Impacting Cancer The global oncology investment firm May 2015 CONFIDENTIAL EUROPE AND REST OF WORLD ALL INFORMATION IN THIS PRESENTATION IS ONLY OF A PRELIMINARY NATURE AND MAY BE SUBJECT TO CHANGE. NEXTECH IV ONCOLOGY S.C.S. SICAV-SIF HAS BEEN APPROVED BY THE COMMISSION DE SURVEILLANCE DU SECTEUR FINANCIER (CSSF). THE COMPANY NEXTECH IV ONCOLOGY S.C.S. SICAV-SIF HAS BEEN INCORPORATED ON 17 SEPTEMBER, 2014. THE FIRST CLOSING OF THE FUND HAS TAKEN PLACE ON 26 SEPTEMBER, 2014. A SUBSCRIPTION OF INTERESTS CAN ONLY BE MADE ON BASIS OF THE ISSUING DOCUMENT AS WELL AS THE LIMITED PARTNERSHIP AGREEMENT IN THEIR MOST RECENT FORM AND ONLY AFTER APPROVAL OF THE LIMITED PARTNER BY THE GENERAL PARTNER. THIS IS A CONFIDENTIAL DOCUMENT THAT DOES NOT CONSTITUE A SALES DOCUMENT AND ACCORDINGLY IS NOT TO BE CONSTRUED AS AN OFFER OR INVITATION TO INVEST IN NEXTECH IV ONCOLOGY S.C.S. SICAV-SIF. IN ADDITION THIS DOCUMENT IS NOT TO BE MADE AVAILABLE TO THIRD PARTIES AND IN PARTICULAR MUST NOT BE MADE AVAILABLE TO THE PUBLIC NOR BE MADE AVAILABLE IN JURISDICTIONS WHERE THIS WOULD BE CONTRARY TO LOCAL LAWS AND REGULATIONS. SWITZERLAND THE PARTNERSHIP IS ESTABLISHED AS SICAV-SIF UNDER THE LAWS AND REGULATIONS OF THE GRAND DUCHY OF LUXEMBOURG AND IS COMPLIANT WITH SWISS LAW FOR DISTRIBUTION TO QUALIFIED INVESTORS IN OR FROM SWITZERLAND. THE SWISS REPRESENTATIVE IS CARNEGIE FUND SERVICES S.A., 11, RUE DU GÉNÉRAL-DUFOUR, 1204 GENEVA. THE SWISS PAYING AGENT IS BANQUE CANTONALE DE GENÈVE, 17, QUAI DE L'ILE, 1204 GENEVA. INVESTORS IN SWITZERLAND CAN OBTAIN THE DOCUMENTS OF THE PARTNERSHIP, SUCH AS THE ISSUING DOCUMENT, THE LPA, THE UNAUDITED QUARTERLY INVESTOR REPORTS, AND FURTHER INFORMATION FREE OF CHARGE FROM THE SWISS REPRESENTATIVE. THIS DOCUMENT MAY ONLY BE ISSUED, CIRCULATED OR DISTRIBUTED SO AS NOT TO CONSTITUTE AN OFFERING TO NON-QUALIFIED INVESTORS IN SWITZERLAND. RECIPIENTS OF THE DOCUMENT IN SWITZERLAND SHOULD NOT PASS IT ON TO ANYONE WITHOUT FIRST CONSULTING THEIR LEGAL OR OTHER APPROPRIATE PROFESSIONAL ADVISER, OR THE SWISS REPRESENTATIVE. UNITED STATES OF AMERICA THIS PRESENTATION HAS BEEN PREPARED IN CONNECTION WITH A PRIVATE OFFERING TO ACCREDITED INVESTORS OF LIMITED PARTNERSHIP INTERESTS (THE “INTERESTS”) IN THE FUND. THE INTERESTS HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR ANY UNITED STATES (“U.S.”) STATE SECURITIES LAWS OR THE LAWS OF ANY NON-U.S. JURISDICTION. THE INTERESTS WILL BE OFFERED AND SOLD UNDER THE EXEMPTION PROVIDED BY SECTION 4(2) OF THE ACT AND REGULATION D AND/OR REGULATION S PROMULGATED THEREUNDER AND OTHER EXEMPTIONS OF SIMILAR IMPORT IN THE LAWS OF THE STATES AND OTHER JURISDICTIONS WHERE THE OFFERING WILL BE MADE. THERE WILL BE NO PUBLIC MARKET FOR THE INTERESTS AND THERE IS NO OBLIGATION ON THE PART OF ANY PERSON TO REGISTER THE INTERESTS UNDER THE ACT OR ANY STATE OR NON-U.S. SECURITIES LAWS. Disclaimer Page 2 CONFIDENTIAL Nextech Invest – Global oncology investment I IV Page 3 Oncology – Value driver of the healthcare industry – Regulatory environment and pricing II Portfolio construction and investment process III Portfolio companies Team and organization CONFIDENTIAL I. Oncology: Value driver of the healthcare industry Executive summary Inception in 2006 Nextech Oncology Opportunity and Highlights Late stage private equity investments Focus on cancer therapeutics World leading scientists and drug developers in oncology as part of Nextech investment process Global investment approach Total amount raised: $140 m Late stage investments (3 - 5 years to exit) Improved risk/return relationship due to recent tremendous developments in science Focus on innovative, high value sector oncology, the Scientific Board Leaders in oncology with extensive experience in bringing breakthrough drugs to market largest and fastest growing healthcare market High proportion of trade sales creates independency from financial market cycles 14 investments Portfolio Page 4 CONFIDENTIAL 3 full exits 2 partial exits 4 IPOs 2 write downs 10 active companies I. Oncology: Value driver of the