Confidential Draft
Project Jaguar
Discussion Materials
August 31, 2021
Goldman Stanley
1
Project Jaguar
Table of Contents
Goldman Stanley
Section 1
Market Update and Summary
3
Section 2
Review of Jaguar Management Forecasts
7
Section 3
Jaguar Valuation
15
Section 4
Potential Strategic Alternatives
27
Section 5
Process Recommendations
39
Appendix A
Financial Projection Assumptions
44
Appendix B
Valuation Data
48
2
Section 1
Market Update and Summary
Goldman Stanley
3
Project Jaguar
MARKET UPDATE AND SUMMARY
Executive Summary
Jaguar Could Achieve a Positive Outcome for Shareholders with the Right Process
Current Valuation
Jaguar is Significantly Undervalued at Its Current Share Price
 Over the past year, Jaguar’s share price has ranged between $131.51 and $186.42, recently falling by
25% after its Q2 earnings announcement
 The Comparable Public Companies, Precedent Transactions, and a Discounted Cash Flow (DCF)
analysis based on management numbers point to a company undervalued by at least 30%
Strategic Alternatives
Equity / Debt Issuances and Add-On Acquisitions Are Not Ideal
 Jaguar’s Debt / Total Capital is nearly 50% following the GW Pharma acquisition, and issuing Equity
near the 52-week-low share price would create significant dilution
 Given Jaguar’s Cash balance and the constraints above, smaller deals may be viable, but nothing that
would substantially change the company’s short-term valuation
Proposed Process
A 30 – 50% Premium ($170 – $200) is Possible with the Right Process
 Jaguar’s promising portfolio and market position could allow it to achieve a significantly higher
valuation in an acquisition and acquire more resources for R&D and distribution
 We recommend a highly targeted process focused on the most likely (“Tier 1”) potential partners,
along with an outreach to Tier 2 potential partners
Goldman Stanley
4
Project Jaguar
MARKET UPDATE AND SUMMARY
Biopharma Market Environment
Last Twelve Months’ Performance
Summary Statistics:
Share Price Performance
(Last Twelve Months; Rebased to 100%)
60%
L3M
LTM
Jaguar
(35%)
(2%)
S&P 500
9%
29%
NBI(1)
14%
26%
XBI(2)
5%
19%
50%
40%
30%
29%
26%
20%
19%
10%
0%
(2%)
(10%)
31-Aug-20 06-Oct-20 10-Nov-20 16-Dec-20 25-Jan-21 02-Mar-21 07-Apr-21 12-May-21 17-Jun-21 23-Jul-21 31-Aug-21
Jaguar
S&P 500
NBI(1)
XBI(2)
Source: Capital IQ data as of August 31, 2021.
Goldman Stanley
(1) Nasdaq Biotechnology Index (market capitalization-weighted).
(2) S&P Biotechnology Index (market capitalization-weighted).
5
Project Jaguar
MARKET UPDATE AND SUMMARY
Jaguar Annotated Stock Price Performance
Last Twelve Months’ Performance
Jaguar Market Statistics:
($ in Millions Except per Share
Data)
Share Price Performance and Volume Traded
Share Price (USD)
$200.00
Share Price(1):
$131.71
$190.00
Basic Shares(2):
61 M
$180.00
FDSO(2):
63 M
$170.00
Market Cap:
$8,306
$160.00
Cash(3):
(896)
$150.00
NOLs(4):
(80)
$140.00
Debt(5):
5,448
Convertible(6):
2,154
NCI:
Enterprise
Value:
Volume (Millions)
9M
Q2 Earnings Announcement
(25% Drop in YoY Xyrem Sales)
Initiation of
Biologics License
Application for
JZP-458 (Rylaze)
8M
7M
6M
5M
0
$14,933
4M
$130.00
$120.00
Announcement
of GW Pharma
Acquisition
Positive TopLine Results
from Xywav
Phase 3 Study
Close of GW
Pharma
Acquisition
2M
1M
$110.00
$100.00
0M
31-Aug-20 06-Oct-20 10-Nov-20 16-Dec-20 25-Jan-21 02-Mar-21 07-Apr-21 12-May-21 17-Jun-21
Volume
Goldman Stanley
3M
23-Jul-21 31-Aug-21
Share Price
(1) Closing price as of 8/31/2021 per Capital IQ.
(2) Per Jaguar 2Q 2021 10-Q; dilution calculated with Treasury Stock Method.
(3) Per Jaguar 2Q 2021 10-Q.
(4) Per Jaguar 2020 10-K; adjusted based on Valuation Allowance / Gross Deferred Tax Asset.
(5) Based on fair values of Secured Notes, Dollar Term Loan, Euro Term Loan, and the Finance Leases.
(6) Based on fair values of all Convertible Bonds; assuming no conversion into shares.
6
Section 2
Review of Jaguar Management Forecasts
Goldman Stanley
7
Project Jaguar
REVIEW OF JAGUAR MANAGEMENT FORECASTS
Overview of Jaguar’s Product Pipeline
Approval Statuses Based on Latest Investor Presentation(1)
Product
JZP-458 (Rylaze)
Zepzelca (1L
SCLC)
Vyxeos (AML or
HR-MDS)
Pre-Clinical
Phase 1
Phase 2
Phase 3
Cannabinoids
Neuroscience
Approved
Included in
Valuation
FDA Approval on June 30, 2021
Phase 3 Trial Planned
Cooperative Group Study Planned
Epidiolex
(EMAS)
Phase 3 Trial Planned
JZP-385
(Tremor)
Phase 3 Trial Planned
JZP-150 (PTSD)
Phase 3 Trial Planned
JZP-324
(Oxybate)
JZP-341
(Hematological)
Goldman Stanley
Oncology
(1) Source: Management.
8
Project Jaguar
REVIEW OF JAGUAR MANAGEMENT FORECASTS
Preliminary Management Assumptions
Summary of Key Product Assumptions in Management Case(1)
($ as Stated Except Peak Sales Estimates in $ Billions or $ Millions)
Product:
Xyrem
Xywav
Epidiolex
Rylaze
Sunosi
Zepzelca
JZP-385
JZP-150
Patient
Population:
165K –
175K
165K –
175K
95K – 100K
~6K new
cases / year
165K –
175K
25K – 30K
new / year
~7 million
~2 million
Peak
Penetration
Rate:
6.3% (FY 21)
6.5% (FY 25)
55% (FY 27)
10% (FY 24)
25% (FY 25)
40% (FY 25)
8% (FY 27)
35% (FY 28)
Generics
Entrance:
FY 25
FY 28
N/A
N/A
N/A
N/A
N/A
N/A
Average
Price per
Patient:
$130K –
$160K
$110K –
$125K
$35K –
$55K
$400K+
$8K – $12K
$55K –
$67K
$1K – $2K
$1K – $2K
Pre-Generic
Price
Increases:
~6%
~2%
~5%
~1%
~9%
~2%
~3%
~3%
Peak Sales
(Projected):
$1.4 billion
$1.3 billion
$2.5 billion
$245
million
$509
million
$687
million
$796
million
$993
million
Goldman Stanley
(1) Per management estimates from 8/3 meeting.
9
Project Jaguar
REVIEW OF JAGUAR MANAGEMENT FORECASTS
Summary of Operational Forecasts
Per Jaguar Management; See Appendix A for Additional Details
Comparison of Product Peak Sales and Operational KPIs
Management Forecast(1)
Consensus Forecast(2)
Downside Case(3)
Xywav Peak Sales
 $1.3 billion in FY 25
 $1.0 billion in FY 25
 $0.7 billion in FY 25
Epidiolex Peak Sales
 $2.5 billion in FY 27
 $1.8 billion in FY 27
 $1.3 billion in FY 27
Zepzelca Peak Sales
 $0.7 billion in FY 25
 $0.5 billion in FY 25
 $0.3 billion in FY 25
Risk-Adjusted
Pipeline Peak Sales
 $0.5 billion in FY 30
 $0.3 billion in FY 30
 $0.2 billion in FY 30
FY 30 Revenue
(CAGR)
 $4.6 billion (7%)
 $3.8 billion (5%)
 $3.1 billion (3%)
EBITDA Margins
 44% falling to 39%
 44% falling to 39%
 44% falling to 39%
Goldman Stanley
(1) Per management estimates from 8/3 meeting.
(2) Based on Capital IQ median forecasts as of 8/31/2021.
(3) Based on low end of market size and share estimates from press releases.
10
Project Jaguar
REVIEW OF JAGUAR MANAGEMENT FORECASTS
Revenue Projections
Comparison of 10-Year Revenue Forecasts
Peak Sales by Product:
Includes Risk-Adjusted Revenue from Pipeline Drugs (JZP-385 and JZP-150)
(Management Case)
Product
Year
Sales
Xyrem
FY 21
$1.4 B
Total Sales ($ USD in Billions)
CAGR
$7.0 B
$6.2 B
Xywav
FY 25
$1.3 B
$6.0 B
Epidiolex
FY 27
$2.5 B
$5.0 B
Rylaze
FY 26
$0.2 B
Sunosi
FY 25
$0.5 B
FY 25
$0.7 B
Other
FY 30
$0.7 B
JZP-385
FY 30
$0.2 B
JZP-150
FY 30
$0.3 B
$5.5 B
$5.1 B
$4.8 B
$4.1 B
$4.4 B
$4.0 B
$3.3 B
$3.0 B
Zepzelca
$5.5 B
$5.8 B
$3.3 B
$3.2 B
$3.9 B
$3.9 B
$3.7 B
$4.5 B
$4.6 B
$3.7 B
$3.7 B
$4.8 B
$4.6 B
$4.8 B
$3.9 B
$3.4 B
$3.0 B
$4.1 B
$4.5 B
7%
$3.9 B
$3.8 B
$3.2 B
$3.2 B
$3.1 B
5%
$3.7 B
3%
$3.0 B
FY28
FY29
FY30
FY31
$2.0 B
$1.0 B
$0.0 B
FY21
FY22
FY23
FY24
Management
Goldman Stanley
FY25
FY26
Consensus
FY27
Downside
11
Project Jaguar
REVIEW OF JAGUAR MANAGEMENT FORECASTS
EBITDA Projections
Comparison of 10-Year EBITDA Forecasts
Key Assumptions:
Includes Risk-Adjusted EBITDA from Pipeline Drugs (JZP-385 and JZP-150)
(Management Case)
Driver
Gross
Margin
%
91%
Total EBITDA ($ USD in Billions)
CAGR
$3.0 B
$2.5 B
Op. Margin
27%  18%
Terminal
34%
EBITDA
Margin
$2.5 B
$2.0 B
$2.0 B
$1.9 B
$1.8 B
$1.9 B
44%  39%
39%
CapEx %
Revenue
1%
$1.0 B
Intangible
Purchases %
Revenue
5%
$0.5 B
Change in
WC %
Change in
Revenue
(17%)
Goldman Stanley
$2.3 B
$2.4 B
$2.1 B
$1.5 B
Terminal
$2.4 B
$1.5 B
$1.7 B
$1.4 B
$1.6 B
$1.9 B
$1.9 B
$1.6 B
$1.6 B
$1.7 B
$2.0 B
$1.6 B
$1.5 B
$1.4 B
$1.6 B
$1.8 B
$1.7 B
5%
$1.5 B
$1.5 B
$1.3 B
$1.3 B
$1.2 B
3%
$1.4 B
2%
$1.2 B
FY28
FY29
FY30
FY31
$1.3 B
$0.0 B
FY21
FY22
FY23
FY24
Management
FY25
FY26
Consensus
FY27
Downside
12
Project Jaguar
REVIEW OF JAGUAR MANAGEMENT FORECASTS
Historical and Projected Net Sales by Product
Management Case Forecasts(1)
($ USD in Billions; Pipeline Drug Sales Have Been Probability-Adjusted)
