Annual Report and Financial Statements
For the year ended 31 December 2025
Image shows human papillomaviruses (HPV) on the surface
of the skin. Precigen develops HPV-related immunotherapies
and gene-based treatments.
BioPharma Credit PLC
BioPharma Credit PLC provides investors
with the opportunity to gain exposure to the
fast‑growing life sciences industry.
Our diversified portfolio is primarily secured
by approved life sciences products and the
cash flows derived from their sales.
STRATEGIC REPORT
Performance Highlights 1
At a Glance 2
Chairman’s Statement 4
Investment Manager’s Report 6
Case Study – Precigen 19
Case Study – Valneva 20
Case Study – Harrow 21
ESG Programme and Sustainability 22
Strategic Overview 26
GOVERNANCE
Board of Directors 42
Directors’ Report 44
Corporate Governance Statement 47
Audit and Risk Committee Report 52
Remuneration Report 54
Remuneration Policy 58
Statement of Directors’ Responsibilities 59
Independent Auditor’s Report 60
FINANCIAL STATEMENTS
Statement of Comprehensive Income 68
Statement of Changes in Equity 69
Statement of Financial Position 70
Cash Flow Statement 71
Notes to the Financial Statements 72
ADDITIONAL INFORMATION
Glossary of Terms and Alternative Performance
Measures (APM)
99
Corporate Information 101
Shareholder Information 102
1
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
STRATEGIC REPORT
$0.9160
Share price ($):
(31 December 2024: $0.8840)
¢11.40
Net income per share ($):
(31 December 2024: ¢9.99)
10 .1 %
Discount to NAV per share (%):
(31 December 2024: 11.3%)
Performance Highlights
As at 31 December 2025
1,373.9m
Shares issued (m):
(31 December 2024: 1,373.9m)
10.9%
Dividend yield (%)
(31 December 2024: 11 . 5 %)
$1.0192
NAV per share ($):
(31 December 2024: $0.9963)
1,129.2m
Ordinary shares in issue with
voting rights (m):
(31 December 2024: 1,186.0m)
¢9.95
1
1
Payments over the calendar year, relating to 2025, totaling 6.75 cents per share, referencing net income for the three quarters ending 30 September 2024. Following the end
of the year, the Company declared a further dividend in respect of the last quarter of 2025 of 3.20 cents per share that was paid on 20 March 2026. Past performance is not
an indication of future performance.
Dividend declared (Cents)
(31 December 2024: ¢10.18)
This section includes Alternative Performance Measures (APMs). Refer to the glossary on page 99. Past performance is not an indication of future
performance.
$1,150.9m
Net assets ($m):
(31 December 2024: $1,181.7m)
244.7m
Shares in treasury:
(31 December 2024: 187.9m)
At a GlanceAt a Glance
At a Glance
STRATEGIC REPORT
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
2
Our primary objective is to continue to generate predictable income
for shareholders, through investments in debt assets primarily secured
by cash flows, including royalties, derived from the sale of approved
life sciences products.
BioPharma Credit PLC (the “Company”) holds a majority of its
investments through its financing subsidiary, BPCR Limited Partnership.
2025 NEW INVESTMENTS AND PURCHASES
Invested in
2025$M
Investment
Date
Funded in
2025 $M
Refinanced in
2025 $M
Alphatec senior unsecured convertible notes 15.0 07/03/2025 15.0 –
Evolus 2025 senior secured loan 62.5 05/05/2025 – 62.5
Paratek senior secured loan 25.0 21/05/2025 25.0 –
Celcuity senior unsecured convertible notes 2.5 01/08/2025 2.5 –
Precigen senior secured loan 50.0 03/09/2025 50.0 –
Harrow senior unsecured notes 35.0 12/09/2025 35.0 –
CytoKinetics senior unsecured convertible notes 30.0 19/09/2025 30.0 –
Novocure senior secured loan 50.0 26/09/2025 50.0 –
Valneva senior secured loan 30.0 17/10/2025 30.0 –
Cogent senior unsecured convertible notes 1.3 18/11/2025 1.3 –
Total 301.3 238.8 62.5
2025 REPAYMENTS
Investment Amount $M Repayment Date Gross IRR
1
Net IRR
1
Evolus senior secured loan 62.5 05/05/2025 15 .1% 12.0%
OptiNose senior secured loan 71. 5 21/05/2025 15.5% 12.4%
BioCryst senior secured loan
129.5 07/10/2025
2
15.3% 12.3%
Celcuity senior unsecured convertible notes 2.5 29/10/2025 1, 0 7 7. 2% 861. 8 %
Alphatec senior unsecured convertible notes 15 . 0 03/11/2025
3
64.4% 51.5 %
CytoKinetic senior unsecured convertible notes 1.3
4
22/12/2025 187. 9 % 150.3%
Collegium 2024 senior secured loan 290.4
5
23/12/2025 12 .1 % 9.7%
Total 572.7
1
Gross IRR and Net IRR as of the applicable repayment date. The definition of Gross IRR and Net IRR is set forth in the Glossary, refer to page 99. Past performance is not an indication
of future performance.
2
BioCryst prepaid $30 million of principal on 17 April 2025, $20 million on 23 July 2025 and then repaid the remaining balance of $79.5 million on 7 October 2025.
3
On 9 September 2025 and 31 October 2025, the Company sold shares of 8 million and 7 million face value respectively, of 0.75 per cent. Alphatec Holdings, Inc. senior unsecured
convertible notes due 2030, at an average price of $134. The sales generated a gain of $5 million. Past performance is not an indication of future performance.
4
On 22 December 2025, the Company sold 1.3 million face value, of 1.75 per cent. CytoKinetics, Inc. convertible senior unsecured convertible notes due 2031, at a price of $130.
The sale generated a gain of $413,000. Past performance is not an indication of future performance.
5
The Company’s total investment amount of the Collegium 2024 refinanced loan, see page 14 for further details.
2025 AMORTISATIONS
Opening Balance 2025
$M
Funded in
2025 $M
Principal
Payment in
2025 $M
Amortisation Payment in
2025 $M
Year End
Balance
2025 $M
BMS purchased payment 48.1 – 38.0 – 10 .1
Collegium 2024 senior secured loan 283 .1 – 261.4 21.7 –
Total 331.2 – 299.4 21.7
10.1
STRATEGIC REPORT
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
3
We will seek to achieve this by continuing to build a high-quality portfolio
of investments primarily secured by rights and cash flows, including
royalties, derived from the sale of approved life sciences products.
Asset
1
As at 31 Dec 2025
$m
Percentage as at
31Dec 2025
2
As at 31 Dec 2024
$m
Percentage as at
31Dec 2024
Cash and cash equivalents 422.3 36.7% 168.6 14.3%
Insmed 2024 senior secured loan 217. 3 18 .9 % 215.9 18.3%
Novocure senior secured loan 98.3 8.5%
4 7. 8 4.0%
Evolus 2025 senior secured loan 62.1 5.4% – –
UroGen 2024 senior secured loan 49.8 4.3% 49.6 4.2%
Geron senior secured loan 49.0 4.3% 48.8 4.1%
Precigen senior secured loan 48.9 4.2% – –
Tarsus senior secured loan 36.8 3.2% 36.7 3.1%
Harrow senior unsecured notes 36.5 3.2% – –
CytoKinetics senior unsecured convertible notes 35.9 3.1% – –
Alphatec senior secured loan 35.2 3.1% 34.7 2.9%
Valneva senior secured loan 29.4 2.6% – –
Paratek senior secured loan 24.8 2.2% – –
BMS purchased payments 10.1 0.9% 49.1 4.2%
LumiraDx Colombia equity 7. 5 0.7% 7. 5 0.6%
Cogent senior unsecured convertible notes 1.5 0.1% – –
Collegium 2024 senior secured loan – – 278.3 23.6%
BioCryst senior secured loan – – 12 7. 5 10.8%
OptiNose senior secured note, shares and warrants – – 70.4 6.0%
Evolus senior secured loan – – 61. 7 5.2%
Other net liabilities
(14.5) (1.4%) (14 .9 ) (1.3)
Total net assets 1,150.9 100.0% 1,181. 7 100.0%
1
Included are investments held through BPCR Limited Partnership and the figures are stated on a “look-through basis.”
2
Includes income accrued for exit consideration and additional consideration.
Cogent
LumiraDx Equity
BMS
Paratek
Valneva
-
Alphatec
CytoKinetics
Tarsus
Harrow
Precigen
Geron
Urogen
Evolus
Novocure
Insmed
Cash
-
200.0
400.0
600.0
800.0
1,000.0
1,200.0
31 Dec 2025
LumiraDx Equity
Alphatec
Tarsus
Novocure
Geron
BMS
Urogen
Evolus
OptiNose
BioCryst
Insmed
Collegium
Cash
-
200.0
400.0
600.0
800.0
1,000.0
1,200.0
31 Dec 2024
Chairman’s StatementChairman’s Statement
STRATEGIC REPORT
Chairman’s Statement
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
4
INTRODUCTION
2025 marks the eighth full year since the Company’s Initial Public
Offering (“IPO”) on the London Stock Exchange in March 2017.
Iampleased to be able to report on another year of consistent returns
and targets achieved. During 2025, the Company generated net
income per share of 11.40 cents, compared to 9.99 cents in 2024,
and paid 9.95 cents in dividends, 2.95 cents above the target of
7 cents,
1
compared to 3.18 cents above the 7 cent target in 2024.
Investors continue to benefit from the Company’s exposure to a high-
quality, diversified portfolio.
INVESTMENTS
Over the course of 2025, the Company and its subsidiaries invested an
aggregate of $301.3 million. Of this amount, $50 million was used to
fund an additional tranche of a current investment and $251.3 million was
deployed toward new investments. Out of the new investments, $167.5
million was invested in senior secured loans (Evolus, Paratek, Precigen
and Valneva), $48.8 million was invested in senior unsecured convertible
notes (Alphatec, Celcuity, Cogent and CytoKinetics) and $35 million
was invested in senior unsecured notes (Harrow). The Company saw
principal repayments from BioCryst, Collegium, Evolus and OptiNose
totaling $553.9 million, a total of $25.1 million in accrued interest,
prepayment and make-whole fees and sold $18.8 million face value of
convertible notes in Alphatec, Celcuity and CytoKinetics for a total gain of
$7.4 million. Repayments increased to $616.6 million in 2025, up from
$463.1 million in 2024, which, increased the pace of capital turnover
and provided additional liquidity to support new investment activity.
The Company has additional unfunded commitments with Evolus, Geron,
Novocure, Paratek, Precigen, UroGen and Zenas totaling $366.7 million
as of 23March 2026. Including assets and liabilities from its financing
subsidiary, BPCR Limited Partnership, the Company ended the year with total
net assets of $1,150.9 million, comprising $742.9 million of investments,
$422.3 million of cash less $14.4 million of other net liabilities.
During the first weeks of 2026, the Company has had several updates
to its current portfolio. The Company invested an additional $50million
in UroGen, sold 19.3 million of 1.75 per cent. CytoKinetics, Inc. senior
unsecured convertible notes, committed to invest up to $125 million with
Zenas BioPharma and invested an additional $25 million in Paratek.
DCM AND SHARE BUYBACKS
The Board recognises that the share price during 2025 represented a
significant discount to the NAV and together with the manager assessed
new strategies to ameliorate that discount. Under the Discount Control
Mechanism (“DCM”), the Company is required to use up to $50 million
over the calendar year to repurchase shares until such time that the
discount to NAV over a two-week period is less than 5 per cent. During
2025, the DCM was triggered, and the Company was required to use
its capital to repurchase shares, resulting in the purchase of 56,828,879
shares, which is 4.14 per cent. of the total shares in issue of the
Company, at an average share price of 86.9 cents and a total cost of
$50.3 million. Please see page 31 for a full description of the current
DCM, that will continue until otherwise amended. Since IPO, the
Company has bought back a total of 240,470,178 shares, which is
16.34 per cent. of the total shares in issue of the Company.
SHAREHOLDER RETURNS
1
The Company reported net income return from ordinary activities
after finance costs and before taxation for the year ended 2025 of
$129.9 million. On 31 December 2025, the Company’s Ordinary
Shares in issue closed at a share price of 91.60 cents, above the closing
price on 31 December 2024 of 88.4 cents. Net Asset Value (“NAV”)
per Ordinary Share in issue increased during the same timeframe by
STRATEGIC REPORT
1
Past performance is not indicative of future performance.
During 2025, the Company delivered
a strong financial and investment
performance, investing $301.3 million
in several investments. This performance
generated net income per share of
11.40 cents and supported dividends of
9.95 cents for the 2025 financial year. The
Company also repurchased 4.14 per cent
of shares in issue. A large repayment from
Collegium in December of 2025 increased
the cash balance to $422.3 million which
the Investment Manager is actively working
to redeploy.
STRATEGIC REPORT
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
5
$0.00
$0.02
$0.04
$0.06
$0.08
$0.10
$0.12
$0.14
2017 2018 20192020 20212022 2023 2024 2025
Special
BPCR annualized dividends per share in US$
1
lnterim
Ordinary
lnterim
2.29 cents from 99.63 cents to 101.20 cents. The Company made
three dividend payments over the calendar year, which related to
2025, totaling 6.75 cents per share, referencing net income for the three
quarters ending 30 September 2025. The Company was therefore
able to maintain its record of paying a dividend of at least 1.75 cents
per share in every quarter since 30 June 2018.
Following the end of the year, the Company declared a further dividend
in respect of the last quarter of 2025 of 3.20 cents per share made up
of an ordinary dividend of 1.75 cents together with a special dividend
of 1.45 cents that was paid on 20 March 2026. Total dividends related
to 2025 and 2024 results reached 9.95 cents and 10.18 cents per
share respectively. The 2025 and 2024 dividends were both covered
from profits.