healthcare industry Page 5 CONFIDENTIAL I. Oncology: Value driver of the healthcare industry Opportunity in oncology “Increased understanding of the biology behind cancer should result in more selective treatments and more efficient clinical trials” 2014 “For the smaller research and development companies, the dawn of cancer genomics offers good business opportunities” 2014 “The drugs don't cure cancer and face significant hurdles. But doctors now talk of a "precision medicine" approach in which those pinpoint drugs can treat tumors far more effectively than catchall chemotherapy” 2013 “The newfound variants have led major cancer centers to revamp their approach to treating cancer and have spurred a rush among drug companies to find medicines that narrowly target each one” 2013 “Andrew Baum, analyst at Citigroup, predicts that annual revenues from so called immuno-oncology drugs could climb as high as $35bn, outstripping the value of previous blockbuster categories such as cholesterol-lowering statins” 2014 “Ms. Carey has one of at least 15 lung-cancer variations, almost all of which scientists didn't know existed 10 years ago. Researchers have identified those variations, most of them in just the past four years, by decoding DNA in tumors – akin to how crime labs analyze DNA to genetically fingerprint suspects” 2013 “Big BioPharma continues to source a significant portion of its pipeline externally (>>50%), in particular from venture-backed biotechs” 2014 “What we're seeing is the beginning of a revolution in therapeutics," says Janet Woodcock, director of the Food and Drug Administration's (FDA) Center for Drug Evaluation and Research. “We can only hope that this gets us to where cancer is managed or curable” 2013 Source: FT Special Report, Sep 26, 2014; Forbes Pharma & Healthcare: Startups, Exits, And Ecosystem Flux in Software and Biotech, Sep 8, 2014; Wall Street Journal: Gene Breakthroughs Spark a Revolution in Cancer Treatment, Aug 13, 2013 Page 6 CONFIDENTIAL I. Oncology: Value driver of the healthcare industry Large cancer patient population Oncology Science & research of cancer 14’100’000 estimated number of new cancer cases per year Cancer Uncontrolled cell growth caused by genetic mutations 0.5m 1.8m 1.2m 1.9m Normal cell 3.8m 1.8m 0.9m 0.1m 0.7m Unwanted cell growth 0.9m 0.2m 8.2 million cancer deaths pear year with 33 million patients in 2013 Main cause of death in developed countries – accounts for ~33% of deaths Tumor High unmet medical and diagnostic need Source: GLOBOCAN 2013, Region estimates do not sum to the worldwide estimate due to calculation method Page 7 CONFIDENTIAL I. Oncology: Value driver of the healthcare industry Oncology drives high value exits Trade sale exits not affected by cyclical markets # Economic crisis 40 Average trade sale value at time of exit # $m 200 600 30 150 20 100 10 50 0 400 200 0 0 2005 2006 2007 2008 2009 2010 2011 2012 2013 Biotech big exits (left axis) Biotech IPO (right axis) Economic crisis 2005 2006 2007 2008 2009 2010 2011 2012 2013 Trend line IPOs (right axis) Oncology leads in high value trade sales # $m 30 600 20 400 10 200 0 Exit by trade sale is an important and viable exit strategy for biotech companies especially during volatile public markets 0 Deals Avg valuation at exit Within the biotech sector, oncology companies create most trade sale exits and have the highest average value at the time of sale Data from 2005 - 2012 Source: Silicon Valley Bank: Trends in Healthcare Investments and Exits, 2014; Silicon Valley Bank: Trends in Mergers and Acquisitions, 2013; Jay Ritter, University of Florida, Initial Public Offerings: Updated Statistics, Dec 4, 2014 Page 8 CONFIDENTIAL I. Oncology: Regulatory environment and pricing Page 9 CONFIDENTIAL I. Oncology: Regulatory environment and pricing Oncology profits from special regulation Faster and more efficient approval of oncology drugs thanks to special regulatory status Breakthrough Therapy Average approval time (years) Approval times for oncology drugs are 50% shorter on