TIDMBPCR
RNS Number : 8101N
BioPharma Credit PLC
27 September 2023
27 September 2023
BIOPHARMA CREDIT PLC
(THE "COMPANY")
HALF YEAR REPORT FOR THE PERIODED 30 JUNE 2023
FLOATING RATES RISE TO 98% OF LOAN PORTFOLIO; INVESTMENT RETURNS
INCREASE
BioPharma Credit PLC (LSE: BPCR), the specialist life sciences
debt investor, is pleased to present the Half Yearly Report of the
Company for the period ended 30 June 2023.
The full Half-Yearly Report and Financial Statements can be
accessed via the Company's website at www.bpcruk.com or by
contacting the Company Secretary by telephone on +44 (0) 333 300
1950
.
INVESTMENT HIGHLIGHTS
-- Over the first six months of 2023, the Company and its
subsidiaries invested $195 million comprising three investments,
further increasing portfolio diversification:
o $37.5 million for the loan to ImmunoGen announced on 11 April
2023
o $120 million for the loan to BioCryst announced on 19 April
2023
o $37.5 million for the loan to Reata announced on 11 May
2023
-- The Company also received increased liquidity from
amortisation payments from the Akebia and Collegium loans and the
BMS purchased payments
-- Post period-end deployment of an additional $41 million
further reduced the effect of cash drag
-- At period end the Company had $154 million in cash and $67
million available to draw under its credit facility
-- LumiraDx one of the Company's investees, is currently considering strategic alternatives
o The Company's investment manager is actively engaged with the
board of directors and management of LumiraDx and looks forward to
updating investors on developments as they occur
-- On 26 September 2023, Biogen closed on its acquisition of
Reata and Reata paid $62.5 million to the Company and the Company
also received $15.6 million in prepayment and make whole fees
-- The Company's investment manager continues to develop a
pipeline of additional potential investments to further diversify
the portfolio
FINANCIAL HIGHLIGHTS
-- The percentage of floating rate senior secured loans within
the portfolio further increased to 98% from 81%, having a
significant positive impact on the Company's earnings as well as
offering protection in a rising rate environment
-- Investment returns increased to $79 million during the first
six months of 2023 compared with $76 million during the same period
in 2022
-- The Company made two dividend payments over the period
totalling $0.0508 per share, referencing net income for the
quarters ending 31 December 2022 and 31 March 2023
o The Company is currently paying and continues to target a
7-cent annual dividend per share
SUMMARY
as at 30 June 2023
Share Price Net Assets
$0.8960 $1,327.9m
(31 December 2022: $0.9500) (31 December 2022: $1,337.5m)
NAV per Share Shares in issue
$1.0178 1,373.9m
(31 December 2022: $1.0139) (31 December 2022: 1,373.9m)
Discount to NAV per Share Leverage
12.0% 0%
(31 December 2022: 6.3%) (31 December 2022: 0%)
Net income per share Target Dividend
$0.0538 7 cents per annum
(30 June 2022: $0.0445) (31 December 2022: 7 cents per annum)
PORTFOLIO COMPOSITION
As at 30 As at 31 As at 30 As at 31
June 2023 December June 2023 December
($m) 2022 ($m) (%) 2022 (%)
Collegium senior secured loan 252.1 287.5 19.0% 21.6%
Cash and cash equivalents 154.2 333.0 11.6% 25.0%
LumiraDx senior secured loan and
warrants 150.5 150.1 11.3% 11.3%
Insmed senior secured loan 146.1 140 11.0% 10.5%
Coherus senior secured loan 125.0 125 9.4% 9.4%
BioCryst senior secured loan 121.5 - 9.1% 0.0%
BMS purchased payments 89.7 103.5 6.8% 8.0%
Optinose senior secured note, shares
and warrants 71.9 72.5 5.4% 5.4%
Evolus senior secured loan 50.0 37.5 3.8% 2.8%
Urogen senior secured loan 50.0 50 3.8% 3.8%
Reata senior secured loan 37.5 - 2.8% 0.0%
ImmunoGen senior secured loan 37.5 - 2.8% 0.0%
Immunocore senior secured loan 25.0 33.5 1.9% 1.9%
Akebia senior secured loan 21.5 25 1.6% 2.5%
Other net liabilities -4.6 -20.1 -0.3% -2.3%
-------------------------------------- ----------- ------------------------------- ----------- ----------
Total net assets 1,327.9 1,337.5 100% 100%
-------------------------------------- ----------- ------------------------------- ----------- ----------
* Cash and cash equivalents include balances at the Company and
BPCR Limited Partnership.
Pedro Gonzalez de Cosio, CEO and co-founder of Pharmakon
Advisors, LP, the Investment Manager of BioPharma Credit PLC,
said:
"We are pleased with another highly active period for the
Company and its portfolio with a further $195 million deployed in
three new investments during the six months under review.
"Further, we are encouraged to see the Company's earnings
profile continue to rise in line with both strong investment
activity and the very high allocation of the Company's loan
portfolio to floating rate investments, currently 98%. In addition,
the announcement from Biogen to acquire Reata resulted in a highly
attractive IRR for the Company's initial investment that will
enhance the available capital for distribution in the second half
of the year. While LumiraDx has faced liquidity issues, the Company
is currently considering strategic alternatives and we look forward
to providing investors with updates as they occur.
"We expect our investment pipeline to grow as new products enter
the market during the second half of 2023 and we are continuing to
develop an attractive pipeline to further diversify our portfolio.
We remain focused on our mission of creating the premier dedicated
provider of debt capital to the life sciences industry while
generating attractive returns and sustainable income to investors
and remain confident of our ability to deliver the Company's
dividend target to investors."
Results presentation
As announced on 31 August 2023, a management presentation for
sell side analysts will be held via a webcast call facility at 2pm
BST today. To request details or to register to attend please RSVP
biopharmacredit@buchanan.uk.com .
Enquiries
Buchanan
David Rydell / Mark Court / Jamie Hooper / Henry Wilson
+44 (0) 20 7466 5000
biopharmacredit@buchanan.uk.com
Notes to Editors
BioPharma Credit PLC is London's only specialist debt investor
in the life sciences industry and joined the LSE in March 2017. The
Company seeks to provide long-term shareholder returns, principally
in the form of sustainable income distributions from exposure to
the life sciences industry. The Company seeks to achieve this
objective primarily through investments in debt assets secured by
royalties or other cash flows derived from the sales of approved
life sciences products.
CHAIRMAN'S STATEMENT
DURING THE FIRST HALF OF 2023, THE COMPANY ANNOUNCED THREE NEW
TRANSACTIONS TOTALING $380 MILLION IN FRESH COMMITMENTS
INTRODUCTION
I am pleased to present the half yearly report for the Company,
which covers the period 1 January 2023 to 30 June 2023. The Company
continues to offer investors exposure to an attractive and
diversified
portfolio of secured loans. Consistent with challenges seen
across the market, the Company's shares have traded at a discount
to NAV through the period. The Company has therefore continued the
buyback programme to demonstrate support for the NAV and provide
confidence to the market. The Company will continue to execute buy
backs at appropriate prices subject to closed periods.
