Slide 1: FY2019 Financial Results
NON-CONFIDENTIAL FY2019 Financial Results 12-month period ended December 31, 2019 17 February 2020 | Sosei Group Corporation (TSE:4565)
Slide 2: Disclaimer
Disclaimer The material that follows is a presentation of general background information about Sosei Group Corporation and its subsidiaries (collectively, the “Company”) as of the date of this presentation. This material has been prepared solely for informational purposes and is not to be construed
Slide 3: Agenda
Agenda 1 Overview of Financial Results 2 Operational Highlights and Strategic Outlook 3 Q&A 4 Appendix Note: This material was created to explain the details of our company and is not intended to be used for investment decisions. In addition, the contents reflect the views of our company at the time
Slide 4: Overview of Financial Results
1 Overview of Financial Results Chris Cargill, CFO 4
Slide 5: Summary Financial Highlights
Summary Financial Highlights 12 months ended 31 December 2019 1 Significantly improved financials in FY2019 – successful execution of corporate strategy Cash Profit of ¥2,802m ($25.7m) vs. loss of ¥5,704m ($51.7m) in prior corresponding period1, due to 2 strong revenue growth and rigorous focus on c
Slide 6: Significant improvement in FY2019
Significant improvement in FY2019 Our strategy is driving more sustainable financial metrics Revenue (JPY million) Cash Profit1 (JPY million) 2,802 9,726 3,550 (5,704) 12m to 31-Dec-18 12m to 31-Dec-19 12m to 31-Dec-18 12m to 31-Dec-19 Cash Operating Expenses1,2 (JPY million) Net Profit (JPY million
Slide 7: Consolidated Income Statement
Consolidated Income Statement Significant upfront/milestone payments and prudent cost management delivers profitability JPY million USD million Revenue by Type 12m ended 12m ended 12m ended 12m ended 1 1 31 Dec 2019 31 Dec 2018 31 Dec 2019 31 Dec 2018 3% 10% 15% 11% Revenue 9,726 3,550 89.2 32.2 Cas
Slide 8: Consolidated Balance Sheet
Consolidated Balance Sheet Cash liquidity and operational flexibility greatly improved due to debt refinancing JPY million USD million Cash Flow Bridge (12m ended 31 Dec 2019) As of As of As of As of USD Millions 31 Dec 31 Dec 31 Dec 31 Dec 2019 2018 2019 2018 Goodwill & intangibles 27,364 28,544 24
Slide 9: FY2019 Results – Top-end guidance met for key costs
FY2019 Results – Top-end guidance met for key costs Reaching profitability by achieving a sustainable balance of resources and capital Total R&D expenses1 Cash G&A expenses Q3 2019 ¥4,320 to 4,860m ¥1,620 to 2,160m Guidance ¥4,786m ¥2,164m Actual Rigorous focus on costs Overall costs declined (1
Slide 10: FY2020 Financial Guidance (12m to 31-Dec-20)
FY2020 Financial Guidance (12m to 31-Dec-20) Sustainable growth strategy to pursue profitability in 2020 Cash R&D expenses Cash G&A expenses ¥4,200 to 4,700m ¥1,800 to 2,300m Increase number of programs fully New ERP investment to drive Guidance funded by partners efficiencies Group-wide and (De
Slide 11: FY2019 Operational Highlights and FY2020 Strategic Outlook
2 FY2019 Operational Highlights and FY2020 Strategic Outlook Shinichi Tamura, Chairman and CEO 11
Slide 12: We achieved a lot in FY2019
We achieved a lot in FY2019 $15m milestone €40m collaboration SSTR5 agonist $2.5m milestone $6m milestones (total) Initiation of Phase 2 Creation of two asset- First subject dosed in Submission of QVM149 Nomination of first two trials of I/O program centric companies with Phase 1 study of MAA to the
Slide 13: Highly productive drug discovery engine generating next wave of high-value, novel candidates
Highly productive drug discovery engine generating next wave of high-value, novel candidates to fuel partnering activity Pre-Discovery / Preclinical Phase 1 Phase 2 Phase 3 Marketed Discovery development Multi-target M1M4 dual ag. A2a ant. A2a ant. combo(s) QVM149 Ultibro® Collaborations Alzheimer’s
Slide 14: Quality, not just speed, is what provides an edge in drug discovery
Quality, not just speed, is what provides an edge in drug discovery Successful drug discovery is best measured by the number of drug candidates delivered Path to Preclinical Candidate– Pharma Industry Standard Path to Preclinical Candidate – Sosei Heptares Drug Discovery Preclinical Drug Discovery P
Slide 15: Strategy leverages proprietary technology and core competencies
