Investment Banking, Business Development, Personalized Medicine
5
S. Jordan & Associates (SJA) is a life sciences investment banking and business development organization that assists small-mid sized biopharmaceutical companies raise seed/growth financing, and identify, structure, and negotiate deals with biopharmaceutical/pharmaceutical organizations. Fundraising through angel investors and venture capitalists remains one of the most challenging issues facing entrepreneurs. Executives often turn to SJA for assistance in raising funds through retail syndicators (broker/dealer networks) and institutional investors. SJA assists clients in structuring and arranging capital within all private equity and debt-related asset classes, including common stock, preferred stock, limited partnership interests, subordinated debt with equity conversion features, revolving lines of credit, and senior secured debt. Capital commitments are typically within a $5MM to $50MM target range and may include companies operating in North America, Asia, Mexico, South America, and the European Union. Acting as an intermediary between its clients and potential investors, SJA provides a buffer against unproductive solicitations, conducts the required due diligence on investor prospects, and screens out inappropriate investors, ensuring a smooth fundraising management process. Through our involvement and mediation, management can avoid the more tedious aspects of the capital raising process, and remain focused on day-to-day operations. SJA values potential deals through internal research and analysis to determine its capacity to attract suitable funding. Our industry focus and contact network assists clients through due diligence, including a detailed background check on the management team. Developing a strong, compelling investment thesis emphasizing the unique and exciting aspects of the transaction is critical. The sub-points of the thesis should differentiate the company from its competition and clearly illustrate revenue and profit growth. Private investors expect higher returns than public investors to compensate for increased risk and less liquidity. Working with our clients, we structure the security, terms, and valuation that will best meet the market and case-specific requirements. A private placement memorandum (PPM) should be a comprehensive but concise presentation. It must be of the highest quality and easily understood in order to differentiate it from the competition. In parallel with management’s drafting of the PPM, SJA develops an investor marketing plan and proprietary target list. The heart of the plan consists of a list of potential “lead” and “follow-on” investors that may include private equity and venture capital funds as well as secondary asset sources including hedge funds, pension funds, endowments, foundations and high net worth individuals. Life Sciences Business Development & Finance S. Jordan Associates Opportunities: Exploring Life Sciences MONTH YEAR OnBioVC 4Q10 & 2010 TREND ANALYSIS – BIOSCIENCE VC, M&A AND IPO OVERVIEW PUBLICATION DATE: 31 JANUARY 2011 OPPORTUNITY: For 2010 the oncology sector continued to exert its dominance in attracting life sciences capital, having led in both number of financings and dollars raised each quarter of the year. The largest deal came in 2Q10 from Boston, MA-based Tesaro who closed a $60M Series A financing ($20M upfront and a $40M reserve). The Company identifies, acquires and develops promising drug candidates for cancer treatments. CHALLENGE: Venture capital invested capital declined year-over-year (YOY) for both the 4Q10/4Q09 and 2010/2009 time periods. 4Q10 vs. 4Q09 (BioPharma) CAPITAL RAISED: • 2010: $ 434.4M • 2009: $1,003.8 FINANCINGS: • 2010: 28 • 2009: 50 2010 vs. 2009 (BioPharma) CAPITAL RAISED: • 2010: $3,012.1M • 2009: $3,583.0M FINANCINGS: • 2010: 153 • 2009: 181 SJA’s proprietary “Private Capital Market Database” provides unique financing sources.
Transcript
S. Jordan & Associates (SJA) is a life sciences investment banking and business development o rgan iza t i on tha t ass i s t s sma l l -m id s i zed biopharmaceutical companies raise seed/growth financing, and identify, structure, and negotiate deals with biopharmaceutical/pharmaceutical organizations.
Fundraising through angel investors and venture capitalists remains one of the most challenging issues facing entrepreneurs. Executives often turn to SJA for assistance in raising funds through retail syndicators (broker/dealer networks) and institutional investors.
SJA assists clients in structuring and arranging capital within all private equity and debt-related asset classes, including common stock, preferred stock, limited partnership interests, subordinated debt with equity conversion features, revolving lines of credit, and senior secured debt. Capital commitments are typically within a $5MM to $50MM target range and may include companies operating in North America, Asia, Mexico, South America, and the European Union.
