Next Edge CIA Disciplined Growth Portfolio · TSX:PCD.UN
Next Edge CIA Disciplined Growth Portfolio — Next Edge Bio-Tech Plus Fund — Investor Presentation (March 2019)
33 slides from Next Edge CIA Disciplined Growth Portfolio's investor presentation, March 2019
Slide 1: Next Edge Bio-Tech Plus Fund
Next Edge Bio-Tech Plus Fund March 2019
Slide 2: Important Notes
Important Notes The ‘Next Edge Bio-Tech Plus Fund’or the ‘Fund’ means the ‘Next Edge Bio-Tech Plus Fund’. Capitalized terms not defined in this presentation are defined as set forth in the prospectus of the Fund (the ‘Prospectus’). This communication is not, and under no circumstances is to be const
Slide 3: Cautionary Note Regarding Forward-Looking Statements
Cautionary Note Regarding Forward-Looking Statements The following presentation may contain forward-looking statements. All statements, other than statements of historical fact, that address activities, events or developments that Next Edge Capital Corp., the Portfolio Manager or any affiliates ther
Slide 4: Certain Risks of Investing in Next Edge Bio-Tech Plus Fund
Certain Risks of Investing in Next Edge Bio-Tech Plus Fund There are risks associated with an investment in the Fund, as a result of, among other considerations, the nature and operation of the Fund. An investment in units should only be made after consulting qualified sources of investment and tax
Slide 5: Certain Risks of Investing in Next Edge Bio-Tech Plus Fund
Certain Risks of Investing in Next Edge Bio-Tech Plus Fund Legislation and Litigation Risk From time to time, various legislative initiatives are proposed by governments which may have a negative impact on certain issuers whose securities are held in the portfolio of a mutual fund. In addition, liti
Slide 6: Investors and Borrowers
We are an alternative investment fund manager providing unique solutions for investors. For almost two decades our experienced team has launched numerous investment solutions in a variety of product structures. The people and approaches we discover may not be well known, but we believe they provide
Slide 7: Next Edge Capital Corp.
Next Edge Capital Corp. Formed in July 2006, was renamed Next Edge Capital Corp. after the spinout of Man Investments Canada Corp. from Man Group plc (“Man”) in June 2014. Licensed as an Exempt Market Dealer, Portfolio Manager and Investment Fund Manager. Management team responsible for raising over
Slide 8: A Young Sector Making Waves
A Young Sector Making Waves AE Editing humanity 1 Gra rae BIOTECH SUPERSTAR ‘The,Boom. Jn Genetic. Engineering
Slide 9: The Bio-Tech Opportunity
The Bio-Tech Opportunity • Curing the incurable: Breakthroughs in CF, HIV, Hep C, MS, RA, CVD, SCD, CML, Mono-Genetic diseases • Science Fiction meets Science Fact: Gene Therapy, CRISPR, CAR-T, Immuno-Oncology, Gene Sequencing, RNAi, Antisense • Acquisitions: Biotech as Farm System for Big BioPharma
Slide 10: Media Contributions and Television Appearances
Media Contributions and Television Appearances Called upon to provide biotechnology and healthcare insights for Bloomberg News, BNN, Globe & Mail, Streetwise, Cantech STAT ARTICLE BNN APPEARANCE STREETWISE REPORTS Eden Rahim Interview Eden Rahim Interview Eden Rahim Interview January 38th, 2019 June
