EFTA00605809.pdf

Check-Cap Creating a new standard of colon 3D imagery May 2014 Non Confidential EFTA00605809  Company Overview Founded - 2005 Ow Corporate Headquarters - Carmel, Israel Employees - 35 Investors — Overall $25m Raised Cash $3.2m as of May 2014 through March 3152 2014: Current Burn Rate - - $400k GE Ventures, Pontifax Ventures, Jacobs Investment (Qualcomm), Target Bridge - $6-8m Counterpoint, Docor, BXR Partners, Insider Participation - $3-4m Emigrant Saving Bank, Biomedix (BMDX:TASE) & more. Most Recent Valuation (2012) - $64m 2 iliircap EFTA00605810 A patient friendly screening method First imaging capsule for Colorectal Cancer screening (CRC) I No bowel cleansing required Designed for increased compliance Cap EFTA00605811 Check-Cap Our vision To become the leading suppl ier of colon cancer screening technology and significantly reduce global mortal ity from CRC. ti EFTA00605812 "The most preventable, yet least prevented cancer" —Journal of the National Cancer Institute EFTA00605813  The importance of CRC screening Structural Tests - enable both Polyp Detection and Cancer Prevention Stool / Blood Tests - enable Cancer Detection Highly Survivable in Early stages Spell to other er-porM1 Mama Stage I 93% trMa, Mood fig/ vessel Stage II 72-85% Stage III 44-83% Stage IV 8% Testing Compliance Key Less than 50% of the recommended population in the U.S is screened for CRC, while less than 30% is screened in Europe. Illustration courtesy of the Notional Cancer Institute 6 qiiirCap EFTA00605814  Compelling Market Size Target population of 365 million people aged 50 to 75 in U.S, Europe and Japan. > 36 million require screening annually.(1) Population between op • USA Europe 50.75 2015 89,545 233,971 2016 90,996 236,374 2017 92,179 239,113 2018 93,182 242.268 2019 94,297 245,372 2020 95,618 248,526 irr Japan 41,397 41,071 40,889 40,843 40,814 41,002 TOTAL 364,913 368,441 372,181 376,293 380,483 385,147 > $18 billion total market opportunity per annumm (1) Assumes one screening for members of the target population every 1O years. (2) Based on an average selling price of $5OO. 7 EFTA00605815  Attractive Market Opportunity Poorly • Current technologies may compromise accuracy or patient safety and comfort Addressed by • Colonoscopies involve significant risks and require aggressive bowel cleansing Current Methods • Patient compliance levels far below those recommended by physician societies Check-Cap • Does not require uncomfortable bowel cleansing_necessary for other methods Offers a • Innovative and proprietary technology platform avoids traditional issues Differentiated • Designed to be attractive to physicians and patients, increasing patient compliance Solution 8 EFTA00605816 Reasons for Avoiding Existing CRC Screening Procedures Other Computed reasons 8% Laxative Tomographic Embarrassment Preparation Colonography a 32% 11% Camera pill %.a Concern over pain 13% Fasting requirements Insertion of 15% tube 21% Check-Cap imaging capsule addresses all these concerns Source: Mayo Clinic Proc. 2007;82(6):666-671. Figure 1, Most troubling part of colon testing. Responses to the question, "What do you feel is the most troublesome part of colon testing?' 9 EFTA00605817  Detection of polyps > 50% (Cancer Prevention vs Detection) Current Primary Modalities Safety Comfort Pre-Cancerous Efficacy* Key Competitors Colonoscopy X v n Cross Infection n bowel cleansing Embarrassment 1 Sensitivity - 95% Specificity - 95% OLYMPUS PENTAX PHILIPS Computed Tomographic v Insufflation y bowel cleansing Sensitivity - 85% Colonography (CTC) Radiation X Pain Specificity - 95% SIEMENS OLYMPUS X_ bowel cleansing Sensitivity - 70% ssfa.- Optic Capsules Ni&O) Vt Specificity - 85% GleING Fecal Occult Blood Test 1 V X Sensitivity - 23% Specificity - 97% I O O 00 Sensitivity - 42% \I Stool DNA exact oZS Specificity - 87% stierces In clinical trials t.) CU Li- x Sensitivity - 50% Blood Tests In clinical trials 1 V Specificity - 90% epigenomics io dip Imaging Capsule 1 V / Target Sensitivity > 80% Target Specificity > 90% In clinical trials EFTA00605818 / The Check-Cap Solution EFTA00605819  Check-Cap -maging Technology ti ttering X-ray Fluorescence Less contrast = Less Absorption - Increase in Comptons Compton backscattered flux of photons detected The x-ray Florescence flux detected by by the capsule are attenuated by the colon the capsule's detectors depends monotonically on the contents in direct proportion to their distance distance traveled in the colon contents mixed traveled in the colon contents, as some of the Capsule in Standby Mode with the contrast agent photons are absorbed by the contrast agent Capsule In 12 EFTA00605820 3D Capsule Technology vs. Optics EFTA00605821 3P Image Reconstruction I Cap CapScanViewer 1OA STUDY - Nov. 2014 Erasmus MC University Hospital, Rotterdam ID-AB20166585 Dr. Amer Pil" Bookmarks Standart 30 O 2 45 • itl Psptay cottons v trans line (4; Ground Piano measurements o (i) tcokmarks It — qua The data viewer EFTA00605822 