Acting as an intermediary between its clients and potential investors, SJA provides a buffer against unproductive solicitations, conducts the required due diligence on investor prospects, and screens out inappropriate investors, ensuring a smooth fundraising management process. Through our involvement and mediation, management can avoid the more tedious aspects of the capital raising process, and remain focused on day-to-day operations.
SJA values potential deals through internal research and analysis to determine its capacity to attract suitable funding. Our industry focus and contact network assists clients through due diligence, including a detailed background check on the management team. Developing a strong, compelling investment thesis emphasizing the unique and exciting aspects of the transaction is critical. The sub-points of the thesis should differentiate the company from its competition and clearly illustrate revenue and profit growth. Private
investors expect higher returns than public investors to compensate for increased risk and less liquidity. Working with our clients, we structure the security, terms, and valuation that will best meet the market and case-specific requirements.
A private placement memorandum (PPM) should be a comprehensive but concise presentation. It must be of the highest quality and easily understood in order to differentiate it from the competition. In parallel with management’s drafting of the PPM, SJA develops an investor marketing plan and proprietary target list. The heart of the plan consists of a list of potential “lead” and “follow-on” investors that may include private equity and venture capital funds as well as secondary asset sources including hedge funds, pension funds, endowments, foundations and high net worth individuals.
L i f e S c i e n c e s B u s i n e s s D e v e l o p m e n t & F i n a n c eS. Jordan Associates
Opportunities:Exploring Life Sciences
MONTHYEAR
OnBioVC 4Q10 & 2010 TREND ANALYSIS – BIOSCIENCE VC, M&A AND IPO OVERVIEWPUBLICATION DATE: 31 JANUARY 2011
OPPORTUNITY: For 2010 the oncology sector continued to exert its dominance in attracting life sciences capital, having led in both number of financings and dollars raised each quarter of the year. The largest deal came in 2Q10 from Boston, MA-based Tesaro who closed a $60M Series A financing ($20M upfront and a $40M reserve). The Company identifies, acquires and develops promising drug candidates for cancer treatments.
CHALLENGE:Venture capital invested capital declined year-over-year (YOY) for both the 4Q10/4Q09 and 2010/2009 time periods.
4Q10 vs. 4Q09 (BioPharma)
CAPITAL RAISED:• 2010: $ 434.4M• 2009: $1,003.8
FINANCINGS: • 2010: 28• 2009: 50
2010 vs. 2009 (BioPharma)
CAPITAL RAISED:• 2010: $3,012.1M• 2009: $3,583.0M
FINANCINGS:• 2010: 153• 2009: 181
SJA’s proprietary “Private Capital Market Database” provides unique financing sources.
Sosei acquired Arakis: $181mln 2005
Eisai - MGI Pharma: $3.9Bln 2007
Astellas - Agensys: $387mln 2007
Shionogi - Sciele: $1.4Bln 2008
Dainippon Sumitomo - Sepracor: $2.6Bln 2009
Hisamitsu - Noven Pharma: $368mln 2009
Astellas - OSI Pharma: $3.9Bln 2010
Daiichi Sankyo - Plexxikon: $935mln 2010
Fina
nce
+ G
enom
ics SJA Corporate Finance Services
• Offer ing memorandum / management presentation preparation
• Financial valuation / modeling
• Seed capital/growth financing for early-mid stage biotech/pharma companies through retail syndicators
- Channels:• Broker / Dealers• Family offices • Aggregators• High net-worth individuals
SJA provides domestic and international clients with a wealth of corporate finance expertise and services, including:
SJA initiates contact with potential investors, forwards placement memorandums to interested parties, places follow-up calls to answer questions, and arranges management presentations. In meetings orchestrated and attended by SJA, management completes its investor presentation and responds to detailed questions. Subsequent due diligence requests, meetings or discussions are arranged with the goal of moving rapidly to a commitment. In tandem with our client, SJA negotiates with the lead investor(s) and, immediately thereafter, instruct counsel to draft a Letter of Intent or Definitive Purchase Agreement.
SJA assists clients in structuring and arranging capital with institutional sources of capital.
2.
Right now, all signs point to a burst of biotech buyouts in 2011. The latest portent comes from Bloomberg, which highlights the recent deals for Plexxikon and ProStrakan as indications that Japan's pharma companies are going to use their cache of cash to snap up more drug developers.
