Need:

The CEO of a Swedish Advanced Therapy company asked MSC to support the due diligence process and term sheet analysis in an asset licensing negotiation and transaction with the aim of raising the deal value. This was a continuation of the successful work that MSC did around company repositioning and valuation assessment for the company – read more here.

Assignment:

MSC was asked by the company’s CEO to support an Advanced Therapy Medicinal Product (ATMP) asset licensing negotiation. The process included responding to due diligence questions connected to the valuation MSC previously conducted of the asset in question. In addition, the MSC team helped increase the company’s value share by analyzing the term sheet and supporting the decision-making process.

MSC’s proprietary valuation model was used as an important tool to assess counteroffers and selecting the most strategically beneficial offer. By utilizing the valuation tool, MSC could interpret the implications of each offer structure on the final value and visually demonstrate to the CEO and board members the impact the different offers could create.

Based on the results, it was possible to increase the agreement value by more than 10% by adjusting the royalties, milestones, and upfront payment structure. Ultimately, the term sheet was finalized for the CEO to bring it to the Board’s approval, and the deal was successfully concluded.

Need:

The CEO of a Swedish biotech within the Advanced Therapy Medicinal Product (ATMP) space reached out to MSC when it was time to ramp up their out-licensing efforts with the aim of landing a partnership deal.

The company had identified the need of a valuation for their main early-stage ATMP asset to have an idea of its value before initiating any out-licensing activities.

Assignment:

MSC was hired to conduct a valuation of the ATMP asset. The project was initiated with several strategic workshops and the collection of relevant data. After a deep market evaluation that included an analysis of the indication and patient population, competitive landscape and pricing, the team at MSC were able to identify several data driven assumptions to use. The results also indicated that the target patient population currently defined for the company’s business case no longer was the most logical or relevant to target. There was, in fact, another well-defined patient population in a higher need of this therapy that is also easier to access.

As a result of MSC’s insights, the company shifted its strategy and decided to target the newly identified patient population. The shift also resulted in a considerably larger business case given 1) an increased sized of the newly identified patient population and; 2) the assumption of a significantly higher product price due to e.g. health economics and other pricing benchmarks.

MSC’s proprietary valuation model was used to conduct the valuation and, together with evidenced and data driven assumptions, the valuation was highly useful in later licensing negotiations.