The Company’s share price as of 20March 2026 was 94.00cents
which represents a 6 per cent. discount to NAV.
ESG
The Board has supported the Environmental, Social and Governance
(“ESG”) programme of Pharmakon during 2025, with progress made in
further incorporating ESG as part of the investment process. In addition
to managing environmental and social risks, the Company’s financing
activities support healthcare innovators, including companies such as
Valneva, which are developing vaccines aimed at addressing vaccine-
preventable diseases and contributing to improved public health
outcomes. The key areas are described in more detail on pages 22
to 25.
GEOPOLITICAL STATEMENT
The effects of major geopolitical and social risks, including the invasion
by Russia of Ukraine and the war between Israel and Hamas, may have
economic consequences that extend beyond the short term. However,
the Company does not have any direct investments with Russia, Ukraine
or Iran and has limited manufacturing exposure in Israel.
The Board will continue to monitor the situation and will inform
shareholders of any material changes to this assessment.
PRICING AND REGULATORY OUTLOOK
A significant portion of the revenues from borrowers in the portfolio come
from sales which are reimbursed by various US government entities that
are highly regulated. While we currently do not expect major changes
to how these entities will continue to reimburse for the cost of these drugs,
we cannot predict whether the US administration will seek to make
changes that may affect the sales of these products.
There were no major regulatory changes in 2025 that, in the Investment
Manager’s opinion, would impact the performance of the portfolio.
OUTLOOK
The Investment Manager highlights an expanding investment
pipeline as new products and companies enter the market from
2026 onward. The significant increase in the cash balance to
$422.3 million at 31 December 2025 came from the Collegium
repayment on 23December 2025. The Investment Manager is grateful
for Collegium’s partnership and is proud to have served as a trusted
financing source over the past six years. While this early repayment will
result in a higher-than-usual cash balance, the Investment Manager is
encouraged by the strength of the broader pipeline and looks forward to
further diversifying the portfolio. The Board also believes the Company’s
portfolio of floating- and fixed-rate loans remains well positioned to
deliver attractive returns in a shifting interest rate environment.
Following the annual general meeting (“AGM”) on 9 June 2025, the
Company announced that shareholders approved the continuation
of the Company’s business as a closed-ended investment trust with
99per cent. of shares voting, in favor. Under the existing articles of the
Company, a Continuation Resolution is required to be held at the first
AGM following the fifth anniversary of the Company’s IPO and at every
third AGM thereafter.
BOARD CHANGES
At this year’s AGM, both Colin Bond and Duncan Budge, who
have been on the Board for nine years as recommended by the UK
Corporate Governance Code, will not seek re-election. The Board
would like to thank Colin and Duncan for their invaluable contribution
during their tenure. Nigel Reynolds will replace Colin as Chair of
the Audit and Risk Committee and Sapna Shah will replace Duncan
as Senior Independent Director. To ensure continuity, I will remain
in post as Chairman until the end of 2026, then I will step down as
a Director and be replaced as Chairman by Rolf Soderstrom, current
non-executive Director. In the meantime, a process is underway to recruit
one additional non-executive Director.
On behalf of the Board, I should like to express our thanks to Pharmakon
for their continued efforts and achievements on behalf of the Company
in 2025 and to our shareholders for their continued support.
Harry Hyman
Chairman
23 March 2026
1
Past performance is not indicative of future performance.
Investment ManagerInvestment Manager
STRATEGIC REPORT
Investment Manager
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
6
Pharmakon is pleased to present an update on the Company’s
portfolio and investment outlook. The Company’s existing
portfolio investments continue to perform well.
New investments, together with multiple repayments, led to total income and return on ordinary
activities after finance costs and taxation for the portfolio during 2025 of $157.8 million and
$129.9 million respectively.
1
Pharmakon’s engagement with current and potential counterparties
throughout the year resulted in $301.3 million of investments for the Company.
2
The Company
also received $553.9 million in principal repayments and $25.1 million in accrued interest,
prepayment and make-whole fees on the private loans (including BioCryst, Collegium, Evolus
and OptiNose) and sold $18.8 million of convertible notes in Alphatec, Celcuity and CytoKinetics
for a total gain of $7.4 million.
See the chart below for the investment track record of non-convertible debt investments made by
the Company and prior funds managed by the Investment Manager.
Another year of strong investment returns
1
As of 24 March, 2026. Past performance is not indicative of future results. Please refer to page 99 for additional information. As set forth herein the Realized Gross and Net IRR for
each individual investment is determined in accordance with the methodology described in the legend on page 99. The Realized Net IRR for each realized investment is calculated by
applying a percentage reduction to the respective Realized Gross IRR based on the average percentage reduction from the realized gross IRR and realized net IRR from all previously
realized investments from prior closed private funds, in each case in accordance with the methodology described in the legend on page 99. The Investment Manager believes this
methodology is the appropriate approach to derive an approximate realized net IRR for realized investments in currently active funds. Excludes equity and convertible investments.
2
Referenced figures and amounts for Reata are inclusive of the Biogen settlement payment in 2025, net of any applicable transaction related expenses and costs. Past performance is
not indicative of future results.
3
LumiraDx shown as of 23 March 2026, reflecting amounts actually received as of such date, excluding any potential future proceeds from the anticipated sale of the Colombian
subsidiary. Past performance is not indicative of future results.
0%
10%
20%
30%
40%
50%
60%
70%
Dec-08 Dec-10 Dec-12 Dec-14 Dec-16 Dec-18 Dec-20 Dec-22 Dec-24
Realized Gross / Net IRR
Date of Investment
62% (29)
10.0% > <15.0%
Unlevered Returns have been consistent over the years (47 Realized Transactions)
1
34% (16) > 15.0%
4% (2) < 10.0%
160%
2
120%
2
BPCR Investments
Older Investments
Realized Net IRR
Realized Gross IRR
(1)%
3
(1)%
3
STRATEGIC REPORT
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
7
Current Portfolio Diversification
Cash
Insmed 2024
Novocure
Evolus 2025
UroGen 2024
Geron
Precigen
Tarsus
Harrow
CytoKinetics
Alphatec
Valneva
Paratek
BMS
Cogent
Type
Percentage
2
36.5%
18.8%
8.5%
5.4%
4.3%
4.2%
4.2%
3.2%
3.2%
3.1%
3.0%
2.5%
2.1%
0.9%
0.1%
Fair Value
(in $M)
422.3
217.3
98.3
62.4
49.8
49.0
48.9
36.8
36.5
35.7
35.2
29.4
24.8
9.9
1.5
CURRENT PORTFOLIO AS OF 31 DECEMBER 2025
Cogent
On 12 November 2025, the
Company, along with the Private
Fund also managed by the
Investment Manager (the “Private
Fund”), purchased 1.3 million face
value each of 1.625 per cent. senior
unsecured convertible notes due
2031 issued by Cogent Biosciences,
Inc. (Nasdaq: COGT) (“Cogent”) at
a price of $1.00 per note for a total
$1.3 million investment. The closing
price at 31 December 2025 was
$117.08.
Cogent is a clinical-stage biotechnology
company focused on creating precision
therapies for genetically defined diseases,
especially those driven by specific genetic
mutations. The market capitalization as of 16
March 2026 was $5.79 billion.
Investment type: Senior Unsecured
Convertible Notes
Purchase date: 12 November 2025
Total investment
amount:
$2.6m
Company
commitment:
$1.3m
Maturity: November 2031
Valneva
On 6 October 2025, the Company,
along with the Private Fund, entered
into a senior secured term loan
agreement with Valneva Austria
GmbH, a subsidiary of Valneva SE
(PAR: VLA) (“Valneva”), a specialty
vaccine company committed
to developing vaccines for the
treatment of infectious diseases in
high unmet areas.
Valneva drew down $215 million on
17October 2025. The Company’s share of
the transaction was $30 million, which was
funded by the Company through its subsidiary.
The loan bears interest at a fixed rate of 9 per
cent. per annum with a 2 per cent. additional
consideration for Tranche A that was paid at
closing.
Valneva currently markets three travel
vaccines globally while continuing to develop
a pipeline of candidates, including a Lyme
disease vaccine candidate in advanced
clinical development. Marketed products
include Ixiaro, Dukoral, and Ixchiq which
are vaccines approved against Japanese
encephalitis, cholera, and chikungunya
respectively. Valneva is headquartered in
France with operations in Austria, Sweden,
the UK, France, Canada, and the U.S. The
market capitalization as of 16 March 2026
was $914 million.
Investment type: Secured Loan
Initial investment
Date:
6 October 2025
Total loan amount: $215m
Company
commitment:
$30m
Maturity: October 2030
STRATEGIC REPORT
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
8
CytoKinetics
On 17 September 2025, the
Company and the Private Fund
purchased 30 million face value and
20 million face value, respectively,
for a total of 50 million of
1.75 per cent. senior unsecured
convertible notes due 2031
issued by CytoKinetics, Inc. at a
price of $1.00 per note for a total
$30 million investment. The
closing price at 31 December 2025
was $124.46. (Nasdaq: CYTK)
(“CytoKinetics”).
On 22 December 2025, the Company sold
1.3 million of 1.75 per cent. CytoKinetics, Inc.
senior unsecured convertible notes due 2031
at a price of $130. The sale generated a gain
of $413,000.
Cytokinetics is a U.S. based biopharmaceutical
company focused on developing medicines
that improve how muscles work and specializes
in drugs that directly target muscle proteins
to treat serious cardiac and neuromuscular
diseases. The market capitalization as of
16March 2026 was $7.49 billion.
Investment type: Senior Unsecured
Convertible Notes
Purchase date: 17 September 2025
Total investment
amount:
$50m
Company
commitment:
$30m
Maturity: October 2031
Precigen
On 3 September 2025, the
Company, along with the Private
Fund, entered into a senior secured
term loan agreement with Precigen,
Inc. (Nasdaq: PGEN) (“Precigen”),
a dedicated discovery, clinical
and commercial stage company
advancing the next generation
of gene and cell therapies using
precision technology to target
the most urgent and intractable
diseases.
Precigen drew down $100 million at closing
on 3 September 2025. The Company’s share
of the draw down was $50 million, which
was funded by the Company through its
subsidiary. The remaining tranche, of which
the Company’s share is $12.5 million, will be
available through 29 June 2027. The loan
bears interest at 3-month secured overnight
financing rate (“SOFR”), (subject to a 3.75 per
cent. floor), plus 6.50 per cent. and a 2.50
per cent. additional consideration for Tranche
A that was paid at closing. The additional
consideration for the remaining tranche will be
payable on the respective funding date.
Precigen’s first approved product is Papzimeos
(formerly PRGN-2012), an immunotherapy
for the treatment of adults with Recurrent
Respiratory Papillomatosis (RRP). Papzimeos
is the first and only FDA-approved therapy for
the treatment of adults with RRP. Papzimeos is
a non-replicating adenoviral vector-based
immunotherapy designed to express a fusion
antigen comprising selected regions of
human papillomavirus (HPV) types 6 and 11
proteins — the root cause of RRP. The market
capitalization as of 16 March 2026 was
$1.24 billion.
Investment type: Secured Loan
Initial investment
Date:
3 September 2025
Total loan amount: $125m
Company
commitment:
$62.5m
Maturity: September 2030
Harrow
On 12 September 2025, the
Company purchased 35 million
face value of 8.63 per cent. senior
unsecured notes due 2030 issued
by Harrow, Inc. at a purchase price
of $1.00 per note for a total $35
million investment. The closing price
of the notes at 31 December 2025
was $105.10 (Nasdaq: HROW)
(“Harrow”).
Harrow is a leading provider of ophthalmic
disease management solutions in the U.S.
marketing a portfolio of products used to
treat conditions of both the front and back
of the eye. The market capitalization as of
16March 2026 was $1.30 billion.
Investment type: Senior Unsecured
Notes
Purchase date: 12 September 2025
Total investment
amount:
$35m
Company
commitment:
$35m
Maturity: October 2031
STRATEGIC REPORT
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
9
Paratek
On 21 May 2025, the Company,
along with the Private Fund
entered into a senior secured term
loan agreement with Paratek
Pharmaceuticals, Inc. (“Paratek”),
alongside funds managed by
Oaktree Capital Management, L.P.
(“Oaktree”) and Q Aspen LLC (a
wholly owned subsidiary of Qatar
Investment Authority, “QIA”).
The Company, through its subsidiary, and
the Private Fund funded $50 million out of a
total $275 million senior secured loan facility.
The Company’s share of the transaction was
$25 million, which was funded by the
Company through its subsidiary. Oaktree and
QIA funded the balance of the $200 million
senior secured loan facility. Since Paratek
is a privately held company, further details
about the senior secured loan facility are not
publicly available, but the terms of the loan are
generally comparable with the Company’s
other investments.
Paratek is a privately held pharmaceutical
company providing innovative specialty
therapies for community care providers and
specialists. Paratek’s lead product, Nuzyra
(omadacycline), is a once-daily oral and
intravenous antibiotic indicated for adults with
community-acquired bacterial pneumonia
(CABP). On 21 May 2025, Paratek acquired
OptiNose, Inc. (“OptiNose”), a specialty
pharmaceutical company focused on
products for patients treated by ear, nose,
and throat (ENT) and allergy specialists. This
acquisition added Xhance, a propionate
nasal spray approved for the treatment of
chronic rhinosinusitis with nasal polyps and
without nasal polyps, to the portfolio.
