Greenhaven Road Investment Management, LP on AnaptysBio, Inc.
Thesis
AnaptysBio's value is heavily tied to royalties from GSK's Jemperli, which has grown into a strategically important oncology asset with more than $1 billion of sales. Greenhaven believes control of the royalty stream has increasing strategic value to GSK, particularly as Jemperli becomes a backbone for combination therapies. AnaptysBio is also litigating contractual issues with GSK, and a previous dispute resulted in a $60 million payment and a substantially improved royalty structure. GSK has reportedly attempted to acquire the company several times, leading Greenhaven to view an acquisition before the expected court ruling as the most likely outcome. The fund believes such an acquisition could occur at more than 50% above its purchase price.
“Before the ruling, I believe the most likely outcome is that GSK acquires AnaptysBio for a price more than 50% above our purchase price.”
Key risks
- An adverse litigation outcome could materially reduce value
- GSK may decide not to acquire or settle with AnaptysBio
- The company's economics are highly concentrated in Jemperli