Slide 11: Moore's Law of Sequencing Cost
From $2.7 Billion to Under $1,000 per DNA Sequence Moore’s Law of Sequencing Cost $100,000,000 MOORE'S LAW OF SEQUENCING COST 2001 -> 2015 $100,000,000 $10,000,000 COST $1,000,000 COST $100,000 $10,000 $1,000 $1,000 2001 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2015
Slide 12: A Decade of Biotech Breakthroughs
A Decade of Biotech Breakthroughs 2005-2018 2010 •2 new MULTIPLE SCLEROSIS drugs 2013 •2 new personalized medicines to treat the most dangerous forms of SKIN CANCER •A new oral treatment for MULTIPLE 2016 •First vaccine for the prevention of •First therapeautic CERVICAL CANCER CANCER VACCINE SCELROS
Slide 13: Progress is Being Made
Progress is Being Made Percentage Changes in Selected Causes of Death (All Ages) Between 2000 and 2015 Source: Alzheimer’s Association - 2018 Alzheimer’s Disease Facts & Figures 13
Slide 14: Medicines in Development for Neurological Disorders
Medicines in Development for Neurological Disorders Source: http://phrma-docs.phrma.org/files/dmfile/PhRMA_MIDReport_Neuro_2018_FINAL.pdf 14
Slide 15: Biotech is Undervalued
Biotech is Undervalued RELATIVE PRICE-EARNINGS RATIO: S&P BIOTECH P-E to S&P P-E 1992 - 2019 3.0 RATIO OF BIOTECH P-E to S&P P-E 2.5 2.0 1.5 1.0 0.5 0.0 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 YEAR Source: Bloomberg Data, Concept: Next Edge Capital Corp. D
Slide 16: Early Stages of A New Biotech Bull Market
Early Stages of A New Biotech Bull Market NASDAQ BIOTECH INDEX 2002 - 2019 PERCENT OF BIOTECH STOCKS ABOVE THEIR 200 DAY MOVING AVERAGE 100 90 PERCENT OF BIOTECH STOCKS ABOVE 200 DMA 3200 80 70 NASDAQ BIOTECH INDEX (^NBI) 60 1600 50 40 30 800 20 7 YEARS 7 YEARS 3 YEARS 10 400 0 02 03 04 05 06 07 08
Slide 17: Nervous Sentiment is Bullish
Nervous Sentiment is Bullish NBI VS FUND FLOW BREADTH RATIO (4-week MA) Source: Lipper (a Thomson Reuters company), FactSet, Piper Jaffray 17
Slide 18: Biotech Bull Markets Following Declines Greater than -40%
Biotech Bull Markets Following Declines Greater than -40%: 1980 - 2017 Source: Next Edge Capital Corp., Bloomberg Data, Reuters-Datastream Biotech represented by the Reuters Datastream World DS Biotechnology Index from 1980-1992 and by the Nasdaq Biotechnology Index from 1992 to Present. The dates c
Slide 19: Fund Returns Have and Will Continue to Benefit from M&A
Fund Returns Have and Will Continue to Benefit from M&A Public Company Biotech M&A Company Month Premium Medivation August 2016 117% Xenoport May 2016 65% Heartware June 2016 93% Transition June 2016 120% Cynapsus September 2016 123% Immunotec May 2017 22% ELOS July 2017 57% Spark Therapeutics Febru
Slide 20: The Path from Discovery to Commercialization
The Path from Discovery to Commercialization Sources: PhRMA adaptation of DiMasi JA et al.; Tufts CSDD7; FDA8 20
Slide 21: Investment Process
Investment Process Discipline: Handicapping Risky Outcomes VALUE-CREATING/DESTRUCTION PHASES OF DEVELOPING A RECOMBINANT BIOLOGIC DRUG BLOCKBUSTER PERCENT ADVANCE IN THE STOCK PRICE 1000 GOOD DRUG 950 STUDY PEER RE- PENDING P3 DATA: 900 SELL/HEDGE/SWAP TO OPTIONS VIEWED 850 SPECIALTY DRUG PAPERS 800
Slide 22: Why Focus on Post-Phase 2 Clinical Data?