$7 B
$6 B
$5 B
JZP-150
JZP-385
Other Drugs
$4 B
Zepzelca
Sunosi
Rylaze
$3 B
Epidiolex/Epidyolex
Xywav
Xyrem
$2 B
$1 B
$0 B
FY21
Goldman Stanley
FY22
FY23
FY24
(1) Per management estimates from 8/3 meeting.
FY25
FY26
FY27
FY28
FY29
FY30
13
Project Jaguar
REVIEW OF JAGUAR MANAGEMENT FORECASTS
Jaguar Forecast Summary
Net Sales by Product (Risk-Adjusted Pipeline Sales)
Peak Sales Assumptions:
Management Forecast(1)
($ in Billions)
$7 B
Product
Mgmt
Base
Xywav
$1.3
$1.0
Epidiolex
$2.5
$1.8
Zepzelca
$0.7
$0.5
$6.2 B
$6 B
$5.5 B$5.5 B$5.8 B
$5.1 B
$4.8 B
$5 B
$4.8 B$4.6 B
$4.1 B
$4 B
$3.3 B
$3 B
$6 B
$4.8 B
$4.5 B$4.6 B
$4.4 B
$4.1 B$3.9 B
$3.9
B
$3.9 B
$4 B
$3.8 B
$3.3 B
$3 B
$5 B
$2 B
$1 B
$1 B
$0 B
FY21 FY22 FY23 FY24 FY25 FY26 FY27 FY28 FY29 FY30
Mgmt
$7 B
$2 B
$0 B
Product
Consensus Forecast(2)
FY21 FY22 FY23 FY24 FY25 FY26 FY27 FY28 FY29 FY30
Down
Downside Case(3)
Xywav
$1.3
$0.7
$7 B
Epidiolex
$2.5
$1.3
Zepzelca
$0.7
$0.3
$6 B
$5 B
$4 B
$3 B
$3.7 B
$3.7 B$3.7 B$3.9 B
$3.4 B
$3.2 B$3.2 B$3.1 B
$3.2 B
$3.0 B
$2 B
Pipeline & Other
Epidiolex
Xywav
Xyrem
Goldman Stanley
$1 B
$0 B
FY21 FY22 FY23 FY24 FY25 FY26 FY27 FY28 FY29 FY30
(1) Per management estimates from 8/3 meeting.
(2) Based on Capital IQ median forecasts as of 8/31/2021.
(3) Based on low end of market size and share estimates from
press releases.
14
Section 3
Jaguar Valuation
Goldman Stanley
15
Project Jaguar
JAGUAR VALUATION
Overview of Selected Valuation Methodologies
Description of Considered and Applied Methodologies
Category
Methodology
Description
Comparable Public
Companies
 Values Jaguar based on comparable, publicly traded specialty
biopharma companies
 Applies comparable companies’ forward multiples of
Revenue, EBITDA, and Net Income to company forecasts
Precedent
Transactions
 Values Jaguar based on multiples paid for previously acquired
biopharma companies
 Applies historical multiples of Revenue and EBITDA to
company forecasts
Transaction
Premiums
 Applies 1-day, 1-week, and 1-month premiums paid for
biopharma targets to Jaguar’s applicable share price
Sum-of-the-Parts DCF
Analysis
 DCF analysis of each product’s expected future cash flows,
with product-specific COGS and SG&A expenses
 Risk-adjusts pipeline sales and attributes minimal Terminal
Value to branded products due to risk from generics
“Going Concern” DCF
Analysis
 Values the company as a whole on a going-concern basis
 Cash flows are based on revenue from current and pipeline
products, with expenses linked to total revenue
 Risk-adjusts pipeline sales and attributes substantial Terminal
Value to Jaguar
A
Trading Valuation
B
M&A Valuation
C
D
Intrinsic Valuation
E
F
Reference Valuation
Goldman Stanley
G
Historical Trading
History
 Analyzes movements in Jaguar’s historical stock price and
evaluates its trading history
Research Analyst
Price Targets
 Reviews recent stock price targets from equity research
analysts, generally based on forward multiples
Used in Valuation
16
Project Jaguar
JAGUAR VALUATION
Preliminary Valuation Summary
Based on Management, Consensus, and Downside Forecasts(1)(2)
A
Trading Valuation
Approach
Precedent
Transactions
M&A Valuation
B
Intrinsic Valuation
C
E
Public
Comps
(Consensus
Forecasts
Assumed)
Transaction
Premiums
Metric
Range
CY 23 TEV /
Revenue
3.5x – 5.1x
CY 23 TEV /
EBITDA
11.1x –
19.1x
CY 23 P / E
13.8x –
22.3x
LTM TEV /
Revenue
5.7x –
10.2x
LTM TEV /
EBITDA
11.8x –
29.8x
1-Day
Premiums
37.3% –
54.1%
1-Week
Premiums
39.9% –
60.5%
1-Month
Premiums
35.5% –
69.1%
Indicative Share Price (25th to 75th Percentile)
$137.35
$245.07
Current Share Price:
$131.71
$226.44
$171.46
$272.25
$133.36
$309.45
$96.39
$389.05
$180.86
Consensus
Forecast
$209.31
$223.93
6.5% –
7.5% Initial
WACC
$159.38
Downside
Case
$108.47
$0.00
Goldman Stanley
$202.97
$199.92
Mgmt.
Forecast
“Going
Concern”
DCF Analysis
$454.39
$50.00
$100.00
$229.34
$261.25
$250.19
$178.61
$123.59
$150.00
$200.00
$250.00
(1) Market data based on closing prices as of 8/31/2021.
(2) Management based on 8/3 meeting data; Consensus based on Capital IQ forecasts as of
8/31/2021; Downside based on low end of market share/size estimates.
$300.00
$350.00
$400.00
$450.00
$500.00
17
Project Jaguar
JAGUAR VALUATION
Peer Benchmarking Analysis
U.S.-Based Specialty Pharma Companies with LTM Revenue Between $1 and $5 Billion
Jaguar’s unique financial
profile (similar growth to
its peer specialty
pharmaceutical
companies, but with
greater scale) should drive
a premium valuation.
Even in the Downside
Case, with significantly
lower projected Revenue
and EBITDA, Jaguar still
exceeds the scale all but
two peer companies by CY
23.
Additionally, Jaguar’s
Revenue is more closely
linked to existing products
and, therefore, may be
even higher on a
probability-adjusted basis.
($ USD in Billions)
Annual Revenue Projections, CY 22 – CY 23(1)
$6.0 B
$5.1 B
$5.0 B
$4.0 B
$4.0 B
$2.7 B
$3.0 B
$2.0 B
$1.7 B
$4.4 B
$3.2 B
$2.0 B $2.1 B
$1.3 B
$1.0 B
$0.0 B
NBIX
EBS
EXEL
UTHR BMRN SGEN
INCY Jaguar
JAZZ
CTLT
Annual EBITDA Projections, CY 22 – CY 23(1)
$2.5 B
$1.9 B
$2.0 B
$1.6 B
$1.5 B
$1.0 B
$1.4 B
$1.2 B
$0.9 B
$0.8 B
$0.3 B
$0.5 B
$0.5 B
$0.6 B
$0.0 B
NBIX
Goldman Stanley
EBS
EXEL
UTHR BMRN SGEN
INCY Jaguar
JAZZ
CTLT
(1) Consensus Forecast Revenue and EBITDA based on Capital IQ forecasts as of 8/31/2021.
18
Project Jaguar
JAGUAR VALUATION
Peer Companies – Multiples and Growth Rates
U.S.-Based Specialty Pharma Companies with LTM Revenue Between $1 and $5 Billion
Projected 2-Year Revenue CAGR, CY 22 – CY 23(1)
50.0%
Projected 2-Year EBITDA CAGR, CY 22 – CY 23(1)
45.9%
40.0%
100.0%
78.1%
80.0%
30.0%
20.0%
9.7%
10.0%
12.9%
0.0%
15.3%
21.8%
18.7% 20.0%
60.0%
22.6%
33.0%
40.0%
NM
0.0%
NM
Jaguar
(20.0%)
(40.0%) (27.5%)
(20.0%) (14.9%)
CY 23 TEV / Revenue Multiples(1)
10.0 x
9.0 x
8.0 x
7.0 x
6.0 x
5.0 x
4.0 x
3.0 x
2.0 x
1.0 x
0.0 x
15.3%
14.8%
20.0%
Jag
uar
(10.0%)
65.3%
55.4%
CY 23 TEV / EBITDA Multiples(1)
9.1 x
5.6 x
4.9 x
3.0 x
3.7 x 3.4 x 3.7 x
2.3 x
5.0 x
50.0 x
45.0 x
40.0 x
35.0 x
30.0 x
25.0 x
20.0 x
15.0 x
10.0 x
5.0 x
0.0 x
45.2x
11.9x
Jaguar
Goldman Stanley
18.1x
17.7x
6.3x
7.8x
9.1x
9.4x
11.1x
Jaguar
(1) Market data based on closing prices as of 8/31/2021.
(2) All forecasts use Consensus numbers based on Capital IQ data as of 8/31/2021.
19
Project Jaguar
JAGUAR VALUATION
Analysis of Precedent Transactions
LTM EBITDA Multiples Based on Biopharma M&A Targets with Over $500 Million in LTM
Revenue Since 8/31/2011(1)
60.0 x
50.0 x
40.0 x
Summary Statistics
Max
52.9 x
75th Percentile
29.8 x
Median
16.4 x
25th Percentile
11.8 x
Min
10.3 x
52.9 x
46.6 x
30.7 x
29.5 x
30.0 x
23.2 x
20.0 x
16.7 x
Median: 16.4 x 16.0 x
13.1 x
10.7 x
10.5 x
10.3 x
12.2 x
10.0 x
0.0 x
Target:
Acquirer:
Date:
Dec ‘20
Jan ‘18
Jan ‘16
Nov ‘14
Apr ‘17
Dec ‘16
Aug ‘16
Dec ‘14
Apr ‘14
Feb ‘14
Jan ‘14
Sep ’12
TEV:
$40.0 B
$11.0 B
$32.5 B
$68.7 B
$4.8 B
$5.5 B
$14.0 B
$9.5 B
$5.3 B
$22.1 B
$2.9 B
$2.3 B
Goldman Stanley
(1) Source: Capital IQ, SEC filings, press releases, and news articles.
20
Project Jaguar
JAGUAR VALUATION
Premiums Paid Analysis
Review of Premiums Paid for U.S.-Based Biopharma Sellers Since 8/31/2011(1)
Goldman Stanley reviewed
a list of 100 transactions
involving U.S.-based
biotechnology and
pharmaceutical sellers
over the past 10 years and
narrowed the list to
companies with over $500
million in LTM revenue.
Premium to Jaguar’s Closing Price on Applicable Dates and Implied Equity Value per Share
80.0%
69.1%
70.0%
60.5%
60.0%
54.1%
48.9%
50.0%
Early-stage acquisitions
were excluded from the
set because their cash
flow profiles, risk, and
valuation multiples are not
comparable to Jaguar’s
existing, profitable
business model in proven
markets.
40.0%
39.9%
37.3%
35.5%
30.0%
20.0%
10.0%
0.0%
1-Day Prior
Implied Price:
$181
$190
1-Week Prior
$203
25th Percentile
Goldman Stanley
47.9%
43.9%
(1) Source: Capital IQ data.
$200
$213
$229
Median
1-Month Prior
$209
$228
$261
75th Percentile
21
Project Jaguar
JAGUAR VALUATION
Discounted Cash Flow Analysis – Jaguar
Unlevered Free Cash Flow Projections Based on Consensus Forecast Figures(1)
Discounted Cash Flow
Analysis uses the
following assumptions:
 Valuation date of
8/31/2021
 Initial WACC of 7.0%
declining to 5.4% by
Year 10
 15% book tax rate and
20-30% cash tax rate
due to SBC and
intangible amortization
 Mid-year convention
and stub period used
for Q3 – Q4 of FY 21
 Assumes close of $6.2