Trial Clinical Data Reconstruction (3D) EFTA00605823  Clinical Proof of Concept "The Check-Cap novel imaging technology has been proven to be safe and feasible in our preliminary clinical experience. It has successfully demonstrated imaging of prep-less human colon at ultra-low dose compared to existing X-Ray based modalities. These results underpin the great potential of Check-Cap imaging technology to become a very appealing tool for screening of pre-cancerous polyps and colorectal cancer. Once efficacy is demonstrated, this clearly could make a fantastic impact on screening and consequently on survival rates from this disease" > Professor Nadir Arber, Head of Integrated Cancer Prevention Center, Tel Aviv Sourasky Medical Center, Israel 16 EFTA00605824  Clinical proof of concept — Demonstrated Capabilities - 3D imaging and representation (with no preparation) - Reliable correlation between Compton Backscattering & X-Ray Florescence data, leading to clinical diameters values - Automatic scan in motion triggered by predefined Activation Algorithm settings - Colon segment position data with high accuracy - All subjects reported smooth passage of capsule along the GI tract - Acceptable surface imaging using ultra low dose accumulated during procedure - Contrast material (oral) well tolerated by subjects Quantitative colon surface detection and reconstruction along movement track Results of studies suggest procedure is safe and uneventful Results of first studies indicate that the current lower limit for visible feature size is 5- 6 mm, and —10mm polyps should be well within the imaging capability of the Check-Cap capsule. We believe that improvements in hardware and algorithm should enable us to decrease the lower limit of visible feature size to 2 mm, to provide high detection rate for 5 mm polyps & very high detection rate for 10 mm polyps. 17 EFTA00605825 Clinical Trial Data Reconstruction Stages (fused CMT and XRF) - PP100204_P42-Scan01 Reconstruction Stages (fused CMT and XRF) 1. Preprocessed 2. Fillet 3D Reconstruction 3. Tubed 3D Reconstruction ellitill e 4. Path 3D reform 18 EFTA00605826 Commercializable Tracking System ELS III — Preliminary concept II Receiver Unit including Position Tracking System Disposable Patch on Patient's Back Capsule ego in Colon S Receiver I2F Data Download Check-Cap 3D VIEWER Check-App - Patient Interface EFTA00605827 X-ray radiation control Low Energy Low Radiation Exposure Typical Organ Radiation Doses from Various Radiologic Studies 16 mSv 14 12 As reference. below is Data from the National Council on Radiation Protection and Measurements. 'Ionizing Radiation Exposure of the Population of the United States' March 3. 2009: 10 CT procedure Range for effective dose (msv) Chest 4-18 8 Abdomen and pelvis 3-25 Virtual colonoscopy 5-15 6 Whole-body screening 5-15 Angrography. heart 5-32 4 2 0 Check-Cap Dental Lateral Chest Screening Adult Barium Enema Imaging Radiography Radiography Mammography Abdominal CT giiircap EFTA00605828 Clinical Data Generation Motility Clinical Trial First clinical cases of Clinical the Imaging Capsule Proof of Concept Completed Sample size - 60 subjects. Completed Completed Site — Hamburg, Germany. • Sample size - 10 subjects. Site — Tel Aviv Medical Center. End points: End points: GI Motility information Safety — Demonstrated. for Activation Algorithm. Feasibility — Demonstrated. FDA Pivotal trial CE Pivotal trial Sample size — 800 subjects. Sites — 10 in the US, 5 in Europe. End points: Safety — Continued. Feasibility — Continued. Image resolution, Polyp Imaging. Sample size — 40-60 subjects. Sensitivity & Specificity in detection of polyps 10 mm & above, 6-9 mm: Sites — 2 in Israel, A i. • I I Compared to upuLai culuilustupy. 1 in the Netherlands, possibly 1 more. B. Possibly on specific segments: End points: Clinical surveillance. Safety — Continued. Patients negative FOBT when additional info is needed. Feasibility — Continued. Patients with incomplete colonoscopy. Patients who cannot tolerate prep. Image resolution, Polyp Imaging Patients with tortuous anatomy etc. EFTA00605829  Anticipated Development, Clinical & Financial Roadmap Q3-Q4 2013 2014 Product Clinical Activation & Clinical Reconstruction algorithm op 2nd Gen Capsule Development Development (Design freeze @ O4/14) Inc. cost reduction and optimization TLV Hospital TLV & Erasmus (NL) Clinical Proof of Post marketing C.E Trials & Concept (5 par.) CE Pivotal in Europe European Clinical AA (50-60 par.) (200 participants) Market (10 par.) Request US Trials & US Protocol, site selection for US Pivotal Trial Regulations FDA trial 800 participants and study design initiation EFTA00605830 Reimbursement Aspects Current Status Our Strategy Covered for CRC screening*: • Collect information about expected FOBT increase in screening adherence rate Barium Enema (expected increase > 25%) Flexible Sigmoidoscopy • Collect information about direct and Optical Colonoscopy indirect Costs (expected decrease > 