average 2.0 34% 1.5 Oncology drugs represent 34% of all Breakthrough Therapy designations granted by FDA* 1.0 66% 0.5 0.0 Oncology Non-oncology Non-oncology Oncology Orphan Drug designation greatly improves the likelihood of approval Orphan Drug designation 50% Oncology 50% Non-oncology Oncology approval rate (likelihood of approval) Oncology drugs represent 50% of drugs receiving an Orphan Drug designation 25% 20% 15% 10% 5% 0% Total Orphan Oncology Orphan Drugs are 4 times more likely to be approved than nonorphan oncology drugs * FDA: Federal Drug Administration Source: Worldwide Clinical Trials White Paper, Mar, 2014: Expedited Review Programs For Oncology Drugs from the FDA; Tufts Center for the Study of Drug Development Report, 2007 Page 10 CONFIDENTIAL II. Portfolio construction and investment process Page 11 CONFIDENTIAL II. Portfolio construction and investment process Effective global deal sourcing More than 900 cancer companies screened resulting in 14 investments >900 companies analyzed, 14 investments Deal sources – Scientific Advisory Board – Investment peers – Professional network – Scientific venues Global deal screening – 47% USA – 32% Europe – 21% Rest of world Nextech invests based on – Scientific concept – Management track record – Matching investor syndicate Page 12 “We [Nextech’s SAB] operate as a group of collegial experts with highly complementary areas of expertise. Our most important responsibility is to identify and evaluate current scientific developments that have the potential to result in game-changing effects on cancer therapeutics. We recommend the very best of these opportunities to Nextech.” David Livingston, Chairman of SAB, Nextech Oncology Funds CONFIDENTIAL II. Portfolio construction and investment process Value creation in oncology 1 – 3 years Avg 1.5 years Avg 6.7 years Pre-clinical IND* Phase I Phase II NDA/ BLA* Phase III Commercial Value increase Main «exit window» in oncology 3 – 5 years horizon Value inflection Graphic is for illustration purpose, not to scale 0 2 4 6 8 10 12 14 Years The highest value increase of oncology assets occurs during Phase I and/or Phase II clinical trials that show early efficacy The sweet spot of Nextech Invest ( ) is to invest shortly before the main value increase leading to a 3 – 5 years holding period per company * IND: Investigational New Drug: regulatory application necessary for human trials; NDA/BLA: New Drug Application/Biologics License Application: Regulatory application necessary for commercialization Page 13 CONFIDENTIAL II. Portfolio construction and investment process Investment process Screening Technology Pathway/Target Indication Team Investors Due diligence Science/Concept Team Investors Intellectual property Clinical study design Finance and terms 120* Investment Term sheet negotiations Valuation Investor syndicate Corporate governance 20* 3-4* Portfolio Active assessment of progress and strategy Annual review including SAB Business and strategic support Exit Support M&A and IPO activities Connect to potential acquirer 12-16 (total) Board representation 3 step due diligence process Step 1 Nextech, 1 SAB member Step 2 Nextech, all SAB members Step 3 2 – 3 SAB members Written report – Scientific concept – (Pre-) Clinical data – Team – Competitive landscape Written report – Scientific concept – Clinical study design – (Pre-) Clinical data – Product potential – Exit strategy 1.5 hours call with target company to test scientific rigor, quality of the team, current results and development plan * Average number of companies per year Page 14 CONFIDENTIAL II. Portfolio construction and investment process Strong syndication partners Selection of recent syndicate partners Alta Partners MacroGenics, Sunesis Bay City Capital Sunesis Orbimed Agensys JAFCO Agensys, Tracon Lombard Odier Sunesis Biotech Value Fund Blueprint Medicines Novartis Bioventures ImaginAb Amgen Ventures TetraLogic Pfizer Ventures TetraLogic Clarus Ventures MacroGenics, TetraLogic Arcus Ventures MacroGenics, Tracon, Palyon Boehringer Ingelheim