3i Group Plc · LSE:III
3i — 3i Bioscience Investment Trust — FY2002 Earnings Presentation
25 slides from 3i's earnings presentation, Dec 10, 2002
Slide 1: 3i Bioscience Investment Trust Annual Results to 30 September 2002
3i Bioscience Investment Trust Annual Results to 30 September 2002 10 December 2002 1
Slide 2: Market developments
3i Bioscience Investment Trust plc Annual results 2002 Market developments • Difficult 12 months for quoted equities • Clinical and regulatory setbacks emphasised in media, however, seven biotech new products approved • More companies profitable, including 17 portfolio companies • Multi-million doll
Slide 3: Fund developments
3i Bioscience Investment Trust plc Annual results 2002 Fund developments • Outperformed benchmark • New investment focused on later-stage quoted companies, particularly those in the US • New fund manager • Benchmark simplified Net asset value per share 249.7p Change in net asset value -36.5% Change
Slide 4: Difficult market conditions
3i Bioscience Investment Trust plc Annual results 2002 Difficult market conditions % UK stock market one year performance % US stock market one year performance 160 (rebased) 160 (rebased) 140 140 120 120 100 100 80 80 60 60 40 40 20 20 0 0 30/9/01 30/12/01 30/3/02 30/6/02 30/9/02 30/9/01 30/12/01 3
Slide 5: Biotech sector performance
3i Bioscience Investment Trust plc Annual results 2002 Biotech sector performance US & UK biotechnology indices and 3i Bioscience share price 1 October 2001 to date (rebased) 160 140 120 100 80 60 40 20 0 30/9/01 30/10/01 30/11/01 30/12/01 30/1/02 28/2/02 30/3/02 30/4/02 30/5/02 30/6/02 30/7/02 30/8
Slide 6: Portfolio analysis by asset class and geography
3i Bioscience Investment Trust plc Annual results 2002 Portfolio analysis by asset class and geography 28.6% Total portfolio Quoted portfolio 64.9% 1.2% 70.2% Unquoted portfolio 50.1% 35.1% 4.8% North America Unquoted Europe Quoted Rest of World 45.1% 6
Slide 7: Portfolio diversified by sub-sector
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Slide 8: Infectious diseases ($ millions)
3i Bioscience Investment Trust plc Annual results 2002 Infectious diseases 90 ($ millions) Inflammation 80 Lower cost to market 70 Neuropharmaceutical 60 Cardiovascular Faster time to market 50 Anti-infective Anti-infective 6 7 88 9 10 11 Development time (years) Higher likelihood of Neuropharmaceut
Slide 9: Quoted activity
3i Bioscience Investment Trust plc Annual results 2002 Quoted activity • Outperformed benchmark by 5.7% • Increased US investment from 61.8% to 70.2% • Focus on late-stage product companies • “Tail of portfolio” trimmed New quoted investments Genentech Four late stage products Amylin Two late stage
Slide 10: New investment – Amylin Pharmaceuticals
3i Bioscience Investment Trust plc Annual results 2002 New investment – Amylin Pharmaceuticals 3i Bioscience invested on strength of % Deal pipeline in late summer: 200 announced with Lilly 180 • two products in phase III for diabetes 160 Amylin share price Landmark deal signed with Lilly 20 Sep for
Slide 11: Existing investment – Gilead Sciences, Inc.