Investment type: Secured Loan
Initial investment
date:
21 May 2025
Total loan amount: $200m
Company
commitment:
$25m
Maturity: –*
Evolus 2025
On 5 May 2025, the Company
and the Private Fund entered into
an amended and restated senior
term loan agreement for up to
$250 million with Evolus, Inc. (Nasdaq:
EOLS) (“Evolus”), a biopharmaceutical
company that develops, produces,
and markets clinical neurotoxins for
aesthetic treatments.
The new loan consisted of a $250 million
initial term loan, of which the Company’s
share is $62.5 million, to refinance in full the
existing term loan and two additional tranches
of $20.85 million each, that are available to
be drawn by 31 December 2026 subject to
customary conditions precedent set forth in
the amended and restated loan agreement.
The Company’s share of the new term loan
is $104.2 million. The loan bears interest at
3-month SOFR (subject to a 3.50 per cent.
floor), plus 5 per cent. with a 1 per cent.
additional consideration that was paid at
closing, of which the Company received
$625,000 and a 2 per cent. exit consideration
payable at maturity.
Evolus currently markets Jeuveau©, the first
and only neurotoxin dedicated exclusively
to aesthetics, and Evolysse™, a collection of
unique injectable hyaluronic acid (HA) gels.
On 13 February 2025, Evolysse was approved
by the Food and Drug Administration (“FDA”)
and is the first HA filler to recognize weight
loss in the patient label as a factor in wrinkle
formation. Evolus launched Evolysse in
April 2025. The market capitalization as of
16 March 2026 was $328 million.
Investment type: Secured Loan
Initial investment
date:
5 May 2025
Total loan amount: $250m
Company
commitment:
$104.2m
Maturity: May 2030
* Since Paratek is a privately held company, further details about the senior secured loan facility are not publicly available, but the terms of the loan are generally comparable with the
Company’s other investments.
STRATEGIC REPORT
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
10
Insmed 2024
On 31 October 2024, the Company
and the Private Fund entered
into an amended and restated
senior term loan agreement for
up to $547 million with Insmed
Incorporated (Nasdaq: INSM),
a biopharmaceutical company
focused on treating patients with
serious and rare pulmonary diseases
(“Insmed”).
The new loan consisted of a $397 million
initial term loan to refinance in full the existing
term loan and an additional $150 million
tranche. The Company, through its subsidiary,
funded its share of the additional tranche
totaling $60 million at signing on 31 October
2024. The loan bears interest at a fixed rate
of 9.60 per cent. per annum with a 2 per cent.
exit consideration.
Insmed’s commercial product, Arikayce,
launched in October 2018 and is indicated
for refractory mycobacterium avium complex
(MAC) lung disease. The product is currently
being commercialized in the US, Europe,
and Japan. On 12 August 2025, the FDA
approved Brinsupri (Brensocatib) as an oral
treatment for non-cystic fibrosis bronchiectasis
in adults and children 12 years and older,
and on 17 October 2025, the EMA’s CHMP
adopted a positive opinion recommending
approval of Brinsupri in the EU, approval is
expected by year-end 2025.
In June 2025, Insmed announced positive
topline data from the Phase 2b study of
TPIP, a dry powder inhalation formulation of
a Treprostinil prodrug, in pulmonary arterial
hypertension (“PAH”). Insmed anticipates
initiating a Phase 3 study of TPIP in patients
with PH-ILD in 4Q25 and in patients with PAH
in early 2026. The market capitalization as of
16March 2026 was $31.17 billion.
Investment type: Secured Loan
Initial investment
date:
31 October 2024
Total loan amount: $547m
Company
commitment:
$219m
Maturity: September 2029
Geron
On 1 November 2024, the Company
and the Private Fund entered into a
senior secured term loan agreement
for up to $250 million with Geron
Corporation (Nasdaq: GERN), a
commercial stage biopharmaceutical
company committed to extending
and enhancing the lives of people
living with blood cancers (“Geron”).
Geron drew down $125 million at closing
on 1 November 2024. The Company’s
share of the draw down was $50 million,
which was funded by the Company, through
its subsidiary. The remaining two tranches,
of which the Company’s share was $50
million, were due to expire on 31 December
2025. On 5 January 2026, the Company
and Geron entered into an amendment to
extend the availability period for Tranche B
and C to 30 September 2026 and extend the
make-whole period for Tranche A to 1 May
2027. The loan bears interest at 3-month
SOFR (subject to a 3 per cent. floor), plus
5.75per cent. and a 2.50 per cent. additional
consideration for Tranche A that was paid at
closing. The additional consideration for the
remaining tranches will be payable on their
respective funding dates.
Geron’s telomerase inhibitor Rytelo
(imetelstat) is approved in the United States
for the treatment of certain adult patients with
lower-risk myelodysplastic syndromes (LR-
MDS) with transfusion dependent anemia
and was launched in the United States in
June 2024. In March 2025, Geron received
marketing authorization for Rytelo from the
European Commission as a monotherapy
for ESA ineligible and ESA relapsed/
refractory non-del 5q patients with transfusion-
dependent anemia due to LR-MDS. Launch
planning is underway and Geron expects to
commercialize Rytelo in select EU countries
commencing in 2026.
Geron is also conducting a pivotal Phase
3 clinical trial of imetelstat in JAK-inhibitor
relapsed/refractory myelofibrosis (R/R MF),
as well as studies in other myeloid hematologic
malignancies. Inhibiting telomerase activity,
which is increased in malignant stem and
progenitor cells in the bone marrow, aims
to reduce proliferation and induce death of
malignant cells. The market capitalization as
of 16 March 2026 was $1.06 billion.
Investment type: Secured Loan
Initial investment
date:
1 November 2024
Total loan amount: $250m
Company
commitment:
$100m
Maturity: November 2029
STRATEGIC REPORT
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
11
Alphatec
On 29 October 2024, the Company
and the Private Fund entered into
a new investment in the form of
an assignment of $70 million of a
$200 million senior secured loan to
Alphatec Holdings, Inc. (Nasdaq:
ATEC) (“Alphatec”). The assignor,
Braidwell Transaction Holdings
LLC– Series I, retained the remaining
$130 million. Alphatec is a medical
device company that designs,
develops, and markets spine fusion
products and solutions for the
treatment of spinal disorders.
Alphatec drew down $50 million at closing
on 29 October 2024. The Company and the
Private Fund received $70 million in total via
assignment, of which the Company’s portion
was $35 million, where $50 million consisted
of the new funds drawn and the remaining $20
million was from the existing funded loan. The
loan bears interest at 3-month SOFR (subject
to a 3 per cent. floor) plus 5.75per cent., with
a SOFR adjustment of 0.11448 per cent. with
a 1 per cent. additional consideration that
was paid at closing and an exit consideration
of 3.25per cent.
On 7 March 2025, the Company purchased
15 million of 0.75 per cent. senior unsecured
convertible notes due 2030 issued by Alphatec
Holdings, Inc. at a purchase price of $1.00
per note for a $15 million investment. On 9
September 2025 and 31 October 2025,
the Company sold 8 million face value and
7 million face value respectively, of 0.75 per
cent. Alphatec Holdings, Inc. senior unsecured
convertible notes due 2030, at an average
price of $134. The sales generated a gain of
$5 million.
1
Alphatec offers intra-operative information
and neuromonitoring technologies, access
systems, interbody implants, fixation systems,
and various biologics offerings. The market
capitalization as of 16 March 2026 was
$1.91 billion.
Investment type: Secured Loan (via
Assignment)
Initial investment
date:
29 October 2024
Total loan amount: $200m
Company
commitment:
$35m
Maturity: January 2028
Novocure
On 1 May 2024, the Company and
the Private Fund entered into a senior
secured term loan agreement for up
to $400 million with a wholly owned
subsidiary of Novocure Limited
(Nasdaq: NVCR). Novocure owns
and commercialises a proprietary
platform technology that uses
electric fields that exert physical
forces to kill cancer cells via a variety
of mechanisms (“Novocure”).
Novocure drew down $100 million of the
$400 million loan on 1 May 2024, of which
$50 million was funded by the Company
through its subsidiary. On 26 September
2025, Novocure drew down $100 million of
Tranche B, of which $50 million was funded
by the Company through its subsidiary. The
remaining $200 million is available to be
drawn after achieving certain sales-based
milestones. The loan bears interest at 3-month
SOFR (subject to a 3.25 per cent. floor)
plus 6.25 per cent. A one-time additional
consideration of 2.50 per cent. of Tranche A
and Tranche B amounts were paid at signing,
and a one-time additional consideration of
2.50 per cent. of each remaining tranche will
be paid at funding.
Novocure is a global oncology company that
has a proprietary platform technology called
Tumor Treating Fields (“TTFields”), which are
electric fields that exert physical forces to
kill cancer cells via a variety of mechanisms.
Novocure’s product, Optune Gio, is
approved for the treatment of adult patients
with newly diagnosed glioblastoma. Optune
Lua was approved on 15 October 2024 and
is indicated for concurrent use with PD-1/
PD-L1 inhibitors or docetaxel, for the treatment
of adult patients with metastatic non-small cell
lung cancer who have progressed on or after
a platinum-based regimen.
Novocure also has ongoing or complete
trials investigating TTFields in brain metastases,
gastric cancer, GBM, liver cancer, and
pancreatic cancer. The market capitalization
as of 16March 2026 was $1.41 billion.
Investment type: Secured Loan
Initial investment
date:
1 May 2024
Total loan amount: $400m
Company
commitment:
$200m
Maturity: May 2029
STRATEGIC REPORT
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
12
UroGen 2024
On 13 March 2024, the Company
and the Private Fund entered into
an amended and restated loan
agreement for up to $200 million
with UroGen Inc. (Nasdaq: URGN)
(“UroGen”), a biopharmaceutical
company dedicated to creating novel
solutions that treat urothelial and
specialty cancers.
The new loan consisted of a $100 million
initial term loan to refinance in full the existing
term loan, of which the Company’s portion
was $50 million. The additional tranches of
up to $100 million were allocated in full to the
Private Fund. The loan bore interest at 3-month
SOFR (subject to a 2.50 per cent. floor)
plus 7.25 per cent. per annum with a SOFR
adjustment of 0.26161 per cent. A one-time
additional consideration of 1.75 per cent. of
the funded amount was paid at funding, and a
one-time additional consideration of 1.75 per
cent. of each remaining tranche would have
been be paid at funding, if certain milestones
are met. On 2 March 2026, the Company
and the Private Fund entered into an amended
and restated senior term loan agreement
with UroGen for $250 million. The existing
$125 million initial term loan was increased
to $200million in a new Tranche A (with the
additional $75million being funded at closing)
and an additional Tranche B was added for
up to $50million that expires 30June 2027.
The Company’s share of the transaction was
$150 million. The loan will mature in March
2031 and will bear interest at a fixed rate of
8.25 per cent. per annum. And a one-time
additional consideration of 1.50 per cent. of
each new tranche is payable upon funding of
each respective tranche, with the Company
receiving $1.5 million in connection with the
new Tranche A at signing. In addition, an exit
fee of 1 per cent is also required upon any
payment of principal.
UroGen’s products are being developed as
chemoablation agents designed to remove
tumors by non-surgical means. UroGen
markets JELMYTO (mitomycin), a prescription
medicine used to treat adults with a type of
cancer of the lining of the upper urinary
tract including the kidney called low-grade
Upper Tract Urothelial Cancer (LG-UTUC).
On 15 October 2024, the FDA accepted
UroGen’s NDA for UGN-102 for low-grade
intermediate risk Non-Muscle Invasive
Bladder Cancer (“NMIBC”) and granted a
PDUFA target action date of 13 June 2025.
On 12 June 2025, the FDA approved
ZUSDURI (UGN-102), the first and only FDA-
approved medication for adults with recurrent
LG-IR-NMIBC. The market capitalization as
of 16March 2026 was $912 million.
Investment type: Secured Loan
Initial investment
date:
13 March 2024
Total loan amount: $200m
Company
commitment:
$50m
Maturity: March 2028
Tarsus
On 19 April 2024, the Company
and the Private Fund entered into a
senior secured term loan agreement
for up to $200 million with Tarsus
Pharmaceuticals (Nasdaq: TARS)
(“Tarsus”), a biopharmaceutical
company focused on addressing
several diseases with high unmet
need across a range of therapeutic
categories, including eye care,
dermatology, and infectious disease
prevention.
Tarsus drew down $75 million at closing on
19 April 2024, of which $37.5 million was
funded by the Company through its subsidiary.
The remaining tranches totaling $75 million
expired without being drawn. The loan bears
interest at 3-month SOFR (subject to a 3.75
per cent. floor) plus 6.75 per cent. A one-time
additional consideration of 2.5 per cent. of
the funded amount was paid.
Tarsus currently markets XDEMVY® (lotilaner
ophthalmic solution), a treatment for Demodex
blepharitis. XDEMVY® was approved in the
US in July 2023. Tarsus also has 3 additional
clinical programs; TP-04 for ocular rosacea
(Phase 2) and TP-05 for the prevention
of Lyme disease (Phase 2) and malaria
(preclinical). The market capitalization as of
16March 2026 was $2.93 billion.
Investment type: Secured Loan
Initial investment
date:
19 April 2024
Total loan amount: $200m
Company
commitment:
$100m
Maturity: April 2029
STRATEGIC REPORT
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
13
1
Gross IRR is set forth in the Glossary, refer to page 99. Past performance is not an indication of future performance.
2
Net IRR is set forth in the Glossary, refer to page 99. Past performance is not an indication of future performance.
Bristol-Myers Squibb Company
On 8 December 2017, the Company’s
wholly-owned subsidiary entered
into a purchase, sale and assignment
agreement with a wholly-owned
subsidiary of Royalty Pharma
Investments (“RPI”), an affiliate of
the Investment Manager, for the
purchase of a 50 per cent. interest
in a stream of payments (the
“Purchased Payments”) acquired
by RPI’s subsidiary from Bristol-
Myers Squibb (NYSE: BMY) through
a purchase agreement dated
14November 2017.
