LifeArc’s $1.297 Billion Royalty Monetization

Covington advised LifeArc on the deal.

The deal consists of LifeArc monetization of a portion of its royalties relating to Keytruda® for $1.297 billion (approximately £1 billion).

Founded in 1992, LifeArc is a UK-based medical research charity.

This royalty monetization is the largest single-product royalty monetization ever done by a non-profit.

The transaction closed on May 10, 2019, the culmination of efforts that began in November 2018.

MTS Health Partners, L.P. acted as exclusive financial advisor to LifeArc in connection with the monetization, and the purchaser was CPPIB Credit Europe S.à r.l., a wholly owned subsidiary of Canada Pension Plan Investment Board (CPPIB).

This royalty monetization is a transformative transaction for LifeArc: it makes LifeArc one of the UK’s leading medical research charities by size of its investment assets and allows LifeArc to significantly expand its mission of advancing research that has direct benefits for human health.

This transaction also marks the second royalty monetization Covington has handled for LifeArc: in 2016, LifeArc sold a small proportion of its Keytruda® royalty interest for $ 150 million.

The Covington team was led by John Gourary (Picture), Alicia Zhang, and Chase Brennick (corporate), and included Morag Peberdy (intellectual property), Ansgar Simon, Kevin Zaragoza, and Guy Dingley (tax), Gregor Frizzell, Louise Freeman, and David Miles (UK law matters), Miranda Cole (antitrust), Don Murray (securities law matters), Scott Smith (M&A matters), and Len Chazen (governance matters).

Involved fees earner: Chase Brennick – Covington & Burling; Leonard Chazen – Covington & Burling; Miranda Cole – Covington & Burling; Guy Dingley – Covington & Burling; Louise Freeman – Covington & Burling; Gregor Frizzell – Covington & Burling; John Gourary – Covington & Burling; David Miles – Covington & Burling; Donald Murray – Covington & Burling; Morag Peberdy – Covington & Burling; Ansgar Simon – Covington & Burling; Scott Smith – Covington & Burling; Kevin Zaragoza – Covington & Burling; Alicia Zhang – Covington & Burling;

Law Firms: Covington & Burling;

Clients: LifeArc;

Author: Ambrogio Visconti