NAYA Biosciences, Inc.

Thank you, Robert. Good morning everyone, and thank you all for joining us today.

On behalf of the entire INVO team, we appreciate the support from all of our shareholders. We are hosting this initial call, as Robert mentioned as part of our go-forward strategy to expand the dialogue with our shareholders on an ongoing and more frequent basis.

The key part of our shareholder communication strategy also involves expanding upon the current shareholder base. Although we are a public company and have been for some time, not in our potential public market investors are aware of the company and its unique opportunity.

We are participating in a very large and growing market with an innovative patented FDA cleared technology. I believe this will resonate with investors as we continue to build our business and increase the adoption of INVOcell in the global fertility marketplace.

Today's event is one forum we will utilize to build awareness in the company and we have plans for many others in the future. We did receive some questions from several of you and have attempted to address many of those in our opening comments today.

For this initial call, I'd like to spend a little time going over the history, our products, our markets and our recent execution on our business plan. I understand that part of this may be repetitive to many of you, but it's important to lay a base foundation particularly for our newer investors.

We have developed an FDA approved medical device the INVOcell, which we believe is a disruptive technology. Our solution is aimed at addressing infertility in a novel and distinctly different manner.

To simply describe that key difference, many people are generally familiar with In Vitro Fertilization, IVF. One of the key steps in the overall IVF process involves combining eggs and sperm in a culture dish and then placing it in a sophisticated and expensive laboratory machine or incubator for five days, which allows the fertilization process to occur with the goal of creating an embryo that can then be transferred into the patient.

By comparison, the INVOcell is a small, wine cork sized clear, medical grade crystal styrene capsule that holds the egg and sperm, which is then placed inside the vaginal cavity rather than any lab incubator, and thereby allows the patient's own body to act as a natural incubator. This is why we frequently refer to our device and procedure as being more natural and the world's only in vivo in body fertilization solution.

The history of the device date probably back to 1985, when Dr. Bob Bruno [ph] originally developed the concept while running his own fertility clinic.

The system was approved by the FDA in November 2015 through the De Novo pathway, and only more recently are we starting to see more commercial traction. As some might say an overnight success 23 years in the making.

It's been a long journey for the technology and the company, but we believe, we have the opportunity to accelerate from here and speaking for the whole team, we're excited by the development now unfolding. One of the most important commercialization milestones just occurred at the beginning of this year was the signing of our U.S.

agreement with Ferring Pharmaceuticals, the number one woman's drug fertility company in the world. Under that agreement, Ferring is now in charge of the U.S.

commercialization process for INVOcell. This agreement provided us with a world class partner to move forward within the U.S.

marketplace. As part of that agreement, we receive a $5 million upfront cash payment with the opportunity to earn an additional 3 million milestone payment based on the achievement of regulatory label enhancements to the device.

In addition to the upfront milestone payments, we also earn ongoing product revenue under the Ferring agreement. We remain responsible for manufacturing the device and sell finished product to Ferring at a fixed rate.

Ferring agreed to annual minimum purchase requirements in order to maintain exclusivity, and those annual purchase minimums escalate each year during the seven year initial term of the contract. They have performed well in this initial kickoff year and have already exceeded the first year revenue requirements.

But it's also important to note they and we have really just begun, we are still in the early launch phase. Prior to signing the agreement with Ferring, we had initially launched the product with a minimal budget and mostly from word of mouth.

But with that initial foundation built, we believe Ferring’s support and their tremendous sales and marketing capabilities can take the product to the next level here in the U.S. I also want to thank the Ferring team; they have been a fantastic group to work with.

Stepping back for a minute, I want to take a few minutes to highlight the overall marketplace and some of the unique dynamics at play. First, the global infertility market is very large estimates vary, but it's certainly in the billions of dollars spent annually perhaps as high as 20 billion.

The market is growing fast, many estimates suggesting an 8% to 10% range which is very healthy for a large multi-billion dollar industry. And fertility rates in many parts of the world are increasing, a contributing factor to the growth rate.

And perhaps the most amazing thing is how vastly underserved this market is. Only 1% to 2% of the patient population in need of fertility treatment are actually receiving care, so there is a huge amount of pent up or potential demand for service.

These dynamics exists right here in the U.S. market as well with approximately 220,000 IVF procedures conducted annually and many more IUI procedures, the U.S.

market is now approaching a $4 billion to $5 billion in size, however, as significant number of potential patients at least 1.5 million or more annually are going untreated each year. And again, this is the same dynamic for most parts of the world.