As a result of the arrangements, RPI’s
subsidiary and the Company’s subsidiary
were each entitled to the benefit of 50 per
cent. of the Purchased Payments under
identical economic terms. The Purchased
Payments were linked to tiered worldwide
sales of Onglyza and Farxiga, diabetes
agents marketed by AstraZeneca, and
related products. The Company funded all of
the Purchased Payments based on sales from
1 January 2018 to 31 December 2019 for
a total of $162 million. The final payment of
$10.2 million was received on 13 March
2026. Based on sales from 1 January 2020 to
31 December 2025, the Company received
$243 million consisting of $162 million of
principal and $81 million in interest.
Investment type: Purchased
Payments
Initial investment
date:
8 December 2017
Total loan amount: $324m
Company
commitment:
$162m
Maturity: March 2026
REALISED INVESTMENTS
The following table details investments realized during the 31 December 2025 and 31 December 2024 periods.
Amount Funded Repayment Date Gross IRR
1
Net IRR
2
Prepayment and
Make‑whole Fees
Collegium 2024 senior secured loan 481.2 23/12/2025 12.1% 9.7% 7.9
CytoKinetics senior unsecured convertible notes 1.3 22/12/2025 187.9% 150.3% –
Alphatec senior unsecured convertible notes 15.0 03/11/2025 64.4% 51.5% –
Celcuity senior unsecured convertible notes 2.5 28/10/2025 1,077.2% 816.8% –
BioCryst senior secured loan 120.0 07/10/2025 15.3% 12.3% 4.4
OptiNose senior secured loan 71.5 21/05/2025 15.5% 12.4% 11.3
Evolus 2021 senior secured loan 62.5 05/05/2025 15.1% 12.0% -
Immunocore senior secured loan 25.0 08/11/2024 14.6% 11.7% 1.0
Insmed 2022 senior secured loan 140.0 31/10/2024 14.7% 11.8% –
Reata senior secured loan 62.5 05/09/2024 158.0% 126.4% 15.5
LumiraDx senior secured loan (Total) 176.0 -0.5% -0.7% –
LumiraDx 120.7 31/07/2024 0.4% 0.3% –
LumiraDx 20.1 31/07/2024 -21.9% -17.5% –
LumiraDx 35.2 31/07/2024 5.4% 4.3% –
Collegium 2022 senior secured loan 325.0 28/07/2024 14.3% 11.5% –
Coherus senior secured loan (Total) 125.0 16.7% 13.3% 5.4
Coherus 87.5 01/04/2024 16.6% 13.3% 3.1
Coherus 37.5 08/05/2024 16.8% 13.4% 2.3
UroGen 2022 senior secured loan 50.0 13/03/2024 14.5% 11.6% –
ImmunoGen senior secured loan 62.5 12/02/2024 60.2% 48.2% 13.2
Akebia senior secured loan (Total) 50.0 11.4% 9.1% 12.9
Akebia 10.0 15/07/2022 11.3% 9.0% 12.8
Akebia 40.0 29/01/2024 11.4% 9.1% 0.1
STRATEGIC REPORT
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
14
Collegium 2024
On 28 July 2024, the Company and the
Private Fund provided Collegium with a
commitment to enter into a new senior secured
term loan agreement for $645.8 million. The
new loan consisted of a $320.8 million initial
term loan, of which the Company’s share
was $160.4 million, to refinance in full the
existing term loan and a $325 million second
tranche, of which the Company’s share was
$130 million, that was drawn on
23 September 2024. Proceeds from the
new loan were used to assist Collegium in
the successful closing of the acquisition of
Ironshore Therapeutics. On 23 December
2025, Collegium repaid its remaining
$261.4 million balance to the Company,
and the Company received $7.9 million
of accrued interest and prepayment fees.
The Company and its subsidiaries earned a
12.1 per cent. gross internal rate of return
1
and 9.7 per cent. net internal rate of return
2
on
its Collegium 2024 investment.
Alphatec
On 5March 2025, the Company purchased
15 million of 0.75 per cent. senior unsecured
convertible notes due 2030 issued by
Alphatec Holdings, Inc. at a purchase price of
$1.00 per note for a $15 million investment.
On 9 September 2025 and 31 October
2025, the Company sold 8 million and
7 million face value respectively, of 0.75 per
cent. Alphatec Holdings, Inc. senior unsecured
convertible notes due 2030, at an average
price of $134. The sales generated a gain of
$5 million and earned a 64.4 per cent. gross
internal rate of return
1
and 51.5 per cent. net
internal rate of return
2
.
Celcuity
On 30 July 2025, the Company purchased
2.5 million of 2.75 per cent. senior unsecured
convertible notes due 2031 issued by
Celcuity, Inc. at a purchase price of $1.00
per note for a $2.5 million investment. On
27 October 2025, the Company sold
2.5 million of 2.75 per cent. Celcuity, Inc.
senior unsecured convertible notes due 2031
at a price of $181. The sale generated a gain
of $2 million and earned a 1,077.2 per cent.
gross internal rate of return
1
and 816.8 per
cent. net internal rate of return
2
.
BioCryst
On 17 April 2023, the Company and the
Private Fund entered into a senior secured
term loan agreement for up to $450 million
with BioCryst, who BioCryst drew down
$300 million at closing. On 17 April 2023,
the Company funded $120 million through
its subsidiary and BioCryst elected to PIK
interest of $9.5 million. The commitment
for the remaining three tranches of up to
$50 million each expired on 30 September
2024. The loan was due to mature in April
2028 and bore interest at 3-month SOFR plus 7
per cent. per annum subject to a 1.75 per cent.
floor and up to 50 per cent. of the interest during
the first 18 months were paid-in-kind (PIK) at a
rate of 3-month SOFR plus 7.25 per cent. The
Company funded $120 million on 16 April
2023. On 18 April 2025, BioCryst prepaid
$30 million of its balance to the Company
and the Company received $1.1 million
in accrued interest and prepayment fees.
On 24 July 2025, BioCryst prepaid $20
million of its balance to the Company
and the Company received $751,000 in
accrued interest and prepayment fees. On 8
October 2025, BioCryst repaid its remaining
$79.5 million balance to the Company and
the Company received $2.6 million in accrued
interest and prepayment fees. The Company
and its subsidiaries earned a 15.3 per cent.
gross internal rate of return
1
and 12.3 per
cent. net internal rate of return
2
on its BioCryst
investment.
OptiNose
On 12 September 2019, the Company and
the Private Fund entered into a senior secured
note purchase agreement for the issuance
and sale of senior secured notes in an
aggregate original principal amount of up to
$150 million by OptiNose US, Inc. a wholly
owned subsidiary of OptiNose, a commercial
stage specialty pharmaceutical company.
OptiNose drew a total of $130 million out
of the $150 million committed, of which the
Company, through its subsidiary, funded
$71.5 million. The notes were originally due to
mature in September 2024 and bore interest
at 10.75 per cent. per annum along with a
one-time additional consideration of 0.75
per cent. of the aggregate original principal
amount of senior secured notes which the
Company was committed to purchase under
the facility and 445,696 warrants exercisable
into common stock of OptiNose. After certain
amendments, the loan would have matured
in June 2027 and bore an interest rate of
3-month SOFR plus 8.50 per cent., subject
to a 2.50 per cent. floor. On 21 May 2025,
OptiNose entered into an agreement for
Paratek to acquire OptiNose. In connection
with the closing of such acquisition on 21 May
2025, the Company received a payment of
$82.8 million, comprised of $71.5 million
in returned principal and $11.3 million of
make-whole and prepayment fees, and
accrued interest. The Company also received
proceeds of $1.6 million in connection with
the Company’s outstanding OptiNose shares.
The Company and its subsidiaries earned a
15.5 per cent. gross internal rate of return
1
and 12.4 per cent. net internal rate of return
2
on its OptiNose investment.
Evolus 2021
On 14 December 2021, the Company and
the Private Fund entered into a senior secured
loan agreement for up to $125 million with
Evolus. The Company, through its subsidiary,
funded $37.5 million of the first tranche of
$75 million on 29 December 2021. The
remaining $50 million was drawn down in
two installments of $12.5 million each on
13 May 2023 and on 14 December 2023.
The loan would have matured in December
2027 and bore interest at 3-month SOFR
plus 8.50 per cent. with an additional
0.17per cent. adjustment per annum, subject
to a 1 per cent. floor along with a one-time
additional consideration of 2.25 per cent. of
the total loan amount paid at funding of the
first tranche. On 5 May 2025, the Evolus loan
was refinanced in full. The Company and its
subsidiaries earned a 15.1 per cent. gross
internal rate of return
1
and 12.0 per cent.
net internal rate of return
2
on its Evolus 2021
investment.
LumiraDx
On 23 March 2021, the Company and the
Private Fund entered into a senior secured loan
agreement with LumiraDx for $300 million.
The loan would have matured in March 2024
and bore interest at 3-month SOFR plus 8 per
cent. with the ability to PIK anything above 8
per cent., additional consideration of 2.5 per
cent. of the total loan amount and 9 per cent. of
1
Gross IRR is set forth in the Glossary, refer to page 99. Past performance is not an indication of future performance.
2
Net IRR is set forth in the Glossary, refer to page 99. Past performance is not an indication of future performance.
3
The market value of the LumiraDx Colombian subsidiary is subject to change.
STRATEGIC REPORT
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
15
the total loan amount payable upon repayment.
The Company’s allocation of the transaction
was $150 million. From 24 July 2023 to
9 November 2023, the Company, through
its subsidiary, and the Private Fund funded
$53 million of additional tranches to LumiraDx.
On 29December 2023, LumiraDx announced
the appointment of joint administrators for two of
its subsidiaries, and Roche Diagnostics Limited
(“Roche”) announced that it would acquire
LumiraDx group’s point-of-care diagnostics
platform business and certain related assets for
$295 million. On 29 July 2024, FTI
Consulting LLP (“FTI”), as the UK administrator
for LumiraDx, made an initial payment
to the Company and the Private Fund of
$330.6 million, of which $165.3 million was
received by the Company. On 31 October
2024, FTI returned $9.2 million to the
Company and $9.2 million to the Private Fund
which included the agreed holdback
amount under the Roche Sales and Purchase
Agreement. On 30 June 2025, FTI returned
$409,938 to the Company and $409,938
to the Private Fund. With the addition of cash
interest received from LumiraDx as of the end
of Q3 2024, this equated to an approximate
98 per cent. recovery rate of invested capital
by the Company and the Private Fund. At the
end of 2024, the Company and the Private
Fund received LumiraDx’s share ownership of
LumiraDx’s Colombian subsidiary, which they
are actively seeking to sell. If the Company and
the Private Fund were to receive the current fair
value of the Colombian subsidiary, this would
equate to an approximate 102 per cent.
recovery rate.
3
Reata
On 5 May 2023, the Company and the
Private Fund, entered into a senior secured term
loan agreement for up to $275 million with
Reata Pharmaceuticals Inc. (“Reata”) originally
due to mature in May 2028. Tranche A of
$75 million was funded at closing. Tranche B
of $50 million and Tranche C of $75 million
were required to be drawn after achieving
certain performance-based milestones, and
TrancheD of $75 million was available at the
Company’s discretion after achieving certain
sales-based milestones. The loan bore interest
at 3-month SOFR plus 7.5 per cent. (subject
to a 2.5 per cent. floor). There was also a
2percent. additional consideration upon each
draw. The interest only period for the loan was
for 3 years but could have been extended to
4 years if trailing twelve-month sales were
greater than $250 million. The Company’s
share of the transaction was $137.5 million of
which $37.5 million was funded at closing. On
10July 2023, the Company funded Tranche B
of the Reata loan for $25 million. On 28July
2023, Inc. (“Biogen”) Biogen announced a
proposed acquisition of Reata for an enterprise
value of approximately $7.3 billion. The
acquisition closed on 29 September 2023. As
of the acquisition closing date, the Company
received prepayments including $15.5 million
in prepayment and make-whole fees. In April
2024, the Company and the Private Fund
filed a lawsuit in New York courts against
Biogen and Reata with respect to a dispute
about fees payable under the terms of the loan
agreement. In April 2025, the parties entered
into a settlement agreement, representing the
final resolution of this dispute. The Company
received an additional gross $8.5 million in
revenue from this settlement payment. The
Company and its subsidiaries earned a 158.0
per cent. gross internal rate of return
1
and
126.4 per cent. net internal rate of return
2
on its
Reata investment.
Coherus
On 5 January 2022, the Company and the
Private Fund entered into a senior secured
loan agreement for up to $300 million with
Coherus BioSciences, Inc. (“Coherus”), a
biopharmaceutical company building a
leading immunooncology franchise funded
with cash generated by its commercial
biosimilars business. Coherus drew down
$100 million at closing, another $100 million
on 31 March 2022, and an additional
$50 million on 14 September 2022. The
remaining $50 million commitment, of which the
Company’s share was $25 million, lapsed so
there were no additional funding commitments.
The Company, through its subsidiary, funded
$125 million across the first three tranches. The
loan would have matured in January 2027 and
bore interest at 3-month SOFR plus 8.25 per
cent. per annum subject to a 1 per cent. floor
along with a one-time additional consideration
of 2 per cent. of the total loan amount paid at
funding of the first tranche. On 1 April 2024,
Coherus prepaid $87.5 million of its balance
to the Company and the Company received
$31 million of accrued interest, additional
consideration, and prepayment and make-
whole fees. On 10 May 2024, Coherus
repaid its remaining $37.5 million balance to
the Company and the Company received $2.3
million of accrued interest and prepayment
and make-whole fees. The Company and
its subsidiaries earned a 16.7 per cent. gross
internal rate of return
1
and 13.3 per cent. net
internal rate of return
2
on its Coherus investment.