INVESTMENTS
Over the first six months of 2023, the Company and its
subsidiaries invested $195 million, comprised of $37.5 million for
the ImmunoGen loan, $120 million for the BioCryst loan and $37.5
million for the Reata loan. The portfolio diversification increased
during 2022 and into 2023.
The Company, including assets and liabilities from its financing
subsidiary, BPCR Limited Partnership, ended the period with total
net assets of $1,328 million, comprising $1,178 million of
investments, $154 million of cash and $4 million of other net
liabilities. The Company and its subsidiaries saw $65 million
increased liquidity from the amortisation payments of the Akebia
and Collegium loans and the BMS purchased payments. The post
balance sheet deployment of $41 million has further reduced any
negative impact of cash drag.
As further described in Pharmakon Advisors, LP's ("Pharmakon" or
the "Investment Manager") section of this report, the loans in the
portfolio remain current. LumiraDx, one of the Company's borrowers
has been facing liquidity issues and is currently considering
strategic alternatives. The Investment Manager is actively engaged
with the board of directors and management of LumiraDx and will
continue to update investors on developments as they occur.
SHAREHOLDER RETURNS
The Company reported net income on ordinary activities after
finance costs and before taxation for the first half of 2023 of $71
million, up from the $68 million reported during the first half of
2022. On 30 June
2023, the Company's Ordinary Shares closed at $0.8960, below the
closing price on 31 December 2022 of $0.9500. Net Asset Value
("NAV") per Ordinary Share increased over the same timeframe by
$0.0039 from $1.0139 to $1.0178.
The Company made two dividend payments over the period totaling
$0.0508 per share, referencing net income for the quarters ending
31 December 2022 and 31 March 2023. The Company is currently paying
and continues to target a 7 cent annual dividend per share.
INVESTMENT VALUATIONS
The valuation of the Company's investments is performed by the
Investment Manager. Investments with quoted prices in active
markets or external market data are verified with independent
sources. The valuation principles of the Company's unlisted secured
loans are valued based on a discounted cash flow methodology. A
fair value for each loan is calculated by applying a discount rate
to the cash flows expected to arise from each loan. Further details
on the valuation methodology are given in note 7 to the financial
statements.
ESG
The Board has supported the Investment Manager's Environmental,
Social and Governance ("ESG") programme over the first six months
of 2023, with progress made in embedding ESG as an integral part of
the investment process. The key areas are described in more detail
on page 16 of the full Half-yearly Report.
OUTLOOK
The Company started 2023 strongly having announced three
transactions that represent $380 in commitments. 98 per cent. of
the Company's investment loan balance consists of floating interest
rates
enabling the Company's strategy to remain attractive in the new
interest rate environment. The Company had $154 million in cash and
$67 million available to draw under its credit facility with
JPMorgan Chase Bank to make new investments at 30 June 2023. The
Investment Manager continues to develop a pipeline of additional
potential investments and, as a consequence, we are currently
evaluating a number of potential alternatives to fund future growth
and further diversify our portfolio. On behalf of the Board, I
should like to express our thanks to Pharmakon for their continued
achievements on behalf of the Company in 2023 and to our
shareholders for their continued support.
Harry Hyman
Chairman
26 September 2023
INVESTMENT MANAGER'S REPORT
Pharmakon is pleased to present an update on the Company's
portfolio and investment outlook. Pharmakon's engagement with
potential counterparties during the first six months of the year
resulted in $380 million of new transactions for the Company. The
majority of the Company's portfolio continues to perform well.
LumiraDx, one of the Company's borrowers, has been facing liquidity
issues and is currently considering strategic alternatives. The
Investment Manager is actively engaged with the board of directors
and management of LumiraDx and will continue to update investors on
developments as they occur.
The proportion of floating rate loans in the portfolio, together
with an increase in the interest free rate, leads to investment
returns increasing by 4 per cent. During the first six months of
2023 compared to the same period in 2022. There were no prepayments
during the period.
Below is an update on the Company and its subsidiaries
portfolio.
Reata
On 5 May 2023, the Company and a Private Fund also managed by
the Investment Manager (the "Private Fund"), entered into a
definitive senior secured term loan agreement for up to $275
million with Reata Pharmaceuticals Inc. ("Reata") maturing in May
2028. Tranche A of $75 million was funded at closing. Tranche B of
$50 million and Tranche C of $75 million will be drawn after
achieving certain performance-based milestones, and Tranche D of
$75 million will be available at the Company's discretion after
achieving certain sales-based milestones. The loan has a coupon of
3-month secured overnight financing rate ("SOFR"), plus 7.5 per
cent. (subject to a 2.5 per cent. floor).
There is also a 2.0 per cent. upfront fee upon each draw. The
interest only period for the loan is for 3 years but can be
extended to 4 years if trailing twelve month sales are greater than
$250 million. The Company's share of the transaction is $137.5
million, of which $37.5 million was funded at closing. Reata is a
biopharmaceutical company focused on identifying, developing, and
commercializing small-molecule therapeutics with novel mechanisms
of action for the treatment of severe, life-threatening diseases
with few or no approved therapies. Their lead program is
omaveloxolone in a rare neurological disease called Friedreich's
Ataxia (FA) which activates the transcription factor Nrf2 to
normalize mitochondrial function, restore redox balance, and
resolve inflammation. Reata's key product Skyclarys was approved in
the US on 28 February 2023, and is indicated for the treatment of
Freidreich's Ataxia in adults and adolescents 16 years and older.
On 10 July 2023, the Company funded Tranche B of the Reata loan for
$25,000,000.
On 28 July 2023, Inc. ("Biogen") Biogen announced a definitive
agreement pursuant to which Biogen will acquire Reata for an
enterprise value of approximately $7.3 billion. Biogen and Reata
currently anticipate that the Transaction will close in the fourth
quarter of 2023. If the Transaction were to close on 29 September
2023, the Company would be expected to receive approximately $15.5
million in prepayment and make-whole fees.
Investment type Initial investment date
Secured loan 12 May 2023
Total loan amount Company commitment
$275m $138m
Maturity
May 2028
BioCryst
On 17 April 2023, the Company along with the Private Fund
entered into a definitive senior secured term loan agreement for up
to $450 million with BioCryst Pharmaceuticals Inc. ("BioCryst")
maturing in April 2028. Tranche A of $300 million was drawn at
closing. The remaining three tranches of up to $50 million each
will be available through 30 September 2024. The loan has a coupon
of 3-month SOFR plus 7.0 per cent. (subject to a 1.75 per cent.
floor) and up to 50 per cent. of the interest during the first 18
months may be paid-in-kind (PIK) at a rate of 3-month SOFR plus
7.25 per cent. There is also a 1.75 per cent. upfront fee on the
loan.