billion GW acquisition
in Q2 of FY 21
Goldman Stanley
($ USD in Millions Except for Per Share Data)
Enterprise Value Sensitivity Analysis(1):
Implied Share Price Sensitivity Analysis (1):
($ in Millions)
($ in Millions)
(1) Management based on 8/3 meeting data; Consensus based on Capital IQ forecasts as of 8/31/2021; Downside based on low end of market
share/size estimates.
22
Project Jaguar
JAGUAR VALUATION
Jaguar DCF – Sensitivity Analysis
Variance to Implied Share Price in DCF Based on Consensus Forecasts(1)
Sensitivity
Implied Share Price
Comments
 Current: $110K per patient per year starting
in FY 21
Xywav – Initial
Price per Patient
$163.99
$173.26
 Sensitivity: $85K – $135K per year starting
price
 Current: FY 28 assumed (~80% price drop)
Xywav Generics
Entrance Year
$163.40
$176.21
 Sensitivity: FY 24 through FY 30 entrance
years
 Current: 20% rising to a 40% peak market
penetration in FY 27 and then declining
Epidiolex Market
Penetration
$141.98
$195.27
 Sensitivity: +/- 25% market penetration
(e.g., 50% rather than 40% at the peak)
 Current: 5% annual from FY 21 onward
Epidiolex Annual
Price Increases
$134.13
Pipeline Drug
Risk Adjustment
Factor
$219.39
$154.71
 Sensitivity: 0% to 10% annual price
increases through FY 30
 Current: 26.5% based on Phase 2 and 3
clinical trial success probabilities
$182.54
 Sensitivity: 1.5% through 51.5% reduction
in pipeline drug revenue
$100.00
Goldman Stanley
$120.00
$140.00
$160.00
$180.00
$200.00
$220.00
$240.00
(1) Consensus based on Capital IQ forecasts as of 8/31/2021; product assumptions based on press releases and industry research.
23
Project Jaguar
JAGUAR VALUATION
Jaguar – WACC Analysis
Based on Jaguar’s Historical Beta and Capital Structure and Comparable Companies(1)
Goldman Stanley
reviewed Jaguar’s
historical data and
information from the
comparable companies:
 Given the wide
differences in capital
structures, it is crucial
to calculate WACC via
multiple methods
 The DCF assumes an
initial WACC of 7.0%
declining to 5.4% by
Year 10, based on
WACC figures in the
6.5% – 8.5% range for
Jaguar’s higher-growth
peers
 The final 5.4% rate in
the Terminal Period is
close to the average
WACC produced by the
three methods
described here
Goldman Stanley
($ USD in Billions)
WACC Calculation
Assumption
Notes
Low
Base
High
Equity Risk Premium
Duff & Phelps’ Valuation Handbook (2021)
5.5%
5.5%
5.5%
Risk-Free Rate
10-year U.S. Treasury Yield as of 8/31/2021
1.3%
1.3%
1.3%
Levered Beta
Jaguar historical Beta and re-levered Beta
from the comparable companies
0.78
0.97
1.35
Cost of Equity (Ke)
Based on Capital Asset Pricing Model (CAPM)
5.6%
6.6%
8.7%
Equity / Total Capitalization
Current capital structure and optimal capital
structure from comps’ median
96.6%
52.2%
52.2%
Pre-Tax Cost of Debt
Weighted YTM of Jaguar’s current Debt,
including Convertible Bonds
3.1%
3.1%
3.1%
Tax Rate (T)
U.S. corporate tax rate + international
benefits
15.0%
15.0%
15.0%
2.6%
2.6%
2.6%
After-Tax Cost of Debt (Kd)
Total Debt (D)
Current balance or comparables’ median
Debt percentage
$0.5 B
$7.6 B
$7.6 B
Total Capitalization
Jaguar current Debt + Equity Value
$15.9 B
$15.9 B
$15.9 B
Debt / Total Capitalization
Current capital structure and optimal capital
structure from comps’ median
3.4%
47.8%
47.8%
WACC
Ke * E / (D + E) + Kd * (1 – T) * D / (D + E)
4.7%
5.5%
5.8%
(1) Market data based on closing prices as of 8/31/2021.
24
Project Jaguar
JAGUAR VALUATION
Overview of the Company’s Top 20 Shareholders
Ownership is Diverse and Primarily Large-Cap Institutional Asset Managers
#
Shareholder
Ownership Stake and Cumulative Holdings
Shares (000’s)(1)
Current Market Value ($ M)(1)
1
BlackRock, Inc.
10.2%
6,163
$812
2
The Vanguard Group, Inc.
9.0% 19.2%
5,483
$722
3
FMR LLC
5.6%
3,370
$444
4
J.P. Morgan Asset Management, Inc.
4.4%
2,681
$353
5
State Street Global Advisors, Inc.
4.0%
2,399
$316
6
Renaissance Technologies Corp.
3.8%
2,317
$305
7
LSV Asset Management
3.3%
40.2%
1,976
$260
8
Wellington Management Group LLP
2.8%
43.0%
1,681
$221
9
Polaris Capital Management, LLC
2.1%
45.1%
1,293
$170
10
Mulligan, Seamus C. (Independent Director)
1.9%
47.0%
1,155
$152
11
Geode Capital Management, LLC
1.6%
48.6%
999
$132
12
Citadel Advisors LLC
1.6%
50.2%
962
$127
13
AQR Capital Management, LLC
1.6%
51.8%
954
$126
14
Dimensional Fund Advisors L.P.
1.5%
53.3%
894
$118
15
Redmile Group, LLC
1.4%
54.7%
860
$113
16
Janus Henderson Group plc (NYSE:JHG)
1.4%
56.1%
830
$109
17
Victory Capital Management Inc.
1.2%
57.3%
732
$96
18
Teachers Insurance and Annuity Association of America
1.2%
58.4%
711
$94
19
Franklin Resources, Inc.
1.1%
59.6%
684
$90
20
BNY Mellon Asset Management
1.0%
60.6%
618
$81
Goldman Stanley
24.7%
29.2%
33.1%
36.9%
(1) Share counts based on June 30, 2021 10-Q filing. Market data based on closing prices as of 8/31/2021.
25
Project Jaguar
JAGUAR VALUATION
Valuation Conclusions
A 30 – 50% Premium ($170 – $200) is Possible with the Right Process
Jaguar Could Maximize Shareholder Value via a Broad Process Including Tier 1 and Tier 2 Partners
Management Case
Valuation is Justified
Jaguar’s margins exceed those of its peer companies and its revenue growth rates are in-line with
theirs, but it trades at a 20% – 60% discount following its Q2 earnings announcement
#2
Goal: $200 / Share
This level represents a 50%+ premium to Jaguar’s current share price; the valuation methodologies
point to a range of $170 – $200, but a deal at $170 makes little sense given the past 12 months’
trading history
#3
Discounted Cash
Flow (DCF) Analysis
The implied value is between $170 and $230 per share, but these projections do not include possible
synergies in an M&A deal, so they may understate Jaguar’s value to potential partners
#4
Premiums Paid
Analysis
#1
Goldman Stanley
Premiums Paid indicate a median implied share price in the $190 – $230 range, depending on the
time period and adjustments (i.e., undisturbed vs. raw share prices)
26
Section 4
Potential Strategic Alternatives
Goldman Stanley
27
Project Jaguar
POTENTIAL STRATEGIC ALTERNATIVES
Potential Alternatives for Jaguar
Both Standalone and Strategic Options Should Be Considered
 Multiple potential paths
forward exist for Jaguar
 Many paths are not
mutually exclusive (i.e.,
the company could
pursue several at the
same time)
 Given current market
conditions and the
company’s capital
structure, M&A options
are more likely to
maximize shareholder
value
1
Organic
Continue Expansion,
Development, and
Licensing Efforts
2
Standalone
Issue Equity
Capital Structure
3
Issue Debt
4
Tuck-In Acquisition
Acquisition
5
Transformational
Acquisition
Strategic
6
Sale / Merger
Goldman Stanley
Merger / Combination
with Strategic
28
Project Jaguar
POTENTIAL STRATEGIC ALTERNATIVES
Assessment of Standalone / Strategic Alternatives
Key Considerations Should Be Process Speed, Valuation, and Market Conditions
1
Status Quo
2
Issue Equity
3
Issue Debt
4
Tuck-In Acquisition
5
Transformational
Acquisition
6
Sale to a Strategic
Goldman Stanley
Description
Benefits
Considerations
 Continue geographic expansion into
Europe and Asia-Pac and internal
development efforts
 No additional headcount required
 Leverages existing customer and
distributor relationships
 Enhances future growth prospects
 Internal development is expensive
and increasingly risky
 Difficult to find solid IPs to license
 Complete a follow-on equity
offering at a modest (~5%) discount
to raise additional capital
 Quick completion time (weeks)
 No additional interest expense or
covenants
 Jaguar is currently trading near its
12-month low price
 Significant shareholder dilution
 Issue traditional debt (senior notes)
or another convertible bond
 Lowest-cost form of financing
 Lenders are already familiar with
Jaguar’s name and credit profile
 Jaguar has 52% Debt in its capital
structure, far above any public peer
 Covenants may restrain M&A
activity
 Complete a < $500 million
acquisition of a pre-revenue
company
 Jaguar could gain promising pipeline
drug candidates
 Enhances growth profile
 Difficult to find good targets in this
size range
 May distract management
 Complete a larger (> $5 billion)
acquisition of a company with
substantial revenue
 The right deal could dramatically
increase Jaguar’s valuation
 Enhances growth and market access
 Jaguar just completed a $6 B deal
 A major would result in significant
