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(OTCBB: SWME) PATENTED, CLINICALLY TESTED, OVER-THE-COUNTER, NATURAL CHRONIC AILMENT SOLUTIONS EUROPE 2005 Swiss Medica Inc. Raghu Kilambi, C.A., Chief Executive Officer confidential 1 Disclaimer Statements in this release that relate to future plans, events or performance are forward-looking statements reflecting management's current expectations, assumptions and estimates of future performance and economic conditions. All forward-looking statements are made in reliance on the safe harbor provisions of the Securities Act of 1933 and the Securities Exchange Act of 1934. The company cautions investors that forward-looking statements involve risks and uncertainties that may cause actual results to differ materially from those expressed or implied in such statements. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. The estimates and statements contained in this presentation were prepared on the basis of assumptions and hypotheses which the Company believes to be reasonable but which are subject to substantial risks, uncertainties and contingencies, some of which are difficult to predict and beyond the control of the Company, and which may result in substantial modifications. No assurance can be given as to the availability of any of the potential benefits described in this presentation and such information should not be construed as a representation or prediction that the Company will achieve or is likely to achieve any particular results. The assumptions and projections have neither been compiled, reviewed, nor audited by the Company’s independent certified public accountants and do not constitute a “Financial Forecast” or a “Projection” as defined by the American Institute of Certified Public Accountants. All figures used in the presentation are in US dollars. confidential 2 Strategic Opportunity Highlights • • • • • Patented, Clinically -Tested All Natural Over-The-Counter products Elite OTC chronic ailment solutions NOT vitamins / supplements 3 Products targeting multi-billion $ pain relief and anti-depression markets Replace / reduce the use of prescription and OTC products with side effects Penetration in 19,000 doors and growing in leading North American retailers Period Ending Q2/2005A Q1/2005A FY 2004 $1.38 million $1.13 million $0.6 million 1.13 million 0.94 million 0.5 million $(0.48) million ($1.22) million ($3.32) million Revenue Gross Margins EBITDA Market Cap (09/26/05) $20.0 Million Common Shares (O/S) 105 Million Common Shares (F/D) 121 Million 52-Week Range Current Stock Price (09/26/05) $0.46 - $0.06 $0.20 confidential 3 Industry Market Share Chronic Pain Market Chronic Pain Suffers (percentage) 350 million adults worldwide suffer from Arthritis and chronic pain, in some form. In the United States alone: 45 million + suffer from Osteoarthritis 10 million + suffer from Fibromyalgia 5 million + suffer from Rheumatoid Arthritis 65 million Americans suffer from back pains and aches every year. Four of five adults will suffer back pain at some point in their lifetime. Aging population will increase incidence of arthritic conditions. Additional conditions: Gout, Tendonitis, injuries, back pain, foot pain, neck pain, shoulder pain, etc 26% 46% 5% 23% Osteoarthritis Rheumatoid Arthritis Fibromyalgia Other confidential 4 Industry Market Share Chronic Pain Remedies Market In 2004, the worldwide market for pain relief products was estimated at $30 billion. Estimated Worldwide Pain Relief Remedies (percentage) OTC 19% Dominated by Rx/OTC pills Prescription pills $23 billion OTC pills $7 billion Other 7% Prescription 74% Consumers increasingly concerned about side effects and mixing prescription medications. Consumers increasingly desire to self-treat pain relief and other conditions. confidential 5 Drug Industry Concerns Troubles in $18 Billion Chronic Pain Market September 30, 2004: Merck & Co. withdraws Vioxx® Leading prescription pain pill: $2.5 billion revenues. April 7, 2005: FDA requests that Pfizer withdraw Bextra® from the market Also, requires Pfizer to include a boxed warning in the Celebrex label. July 22, 2005: PAIN MEDICINE; Survey on physician perception of Cox-2 Inhibitors In the wake of the withdrawal of Vioxx and Bextra from the market, fewer than one in five primary care physicians plan to prescribe COX-2 Inhibitors for treating