The Company's share of the transaction is $180 million, of which
$120 million was funded at closing. BioCryst has elected the option
to accrue 50 per cent. of their interest due from closing through
30 June
2023 as a payment-in-kind as allowed in the loan agreement.
BioCryst is a global biopharmaceutical company that discovers and
commercializes novel, oral, small- molecule medicines. BioCryst's
commercial product, Orladeyo, is indicated for prophylaxis to
prevent attacks of hereditary angioedema (HAE) in adults and
pediatric patients 12 years and older. BioCryst also has one
pipeline product for BCX10013, a factor D inhibitor being studied
in atypical hemolytic uremic syndrome (aHUS), IgA nephropathy
(IgAN), and complement 3 glomerulopathy(C3G). BioCryst's key
product Orladeyo was
approved in the US on 3 December 2020, and is indicated for
prophylaxis to prevent attacks of hereditary angioedema (HAE) in
adults and pediatric patients 12 years and older. The product was
subsequently approved in Japan on 22 January 2021, and the European
Union on 30 April 2021.
Investment type Investment date
Secured loan 17 April 2023
Total loan amount Company commitment
$450m $180m
Maturity
April 2028
ImmunoGen
On 6 April 2023, the Company along with the Private Fund entered
into a definitive senior secured loan agreement with ImmunoGen,
Inc. ("ImmunoGen") for up to $125 million. The loan will mature in
April 2028 and bears interest at SOFR plus 8.0 per cent. (subject
to a 2.75 per cent. floor), with an additional consideration of 2.0
per cent. of the total loan amount.
The Company committed to invest up to $62.5 million (Tranche A -
$37.5 million; Tranche B - $25.0 million by 31 March 2024) and
funded its allocation of Tranche A of $37.5 million on 6 April
2023. ImmunoGen is a commercial-stage biotechnology company focused
on developing and commercializing the next generation of
antibody-drug conjugates (ADCs) to improve outcomes for cancer
patients. ImmunoGen's commercial product, Elahere, is indicated for
the treatment of FRa positive, platinum-resistant ovarian cancer
and is currently being commercialized in the US. ImmunoGen is also
developing pivekimab sunirine for the treatment of blastic
plasmacytoid dendritic cell neoplasm (BPDCN) and acute myeloid
leukemia (AML).
Investment type Initial investment date
Secured loan 6 April 2023
Total loan amount Company commitment
$125m $63m
Maturity
April 2028
Immunocore
On 8 November 2022, the Company along with the Private Fund
entered into a definitive senior secured loan agreement for up to
$100 million with Immunocore Limited (Nasdaq: IMCR), a
biopharmaceutical company focused on developing a novel class of
TCR bispecific immunotherapies designed to treat a broad range of
diseases, including cancer, infectious and autoimmune diseases
("Immunocore").
The Company and its subsidiaries funded $25 million of the first
tranche of $50 million on 8 November 2022. The remaining $50
million may be drawn by 30 June 2024. The Company's share of the
final tranche is $25 million. Tranche A will mature in November
2028 and bears interest at 9.75 per cent. per annum along with an
additional consideration of 2.50 per cent. paid at funding.
Tranche B if drawn, will mature in November 2028 and will bear
interest at 3-month SOFR plus 8.75 per cent. per annum subject to a
1.00 per cent. floor along with an additional consideration of 2.50
per cent.
Investment type Investment date
Secured loan 8 November 2022
Total loan amount Company commitment
$100m $50m
Maturity
November 2028
Insmed
On 19 October 2022, the Company and the Private Fund entered
into a definitive senior secured loan agreement for $350 million
with Insmed Incorporated (Nasdaq: INSM), a biopharmaceutical
company focused on treating patients with serious and rare
diseases ("Insmed").
The Company and its subsidiaries funded $140 million of the $350
million loan on 19 October 2022. Insmed has elected the option to
accrue 50 per cent. of their interest due from closing through 30
June 2023 as a payment-in-kind as allowed in the loan agreement.
The loan will mature in October 2027 and bears interest at a rate
based upon the 3-month SOFR, plus 7.75 per cent. per annum subject
to a SOFR floor of 2.50 per cent. with a one-time additional
consideration of 2.00 per cent. of the total loan amount paid at
funding.
Investment type Investment date
Secured loan 19 October 2022
Total loan amount Company commitment
$350m $140m
Maturity
October 2027
Collegium 2022
On 14 February 2022, the Company along with the Private Fund
provided Collegium Pharmaceuticals, Inc. (Nasdaq: COLL), a
biopharmaceutical company focused on developing and commercialising
new medicines for responsible pain management ("Collegium"), with a
commitment to enter into a new senior secured term loan agreement
for $650 million. On 22 March 2022, proceeds from the new loan were
used to fund Collegium's acquisition of BDSI as
well as repay the outstanding debt of Collegium and BDSI. At
closing, the Company and its subsidiaries invested $325 million in
a single drawing.
The four-year loan will have $100 million in amortisation
payments during the first year and the remaining $550 million
balance will amortize in equal quarterly installments. The loan
will mature in March 2026 and bears interest at 3-month LIBOR plus
7.50 per cent. per annum subject to a 1.20 per cent. floor along
with a one-time additional consideration of 2.00 per cent. of the
loan amount paid upon signing and a one-time additional
consideration of 1.00 per cent. of the loan amount paid at funding.
On 23 June 2023, the Company and the Private Fund entered into an
amendment which modified the loan interest rate to 3-month SOFR
plus 7.50 per cent. Collegium currently markets Xtampza ER, an
abuse-deterrent, extended-release, oral formulation of oxycodone
and Nucynta(tapentadol), a centrally acting synthetic
analgesic.
Investment type Investment date
Secured loan 22 March 2022
Total loan amount Company commitment
$650m $325m
Maturity
March 2026
UroGen
On 7 March 2022, the Company and the Private Fund entered into a
definitive senior secured loan agreement for up to $100 million
with UroGen Pharma, Inc. (Nasdaq: URGN), a biopharmaceutical
company dedicated to creating novel solutions that treat urothelial
and specialty cancers ("UroGen"). UroGen drew down $75 million at
closing and the remaining $25
million on 16 December 2022.
The Company and its subsidiaries funded $50 million across the
two tranches. The loan will mature in March 2027 and bears interest
at 3-month LIBOR plus 8.25 per cent. per annum subject to a 1.25
per cent. floor along with a one-time additional consideration of
1.75 per cent. of the total loan amount paid at funding of the
first tranche. On 29 June 2023, the Company and the Private Fund
entered into an amendment which modified the loan interest rate to
3-month SOFR plus 8.25 per cent. UroGen markets JELMYTO
(mitomycin), a prescription medicine used to treat adults with a
type of cancer of the lining of the upper urinary tract including
the kidney called low- grade Upper Tract Urothelial Cancer (LG-
UTUC).
