Partner Company Overview
Avid Radiopharmaceuticals, headquartered in Philadelphia, PA and spun out of the University of Pennsylvania, is a leader in the development of molecular imaging products to enable early detection of pathology associated with neurodegenerative diseases.
Partnering with Safeguard
Safeguard deployed $12 million of capital in Avid between May 2007 and December 2011. During that time, Avid progressed through various clinical, regulatory and financial milestones, and established itself as a leader in the development of molecular imaging agents that have the potential for early disease detection of pathology associated with Alzheimer’s and other neurodegenerative diseases. The company grew from a single employee to over 50 employees, raised approximately $70 million in financing, and moved offices and R&D facilities from its original location at the University of Pennsylvania to a state-of-the-art facility at the University City Science Center in Philadelphia’s life science cluster.
Leading organizations in the life science industry took note of Avid’s accomplishments. In December 2007, Avid received Frost and Sullivan’s Molecular Imaging Technology Innovation of the Year Award, and was named the Eastern Technology Council’s Life Science Start-Up Company of the Year that same month. In 2009, Avid’s Founder, President and CEO Daniel M. Skovronsky, MD, PhD, was named Ernst and Young Entrepreneur of the Year. Then in November 2010, the Cleveland Clinic named the technology behind Avid’s imaging agent for the earlier detection of amyloid plaques one of the top 10 innovations of the year.
“Every innovative technology needs a strong advocate, and that’s what we found with Safeguard Scientifics and our other partners. The support we received from Safeguard—financial, operational and strategic guidance—exemplifies their understanding of the inherent value in diagnostic imaging technology, and underlines their vision to take a leadership position in this space.”
Daniel M. Skovronsky, MD, PhD,
CEO & President, Avid Radiopharmaceuticals (December 2010)
Results
In December 2010, Eli Lilly and Company (NYSE: LLY) acquired all outstanding shares of Avid for an upfront payment of $300 million. This represented an initial cash-on-cash return of 3x for Safeguard. Avid’s accelerated progress through various clinical milestones since May 2007 demonstrates the importance of partnering with life sciences companies that have strong management, innovative products and/or services and capital efficient paths towards commercialization. As a result of Avid’s fortitude and vision, Lilly recognized that Avid become the leader in the development of molecular imaging agents that have the potential for early disease detection of pathology associated with Alzheimer’s and other neurodegenerative diseases.
Subsequent to the acquisition, on April 6, 2012, Eli Lilly and Avid Radiopharmaceuticals announced that the U.S. Food and Drug Administration (FDA) approved Amyvid, a radioactive diagnostic agent indicated for brain imaging of beta-amyloid plaques in patients with cognitive impairment who are being evaluated for Alzheimer's Disease and other causes of cognitive decline. The achievement of this milestone triggered the payment of $5.6 million in additional proceeds to Safeguard, increasing expected total net proceeds to $41.3 million and a 3.4x cash-on-cash return. Depending on the achievement of difficult future regulatory and commercial milestones, Safeguard could see its cash-on-cash return increase to up to 8x.