chronic pain according to a nationwide survey by Pri-Med Institute. April 7, 2005, The FDA required that the package insert of all NSAIDs (excluding aspirin) be revised to include a “boxed” or serious warning to highlight the potential increase risk of cardio-vascular events. Pain Relief Market has new window open for a safe, natural topical alternative confidential 6 O24 Overview US-Patented, all natural, essential oil topical pain relief product line 7 essential oils, patented binding process that eliminates artificial binders that reduce absorption and efficacy Proven relief World class sports and medical endorsements from Europe, USA and Canada Extensive hospital, physician, pain clinic, chiropractor use Medical & Double-Blind Clinical studies from Europe and North America Previously used in Europe for athletes and doctors/hospitals 2 products: O24 Pain Neutralizer and O24 Fibromyalgia confidential 7 O24 – Natural Ingredients Patented binding process – No chemicals confidential 8 O24 Medical Studies confidential 9 Competitive Product Types O24 vs Other Pain Relief Products O24 Patented All Natural Lasting Relief Medical Studies Endorsements No Side Effects Economical Fast Acting OTC √ √ √ √ √ √ √ √ Drugs √ √ √ √ √ √ √ confidential 10 Retail Distribution Currently in more than 19,000 stores confidential 11 Swiss Medica Quarterly Store Count Currently > 19,000 stores 20,000 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0 Q4 04 Q1 05 Q2 05 confidential Q3 05 Q4 05 12 O24 Fibromyalgia Fibromyalgia syndrome (FMS) is estimated to affect between 2 to 4% of the world's population Is the second most commonly diagnosed disorder in rheumatology clinics, second only to osteoarthritis An estimate 10-million American have been diagnosed with Fibromyalgia Widespread and Chronic Pain Often effects all parts of the body Deep muscular aching, throbbing, twitching, stabbing and shooting pain Symptoms include: Pain, including tenderness on pressure points Fatigue Sleep Disorders Headaches Current pain treatment include acetaminophen or ibuprofen No other clinically tested product available in North American pharmacies confidential 13 O24 Fibromyalgia O24 Fibromyalgia is the FIRST product marketed specifically for Fibromyalgia pain to be available in North American pharmacies. It is a patented formula made from seven essential oils and has been clinically tested and shown to be an effective and safe pain reliever. O24 Fibromyalgia is the FIRST and only product to earn the coveted National Fibromyalgia Association’s Seal of Approval. The NFA has 2,000 affiliated support groups and sphere of influence of 1 million people. A double-blind clinical study conducted at University of Toronto found that 90 percent of patients who used O24 Fibro reported mild to markedly better improvement versus only 7 percent who were given a placebo. A full 54 percent reported moderate to markedly better improvement Launches in North American pharmacies and retailers in fourth quarter 2005. confidential 14 O24 Fibromyalgia – Q4 LAUNCH confidential 15 Industry Market Share Anti-Depressant Market Worldwide $17 billion Anti-Depression Market (percentage) 10% 28 million people in the US have taken an anti-depressant 400+ million adults worldwide suffer from some form of depression Worldwide drug market for depression treatment is more than $17 billion: Prescription Drugs – 90% of the market (significant side effects) 90% Rx OTC Products – 10% of the market (no proven treatments) Swiss Medica will launch safe, clinically proven alternatives to current Drugs and OTC products OTC confidential 16 PMS Escape Market Opportunity 200 million women worldwide suffer from mood and appetite symptoms associated with Premenstrual Syndrome (PMS) PMS Escape is the only clinically proven OTC product to address these conditions 100% drug-free Pleasant tasting powered drink mix Carbohydrate / nutrient blend PMS mood market opportunity is estimated at more than $2 billion World Class inventors of PMS Escape also invented Serafem, the only prescription drug for PMS mood symptoms Swiss Medica’s newly acquired ADBSI division will address the PMS market and expand to anxiety and stress related treatments PMS Intensity Level (percentage) Mild 30% Severe 20% Moderate 50% confidential 17 PMS ESCAPE confidential 18 PMS Escape: World-Class Clinical Studies confidential 19 