Investment type Initial investment date
Secured loan 16 March 2022
Total loan amount Company commitment
$100m $50m
Maturity
March 2027
Coherus
On 5 January 2022, the Company and the Private Fund entered into
a definitive senior secured loan agreement for up to $300 million
with Coherus BioSciences, Inc. (Nasdaq: CHRS), a biopharmaceutical
company building a leading immunooncology franchise funded with
cash generated by its commercial biosimilars business ("Coherus").
Coherus drew down $100 million at closing, another $100 million on
31 March 2022, and an additional $50 million on 14 September 2022.
The remaining $50 million commitment lapsed so there are no
additional funding commitments.
The Company and its subsidiaries funded $125 million across the
first three tranches. The loan will mature in January 2027 and
bears interest at 3-month LIBOR plus 8.25 per cent. per annum
subject to a 1.00 per cent. floor along with a one-time additional
consideration of 2.00 per cent. of the total
loan amount paid at funding of the first tranche. On 6 February
2023, the Coherus loan was amended to allow for a short term waiver
to the sales covenant, as well switching the LIBOR component of the
loan coupon to SOFR. Coherus markets UDENYCA(R)
(pegfilgrastimcbqv), a biosimilar of Neulasta
in the United States, and expects to launch the FDA-approved
Humira biosimilar YUSIMRY (adalimumab-aqvh) in the United States in
2023.
Investment type Initial investment date
Secured loan 5 January 2022
Total loan amount Company commitment
$250m $125m
Maturity
January 2027
Evolus
On 14 December 2021, the Company and the Private Fund entered
into a definitive senior secured loan agreement for up to $125
million with Evolus, Inc. (Nasdaq: EOLS), a biopharmaceutical
company that develops, produces, and markets clinical neurotoxins
for aesthetic treatments ("Evolus"). The Company and its
subsidiaries funded $37.5 million of the first tranche of $75
million on 29 December 2021. The remaining $50 million may be drawn
by 31 December 2023.
The Company's share of the final tranche is $25 million. The
loan will mature in December 2027 and bears interest at 3-month
LIBOR plus 8.50 per cent. per annum subject to a 1.00 per cent.
floor along with a one-time additional consideration of 2.25 per
cent. of the total loan amount paid at funding of the first
tranche. On 5 December 2022, the Evolus loan was amended to extend
the draw down date for Tranche B in exchange for a $500,000
amendment fee, of which 50 per cent. was allocated to the Company.
On 9 May 2023, the Company and the Private Fund entered into an
amendment which modified the loan interest rate to 3-month SOFR
plus 8.50 per cent and the Tranche B closing. The Company completed
the funding of $12.5 million to Evolus on 31 May 2023. Evolus will
borrow the remaining fifty percent of Tranche B on 15 December
2023. Evolus currently markets Jeuveau (prabotulinumtoxinA-xvfs),
the first and only neurotoxin dedicated exclusively to
aesthetics.
Investment type Initial investment date
Secured loan 14 December 2021
Total loan amount Company commitment
$125m $63m
Maturity
December 2027
LumiraDx
On 23 March 2021, the Company and the Private Fund entered into
a definitive senior secured loan agreement for $300 million with
LumiraDx Investment Limited and LumiraDx Group Limited
(collectively "LumiraDx"). The Company and its subsidiaries funded
$150 million of the $300 million loan on 29 March 2021. The loan is
due to mature in March 2024 and bears interest at 8.00 per cent.
per annum along with an additional consideration of 2.50 per cent.
of the loan amount paid at funding and an additional 1.50 per cent.
of the loan payable at maturity. On 28 September 2021, LumiraDx
became public via a SPAC transaction with CA Healthcare Acquisition
Corp. and began trading on NASDAQ under the ticker LMDX.
The Company and the Private Fund both received 742,924 warrants
exercisable into common stock of LumiraDx under the terms of the
transaction. On 28 March 2022, the LumiraDx loan was amended to
allow LumiraDx to enter into a royalty agreement with certain
investors to raise up to an aggregate amount of $50 million. On 17
June 2022, the LumiraDx loan was amended to provide LumiraDx with
certain waivers in exchange for increasing the fee payable at
maturity from 1.50 to 3.00 per cent. of the loan. On 25 July 2022,
LumiraDx raised $100 million in a follow-on offering at a price of
$1.75. As part of the financing, Pharmakon re-tiered its sales
covenants, received a facility fee, and was issued new five-year
warrants with the original warrants being cancelled. On 22 February
2023, the LumiraDx loan was amended to provide LumiraDx with
certain waivers in exchange for increasing the fee payable at
maturity from 3.00 to 9.00 per cent. of the loan. On 1 March 2023,
the LumiraDx loan was amended to allow for conforming updates to
the loan agreement. On 7 June 2023, the LumiraDx loan was amended
to provide for, among other things, revisions to the minimum net
sales and the minimum liquidity covenants in the loan agreement. In
exchange LumiraDx has agreed to, among other things, pay additional
payment-in-kind interest with respect to amounts outstanding under
the Loan Agreement in an amount equal to three month term SOFR. On
30 June 2023, the LumiraDx loan was amended to extend the time that
LumiraDx has to comply with certain minimum net sales and minimum
liquidity covenants in the Loan Agreement until 17 July 2023.
LumiraDx is a UK based,
next-generation Point of Care ("POC"), diagnostic company
addressing the current limitations of legacy POC systems by
bringing performance comparable to a central lab to the POC in
minutes, on a single instrument for a broad menu of tests with a
low cost of ownership. To date, LumiraDx has developed and launched
twelve diagnostic tests for use with its platform, three of which
have been approved in the United States under an Emergency Use
Authorization and in the European Union under a Conformite
Europeenne mark: a SARS-CoV-2 ("COVID-19") antigen test, a COVID-19
antibody test, and a COVID-19 surveillance test. The nine other
tests are currently approved only in the European Union under a
Conformite Europeenne mark. LumiraDx has also used its technology
to develop two rapid COVID-19 reagent testing kits for use on open
molecular systems, LumiraDx SARS-CoV-2 RNA STAR and SARS-CoV-2 RNA
STAR Complete, both of which obtained Emergency Use Authorization
by the FDA.
Investment type Investment date
Secured loan 23 March 2021
Total loan amount Company commitment
$300m $150m
Maturity
March 2024
Akebia
On 11 November 2019, the Company and the Private Fund entered
into a definitive senior secured term loan agreement for up to $100
million with Akebia Therapeutics, Inc. (Nasdaq: AKBA), a fully
integrated biopharmaceutical company focused on the development and
commercialisation of therapeutics for people living with kidney
disease ("Akebia"). Akebia drew down $80 million at closing and an
additional $20 million on 10 December 2020.