ImmunoGen
On 6 April 2023, the Company and the
Private Fund entered into a senior secured
loan agreement with ImmunoGen, Inc.
(“ImmunoGen”) for up to $125 million.
ImmunoGen drew down $75 million at closing
on 6 April 2023. The Company, through its
subsidiary, funded $37.5 million. The loan
would have matured in April 2028 and bore
interest at SOFR plus 8 per cent. (subject to
a 2.75 per cent. floor), with an additional
consideration of 2 per cent. of the total loan
amount. On 30 November 2023, AbbVie
announced it had entered into a agreement
to acquire ImmunoGen, Inc. The ImmunoGen
investment was marked up by $10.7 million
as of 31 December 2023 to account for the
discounted value of the expected prepayment
and the make-whole fees. The ImmunoGen
repayment was accompanied by prepayment
and make-whole fees totaling $13.1 million.
On 12 February 2024, ImmunoGen repaid
its remaining $37.5 million balance to the
Company and the Company received
$13.2 million of accrued interest, additional
consideration, and prepayment and make
whole fees. The Company and its subsidiaries
earned a 60.2 per cent. gross internal rate of
return
1
and 48.2 per cent. net internal rate of
return
2
on its ImmunoGen investment.
Akebia
On 11 November 2019, the Company and
the Private Fund entered into a senior secured
term loan agreement for up to $100 million
with Akebia Therapeutics, Inc. (“Akebia”),
a fully integrated biopharmaceutical
company focused on the development and
commercialisation of therapeutics for people
living with kidney disease. Akebia drew down
$80 million at closing and an additional $20
million on 10 December 2020. The Company,
through its subsidiary, funded $50 million across
1
Gross IRR is set forth in the Glossary, refer to page 99. Past performance is not an indication of future performance.
2
Net IRR is set forth in the Glossary, refer to page 99. Past performance is not an indication of future performance.
STRATEGIC REPORT
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
16
both tranches. The loan would have matured in
November 2024 and bore interest at LIBOR
plus 7.5 per cent. per annum along with a one-
time additional consideration of 2 per cent.
of the total loan amount paid at funding. The
Akebia loan began amortising in September
2022. On 29January 2024, Akebia prepaid
the remaining $17.5 million of the balance that
was due to amortise to the Company and the
Company received $87,500 in prepayment
fees. The Company and its subsidiaries earned
a 11.4per cent. gross internal rate of return
1
and 9.1 per cent. net internal rate of return
2
on
its Akebia investment.
Collegium 2022
On 14 February 2022, the Company and the
Private Fund provided Collegium (“Collegium
2022”), a biopharmaceutical company
focused on developing and commercialising
new medicines for responsible pain
management, with a commitment to enter into
a new senior secured term loan agreement
for $650 million. On 22 March 2022,
proceeds from the new loan were used to fund
Collegium’s acquisition of BDSI as well as repay
the outstanding debt of Collegium and BDSI.
At closing, the Company, through its subsidiary,
invested $325 million in a single drawing. The
four-year loan would have had $100 million in
amortisation payments during the first year and
the remaining $550 million balance would
have amortised in equal quarterly installments.
The loan would have matured in March 2026
and bore interest at 3-month LIBOR plus 7.50
per cent. per annum subject to a 1.20 per
cent. floor along with a one-time additional
consideration of 2 per cent. of the loan amount
paid upon signing and a one-time additional
consideration of 1 per cent. of the loan
amount paid at funding. On 23 June 2023,
the Company and the Private Fund entered
into an amendment which modified the loan
interest rate to 3-month SOFR plus 7.50 per
cent. with a SOFR adjustment of 0.26161 per
cent. On 28 July 2024, the Company and the
Private Fund refinanced the Collegium 2022
loan in full, among other things, to modify the
amortisation of the then outstanding balance of
$320.8 million, provide a second tranche
of up to $325 million to be drawn upon the
closing of an acquisition (40 per cent. of that to
be invested by the Company) and modify the
terms reducing the coupon to 3-month SOFR
plus 4.50 per cent. per annum subject to a
SOFR floor of 4 per cent.
The Company and its subsidiaries earned a
14.3 per cent. gross internal rate of return
1
and
11.5 per cent. net internal rate of return
2
on its
Collegium 2022 investment.
UroGen 2022
On 7 March 2022, the Company and
the Private Fund entered into a senior
secured loan agreement for up to $100
million with UroGen (“UroGen 2022”), a
biopharmaceutical company dedicated to
creating novel solutions that treat urothelial
and specialty cancers. UroGen drew down
$75 million at closing and the remaining
$25 million on 16 December 2022. The
Company, through its subsidiary, funded $50
million across the two tranches. The loan
would have matured in March 2027 and bore
interest at 3-month SOFR plus 8.25per cent.
per annum subject to a 1.25 per cent. floor
along with a one-time additional consideration
of 1.75 per cent. of the total loan amount paid
at funding of the first tranche and a one-time
additional consideration of 1.75 per cent. of
each remaining tranche will be paid at funding
as long as certain milestones are met. On 29
June 2023, the Company and the Private Fund
entered into an amendment which modified the
loan interest rate to 3-month SOFR plus 8.25
per cent. and an additional per annum rate
of 0.26161 per cent. On 13 March 2024,
the UroGen loan was refinanced in full. The
Company and its subsidiaries earned a 14.5
per cent. gross internal rate of return
1
and
12.0 per cent. net internal rate of return
2
on its
UroGen 2022 investment.
Insmed 2022
On 19 October 2022, the Company and
the Private Fund entered into a senior secured
loan agreement for $350 million with Insmed
(“Insmed 2022”), a biopharmaceutical
company focused on treating patients with
serious and rare diseases. The Company,
through its subsidiary, funded $140 million of
the $350 million loan on 19 October 2022.
Insmed had elected the option to accrue
50 per cent. of their interest due from closing
through 30 September 2024 as a PIK. The
loan would have matured in October 2027
and bore interest at a rate based upon the
3-month SOFR plus 7.75 per cent. per annum
subject to a SOFR floor of 2.50 per cent.
with a one-time additional consideration of
2 per cent. of the total loan amount paid at
funding. On 31 October 2024, the Insmed
loan was refinanced in full. The Company and
its subsidiaries earned a 14.7 per cent. gross
internal rate of return
1
and 11.8 per cent. net
internal rate of return
2
on its Insmed 2022
investment.
Immunocore
On 8 November 2022, the Company and
the Private Fund entered into a senior secured
loan agreement for up to $100 million with
Immunocore Limited (“Immunocore”), a
biopharmaceutical company focused on
developing a novel class of TCR bispecific
immunotherapies designed to treat a broad
range of diseases, including cancer, infectious
diseases and autoimmune diseases. The
Company, through its subsidiary, funded
$25 million of the first tranche of $50 million
on 8 November 2022. The remaining
$50 million Tranche B commitment, of which
the Company’s share was $25 million, expired
without being drawn. On 30 June 2024,
Immunocore paid $625,000 to the Company
in additional consideration on the expiration
of Tranche B. Tranche A was due to mature
in November 2028 and bore interest at 9.75
per cent. per annum along with an additional
consideration of 2.50 per cent. paid at funding.
On 8 November 2024, Immunocore repaid
the remaining $25 million and the Company
received $1.1 million in accrued interest
and prepayment fees. The Company and its
subsidiaries earned a 14.6 per cent. gross
internal rate of return
1
and 11.7 per cent.
net internal rate of return
2
on its Immunocore
investment.
Market Analysis
The life sciences industry is expected to
continue to have substantial capital needs
during the coming years as the number of
products undergoing clinical trials continues
to grow. All else being equal, companies
seeking to raise capital are generally more
receptive to non-dilutive debt financing
alternatives at times when equity markets
are soft, increasing the number and size of
fixed-income investment opportunities for the
Company, and will be more inclined to issue
equity or convertible bonds at times when
equity markets are strong. A good indicator of
1
Gross IRR is set forth in the Glossary, refer to page 99. Past performance is not an indication of future performance.
2
Net IRR is set forth in the Glossary, refer to page 99. Past performance is not an indication of future performance.
STRATEGIC REPORT
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
17
the life sciences equity market is the New York
Stock Exchange Biotechnology Index (“BTK
Index”). While there was some volatility in
the first half of 2025, the BTK index increased
31 per cent. during 2025 compared to 6 per
cent. during 2024.
3
Global equity issuance
by life sciences companies during 2025
was $61.5 billion, a 6 per cent. increase
from the $58.3 billion issued during 2024.
3
Similarly, the upturn in the life sciences equity
markets was reflected in increased convertible
bond issuance by life sciences companies;
issuances increased to $7.7 billion in 2025
from $4.4 billion in 2024.
3
We anticipate
2026 equity and convertible bond issuance
to remain comparable to 2025 levels which
should continue to support appetite for
non-dilutive debt during 2026. Acquisition
financing is an important driver of capital needs
in the life sciences industry in general and a
source of investment opportunities. An active
M&A market helps drive opportunities for
investors such as the Company, as acquiring
companies need capital to fund acquisitions.
Global life sciences M&A volume during
2025 was $120.1 billion, a 9 per cent.
decrease from the $131.3 billion witnessed
during 2024,
3
driven by the volatility in the
equity markets and uncertainty particularly in
the first half of the year. We are encouraged
by the number of M&A opportunities that are
starting to build up, which should lead to a
more active market in the near term.
Pricing and regulatory outlook
A significant portion of the revenues from
borrowers in the portfolio come from
sales which are reimbursed by various US
government entities that are highly regulated.
While we currently do not expect major
changes to how these entities will continue
to reimburse for the cost of these drugs, we
cannot predict whether the US administration
will seek to make changes that may affect
the sales of these products. No regulatory
changes in 2025 were considered by
Pharmakon to have a material effect on the
portfolio’s performance.
USD SOFR
The Company has seven loans with coupons
that reference 3-month USD SOFR and one
loan that references 1-month USD SOFR.
Three loans have a 3.50 per cent. SOFR
floor or greater and five have a floor ranging
from 2.25 per cent. to 3.25 per cent. As
of 31 December 2025, the 1-month and
3-month SOFR was 3.69 per cent. and 3.66
per cent. respectively, above the floors in the
eight loans. As of the report date, two loans
have triggered the SOFR floor.
International outlook
The invasion of Ukraine by Russia and the
war between Israel and Hamas has led to
increased market volatility and widespread
sanctions on Russian and Israeli assets and
individuals, contributing to the high inflation
introduced by the pandemic. While the
portfolio has no direct exposure in Russia,
Ukraine or Iran and has limited manufacturing
exposure in Israel. We remain vigilant in
monitoring this major event closely and will
inform investors of any material changes.
Investment outlook
We recognize that the company’s cash
balance is larger than the usual at year
end as a result of the Collegium repayment
in December. We continue to expect our
investment pipeline to grow as new products
and companies enter the market in 2026 and
beyond. Pharmakon’s extensive network and
thorough approach will continue to identify
strong investment opportunities. We remain
focused on our mission of creating the premier
dedicated provider of debt capital to the life
sciences industry while generating attractive
returns and sustainable income to investors.
Although the global economic outlook remains
uncertain, Pharmakon remains confident of its
ability to deliver its target dividend yield to its
investors.
Pedro Gonzalez de Cosio
Co-Founder and CEO, Pharmakon
23 March 2026
1
Gross IRR is set forth in the Glossary, refer to page 99. Past performance is not an indication of future performance.
2
Net IRR is set forth in the Glossary, refer to page 99. Past performance is not an indication of future performance.
3
Source: Factset
STRATEGIC REPORT
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
18
1
Case studies are presented for illustrative purposes only, have been selected in order to provide examples of the types of investments made by the Company and do not purport to be a
complete list thereof. It should not be assumed that investments made in the future will be comparable in quality or performance to the investments described herein. Certain information
in the case studies is based on the Company’s and the Investment Manager’s due diligence at the time of investment, and/or analysis and opinions of the Company, the Investment
Manager and/or the borrower regarding economic conditions and borrower initiatives, plans and opportunities. References to the investments included in the case studies should not
be construed as a recommendation of any particular investment or security. See page 7 for a complete list of current investments by the Company.
Case Studies
1
The following pages are Case Studies of three new investments
the Company entered into during the second half of 2025. We
are proud that these investments help to bring new life sciences
products to market and help patients globally.
Case Study ‒ Precigen
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
STRATEGIC REPORT
19
Precigen is a commercial‑stage biopharmaceutical
company dedicated to advancing the next generation
of gene and cell therapies using precision technology
to target the most urgent and intractable diseases.
Precigen’s lead asset, Papzimeos (zopapogene
imadenovec-drba), is the first and only FDA-approved
therapy for the treatment of adults with Recurrent Respiratory
Papillomatosis (RRP), an indication that limits quality of life
and requires repeated risky surgeries near the voice box. It
is a non-replicating adenoviral vector-based immunotherapy
designed to express a fusion antigen comprising selected
regions of Human papillomavirus (HPV) types 6 and 11
proteins. It is delivered through four subcutaneous injections
over a 12-week interval.
Papzimeos received full approval in the U.S. on
14 August 2025. In clinical trials, Papzimeos demonstrated
a 51 per cent. Complete Response (“CR”) at 1 year and
43 per cent. CR at 2 years. 86 per cent. of patients achieved
a partial response at 1 year. The label contained no black
box warnings, no adverse events above Grade 2, no Risk
Evaluation and Mitigation Strategies (“REMS”) requirements,
and no contraindications. RRP is a well-defined condition
estimated to affect ~27,000 patients in the U.S.