Senior Management Raghu Kilambi, C.A., Chief Executive Officer, Co-Founder Chartered Accountant, seasoned executive and merchant banker Co-founder of FutureLink, raised US$225 million of equity and built a $140 million revenue business with a peak market cap of $2 billion Grant Johnson, President & COO, Co-Founder Seasoned operational & sales executive with a strong track record in selling consumer products & services; Experienced in building sales and delivery teams Bruce Fairbairn, Chief Financial Officer Operational finance at Canadian subsidiaries of NYSE-listed companies including CFO of both public and private Companies Thomas Quinn, Executive Vice President, US Operations Extensive experience in sales management and product launches with pharmaceutical and consumer packaged goods leaders including Procter and Gamble and Warner Lambert confidential 20 Senior Management Robert Esson, VP Robert Logistics and Supply Chain Management Senior Operations and Logistics executive with experience in consumer products (Quaker Oats) & cosmetics (BeautiControl Cosmetics). Wendy Kramer, Vice President Anti-Depression Biohealth Extensive background in generating new business for pharmaceutical and consumer healthcare Companies including Allegan, Inc. Mead Johns Johnson Laboratories and Warner Lambert/Parke Davis. Rob Klein, Vice President Strategy 10+ years in strategic planning, budgeting, financing and business development for various technology companies. In addition, was a ranked stock analyst covering Canadian Internet technology sector. Anne Dundon, Vice President Canadian Sales Strong consumer marketing experience in both consumer packaged goods (Proctor & Gamble, Revlon, and Bonnie Bell) and healthcare (Merck). confidential 21 Sales and Marketing Strategy DTC • Radio Talk Shows • TV, Newspaper, Magazine Editorials • Sampling and Store Demos • Targeted Advertising to Seniors & Minorities OPINION LEADERS ENDORSEMENTS • Doctors • Athletes, Trainers • Pharmacists • Celebrities Consumers • Chiropractors • Physiotherapists RETAILERS • Co-op Ads • Detailing Pharmacists • Displays confidential 22 Product Sampling confidential 23 PR oriented Radio Marketing confidential 24 Print Endorsements of O24 confidential 25 O24 in the News confidential 26 Manufacturing & Regulatory Standards Using FDA-certified contract manufacturers to manufacture O24 and PMS Escape USA Regulatory: O24 Classified as OTC drug: oversight of FDA/FTC FDA monograph controls O24 claims PMS Escape is approved for sale in the United States under the DSHEA regulations (Dietary Supplement) Canada Regulatory: OTC: Health Canada NHP registration for O24 and PMS Escape confidential 27 Growth Strategy Enhance Product Portfolio: Depression, stress product (organic) Cholesterol, Diabetes, Heart Ailments Professional Channel Distribution: Pain Clinics, Chiropractors, hospitals, other professionals Physician, Pharmacist Detailing: Trade shows, samplers, conference speakers International Distribution: Insurance Reimbursement confidential 28 Summary Elite, Patented, Clinically-Tested Natural Products for Chronic Ailments Drug /OTC Pain Relief & Depression markets have major side effect concerns Huge opportunity to capitalize on concerns about drug safety Expanding North American national retail presence Robust marketing campaign focused on sampling and public relations Growth from Professional Channels, additional products, international distribution, insurance reimbursement Strong management team with significant experience Significant revenue growth / EBITDA positive by Q4 2005 Sept 26th Market Cap: US$20million confidential 29 Comparable Valuations Public Companies Company Description Year End Price 7/25/05 Market Cap ($ million) P/E LQA P/E FY 2005E* P/Sales (TTM) OTC Products Nov 46.58 921.5 19.4x 20.3x 3.33x Fibromyalgia Phase III Clinicals Dec 13.50 410.5 NM NM 28.8x Biotech Patents Feb 2.88 214.9 NM NM No Revenue Paincare Holding (PRZ) Pain Mgmt Centers Dec 4.18 215.3 26.1x 16.0x 4.76X CV Technologies (CVQ.T) Patented OTC Products Sep 2.28 226.4 22.8x NA 11.3X Chattem (CHTT) Cypress Bioscience (CYPB) Biophan Techn. (BIPH.OB) confidential 30 Contact Contact Chief Executive Officer: Raghu Kilambi (416) 362-5775 [email protected] Investor Relations: David Jones (705) 495 0022 [email protected] www.swissmedica.com www.O24zone.com confidential www.pmsescape.com 31