conformis investor presentation may 2021 wo video.pptx

Investor PresentationMay 2021

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Forward‐Looking Statements

This presentation contains forward‐looking statements that involve substantial risks and uncertainties. All statements, other thanstatements of historical facts, contained in this presentation, including statements regarding our strategy, future operations,projected financial position, future revenues, projected costs, projected profits, projected margins, prospects, plans andobjectives of management, are forward‐looking statements. The words “anticipate,” “believe,” “estimate,” “expect,” “intend,”“may,” “plan,” “predict,” “project,” “target,” “potential,” “will,” “would,” “could,” “should,” “continue,” “grow,” “improve,” and“trend”, and similar expressions are intended to identify forward‐looking statements, although not all forward‐looking statementscontain these identifying words.

We may not actually achieve the plans, intentions or expectations disclosed in our forward‐looking statements, and you should notplace undue reliance on our forward‐looking statements. Actual results or events could differ materially from the plans,intentions and expectations disclosed in the forward‐looking statements we make. The forward‐looking statements contained inthis presentation reflect our current views with respect to future events, and apply only as of the date of this presentation. Weassume no obligation to update any forward‐looking statements.

Our business is subject to substantial risks and uncertainties, including those referenced in certain of our filings with the SEC underthe heading “Risk Factors.” You are encouraged to read our filings with the SEC, available at www.sec.gov, including our AnnualReport or Form 10‐K for the year ended December 31, 2020 filed with the SEC on March 4, 2021, as well as our Quarterly Reportson Form 10‐Q. You should give careful consideration to these risks and uncertainties.

© 2021 Conformis, Inc. Slide

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Expand hip product adoption

© 2021 Conformis, Inc.

Executing on Our Growth Strategy

• Surgeon adoption is still early stage• We have significant opportunity to drive new surgeon adoption

• We compete in a large and profitable market that is undergoing a shift in site of surgery• Procedural shift to outpatient / ambulatory surgery centers (ASCs) creates significant opportunity

• We are the clear leader in personalized hip & knee implants with a capital‐efficient delivery model• We are an innovator of the single‐use kit, sterile delivery model of implants and patient‐specific instrumentation (PSI)

Today Our Growth Strategy

Slide

Introduce Identity Imprint™, a new Total Knee Arthroplasty (TKA) system targeting the ASC & hospital outpatient facilities• FDA approved (May 2021)• Limited Market Release (2H 2021)

Generate value from PSI expertise & intellectual property portfolio

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4© 2021 Conformis, Inc.

• Founded: 2004• Headquartered: Billerica, MA• Ticker: CFMS• Global employees: ~260• International: Products sold in 18 countries

• Knees: Sold >125,000 personalized knees

Conformis – Positioned to Resume Growth

Key Statistics

Expanding Portfolio of Knee & Hip Implants

Comprehensive Dossier of Clinical and Health Economic Benefits

Recognized Leader in Patient‐Specific

Instrumentation and Personalized Implants

Proprietary Technology Platform with Broad Patent Portfolio

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A Paradigm Shift in OrthopedicsA personalized solution that delivers demonstrated value to physicians and payors

CT Scan• Surgeon orders and sends a standard diagnostic CT scan to Conformis

Restore the native anatomy using 3D modeling• Convert the imaging data into a 3D model

Create the patient-specific implant and instruments• Single‐use, patient‐specific instruments include guides and instruments necessary to fit our customized implants to the patient

Develop patient-specific pre-surgical plan• iView® allows the surgeon to visualize preoperative planning, including measurements, orientations and anatomic variants

Just-in-time delivery to the customer• Deliver implant, iJigs® and iView within 6 weeks

Digitally driven manufacturing• Produce custom implant and patient‐specific instruments

Patient-Specific Solution Delivered Just-in-Time in a Convenient Kit

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Our Personalized Solution in Action (Video)


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ASC Opportunity is Compelling


U.S. Joint Replacement Procedures in ASC settings

The shift in elective knee procedures to the ASC provides significant growth opportunity

Notable Drivers

0%

10%

20%

30%

40%

50%

60%

2016 2018 2020 2022 2024 2026

Procedure Shift to ASC2

Partial and Total Knee Procedures in 2024:

~370,0001

1) Company estimates based on projected shift in elective joint procedures.2) According to Sg2, a Vizient company.