The Company and its subsidiaries funded $50 million across both
tranches. The loan will mature in November 2024 and bears interest
at LIBOR plus 7.5 per cent. per annum along with a one-time
additional consideration of 2 per cent. of the total loan amount
paid at funding. The Akebia loan began amortising in September
2022. On 18 February 2022, the Akebia loan was amended to provide
Akebia certain waivers. On 15 July 2022, the Akebia loan was
amended to provide Akebia with certain waivers. As a result of this
amendment on 15 July 2022, Akebia made a $25 million pre-payment,
of which $12.5 million went to the Company, as well as a 2 per
cent. prepayment fee. On 30 June 2023, the Company and the Private
Fund entered into an amendment which modified the loan interest
rate to 3-month SOFR plus 7.50 per cent. The Company's outstanding
balance as of 30 June 2023 is $21.5 million. Akebia currently
markets Auryxia(R) (ferric citrate) which is approved in the US for
hyperphosphatemia (elevated phosphorus levels in blood serum) in
adult patients with chronic kidney disease ("CKD") on dialysis and
iron deficiency anaemia in adult patients with CKD not on
dialysis.
Investment type Initial investment date
Secured loan 25 November 2019
Total loan amount Company commitment
$100m $50m
Maturity
November 2024
OptiNose
On 12 September 2019, the Company and the Private Fund entered
into a definitive senior secured note purchase agreement for the
issuance and sale of senior secured notes in an aggregate original
principal amount of up to $150 million by OptiNose US, Inc. a
wholly owned subsidiary of OptiNose Inc. Nasdaq: OPTN), a
commercial stage specialty pharmaceutical company ("OptiNose").
OptiNose drew a total of $130 million in three tranches: $80
million on 12 September 2019, $30 million on 13 February 2020 and
$20 million on 1 December 2020. There are no additional funding
commitments.
The Company and its subsidiaries funded a total $72 million
across all tranches. The notes mature in September 2024 and bore
interest at 10.75 per cent. per annum along with a one-time
additional consideration of 0.75 per cent. of the aggregate
original principal amount of senior secured notes which the Company
was committed to purchase under the facility and 445,696 warrants
exercisable into common stock of OptiNose at a strike price of
$6.72 In prior years, there were two amendments to the OptiNose
note purchase agreement, resulting in re-tiered sales covenants,
permission for an equity issuance, amended amortisation and
make-whole provisions, and the issuance of new three-year warrants,
with the original warrants being canceled. On 10 August 2022, the
OptiNose note and purchase agreement were amended resulting in
re-tiered sales covenants in exchange for an amendment fee of
$780,000, payable upon repayment, of which the Company will be
allocated $429,000. On 9 November 2022, OptiNose negotiated certain
waivers in exchange for a waiver fee, of which the Company earned
$715,000 of the total $1.3 million waiver fee. On 21 November 2022,
OptiNose entered into an Amended and Restated Note Purchase
Agreement (the "A&R NPA"). As part of the A&R NPA,
Pharmakon revised the sales covenants, amended the amortization and
make-whole, and modified the loan interest from a fixed rate of
10.75 per cent. to a floating rate equal to 3-month SOFR plus 8.50
per cent., subject to a 2.50 per cent. floor, in exchange for an
amendment fee. OptiNose's leading product, XHANCE (fluticasone
propionate), is a nasal spray approved by the U.S. Food and Drug
Administration (FDA) in September 2017 for the treatment of nasal
polyps in patients 18 years or older. XHANCE utilises a novel and
proprietary exhalation delivery system to deliver the drug high and
deep into the sinuses, targeting areas traditional intranasal
sprays are not able to reach.
Investment type Initial investment date
Secured loan 12 September 2019
Total loan amount Company commitment
$130m $72m
Maturity
June 2027
Bristol-Myers Squibb, Inc.
On 8 December 2017, the Company's wholly-owned subsidiary
entered into a purchase, sale and assignment agreement with a
wholly-owned subsidiary of Royalty Pharma Investments ("RPI"), an
affiliate of the Investment Manager, for the purchase of a 50 per
cent. interest in a stream of payments (the "Purchased Payments")
acquired by RPI's subsidiary from Bristol-Myers Squibb (NYSE: BMY)
through a purchase agreement dated 14 November 2017.
As a result of the arrangements, RPI's subsidiary and the
Company's subsidiary are each entitled to the benefit of 50 per
cent. of the Purchased Payments under identical economic terms. The
Purchased Payments are linked to tiered worldwide sales of Onglyza
and Farxiga, diabetes agents marketed by AstraZeneca, and related
products. The Company was expected to fund $140 million to $165
million during 2018 and 2019, determined by product sales over that
period, and will receive payments from 2020 through 2025. The
Purchased Payments are expected to generate attractive
risk-adjusted returns in the high single digits per annum. The
Company funded all of the Purchased Payments based on sales from 1
January 2018 to 31 December 2019 for a total of $162 million.
REALIZED INVESTMENTS
GBT
On 17 December 2019, the Company and the Private Fund entered
into a definitive senior secured term loan agreement for up to $150
million with Global Blood Therapeutics Inc. (Nasdaq: GBT), a
biopharmaceutical company focused on innovative treatments that
provide hope to underserved patient communities ("GBT"). GBT drew
down $75 million at closing and an additional $75 million on 20
November 2020. On 14 December 2021 the loan agreement was amended
and restated. The amendment increased the aggregate principal
amount of the loan to $250 million through a $100 million third
tranche, which was drawn on 22 December 2021. The Company and its
subsidiaries funded $133 million across all three tranches. The
loan was due to mature in December 2027 and bore interest at three-
month LIBOR plus 7.00 per cent. per annum subject to a 2.00 per
cent. floor along with a one-time additional consideration of 1.50
per cent. of the total loan amount paid upon funding and an
additional 2.00 per cent. payable upon the repayment of the loan.
The third tranche also incurred additional consideration of 1.50
per cent. at the time of funding. As a part of the amendment in
2021, the Company and its subsidiaries received a one-time fee
equal to 1.25 per cent. of the first two tranches and the
three-year make- whole period was reset to December 2021. On 5
October 2022, Pfizer acquired GBT and, as a result, GBT repaid its
$250 million senior secured loan. The Company received its $133
million of principal and $43 million in prepayment and make whole
fees. The Company and its subsidiaries earned a 27.6 per cent.
gross internal rate of return* and a 20.7 per cent net internal
rate** of return on its GBT investment.
SAREPTA
On 13 December 2019, the Company and the Private Fund entered
into a definitive senior secured term loan agreement for up to $500
million with Sarepta Therapeutics, Inc. (Nasdaq: SRPT), a fully
integrated biopharmaceutical company focused on precision genetic
medicine ("Sarepta"). On 24 September 2020 the Sarepta loan
agreement was amended, and the loan amount was increased to $550
million. Sarepta
drew down the first $250 million tranche at closing and an
additional $300 million on 2 November 2020. The Company and its
subsidiaries funded $175 million of each tranche for a total
investment of $350 million. The first tranche was originally due to
mature in December 2023 and the second tranche in December 2024.