Why Focus on Post-Phase 2 Clinical Data? Fund Manager’s predominate area of focus 22
Slide 23: Portfolio Managers
Portfolio Managers Eden Rahim is the Portfolio Manager for the Next Edge Bio-tech Plus Fund. The only dedicated Biotech Mutual Fund in Canada. Since the inception the fund has substantially outperformed its benchmark. Eden also possesses a top quartile 5-year 5-Star growth fund Portfolio Manager tra
Slide 24: Institutional Biotech Performance
Institutional Biotech Performance Portfolio Manager's Healthcare Performance at RBC 1995-2003* Cumulative & Absolute Performance versus TSX Healthcare Benchmark 450 110 400 90 350 70 Culumative RBC 300 Performance Annual Returns 50 250 (%) (%) 30 200 10 150 -10 100 50 -30 0 -50 1994 1995 1996 1997 1
Slide 25: Fund Performance
Fund Performance NEXT EDGE BIO-TECH PLUS FUND CLASS A UNITS1 & CLASS F UNITS1 VS. FUND’S BENCHMARK2 April 13, 2015 (Class A Units’1 Inception Date) to March 29, 2019 30% 20% 10% 0% Apr-15 Jul-15 Oct-15 Jan-16 Apr-16 Jul-16 Oct-16 Jan-17 Apr-17 Jul-17 Oct-17 Jan-18 Apr-18 Jul-18 Oct-18 Jan-19 -10% -2
Slide 26: Philosophy and Background
Philosophy and Background Managing the Fund requires unique combination of specialized skills: Proven knowledge, Hedging skills to navigate relationships and intense volatility and Volatility to be turned experience investing in frequent binary events, into a source of returns Biotechnology, and ena
Slide 27: Healthcare Allocation is An Essential Component
Healthcare Allocation is An Essential Component 27
Slide 28: Composition of Fund Holdings
Composition of Fund Holdings As of March 29, 2019 39.70% US & Foreign Equities 53.20% Canadian Equities 7.10% Cash Source: Next Edge Capital Corp., RBC Investor & Treasury Services Inc. 28
Slide 29: Conclusion
Conclusion The Next Edge Bio-Tech Plus Fund EDGE ●● Diversified access to healthcare growth companies ●● Strategy centered on companies in specific late-stage window of drug development ●● Fund is focused on risk mitigation through: a) proven disciplined stock selection process, and b) hedge overlay
Slide 30: Summary Of Terms
Summary Of Terms Next Edge Bio-Tech Plus Fund Class F Units – NEC 214 FundSERV Code Class A Units – NEC 213 Minimum Initial Investment $5,000 Minimum Additional Investment $1,000 1.25% Class F Manager’s Fee 2.25% Class A (1% Servicing Fee paid out of the Manager’s Fee) 20% of gains greater than the
Slide 31: Performance
Performance HISTORICAL PERFORMANCE1 Class A JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC YTD 2019 16.42% 13.20% 3.05% -- -- -- -- -- -- -- -- -- 35.81%3 2018 5.97% 1.84% 1.60% -8.80% 2.26% 2.02% -2.94% 4.43% 0.21% -12.13% -4.68% -11.29% -21.27% 2017 4.70% 9.94% 2.23% 3.04% -8.81% 9.44% -12.49% 1.
Slide 32: Fat-Tails is The Normal Distribution For Biotech
‘Fat-Tails is The ‘Normal’ Distribution For Biotech Biotech Index (BTK) vs S&P 500 Distribution of Monthly Returns 1989 to 2016 120 100 NUMBER OF MONTHS 80 RIGHT 60 LEFT TAIL TAIL 40 20 0 <-20% -20% to -10% to -7.5% to -5% to - -2.5% to 0 to +2.5 2.5 to 5 5 to 7.5 7.5 to 10 10 to 20 >20 -10% -7.5% -
Slide 33: For more information please contact
For more information please contact: Next Edge Capital Corp. 1 Toronto Street, Suite 200 Toronto, ON M5C 2V6 Local – 416.775.3600 Toll Free – 877.860.1080 info@nextedgecapital.com www.nextedgecapital.com
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