• Medicare / Medicaid reimbursement change

• Bundled “Episode of Care”

• Physician ownership: capital‐efficient requirements

• Increased pressure on healthcare spending

• COVID‐19 protocol accelerates trend

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We Solve the Common Challenges Faced in the ASCHospitals and other medical facilities face similar challenges

Common Challenges Limited Processing Capability• 5–10 bulky instrumentation• Potential source of costly infections

• Substantial manpower costs


Limited Efficiency• All instrument trays require timely setup, break down, and sterilization

• Potential source of costly infections

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Conformis Solution

Limited Space• Tray management• Inventory storage• Supply costs

Single‐use kit, delivered before surgery

Set of disposable patient‐specific guides

One reusable instrument tray

99© 2021 Conformis, Inc. Slide

Identity Imprint™

Target U.S. Launch 2H, 2021

Targeting the ASC• Broader anatomical coverage than competitive implants1

• Implant size matched to patient’s knee scan• Approx. 3-week lead time• Full range of standardized poly thickness options• Product costs allows greater pricing flexibility • Select patient-specific instrumentation• Pre-packaged in a single-use, sterile kit with an iView

pre-surgical plan

iTotal® Identity™

Personalized Solution• Design to match each patient’s knee anatomy• Patient’s condylar shape and joint line are recreated• Approx. 6-week lead time• 3 patient-specific poly inserts• Premium priced solution • Custom made for each patient• Patient-specific instrumentation • Pre-packaged in a single-use, sterile kit with an iView

pre-surgical plan

Expand Portfolio with New Total Knee Replacement SystemNew product offering aimed at driving greater surgeon adoption

1) Company sponsored study.


• New Knee with Poly Options• Pre‐select implant size to best fit patient’s knee anatomy • Includes iView Pre‐Surgical Plan • Full range of polyethylene inserts for each surgery • Leverage iTotal platform1 with clinical outcome data• Broader anatomical coverage v. competitive Off‐the‐Shelf (OTS) knees2

• Shorter Lead Times• Pre‐packaged solution to be delivered within approx. 3 weeks

• Greater Pricing Flexibility• Ability to competitively price the product given new target product costs

• Aggressively Target ASC Facilities • Leverage unique delivery model to aggressively target the hospital outpatient and ASC spaces

Anticipated Benefits:

Same Efficient Solution with Better Pricing

1) Clinical studies on iTotal Total Knee Arthroplasty system.2). Company sponsor study.

Identity Imprint Offers Attractive Benefits Target product profile directly addresses surgeon feedback

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Product Gross Margin ImprovementSelect standardization enables lower cost of goods

Patient‐Specific Knee

2019

45%‐50%

2022 ‐ 2024

70%+

Identity ImprintValidated Targeted Production Savings Planned changes between platforms to reduce COGS

Significant cost savings opportunities with new ASC knee offering:• Eliminate implant design

labor cost• Lower femur casting costs• Less machining time • Improved material costs • Standardize production

quantities • Less scrap



Conformis Uniquely Positioned to Win in the ASC

Conformis Advantage: Right Product at the Right Price

Capital‐Light Delivery Model• Just‐in‐time delivery addresses sterilization / lack of inventory space

Pre‐Packaged Procedural Kit with iView • Total knee replacement‐in‐a‐box improves efficiencies

Partnership with Stryker® Validates Approach• FDA approval in April 2021

Attractive Target Price • Lower COGS allows aggressive targeting of the ASC segment

Conformis is the IDEAL SOLUTION for ASC Customers

iView

Re-usable Instrumentation

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Clinically Demonstrated Benefits

Safety & Efficacy

OUTCOME Publications & Conference Proceedings

Higher Patient Satisfaction • Reimann, et al. – Journal of Orthopaedics. 2019• Schroeder, et al. – Orthopaedic Proceedings of Bone & Joint Surgery. 2019• Katthagen, et al. – ICJR World Arthroplasty Conference. 2015• Ogura, et al. – Knee Surgery, Sports Traumatology, Arthroscopy. 2018

