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Issuer Free Writing Prospectus Filed Pursuant to Rule 433 Registration No. 333-201437 Date: January 21, 2015
Personalized Medicine from a Liquid Biopsy
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Forward–Looking Statements
This presentation contains, and any accompanying oral presentation would no doubt contain, forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, regarding us (Biocept, Inc.) and our business. Forward-looking statements include all statements that are not historical facts and generally can be identified by terms such as anticipates, believes, could, estimates, expects, intends, may, plans, potential, predicts, projects, should, will, would, or the negative of those terms and similar expressions.
Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. For details about these risks, please see our SEC filings.
All forward looking statements contained in this presentation speak only as of the date hereof, and except as required by law, we assume no obligation to update these forward-looking statements whether as a result of any new information, future events, changed circumstances or otherwise. 1
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FWP Statement
This presentation highlights basic information about us and the offering to which this communication relates. Because it is a summary, it does not contain all of the information that you should consider before investing in our common stock.
We have filed a registration statement (including a prospectus, which currently is in preliminary form) with the US Securities and Exchange Commission for the offering to which this presentation relates. The registration statement has not yet become effective. Before you invest, you should read the preliminary prospectus in the registration statement (including the risk factors described therein) and other documents we have filed with the SEC for more complete information about us and the offering.
You may access these documents for free by visiting EDGAR on the SEC website at http://www.sec.gov The preliminary prospectus, dated January [21], 2015, is available on the SEC Web site at http://www.sec.gov/Archives/edgar/data/1044378/000095012315000339/bioc-s1a_20140930.htm
Alternatively, we or any underwriter participating in the offering will arrange to send you the preliminary prospectus and, when available, the final prospectus and/or any supplements thereto if you contact Aegis Capital Corp., Prospectus Department, 810 Seventh Avenue, 18th Floor, New York, NY 10019, telephone: 212-813-1010, e-mail: prospectus@aegiscap.com 2
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Offering Summary
Issuer Biocept, Inc.
Exchange/Ticker NASDAQ Capital Market / BIOC
Offering Size Approx. $15,000,000 of Common Stock (100% Primary)
Over-Allotment 15% (100% Primary)
Sales and marketing for test offerings
Use of Proceeds Assay development and validation
Automation and scale up
Joint Book-Runners Aegis Capital Corp. and Feltl and Company 3
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Biocept’s Liquid Biopsy Solution
Answering an Unmet Medical Need
Do I qualify for this drug? Does my treatment need to be changed?
The Right Therapy for the Right Patient at the Right Time
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Business Overview
R&D Manufacturing
Clinical
Clinical
Development Lab
CLIA facility in Genomic test
San Diego, CA results sent to physicians
R & D, test kits manufactured and samples analyzed 5
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Investment Highlights
Commercial stage cancer diagnostics company with ground-breaking technology platform utilizing a simple blood test
OncoCEE™: captures circulating tumor cells (CTCs)
CEE-Selector™: enhanced sensitivity for genomic mutation analysis
Commercialized tests for breast, gastric and non-small cell lung cancer Test pipeline focused on solid tumor biomarkers in lung, breast, colorectal, prostate and melanoma Established, certified and scalable CLIA lab Clear path to market penetration Established research collaborations and strategic partnerships 6
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Biocept Executive Team
CEO of Hale BioPharma Ventures with over 36 years as a life sciences sector leader
David Hale Chairman (current or former) of Santarus (acquired by Salix), Conatus, Micromet (acquired by
Chairman Amgen), and SkinMedica (acquired by Allergan)
CEO of Hybritech (acquired by Lilly), Gensia (acquired by Teva)