The loan bore interest at 8.5 per cent. per annum along with a
one-time additional consideration of 1.75 per cent. of the first
tranche and 2.95 per cent. of the second tranche paid upon funding
and an additional 2 per cent. payable upon the repayment of the
loan. On 12 September 2022, Sarepta announced the early termination
and repayment of its existing senior secured debt with proceeds
from the issuance of $1 billion in convertible bonds. On 16
September 2022, Sarepta repaid its $550 million senior secured
loan. The Company received its $350 million of principal and $22
million in prepayment, paydown fees, make whole fees, and accrued
interest. The Company and its subsidiaries earned a 12.0 per cent.
gross internal rate of return* and 9.0 per cent net internal rate
of
return** on its Sarepta investment.
EPIZYME
On 4 November 2019, the Company and the Private Fund entered
into a definitive senior secured term loan agreement for up to $70
million with Epizyme, Inc. (Nasdaq: EPZM), a late-stage
biopharmaceutical company developing novel epigenetic therapies for
cancer ("Epizyme"). On 3 November 2020 the Epizyme loan agreement
was amended, and the loan amount was increased to $220 million.
Epizyme drew down $25 million at closing and an additional $195
million during 2020. The Company and its subsidiaries funded a
total of $110 million of the Epizyme loan. The loan was originally
due to mature in November 2024 and bore interest at LIBOR plus 7.75
per cent. per annum along
with a one-time additional consideration of 2 per cent. of the
total loan amount paid upon funding. On 27 June 2022, Ipsen
announced a definitive agreement pursuant to which Ipsen would
acquire Epizyme. On 12 August 2022, Epizyme repaid its $220 million
senior secured loan. The Company received its $110 million of
principal and $8 million in prepayment and makewhole fees. The
Company and its subsidiaries earned a 15.2 per cent. gross internal
rate of return* and 11.4 per cent net internal rate of return** on
its Epizyme investment.
COLLEGIUM 2020
On 6 February 2020, the Company and the Private Fund entered
into a definitive senior secured term loan agreement for $200
million with Collegium Pharmaceutical, Inc. (NaSsdaq: COLL), a
biopharmaceutical company focused on developing and commercialising
new medicines for responsible pain management ("Collegium 2020").
The Company and its subsidiaries funded $165 million of the $200
million loan on 13 February 2020. The secured loan began amortising
immediately and was due to fully mature in February 2024. The loan
bore interest at three-month LIBOR plus 7.50 per cent. per annum
subject to a 2.00 per cent. LIBOR floor with a one-time additional
consideration of 2.50 per cent. of the loan amount paid upon
funding. The loan was repaid in its entirety on 22 March 2022. The
Company and its subsidiaries earned a 11.9 per cent. gross internal
rate of return* and 8.9 per cent net internal rate of return** on
its Collegium 2020 investment.
BIODELIVERY SCIENCES
On 23 May 2019, the Company entered into a senior secured loan
agreement for up to $80 million with BioDelivery Sciences
International (Nasdaq: BDSI), a commercial-stage specialty
pharmaceutical company ("BDSI"). In addition, the Company acquired
5,000,000 BDSI shares at $5.00 each for a total cost of $25 million
in a public offering that took place on 11 April 2019. The first
tranche of the loan for $60 million was funded on 28 May 2019 and
the second $20 million tranche was funded on 22 May 2020. The loan
was due to mature in May 2025 and bore interest at LIBOR plus 7.50
per cent., along with 2.00 per cent. additional consideration paid
at closing. On 23 September 2021, BDSI made an early prepayment of
$20 million, and made its final payment for the remainder of the
loan on 22 March 2022. The Company earned a 11.9 per cent. gross
internal rate of return* and a 9.0 per cent net internal rate of
return** on the BDSI loan. The Company sold 46 per cent of its BDSI
shares during 2019 at an average price of $6.50 and received $5.60
per remaining shares on the date of the M&A Transaction. The
Company earned a 11.6 per cent. gross internal rate of return* and
a 8.7 per cent net internal rate of return** on the BDSI equity
investment.
MARKET ANALYSIS
The life sciences industry is expected to continue to have
substantial capital needs during the coming years as the number of
products undergoing clinical trials continues to grow. All else
being equal, companies seeking to raise capital are generally more
receptive to straight debt financing alternatives at times when
equity markets are soft, increasing the number and size of
fixed-income investment opportunities for the Company, and will be
more inclined to issue equity or convertible bonds at times when
equity markets are strong. A good indicator of the life sciences
equity market is the New York Stock Exchange Biotechnology Index
("BTK Index"). While there was substantial volatility during the
period, the BTK Index decreased 1 per cent. during the first six
months of 2023, compared to a 16 per cent. decrease during the same
period in 2022***. Global equity issuance by life sciences
companies during the first six months of 2023 was $22 billion, a 97
per cent. increase from the $11 billion issued during the same
period in 2022****. This dynamic contributed to additional deal
flow for the Company during the recent period from 4Q 2022 through
2Q 2023, as we deployed $207.5 million across three new investments
and an additional tranche of an existing investment. We anticipate
a continued slowdown in equity issuance coupled with greater
appetite for fixed income as a source of capital during the
remainder of 2023.
Acquisition financing is an important driver of capital needs in
the life sciences industry in general and a source of investment
opportunities. An active M&A market helps drive opportunities
for investors such as the Company, as acquiring companies need
capital to fund acquisitions. Global life sciences M&A volume
during the first six months of 2023 was $34 billion, a 31 per cent.
increase from the $26 billion witnessed during the same period in
2022.****
USD LIBOR
On 5 March 2021, the Financial Conduct Authority ("FCA"), the
regulatory supervisor of USD LIBOR's administrator ("IBA")
announced in a public statement the future cessation of the 3-month
USD LIBOR tenor setting. As of that date, 30 June 2023, all
available tenors of USD LIBOR have either permanently or
indefinitely ceased to be provided by IBA. As of 30 June 2023 the
benchmark replacement rate is based on Secured Overnight Financing
Rate ("SOFR"), and all LIBOR-based interest payments will now be
calculated with SOFR beginning on the respective effective date.
The Company has eleven loans with coupons that reference 3-month
USD SOFR and five have a 2.50 per cent. floor or greater and six
have a floor ranging from 1.00 per cent. to 2.00 per cent. As of 30
June 2023, the 3-month SOFR rate was 5.27 per cent, significantly
above the floors in the eleven loans.
INVESTMENT OUTLOOK
We expect our investment pipeline to grow as new products and
companies enter the market during the remainder of 2023.
Pharmakon's extensive network and thorough approach will continue
to identify strong investment opportunities. We remain focused on
our mission of creating the premier dedicated provider of debt
capital to the life sciences industry while generating attractive
returns and sustainable income to investors. Further, Pharmakon
remains confident of our ability to deliver its target dividend
yield to its investors.
Pedro Gonzalez de Cosio
Co-founder and CEO, Pharmakon
26 September 2023
* The gross internal rate of return of a particular investment
means an aggregate, annual, compounded, as applicable, internal
rate of return, calculated on the basis of historical capital
inflows and outflows related to a particular investment, without
taking into account the impact of management fees, incentive
compensation, taxes, or transaction and organizational costs and
expenses. Past performance is not an indication of future
performance.