Better Alignment • Schroeder et al. – The Journal of Knee Surgery. 2018• Ivie, et al. – The Journal of Arthroplasty. 2014• Levengood, et al. – The Journal of Knee Surgery. 2017• Arbab, et al. – The Knee. 2018

Better Health Economic Outcomes• O’Connor, et al. – American Health & Drug Benefits. 2019• Buch, et al. – Reconstructive Review. 2019• Culler, et al. – Arthroplasty Today. 2017• Namin, et al. – Value in Health. 2019

Better Range of Motion • Zeller, et al. – British Association for Surgery of the Knee. 2017• Buch, et al. – Reconstructive Review. 2019

Better Functional Results • Zeller, et al. – ICJR Pan Pacific. 2016• Zeller, et al. – The Journal of Arthroplasty. 2017• Wang, et al. – International Orthopaedics. 2018• Reimann, et al. – Journal of Orthopaedics. 2019

Better Fit

• Koeck, et al. – The Knee. 2011• Carpenter, et al. – The Journal of Arthroplasty. 2014• Demange, et al. – International Orthopaedics. 2015• Schroeder, Lennart, and Gregory Martin (May 25, 2018)• Meier, et al. – Clinical Orthopedics and Related Research. 2019• Meier, et al. – Knee Surgery, Sports Traumatology, Arthroscopy. 2019

Demonstrated in:

50+ Clinical Studies

30+ Peer‐Reviewed Publications

© 2021 Conformis, Inc. 13Slide

UK National Registry

Cumulative revision rate of the iTotal® CR implant of 1.5% versus 2.1% for

1. More than 60 surgeons in the UK have implanted over 1,000 iTotal® CR implants with a five‐year cumulative revision rate of 1.5% versus 2.1% for all other total knee replacements in the NJR

other total knee replacements in the NJR1

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Conformis Re‐Defining Patient Satisfaction

Conformis patients are more satisfied with their outcomesand are more likely to recommend Conformis


Improve Patient Reported Satisfaction & Overall Quality Measures Grow Referral Base

p=0.007 p=0.003

Conformis Patients 77% vs Non‐Conformis Patients 36%

2.1x

Patients who respond as ‘Extremely Likely’

recommend Conformis 2.1x more than Off‐the‐Shelf

p<0.0001

Patients responding 8‐10, where 10 is extremely likelyPatients responding 8‐10, where 10 is most satisfied

1) Company sponsored research study conducted in 2018 assessing post TKA patient satisfaction (~210 respondents)

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1515© 2021 Conformis, Inc.

1) 2019 ORTHOWORLD®. The Orthopedic Industry Annual Report. 2) U.N. data, 2019.

Expand surgeon adoption with an innovative portfolio of custom and standard hip implants

Hip Portfolio

Life expectancy continues to increase, global population is gaining weight, and individuals desire to live a more active lifestyle2

$8B global hip market is projected to grow in the low single digits1

New & Expanded Hip Platform Drives Additional GrowthHip product introductions double addressable market opportunity

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Conformis Solves Total Hip Replacement (THR) Challenges

Challenges: Notable Drawbacks with THR

• THR Traditionally is an UNGUIDED Operation• Heavily dependent on training, skill, and experience of the surgeon

• 2D‐Templating Can Be Inaccurate • Neck angles and offsets can be dramatically affected by rotation on x‐ray

• Standard Hips Offer Limited Neck Angles, Offsets• Capital‐intensive delivery model, implant & instrumentation

• Leg length / offset issues after THR

• Patient Dissatisfaction1 and Revision Rates2

Solution: Apply Conformis Philosophy

1) Jones, et al., and Anakwe et al.2) Labek, et al.