More than 25 years in healthcare sales, marketing and commercial operations
Michael Nall 16 years in cancer diagnostics and genomics
President and CEO Most recently General Manager N. American Sales and Marketing for Clarient—a GE
Healthcare Company
25 years life sciences industry experience
William Kachioff 15 years of experience in public company finance
SVP, Finance and CFO Abbott Labs, Cutera, Coulter Pharmaceutical, Althea, Vivus
Diverse finance and operations management experience
Senior R&D Leadership at Gen-Probe, Incyte Genomics, Genta
Lyle Arnold, Ph.D. Founder/ Co-founder Oasis Biosciences, Molecular Biosystems, Aegea Biotechnologies
SVP, R&D and CSO Former faculty member, UCSD School of Medicine and member, UCSD Cancer Center
40 issued US and more than 140 issued and pending patents worldwide
Veena Singh, MD Board certified molecular pathologist, UCSD, Cedars Sinai trained
SVP and Sr. Medical Numerous publications, serves on CAP committees for oncology biomarkers
Most recently Medical Director – bioTheranostics
Director
More than 15 years in the biotechnology and diagnostics industry
Raaj Trivedi Served as VP of Marketing and VP of Business Development at Clarient – a GE Healthcare
VP Commercial Operations Company
Life Technologies Commercial Leader for Oncomine Biomarker Discovery Panel 7
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Multifaceted Growth Strategy
Sales and Marketing Investment
– Physician and hospital market for treatment decisions
– Biopharma and research services
– Collaboration and partnership agreements
Research and Development
– Clinical utility studies
– Validation of test in pipeline
– Enhanced technology
Operational Efficiency
– Investment in automation
– Optimize capacity of infrastructure 8
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2014 Accomplishments
Appointed Veena Singh as SVP and Senior Medical Director
Appointed Raaj Trivedi as Vice President—Commercial Operations Recruited a national sales team to support commercialization Implemented reimbursement and managed care plan Gained coverage for approx. 19M patients in large PPO network Awarded additional issued patents in Europe, China and S. Korea
Gained and expanded collaborations with MD Anderson, Rosetta and Insight Launched Clinical Research Services in Circulating Tumor DNA
Secured $10 Million Term Loan Facility With Oxford Finance LLC Increased menu of testing:
ER in breast cancer; ALK, ROS1 and T790M/EGFR in NSCLC and HER2 in gastric cancer. 9
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Target Market
925,030
Newly Diagnosed Cancers
8,009,272
Living with Cancer
– Incidence data for 2014 and prevalence data for 2010 of breast, lung, colon, prostate, melanoma, gastric and deaths data
provided by National Cancer Institute: http://seer.cancer.gov/statfacts/
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Liquid Biopsy Opportunity
“…liquid biopsies have a multi-billion dollar market potential that could eventually exceed $10B”
Cowen and Company Liquid Biopsy Industry Report, November, 2014
Profiling
Newly Diagnosed Cancers
In thousands
Monitoring
Patients Living with Cancer
DeSantis, et al (2014). Cancer Treatment & Survivorship Statistics 11
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Limitations of Tissue Biopsy
Cancer is a heterogeneous disease
– Molecular properties differ within a tumor
– Primary tumor biopsy may not reflect current disease condition
– Therapy causes changes in tumor cells Biopsy is invasive
– May not be feasible based on patient condition or tumor accessibility
– Impractical for periodic monitoring for progression / recurrence Biopsy tissue is limited
– Greater demand due to molecular profiling
– Surgery is costly
Liquid Biopsy Addresses Limitations in Standard of Care
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Reducing Healthcare Costs
Average cost of biopsy: $14,6341
Average cost when adverse events such as collapsed lung, bleeding or pneumonia occurred was 4X higher1
Average cost of blood draw: between $6 and $167 2
…. potentially saving our healthcare system billions
1Lokhandwala T, Dann R, Johnson M, et al. Costs of the Diagnostic Workup for Lung Cancer—A Medicare Claims Analysis. Presented at: 2014 Chicago Multidisciplinary Symposium in Thoracic Oncology; October 30-November 1, 2014; Chicago, Illinois. Presentation Number: 103. http://clearhealthcosts.com/blog/2012/12/how-much-does-a-blood-test-cost-it-could-be-16-or-117/
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New Molecular Paradigm