15%) • Emphasized findings are limited to Not Covered for CRC Screening Yet: intra-colon only (as opposed to CTC) CTC (Covered by some private insurers) • Utilize capsule endoscopy value story Stool DNA to demonstrate cost effectiveness Colon - Capsule Endoscopy: • Penetrate private insurers first as Given's capsule received FDA clearance differentiating service Cost effectiveness models have been • Work with ACG, AGA, ACS to achieve designed for Europe reimbursement as quickly as possible SB & ESO capsules are covered * All Medicare beneficiaries age 50 and older are covered; However, when an individual is at high risk, there is no minimum age required to receive a screening colonoscopy or a barium enema rendered in place of that screening colonoscopy. EFTA00605831  Reimbursement Aspects ea Original Bride Cost-effectiveness of capsule endoscopy in screening for colorectal cancer Cost of treating CRC is kW/Nets n•V tut cs. C Hawn. A. Sub. S WS.. ihlorrini ---rar.r.-iv ore dr? urn. redo..op/ tint. 'Cava fo•gets V.rror ea' rt.'s; Roan Ray $14 billion annually in the US and $99 billion mondiad taw* NW sm.., Aar 'aria:. Sabre...ad and study arm Caplideendoscopy t Minim Cdon • hn recent shmvn acapUble rancopy and cipauk adman was d 16 le and $2, 244 pa hIc- war favtrd. regret twit globally * t t r ... until colonoscopy adherence was decreased to 83%, corresponding to a 17% difference in adherence between the two strategies." 17% increase in adherence = capsule endoscopv more cost effective than screening colonoscopy EFTA00605832  New Health Care Law One benefit of the new health care law: Free colon cancer tests 1 in 3 U.S. adults have never been screened but will now have coverage for this and other preventive services Published: November 07. 2013 10:30 AM If you've put off getting screened for colon cancer because you didn't have health insurance, there's good news. Under the new health care law. colorectal screening tests are availble at no cost to you. About a third of U.S. adults ages 50 to 75 have never been screened for colon cancer or are not up to date with screening recommendations, according to a new survey from the Centers for Disease Control and Prevention. And more than half of those people had no health insurance. But through the new health law, more Americans will have access to health coverage and preventive services such as colorectal cancer During a colonoscopy. doctors can detect and screening tests. remove polyps (shown here in red). 25 EFTA00605833  Bridge Financing • Target raise: US$6m. Minimum: US$4m; Maximum: US$8m • Terms highly attractive: Discount 25% Interest 5% Warrant coverage 100% * * Warrants for four years, at 120% of Offering price 26 EFTA00605834  Intellectual Property Check-Cap has received patent grants from the U.S. patent office as well as from China, EPO, Japan, Hong Kong and India for the core technology — "Intra lumen polyp detection". Our granted patents (2010-11) cover an ingestible capsule with a radiation source and radiation detectors that, when used in conjunction with a radio opaque contrast agent, is adapted to detect clinically relevant findings in the colon. Utilizing X-ray florescence and Compton back scatterings, the capsule is able to measure the distance between the capsule and the colon wall and to distinguish between gas and clinically significant findings in the gastrointestinal tract. EFTA00605835  Company Leadership Management Team • Guy Neev - CEO since March 2008. 14 years of executive management experience. Chief Executive Officer at Cappella. Business unit manager at Boston Scientific. • Alex Ovadia - VP of since January 2013. 11 years of experience in managing complex projects at Philips Medical. 10 years of development management positions at Elbit Systems. • Yoav Kimchy - Founder and CTO since Feb 2005. 12 years of executive experience Vice President at V-Target Ltd. Director of cardiovascular research at Impulse Dynamics Ltd. • Lior Torem - CFO Since Mar 2010. Strong Chief Financial Officer experience in both private and public companies. CFO at Tigo Energy Vice President of finance at Actelis Networks Inc 28 EFTA00605836  Scientific Advisors Dr. Douglas K. Rex - Professor of Medicine, Indiana University School of Medicine rIll Dr. Perry Pickhardt - Professor of Medicine, University of Wisconsin Medical School Dr. Peter Fitzgerald - Professor of Cardiology, Stanford University Medical School Dr. Nadir Arber — Professor of Medicine, Tel Aviv Medical Center Steve Hanley - Former President, Covidien's Imaging Solutions unit *Partial list 29 EFTA00605837  Summary • Target Bridge raise: US $6-8m • Innovative disruptive technology with clear competitive advantage • Very attractive market opportunity • Feasibility & safety clinically proven • Well defined regulatory pathway • Core patents granted in all major territories • Seasoned management & advisory teams Oos • Leading and committed investors p 30 VIEW. (T334-App • PM. WNW< 30 OFop EFTA00605838 Thank You es EFTA00605839