Bloomberg's numbers indicate that there was a 30 percent jump in the number of overseas deals completed by Japan's pharma companies in the past year, with a 72 percent spike in premiums. The business news service totted up 34 deals in the last 12 months. Not only do the Japanese pharma companies have money to spend, a stronger yen has added significantly to their fighting weight.
“Fierce Biotech 2011” – Japanese M&A Activity
Client Profile: TD2Genomics Solutions for Pharma/Biotech Pipelines
Francis S. Collins (National Human Genome Research Institute -HGRI) made 3 predictions following the mapping of the genome in 2000/2001:• Predictive genetic tests will be available for
a dozen conditions. • Interventions to reduce risk will be
available for several of these. • Many primary care providers will begin to
practice genetic medicine.
Over the past decade these predictions become reality. Next-generation signal molecule inhibitors that block the effects of genetic abnormalities that spur tumor growth (Herceptin - trastuzumab, Gleevec – imatinib, Erbitux -
cetuximab, Iressa – gefitinib) and biomarkers/companion diagnostics (ErbB2 receptor for Her2) were approved. Precision medicine, wherein patient DNA is collected and analyzed to find genetic signatures that allow drugs to be better tailored to specific patients, is shaping drug development as pharma/biotech focuses on accelerating clinical timelines, reducing costs and increasing probability of approval.
Leading biopharmaceutical organizations partner with TD2 to integrate genomics/informatics (“omic” science) with their pre/clinical programs for precision matching of patient treatment to a tumor’s molecular profile.
3.
TD2 - TGen Drug Development :• Leaders in bench discovery, precision
medicine, contract research (CRO), CMC (Chemistry, Manufacturing and Controls)
• Preclinical efficacy testing & Phase I - IIa trials:
- Preclinical efficacy testing (in vitro/vivo high-throughput genomic screening/pharmacogenomics), clinical trial design/project management, and regulatory consultation
- Structure/achieve value inflection points to increase probability of approval/partnering
• Pancreatic Cancer Research Team
TD2 Partners:• Avantra Biosciences
- TD2 selected as a key test site for Avantra's new biomarker quantitation platform enable the rapid measurement of biomarkers that can predict how cancer patients will respond to new drug therapies
• Horizon Discovery- GENESIS technology allow researchers for
the first time to routinely and precisely alter any specific gene or genomic location in a human cell
- Ability to take a non-cancerous cell and mutate it to create a cancerous cell that matches a given patients tumor
• Mayo Clinic• McKessen/U.S. Oncology• Van Andel Institute
“Getting the right drug to the right patient at the right time”
– Francis S. Collins, The Language of Life
Oncology Drug ApprovalsThe success rate in bringing new medicines to market in recent years is only about half of what it had been previously. And while oncology has been one of the hottest and most active therapeutic areas for drug development, drugmakers may want to take note of a finding that new cancer drugs have proven far more difficult to gain approval than medic ines for in fect ious and autoimmune diseases.
Data from a new study appears to bear that out. The study, covering 2004 through 2010, found the overall success rate for drugs moving from early stage Phase I clinical trials to FDA approval is about one in 10, down from one in five to one in six seen in reports involving earlier years. The study, c o n d u c t e d b y B I O a n d BioMedTracker reviewed more than 4,000 drugs from companies large and small and both publicly traded and private.
When broken down by therapeutic categories, the highest overall success rate from Phase 1 through likelihood of approval was infectious diseases, such as hepatitis and HIV drugs, at 12 percent, followed by endocrine system drugs, featuring d iabetes t reatments, at 10.4 percent, and autoimmune diseases, such as rheumatoid arthritis, at 9.4 percent, the study found. The overall success rate in oncology was the lowest of the therapeutic areas looked at, noting that cancer studies vary dramatically in design and extending survival sets a high bar for approval. The cancer drug success rate was a mere 4.7 percent, with cardiovascular drugs second-worst at 5.7. Reuters – February 2011
“Connectors are important for more than simply the number of people they know. Their importance is also a function of the kinds of people they know.”
– Malcolm Gladwell, The Tipping Point Bu
sine
ss D
evelo
pmen
tAccording to Reportlinker 2010, the number of in-licensing deals in 2009 increased by 12% over 2008, confirming that Big Pharma is actively seeking acquisitions and licensing agreements as a more cost effective means of gaining access to novel products than carrying out extensive in-house R&D. Early stage deals accounted for 60% of all product in-licensing deals (of which one-third is research and development), however, pharma increased its focus on Phase II/III in 2009 as it looked to offset the 2011 patent cliff by incorporating more advanced stage products into its pipelines.
