Pharma Licensing, Partnering & Dealmaking Services
We provide a full range of pharma licensing services for drugs in development and technology platforms. Alacrita services include data room and pitch deck preparation, partnerability and mock due diligence assessments, outreach strategy and execution, third-party due diligence support, asset valuation and deal comps, term sheet and contract negotiation. We take a flexible approach that can include any or all of the above, by dovetailing with your existing internal team, or taking on full-responsibility for your partnering efforts.
Sell-Side
Our full out-licensing process consists of the following steps.
Stage 1 - Preparation
- Building a secure electronic data room to house all your relevant asset information.
- Conducting a partnerability assessment to find any gaps or flags that could affect your ability to partner an asset, and a mock DD to get a read on likely question areas by prospective partners.
- Creating compelling pitch decks for use during company outreach.
- Performing a comprehensive search for prioritization of prospective partners. These are filtered and ranked based on their technical fit.
- Developing an approach strategy for each prospective partner, based on our relationships and knowledge of the company.
Stage 2 - Outreach
- Working with you to implement the outreach strategy.
- Facilitating access to confidential data, through a CDA and the virtual data room.
- Coordinating the communication between prospective partners and our client through the due diligence and Q&A process.
- Prepare for deal negotiation: rNPV asset valuation and deal comps
Stage 3 - Negotiation
- Support negotiations of financial deal terms (we can lead negotiations if requested).
- Work alongside legal team to negotiate contract language.
Partnerability Assessments
Alacrita has substantial experience conducting partnerability assessments for development drugs and technologies. This is an important early component of the partnering process, and fosters a success mindset from the outset, when time and budget are available to focus on data must-have’s and key differentiators. A useful tool in the process is a Target Licensing Profile (TLP), through which the required set of evidence that would attract meaningful partnering interest from Big Pharma/Big Biotech, is described.
Conceptually, the TLP is an adaptation of the much-used TPP tool that guides development to successful approval and commercialization. In this case though, the destination is a licensing deal. A TLP is ideally drafted at the start of formal development activities - several years in advance of the search for a development and/or commercial partner - and is adjusted on a continuous basis to remain relevant. Both secondary and primary research approaches can be used to generate and/or test TLP assumptions. This will provide the program team insights into the scope and depth of studies required to bring the asset to a stage where it is partnerable. Learn more
Buy-Side
Alacrita also provides our clients a set of in-licensing services
- Asset Scouting: We help companies to identify assets, technologies, and companies for licensing, collaboration or acquisition (insert link). Learn more.
- Technical Due Diligence: We assemble teams of well-qualified expert consultants to assess the preclinical, CMC, regulatory, and clinical aspects of a licensing candidate to help clients assess the risk and/or value potential of an asset or technology. Learn more.
- Deal Negotiation: Similar to the sell-side deal-making support, our pharma transactions specialists help clients to negotiate in-licensing deal terms and contracts.
Selection of Recent Projects
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Negotiation support for essential component: A privately-held company developing a universal cancer vaccine was facing negotiations with a party possessing a unique co-factor which was an essential component of the final formulation. Alacrita's client sought strategic advice regarding the optimal time to engage with the counter-party as well as on the construction and terms of the prospective deal.
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IP negotiation support: A client urgently needed legal access to specific background IP that was in the possession of a company with a shared heritage. The urgency stemmed from an impending financing transaction, and it was essential that the client had clearly established rights in order to be in condition to withstand due diligence.
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Input into term-sheet negotiations: For a discovery-stage microbiome company, Alacrita developed a preclinical research strategy for its inflammatory bowel disease program. We then developed the high-level strategy into a detailed workflow and subsequently assisted with implementation including putting in place the preclinical models required.
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Deal benchmarks and term sheet appraisal for an early-stage license deal: An early-stage investor was in the midst of setting up a NewCo for the research and development of novel treatments using a fairly under-researched area of cell biology. However, a separate technology from one of the investor's portfolio companies was required for some characterization work in the NewCo. Given our client is a significant shareholder in both companies, they found themselves in a conflicted position with regards to developing objective benchmarks for a licensing deal. Alacrita was therefore called upon to develop relevant deal benchmarks, as well as appraise a draft term sheet for an arms length agreement between the two companies.
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Valuation of pharma licensing opportunity to support the deal-term negotiations: A privately capitalized biotech company in US, which was developing a pipeline of novel drugs to impact iron metabolism, wanted help with the valuation of in licensing opportunity for a rare disease indication to support the deal term negotiations.
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Modeling front-loaded deal vs. risk sharing for molecular design collaboration: A drug discovery company was in discussions with a big pharma about collaborating on a number of strategies that would deliver at least one quality clinical candidate. The pharma company had offered two types of deal: a front-loaded arrangement with R&D costs and milestones up to candidate delivery, and a risk-sharing deal where some of the compensation was to be back-loaded with milestones payable up to market, and possible royalties on net sales. The client asked us to assess its deal-making strategy, develop valuation models and advise on the negotiation strategy with its prospective partner.
Selection of Licensing, Partnering & Deal-Making Case Studies
Challenge: A public biotech company developing novel immunomodulatory enzymes had been approached by several gene therapy companies interested in licensing the enzyme technology to ablate/minimize the host immune response to AAV viral vectors. Alacrita was asked to evaluate the size of the opportunity and develop an optimal licensing strategy for the biotech company.
Solution: We completed the project in a three-step process:
- Step 1: We evaluated the potential for the product in gene therapy by characterizing the prospective commercial opportunity in terms of current gene therapy pipelines, size of the commercial opportunity for benchmark products, considering existing and prospective future alternative approaches to mitigate or obviate the immunogenicity of viral vectors. Following this, Alacrita assessed alternative licensing strategies against the prospective commercial opportunity, including exclusive licensing to a single player, non-exclusive licensing to multiple gene therapy companies, or exclusive licensing by field of use.
- Step 2: Using the results from Step 1, we estimated the risk adjusted net present value of the product using our Monte Carlo valuation methodology.
- Step 3: Alacrita then evaluated deal structuring options to develop a preferred licensing strategy. This involved developing a set of template deal terms, based on our experience of similar transactions and relevant benchmarks together with our analysis of distribution of deal value between the biotech company and a prospective licensee(s).
The biotech company used the valuation and deal terms to negotiate with several pharma companies in order to obtain the best deal possible for its technology.
Challenge: A public biotech company with a portfolio of clinical stage assets needed to supplement its internal business development capabilities to find a worldwide licensing partner for a Phase II asset.
Solution: Alacrita provided full business development support to the company. We conducted an extensive and systematic analysis to develop a long list of potential partners for the asset, prioritized by the commercial fit, including therapeutic area capabilities, existing product portfolio and financial strength. For each partner, we identified the right, senior level business development contact (if we didn’t already have contacts in the company).
In parallel, we worked with the client to optimize and refine the partnering materials. This including a succinct non-confidential two-pager, a non-confidential presentation and a confidential electronic dataroom with preclinical, clinical and other data.
We then reached out to the prospective partners, hosted introductory telephone calls, coordinated CDAs, managed dataroom Q&A and moved a number of parties to termsheet. A deal was signed 12 months from initiation of the engagement, and the client asked us to help with partnering of another of its assets.
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