Syncona to step up capital deployment after great year – Syncona has announced a whopping 37.9% return on NAV for the year ended 31 March 2019. It has transformed its portfolio so that life sciences investments now account for £1.06bn of the fund’s £1.46bn NAV.
Some highlights:
- foundation of three highly innovative portfolio companies OMASS Therapeutics (drug discovery), Anaveon (immuno-oncology), and Quell Therapeutics (cell therapy), in line with Syncona’s strategy to found, build and fund global leaders in healthcare;
- ongoing progress in the clinical pipeline with eight live clinical trials at year end;
- positive data delivered in Blue Earth (Glioma), Freeline (Haemophilia B) and Autolus (AUTO3 pALL (acute lymphoblastic leukemia) and DLBCL, AUTO1 pALL and adult ALL);
- commenced two new clinical trials Autolus (AUTO4, T Cell Lymphoma) and Gyroscope (FOCUS trial, Dry AMD);
- merger of Gyroscope (retinal gene therapy), with Orbit Biomedical (sub-retinal surgical platform), to create the world’s first end-to-end retinal gene therapy company with clinical, delivery and manufacturing capabilities;
- Blue Earth Diagnostics (Blue Earth) (commercial stage PET imaging agent) filed a supplemental New Drug Application with the U.S Food and Drug Administration (FDA) for use of Axumin in Glioma;
- strong progress developing industrial scale throughout the portfolio, in particular by continuing to invest in and develop key areas such as manufacturing and delivery in gene and cell therapy;
- capital deployment into life science companies of GBP138.6 million (2018: GBP127.2 million);
- strategic capital pool of GBP399.7 million at year end to fund our growing Life Science portfolio (2018: GBP541.3m);
- Blue Earth Diagnostics continued to deliver strong performance with sales of GBP83.9 million (2018: GBP35.9 million) and EBITDA of GBP28.7 million, Syncona’s 89 per cent stake is now valued at GBP267.5 million (2018: GBP186.8 million), a gain of GBP94.9 million over the year, including a GBP14.2 million distribution from the company;
- Nightstar (retinal gene therapy) targeting inherited forms of blindness, reached agreement to be acquired by Biogen for $877.0 million during the year, representing a 4.5x return on original investment for Syncona; GBP255.8 million of proceeds received post year-end (2018 valuation: GBP124.5 million);
- Autolus (CAR-T cell immunotherapy) completed a successful $172.2 million NASDAQ IPO (in which Syncona invested $24.0 million) followed by a $109.0 million follow-on financing post period end in which Syncona invested a further $24.0 million. Holding increased in value by GBP225.0 million to GBP328.2 million at year end (2018: GBP85.1 million). [However Autolus was also a Woodford favourite and the share price has come off since the period end in anticipation of Woodford being forced to sell most of his stake.];
- Freeline (systemic gene therapy) completed an GBP88.4 million Series B financing with an GBP85 million commitment by Syncona; and
- annual charitable donation of GBP4.3 million – continued support for Institute of Cancer Research and The Syncona Foundation.
More to do
“We believe there is a clear opportunity to invest at scale in the growing healthcare sector. We have built a portfolio of 10 companies at year end in innovative areas of life science, eight of which we founded. Our high-conviction approach means that we expect to deploy significant further capital across the portfolio this year.
We also see a strong pipeline of opportunities to found new companies. Our aim is to build a portfolio of 15-20 companies and we remain focused on areas where we are strategically positioned, such as cell and gene therapy, but also look at opportunities more broadly across a range of modalities and therapeutic areas.
As a result, we are increasing our guidance on annual capital deployment to GBP100 – 200 million this year (2018 guidance: GBP75-150 million).”
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