SJA leverages its strong network of contacts with C-Level business development, operations, finance, and development professionals to secure valuable in/out-licensing/co-promotion agreements.
SJA Services:• New therapeutic/company identification • Assessing technology/science/due diligence/
Business Development: • Capitalize upon SJA biopharma network• Source early-stage oncology deal flow
from TD2 pipeline
Achieving Client Goals: SJA Provides a Unique Multidisciplinary Approach
Scott Jordan is an accomplished life sciences business development and investment banking professional with over 20 years of corporate experience in negotiating strategic corporate alliances, securing international licensing agreements, building national sales teams, and contributing to successful product development, approval, and launch. Cross functional leadership experience includes sales & marketing, licensing, compliance, regulatory, translational medicine, clinical development, and legal.
His expertise includes assisting senior executives with raising seed/growth financing and identifying, structuring, and negotiating licensing agreements with biopharmaceutical organizations.
Scott Jordan has a relationship with the world’s leading bench discovery and “precision” medicine organization, TGen Drug Discovery (TD2), interfacing with biotechnology companies seeking preclinical efficacy testing (in vitro/vivo high-throughput genomic screening/oncogenomics), innovative clinical design platforms, and strategies for rapid regulatory approval/NDA filing consultation.
Scott also consults with Healthios – a leading Chicago-based life sciences investment bank. Healthios launched the most comprehensive and dynamic investment research platform focused on the global healthcare industry, Healthios Exchange (H/X), in 2010.
Featuring Healthios’ proprietary ONE Technology, the H/X allows every investor, strategic buyer, private and public portfolio company, and Key Opinion Leader to customize their own online experience with resources and research specific to their interests: market data, growth forecasts, product pipelines, I/P reference, clinical trials information, competitive benchmarking, financing/M&A/strategic activity; company presentations; expert opinions; “one-on-one” requests; valuation data; transaction timelines; exclusive market indices and predictions.
Prior to forming SJA, Scott spent five years with Chicago-based oncology biotech company, NeoPharm, as Director of Business Development, and 3 years as a Regional Sales Manager for Akorn Opthalmics.
Before beginning his track record in the biotechnology field, Scott spent 3 years with Abbott Laboratories within their Diagnostic Division (ADD) in a commercialization role.
Sample experience includes:
• Retained by a leading venture capitalist, 3i Group, to assess the acquisition of a market leading silicone manufacturer of long-term medical devices including CRM/pacemakers, cochlear implants, and intraocular lenses (IOLs).
• Managing business development/licensing of a promising chronic kidney disease (CKD) therapeutic for ProMetic Life Sciences, a Montreal based biopharmaceutical company. Major Pharma conducting late-stage due diligence.
• Assisted CEO with secondary offering of 4.3 million shares at $18.25/share, underwritten by UBS Warburg and priced on 1/21/04. As a result, NeoPharm raised $74 million in net proceeds. The $18.25 offering price represented a 13% increase over the Company’s closing price three months earlier, a 36% increase over its closing price six months earlier, and a 127% increase over its closing price twelve months earlier.
• Signed a licensing agreement with Nippon Kayaku, a leading Japanese pharmaceutical company with over $1.2 billion in revenues for the rights to IL13-PE38QQR (glioblastoma multiforme) on December 28, 2004. NeoPharm received a $3 million upfront payment with potential milestones of $25 million.
• Negotiated a research/material transfer agreement with Wyeth-Ayerst resulting in a multi-million offer to license NeoPharm’s Phase I antisense compound, LErafAON, in 2002.
• #1 performing Sales Manager (revenue and profitability growth) at Akorn Opthalmics, a Chicago-based specialty pharmaceutical company.
• Placed 11th among 63 diagnostic representatives in the 1997 National President’s Club within Abbott’s Diagnostic Division (ADD). Successfully marketed oncology diagnostic equipment/reagents to physician offices and hospitals including oncology diagnostic assays: AFP (testicular), CA 125 (ovarian), CEA (various), and PSA (prostate).
Scott Jordan has a M.B.A. from the Kellstadt Graduate School of Management (DePaul) in finance and a B.A. from Michigan State University. He is a Level II Candidate in the Chartered Financial Analyst (CFA) Program and holds Series 7, 66, 63 & 31 Certifications.