shareholder dilution
 Merge with a peer company or sell
to a larger multinational strategic
acquirer
 Likely the optimal path to maximize
shareholder value in the short term
 Critical mass, synergies, and access
 Relatively few qualified partners
with capacity
 Management bandwidth constraints
29
Project Jaguar
POTENTIAL STRATEGIC ALTERNATIVES
Criteria for Potential Strategic Partners
Goldman Stanley Considered a Broad Range of Potential Biopharma Partners
Size, Ability to Pay, Product Pipeline, and Strategic Fit Should All Be Considered
Key Criteria
 At $200 / share, Jaguar would be worth an Enterprise Value of over $18 billion; potential partners
should be able to use $18 billion in combined Cash and Debt to fund a potential deal
 Both branded and generics companies should be considered, given recent M&A activity
Tier 1 Potential Partners
Tier 2 Potential Partners
Market Cap
 Significantly larger than Jaguar
 Closer to Jaguar’s size
Ability to Pay
 Capable of paying at least $1820 billion in Cash and Debt
 May have to issue Stock to
fund the full purchase price
Strategic Fit
 Solid product and pipeline fit
 Solid product and pipeline fit
Goldman Stanley
30
Project Jaguar
POTENTIAL STRATEGIC ALTERNATIVES
Tier 1 and Tier 2 Potential Strategic Partners
Summary of Partners by Viability and Geography
Tier 1 Potential Partners
Tier 2 Potential Partners
North America
International
Goldman Stanley
31
Project Jaguar
POTENTIAL STRATEGIC ALTERNATIVES
Overview of Tier 1 Potential Partners
Goldman Stanley Conducted an Initial Evaluation of Each Partner
($ USD in Billions)
Potential
Partner
Market Cap(1) Debt & NCI(1)
Cash(1)
Enterprise
Value(1)
Leverage
Ratio(1)
Strategic Fit
Ability to Pay
Comments
$128.1
$32.8
$8.1
$152.8
2.6x
 Primarily smaller (< $5B) deals, with
some exceptions (Otezla)
$148.6
$46.3
$14.0
$180.8
2.4x
 MyoKardia and Celgene represent
larger transactions
$91.3
$30.2
$6.8
$114.6
2.1x
 Acquired Immunomedics for $20B in
2020
$455.8
$33.5
$26.9
$462.3
1.1x
 Last large deal was Actelion ($29B) in
2017
$193.1
$26.5
$8.6
$211.1
1.7x
 Has not completed a > $10B
acquisition in the past ~7 years
$206.6
$35.9
$5.3
$237.3
2.1x
 Acquired The Medicines Company
for $10B in 2019
$229.2
$2.2
$4.3
$227.0
0.2x
 Has completed primarily smaller
deals ($1 – 2B) in the past
$258.3
$39.5
$21.7
$276.1
2.0x
 Acquired Array BioPharma for $12B
in 2019
$314.3
$20.7
$6.6
$328.4
0.8x
 Primarily smaller (< $5B) deals
$129.8
$25.8
$11.5
$144.1
2.0x
 Acquired Bioverativ for $12B in 2018
Goldman Stanley
(1) Financial data as of August 31, 2021.
32
Project Jaguar
POTENTIAL STRATEGIC ALTERNATIVES
Company Profile: Amgen
($ USD in Billions)
Business Description
Amgen Inc. discovers, develops, manufactures, and delivers human
therapeutics worldwide. It focuses on inflammation, oncology/hematology,
bone health, cardiovascular disease, nephrology, and neuroscience areas.
Amgen
Headquarters:
Employees:
Founded:
California
24,200
1980
Financial Information(1)
Market Cap:
Enterprise Value:
LTM Revenue:
LTM EBITDA:
TEV / Revenue:
TEV / EBITDA:
$128.1
$152.8
$25.5
$12.6
6.0x
12.2x
One-Year Price History(1)
Goldman Stanley
Amgen Inc. serves healthcare providers, including physicians or their clinics,
dialysis centers, hospitals, and pharmacies. It distributes its products through
pharmaceutical wholesale distributors, as well as direct-to-consumer channels.
Business Segments and Product Lines
 Enbrel – To treat plaque psoriasis, rheumatoid arthritis, and psoriatic
arthritis.
 Neulasta – Reduces the chance of infection due a low white blood cell count
in patients with cancer.
 Prolia – To treat postmenopausal women with osteoporosis.
 Xgeva – To prevent skeletal-related events.
 Otezla – To treat adult patients with plaque psoriasis, psoriatic arthritis, and
oral ulcers associated with Behçet’s disease.
 Aranesp – To treat a lower-than-normal number of red blood cells and
anemia.
 KYPROLIS – To treat patients with relapsed or refractory multiple myeloma.
 Repatha – To reduce the risks of myocardial infarction, stroke, and coronary
revascularization.
 Other Products – Nplate, Vectibix, MVASI, Parsabiv, EPOGEN, KANJINTI,
BLINCYTO, Aimovig, EVENITY, AMGEVITATM, Sensipar/Mimpara,
NEUPOGEN, IMLYGIC, Corlanor, and AVSOLA.
(1) Financial data as of August 31, 2021.
Management Team
Robert Bradway
Peter Griffith
Esteban Santos
Linda Louie
Mike Zahigian
Jonathan Graham
Nancy Grygiel
Chairman & CEO
EVP & CFO
EVP, Operations
VP, Finance & CAO
SVP & CIO
EVP & GC
SVP & CCO
Notable Acquisitions
Otezla Worldwide
Rights
$13.4 billion
Aug 2019
Onyx
Pharmaceuticals
$10.0 billion
Aug 2013
33
Project Jaguar
POTENTIAL STRATEGIC ALTERNATIVES
Company Profile: Bristol-Myers Squibb
($ USD in Billions)
Business Description
Bristol-Myers Squibb
Headquarters:
Employees:
Founded:
New York
32,200
1887
Financial Information(1)
Market Cap:
Enterprise Value:
LTM Revenue:
LTM EBITDA:
TEV / Revenue:
TEV / EBITDA:
$148.6
$46.3
$44.4
$19.0
4.1x
9.5x
One-Year Price History(1)
Goldman Stanley
Bristol-Myers Squibb Company discovers, develops, licenses, manufactures,
and markets biopharmaceutical products worldwide, including chemicallysynthesized drugs, small molecules, and biologics. It offers products for
hematology, oncology, cardiovascular, immunology, fibrotic, neuroscience, and
COVID-19.
Management Team
Giovanni Caforio, MD
David Elkins
Greg Meyers
Paul von Autenried
Christopher Boerner
CEO
EVP & CFO
EVP & CTO
EVP & CIO
EVP & CCO
It sells products to wholesalers, distributors, pharmacies, retailers, hospitals,
clinics, and government agencies. The company was formerly known as BristolMyers Company.
Business Segments and Product Lines
 Revlimid – An oral immunomodulatory drug for the treatment of multiple
myeloma.
 Eliquis – An oral inhibitor for reduction in risk of stroke/systemic embolism
in NVAF, and for the treatment of DVT/PE.
 Opdivo – Anti-cancer indications.
 Pomalyst/Imnovid – For patients with multiple myeloma.
 Orencia – For adult patients with active RA and psoriatic arthritis.
 Sprycel – For the treatment of Philadelphia chromosome-positive chronic
myeloid leukemia.
 Yervoy – For patients with unresectable or metastatic melanoma.
 Abraxane – Protein-bound chemotherapy product.
 Reblozyl – For anemia in adult patients with beta thalassemia.
 Empliciti – For the treatment of multiple myeloma.
 Other Products – Zeposia, Breyanzi, Inrebic, and Onureg.
(1) Financial data as of August 31, 2021.
Notable Acquisitions
MyoKardia
$13.1 billion
Oct 2020
Celgene
$99.6 billion
Jan 2019
34
Project Jaguar
POTENTIAL STRATEGIC ALTERNATIVES
Company Profile: Gilead Sciences
($ USD in Billions)
Gilead Sciences
Headquarters:
Employees:
Founded:
California
14,400
1987
Financial Information(1)
Market Cap:
Enterprise Value:
LTM Revenue:
LTM EBITDA:
TEV / Revenue:
TEV / EBITDA:
$91.3
$114.6
$26.6
$14.3
4.3x
8.0x
One-Year Price History(1)
Business Description
Management Team
Gilead Sciences, Inc., a biopharmaceutical company, discovers, develops, and
commercializes medicines in the areas of unmet medical need in the United
States, Europe, and internationally. It offers treatments for HIV/AIDS, liver
diseases, certain cancers, and cardiovascular diseases, and it offers products for
hematology, oncology, and cell therapy patients.
Daniel O’Day
Chairman & CEO
Andrew Dickinson
EVP & CFO
Stacey Ma
EVP, Development
Flavius Martin
EVP, Research
Johanna Mercier
CCO
Merdad Parsey, MD, PhD
CMO
Deborah Telman
EVP & GC
The company markets its products through its commercial teams and/or in
conjunction with third-party distributors and corporate partners.
Business Segments and Product Lines
 HIV/AIDS – Biktarvy, Genvoya, Descovy, Odefsey, Truvada, Complera/
Eviplera, Stribild, and Atripla.
 COVID-19 – Veklury (an injection for intravenous use).
 Liver Diseases – Epclusa, Harvoni, Vosevi, Vemlidy, and Viread.
 Hematology, Oncology, and Cell Therapy Patients – Epclusa, Harvoni,
Vosevi, Vemlidy, and Viread.
 Pulmonary Arterial Hypertension – Letairis (oral formulation for
treatment).
 Chronic Angina – Ranexa (oral formulation for treatment).
 Invasive Fungal Infections – AmBisome (liposomal formation for
treatment).
Notable Acquisitions
Immunomedics
$20.9 billion
Sep 2020
Kite Pharma
$11.3 billion
Aug 2017
Goldman Stanley
(1) Financial data as of August 31, 2021.
35
Project Jaguar
POTENTIAL STRATEGIC ALTERNATIVES