• Conformis Hip Systems uses 3D imaging technology to provide PRE‐SURGICAL navigation of the patient’s specific implant for restoration of patient anatomy

Total Hip Replacement-in-a-Box

• Patient‐specific instrumentation improves efficiencies

• iView surgical planning tool helps guide surgical procedure

• Hip system offers a range of femoral neck options

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Developing a Multi‐Line Hip PortfolioCapital efficient delivery model remains central to the product offering


Customer Preference Guides Level of Customization

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Proprietary iView provides a personalized

surgical roadmap

Unique, sterile personalized guides and bone models

streamline the surgical procedure

iView Pre‐Surgical Plan Patient‐Specific Instrumentation Product Portfolio

Acetabular iJigs Cup positioning iJigs –provides a plan and check for the cup

Femoral iJigs – guide the neck & broaching orientation for the stem

Two‐stage disposable reamers

Bone models –replicate the patient's anatomy

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New Product PipelineRobust pipeline drives growth

2020

LMR = Limited Market Release; FMR = Full Market Release


Hip• Total Hip Product• Hip Line Additions• Cordera Standard Hip Stem• Hip Fit Analysis Software• 2nd Hip Stem Design

ConformisTotal Hip System (FMR) Cordera

Standard Stem

Hip Line Additions

Knee• iTotal Identity CR• ITotal Identity PS• Constrained Poly Options CS/PS• iTotal Identity Cementless System• Identity Imprint (ASC)

iTotal Identity(FMR)

Hip Fit Analysis Software/ Cordera Match1

1st half 2nd half 1st half 2nd half 1st half 2nd half2021 2022

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Identity Imprint(FMR)

Identity Imprint:

Cementless(LMR)

2nd Stem(LMR)

1) Company announced U.S. full market release of the CorderaTM Match Hip System – December 2020

Identity PS Q4, 2020

Private LabelStryker PSI

• Knee PSIAdditional Opportunities

Constrained Poly (LMR)

iTotal IdentityCementless

(LMR)

Identity Imprint (LMR)

CorderaTMQ4, 2020FMR

FMR Key Product Launches

iTotal IdentityCementless

(FMR)

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Strategic Partnership: StrykerCollaboration adds another profitable growth driver

© 2021 Conformis, Inc. 19

Leveraging the strengths of the respective organizations to further expand personalized care into low‐cost, site‐of‐care settings / ASC

Conformis will develop, manufacturer, and supply patient‐specific instrumentation for use in connection with Stryker’s market‐leading Triathlon® Total Knee System

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1) Stryker is a registered trademark of Stryker Corporation.

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Strategic Partnership: StrykerGeneral product overview


1) Triathlon is a registered trademark of Stryker Corporation.

Conformis

Stryker

Set of 3D printed, disposable patient‐specific cutting guides

iView Pre‐Surgical Plan

Triathlon+

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Reusable Tray(s)

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Stryker: Private Label OpportunitySignificant revenue and profit potential

© 2021 Conformis, Inc. 21

Stryker is a leader in the U.S. primary knee reconstruction market

$30M• $30 in non‐dilutive

payments• Long‐term supply

agreement

Collaboration:Capitalizing on Partner’s Strengths

Revenue from private label products offers potential to drive 10%–20% of Conformis’ overall revenue by 2024

Leadership Position:U.S. Primary Knees1

ASC Opportunity:Shift in Knee Procedures2,3

Revenue Potential for Conformis

Partnership validates Conformis’ expertise in design, development, and manufacturing excellence of PSI

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~30% Share ~240,000 Units

Projected shift in knee procedures to ASC offers significant opportunity

1) 2019 Orthoworld. ‐ the Orthopedic Industry Annual Report and management estimates prior to the emergence of COVID19. 2) Management estimates based on projected shift in elective procedures.3) According to Sg2, a Vizient company.

10%‐20%10%‐20% of total

Conformis revenue in 2024

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We Plan to Create Significant Shareholder Value2024 Financial Targets


RevenueCommitted to double digit

revenue growth

Gross MarginDeliver improved gross margins

$160M ‐ $190M

ProfitGenerate meaningful operating income

$15M ‐ $30M60%+

• New product introductions• International market expansion into India, China, and Japan

• Supply of private label products

• Growing contribution of higher margin knee and hip products

• Introduction of profitable private label products

• Scale business, leverage operating expense

• Improved cash flow • Accelerates time to breakeven

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Anticipated hip product adoption further accelerates revenue growth


Private label products drive additional profitable growth

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Conformis

New knee targets ASC procedure growth and drives gross margin expansion11

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New Growth Drivers Create a Compelling Investment Thesis

Thank You!

conformis investor presentation may 2021 wo video.pptx

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