Pharma Transactions, Deal Negotiations

Case Study: Pharma Transactions, Deal Negotiations

The Pharma Transactions Challenge

A large corporation planned to sell one of its key technology platforms and the compound originating from the Intellectual Property.

The client asked PharmaVentures to generate a pharma transaction process and close a deal with the highest bidder for the opportunity.

The Solution

PharmaVentures conducted a thorough company screening and evaluation assessment to identify and prioritise potential acquirers with a good match for the technology and a strong strategic need in the relevant therapy area. Following the screening, within the space of a month PharmaVentures’ transaction team approached all the target companies with the value proposition using a non-confidential information memorandum and the consultants thorough knowledge of the scientific area.

After the exchange of Confidential Disclosure Agreements this was followed by due diligence, technical communication and road show run by the transaction experts on behalf of the client company management. This process achieved several high bids and a final attractive transaction value within six months of start of the project.

Partner / Product / Technology Screening

Case Study: Partner/ Product/ Technology Screening

The Challenge

A medium sized specialty pharma company was looking to expand its pipeline of product candidates using innovative drug delivery technologies. Having obtained funds for expansion the client wanted to screen out the most attractive products matching their core technology competencies and target markets.

The Solution

PharmaVentures designed a study combining primary and secondary research to assess unmet medical needs that the core technology could service as well as map out the competitive landscape in R&D to see the expected market shares of competitors and the clients potential products.

With the research highlighting key drivers for new technologies, PharmaVentures selected 15 product opportunities for in-licensing or in-house development with detailed evaluation of probable risks and returns.

Pharma Deal Strategy, Deal Structuring

Case Study: Pharma Deal Strategy, Deal Structuring

The Pharma Deal Strategy Challenge

A mid-sized life sciences manufacturing company with new cell lines developed a novel pipeline and they sought the partnership of a global or several regional pharmaceutical companies with strong competencies in clinical development and marketing in the focus therapy areas. However, the company had no clear understanding regarding the value the selected compounds were worth and how that value should be shared with their future partners.

The Solution

Following a detailed valuation phase, PharmaVentures conducted a comprehensive pharma deal strategy benchmarking analysis using PharmaDeals Agreements proprietary data to evaluate the possible deal outcomes and to identify three deal structures for the client: “Optimal”, “Fall-back” and “Walk-away” positions.

The developed deal structures were assessed for returns to the client across the life cycle of the products as well as regional versus global partnerships.

Life Sciences Valuation

Case Study: Life Sciences Valuation

The Life Sciences Valuation Challenge

A large diversified chemical company made a strategic decision to potentially divest one of its pharmaceutical related business units that lay outside its core strengths. In order to understand the potential sales returns and to develop a sales strategy, it needed to provide a life sciences valuation of the complex business.

The Solution

The valuation started with a due diligence phase when PharmaVentures investigated all the components of value including the markets, the manufacturing capabilities/facilities, the patents, the scientific skills, the impact of investments on future revenue streams and profitability. Furthermore, PharmaVentures developed a financial model using discounted cash-flow/expected net present value calculations. Potential divestment scenarios (outright sale, medium term earn-out) were also considered.

The client used the outputs to confidently seek out appropriate buyers and negotiate the most attractive terms.

Market Sizing & Forecasting

Case Study: Market Sizing & Forecasting

The Challenge

A Research & Development company was approaching the end of Phase II trials with a re-formulated compound. Although the company had confidence over their forecasts for the US, they lacked an understanding of the more complex European and Asian markets. They needed to gain a detailed understanding of the opportunities and risks prior to starting partnering negotiations.

The Solution

The market sizing project was designed for two stages. In Stage 1 PharmaVentures conducted a primary market research with Key Opinion Leaders in the main markets of focus to obtain data on potential use, penetration, price sensitivity of the product and its relative value compared to main current and future competitors.

This was complemented with a pipeline review of all novel compounds targeting the same segments. The outputs formed Stage 2, an epidemiology based, detailed forecasting across several markets that were impacted by key competitive, pricing and regulatory events. Subsequently the client went on to conduct a full valuation of the opportunity for the purposes of strategic alliances.