Stock DZ
10.07.2018 kl 12:35
3249

Hi

One possible reason for this presentation is that it is aimed at a different audience from what is being discussed here.

It could be aimed at the partnering company shareholders. I believe the deal can come with 2 parts with the same actor (BP) equity investment + upfront payments (including milestones payments)

Please read through the following link from EY (Ernest Young) on how Biotech strategic alliances are formed.

link:

https://www.ey.com/Publication/vwLUAssets/EY-beyond-borders-2016-biotech-deals/%24FILE/EY-beyond-borders-2016-biotech-deals.pdf

Example:

"Although a significant percentage of total alliance value was tied up in earn-outs and royalty payments, biotech sellers in 2015 took in more than US$6 billion in total up-front payments, a record total. The ratio of up-front cash to total deal value reached 11%, ticking up slightly for the fourth consecutive year.

A closer analysis reveals a more nuanced picture.

Interestingly, those up-front payments included a record amount tied to equity stakes. In 2015, biotechs issued equity worth more than US$1.8 billion to strategic alliance partners, the most in any year since at least 2006. For buyers accessing biotech assets and technologies, buying equity — often at a massive premium — can be both P&L–sparing and a sign of long-term interest in the partnership.

Much of the alliance activity focused on technologies or products in the gene editing, gene therapy or immuno-oncology arenas. Vertex Pharmaceuticals’ October 2015 alliance with Swiss biotech CRISPR Therapeutics is the year’s most potentially lucrative. That deal, worth up to US$2.6 billion, included a US$30 million equity investment as well as an upfront cash payment of US$70 million. It aims to use CRISPR’s gene editing platform to correct mutations in the cystic fibrosis transmembrane conductance regulator (CFTR) gene. In December 2015, CRISPR, which also counts GlaxoSmithKline and Celgene among its investors, signed another strategic arrangement, forming a rare joint venture (JV) with Bayer’s new Bayer Lifescience Center unit. As part of the JV, the German pharma will invest US$335 million to advance therapies in blood disorders, blindness and cardiovascular disease.

Juno Therapeutics, meanwhile, received the year’s largest up-front alliance payment. Celgene paid US$1 billion, including US$850 million for a 10% equity stake in the biotech, to cement the broad chimeric antigen receptor-T-cell (CAR-T) deal, which gives the New Jersey-based biotech commercial options outside the US to Juno’s programs for 10 years. What’s more, Celgene secured rights — under certain conditions — to raise its stake in Juno to up to 30% over about a decade. The deal’s structure enables a symbiotic long-term alliance in the style of Roche-Genentech or Sanofi-Regeneron. It also makes Juno less vulnerable to the ups and downs of the capital markets

Good Luck
Arkivert