PRECIGEN
Source: Precigen
Case Study ‒ Valneva
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
STRATEGIC REPORT
20
Valneva is a specialty vaccine company developing
vaccines for the treatment of infectious diseases in
high unmet areas focusing on providing first‑in‑class
or best‑in‑class vaccines.
Valneva currently markets three travel vaccines globally,
including Ixiaro, Dukoral and Ixchiq. Ixiaro is an inactivated
vero cell culture-derived vaccine indicated for immunization
against Japanese encephalitis in adults and children 2+,
approved in 2019 and marketed in the U.S., Europe, and
Canada. Dukoral is an oral vaccine for the prevention of
diarrhea caused by Vibrio cholera, and in certain instances, for
ETEC, approved in 2003 and marketed in the EU, Canada,
Australia, New Zealand, and Thailand. Ixchiq is a single-dose,
live-attenuated vaccine for the prevention of chikungunya virus
approved in 2024 and marketed in EU and Canada.
In addition to its current portfolio of products, Valneva is
conducting a pivotal Phase 3 clinical trial in Lyme disease in
partnership with Pfizer. It is the most clinically advanced Lyme
disease vaccine program worldwide.
VALNEVA
Source: Valneva
Case Study ‒ Harrow
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
STRATEGIC REPORT
21
Harrow is a leading provider of ophthalmic disease
management solutions in the U.S., marketing a
portfolio of products used to treat conditions of both
the front and back of the eye.
Harrow’s branded ophthalmology platform is anchored by
Vevye, Iheezo, and Triescence. Vevye is the first and only
water-free cyclosporine solution for dry eye disease approved
in the U.S. in 2024. Key benefits include its class-leading rapid
onset, the durability of effect, and high tolerability. Iheezo is a
chloroprocaine solution approved in the U.S. for ocular surface
anesthesia. It was approved in 2023 and is the first branded
ocular anesthetic approved in the U.S. in 15years. Triesence
was relaunched in 2024 following 5 years on the FDA
shortage list. It is a triamcinolone acetonide for visualization
during vitrectomy. It is the only FDA-approved, preservative-
free synthetic corticosteroid with separate reimbursement in all
traditional care settings.
In addition to the branded products Harrow sells, the Company
owns ImprimisRx which is the leading U.S. ophthalmic-focused
compounding pharmacy. ImprimisRx has over 15,000
customers and dispensing capabilities in all 50 states. Harrow
recently added Byooviz and Opuviz to their product portfolio
via acquisition from Samsung Bioepis. The products are anti
VEGF biosimilars for wAMD, RVO, DME, and mCNV.
HARROW
Source: Harrow
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BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
22
ESG
INTRODUCTION
Founded in 2009, Pharmakon Advisors, LP is the investment manager of
the BioPharma Credit funds, which provide debt capital to companies
in the life sciences, including those developing biopharmaceuticals
and vaccines. We are proud that a significant portion of our past and
current investments support clinical trials, research, and the development
of innovative therapies and vaccines that benefit patients suffering from
a wide range of serious diseases, including various forms of cancer, rare
(orphan) diseases such as Pompe, Fabry, Cushing’s, Duchenne Muscular
Dystrophy, Sickle Cell Disease, Friedreich’s Ataxia, and Bronchiectasis,
as well as vaccines for infectious diseases such as Japanese encephalitis,
cholera and enterotoxigenic E. coli, and chikungunya. Through our
financing activities, we help increase the number of life sciences products
and preventive vaccines available to patients globally, improving global
health outcomes.
Based in New York, Pharmakon has a small but diverse and highly
specialized team of fourteen professionals focused on responsibly
investing and safeguarding the capital of our clients. As debt investors, we
believe that consideration of the material ESG factors applicable to our
industry is critical to our credit underwriting process. Systematic integration
of these considerations combined with our engagement activities helps
us reduce the overall credit risk of our portfolios and enhances our
analysis. We provide competitively priced capital to a growing number of
emerging life sciences companies on the forefront of developing lifesaving
and lifechanging therapies to positively impact and improve human health.
The purpose of this policy is to
set out Pharmakon’s approach
to integrating the consideration
of environmental, social, and
governance (“ESG”) risks and
value creation opportunities
into investments made through
our credit facilities with
companies and within our
own business operations.
1
Pharmakon’s ESG
Policy
1
Any ESG or impact, targets, programs, commitments, incentives, initiatives, or benefits referenced on the following pages are not being promoted to investors and do not bind any
investment decisions or the management or stewardship of any funds managed by the Investment Manager for the purpose of Regulation (EU) 2019/2088 on sustainability-related
disclosures in the financial services sector unless otherwise specified in the relevant fund documentation or regulatory disclosures. Any measures implemented in respect of such
targets, programs, commitments, incentives, initiatives, or benefits may not be immediately applicable to the investment of any funds managed by the Investment Manager and any
implementation can be reconsidered at the Investment Manager’s sole discretion.
STRATEGIC REPORT
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
23
$1.5bn
in R&D invested by our
current partners during 2025
1
71%
of the portfolio backed
by treatments for orphan diseases
as at 31 December 2025
1
$10.5bn
committed since 2009
as at 31 December 2025
1
$2.2bn
assets under management
as at 31 December 2025
1
75
clinical trials being funded
by our partners
as at 31 December 2025
1
Pharmakon further recognizes that ESG issues may affect
performance of portfolio investments and, furthermore, that the
effective management of ESG issues may contribute positively to
returns through alignment of interests of fund investors, the general
partner, portfolio company management teams, employees, and
other key stakeholders.
Pharmakon considers material ESG issues during its due diligence
and in the monitoring of portfolio investments to the extent reasonably
practical under the circumstances. It does this subject to the provisions
of the credit agreements, and to the duty of Pharmakon to seek to
maximize the returns on investment for BioPharma Credit funds.
SCOPE (WHAT DOES ESG MEAN TO PHARMAKON?)
For the purposes of this policy, “material” ESG issues are defined
as those issues that Pharmakon, in its sole discretion, determines
have or have the potential to have a direct substantial impact on an
organization’s ability to create, preserve, or enhance economic value,
as well as environmental and social value for itself and its stakeholders.
The policy is intended to reflect our general framework for managing
ESG issues through the lifecycle of an investment across Pharmakon’s
investment management business. As a debt investor, Pharmakon’s
ability to influence its portfolio companies is less than that of an
equity investor. However, Pharmakon conducts ESG diligence on its
borrowers in connection with potential investments, during the cycle
of its loans, and actively updates its process on how to continue
monitoring ESG issues in connection with its investments. As pertinent
matters arise, Pharmakon engages in constructive dialogue with
borrowers as to relevant ESG issues.
1
Including the private fund.
STRATEGIC REPORT
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
24
Examples of material issues are those that involve violations of human
rights, irresponsible treatment of the natural environment or other non-
ethical business conduct. More specifically, and as of the date of
approval of this policy, Pharmakon currently focuses on the following
factors within our definition of ESG:
Environmental
• GHG Emissions
• Green Building Standards
• Handling Hazardous Materials
• Waste Creation & Management
• Responsible Vendor Management
Social
• Labour Practices
• Patient Impact
• Cyber Security
• Employee Engagement
• Diversity
• Job Growth and Turnover
• Supporting Communities and Research
Governance
• Risk Management
• IP Protection
• Compliance with Regulatory Standards (i.e., FDA)
• Board
• Purpose & Affiliations
Pharmakon’s approach to ESG will be adjusted according to the
needs and expectations of its stakeholders. Although we currently
align ourselves with certain environmental and social concerns we
will modify and improve upon our focus to maximise the needs and
expectations of our stakeholders with the aim of creating long-term
stakeholder value and drive toward impactful results. Pharmakon is
conscious that the ultimate success of our ESG initiative will depend on
periodic reviews to ensure adherence and seek ways to continuously
make improvements. We believe that all employees are stakeholders
in the success of Pharmakon’s ESG initiative and should be actively
engaged in its design and compliance.
We are grateful to the Principles for Responsible Investing (PRI) and
the United Nations Department of Economic and Social Affairs.
Our policies and operational ESG strategy have been developed
with their principles in mind and continues to be influenced by their
guidance.
• PRI’s Six Core Principles
• 17 Sustainable Development Goals (“SDGs”)—United Nations
Department of Economic and Social Affairs
In addition, Pharmakon is a signatory to the New Commitment
to Patients signed in January 2020 by 215 biopharma CEOs and
industry leaders who recognize that (a) “we have a moral obligation
to develop the best medicines and ensure that every person who may
benefit has access to them” and (b) “that we need to ensure that we
act with the highest integrity and corporate responsibility—always
putting the interests of patients first”. The full text can be found at:
https://www.statnews.com/2020/01/08/new-biotechnology-
pharmaceutical-industry-commitment-patients-public/
Pharmakon is also a corporate sponsor for Life Science Cares, which
is an organization that was founded in 2016 by a consortium of life
science executives which strives to leverage the financial and human
capital of the life sciences industry, and partners with nonprofits, to
disrupt the cycle of poverty and inequality in communities. More
information can be found at:
https://lifesciencecares.org/.
We believe that our environmental, social and governance strategy,
policies and practices will create sustainable long-term value for our
Company, our employees, our investors and other stakeholders, while
also helping us reduce risk and identify new opportunities.
HIGHLIGHTS OF OUR ESG EFFORTS
• ESG-informed investment processes
• Contributions to multiple SDGs
• Focus on human capital and Diversity, Equity and Inclusion (DEI)
• Commitment to philanthropy
• Independent board and fund advisory committee
• Plans to reduce environmental footprint
DELIVERING FOR PARTNERS, PATIENTS, AND SOCIETY
By delivering value for our partners and their patients, we contribute
positively to multiple SDGs, including those that focus on expanding
health access and opportunity. While our work touches many SDGs,
we focus on those where we can have the greatest impact based
on our business, strategy and expertise. More specifically, those
are SDG-3 on Good Health and Well-Being; SDG-9 on Industry,
Innovation, and Infrastructure; SDG-10 on Reduced Inequality; and
SDG-17 on Partnerships for the Goals.
PHARMAKON’S COMMITMENT TO ESG
Pharmakon on behalf of itself, its employees, and its clients, is
committed to the consideration of ESG issues in connection with its
investment activities.
THE ROLE ESG PLAYS IN PHARMAKON’S OWN
OPERATIONS ENVIRONMENT
Pharmakon is focused on reducing its environmental footprint. Though
the majority of Pharmakon’s direct impact on the environment comes
from daily office-based activities, we are dedicated to protecting the
planet. Pharmakon supports sustainable business practices, and we
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BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
25
hope to build an internal sustainability program as we prioritise our
own local footprint.
Pharmakon aims to engage all of its employees in managing the
environmental impact of our business. Employees will regularly be
encouraged to participate in environmental awareness, training
and initiatives, including unrestricted access to this ESG policy.
Environmental considerations are also incorporated across our partner
network. For investment, environmental criteria are reviewed in the due
diligence process when appropriate. Pharmakon also seeks to partner
with organisations that promote strong environmental practices.
Appendix II (Environmental Policy) of this policy contains expanded
detail on the environmental policy for internal operations.
Social
The people and culture of Pharmakon are the primary factor in our
success. We strive to continually support the health, well-being, and
growth of our employees. To build a high-performing, diverse team, we
seek to foster an inclusive environment that stays true to our core values
– even as we continue to grow. Pharmakon maintains and strengthens
our social and human capital policies and practices. This includes
attracting, retaining, and developing top talent and fostering a highly
engaged, team-oriented culture with an owner operator mindset.
Our commitment to social responsibility also includes promoting
diversity, equity, and inclusion, as well as engaging and developing
our employees. Pharmakon keeps track of its efforts to promote
diversity, equity, and inclusion, including an annual review by the CEO
during meetings of the ESG committee, and Pharmakon highlights
the importance of such factors when working with any professional
recruiters as it grows its team. Pharmakon will strive to maintain and
adhere to our Diversity & Inclusion Policy, Employee Handbook, and
Human Rights Statement. Additionally, Pharmakon aims to transform
patient lives globally through supporting various communities. We
support our communities through philanthropy, such as by being a
sponsor for Life Science Cares, by engaging on critical health and
social needs to promote access to health care and health equity
because we believe everyone should have the opportunity to attain
their highest level of health. Pharmakon also supports the development
of young students by providing internships and mentorship to college
age individuals who are interested in learning about investing in the
life sciences.
Governance
Risk management, compliance and high ethical standards are
foundational to our culture. One of Pharmakon’s most valuable assets
is our reputation for integrity, professionalism, fairness and good
stewardship. Our strong corporate governance program, from board
and advisory committee oversight to robust management practices,
aligns the interests of our stakeholders and underpins our market-
leading position and the high esteem with which we are held in the
life sciences industry.
Governance Highlights
• BioPharma Credit PLC has a 100% independent board
• Executive-level oversight of ESG
• CEO led Investment Manager ESG committee responsible for ESG
strategy and disclosure
• ESG committee meets on no less than a quarterly basis
• 100% of employees participate in ESG related strategy and
implementation
• Robust governance policies and practices
• Culture of compliance and accountability
• Additional ethical safeguards include our whistleblower policy
• 100% of employees receive and are expected to sign the Employee
Handbook
• 100% of employees participate in compliance and ethics training,
and cybersecurity training
• 100% of employees and investors have access to grievance
channels
Pharmakon will make commercially reasonable efforts to remain
reasonably informed on ESG best practices and the development of
ESG. Pharmakon will aim to review the ESG policy on an annual basis.