MacroGenics MPM MacroGenics Third Rock Ventures Blueprint Medicines Fidelity Bioscience Blueprint Medicines The Column Group Peloton Therapeutics Topspin Fund Peloton Therapeutics EcoR1 Capital Kura Oncology Remeditex Peloton Therapeutics Fidelity Investments Kura Oncology, Jounce Therapeutics Arch Ventures Kura Oncology Wellington Management Jounce Therapeutics Page 15 CONFIDENTIAL III. Portfolio companies Page 16 CONFIDENTIAL III. Portfolio companies Company portfolio Exit Portfolio Portfolio Portfolio IPO Exit Exit Agensys Pharmaceut., Inc. Santa Monica, USA Invested: 2007 Acquired: 2007 by Astellas MolecularMD Corp. Portland, USA Invested: 2012 ImaginAb, Inc. Inglewood, USA Invested: 2012 Palyon Medical Corp. Santa Clarita, USA Invested: 2009 Currently in liquidation Blueprint Medicines Corp. Cambridge, USA Invested: 2014 IPO: 2015 Ganymed Pharmaceut., Inc. Mainz, GER Invested: 2007 Acquired: 2008 by ATS Telormedix AG Bioggio, CH Invested: 2009 Sale of shares: 2011 Partial write-down Antibody platform Clinical phase I Genetic biomarker On market Tumor imaging Clinical phase II Implantable pumps In man Small molecules Pre-clinical Antibodies Pre-clinical Small molecules Clinical phase I Reverse merger Partial exit IPO Portfolio IPO Kura Oncology Inc. La Jolla, USA Invested: 2015 Reverse merger: 2015 Sunesis Pharmaceuticals, Inc. San Francisco, USA Invested: 2009 Partial sale of shares: 2010 2012 2014 Small molecules Tracon Pharmaceuticals, Inc. San Diego, USA Invested: 2011 IPO: 2015 Peloton Therapeutics, Inc. Dallas, USA Invested: 2014 Antibodies Clinical phase II Small molecules Clinical phase I Small molecules Clinical phase II Clinical phase III Portfolio company (Private) Successful exit Write-down IPO or public company Page 17 Partial exit IPO Portfolio MacroGenics, Inc. Rockville, USA Invested: 2011 IPO: 2013 Partial sale of shares: 2014 TetraLogic Pharmaceut. Corp. Malvern, USA Invested: 2011 IPO: 2013 Jounce Therapeutics, Inc. Cambridge, USA Invested: 2015 Antibodies Clinical phase II Small molecules Clinical phase II Antibodies Pre-clinical Most investments in the U.S. CONFIDENTIAL IV. Team and organization Page 18 CONFIDENTIAL IV. Team and organization Unique partnership with SAB Long-term partnership with Scientific Advisory Board (SAB) Experienced executive Nextech Invest management Experts in private equity, global pharma and finance 9 years of continuous partnership 6 member exclusive Scientific Advisory Board World leading scientists and drug developers in oncology The Scientific Advisory Board of Nextech Invest has a long-term relationship with the management team, a unique partnership with intense, unbiased, frank knowledge exchange between the two sides. The SAB members are exclusive to Nextech Invest and as such do not advise other private equity companies. All SAB members are world renown key opinion leaders in the field of oncology. The nine year personal relationship and financial participation and commitment in the funds enforces the alignment between the interest of the investors of Nextech Invest and the members of the Scientific Advisory Board. Page 19 CONFIDENTIAL IV. Team and organization Scientific Advisory Board World renown key opinion leaders in oncology David M. Livingston, MD, Chairman of the Board Deputy Director, Dana Farber Cancer Institute / Harvard Cancer Center Harvard Medical School, USA Member of the U.S. National Academy of Sciences and the U.S. Institute of Medicine Karl-Heinz Altmann, PhD Sir Bruce A.J. Ponder, PhD Professor of Pharmaceutical Sciences Swiss Federal Institute of Technology (ETH) Zurich, Switzerland Head of the Department of Oncology and Director of the Cambridge Cancer Center University of Cambridge, U.K. Fellow of the Royal Society Glenn Dranoff, MD, PhD* Charles L. Sawyers, MD Professor of Immunology Harvard Medical School, USA Am. Society for Clinical Investigation Chair, Human Oncology Program Memorial Sloan-Kettering Cancer Center, USA HHMI** Investigator U.S. National Academy of Sciences William G. Kaelin, MD