Biotech Exit Strategies: Delivering value to investors in a challenging funding market

Table of Contents

Executive Summary

• An introduction to biotech exit strategies
• Biotech exit trends
• IPO exit strategies
• M&A exit strategies
• Alliances and licensing exit strategies
• Building the path to exit

Chapter 1 An introduction to biotech exit strategies

• Summary
• Introduction
• The biotechnology funding lifecycle
• IPO as an exit strategy
• M&A as an exit strategy
• Alliance/licensing as an exit strategy
• Developing a path to exit

Chapter 2 Biotech exit trends

• Summary
• Introduction
• Biotechnology funding trends
• IPOs are down and will be for a while...
• M&A is up...
• Licensing is down slightly but still delivering value...
• Biotechnology productivity trends
• Biotech exit strategy trends
• IPO trends
• M&A trends
• Alliances/licensing trends
• Future exit strategy trends
• Reverse mergers
• Creative financing
• The quasi-public corporation

Chapter 3 IPO exit strategies

• Summary
• Introduction
• The traditional exit strategy
• Key benefits
• Key challenges
• Case study insights
• Bioheart - 2008' s only US IPO
• MolMed - 2008' s biggest IPO
• Acorda - Two rounds of follow-on offerings in 2008
• Talecris Biotherapeutics - IPO registration leads to acquisition
• Alimera Sciences - Proposed IPO withdrawn
• Key success factors
• Timing is everything...
• Products, products, products...
• Commercial validation from partners and investors...
• Corporate management talent...

Chapter 4 M&A exit strategies

• Summary
• Introduction
• The emerging exit strategy
• Key benefits
• Key challenges
• Case study insights
• Piramed - 2008 big pharma acquisition
• U3 Pharma - 2008 Japanese pharma acquisition
• OncoGenex Technologies - 2008 reverse merger
• IDM Pharma - Reverse merger at risk of delisting
• Protein Sciences - 2008 terminated biotech acquisition
• Key success factors
• Clinical validation...
• Commercial potential...
• Existing relationships...
• Committed management...

Chapter 5 Alliances and licensing exit strategies

• Summary
• Introduction
• The part exit strategy
• Key benefits
• Key challenges
• Case study insights
• Adnexus - Laying the tracks for an eventual buy-out
• MacroGenics - Generating a funding catalyst
• ChemoCentryx - Blockbuster strategic alliance, but no IPO
• Anacor - Key partnerships but no IPO
• Phenomix - Licensing instead of IPO
• Key success factors
• The right deal with the right partner at the right time...
• Reinforcing the long-term exit strategy...
• Creating, not limiting opportunities...

Chapter 6 Building the path to exit

• Summary
• Introduction
• Defining the objectives
• Asset-level exit
• Enterprise-level exit
• Keeping options open
• Setting the parameters
• Clinical
• Commercial
• Financial
• Building on success
• Responding to failure

Chapter 7 Appendix

• Research sources
• Bibliography

List of Figures

• Figure 1.1: The biotechnology funding lifecycle
• Figure 1.2: The biotechnology path to exit
• Figure 2.3: Global biotech funding trends (US$bn), 2004-08
• Figure 2.4: Global IPO trends, 2004-08
• Figure 2.5: Biotech M&A trends, 2004-08
• Figure 2.6: Biotech alliance and licensing deal trends, 2004-08
• Figure 2.7: Biotech alliance and licensing value trends (US$m), 2004-08
• Figure 2.8: New product approvals - leading biotechs versus leading pharma, 2004-08
• Figure 2.9: R&D productivity - leading biotechs versus leading pharma (US$bn), 2004-08
• Figure 2.10: Number and value (US$bn) of US biotech IPOs, 2004-08
• Figure 2.11: Number and value (US$bn) of M&As, 2004-08
• Figure 2.12: Biotech alliances and licensing trends (US$m), 2004-08
• Figure 2.13: Biotech alliances and licensing trends by development stage, 2004-08
• Figure 3.14: Average IPO exit values in US (US$m), 2004-08
• Figure 4.15: Average major biotech M&A exit values, 2004-08
• Figure 5.16: Average licensing/alliance part exit values (US$m), 2004-08
• Figure 6.17: Defining biotech exit objectives
• Figure 6.18: Setting biotech exit parameters

List of Tables

• Table 3.1: Leading US IPOs (US$m), 2004-08
• Table 3.2: Bioheart profile: 2008' s only US IPO
• Table 3.3: MolMed profile: 2008' s biggest IPO
• Table 3.4: Acorda profile: 2008' s only double follow-on offering
• Table 3.5: Talecris Biotherapeutics profile: 2008 proposed IPO leads to M&A
• Table 3.6: Alimera Sciences profile: 2008 proposed IPO withdrawn
• Table 4.7: Leading private biotech M&A deals, 2006-08
• Table 4.8: Piramed profile: 2008 big pharma M&A exit
• Table 4.9: U3 Pharma profile: 2008 Japanese pharma M&A exit
• Table 4.10: OncoGenex Technologies profile: 2008 reverse merger
• Table 4.11: IDM Pharma profile: reverse merger at risk of delisting
• Table 4.12: Protein Sciences profile: terminated 2008 biotech M&A exit
• Table 5.13: Leading private biotech licensing and alliance deals (US$bn), 2006-08
• Table 5.14: Adnexus profile: strategic alliance leading to 2007 M&A exit
• Table 5.15: MacroGenics profile: strategic alliance as a 2008 funding catalyst
• Table 5.16: ChemoCentryx profile: strategic alliance but no 2008 IPO
• Table 5.17: Anacor profile: two key partnerships but no 2008 IPO
• Table 5.18: Phenomix profile: 2008 strategic alliance instead of IPO