It certainly represents a key factor in a large number of patients going untreated each year. In the U.S.

patients often have to pay for treatment out of pocket. Put a finer point on the cost barrier to treatment, some analysis indicates that a 50% reduction in the price of IVF services would translate into 160% increase in utilization of such services.

INVOcell has that potential to decrease costs, which provides the opportunity to expand the overall addressable market We believe this was a key attribute driving Ferring’s decision to partner with us, given our ability to open the market to a larger population. While cost is one element to treatment, and other key barrier to treatment is availability, or accessibility, sometimes we refer to that as industry capacity.

Due to high upfront infrastructure costs, there are a limited number of IVF centers and many of them tend to be concentrated in heavier population areas, which also ties back to the cost of service. Patients must -- many patients that must travel to a center further adds to the overall cost of their treatment.

And the limited number of centers create this supply dynamic that probably also supports higher service costs. We believe INVOcell has the ability to address these two key issues.

We already have clinics offering INVOcell here in the U.S. at much lower cost than traditional IVF We also inherently believe that our more natural process is also a more emotionally connecting experience for a couple with the actual fertilization occurring inside the body rather than any lab incubator.

So the real critical question we must further address and support with strong data in the marketplace is how INVOcell really performs in terms of pregnancy success rate. By way of background, our original clinical study was based on two very critically important facts to understand as compared to IVF.

Our study was based on a three-day incubation period, the IVF world has moved to a five day incubation period as the standard. Our study was also based on a lower drug stimulation protocol and hence fewer eggs used then compared to what is common practice with IVF.

As I mentioned in the shareholder letter recently, we are planning our clinical study to achieve five-day label enhancement. We have our industry veteran in clinical and regulatory affairs, Lori Kahler, managing this effort along with the help of Dr.

Kevin Doody, our medical director. There are three critical reasons for doing this as a reminder.

As part of the Ferring agreement, if we conduct a clinical study and achieve five-day expanded labeling claim from the FDA, we receive an additional 3 million non-dilutive milestone payment from Ferring. This is one of the three critical reasons for doing this study.

The other two key reasons involved allowing us to officially market five day usage as well as demonstrating clinical success with five day incubation. Thus once we finish this clinical effort and new FDA 510K submission, not only can we and Ferring market five day incubation, we expect this will result in improved pregnancy and birth rates comparable to current IVF five day success rates.

We estimate this study will cost us approximately 600,000 and are targeting completion in 2020. As I mentioned, costs and general accessibility or industry capacity playing key roles in the huge underserved patient base.

There are a number of reasons why INVOcell provides an opportunity to address cost and access, including lower drug costs through lower stimulation, fewer doctor visits, less need for expensive overhead, lower embryologist costs, including the absence of manipulation for fertilization and cultural media change during the five days incubation within both, so the patient is sent home for five days and there's no ongoing lab management to do during that period. And overall lower labs setup costs and INVOcell lab could be established for a fraction of the cost of an IVF lab.

We also believe our device reduces the risk of wrong embryo transfer and provides a more stable and natural environment for the embryos. In summary, INVOcell is not only the first significant new product to address fertility in more than 30 years; it does so with a number of important advantages.

We are less expensive with comparable efficacy rates. We offer a more natural fertilization process since the device and therefore the eggs and sperm are with the patient at all times, and not in an incubator where patients feel more involved in the process.

This connection to the process also benefits by eliminating the risk of wrong embryo transfer. We allow for greater accessibility, and one item that has not been mentioned yet, some have expressed concern over IVF treatment, the INVOcell procedure provides an alternative to those with certain religious and cultural reasons, as with the INVOcell conception takes place in vivo within the woman's body.

Our last comment on our U.S. strategy, as part of our agreement with Ferring, we did retain turn limited right to establish a few INVO only clinic that exclusively commercialize INVO cell cycles in the U.S.

We are still in the planning phases of how best to engage those activities and look forward to updating you on our progress. With U.S.

commercialization in the capable hands of Ferring, we have turned much of our internal attention to the commercialization of the INVOcell outside the U.S. To head up these efforts earlier this year we had Mike Campbell as our COO and Vice President of Business Development.

Mike was most recently the Vice President of IVF, America's Business Unit Worker for Cooper Surgical. Mike has substantial medical device sales and business development leadership experience within Global Fortune 500 and Start-up Company Environments.