3i Bioscience Investment Trust plc Annual results 2002 Existing investment – Gilead Sciences, Inc. % Gilead share price A long standing anti-infective investment 110 (rebased) Two approvals this year 100 • Viread for HIV 90 • Hepsera for HBV 80 70 NASDAQ Biotech Index Continues to outperform index 6
Slide 12: Analysis of change in value of unquoted portfolio
3i Bioscience Investment Trust plc Annual results 2002 Analysis of change in value of unquoted portfolio £ millions 60 0.9 0.1 7.1 50 (15.5) (1.7) 40 30 49.0 20 39.9 10 0 Opening New Follow-ons Write-ups Write- Currency Closing value Sep invest- downs effect value Sep 2001 ments 2002 12
Slide 13: Outlook for unquoted portfolio
3i Bioscience Investment Trust plc Annual results 2002 Outlook for unquoted portfolio • Valued below cost • New investments in unquoted companies likely to be limited: - better value in quoted market for early stage companies - clear route to sustainability • Further investment in portfolio companie
Slide 14: Prospects for sector value growth
3i Bioscience Investment Trust plc Annual results 2002 Prospects for sector value growth • Burgeoning pipeline of late stage products - biotech drugs now account for 40% of all new drug approvals • Pharma pipeline gaps remain unfilled and patent expirations threaten sales growth • New FDA commission
Slide 15: Biotech companies have delivered to the market before…
3i Bioscience Investment Trust plc Annual results 2002 Biotech companies have delivered to the market before… Product Company Sales 2002E US$bn Epogen Amgen* 2.2 Neupogen Amgen* 1.8 Rituxan Genetech* / IDEC* 1.1 Avonex Biogen* 1.1 Enbrel Amgen* 0.8 PEG-Rebetron Enzon* (Schering-Plough) 0.7 Synagis M
Slide 16: …and are set to deliver again
3i Bioscience Investment Trust plc Annual results 2002 …and are set to deliver again 2006E Expected sales Product Company launch Indication US$m Hepsera Gilead Sciences* 2002 Hepatitis B Antiviral 250 Flumist Medimmune* 2003 Intranasal Flu Vaccine 300 Humira (D2E7) CAT* / Abbott 2003 Rheumatoid arth
Slide 17: Summary
3i Bioscience Investment Trust plc Annual results 2002 Summary • Difficult markets but NAV has outperformed benchmark over the period • Portfolio broadly diversified across geographies, sub-sectors and maturity • Biotechs account for an increasing proportion of marketed products • Sector valuations
Slide 18: Thank you
thank you For further information visit our website www.3i.com 18
Slide 19: Disclaimer
3i Bioscience Investment Trust plc Annual results 2002 Disclaimer This document contains details of the results of the 3i Bioscience Investment Trust (“3i Bioscience”) for the period ended 30 September 2002 and is a summary of an oral presentation (“Presentation”) of those results by executives of 3
Slide 20: Appendices
3i Bioscience Investment Trust plc Annual results 2002 Appendices 20
Slide 21: Top ten equity investments
3i Bioscience Investment Trust plc Annual results 2002 Top ten equity investments Gilead Sciences, Inc. (6.0%) Develops and commercialises proprietary therapeutics for infectious diseases and cancer. Amgen, Inc. (5.8%) Develops, manufactures and markets human therapeutics based on cellular and molec
Slide 22: Top ten equity investments
3i Bioscience Investment Trust plc Annual results 2002 Top ten equity investments Galen Holdings plc (3.2%) Develops manufactures and markets prescriptions in a range of key therapy areas with a focus on women’s healthcare, analgesics and cardiovascular. MitoKor (2.5%) Explores the therapeutic and d
Slide 23: About the Manager
3i Bioscience Investment Trust plc Annual results 2002 About the Manager 3i Group 3i Asset Management • Europe’s leading venture • The quoted fund management capital company arm of 3i Investments plc − FTSE 100 • Manages three specialist − Eurotop 300 investment trusts and 3i Group’s • Network of 36
Slide 24: 3i's healthcare team and global network
3i Bioscience Investment Trust plc Annual results 2002 3i’s healthcare team 3i’s global network • 25 Executives investing Boston • across Europe • • Menlo Park • • Centred in key hot spots • • • • • • • such as Cambridge and • • • • • • • • • • • Munich • • • Tokyo • • US private equity Hong Kong •
Slide 25: Non-executive Directors
3i Bioscience Investment Trust plc Annual results 2002 Non-executive Directors Douglas McDougall (Chairman) Chairman of the Law Debenture Corporation PLC, The Independent Investment Trust PLC and Foreign and Colonial Eurotrust PLC and a director of The Scottish Investment Trust plc. Robert Sinclair
3i Bioscience Investment Trust — FY2002 Earnings Presentation on 6ix