NewSpring Health Capital II Diversified Healthcare Fund

Transcription

1 NewSpring Health II Diversified Healthcare Fund Presentation to the Tobacco Settlement Investment Board August 2009

2 Agenda NewSpring Healthcare Highlights Fund II New Investments Pennsylvania Investment Statistics Questions & Answers 1

3 NewSpring Healthcare Targeted fund characteristics Multi-stage healthcare fund with balanced segment approach Specific investment criteria in the targeted sectors Clinical Development Market and Execution Clinical Trials Primarily Phase II and Phase III Market ready and FDA approved Products Healthcare Services Meaningful human clinical efficacy data Multiple clinical applications and opportunities Attractive specialty therapeutic segments Near term commercialization opportunity Growth & expansion Existing revenues; attractive CAGRs 20 25% 25 30% 40 50% 2

4 NewSpring Healthcare Highlights NewSpring Healthcare, which comprises Commerce Health Ventures ("CHV" or "Fund I") and NewSpring Health II ("NSH II" or "Fund II"), is focused on investing in the life sciences, medical device and healthcare service sectors. It is the healthcare sector-specific investment franchise of NewSpring, a $500mm+ fund family which has deep investment experience and a track record of top quartile returns. Fund II has invested $9.5mm in 2 companies in the healthcare services and medical device sectors. Robust, proprietary deal flow Reviewed >100 opportunities YTD 1Q'09 highlighted by following events: Two term sheets issued for equity investments in a healthcare IT services company and a medical device company; due diligence activities have commenced Evaluating additional opportunities for Fund II (reviewed >120 opportunities YTD) Fundraising efforts are ongoing (received additional commitments of >$15mm) Evaluating follow-on investment opportunities at portfolio companies for internal growth and M&A activities 3

5 NewSpring Health II Portfolio Company Precyse Solutions, LLC A provider of health information management services Company Overview: Precyse Solutions LLC, headquartered in Wayne, PA, is a nationwide provider of health information management (HIM) consulting solutions and medical transcription services to healthcare providers in the U.S. The Company s broad array of HIM products, technology and staffing solutions allow it to offer a full continuum of services to its clients. Initial Investment: April, 2008; Participating Preferred Stock invested: $6.5 million Lead: Brian Murphy Ownership: 12.4% CEO: Jeffrey Levitt Location: Wayne, PA Source: Professional Network Co Investors: Altaris Financials: ($ in millions) 07Act. 08Act. ʹ09Proj. Revenues $65.3 $71.1 $79..0 EBITDA $5.8 $5.8 $7.2 Investment Thesis/Rationale: Model Precyse Solutions provides an opportunity to invest in a company with a strong brand name, a reputation for service excellence and a trend setter in ʺBest Practicesʺ within the industry. The Company has a broad range of services backed by a scalable technology platform that provides clients with a ʺone stop shopʺ for their HIM needs. Market Precyse competes in a $35 billion market that is expected to grow at 8 10% per annum. This industry continues to feel an acute shortage of skilled labor which Precyse is able to fill efficiently. Management The company has an experienced management team which will remain active in the Company going forward. 4

6 NewSpring Health II Portfolio Company Core Essence Orthopaedics, Inc. Orthopedic medical device company Company Overview: Core Essence focuses on soft tissue and skeletal repair products. The Companyʹs products are targeted towards the upper and lower extremities of the human body, particularly the small bone and joint segment. In the orthopedic space this segment experiences the highest volume of surgical procedures. Initial Investment: June, 2008; Participating Preferred Stock invested: $3 million Lead: Zev Scherl Ownership: 30.6% CEO: Shawn Huxel Location: Yardley, PA Source: Professional Network Co Investors: Robin Hood Ventures and strategic investors Financials: ($ in millions) 08Act. 09Proj. 10Proj. Revenues $0.2 $2.4 $11.2 EBITDA $(0.8) $(3.1) $2.9 Investment Thesis/Rationale: Model Core Essence has developed/licensed and plans to market a range of products targeted towards upper and lower extremity arthroscopic surgeries. The Company intends to distribute its products through a network of distributors who have strong relationships with surgeons performing a high volume of procedures in this space. Market Core Essence competes in a $1 billion addressable market, that currently lacks innovative products targeted towards arthroscopic surgeries. Management The company has a management team that has extensive experience in developing, manufacturing and marketing medical device products. 5

7 NewSpring Health II Portfolio Company Sector/ Description Company Stage GP Role/ Board Seat Total Syndicated NSH Invested & Committed TSIB Highlights Co-Investors Precyse Solutions, Inc. Healthcare services: Provider of healthcare information management (HIM) services Leveraged buy-out Co-Lead 1 Seat $42.0mm $6.5mm $2.3 Leading provider of HIM services to hospitals 2008 revenues $71mm 2009 projected revenues $79mm Altaris, Management. Core Essence Orthopaedics, Inc. Medical Devices: soft tissue and skeletal repair products Growth and Expansion Lead 2 Seats $5.0mm $3.0mm $1.1 Products targeted towards minimally invasive procedures of the extremities 510(k) approval achieved key product in 1Q09 Robin Hood Ventures, strategic investors 6

8 Pennsylvania Investment Statistics Company Location # of PA Employees 2007 Revenues NSH Invested & Committed Syndicated Precyse Solutions, Inc. Wayne, PA 24 $65.3mm $6.5mm $42.0mm 6:1 Core Essence Orthopaedics, Inc. Leverage Ratio Yardley, PA 4 n/a $3.0mm $5.0mm 2:1 Total: 28 $65.3mm $9.5mm $47.0mm 5:1 7

9 Questions & Answers Radnor Financial Center 555 E. Lancaster Avenue, Suite 520 Radnor, PA Telephone: Brian G. Murphy tel: * * * Zev S. Scherl tel: zscherl@newspringcapital.com 8