Strategy leverages proprietary technology and core competencies Extend technology/platform leadership EXECUTE NEW PARTNERSHIPS AND Generate high quality novel candidates PROGRESS EXISTING that are attractive partnering opportunities PARTNERSHIPS Enhance focus on high value collaboration or long term
Slide 16: Extend technology/platform leadership
Extend technology/platform leadership Technology-led discovery engine has revolutionized GPCR-targeted discovery NEW TECHNIQUE TO ADDING NEW IMAGE BIOMOLECULES Cryo- ? TECHNOLOGIES, TOOLS AND CAPABILITIES IN 2020 EM EXPANDS CAPACITY TO ACCELERATES AND EXPLORE MORE CHESS STAR® AI IMPROVES GPCRs GPCR
Slide 17: Concentrating our efforts in small molecule discovery
Concentrating our efforts in small molecule discovery Small molecules remain of great significance for the industry – and patients Small molecules1 Small molecules Global Pharmaceutical Market Sales (2019)1,2 Other modalities # FDA Novel Drug Approvals Other modalities 59 46 48 63% 64% 69% 63% 2017
Slide 18: Narrowing focus going forward on novel targets across immunology and inflammation
Narrowing focus going forward on novel targets across immunology and inflammation GPCR 20% Therapeutic 25% Targets Areas 50% 30% FUTURE FUTURE 9% 37% 75% Neurology 54% Immunology / Inflammation Other Significant untapped target opportunity. Rich source of exciting targets in Confidently going after
Slide 19: Generate high quality novel candidates attractive to partners
Generate high quality novel candidates attractive to partners Our core competencies are drug discovery and early development DRUG DISCOVERY EARLY DEVELOPMENT LATE STAGE DEVELOPMENT HEALTHY TECHNOLOGY DISCOVERY PRECLINICAL PATIENTS PH 2 PH 3 APPROVAL MARKET VOLUNTEERS BIG BIOTECH / PHARMA P
Slide 20: Targeting high value collaborations & long term ventures
Targeting high value collaborations & long term ventures Unique focus on lower cost, high value add programs Approaches to drug discovery and development Strategic focus on executing new programs to be funded by partners COST Wholly-owned Primary goal is $500m+ deals with High cost / world-lea
Slide 21: Steady state business model generating multiple value inflection points
Steady state business model generating multiple value inflection points New programs every 2 years 4 (to Lead Optimization stage) Programs $ $ $ Programs Programs $ $ $ $ $ $ $ Programs PARTNER PARTNER PARTNER PARTNER Pool of programs 2x PROGRESS Healthy Patient that can be 15+ FURTHER PCC1 Voluntee
Slide 22: Perfectly positioned to be an innovation partner of choice
Perfectly positioned to be an innovation partner of choice Big pharma are exiting UK/EU research … to close UK … to close UK … to close UK … to shut UK … to cut vaccine research site R&D site R&D facility neuroscience division in research center Belgium • R&D facility in Kent • R&D facility in Horsh
Slide 23: Continuing this year's strong momentum into FY2020
Continuing this year’s strong momentum into FY2020 1 2 3 4 5 6 Maintain Enter new high Achieve Seed multiple Advance Create new technology value drug important new in-house selected in- long-term and platform discovery and milestones on discovery house asset-centric leadership in development existin
Slide 24: Q&A
3 Q&A 24
Slide 25: Appendix
4 Appendix 25
Slide 26: Statutory disclosure of financials
Statutory disclosure of financials 12 months ended 31 Dec 2019 vs 9 months ended 31 Dec 2018 JPY million USD million 12m ended 31 Dec 2019 9m ended 31 Dec 2018 12m ended 31 Dec 2019 9m ended 31 Dec 2018 Revenue 9,726 2,872 89.2 25.9 Cash Cost of Sales (851) (335) (7.8) (3.0) Cash R&D (3,937) (5,187)
Slide 27: Developing new therapies for areas of high unmet medical need
Developing new therapies for areas of high unmet medical need ~42M ~3.1M ~1.6M ~1.1B ~50M ~450K ~300K ~50K affected affected affected in affected affected affected affected affected globally globally US (mod-sev globally globally globally globally globally uncontrolled) Atopic Cancer IBD Migraine De
Slide 28: Successful drug discovery is measured by the number of drug candidates delivered
Successful drug discovery is measured by the number of drug candidates delivered Number of programs in Sosei Heptares pipeline PRECLINICAL PHASE 1 PHASE 2 PHASE 3 7 6 2 1 28
Slide 29: Locations
Locations SOSEI HEPTARES PMO Hanzomon 11F Steinmetz Building North West House 2-1 Kojimachi, Chiyoda-ku Granta Park, Cambridge 119 Marylebone Road Tokyo 102-0083 CB21 6DG London NW1 5PU Japan United Kingdom United Kingdom