Company Profile: Merck & Co.
($ USD in Billions)
Merck & Co.
Headquarters:
Employees:
Founded:
New Jersey
67,500
1891
Financial Information(1)
Market Cap:
Enterprise Value:
LTM Revenue:
LTM EBITDA:
TEV / Revenue:
TEV / EBITDA:
$193.1
$211.1
$43.9
$15.4
4.8x
13.7x
One-Year Price History(1)
Goldman Stanley
Business Description
Management Team
Merck & Co., Inc. operates as a healthcare company worldwide. It operates
through two segments, Pharmaceutical and Animal Health, and offers products
in areas such as oncology, immunology, neuroscience, virology, cardiovascular,
pharmaceuticals, and vaccines.
Robert Davis
President & CEO
Caroline Litchfield
CFO
Sanat Chattopadhyay
EVP, Manufact.
Richard DeLuca
EVP, Animal Health
Dean Li, MD, PhD
EVP, Research
Cristal Downing
EVP & CCO
Chirfi Guindo
CMO
It serves drug wholesalers and retailers, hospitals, government agencies,
managed health care providers (including health maintenance organizations),
pharmacy benefit managers, physicians and physician distributors,
veterinarians, and animal producers.
Business Segments and Product Lines
 Keytruda – Anti-PD-1 monotherapy for the treatment of cervical cancer,
classic Hodgkin Lymphoma, and related melanomas and carcinomas,
including non-small-cell lung cancer (NSCLC).
 Gardasil/Gardasil 9 – Vaccines to help prevent certain diseases caused by
certain types of human papillomavirus.
 Januvia/Janumet – For the treatment of Type 2 diabetes.
 ProQuad/M-M-R II/Variva – Pediatric combination of the measles, mumps,
rubella, and varicella vaccines (and related viruses).
 Bridion – Injection for the reversal of two types of neuromuscular blocking
agents used during surgery.
 Livestock (Animal Health) – Various antibiotics and anti-inflammatory drugs
for use in cattle and swine.
 Companion Animals (Animal Health) – Various oral and topical parasitic
control products for dogs and cats.
(1) Financial data as of August 31, 2021.
Notable Acquisitions
VelosBio
$2.6 billion
Nov 2020
Cubist
Pharmaceuticals
$10.2 billion
Dec 2014
36
Project Jaguar
POTENTIAL STRATEGIC ALTERNATIVES
Company Profile: Pfizer
($ USD in Billions)
Business Description
Pfizer Inc. discovers, develops, manufactures, markets, distributes, and sells
biopharmaceutical products worldwide. It offers medicines and vaccines in
therapeutic areas, including cardiovascular metabolic and women’s health,
small molecules, injectable and anti-infective medicines, and chronic immune
and inflammatory diseases.
Pfizer
Headquarters:
Employees:
Founded:
New York
79,000
1849
Financial Information(1)
Market Cap:
Enterprise Value:
LTM Revenue:
LTM EBITDA:
TEV / Revenue:
TEV / EBITDA:
$258.3
$276.1
$55.1
$19.6
5.0x
14.1x
One-Year Price History(1)
Goldman Stanley
The company serves wholesalers, retailers, hospitals, clinics, government
agencies, pharmacies, and individual provider offices, as well as disease control
and prevention centers.
Business Segments and Product Lines
 Biopharmaceuticals – Comirnaty (COVID-19), Prevnar (pneumococcal
disease), and Nimenrix (meningococcal ACWY disease).
 Oncology – Ibrance (metastatic breast cancer), Xtandi (mCRPC, nmCRPC,
and mCSPC), Inlyta (advanced RCC), and Sutent (advanced or metastatic
RCC).
 Internal Medicine – Eliquis (atrial fibrillation, thrombosis, and pulmonary
embolism) and Premarin (menopause).
 Hospital – Sulperazon (bacterial infections), Medrol (anti-inflammatory),
and Zavicefta (bacterial infections).
 Inflammation & Immunology – Xeljanz (RA, PsA, UC, and active
polyarticular course juvenile idiopathic arthritis) and Enbrel (RA, juvenile
idiopathic arthritis, PsA, and plaque psoriasis).
 Rare Disease – Vyndaqel/Vyndamax (ATTR-cardiomyopathy and
polyneuropathy), BeneFIX (hemophilia B), and Genotropin (human growth
hormone replacement).
(1) Financial data as of August 31, 2021.
Management Team
Dr. Albert Bourla
David Denton
Mikael Dolsten
Lidia Fonseca
Angela Hwang
Rady Johnson
Douglas Lankler
Chairman & CEO
EVP & CFO
President, R&D
EVP & CTO
President, Biopharma
EVP & CCO
EVP & GC
Notable Acquisitions
Array BioPharma
$11.5 billion
Jun 2019
Medivation
$14.3 billion
Aug 2016
37
Project Jaguar
POTENTIAL STRATEGIC ALTERNATIVES
Company Profile: Roche
($ USD in Billions)
Roche
Headquarters:
Employees:
Founded:
Switzerland
100,920
1896
Financial Information(1)
Market Cap:
Enterprise Value:
LTM Revenue:
LTM EBITDA:
TEV / Revenue:
TEV / EBITDA:
$314.3
$328.4
$63.3
$25.2
5.2x
13.0x
One-Year Price History(1)
Goldman Stanley
Business Description
Management Team
Roche Holding AG engages in the pharmaceuticals and diagnostics businesses
in Europe and internationally. The company offers pharmaceutical products for
treating oncology, neuroscience, infectious, immunology, cardiovascular and
metabolism, ophthalmology, and respiratory, as well as anemia, cancer,
dermatology, hemophilia, inflammatory and autoimmune, neurological, and
transplantation.
Dr. Severin Schwain
Chairman & CEO
Dr. Alan Hippe
CFO & CIO
Bill Anderson
CEO, Pharmaceuticals
Dr. Thomas Schinecker
CEO, Diagn.
Dr. James Sabry
Head of Partnerships
Prof. Dr. Hans Clevers
R&D Head
Claudia Bockstiegel
GC
It also offers in-vitro tests for various diseases, such as cancer, diabetes, COVID19, hepatitis, and human papillomavirus.
Business Segments and Product Lines
 Ocrevus (Neuroscience) – Infusion treatment for relapsing and primary
progression forms of multiple sclerosis.
 Perjeta (Oncology) – Treatment for HER2-positive breast cancer.
 Actemra/RoActemra (Immunology) – Treatment for moderate-to-severe
rheumatoid arthritis and related arthritis diseases.
 Tecentriq (Oncology) – Cancer immunotherapy (alone or in combination)
for various types of cancer, such as lung, bladder, breast and liver cancer.
 Avastin (Oncology) – Tumor-starving therapy designed to work with
chemotherapy to prevent tumor growth.
 Hemlibra (Hemophilia) – Prophylactic treatment for hemophilia A with and
without factor VIII inhibitors.
 Herceptin (Oncology) – Treatment for early-stage HER2-positive breast
cancer, stomach cancer, and esophageal cancer.
 Kadcyla (Oncology) – Newer treatment for HER2-positive breast cancer.
(1) Financial data as of August 31, 2021.
Notable Acquisitions
Spark
Therapeutics
$4.9 billion
Feb 2019
Intermune
$8.9 billion
Aug 2014
38
Section 5
Process Recommendations
Goldman Stanley
39
Project Jaguar
PROCESS RECOMMENDATIONS
Key Recommendations
Comparison of Targeted and Broad Processes
Targeted Process
 We recommend
engaging in targeted
discussions with the
Tier 1 candidates
 At the same time,
Goldman Stanley will
reach out to Tier 2
candidates
 The M&A process with
Tier 1 candidates will
take significantly longer,
so we recommend
parallel processes
 Depending on the
responses from Tier 1
and Tier 2 candidates,
Goldman Stanley and
Jaguar may approach
additional partners
Goldman Stanley
Description
Benefits
Considerations
Broad Process
 Approach fewer than 5
potential partners
 Approach 10 – 100 potential
partners
 Goldman Stanley will create a
management presentation and
financial model
 Goldman Stanley will create a
management presentation,
financial model, and CIM
 On average, 6-12 months
required
 More likely to maximize
shareholder value
 Higher offer probability
 Less management bandwidth
 Goldman Stanley could also
approach financial sponsors
active in the healthcare space
 Less likely to maximize
shareholder value
 Highly variable timing due to
iterative process
 More intense management
focus required as discussions
with potential partners
accelerate
 More management bandwidth
required throughout the entire
process
40
Project Jaguar
PROCESS RECOMMENDATIONS
Process Alternatives
Comparison of Alternatives and Recommended Hybrid Process
Specialized
Negotiations With
One Party
Highly Targeted
Process
Targeted Discussions
+ Broader Search
Broad M&A
Process Broad
Marketing
RECOMMENDED
 Combination of targeted discussions plus
broader search conducted in background
maximizes success probability and
minimizes disruption to Jaguar
 Additional parties contacted depend on
responsiveness of Tier 1 and Tier 2
partners
 Interested parties would sign NDAs and
then proceed into due diligence and
valuation discussions with Jaguar
Goldman Stanley
41
Project Jaguar
PROCESS RECOMMENDATIONS
Process Roles and Responsibilities
Overview of Phases, Workflow, and Estimated Timing
Goldman Stanley
Organization
1
Phase I:
2 months