** The net internal rate of return of a particular investment is
calculated by applying a 25% reduction to the respective gross
internal rate of return of a particular investment, which is the
average percentage reduction from the gross internal rate of return
and net internal rate of return from all previously realized
investments from prior closed private funds. The net internal rate
of return for realized investments in the prior closed prior funds
means an aggregate, annual, compounded, as applicable, internal
rate of return, calculated on the basis of realized capital inflows
and outflows for such investment, taking into account, the impact
of its proportional share of fees and expenses actually paid by its
relevant closed private fund. The Investment Manager believes this
methodology is the appropriate approach to derive an approximate
realized net internal rate of return for realized investments in
the Company. Past performance is not an indication of future
performance.
*** Source: BTK Index
**** Source: Bloomberg
Below are Case Studies for the new investments that the company
has funded during the first six months of the year.
CASE STUDY - ImmunoGen
ImmunoGen is a commercial stage biotechnology company focused on
developing and commercializing the next generation of antibody drug
candidates ("ADCs") to improve outcome for cancer patients.
established a leadership position in ADCs with a portfolio of
differentiated product candidates to address both solid tumors and
hematologic malignancies.
ImmunoGen's proprietary technology comprises an antibody that
binds to a target found on tumor cells and is conjugated to one of
ImmunoGen's potent anti-cancer agents to kill the tumor cell once
the ADC has bound to its target. ADCs are an expanding class of
anticancer therapeutics, with twelve approved products and the
number of agents in development growing significantly in recent
years. ImmunoGen has established a leadership position in ADCs with
a portfolio of differentiated product candidates to address both
solid tumors and hematologic malignancies.
On 14 November 2022, Elahere (mirvetuximab soravtansine-gynx)
received accelerated approval from the FDA for the treatment of
adult patients with FR<ALPHA> positive, platinum-resistant
epithelial ovarian, fallopian tube, or primary peritoneal cancer,
who have received one to three prior systemic treatment regimens.
The product subsequently launched in the US on 1 December 2022.
Ovarian cancer affects 20,000 women annually.
Elahere is a first-in-class ADC targeting folate receptor alpha
(FR), a cell-surface protein over-expressed in several epithelial
tumors, including ovarian, endometrial, and non-small-cell lung
cancers.
ImmunoGen is also developing pivekimab sunirine for the
treatment of blastic plasmacytoid dendritic cell neoplasm ("BPDCN")
and acute myeloid leukemia ("AML").
CASE STUDY - BIOCRYST
BioCryst is a global biopharmaceutical company that discovers
and commercializes novel, oral, small-molecule medicines.
BioCryst focuses on oral treatments for rare diseases in which
significant unmet medical needs exist and an enzyme plays the key
role in the biological pathway of the disease. BioCryst integrates
the disciplines of biology, crystallography, medicinal chemistry
and computer modeling to discover and develop small molecule
pharmaceuticals through the process known as structure-guided drug
design.
BioCryst's commercial product, Orladeyo (berotralstat), is
indicated for prophylaxis to prevent attacks of hereditary
angioedema ("HAE") in adults and pediatric patients 12 years
and older. HAE is a rare, severely debilitating and potentially
fatal genetic condition with a prevalence of between 1 in 33,000 to
1 in 67,000 people.
Orladeyo received US FDA approval on 3 December 2020, and was
subsequently approved in Japan on 22 January 2021 and the EU on 30
April 2021.
BioCryst also has one pipeline product in BCX10013, a factor D
inhibitor being studied in atypical hemolytic uremic syndrome
(aHUS), IgA nephropathy (IgAN), and complement 3 glomerulopathy
(C3G).
CASE STUDY - REATA
Reata is a biopharmaceutical company focused on identifying,
developing, and commercializing small-molecule therapeutics with
novel mechanisms of action for the treatment of severe,
life-threatening diseases with few or no approved therapies.
Reata's first commercial product, Skyclarys (omaveloxolone), is
indicated for Friedreich's Ataxia ("FA"), a rare neurological
disease. Skyclarys activates the transcription factor Nrf2 to
normalize mitochondrial function, restore redox balance, and
resolve inflammation.
FA is an inherited, debilitating, and degenerative neuromuscular
disorder that is typically diagnosed during adolescence and can
ultimately lead to premature death. Patients with FA experience
progressive loss of coordination, muscle weakness, and fatigue,
which commonly progresses to motor incapacitation, wheelchair
reliance, and eventually death. FA affects approximately 6,000
patients in the United States and 22,000 individuals globally.
Skyclarys received US FDA approval on 28 February 2023 and is
indicated for the treatment of Friedreich's Ataxia in adults and
adolescents 16 years and older.
Reata also has submitted a Marketing Authorization Application
for omaveloxolone for the treatment of FA to the EMA in Europe and
the application is under review. Reata is also developing
cemdomespib, the lead product candidate from the Company's Hsp90
modulator program, in neurological indications.
PHARMAKON ADVISORS' ESG POLICY
Pharmakon Advisors' ESG Policy can be found set out on pages 16
to 19 of the full Half-Yearly report.
STATEMENT OF DIRECTORS' RESPONSIBILITIES
INTERIM MANAGEMENT REPORT
The important events that have occurred during the period under
review, the key factors influencing the financial statements and
the principal factors that could impact the remaining six months of
the financial year are set out in the Chairman's Statement and the
Investment Manager's report above.
The Directors and the Investment Manager have considered the
adverse impact of potential changes in law, regulation and taxation
and the matter of foreign exchange risk.
The Directors have considered the principal risks facing the
Company and there have not been any material changes to the
principal risks and uncertainties and approach to mitigating these
risks since the publication of the Annual Report and Financial
Statements for the year ended 31 December 2022, and expect that,
for the remainder of the year ending 31 December 2023, these will
continue to be as set out on pages 26 to 32 of that report.
Risks faced by the Company include, but are not limited to:
-- Failure to achieve target returns;
-- The success of the Company depends on the ability and
expertise of the Investment Manager;
-- The Company may from time to time commit to make future
investments that exceed the Company's current liquidity;
-- The Investment Manager's ability to source and advise
appropriately on investments;
-- There can be no assurance that the Board will be able to find
a replacement investment manager if the Investment Manager
resigns;
-- Concentration in the Company's portfolio may affect the
Company's ability to achieve its investment objective;
-- Life sciences products are subject to intense competition and
various other risks;
-- Investments in debt obligations are subject to credit and
interest rate risks;
-- Risk that a counterparty is unable to honour its obligation
to the Company;
-- Sales of life sciences products are subject to regulatory
actions that could harm the Company's ability to make distributions
to investors;
-- Net asset values published will be estimates only and may
differ materially from actual results;
-- Changes in taxation legislation or practice may adversely
affect the Company and the tax treatment for shareholders investing
in the Company;
-- Global pandemics may affect the operation and performance of
the Company; and
-- Changes to accounting regulation may require the Company to
make a change in accounting policy that could have a material
impact on its reported results including its net asset value, net
income and distributable reserves.