During his 12-year career at Cooper, he was responsible for the IVF Product Portfolio sales globally in the U.S., Canada, Latin America, Europe, Middle East, Africa and Asia Pacific regions. So with that, I'd like to turn the call over to Mike for a few minutes to discuss some of our strategies internationally.

Mike?

Thanks Steve. As Steve mentioned, as a component of the agreement with Ferring, we have retain the commercialization rights to the product outside the U.S.

And one of our primary business objectives going forward is to enhance the rapid adoption of the INVOcell solution across the globe. We're going to do this by entering into commercialization agreements with distributors that are incentivized to support the product, typically by creating agreement that include minimal purchase requirements or similar arrangements.

Fortunately, we have the advantage of having the FDA clearance which helps streamline the regulatory process to many, although not all international market. And additionally as most of you know, last month we receive the CE Mark, which permit us to do commercially distribute the INVOcell throughout the countries of the EU.

So, Steve along with myself and Mr. Pressly Ahammed, our Director of International Business Development have spent the better part of this year develop, include international distribution channels and relationships with folks in Europe, Middle East, Africa and parts of Asia.

So we recently kicked up our planned world-wide rollout of INVOcell with the first of our international commercialization agreements for the Continent of Africa; these cover Nigeria, Uganda, Sudan and Ethiopia. Africa is a highly populated, yet very underserved in fertility market.

We believe the INVOcell is a perfect solution for the African Continent where access to assisted reproductive services remains a biggest challenge. Quite simply, there just are not enough fully serviced, fully functional IVF that were [ph] developed in Africa and we believe this could be the great solution.

Pressly and I have had tremendous experience working with the team at G-Systems and Quality Medical during our years at Cooper Surgical. They are trusted by top medical device companies around the world and have a reputation for exceptional customer service.

But most importantly, both of these companies are specialized in the fertility sector. We then followed-up on the African agreements by signing additional agreements with our distribution teams in Turkey and Jordan.

These two are also excellent markets in need of lower-cost options for the fertility treatment. We expect all of these agreements to begin to contribute to our revenue streams in early 2020.

We are also systematically developing commercialization channel throughout the world with numerous potential opportunities focused on some of the biggest fertility markets in the world. We will keep you keep you posted on these additional opportunities as they become a reality.

Now let me turn it back over to Steve.

Thank you, Mike. As you can hear from Mike, we believe we are well on our way to fully commercialized INVOcell in other parts of the world.

We are being thoughtful until we partner with to ensure they will drive adoption of the INVOcell device. While 2019 was the year we took a huge first step in the U.S.

to our agreement with Ferring, 2020 will be the year we expect to significantly expand our present internationally. Let me quickly highlight the recent third quarter results.

Revenue increase to 143% to $303,000, on a sequential basis our product sales were lower than what we saw in the second quarter. It was the second quarter where Ferring placed their first order with us, which was larger in order for them to have sufficient initial stock.

Though it wasn't a big surprise to us; that was a little lower in Q3. Remember, it's still early in Ferring launch plan.

Also the required minimum purchases for next year will step up and we would expect additional contributions from international efforts next year as well. We incurred a net loss of $710,000 per quarter.

Our expenses did include added legal and other costs especially with pursuing some of the various international opportunities. We also had one time cost in the period of 180,000 associated with the settlement of a long-standing legal matter.

We are pleased to have that completely resolved and behind us now. We're not planning to provide specific guidance as it's too early.

We do believe, we will see strong increases in revenue as we move into next year with the combination of Feering's efforts along with our additional international activities. One additional item to note, we believe one of the options we have to build awareness of the company within the investment community is to eventually move our stock and trade on the OTC market place to list it in more visible exchange such the NASDAQ or NYSE market.

There is planning on logistics associated with any uplifting strategy. But it represents an opportunity to build the company's profile in front of a much larger audience of investors and receive better value for the progress being made.

I would not say this is our most important focus. Our intent is to move this to direction at the right time under the right circumstances that is within our control and we feel -- when we feel what further add to shareholder value for all.

With the recent high profile public offering at Progyny, a leading benefits management company specializing in fertility and family building benefits solutions which was led by JPMorgan, Goldman Sachs, and BofA Securities, we certainly feel the timing is right to be a public company in the fertility marketplace. But again, we are most focused on our commercialization efforts for the product and building the business.

In sum, I would like to thank all of the key participants that have helped develop the current foundation from which we are now poised to build upon. We feel we have an exciting technology and a large and even larger underserved market with the potential to solve some of the key industry challenges for creating greater access to care.