DIVERSITY AND INCLUSION
We believe that we will only succeed in our goals if we are able
to attract and retain individuals of diverse backgrounds. Our success
relies on creating an inclusive environment where all of our employees
can do their best work, and where each can play a vital role in
achieving our collective goals. Pharmakon is committed to working
to continuously develop an organization that is diverse, equitable
and inclusive. Our goal is to provide every team member with the
ability to achieve success within an equitable work environment and
to encourage our teams to leverage diversity to drive innovation
and performance. The current makeup of our employee base is
representative of our commitment to diversity:
Current employees: 15
Any other ethnic group 50.0%
White 35.7%
Asian or Asian British 14.3%
Male 78.6%
Female 21.4%
Average tenure 5 years
12-month turnover 0%
Pharmakon is conscious that the ultimate success of our ESG initiative
will depend on periodic review to ensure adherence and seek ways
to continuously make improvement. We believe that all employees
are stakeholders in the success of Pharmakon’s ESG initiative and
should be actively engaged in its design and compliance.
Strategic OverviewStrategic Overview
Strategic Overview
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
STRATEGIC REPORT
26
BUSINESS MODEL
The Company’s business model follows that of an externally managed investment trust. The Company does not have employees and outsources
all its functions to third-party service providers, including the Investment Manager, Pharmakon Advisors LP, who is the Company’s principal service
provider. Subject to the overall supervision of the Board, the Investment Manager has responsibility for decisions relating to the day to day running
of the Company and the active investment management of the debt assets and all other investments. Further details on the terms of the management
agreement are set out on page 33.
INVESTMENT OBJECTIVE
The Company aims to generate long-term Shareholder returns, predominantly in the form of sustainable income distributions from exposure to the
life sciences industry.
INVESTMENT POLICY
The Company will seek to achieve its investment objective predominantly through direct or indirect exposure to Debt Assets, which include Royalty
Investments, Senior Secured Debt, Unsecured Debt and Credit Linked Notes.
DIVIDEND POLICY
The Company aims to generate long-term shareholder returns, predominantly in the form of sustainable income distributions from its investments in
the life sciences industry. The Company currently pays
1
, and continues to target, a 7-cent base annual dividend per ordinary share in four quarterly
payments of 1.75 cents per share. Typically, these are supplemented by excess income in the form of special dividend distributions in Q4 and in
some years, Q3 and Q4, where the Board determines that it is appropriate and able to do so (noting the requirement to pay out substantially all
income to maintain the Company’s investment trust status).
THE COMPANY MAY ACQUIRE DEBT ASSETS:
y Directly from the entity issuing the Debt Asset (a “Borrower”), which may be: (i) a company operating in the life sciences industry (a “LifeSci
Company”); or (ii) an entity other than a LifeSci Company which directly or indirectly holds an interest in royalty rights to certain products,
including any investment vehicle or special purpose vehicle (“Royalty Owner”);
y Or in the secondary market.
The Company may also invest in equity issued by a LifeSci Company, acquired directly from the LifeSci Company or in the secondary market.
“Debt Assets” will typically comprise:
y Royalty debt instruments
Debt issued by a Royalty Owner where the Royalty Owner’s obligations in relation to the Debt are secured as to repayment of principal and
payment of interest by Royalty Collateral.
y Priority royalty tranches
Contract with a Borrower that provides the Company with the right to receive payment of all or a fixed percentage of the future royalty
payments receivable in respect of a Product (or Products) that would otherwise belong to the Borrower up to a fixed monetary amount or a
pre-set rate of return, with such royalty payment being secured by Royalty Collateral in respect of that Product (or Products).
y Senior secured debt
Debt issued by a LifeSci Company, and which is secured as to repayment of principal and payment of interest by a first priority charge over
some or all of such LifeSci Company’s assets, which may include: (i) Royalty Collateral; or (ii) other intellectual property and marketing rights
to the Products of that LifeSci Company.
y Unsecured debt
Debt issued by a LifeSci Company which is not secured or is secured by a second lien on assets of the Borrower.
y Credit linked notes
Derivative instruments referencing Debt Assets, being a synthetic obligation between the Company and another party where the repayment of
principal and/or the payment of interest is based on the performance of the obligations under the underlying Debt Assets.
1
Past performance is not an indication of future performance.
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“Royalty Collateral” means, with respect to a Debt Asset, (i) future payments receivable by the Borrower on a Product (or Products) in the form
of royalty payments or other revenue sharing arrangements; or (ii) future distributions receivable by the Borrower based on royalty payments
generated from a Product (or Products); or (iii) both (i) and (ii)“Debt” includes loans, notes, bonds and other debt instruments and securities,
including convertible debt, and Priority Royalty Tranches.
Borrowers will predominantly be domiciled in the US, Europe and Japan, though the Company may also acquire Debt Assets issued by Borrowers
in other jurisdictions.
INVESTMENT RESTRICTIONS AND PORTFOLIO DIVERSIFICATION
The Company will seek to create a diversified portfolio of investments by investing across a range of different forms of Debt Assets issued by a
variety of Borrowers. In particular, the Company will observe the following restrictions when making investments in accordance with its investment
policy:
y no more than 25 per cent. of the Company’s gross assets will be exposed to any single Borrower or investment;
y no more than 35 per cent. of the Company’s gross assets will be invested in Unsecured Debt;
y no more than 15 per cent. of the Company’s gross assets will be invested in equity securities issued by LifeSci Companies; and
y the Company will invest no more than 10 per cent., in aggregate, of gross asset value at the time of acquisition in other listed closed-ended
investment funds.
Each of these investment restrictions will be calculated at the time of each proposed investment. In the event that any of the above limits are
breached at any point after the relevant investment has been made (for instance, as a result of any movements in the value of the Company’s total
assets), there will be no requirement to sell any investment (in whole or in part).
CASH MANAGEMENT
The Company’s uninvested capital may be invested in cash instruments or bank deposits for cash management purposes.
HEDGING
The Company does not propose to enter into any hedging or other derivative arrangements other than as may from time to time be considered
appropriate for the purposes of efficient portfolio management. The Company will not enter into such arrangements for investment purposes.
BUSINESS AND STATUS OF THE COMPANY
The Company is registered in England as a public limited company and is an investment company in accordance with the provisions of Section
833 of the Companies Act 2006.
The principal activity of the Company is to carry on business as an investment trust. The Company intends at all times to conduct its affairs so as
to enable it to qualify as an investment trust for the purposes of Sections 1158/1159 of the Corporation Tax Act 2010 (‘S1158/1159”). The
Directors do not envisage any change in this activity in the foreseeable future.
The Company has been granted approval from HM Revenue & Customs (‘HMRC”) as an investment trust under S1158/1159 and will continue
to be treated as an investment trust company, subject to there being no serious breaches of the conditions for approval. The Directors are of the
opinion that the Company has conducted its affairs for the year ended 31 December 2025 so as to be able to continue to qualify as an investment
trust.
The Company has two wholly-owned subsidiaries, BPCR Limited Partnership and BPCR GP Limited, one indirectly wholly-owned subsidiary, BPCR
Ongdapa Limited and received its 41 per cent. share ownership of LumiraDx Colombia Holdings Limited (“UK Holdco”), via its subsidiary BPCR
Limited Partnership, details of which can be found in Note 14 to the financial statements.
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28
STAKEHOLDER ENGAGEMENT – SECTION 172(1) STATEMENT
OVERVIEW
The Directors’ overarching duty is to promote the success of the Company for the benefit of its shareholders, having regard to the interests of its
stakeholders, as set out in Section 172(1) of the Companies Act 2006 (the “Act”). The Directors have considered each aspect of this section of
the Act and consider that the information set out below is particularly relevant in the context of the Company’s business as an externally managed
investment company which does not have any employees or suppliers.
The importance of stakeholders is taken into account at every Board meeting. All discussions involve careful consideration of the longer-term
consequences of any decisions and their implications for stakeholders.
STAKEHOLDERS
The Board seeks to understand the needs and priorities of the Company’s stakeholders and these are taken into account during all its discussions
and as part of its decision-making. The Board believes that the Company’s key stakeholders comprise its shareholders, clients and service
providers. The section below discusses why these stakeholders are considered of importance to the Company and the actions taken to ensure
that their interests are taken into account. The Company recognises the importance of maintaining high standards of business conduct and seeks
to ensure that these are applied in all of its business dealings and in its engagement with stakeholders. Further information on the impact of the
Company’s operations on the community and the environment is set out on page 39.
The Company’s mechanisms for engaging with its stakeholders are set out below. These are kept under review by the Directors and are discussed
on a regular basis at Board meetings to ensure that they remain effective. The Company is an investment trust and has no employees. It has
therefore not identified employees as a stakeholder group.
For more information on the purpose, culture and values of the Company, and the processes which the Board has put in place to ensure these are
aligned with the Company’s strategy, see the Corporate Governance Statement on page 47.
Image shows the HPV virus attaching to a human epithelial cell.
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29
SHAREHOLDERS
Importance
Continued shareholder support and
engagement are critical to the existence of
the Company and the delivery of its long-term
strategy and engagement with shareholders is
given a high priority by both the Board and
the Investment Manager.
How the Company engages
The Chairman ensures that the Board as a
whole has a clear understanding of the views
of shareholders by receiving regular updates
from the Brokers and Investment Manager.
The Investment Manager and the Company’s
Brokers are in regular contact with major
shareholders and report the results of all
meetings and the views of those shareholders
to the Board on a regular basis. The Investment
Manager provides regular investor updates
and presentations to shareholders, which
the Chairman and the other Directors are
available to attend if required.
The Board considers shareholder relations
as part of the annual Board performance
review process. For further details regarding
the Board performance review see pages 50
to 51.
All shareholders are encouraged to attend
and vote at annual general meetings, during
which the Board and the Investment Manager
will be available to discuss issues affecting the
Company and answer any questions directly.
Further information regarding the 2026 AGM
is detailed on page 46.
Shareholders wishing to raise questions or
concerns directly with the Chairman, Senior
Independent Director or Company Secretary,
outside of the AGM, should do so using the
contact details provided on page 102.
The Chairman of the Board, Harry Hyman and
the Senior Independent Director of the Board,
Duncan Budge, consulted with shareholders
ahead of the 2025 AGM, regarding
the continuation vote, and annually offer
shareholders a meeting without the Investment
Manager present. Although the Company
has been established with an indefinite life,
the Articles provide that a continuation vote
be put to shareholders periodically. The next
continuation vote will be put to shareholders
in 2028.
CLIENTS
Importance
The investments made by the Company
support the large capital needs of its portfolio
companies, supporting their research and
development budgets for life sciences
products and enabling them to achieve their
investment objective.
How the Company engages
The Company’s clients are pharmaceutical
and biotechnology companies within the life
sciences industry to which it provides debt
capital. The Investment Manager is highly
experienced in this area with a strong track
record of meeting the capital needs of its clients.
The Investment Manager meets regularly
with the management teams of current and
prospective investee companies to enhance
relationships and to understand their views
and capital requirements.
The Investment Manager conducted
meetings on 25 March 2025 to
discuss the 2024 annual report results and on
22 September 2025 covering the 2025
half-year results. The focus of these meetings
included reviewing financial highlights for
the periods, providing material portfolio
updates, and discussing portfolio valuation.
The presentations from these meetings are
available on the Company’s website.
The Directors receive updates from the
Investment Manager on the companies within
its investment portfolio at all Board meetings,
and outside of meetings as appropriate.
Further information on the Company’s
engagement with investee companies during
the year is set out on pages 6 to 17 and 29.
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30
SERVICE PROVIDERS
Importance
In order to function as an investment trust on
the London Stock Exchange, the Company
relies on a number of reputable advisers for
support in complying with all relevant legal
and regulatory obligations.
How the Company engages
The Company’s day-to-day operational
functions are delegated to a number of third-
party service providers, each engaged under
separate contracts. The Company’s principal
service providers include the Investment
Manager, Company Secretary, joint Brokers,
Administrator, Legal Adviser, Auditor and the
Registrar.
The Board keeps the ongoing performance
of the Investment Manager under continual
review and conducts an annual appraisal
of the Investment Manager, along with the
performance of all other third-party service
providers in December each year. The Board
maintains constructive working relationships
with the Investment Manager through regular
and open conversations at Board meetings,
and through monthly update meetings. The
Investment Manager has executed the
investment strategy according to the Board’s
expectations and it is the opinion of the
Directors that the continuing appointment of
Pharmakon, as the Investment Manager, is in
the interests of shareholders as a whole.
The Audit and Risk Committee reviews and
evaluates the control environments in place at
each service provider. Further details regarding
the role of the Audit and Risk Committee are
set out on pages 52 to 53.
KEY BOARD DECISIONS TAKEN IN THE YEAR
Appointment of new joint corporate broker
During the year, the Board undertook a process to appoint a new corporate broker. In shaping the search, the Board focused on identifying
a broker with strong sales capability and extensive connections to prospective investors, to complement the expertise of the existing broker,
JPMorgan Cazenove. As an outcome of this process, the Board appointed Investec as joint corporate broker, effective 10 March 2025, to work
alongside JPMorgan Cazenove, and to support the diversification and growth of the share register, as well as to improve liquidity and market
valuation of the Company.
Capital allocation and dividend approval
The Board continued to oversee the Company’s capital allocation, including its approach to dividends and share buybacks. In considering
capital allocation decisions, the Board considered the long-term success of the Company for the benefit of all stakeholders, as well as external
expectations from shareholders and the need to deliver consistent and predictable shareholder returns. As an outcome of these discussions, the
Board approved four dividends for the year ended 31 December 2025, totalling 9.95 cents per share, including two special dividends amounting
to 2.95 cents, thereby delivering consistent income to shareholders.