Deal Close
Negotiations
Marketing
2
Phase II:
4 – 6 weeks


Phase III:
2 months
4
Goldman Stanley


3
Phase IV:
4 – 6 weeks



Legal
Determine potential
partners
Finalize projections,
CIM, and mgm’t
presentation


Contact partners
and negotiate NDAs
Schedule
management
meetings

Conduct meetings
and solicit bids
Discuss synergies
and facilitate
diligence

Review bids from
potential partners
Negotiate terms of
DA with top
partners


Management
Review draft DA
Identify legal
issues/concerns

Assist in NDA
negotiations
Assist in compiling
legal diligence items

Review initial bids
and follow-up
diligence lists for
legal items





Review bids,
negotiate terms of
DA, and assist with
confirmatory
diligence


Board
Determine potential
partners
Finalize projections,
CIM, and mgm’t
presentation

Prepare for
management
meetings
Contact additional
potential partners

Formulate synergies
Attend
management
meetings
Answer diligence
requests

Review bids and
assist with diligence
Discuss contracts




Determine process
and objectives
Approve Tier 1 and
Tier 2 partners to
approach
Receive process
updates
Provide
input/direction if
required
Receive process
updates
Provide
input/direction if
required
Review bids and
approve agreement,
if appropriate
42
Project Jaguar
PROCESS RECOMMENDATIONS
Illustrative Process Timeline
A Targeted Process + Broader Search Could Be Completed in ~6 Months
September
October
November
December
January
February
March
Date
1
8
15
22
29
6
13
20
27
3
10
17
24
1
8
15
22
29
5
12
19
26
2
9
16
23
2
9
Week
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Execution
Preparation
1
2
3
4
Phase I: Organization
(2 months)
Phase II: Marketing
(4-6 weeks)
Phase III: Negotiations
(2 months)
 GS / Company to draft management
presentation and refine detailed
financial model
 GS to reach out with
script to potential buyers
(no teaser required for
public company)
 Solicit initial bids with management
and legal team and respond to followup diligence requests
 Finalize list of potential partners and
script / messaging with management
 Select group of parties
enter into NDA and
receive management
presentation and financial
model
 Access to full data room for legal
purposes
 Length of round depends on proposals
received and additional diligence
requests
Phase IV: Deal Close
(4-6 weeks)
 Review bids with
management and legal
 Negotiate terms of DA
with top potential
partners
 Approve agreement and
announce transaction
Goldman Stanley
Potential Outcomes
After Round 1
Indications of Value
1.
Offer at Attractive Level: Negotiate for best outcome.
2.
Offer(s) at Suboptimal Prices: Begin broader process and start
outreach to Tier 2 potential partners.
3.
No Attractive Bids: Focus on execution and financing of longterm operational plan.
43
Appendix A
Financial Projection Assumptions
Goldman Stanley
44
Project Jaguar
FINANCIAL PROJECTION ASSUMPTIONS
Summary of Revenue Forecasts by Scenario
Comparison of Management, Consensus, and Downside Cases(1)
($ USD in Millions)
Revenue by Segment by Scenario:
Management
Existing and Acquired Products:
Xyrem
Xywav
Epidiolex/Epidyolex
Rylaze
Sunosi
Zepzelca
Other Drugs
Risk-Adjusted Pipeline Drug Sales:
JZP-385
JZP-150
Total Revenue:
Revenue Growth:
Consensus
Existing and Acquired Products:
Xyrem
Xywav
Epidiolex/Epidyolex
Rylaze
Sunosi
Zepzelca
Other Drugs
Risk-Adjusted Pipeline Drug Sales:
JZP-385
JZP-150
Total Revenue:
Revenue Growth:
Downside
Existing and Acquired Products:
Xyrem
Xywav
Epidiolex/Epidyolex
Rylaze
Sunosi
Zepzelca
Other Drugs
Risk-Adjusted Pipeline Drug Sales:
JZP-385
JZP-150
Total Revenue:
Revenue Growth:
Goldman Stanley
Units:
$M
$M
$M
$M
$M
$M
$M
$
$M
$M
$M
%
$M
$M
$M
$M
$M
$M
$M
$
$M
$M
$M
%
$M
$M
$M
$M
$M
$M
$M
$M
$M
$M
%
$
FY21
FY22
FY23
FY24
Projected
FY25
FY26
FY27
FY28
FY29
FY30
1,363.4 $
456.9
684.2
12.0
70.6
223.0
512.2
1,268.0 $
654.6
1,031.4
144.7
158.6
335.6
537.8
1,178.9 $
860.9
1,269.8
218.2
264.3
442.5
564.7
1,046.6 $
1,076.1
1,531.4
243.6
387.9
569.1
587.3
157.8 $
1,300.1
1,818.0
244.8
508.5
687.1
610.8
108.9 $
1,287.9
2,131.6
245.4
470.2
650.0
629.1
112.7 $
1,274.1
2,474.3
245.7
431.4
613.0
648.0
116.7 $
247.7
2,373.7
233.7
392.3
576.3
661.0
120.8 $
123.2
2,254.3
221.7
373.5
548.1
674.2
125.0
121.9
2,114.6
209.6
354.5
520.1
687.7
3,322.4
40.6%
4,130.8
24.3%
20.8
4,820.1
16.7%
65.4
18.7
5,526.0
14.6%
114.4
45.7
5,487.1
(0.7%)
167.6
82.0
5,772.6
5.2%
200.2
178.5
6,178.0
7.0%
209.0
260.8
5,071.0
(17.9%)
210.0
262.1
4,787.9
(5.6%)
211.1
263.4
4,607.9
(3.8%)
1,363.4 $
456.9
651.6
12.0
70.6
214.8
512.2
1,268.0 $
617.2
859.5
144.7
158.6
285.2
537.8
1,178.9 $
765.3
1,015.9
218.2
264.3
357.4
564.7
197.5 $
880.4
1,186.8
243.6
387.9
431.1
587.3
153.3 $
1,000.1
1,373.6
244.8
508.5
515.3
610.8
105.8 $
960.8
1,577.4
245.4
470.2
487.5
629.1
109.5 $
939.9
1,799.5
245.7
431.4
459.8
648.0
113.4 $
180.5
1,756.5
233.7
392.3
432.2
661.0
117.3 $
88.6
1,703.3
221.7
373.5
404.8
674.2
121.5
86.4
1,638.8
209.6
354.5
385.9
687.7
3,281.6
38.8%
3,871.1
18.0%
4,364.6
12.7%
21.8
3,936.5
(9.8%)
57.2
13.1
4,476.6
13.7%
83.8
34.2
4,594.1
2.6%
100.1
107.1
4,841.1
5.4%
104.5
186.3
4,060.3
(16.1%)
105.0
187.2
3,875.6
(4.5%)
105.5
188.2
3,778.1
(2.5%)
1,363.4 $
365.5
651.6
12.0
70.6
214.8
512.2
1,268.0 $
561.1
756.4
144.7
158.6
251.7
537.8
149.0 $
740.1
1,070.6
244.8
508.5
343.5
610.8
102.8 $
715.5
1,193.7
245.4
470.2
325.0
629.1
106.4 $
689.3
1,349.6
245.7
431.4
306.5
648.0
110.2 $
130.1
1,281.8
233.7
392.3
288.1
661.0
114.0 $
62.7
1,252.4
221.7
373.5
269.8
674.2
118.0
59.8
1,215.9
209.6
354.5
251.7
687.7
3,190.2
35.0%
3,678.3
15.3%
11.4
3,678.7
8.8%
35.9
13.7
3,731.3
1.4%
50.1
28.6
3,855.6
3.3%
52.2
89.4
3,238.8
(16.0%)
52.5
134.8
3,155.6
(2.6%)
52.8
135.5
3,085.5
(2.2%)
222.4 $
631.3
852.6
218.2
264.3
289.3
564.7
3,042.9
(17.3%)
191.9 $
684.8
957.1
243.6
387.9
327.6
587.3
3,380.2
11.1%
Projected
CAGR:
(23.2%)
23.1%
13.4%
37.4%
28.7%
19.1%
3.5%
N/A
N/A
6.9%
(23.4%)
18.9%
10.8%
37.4%
28.7%
15.6%
3.5%
N/A
N/A
4.8%
(23.6%)
14.6%
7.2%
37.4%
28.7%
10.8%
3.5%
N/A
N/A
2.7%
(1) Management based on 8/3 meeting data; Consensus based on Capital IQ forecasts as of 8/31/2021; Downside based on low end of market
share/size estimates.
45
Project Jaguar
FINANCIAL PROJECTION ASSUMPTIONS
Xyrem and Xywav Revenue Forecasts
Comparison of Management, Consensus, and Downside Cases(1)
($ USD in Millions)
FY16
FY17
Historical
FY18
FY19
FY20
FY21
FY22
FY23
FY24
Projected
FY25
FY26
FY27
FY28
FY29
FY30
FY16
FY17
FY18
FY19
FY20
FY21
FY22
FY23
FY24
FY25
FY26
FY27
FY28
FY29
FY30
# People
# People
# People
%
161,470
12,900
12,725
2.6%
162,495
13,525
13,213
3.8%
163,345
14,300
13,913
5.3%
164,120
14,950
14,625
5.1%
165,330
13,400
14,175
(3.1%)
166,157
166,987
167,822
168,661
169,505
170,352
171,204
172,060
172,920
173,785
10,468
(26.2%)
9,184
(12.3%)
8,055
(12.3%)
6,746
(16.3%)
5,085
(24.6%)
3,407
(33.0%)
3,424
0.5%
3,441
0.5%
3,458
0.5%
3,476
0.5%
% of Market on Xyrem Medication:
%
7.9%
8.1%
8.5%
8.9%
8.6%
6.3%
5.5%
4.8%
4.0%
3.0%
2.0%
2.0%
2.0%
2.0%
2.0%
Xyrem - Annual Price Increases Pre-Generics:
Xyrem/Xywav - Price Decrease Following Generics:
Xyrem - Annual Price Increases Post-Generics:
%
%
%
30,147 $
31,025
30,147
29,294
31,052 $
31,956
31,052
30,173
31,983 $
32,915
31,983
31,078
32,943 $
33,902
32,943
32,011
33,931 $
34,919
33,931
32,971
34,949
