BioPharma Credit PLC USD · LSE:BPCP
BioPharma Credit PLC USD — BioPharma Credit — Investor Presentation (February 2020)
24 slides from BioPharma Credit PLC USD's investor presentation, February 2020
Slide 1: Debt Capital for the Life Sciences Industry
Debt Capital for the Life Sciences Industry COMPANY PRESENTATION – February 2020 For additional information please email: [email protected] or visit BioPharma Credit’s website at www.bpcruk.com
Slide 2: Disclaimer
Disclaimer . THIS PRESENTATION IS BEING PROVIDED TO YOU SOLELY FOR YOUR INFORMATION. THIS PRESENTATION IS NOT FOR PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, INTO OR WITHIN THE UNITED STATES, CANADA, AUSTRALIA, JAPAN OR THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDIC
Slide 3: Disclaimer
Disclaimer This presentation was prepared using the financial information available to the Company as at the date of this presentation. Except where otherwise indicated herein, the information provided in this presentation is based on matters as they exist as of the date of preparation and not as of
Slide 4: Experienced Management Team
Experienced Management Team Pharmakon Advisors Pedro Gonzalez de Cosio Martin Friedman Pablo Legorreta Co-Founder, Principal and CEO Principal Co-Founder and Principal Co-founded Pharmakon in 2009 Joined Pharmakon in 2011 Co-Founded Pharmakon in 2009 after 17 years in structured after 18 years
Slide 5: Investment Opportunity – Summary
Investment Opportunity – Summary The Life Sciences Debt Market is an Underserved, Large and Growing Opportunity Worldwide $1.1tn industry growing at 6% per annum Large capital needs; global R&D expenditure by pharmaceutical and biotech companies reached $179 billion in 2018, 40% more than in 201
Slide 6: Life Sciences is a Large, Vital Industry with Uncorrelated Sales
Life Sciences is a Large, Vital Industry with Sales that are Uncorrelated and Unaffected by Economic Cycles Global Pharmaceutical Sales: Historical & Projected ($, Trn) Annual Changes in Sales of Oncology Drugs vs Major Indices 100% $140 Oncology Sales $Bn Oncology Sales (% change) Barclays US HY In
Slide 7: Specialization & Fragmentation of Drug Discovery Leading to More Lending Opportunities
Specialization & Fragmentation of Drug Discovery is Leading to More Lending Opportunities Basic Research / Applied Research / Commercialization Pre-Clinical Human Clinical Trials Old Model Big Pharma New Model Big Pharma Biotech / Specialty Pharma (Target Borrowers for BPC funds) Governments and Aca
Slide 8: The majority of new drugs approved originated at smaller biopharma companies
The majority of new drugs approved originated at, or were initially developed by, smaller biopharma companies 7 Source: Pharmakon Advisors
Slide 9: Major milestones since IPO
Major milestones since IPO1 IPO – $762m gross Placing of Ordinary Issue of C-Shares Placing of Ordinary proceeds including Shares – $154m – $163m gross Shares – $305m $339m of seed assets gross proceeds proceeds gross proceeds March Q2-2017 Q3-2017 Q4-2017 Q1-2018 Q2-2018 Q3-2018 Q4-2018 Q2-2019 Q3-
Slide 10: Portfolio and dividends since IPO
Portfolio and dividends since IPO2 Evolution of the BioPharma Credit portfolio (millions) BPCR Portfolio Composition ($m) $1,600 GBT Sarepta • Twelve loans currently in the portfolio $1,400 $41 Akebia after three years / Bio-Pharma IV peaked $150 $175 Epizyme at seven $1,200 $64 $44 Optinose $40 • L
Slide 11: Summary of past transactions
Summary of past transactions 10
Slide 12: Funds managed by Pharmakon have committed over $4.6bn across 40 transactions
Funds managed by Pharmakon Advisors have committed over $4.6bn across 40 transactions Historical Investment Performance as of December 2019 (Private Funds) Private Fund I II III IV V Founded in 2009; manager of the BioPharma Credit funds Launch Date June 2009 March 2011 February 2013 December 2015
Slide 13: Appendix