Liquid biopsy (CTCs and ctDNA)— surrogate for tumor tissue biopsy Repeatable for monitoring patient response to treatment Provides tumor biomarker status when tissue is not available Reduce false negatives attributable to heterogeneity Detect metastasis, recurrence and biomarker conversion Qualify more patients for targeted therapies
66% of researchers say analysis of CTCs will be the standard of care by 2017*
*CTC industry overview – Hanson and Wade 2013
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Platform Overview
ctDNA Analysis
B-Raf K-Ras EGFR
ZELBORAF® ERBITUX® TARCEVA® (erlotinib) (vemurafenib) (cetuximab) &
& IRESSA® (gefitinib) Plasma – ctDNA VECTIBIX® (panitumumab) Buffy Coat – CTCs Red Blood Cells
CTC Analysis
HER2 ALK ROS1
HERCEPTIN® XALKORI® XALKORI® (trastuzumab) (crizotinib) (crizotinib)
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OncoCEE CTC Testing
Circulating Tumor Cells (CTCs)
Plasma
Detection, enumeration and cytogenetic/molecular
analysis in blood or bone marrow samples
Buffy Coat –
CTCs
Red Blood Cells
CTC Capture ICC for Protein FISH for Genes
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CEE® Microfluidic Channel
ctc
Patented arrangement of posts optimized for ultra-sensitive rare cell capture Mounted on glass slide and transparent, enabling direct microscopic visualization of captured CTCs Multiple assays can be performed on captured CTCs Cells can be released for further analysis, including CEE-Selector mutation analysis, and is intended for next generation sequencing at Biocept or with industry partners
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OncoCEE™
A New Standard in Oncology Diagnostics
OncoCEE™ Platform CellSearch (J&J) Platform
Proprietary CTC antibody capture cocktail Single capture antibody
Not limited to “traditional” epithelial CTCs Limited to “traditional” epithelial CTCs
Captures more CTCs
Immediate post-capture biomarker analysis No biomarker analysis offered under FDA clearance
Tests for Breast, Gastric, Lung cancers Only available for Breast, Colon, Prostate with Colon, Prostate, Melanoma planned
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Published CTC Enumeration Comparison*
Traditional Definition of CTCs (CK+, CD45-, DAPI+)
100
CTC 90
?1 80
with of 70
60
50
40
of Cases Detection 30
%
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Positive 10
0
Breast (n=30) CRC (n=20) Prostate Lung (n=22)
(n=16)
Tumor Type
Biocept CellSearch
*Pecot et al, Cancer Discovery, Dec. 2011
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Biocept Technology Detects More CTCs
CK Positive/HER2+ CK Negative/HER2+
Traditional definition of CTC >50% of HER2 Positive cells are CK
Biocept captures more of negative* and are considered to be a these due to antibody tumor cell cocktail and microfluidic CK negative cells missed by channel design competitors
Biocept captures these types of cells
* Mayer et al. Cancer Genetics, 2011
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Ground-Breaking CEE-Selector Platform
Plasma – ctDNA
CTCs and cell free ctDNA for Genomic Testing
Buffy Coat – CTCs Red Blood Cells
B-Raf K-Ras EGFR
ZELBORAF® ERBITUX® TARCEVA® (erlotinib) &
(vemurafenib) (cetuximab) IRESSA® (gefitinib) &
VECTIBIX® (panitumumab)
CTC Capture
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Advantages of CEE-Selector™ Platform
Mutation determination sensitivity 10-100x better than competing platforms*
Allows for both CTC and cell free ctDNA analysis
Detects 1 mutation out of >10,000 normal DNA
Works with various nucleic acid targets (DNA and RNA) Compatible with sequencing and PCR instruments Multiplexing reduces costs and enhances reimbursement Potential applications in all stages of cancer
* Biocept internal data
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OncoCEE™ Product Profiles
Italicized and underlined biomarkers are currently available to Biocept customers
Product Tumor Type OncoCEE™ CTC CEE-Selector™
OncoCEE-BRTM Enumeration of CTCs,
Breast ER mutation
HER2, ER, PR
Currently no clinically actionable
OncoCEE-GATM Gastric Enumeration of CTCs, HER2 mutations identified
OncoCEE-LUTM Lung Enumeration of CTCs, ALK, EGFR, K-ras, B-raf mutations, ALK
ROS1, MET mutations
OncoCEE-CRTM Colon Enumeration of CTCs, EGFR K-ras, B-raf mutations
Enumeration of CTCs, AR, and
Currently no clinically actionable
OncoCEE-PRTM Prostate PTEN deletion (blood or bone mutations identified
marrow)
OncoCEE-METM Melanoma Enumeration of CTCs B-raf and N-ras mutations
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Established CLIA Facility
CLIA inspected and certified