GOING CONCERN
The financial statements continue to be prepared on a going
concern basis. The Directors have reviewed areas of potential
financial risk and cash flow forecasts.
No material uncertainties have been detected which would
influence the Company's ability to continue as a going concern for
at least 12 months from the date of this report. Accordingly, the
Board of directors continue to adopt the going concern basis in
preparing the financial statements. The important events that have
occurred during the period under review, the key factors
influencing the financial statements and the principal factors that
could impact the remaining six months of the financial year are set
out in the Chairman's statement and the Investment Manager's report
above.
DIRECTORS' RESPONSIBILITY STATEMENT
The Directors confirm that to the best of their knowledge:
-- this set of condensed financial statements has been prepared
in accordance with UK adopted International Accounting Standard
("IAS") 34, 'Interim Financial Reporting', and gives a true and
fair view of the assets, liabilities, financial position and profit
of the Company; and
-- this Half-Yearly Report includes a fair review of the
information required by:
(a) DTR 4.2.7R of the Disclosure Guidance and Transparency
Rules, being an indication of important events that have occurred
during the first six months of the financial year and their impact
on the condensed set of financial statements; and a description of
the principal risks and uncertainties for the remaining six months
of the year; and
(b) DTR 4.2.8R of the Disclosure Guidance and Transparency
Rules, being related party transactions that have taken place
during the first six months of the financial year and that have
materially affected the financial position or performance of the
Company during that period; and any changes in the related party
transactions that could do so.
This Half-Yearly Report was approved by the Board of Directors
on 26 September 2023 and the above responsibility statement was
signed on its behalf by Harry Hyman, Chairman.
On behalf of the Board
Harry Hyman
Chairman
26 September 2023
DIRECTORS, ADVISERS AND OTHER SERVICE PROVIDERS
DIRECTORS
Harry Hyman (Chairman)
Duncan Budge
Colin Bond
Stephanie Léouzon
Rolf Soderstrom
Sapna Shah
INVESTMENT MANAGER AND AIFM
Pharmakon Advisors, LP
110 East 59th Street #3300
New York, NY 10022
USA
ADMINISTRATOR
Link Alternative Fund Administrators Limited
Broadwalk House
Southerhay West
Exeter
EX1 1TS
COMPANY SECRETARY AND REGISTERED OFFICE
Link Company Matters Limited
6(th) Floor
65 Gresham Street
London
United Kingdom
EC2V 7NQ
Tel: +44 (0) 333 300 1950
COMPANY WEBSITE
www.bpcruk.com
CUSTODIAN
Bank of New York Mellon
One Canada Square
London
E14 5AL
FINANCIAL AND STRATEGIC COMMUNICATIONS
Buchanan Communications Limited
107 Cheapside
London
EC2V 6DN
INDEPENT AUDITOR
Ernst & Young
Harcourt Centre
Harcourt Street
Dublin
DO2 YA40
Ireland
JOINT BROKERS
J.P. Morgan Cazenove
25 Bank Street
London
E14 5JP
Goldman Sachs International
Peterborough Court
133 Fleet Street
London
EC4A 2BB
LEGAL ADVISER
Herbert Smith Freehills LLP
Exchange House
Primrose Street
London
EC2A 2EG
REGISTRAR
Link Group
10(th) Floor
Central Square
29 Wellington Street
Leeds
LS1 4DL
COMPANY INFORMATION
The Company is a closed-ended investment company incorporated on
24 October 2016. The Ordinary Shares were admitted to trading on
the Specialist Fund Segment of the Main Market of the LSE and TISE
on 27 March 2017.
The Company's shares were transferred to the premium segment of
the Main Market on 5 October 2021. The Company introduced a GBP
quote to appear alongside its USD quote on this date.
The Company delisted from the TISE on 8 October 2021.
The Company intends to carry on business as an investment trust
within the meaning of Chapter 4 of Part 24 of the Corporation Tax
Act 2010 and an investment company within the meaning of Section
833 of the Companies Act 2006.
INVESTMENT OBJECTIVE
The Company aims to generate long-term Shareholder returns,
predominantly in the form of sustainable income distributions from
exposure to the life sciences industry.
SUMMARY OF INVESTMENT POLICY
The Company will seek to achieve its investment objective
primarily through investments in debt assets secured by royalties
or other cash flows derived from sales of approved life sciences
products. Subject to certain restrictions and limitations, the
Company may also invest in unsecured debt and equity issued by
companies in the life sciences industry.
The Investment Manager will select investment opportunities
based upon in-depth, rigorous analysis of the life sciences
products backing an investment as well as the legal structure of
the investment. A key component of this process is to examine
future sales potential of the relevant product which is affected by
several factors, including but not limited to; clinical utility,
competition, patent estate, pricing, reimbursement (insurance
coverage), marketer strength, track record of safety, physician
adoption and sales history.
The Company will seek to build a diversified portfolio by
investing across a range of different forms of assets issued by a
variety of borrowers. In particular, no more than 30 per cent. of
the Company gross assets will be exposed to any single
borrower.
SHAREHOLDER INFORMATION
KEY DATES
March Annual results announced
Payment of fourth interim dividend
May Annual General Meeting
June Company's half-year end
Payment of first interim dividend
September Half-yearly results announced
Payment of second interim dividend
December Company's year end
Payment of third interim dividend
FREQUENCY OF NAV PUBLICATION
The Company's NAV is released to the LSE on a monthly basis and
is published on the Company's website.
ANNUAL AND HALF-YEARLY REPORT
Copies of the Company's Annual and Half-yearly Reports, stock
exchange announcements and further information on the Company can
be obtained from the Company's website www.bpcruk.com.
IDENTIFICATION CODES
SEDOL: BDGKMY2
ISIN: GB00BDGKMY29
TICKER: BPCR
LEI: 213800AV55PYXAS7SY24
CONTACTING THE COMPANY
Shareholder queries are welcomed by the Company. While any
queries regarding your shareholding should be directed to the
Registrar, shareholders who wish to raise any other matters with
the Company may do so using the following contact details:
Company Secretary - biopharmacreditplc@linkgroup.co.uk
Chairman - chairman@bpcruk.com
Senior Independent Director - sid@bpcruk.com
FURTHER INFORMATION
BioPharma Credit PLC's full Half Yearly Report for the period
ended 30 June 2023 will be available today on
https://bpcruk.com/
It has also been submitted in full unedited text to the
Financial Conduct Authority's National Storage Mechanism and is
available for inspection at
data.fca.org.uk/#/nsm/nationalstoragemechanism in accordance with
DTR 6.3.5(1A) of the Financial Conduct Authority's Disclosure
Guidance and Transparency Rules.
Neither the contents of the Company's website nor the contents
of any website accessible from hyperlinks on the Company's website
(or any other website) is incorporated into, or forms part of this
announcement.
This information is provided by RNS, the news service of the
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END
IR GUGDCIBDDGXR
(END) Dow Jones Newswires
September 27, 2023 02:00 ET (06:00 GMT)
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