Appendix 12
Slide 14: $200m senior secured corporate loan
$200m senior secured corporate loan Collegium Pharmaceutical: biopharmaceutical company focused on developing and commercializing new medicines for responsible pain management. Market Cap: $680m as of 2/07/20 Cash: $154m as of 9/30/19 Main Products: Xtampza® ER, an abuse-deterrent, extended-
Slide 15: $150m senior secured corporate loan
$150m senior secured corporate loan Global Blood Therapeutics: biopharmaceutical company focused on developing and marketing therapies for sickle cell disease. Market Cap: $4,787.8m as of 12/31/19 Cash: $683m as of 9/30/19 Main Product: Oxbryta (voxeletor) approved in November 2019 as an ora
Slide 16: $500m senior secured corporate loan
$500m senior secured corporate loan Sarepta Therapeutics: Biopharmaceutical company focused on therapies for neuromuscular diseases. Market Cap: $9,619.0m as of 12/31/19 Cash: $1,048.9 as of 9/30/19 Main products: EXONDYS 51 (eterplirsen) approved September 2016 for the treatment of Duchenne
Slide 17: $100m senior secured corporate loan
$100m senior secured corporate loan Akebia Therapeutics is a biopharmaceutical company focused on the development and commercialization of therapeutic for patients with kidney disease. Market Cap: $751.7m as of 12/31/19 Cash: $145.6m as of 9/30/19 Main product: Auryxia® approved on September
Slide 18: $70m senior secured corporate loan
$70m senior secured corporate loan Epizyme: Biopharmaceutical company focused on cancer and other diseases through novel epigenetic medicines. Market Cap: $2,240.4m as of 12/31/19 Cash: $292.9m as of 9/30/19 Main Product: Tazemetostat – an oral, first-in-class, selective small molecule drug
Slide 19: $150m senior secured corporate loan
$150m senior secured corporate loan Optinose: Specialty pharmaceutical company focused on products for patients treated by ear, nose, and throat (ENT) and allergy specialists. Market Cap: $422.7m as of 12/31/19 Cash: $125.5m as of 9/30/19 Main product: XHANCE® – fluticasone propionate nasal
Slide 20: The right structure / LTV helps generate attractive returns on debt
The right structure / LTV helps generate attractive returns on debt irrespective of equity performance1 Life Sciences Debt Investments are less risky and are exposed to less volatility than the corresponding equity investments ■ The chart below shows the cash on cash returns of all past Pharmakon in
Slide 21: Rigorous screening and evaluation of opportunities
Rigorous screening and evaluation of opportunities 2018 Pharmakon Opportunities Filters Screened 195 opportunities. Initial screen focused on: 1 Viable, marketed product 195 Opportunities Counterparty with financing need 2 64 opportunities met initial requirements. Performed initial 64 diligence
Slide 22: Risk Mitigants
Pharma products generate predictable, patent protected cash flows and provide strong collateral across the many stages of product life Top 500 Drugs Based on WW Sales Since 1986 – Average Annual WW Sales Since Year Of Launch $1,422 $1,438 Loss of IP Drug Regulatory $1,384 Exclusivity $1,342 $1,375 A
Slide 23: M&A take-out value of oncology and specialty product companies
M&A take-out value of oncology and specialty product companies illustrate the potential collateral value of these products Best-in-class specialty therapeutic companies are purchased for as much as 5 to 7 times peak sales * Normalized for 100% ownership Source: Bloomberg, company filings 22
Slide 24: M&A take-out value of oncology and specialty product companies
M&A take-out value of oncology and specialty product companies illustrate the potential collateral value of these products Best-in-class specialty therapeutic companies are purchased for as much as 5 to 7 times peak sales * Normalized for 100% ownership Source: Bloomberg, company filings 23
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