I want to thank all the shareholders for your ongoing support. Your investment has allowed us to reach this critical point in our business plan and we are committed to driving value in INVO Bioscience going forward.

Robert, I'll turn it back over to you to handle a couple of questions.

All right. Thanks so much, Steve and Mike for that overview.

You guys certainly addressed most of the questions that came in within your prepared statement there. But just a few others that hopefully you can expand upon here briefly.

The first one is, can you comment on some of the international commercialization effort in particular discussing China?

Sure. Well, first let me describe that, as it relates to our international activities, we really see potential structures in three main kind of categories.

One would be standard distributor type arrangements where they're relatively basic, short duration to be able to monitor distributor and how they perform. And these are the types of arrangements that we've initially entered into in some of the initial countries.

The next type of arrangement might be something a little more advanced by the Ferring like arrangement where it would come with upfront commitments, maybe higher annual revenue commitments and maybe a longer contract duration. We have some discussions occurring in that category as well.

And then lastly, potential joint venture type arrangements in certain countries. Here is where we would be working with a partner in a joint venture structure whereby would allow us an opportunity to maybe capture more than just simply device sales.

We wouldn't be trying to manage the joint venture in a foreign country that would -- we would like partner to do that. But there's an opportunity for us to have more participation in the building up a particular market.

And we have a few conversations in that category in select countries actively occurring as well. As far as the China market, this is a very interesting marketplace.

First, as some of you may or may not realize, is result of their one child policy over several decades. They've ended up with an upside down pyramid where the age and their population is no longer balanced, in other words, more older folks than younger folks.

They've also removed one child restriction and they are now the largest in fertility market in the world. Recent data suggest they are approaching 700,000 IVF cycles per year.

Demand is high and they too suffer from lack of capacity as they can take a year more for patient even get into an IVF clinic. So it’s a big and exciting market.

We would have clinical work to do in country and certainly we look to team up with a good partner in the country and we do have active discussions underway, but nothing more specific to report right now.

All right. Perfect.

Next question here, Steve, can you -- you talked about it briefly, but can you address the potential for the reversed docs [ph] split just further?

Sure. As many of you know, as part of a recent proxy filing we included a request to approve a potential split range for the board to determine if and when to implement at their discretion.

Let me first state, that in the event of a split everything outstanding and everything associated with the new equity incentive plan, which is also in the proxy will be split equally. So management and the board will be treated exactly the same as the shareholders.

We apologize for any confusion that some you had around that. I believe we clarify the language in the final proxy that went out.

I can also state, the request is designed to add value by improving the investment field to a broader range of investors. We fully recognize the reverse splits are perceived as negative.

But that is because companies often do them for the wrong reasons at the wrong time and they have a negative outcome. We plan to be careful and we do not need to be in a hurry here.

Our objective would be to evaluate doing this when we feel the right time and we'll add value to shareholders. Remember, we can we can also open up our story to a much broader set of investors if we eventually do list on exchange at some point.

All right. Thank you, Steve.

Next one here, talk a little bit or expand upon your budget plan for 2020?

Sure. It's clear we're running at a higher operating budget currently.

We see -- but we do see that this investment spending to help advance the business and put us in a position to generate much higher level of revenue. Of course, we have to make those expenditures in advance to receiving the benefits.

With that said we often do not envision needing to significant, we expand our headcount or fixed costs. We are small team and believe we can generally keep it that way.

We will likely look to make a few additions. Current thinking is maybe in the three to five number of people range as we move into next year to help support our activities, especially internationally.

But we also expect to see some of our variable cost like legal to come down a little. So our objective would be to keep our budget as close to where they are currently.

Then with revenues expect to expand nicely the next year we believe we can demonstrate a clear path to profitability.

All right. Perfect.

And we'll make this the last one here. Is there anything that is prohibiting Ferring from purchasing the company?

No. There is absolutely not.

As some of you may remember that in the Ferring agreement, they even have a right approach for refusal. So if we were approached by any other company, we would have to reflect that to Ferring.

Okay. Perfect.

Thank you, Steve, very much. I appreciate the time.

Mike, you saw of this well here. Steve, I'll turn it back over to you for any closing remarks you might have.

Thank you, Robert. We certainly appreciate everyone's time and interest in INVO Bioscience.

Should any of you have any follow-up questions, please feel free to reach out to us. We'll be happy to circle back to you.

Thank you.

All right. Thank you very much all for joining us today for the INVO Bioscience webcast.

Today's event will be available for replay shortly following the conclusion of this live event. Thank you all very much.

Have a great rest of your day.