140 $- $500 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500 $4,000

1Q 2015 1Q 2016 1Q 2017

S&M G&A COGS R&D Test Volume

As Cologuard volume grows, cost per test is decreasing

Note: total expense divided by tests completed in the quarter

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2%

***

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A multi-billion dollar U.S. market opportunity

*80 million average-risk, asymptomatic people ages 50-85 **Assumes ASP of $500-525 and 3-year interval for Cologuard ***(135,000 completed tests * 4 to annualize * 3 to account for interval) / 80M

80M+

Potential U.S. screening market for Cologuard* $14B Total Addressable Market**

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4,000 8,000 15,000 21,000 27,000 32,000 41,000 50,000 60,000 70,000 81,000

Cologuard’s growing provider penetration

2015 2016

Cumulative Cologuard ordering providers

2017

Launch of national TV campaign 22

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Coverage accelerated following Cologuard inclusion in USPSTF recommendations

2015 2016

235M total USPSTF

Source: US Census data, AIS Directory of Health Plans: 2016, Exact Sciences Analysis

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86% of Cologuard addressable market covered 2017

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Cologuard becoming the standard of care

Additional coverage driven by data, guidelines and quality measures

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>85% insurance coverage

2009-2013 2014 2015 2017

developed with Mayo Clinic 10,000 patient DeeP-C trial guidelines HEDIS quality measures Medicare Star Ratings coverage approval &

2016

guidelines reconfirmed performance recommended by USPSTF trial results published

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Cologuard: Increasing America’s screening population

Exact Sciences Laboratories patient satisfaction survey data May-Jun 2017; n = 993

38% screened with colonoscopy 51% never screened before 11% screened only with FIT/FOBT Screening history of Cologuard users

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Exact Sciences is a data-driven company

Information from over 585,000 patients and 81,000 physicians

Increase compliance and repeat screening

Patients

Improve quality measures and outcomes

Physicians

Improve quality measures and reporting capabilities

Payers

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Building a pipeline on Cologuard platform

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14M

new cancer cases &

8.8M

deaths

Source: World Health Organization and Centers for Disease Control and Prevention

Cancer’s annual impact nationally and globally

1.6M

new cancer cases &

600k

deaths

Expected 70% increase in new cases within 20 years

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Unique collaboration & platform target deadliest cancers

Regulatory, scientific, and commercial expertise

Exact Sciences

Clinical trials, access to samples, and key

pinion leader support

Mayo Clinic

QuARTS™ PCR chemistry and Cologuard instrumentation

Technology Platform

Identifying specific, proprietary cancer DNA markers to facilitate early detection

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Advantages of the Exact Sciences approach

Methylation markers enable cancer site specificity Cost advantages over Next-Generation Sequencing (NGS) High specificity & sensitivity with few markers

SLIDE 31 Source: Analyst estimates

Liquid biopsy: A growth area for cancer diagnostics

2015 2030 Projected liquid biopsy market

>$13B $200M

Exact Sciences focusing on early detection & recurrence

Screening Diagnostic aid Minimum residual disease Recurrence monitoring Response monitoring Response profiling Targeted therapy selection

Clinical applications

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A need and opportunity in diagnosing lung cancer

Biopsy Surgery

1.5-3M lung nodules discovered annually*

$750M

to $1.5B

Invasive, expensive, and harmful

The Problem Current Options Potential Opportunity

Blood-based biomarker test

**

*Gould et al., Am J Respir Crit Care Med (2015) **Total Addressable Market assumes ASP of $500

CT scans

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Second-quarter 2017 financial results

Second Quarter 2017

Revenues

$57.6 million $48.4 million

Gross margin

69% 65%

Operating expense

$71.1 million $66.9 million

Cash utilization

$43.9 million $36.4 million

Ending cash balance

$484.3 million $274.7 million

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First Quarter 2017

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