35,967
34,949
33,960
Revenue Assumptions:
Units:
Xyrem and Xywav Assumptions:
Total Market Size (# Potential Patients):
# Patients On Medication at End of Year:
Average # of Patients Throughout the Year:
Growth Rate in # of Patients:
Annual Price Per Patient - Xyrem:
Management
Consensus
Downside
$ as Stated
$ as Stated
$ as Stated
$ as Stated
Growth Rate in Price per Patient:
%
Xyrem - Revenue:
Annual Growth Rate:
$M
%
Xywav - Patients:
Growth Rate in # of Patients:
% of Market on Xywav:
Management
Consensus
Downside
$
87,043 $
13.0%
3.2%
12.4%
11.2%
9.4%
6.0%
6.0%
6.0%
(80.0%)
3.0%
3.0%
3.0%
3.0%
3.0%
3.0%
$
1,107.6 $
16.0%
1,186.7 $
7.1%
1,404.9 $
18.4%
1,642.5 $
16.9%
1,741.8 $
6.0%
1,363.4 $
(21.7%)
1,268.0 $
(7.0%)
1,178.9 $
(7.0%)
197.5 $
(83.3%)
153.3 $
(22.4%)
105.8 $
(31.0%)
109.5 $
3.5%
113.4 $
3.5%
117.3 $
3.5%
121.5
3.5%
–
–
–
–
950
4,154
337.3%
5,511
32.7%
6,713
21.8%
7,590
13.1%
8,475
11.7%
8,007
(5.5%)
7,704
(3.8%)
7,399
(4.0%)
7,090
(4.2%)
6,778
(4.4%)
0.6%
2.5%
2.5%
2.5%
2.0%
3.3%
3.5%
3.3%
3.0%
4.0%
4.5%
4.0%
3.3%
4.5%
5.5%
4.5%
3.5%
5.0%
6.5%
5.0%
3.7%
4.7%
6.3%
4.7%
3.5%
4.5%
6.1%
4.5%
3.3%
4.3%
5.9%
4.3%
3.1%
4.1%
5.7%
4.1%
2.9%
3.9%
5.5%
3.9%
2.7%
64,269
110,000
112,000
114,000
116,000
118,000
120,000
122,000
24,400
12,500
12,750
71.2%
1.8%
1.8%
1.8%
1.7%
1.7%
1.7%
(80.0%)
(48.8%)
2.0%
456.9 $
2893.5%
617.2 $
35.1%
765.3 $
24.0%
880.4 $
15.0%
1,000.1 $
13.6%
960.8 $
(3.9%)
939.9 $
(2.2%)
180.5 $
(80.8%)
88.6 $
(50.9%)
86.4
(2.5%)
# People
%
89,816 $ 100,979 $ 112,309 $ 122,875 $ 130,248 $ 138,063 $ 146,347 $ 29,269 $
130,248
138,063
146,347
155,127
130,248
138,063
146,347
29,269
130,248
138,063
27,613
28,441
N/A
N/A
N/A
N/A
%
%
%
%
Annual Price Per Patient - Xywav:
$ as Stated
Growth Rate in Price per Patient:
%
Xywav - Revenue:
Annual Growth Rate:
$M
%
Goldman Stanley
6.0%
80.0%
3.0%
$
$
-
$
-
$
-
$
-
$
15.3 $
(1) Management based on 8/3 meeting data; Consensus based on Capital IQ forecasts as of 8/31/2021; Downside based on low end of market
share/size estimates.
46
Project Jaguar
FINANCIAL PROJECTION ASSUMPTIONS
Historical and Projected Unlevered Free Cash Flow
Management Case Estimates(1)
($ USD in Millions)
Units:
$M
%
FY16
1,488.0
12.3%
FY17
1,618.7
8.8%
Historical
FY18
1,890.9
16.8%
FY19
2,161.8
14.3%
Operating Income (EBIT):
Operating (EBIT) Margin:
$M
%
615.4
41.4%
613.8
37.9%
657.7
34.8%
642.3
29.7%
765.5
32.4%
898.1
27.0%
1,123.0
27.2%
1,362.6
28.3%
1,601.5
29.0%
1,480.7
27.0%
1,538.5
26.7%
1,646.5
26.7%
1,102.5
21.7%
941.8
19.7%
826.8
17.9%
1,514.1
33.5%
(-) Taxes, Excluding Effect of Interest:
$M
(92.3)
(92.1)
(98.7)
(96.4)
(114.8)
(134.7)
(168.4)
(204.4)
(240.2)
(222.1)
(230.8)
(247.0)
(165.4)
(141.3)
(124.0)
(227.1)
Net Operating Profit After Tax (NOPAT):
$M
523.1
521.8
559.1
546.0
650.6
763.4
954.5
1,158.2
1,361.3
1,258.6
1,307.8
1,399.5
937.1
800.5
702.8
1,287.0
Total Adjustments for Non-Cash Charges:
$M
71.1
(43.9)
140.0
140.3
170.9
461.2
577.4
603.3
632.1
664.4
695.8
729.5
754.5
776.1
795.9
185.1
(+/-) Changes in Operating Assets & Liabilities:
% Change in Revenue:
$M
%
(20.9)
(12.8%)
26.8
20.5%
21.1
7.7%
(154.2)
(56.9%)
(85.4)
(42.3%)
(160.8)
(16.8%)
(135.5)
(16.8%)
(115.6)
(16.8%)
(118.3)
(16.8%)
6.5
(16.8%)
(47.9)
(16.8%)
(68.0)
(16.8%)
185.6
(16.8%)
47.5
(16.8%)
30.2
(16.8%)
15.5
(16.8%)
(-) Capital Expenditures:
% Revenue:
$M
%
(9.7)
0.7%
(29.0)
1.8%
(20.4)
1.1%
(40.1)
1.9%
(15.0)
0.6%
(39.9)
1.2%
(49.6)
1.2%
(57.9)
1.2%
(66.4)
1.2%
(65.9)
1.2%
(69.4)
1.2%
(74.2)
1.2%
(60.9)
1.2%
(57.5)
1.2%
(55.4)
1.2%
(54.3)
1.2%
(-) Intangible Purchases:
% Revenue:
$M
%
(150.0)
10.1%
0.0%
(111.1)
5.9%
(80.5)
3.7%
(113.0)
4.8%
(162.5)
4.9%
(202.1)
4.9%
(235.8)
4.9%
(270.3)
4.9%
(268.4)
4.9%
(282.4)
4.9%
(302.2)
4.9%
(248.1)
4.9%
(234.2)
4.9%
(225.4)
4.9%
(220.9)
4.9%
(-) Commercial Milestone Payments:
$M
-
-
-
-
-
(100.0)
(100.0)
(100.0)
(100.0)
(100.0)
(100.0)
-
-
-
-
-
(-) Acquisitions:
$M
(1,502.4)
-
-
(55.1)
-
(6,234.8)
-
-
-
-
-
-
-
-
-
-
Annual Unlevered Free Cash Flow:
Annual UFCF Growth Rate:
$M
%
(1,088.8)
475.7
(143.7%)
588.7
23.8%
356.4
(39.5%)
608.1
70.6%
(5,473.5)
(1000.1%)
1,044.7
(119.1%)
1,252.2
19.9%
1,438.3
14.9%
1,495.1
4.0%
1,504.0
0.6%
1,684.6
12.0%
1,568.1
(6.9%)
1,332.3
(15.0%)
1,248.0
(6.3%)
1,212.4
(2.9%)
Annual EBITDA:
Annual EBITDA Growth Rate:
EBITDA Margin:
$M
%
%
729.2
779.0
6.8%
48.1%
874.5
12.3%
46.2%
1,012.5
15.8%
46.8%
1,043.7 $
3.1%
44.2%
1,451.0 $
39.0%
43.7%
1,818.2 $
25.3%
44.0%
2,093.4 $
15.1%
43.4%
2,371.4 $
13.3%
42.9%
2,287.3 $
(3.5%)
41.7%
2,384.2 $
4.2%
41.3%
2,533.6 $
6.3%
41.0%
2,011.1 $
(20.6%)
39.7%
1,873.0 $
(6.9%)
39.1%
1,780.1 $
(5.0%)
38.6%
1,748.2
(1.8%)
38.7%
Normalized Net Income to Common:
Annual Net Income Growth Rate:
$M
%
454.7
(3.2%)
490.1
7.8%
480.5
(2.0%)
562.9
17.2%
552.0
(1.9%)
743.2
34.6%
946.8
27.4%
1,149.9
21.4%
1,047.2
(8.9%)
1,096.4
4.7%
1,188.2
8.4%
725.7
(38.9%)
589.1
(18.8%)
491.4
(16.6%)
Unlevered Free Cash Flow Projections:
Total Revenue:
Revenue Growth:
Goldman Stanley
N/A
N/A
49.0%
469.5
N/A
Projected
Normalized
FY20
FY21
FY22
FY23
FY24
FY25
FY26
FY27
FY28
FY29
FY30
FY31
2,363.6 $ 3,322.4 $ 4,130.8 $ 4,820.1 $ 5,526.0 $ 5,487.1 $ 5,772.6 $ 6,178.0 $ 5,071.0 $ 4,787.9 $ 4,607.9 $ 4,515.7
9.3%
40.6%
24.3%
16.7%
14.6%
(0.7%)
5.2%
7.0%
(17.9%)
(5.6%)
(3.8%)
(2.0%)
(1) Management based on 8/3 meeting data.
47
Appendix B
Valuation Data
Goldman Stanley
48
Project Jaguar
VALUATION DATA
Comparable Public Companies
U.S.-Based Specialty Pharma Companies with LTM Revenue Between $1 and $5 Billion
($ USD in Millions)
Operating Statistics
Company Name
Catalent, Inc.
Incyte Corporation
Seagen Inc.
BioMarin Pharmaceutical Inc.
Emergent BioSolutions Inc.
United Therapeutics Corporation
Exelixis, Inc.
Neurocrine Biosciences, Inc.
Capitalization
Equity
Enterprise
Revenue(2)
EBITDA(2)
Normalized Net Income(2)(3)
Value(1)
Value(1)
CY 21
CY 22
CY 23
CY 21
CY 22
CY 23
CY 21
CY 22
CY 23
$ 22,515.3 $ 25,066.6 $ 4,253.2 $ 4,710.6 $ 5,118.4 $ 1,071.1 $ 1,263.5 $ 1,412.6 $
489.1 $
630.1 $
729.6
17,130.0
14,886.5
2,844.0
3,447.9
4,005.7
678.7
1,135.2
1,638.0
668.6
1,011.4
1,319.0
31,637.3
29,155.8
1,505.0
2,230.2
3,205.6
(378.9)
136.3
645.2
(418.0)
28.8
583.8
15,908.6
15,517.7
1,853.4
2,188.1
2,747.7
(7.7)
347.0
858.7
226.4
470.4
818.2
3,472.2
3,853.0
1,797.4
1,462.9
1,300.2
618.2
420.3
325.1
426.0
264.8
224.0
10,385.0
7,855.3
1,671.2
1,867.2
2,129.8
704.2
991.0
1,244.9
754.0
855.0
1,086.0
6,394.1
4,628.3
1,381.2
1,636.6
1,988.7
154.7
252.3
491.0
200.9
295.0
453.0
9,863.6
8,504.1
1,136.2
1,408.5
1,707.3
280.1
528.4
765.3
274.5
421.9
602.6
Maximum
75th Percentile
Median
25th Percentile
Minimum
$ 31,637.3 $ 29,155.8 $
18,476.3
17,904.9
13,146.8
11,695.3
8,996.2
7,048.6
3,472.2
3,853.0
4,253.2 $
2,101.1
1,734.3
1,474.1
1,136.2
4,710.6 $
2,534.6
2,027.7
1,593.1
1,408.5
5,118.4 $
3,405.6
2,438.7
1,918.4
1,300.2
1,071.1 $
685.1
449.2
114.1
(378.9)
1,263.5 $
1,027.1
474.3
323.3
136.3
1,638.0 $
1,286.8
812.0
606.6
325.1
754.0 $
534.0
350.3
220.0
(418.0)
1,011.4 $
686.3
446.2
287.4
28.8
1,319.0
885.1
666.1
551.1
224.0
45.9%
22.0%
19.3%
12.1%
(14.9%)
78.1%
62.8%
44.2%
19.4%
(27.5%)
39.2%
29.0%
24.3%
15.2%
6.3%
42.1%
27.5%
24.3%
8.3%
(25.2%)
53.1%
34.1%
27.8%
15.7%
6.1%
58.5%
41.9%
29.4%
24.9%
20.1%
Jaguar
$
3,281.6 $
3,871.1 $
4,364.6 $
1,434.5 $
1,710.6 $
1,905.5 $
