BioPharma Credit PLC

27 March 2024

This announcement contains inside information as defined in the Market Abuse Regulation No. 596/2014 as it forms part of UK Domestic Law by virtue of the European Union (Withdrawal) Act 2018 ("MAR").

BIOPHARMA CREDIT PLC

(THE "COMPANY")

UPDATES TO THE DISCOUNT CONTROL MECHANISM

BioPharma Credit PLC (LSE: BPCR), the specialist life sciences debt investor, announces the following updates to its Discount Control Mechanism ("DCM") following consultation with certain shareholders that hold, in the aggregate, a majority of the Company's shares.

Under the current terms of the DCM, as originally described in the Company's Prospectuses dated 1 March 2017 and 14 March 2018, and subsequently revised as of 7 November 2022, if the shares of the Company trade at a discount greater than 5 per cent. over a three-month period (the "First Trigger"), the Company is required to apply up to 50 per cent. of proceeds from debt repayments in purchasing Company shares until such time that the two-week discount is less than 5 per cent. In addition, if the discount is greater than 10 per cent. over a six-month period (the "Second Trigger"), the Company is required to apply up to 100 per cent. of proceeds from debt repayments until such time that the two-week discount is less than 5 per cent.

Currently, the Company continues to operate with the Second Trigger activated and must therefore reserve the entirety of US$155 million to purchase shares, which the Company has been pursuing at scale. During the first two months of 2024 the Company acquired approximately 49 million shares at a total cost of US$46 million at an average price of US$0.93 yet the current discount remains at 10.23%.

As previously announced on 15 March 2024, the Company was unable to participate in the new additional US$100,000,000 senior secured loans to UroGen Pharma, Inc. due to adherence with the DCM. The current coupon of the foregone UroGen investment is SOFR + 7.25 per cent., or 12.80% at current SOFR rates excluding additional fees payable upon drawing. Continued adherence to the current formulation of the DCM will result in the Company being unable to participate in any new investments until the DCM condition is satisfied.

While the Investment Manager and the Board firmly believe in the value of a discount control mechanism, they also believe that being prevented from deploying considerable available resources in any new investment opportunities due in large part to adverse market conditions, is not in the best interest of shareholders:

·    While the near-term accretion from share repurchases can be attractive, this ignores the significant opportunity cost of foregoing new investments with compelling return characteristics that would help the continued diversification of the portfolio.

·    As a result of current market conditions for investment companies, even large repurchases are having a limited impact on discounts to NAV.

·    Holding back cash to fund future repurchases, as opposed to investing in new loans, has a material cash drag effect. Meanwhile funding new investments using debt while holding significant cash is also not in the best interest of the Company.

·    On 28 December 2023, 94.06% of the voting shareholders of the Company voted in favor of approving the continuation of the Company's business as a closed-ended investment trust.

Revised Terms of the DCM

As a result, the Investment Manager and the Board believe it is in the best interest of the Company to update the DCM so as to provide for greater flexibility as to when the Company can freely deploy capital:

·    The First Trigger will remain at a 5 per cent. discount to NAV and the Company will be required to use up to US$25,000,000 in any given fiscal year of the principal being returned to repurchase shares until such time that the discount to NAV over a two-week period is less than 5 per cent.

·    The Second Trigger will remain at a 10 per cent discount to NAV and the Company will be required to use up to US$50,000,000 in any given fiscal year of the principal being returned to repurchase shares until such time that the discount to NAV over a two-week period is less than 5 per cent.

·    For the remainder of calendar year 2024 the Company will be required to use up to an additional US$50,000,000, on top of purchases made up to this date, to repurchase shares until such time that the discount to NAV over a two-week period is less than 5 per cent.

·    The Company may continue to repurchase shares in excess of the abovementioned thresholds in its discretion based on the then current trading price and volume in order to reduce the discount to NAV.

·    The Company will be free to use cash on hand in excess of the aforementioned amounts to make new investments.

The Board will consider future changes to the DCM if it considers them to be in the best interest of the Company and the shareholders. The Company intends to continue to purchase shares opportunistically with available capital even if the DCM triggers have not been reached. There will be no changes to the requirement of the Investment Manager to use a portion of the proceeds earned as incentive compensation to purchase shares under certain share price scenarios.

Revised DCM language

If, in any 3 month rolling period, the Shares have, on average, traded at a discount in excess of 5 per cent. to the Net Asset Value per Share (calculated by comparing the middle market quotation of the Shares at the end of each month in the relevant period to the prevailing published Net Asset Value per Share (exclusive of any dividend declared) as at such month end and averaging this comparative figure over the relevant period), the Company will, subject to meeting its Target Dividend, use up to US$25,000,000 of the Company's capital proceeds generated after the conclusion of such 3 month rolling period in any fiscal year, to repurchase Shares at least until such time as the Shares trade at an average discount of 5 per cent. or less to the Net Asset Value per Share over a 2 week rolling period.

If, in any 6 month rolling period, the Shares have, on average, traded at a discount in excess of 10 per cent. to the Net Asset Value per Share (calculated by comparing the middle market quotation of the Shares at the end of each month in the relevant period to the prevailing published Net Asset Value per Share (exclusive of any dividend declared) as at such month end and averaging this comparative figure over the relevant period), the Company will, subject to meeting its Target Dividend, use up to US$50,000,000 of the Company's capital proceeds generated after the conclusion of such 6 month rolling period in any fiscal year, to repurchase Shares at least until such time as the Shares trade at an average discount of 5 per cent. or less to the Net Asset Value per Share over a 2 week rolling period.

Previous DCM language

If, in any 3 month rolling period, the Shares have, on average, traded at a discount in excess of 5 per cent. to the Net Asset Value per Share (calculated by comparing the middle market quotation of the Shares at the end of each month in the relevant period to the prevailing published Net Asset Value per Share (exclusive of any dividend declared) as at such month end and averaging this comparative figure over the relevant period), the Company will, subject to meeting its Target Dividend, use 50 per cent. of the Company's capital proceeds generated after the conclusion of such 3 month rolling period, to repurchase Shares at least until such time as the Shares trade at an average discount of 5 per cent. or less to the Net Asset Value per Share over a 2 week rolling period.

If, in any 6 month rolling period, the Shares have, on average, traded at a discount in excess of 10 per cent. to the Net Asset Value per Share (calculated by comparing the middle market quotation of the Shares at the end of each month in the relevant period to the prevailing published Net Asset Value per Share (exclusive of any dividend declared) as at such month end and averaging this comparative figure over the relevant period), the Company will, subject to meeting its Target Dividend, use 100 per cent. of the Company's capital proceeds generated after the conclusion of such 6 month rolling period, to repurchase Shares at least until such time as the Shares trade at an average discount of 5 per cent. or less to the Net Asset Value per Share over a 2 week rolling period.

Enquiries

Buchanan

David Rydell / Mark Court / Jamie Hooper / Henry Wilson

+44 (0) 20 7466 5000

biopharmacredit@buchanan.uk.com

Notes to Editors

BioPharma Credit PLC is London's only specialist debt investor to the life sciences industry and joined the LSE in March 2017. The Company seeks to provide long-term shareholder returns, principally in the form of sustainable income distributions from exposure to the life sciences industry. The Company seeks to achieve this objective primarily through investments in debt assets secured by royalties or other cash flows derived from the sales of approved life sciences products.

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