Paul Workman, PhD Professor of Medicine Harvard Medical School, USA HHMI** Investigator U.S. National Academy of Sciences CEO and President Institute of Cancer Research (ICR), U.K. Professor of Pharmacology and Therapeutics, University of London, U.K. * Glenn Dranoff left the SAB end of Feb 2015 due to another job assignment, candidate identified; ** HHMI: Howard Hughes Medical Institute Page 20 CONFIDENTIAL IV. Team and organization Scientific Advisory Board experience Industry experience and knowledge of the SAB SAB company engagements Strong background in world leading pharma companies as well as successful biotech startups Crucial contribution to discovery and development of multiple blockbuster cancer drugs Active engagement in the advisory boards of more than 15 biotech companies including Agios, Peloton*, Seragon, Blueprint*, and Tracon* * Nextech Invest portfolio companies Page 21 CONFIDENTIAL $16bn annual sales of drugs with SAB contribution IV. Team and organization Investment management Experienced investment management team Alfred Scheidegger, PhD Thilo Schroeder, PhD Kristina Kakalacheva, PhD Roland Ruckstuhl, CPA Founding Partner & CEO Partner Associate CFO of Nextech Invest Ltd. 16 years private equity 15 years global pharma Harvard Business School (TGM) 3 years private equity 5 years entrepreneur 5 years experience in research University of Zurich 1 year private equity 5 years experience in research University of Oxford, University of Zurich 29 years auditor, Ernst & Young University of St. Gallen Key responsibilities: Deal sourcing, deal structuring, business assessment, board representation, investor relations Key responsibilities: Deal sourcing, deal structuring, scientific analysis, board representation Key responsibilities: Scientific analysis, deal structuring, compliance, fund management Key responsibilities: Finances, accounting, controlling, compliance Page 22 CONFIDENTIAL IV. Team and organization Financial, strategic and scientific expertise Senior and experienced advisors Thomas Lips, PhD Sinikka Demaré, CFA Marina Shargorodska SAB Partner Strategic Advisor Strategic Marketing Scientific Advisory Board 33 years banking and asset management 20 years CEO and CIO UBS, Goldman Sachs, AIG PB, Centrum Bank Global business and institutional investment management Advisor for asset allocation, risk management, and structured finance 10 years in biotech and asset management industries Global business development and strategic collaborations >200 cumulative years in cancer research & drug development Key responsibilities: Business assessment, legal, fundraising, finance, asset management Key responsibilities: Fundraising, finance, risk management, strategic management Key responsibilities: Fundraising and establishment of partnerships in developed and emerging markets Key responsibilities: Scientific investment strategy, due diligence of science and clinical development, deal sourcing Page 23 CONFIDENTIAL >1’900 scientific publications IV. Team and organization Nextech Invest Ltd. Specialist investment advisor in oncology - Worldwide Headquarter Zurich, Switzerland Founding year 1998 Previous investment fund Nextech I Emerging Technologies (1999 – 2011) | CHF74m, Delaware registered Active investment funds Investors Nextech II Oncology (2006) | €41.4m, Jersey regulated Nextech III Oncology (2010) | €34.6m, Swiss FINMA regulated Nextech IV Oncology (2014) | $40.1m ($100m targeted), AIFM regulated Institutional, asset management, strategic, private, family office, cancer foundation “Through its experienced team and distinguished Scientific Advisory Board, Nextech understands oncology. As one of their portfolio company CEOs, I appreciate Nextech’s investment well beyond their financial commitment.” Scott Koenig – President & CEO, MacroGenics, Inc. Page 24 CONFIDENTIAL Nextech Invest Ltd. Scheuchzerstrasse 35 8006 Zurich Switzerland Phone +41(0)44 366 66 11 info@nextechinvest.com www.nextechinvest.com Page 25 CONFIDENTIAL
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