BioPharma Credit PLC

30 July 2024

BIOPHARMA CREDIT PLC

(THE "COMPANY")

NEW INVESTMENT OF US$130.0 MILLION

The Company notes the filing of a Form 8-K made on 29 July 2024 by Collegium Pharmaceutical, Inc. ("Collegium"), which announced (i) the entering into of a definitive agreement pursuant to which Collegium will acquire all of the outstanding shares of Ironshore Therapeutics Inc. for US$525.0 million in cash at closing, with a potential US$25.0 million commercial milestone payment (the "Merger") and (ii) the second amendment and restatement of its loan agreement entered into with the Company, BioPharma Credit Investments V (Master) LP ("BioPharma-V"), and BPCR Limited Partnership (the "2^nd A&R Loan Agreement") to assist in financing the Merger.

The 2^nd A&R Loan Agreement provides for a US$645.8 million senior secured term loan, consisting of a US$320.8 million initial term loan ("Tranche A") and a new tranche for a US$325.0 million delayed draw term loan ("Tranche B"). Under the 2^nd A&R Loan Agreement, Collegium used the proceeds of Tranche A to refinance in full all outstanding indebtedness under Collegium's existing term loan with the Company and BioPharma-V. Tranche B will be used by Collegium to fund a portion of the consideration to be paid to complete the Merger, pay fees and expenses in connection with the Merger and the 2^nd A&R Loan Agreement and the remainder for general corporate purposes. The Merger is expected to close in the third quarter of 2024, subject to customary closing conditions, including receipt of required regulatory approvals.

The Company was allocated 40 per cent. of Tranche B, with BioPharma-V allocated 60 per cent. of Tranche B, which will result in Collegium representing approximately 21 per cent. of the Company's NAV if the Company had funded its allocation in Tranche B in full as of today.

Pedro Gonzalez de Cosio, CEO of Pharmakon Advisors, LP, the Company's investment manager commented: "We are pleased to continue to build upon our successful partnership with Collegium Pharmaceutical through this transaction. This investment marks Pharmakon's third loan to Collegium and the fifth involving these meaningfully differentiated therapies. Our initial investment was a US$575.0 million loan to Depomed, Inc. structured by Pharmakon in 2015 to fund the original acquisition of Nucynta from Johnson & Johnson, followed by the initial loans by the Lenders to Collegium (US$200.0 million) and BDSI (US$100.0 million), and the US$650.0 million loan to Collegium for the purchase of BDSI."

Background

The Company previously announced on 14 February 2022 a commitment to enter into a US$650.0 million senior secured loan to Collegium, with each of the Company and BioPharma-V investing up to US$325.0 million (the "Prior Loan Agreement"). The Company had previously funded to Collegium US$325.0 million at closing, and since 2022 Collegium repaid US$164.6 million to the Company resulting in a balance as of the entering into of the 2^nd A&R Loan Agreement of US$160.4 million.

Under the terms of the 2^nd A&R Loan Agreement, the five-year loan will bear interest per the Prior Loan Agreement (3-month SOFR plus 7.50 per cent. per annum plus a 0.26161 per cent. per annum adjustment subject to a 1.00 per cent floor) until Q3 2024 and thereafter, 3-month SOFR + 4.50 per cent. per annum plus a 0.130805 per cent. per annum adjustment subject to a 4.00 per cent. floor, with quarterly amortization payments equal to 2.50 per cent of the original funded term loans commencing in Q4 2024. A one-time additional consideration of 1.25 per cent. of Tranche A was paid at the signing of the 2^nd A&R Loan Agreement, and 2.25 per cent. of Tranche B payable at funding. There will not be a prepayment fee under the Prior Loan Agreement.

Collegium is a leading diversified specialty pharmaceutical company committed to improving the lives of people living with serious medical conditions. Collegium is publicly traded with a current market capitalization of ~US$1,180 million. Collegium currently markets Xtampza ER, an abuse-deterrent, extended-release, oral formulation of oxycodone, Nucynta (tapentadol), a centrally acting synthetic analgesic, Belbuca (buprenorphine buccal film), a Schedule III partial opioid agonist for the management of pain severe enough to require daily, around-the-clock, long-term opioid treatment, and Symproic (naldemedine) for the treatment of opioid-induced constipation (OIC). On 29 July 2024, Collegium reiterated 2024 guidance, excluding the impact of the acquisition, of US$580 to US$595 million in Net Product Revenues and US$380 to US$395 million in EBITDA.

Ironshore Therapeutics Inc. is a privately held, pharmaceutical company whose mission is to commercialize innovative, patient-focused treatment options to improve the lives of patients and caregivers. Jornay PM (methylphenidate HCl extended-release capsules) is a central nervous system (CNS) stimulant indicated for the treatment of attention deficit hyperactivity disorder (ADHD) in patients 6 years and older. According to Collegium, Jornay PM is poised to become Collegium's leading growth driver. Collegium expects net revenue for Jornay PM to be in excess of $100 million in 2024. According to Collegium, in the first half of 2024, Jornay PM prescriptions grew 32 per cent. year-over-year and for the full-year 2023, the product generated approximately 490,000 prescriptions, a 58 per cent. increase compared to 2022. Jornay PM is a highly differentiated treatment for ADHD due to its evening dosing, smooth therapeutic effect and dose-dependent duration.

Enquiries:

BioPharma Credit plc

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