538.2 $
653.6 $
791.4
15.3%
15.3%
41.0%
43.7%
44.2%
43.7%
Valuation Statistics
Company Name
Catalent, Inc.
Incyte Corporation
Seagen Inc.
BioMarin Pharmaceutical Inc.
Emergent BioSolutions Inc.
United Therapeutics Corporation
Exelixis, Inc.
Neurocrine Biosciences, Inc.
Capitalization
Equity
Enterprise
Value(1)
Value(1)
$ 22,515.3 $ 25,066.6
17,130.0
14,886.5
31,637.3
29,155.8
15,908.6
15,517.7
3,472.2
3,853.0
10,385.0
7,855.3
6,394.1
4,628.3
9,863.6
8,504.1
Maximum
75th Percentile
Median
25th Percentile
Minimum
$ 31,637.3 $ 29,155.8
18,476.3
17,904.9
13,146.8
11,695.3
8,996.2
7,048.6
3,472.2
3,853.0
19.4 x
7.7 x
5.6 x
4.4 x
2.1 x
13.1 x
6.3 x
4.8 x
3.9 x
2.6 x
9.1 x
5.1 x
4.3 x
3.5 x
2.3 x
30.4 x
28.3 x
22.7 x
13.8 x
6.2 x
44.7 x
19.1 x
16.1 x
11.1 x
7.9 x
45.2 x
17.8 x
11.5 x
9.3 x
6.3 x
70.3 x
41.0 x
31.8 x
19.7 x
8.1 x
35.7 x
28.6 x
21.7 x
15.0 x
12.1 x
54.2 x
22.3 x
15.9 x
13.8 x
9.6 x
Jaguar
$
4.6 x
3.9 x
3.4 x
10.4 x
8.7 x
7.8 x
15.4 x
12.7 x
10.5 x
8,306.0 $ 14,932.5 $
8,306.0 $ 14,932.5
Goldman Stanley
TEV / Revenue(1)(2)
TEV / EBITDA(1)(2)
P / E(1)(2)(3)
CY 21
CY 22
CY 23
CY 21
CY 22
CY 23
CY 21
CY 22
5.9 x
5.3 x
4.9 x
23.4 x
19.8 x
17.7 x
46.0 x
35.7 x
5.2 x
4.3 x
3.7 x
21.9 x
13.1 x
9.1 x
25.6 x
16.9 x
19.4 x
13.1 x
9.1 x NM
NM
45.2 x NM
NM
8.4 x
7.1 x
5.6 x NM
44.7 x
18.1 x
70.3 x
33.8 x
2.1 x
2.6 x
3.0 x
6.2 x
9.2 x
11.9 x
8.1 x
13.1 x
4.7 x
4.2 x
3.7 x
11.2 x
7.9 x
6.3 x
13.8 x
12.1 x
3.4 x
2.8 x
2.3 x
29.9 x
18.3 x
9.4 x
31.8 x
21.7 x
7.5 x
6.0 x
5.0 x
30.4 x
16.1 x
11.1 x
35.9 x
23.4 x
(1) Market data based on closing prices as of 8/31/2021.
(2) Forecasts based on Capital IQ consensus estimates.
(3) Normalized Net Income excludes non-recurring expenses.
2-Year
2-Year
Revenue
EBITDA
CAGR
CAGR
9.7%
14.8%
18.7%
55.4%
45.9% N/A
21.8% N/A
(14.9%)
(27.5%)
12.9%
33.0%
20.0%
78.1%
22.6%
65.3%
LTM
23.9%
17.0%
27.4%
6.3%
33.8%
39.2%
9.7%
24.7%
EBITDA Margin
CY 21
CY 22
25.2%
26.8%
23.9%
32.9%
(25.2%)
6.1%
(0.4%)
15.9%
34.4%
28.7%
42.1%
53.1%
11.2%
15.4%
24.7%
37.5%
CY 23
27.6%
40.9%
20.1%
31.3%
25.0%
58.5%
24.7%
44.8%
CY 23
30.9 x
13.0 x
54.2 x
19.4 x
15.5 x
9.6 x
14.1 x
16.4 x
49
Project Jaguar
VALUATION DATA
Precedent Transactions
U.S.-Based Bio/Pharma Sellers with LTM Revenue Above $500 Million Since 8/31/2011
($ USD in Millions)
Jaguar - Comparable M&A Transactions
Acquirer Name
AstraZeneca PLC
Sanofi S.A.
Shire plc
Allergan plc (fka: Actavis plc)
Bristol-Myers Squibb Company
Fresenius Kabi USA, LLC
Lonza Group Ltd
Danaher Corporation
Pfizer Inc.
AbbVie Inc.
Valeant Pharmaceuticals International Inc.
(nka:Bausch Health Americas, Inc.)
Merck & Co., Inc.
Mallinckrodt Public Limited Company
Allergan plc (fka: Actavis plc)
Forest Laboratories, LLC
Amgen Inc.
Valeant Pharmaceuticals International Inc.
(nka:Bausch Health Americas, Inc.)
Target Name
Alexion Pharmaceuticals, Inc.
Bioverativ Inc.
Baxalta Incorporated
Allergan, Inc.
Amylin Pharmaceuticals, LLC
Akorn, Inc.
Capsugel Inc.
Cepheid
Medivation, Inc.
Pharmacyclics LLC
Salix Pharmaceuticals Ltd.
Cubist Pharmaceuticals LLC
Questcor Pharmaceuticals, Inc.
(nka:Mallinckrodt ARD Inc.)
Forest Laboratories, LLC
Aptalis Holdings Inc.
Onyx Pharmaceuticals, Inc.
Medicis Pharmaceutical Corporation
Maximum
75th Percentile
Median
25th Percentile
Minimum
Goldman Stanley
Operating Metrics Valuation Multiples Premiums Paid to Undisturbed
Transaction
TEV /
TEV /
Share Price
Enterprise
LTM
LTM
LTM
LTM
1-Day
1-Week 1-Month
(1)
Date
Value
Revenue EBITDA Revenue EBITDA
Prior
Prior
Prior
2020-12-12 $ 40,021.1 $5,862.4 $3,061.8
6.8 x
13.1 x
44.9%
45.5%
37.4%
2018-01-22
11,037.8 1,168.5
474.8
9.4 x
23.2 x
63.8%
64.7%
95.7%
2016-01-11
35,218.9 6,148.0 2,105.0
5.7 x
16.7 x
37.5%
48.9%
43.7%
2014-11-17
68,725.9 7,003.2 2,330.0
9.8 x
29.5 x
54.2%
76.7%
75.1%
2012-06-29
6,637.7
651.7
(449.6)
10.2 x NM
101.4% 103.0%
73.5%
2017-04-24
4,789.0 1,101.9
445.9
4.3 x
10.7 x
34.8%
41.2%
51.9%
2016-12-15
5,500.0 1,000.0
344.0
5.5 x
16.0 x N/A
N/A
N/A
2016-09-06
4,078.8
564.3
0.6
7.2 x NM
54.0%
53.4%
47.9%
2016-08-22
14,003.7 1,027.1
456.5
13.6 x
30.7 x
118.0% 106.9% 127.8%
2015-03-04
20,166.7
816.1
112.9
24.7 x NM
38.6%
56.3%
64.8%
2015-02-22
16,137.2 1,133.5
154.8
14.2 x NM
43.9%
46.5%
57.1%
2014-12-08
2014-04-07
9,488.3
5,300.3
1,164.5
890.9
203.6
516.9
8.1 x
5.9 x
2014-02-18
2014-01-08
2013-08-25
2012-09-03
22,128.8
2,900.0
9,253.8
2,328.8
3,371.4
700.2
516.0
763.7
418.3
275.6
(151.5)
191.4
6.6 x
52.9 x
25.3%
29.9%
27.9%
4.1 x
10.5 x N/A
N/A
N/A
17.9 x NM
44.0%
52.8%
29.8%
3.0 x
12.2 x
39.4%
35.4%
33.7%
$ 68,725.9 $7,003.2 $3,061.8
20,166.7 1,168.5
474.8
9,488.3 1,027.1
344.0
5,300.3
763.7
154.8
2,328.8
516.0
(449.6)
24.7 x
10.2 x
7.2 x
5.7 x
3.0 x
46.6 x
10.3 x
52.9 x
29.8 x
16.4 x
11.8 x
10.3 x
37.2%
26.9%
118.0%
54.1%
43.9%
37.3%
25.3%
34.5%
38.6%
106.9%
60.5%
48.9%
39.9%
29.9%
(1) Transaction Enterprise Value based on Purchase Equity Value – Cash – Other Non-Core Assets + Debt + Preferred Stock + Noncontrolling
Interests + Other Long-Term Funding Sources.
44.2%
32.7%
127.8%
69.1%
47.9%
35.5%
27.9%
50
Project Jaguar
VALUATION DATA
Weighted Average Cost of Capital (WACC)
U.S.-Based Specialty Pharma Companies with LTM Revenue Between $1 and $5 Billion
($ USD in Millions)
Discount Rate Calculations - Assumptions:
Risk-Free Rate(1):
Equity Risk Premium(2):
Pre-Tax Cost of Debt(3):
Cost of Preferred Stock:
1.30%
5.50%
3.09%
–
Pre-Tax Cost of Debt:
(4)
Comparable Companies - Unlevered Beta Calculation :
Levered
Name
Beta
Debt
Catalent, Inc.
1.43
$ 3,265.0
Incyte Corporation
0.75
34.2
Seagen Inc.
0.82
BioMarin Pharmaceutical Inc.
0.53
1,119.8
Emergent BioSolutions Inc.
0.91
856.9
United Therapeutics Corporation
0.49
800.0
Exelixis, Inc.
1.06
Neurocrine Biosciences, Inc.
0.73
Median:
0.79
Jaguar
0.97
Jaguar - Levered Beta & WACC Calculation:
Unlevered
Beta
Current Capital Structure:
0.76
"Optimal" Capital Structure:
0.76
$
Preferred
Equity
% Debt
Stock
% Preferred
Value
12.5% $
359.0
1.4% $ 22,515.3
0.2%
–
17,130.0
–
–
31,637.3
6.6%
–
15,908.6
19.8%
–
3,472.2
7.2%
–
10,385.0
–
–
6,394.1
–
–
9,863.6
417.1
Debt
$ 7,602.4
538.9
3.4% $
-
Preferred
% Debt
Stock
47.8% $
3.4%
-
% Equity
86.1%
99.8%
100.0%
93.4%
80.2%
92.8%
100.0%
100.0%
Tax Rate
15.9%
21.0%
21.0%
24.6%
23.0%
19.0%
21.0%
26.3%
Unlevered
Beta
1.26
0.75
0.82
0.50
0.76
0.46
1.06
0.73
Cost of
Equity
9.2%
5.4%
5.8%
4.2%
6.3%
4.0%
7.1%
5.3%
Cost of
Debt
3.0%
3.9%
–
3.8%
2.6%
2.4%
–
–
$ 13,146.8
96.6%
21.0%
0.76
5.6%
2.5%
Equity
% Preferred
Value
–
$ 8,306.0
–
15,369.5
% Equity
52.2%
96.6%
Tax Rate
15.0%
15.0%
Levered
Beta
1.35
0.78
–
Cost of Equity Based on Comparables, Current Capital Structure:
Cost of Equity Based on Comparables, "Optimal" Capital Structure:
Cost of Equity Based on Historical Beta:
8.70%
5.59%
6.64%
WACC, Current Capital Structure:
WACC, Current Capital Structure and Historical Cost of Equity:
WACC, "Optimal" Capital Structure:
5.80%
4.72%
5.49%
Average WACC Produced by All Methods:
5.33%
Goldman Stanley
(1) Based on 10-year U.S. Treasury yield as of 8/31/2021.
(2) Based on Damodaran’s U.S. market ERP data as of January 2021.
(3) Based on weighted average YTM of company’s current debt issuances.
(4) Market data based on closing prices as of 8/31/2021.
Cost of
Preferred
5.0%
–
–
–
–
–
–
–
–
Company
WACC
8.3%
5.4%
5.8%
4.1%
5.5%
3.8%
7.1%
5.3%
5.4%
51