CAP accredited for high complexity testing Manufacturing and lab operations in place Scalable for future growth Laboratory information system with client portal Adjacent clinical development and research facility Automation solutions in place
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Targeted Commercialization Strategy
Raise awareness of the value of CTCs and ctDNA
Drive OncoCEE adoption
– Market directly to oncologists and other physicians
– Develop key opinion leader speakers
Build relationships with patient advocacy groups
Publish studies with major cancer centers
Participate in medical meetings / symposia
Deepen payor relationships and expand reimbursement coverage
Expand strategic partnerships with pharma and biotech for personalized diagnostics
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Driving Adoption for Growth
Salesforce Plan Commercial Team
current 2015 2016 Head of sales and
marketing
Regionally based sales
team
Sales team for pharma
Managed care expert
Internal marketing
Leverage partner sales
forces
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Increasing Adoption
Commercial Samples Per Quarter
350 300 250 200 150 100 50
0
Q2 2014 Q3 2014 Q4 2014
Average reimbursement per sample YTD: $1,062
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Revenue and Reimbursement
Utilize established CPT codes for coverage today
– Medicare covers analysis component of testing
– Select private payors cover CTC capture, enumeration and analysis
– Seeking Medicare coverage for capture and enumeration Diversified revenue streams
– Grow clinical trial business and other fee for service channels
– Establish new revenue sources through partnerships Perform clinical utility study against tissue biopsy
– Health economics impact
– Goal is to show improved outcomes with reduced costs
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Clinical Studies
Columbia
Patients with ER positive metastatic and primary biopsy
Correlation of ER status – Biocept OncoCEE BR tm with metastatic and primary biopsy
Accepted for publication – pending review
Dana-Farber
Metastatic Breast Cancer patients with HER2 negative primary biopsy
CTC HER2 positive patients, as detected with OncoCEE BR, placed on Herceptin
22% of patients were Her2 positive on CTCs but negative on tissue
Sponsored by Genentech, Komen Foundation
MD Anderson
Published in Cancer Medicine – April 2013
Recently diagnosed breast cancer patients
15% of CTC and 28% of DTCs have HER2 discordance with primary tumor
Current Ovarian study – CTCs as predictive of outcomes
Other studies
Four additional peer reviewed published studies validating technology
Additional pending studies with collaborators
Planned study in Non Small Cell Lung Cancer
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Patent Portfolio
Biocept Developed Solutions
CEE-Sure™ Patented OncoCEE™ CEE-SelectorTM
Stability CEE® Chemistry: Antibody Mutation Analysis
Transport Tube Microfluidic Channel Cocktail Patent pending
Patent pending Patent pending
One US and associated Multiple issued patents in Two US and associated One US and associated foreign patents pending US, EU, China and foreign patents pending foreign patents pending Korea for capture; one US and associated foreign patents pending for detection
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Current Capital Structure
(as of 12/31/14—excluding shares in this offering)
Shares
Outstanding % Common Stock 4,449,603 72% Equity Awards1 1,157,812 19% Warrants2 610,774 9%
Fully Diluted Shares Outstanding 6,218,189 100%
1 Average option exercise price of $6.29
2 Average exercise price is $9.47/share
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Leading Cancer Diagnostic Companies
Sold 56% to Roche for $1.2B Market cap $241M* Sold to GE Healthcare $576M
Market cap $2.84B* Market Cap $1.043B* Sold to Novartis—$470M
* Market Cap close of market – January 16, 2014
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Investment Highlights
Commercial stage cancer diagnostics company with ground-breaking technology platform utilizing a simple blood test
OncoCEE™: captures circulating tumor cells (CTCs)
CEE-Selector™: enhanced sensitivity genomic mutation analysis
Commercialized tests for breast, gastric and certain lung cancers Test pipeline focused on solid tumor biomarkers in lung, breast, colorectal, prostate and melanoma Established, certified and scalable CLIA lab Clear path to market penetration Established research collaborations and strategic partnerships
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