Appointment of Nigel Reynolds
As part of the Board’s ongoing commitment to effective succession planning and the continued refreshment of Board composition, the Board
undertook a search for a non-executive Director in anticipation of the retirement of Mr Colin Bond. The Board considered the skills and experience
required to support the Company’s long-term strategy and governance priorities, as well as the attributes required of an effective Audit and Risk
Committee Chair. This process resulted in the appointment of Mr Nigel Reynolds as a non-executive Director with effect from 1 January 2026.
MrReynolds will succeed Mr Bond as Chair of the Audit and Risk Committee following the Company’s AGM in June 2026, supporting an orderly
transition and ensuring the continued effectiveness of the Board and its Committees.
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31
KEY PERFORMANCE INDICATORS
The Company assesses its performance in meeting its investment objectives using the following Key Performance Indicators (“KPIs”):
NAV PERFORMANCE
1
The NAV at 31 December 2025 was $1.0192 per Share compared to $0.9963 per Share at 31 December 2024. The dividend yield at
31December 2025 was 10.9%, including dividends of 9.95 cents, compared to a dividend yield of 11.5%, including dividends of 10.18 cents,
in 2024.
A full description of the Company’s performance for the year ended 31December 2025 is included in the Investment Manager’s Report on
pages 6 to17.
SHARE PRICE RETURN
1
The Company’s Share price at 31December 2025 was $0.9160, compared to $0.8840 at 31 December 2024, giving a return for the
calendar year of 3.62percent.
SHARE PRICE DISCOUNT/PREMIUM TO NAV PERSHARE
Under the terms of the DCM, described in the Company’s Prospectuses dated 1March 2017 and 14March 2018, if the shares of the Company
trade at a discount greater than 5per cent. over a three-month period (the “First Trigger”), the Company was required to apply up to 50per cent.
of proceeds from debt repayments in purchasing Company shares until such time that the two-week discount is less than 1per cent. In addition, if
the discount is greater than 10per cent. over a six-month period (the “Second Trigger”), the Company was required to apply up to 100per cent.
of proceeds from debt repayments until such time that the two-week discount is less than 1per cent. If the Company’s shares trade at a discount
in excess of 10per cent. to the net asset value per share over a 12month rolling period, a general meeting and continuation resolution under the
DCM istriggered.
On 7November 2022, the DCM was updated so that the trigger levels remain at previous levels but provide for greater flexibility as to when the
Company can freely deploy capital:
• The First Trigger would remain at a 5per cent. discount to NAV and the Company would be required to apply 50per cent. of the principal
being returned to repurchase shares until such time that the discount to NAV over a two-week period is less than 5per cent. (compared with
less than 1per cent.previously).
• The Second Trigger would remain at a 10per cent. discount to NAV and the Company would be required to apply 100per cent. of
the principal being returned to repurchase shares until such time that the discount to NAV over a two-week period is less than 5per cent.
(compared with less than 1per cent.previously).
On 27March 2024, the DCM was updated, in order to enable the Company to participate in future deals. Under the updated DCM, the
Company was required to use up to an additional $50 million for the remainder of calendar year 2024, on top of repurchases made in 2024 up
until the DCM update, to repurchase shares until such time that the discount to NAV over a two-week period is less than 5per cent. During 2024,
the DCM was triggered, and the Company was required to use its capital to repurchase shares. For the calendar year 2025, the Company used
$50.3 million to buy backshares.
ONGOING CHARGES
The Company’s ongoing charges ratio is shown in the tablebelow.
Year ended
31December
2025
%
Year ended
31December
2024
%
Ongoing charges excluding performance fee
2
1.2 1.2
Performance fee 1.3 1.1
Ongoing charges including performance fee 2.5 2.3
DIVIDENDS
Dividend payments totaling 9.95 cents per Ordinary Share, including two special dividends totaling 2.95 cents have been paid in respect to the
year ended 31December 2025. A dividend was paid in respect of the last quarter of 2025 totaling 3.20 cents per Ordinary Share, including a
special of 1.45 cents on 20March 2026.
1
1
Past performance is not an indication of futureperformance.
2
Ongoing charges are the Company’s expenses (excluding performance fees) expressed as a percentage of its average monthly net assets and follow the AIC recommendedmethodology.
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RISK MANAGEMENT AND THE INTERNAL CONTROL ENVIRONMENT
The role of the Board
The Board has in place an ongoing process for the identification, assessment and monitoring of principal and emerging risks. The Company’s risk
register summarises the Company’s principal and emerging risks and the mitigating actions in place, and forms a key component of the Company’s
risk management framework. The Board is aware of the obligation required under Provision 29 of the UK Code and expects to be fully compliant
as at 31December 2026.
The Board has undertaken a robust assessment of both the principal and emerging risks facing the Company, with the assistance of the Audit
and Risk Committee, and as part of this review, has assessed the effectiveness of the Company’s risk management and internal control systems.
During the course of its review in respect of the year ended 31December 2025, the Board has not identified, nor been advised of any failings or
weaknesses which it has determined to be of a material nature. The principal risks and uncertainties which the Company faces are set outbelow.
Principal and emerging risks and uncertainties
The Board of Directors has overall responsibility for risk management and internal control of the Company. The Board recognises that risk is
inherent in the operation of the Company and that effective risk management is key to the success of the organisation. The Board has delegated
responsibility for the assurance of the risk management process and the review of mitigating controls to the Audit and RiskCommittee. The Board
reviews the Investment Managers reports which will include geopolitical, regulatory and sector specific developments affecting credit markets
and the life sciences industry. The Investment Manager regularly engages with borrowers on market updates and new developments. In addition,
the Audit and Risk Committee and the Board rely on external advisor input and general commentary of financial markets including interest rate
movements, merger and acquisition activity, global equity issuances and other conditions that may impact the Company’s sector.
The principal risks and the Company’s policies for managing these risks are set out below and the policy and practice with regard to financial
instruments are summarised in Note16 to the financialstatements.
There were no changes to these risks in the current year or at the date of thisreport.
Risk Description and mitigation
Failure to achieve target
returns
The target returns are targets only and are based on financial projections that are themselves based on
assumptions regarding market conditions, economic environment, availability of investment opportunities
and investment-specific assumptions that may not be consistent with conditions in thefuture.
The Company seeks to achieve its investment objective predominantly through direct or indirect
exposure to debt assets. Debt assets typically comprise royalty debt instruments, priority royalty
tranches, senior secured debt, unsecured debt and credit-linked notes. A variety of factors, including
lack of attractive investment opportunities, defaults and prepayments under debt assets, inability of the
Company to obtain debt at an appropriate rate, changes in the life sciences industry, exchange rates,
government regulations, the non-performance (or underperformance) of any life sciences product (or
any life sciences company) could adversely impact the Company’s ability to achieve its investment
objective and deliver the target returns. A failure by the Company to achieve its target returns could
adversely impact the value of the Shares and lead to a loss ofinvestment.
The Company has an investment policy to achieve a balanced investment with a diversified asset base
and has investment restrictions in place to limit exposure to potential risk factors. These factors enable
the Company to build a diversified portfolio that should deliver returns that are in line with its stated
targetreturn.
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The success of the Company
depends on the ability and
expertise of the Investment
Manager
In accordance with the Investment Management Agreement, the Investment Manager is responsible for
the investment management of the Company’s assets. The Company does not have its own employees
and all of its Directors are appointed on a non-executive basis. All investment and asset management
decisions are made by the Investment Manager (or any delegates thereof) and not by the Company
or the Directors and, accordingly, the Company is completely reliant upon, and its success depends
on, the Investment Manager and its personnel, services and resources. The Investment Manager is
required, under the terms of the Investment Management Agreement, to perform in accordance with
the Service Standard. The Investment Manager does not submit individual investment decisions to the
Board for approval and the Board does not supervise the due diligence performed by the Investment
Manager. As part of its asset management decisions, the Investment Manager may from time to time
make commitments for future investments for which the Company may need to raise funds in the future
by issuing equity and/or debt or by selling all or part of other investments to raiseliquidity.
The Company is entitled to terminate the Investment Management Agreement if the Investment Manager
has (i)committed fraud, gross negligence or wilful misconduct in the performance of its obligations
under the Investment Management Agreement, or (ii)breached its obligations under the Investment
Management Agreement, and the Company is reasonably likely to suffer a loss arising directly or
indirectly out of or in connection with such breach of an amount equal to or greater than 10per cent. of
the NAV as at the date of the breach. The Investment Management Agreement may also be terminated
at the Company’s discretion on not less than six months’ notice to the InvestmentManager.
Under the terms of the Investment Management Agreement, the Investment Manager is only liable
to the Company (and will only lose its indemnity) if it has committed fraud, gross negligence or wilful
misconduct or acted in bad faith, or knowingly violated applicable securities laws. The performance
of the Company is dependent on the diligence, skill and judgement of certain key individuals at the
Investment Manager, including Pedro Gonzalez de Cosio and other senior investment professionals
and the information and investments’ pipeline generated through their business development efforts.
On the occurrence of a Key Person Event (as defined in the Investment Management Agreement), the
Company may be entitled to terminate the Investment Management Agreement with immediate effect
(subject to the Investment Manager’s right to find an appropriate replacement to be approved by the
Board (such approval not to be unreasonably withheld or delayed) within 180days)).
However, if the Company elects to exercise this right, it would be required to pay the Investment
Manager a termination fee equal to either 1per cent. or 2per cent. of the invested NAV (depending
on the reason for the Key Person Event), as at the date of such termination. If the Company elects not to
exercise this right, the precise impact of a Key Person Event on the ability of the Company to achieve its
investment objective and target returns cannot be determined and would depend inter alia on the ability
of the Investment Manager to recruit individuals of similar experience, expertise and calibre. There can
be no guarantee that the Investment Manager would be able to do so and this could adversely affect
the ability of the Company to meet its investment objective and target returns and may adversely affect
the NAV and Shareholder returns and result in a substantial loss of a Shareholder’sinvestment.
The Investment Manager has extensive expertise and a track record of successfully investing in debt and
other cash flows backed by life sciences products. The Investment Management Agreement provides
attractive incentives for the Investment Manager to perform prudently and in the best interests of the
Company. In addition, the Investment Manager and its affiliates own approximately 2per cent. of the
Company as at 31December 2025, creating a strong alignment of interests between the Investment
Manager and its affiliates and Shareholders of theCompany.
STRATEGIC REPORT
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
34
The Company may from time
to time commit to make future
investments that exceed its
current liquidity
From time to time, the Company may commit to make future investments for which the Company
will need to raise funds by issuing equity and/or debt, or by selling all or part of other investments.
Investment opportunities may require the Company to fund transactions in two or more tranches, with
the later tranches to be funded six or more months in the future. Refusing to offer such later tranches
would decrease the attractiveness of the Company’s investment proposals and harm the Company’s
ability to successfully deploy its capital. Requiring the Company to maintain low-yielding cash balances
sufficient to fund all such later tranches at the time of the initial commitment would decrease the average
yield on the Company’s assets, adversely impacting the returns to investors, and may also result in
missed investment opportunities. However, in order to fund all such later tranches, the Company could
be forced to issue debt, sell assets or renegotiate with the party to which it has committed the funding
on unattractive terms. Furthermore, there can be no assurance that the Company will always be able
to raise sufficient liquidity (by issuing equity and/or debt, or by selling investments) to meet its funding
commitments. If the Company were to fail to meet its funding commitments, the Company could be
in breach of its contractual obligations, which could adversely affect the Company’s reputation,
could result in the Company facing legal action from its counterparty, and could adversely affect the
Company’s financialresults.
The Investment Manager believes that the risks associated with such unfunded commitment is
manageable without undue risk. The Investment Manager has extensive expertise in raising debt
secured by cash flows from life sciences products and has extensive relationships with banks and
other financial institutions who can be called on to provide debt financing to the Company in order to
raise liquidity. In addition, the Investment Manager has expertise purchasing and selling life sciences
debt assets in the secondary market and has extensive relationships with the major participants in the
life- sciences debt market who would be the likely purchasers of any assets offered for sale by the
Company in order to raiseliquidity.
As at 31December 2025, the risk associated with unfunded commitments ismanageable. As of year
end, the Company and its financing subsidiary, BPCR Limited Partnership, have a total of $422.3 million
in cash which exceeds its unfunded commitments of $366.7 million.
The Investment Manager’s
ability to source and advise
appropriately on investments
Returns on the shareholders’ investments will depend upon the Investment Manager’s ability to source
and make successful investments on behalf of the Company. There can be no assurance that the
Investment Manager will be able to do so on an ongoing basis. Many investment decisions of the
Investment Manager will depend upon the ability of its employees and agents to obtain relevant
information. There can be no guarantee that such information will be available or, if available, can
be obtained by the Investment Manager and its employees and agents. Furthermore, the Investment
Manager will often be required to make investment decisions without complete information or in
reliance upon information provided by third parties that is impossible or impracticable to verify. For
example, the Investment Manager may not have access to records regarding the complaints received
regarding a given life science product or the results of research and development related to products.
Furthermore, the Company may have to compete for attractive investments with other public or private
entities, or persons, some or all of which may have more capital and resources than theCompany.
These entities may invest in potential investments before the Company is able to do so or their offers
may drive up the prices of potential investments, thereby potentially lowering returns and, in some cases,
rendering them unsuitable for the Company. An inability to source investments would have a material
adverse effect on the Company’s profitability, its ability to achieve its target returns and the value of
theShares.
The Investment Manager believes that sourcing investments is one of its competitive advantages.
The Investment Manager’s professionals, together with those at its affiliate RP Management LLC,
accessible through the Shared Services Agreement, have complementary scientific, medical, licensing,
operating, structuring and financial backgrounds which the Investment Manager believes provide a
competitive advantage in sourcing, evaluating, executing and managing credit investments in the life
sciencesindustry.
STRATEGIC REPORT
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
35
There can be no assurance
that the Board will be able to
find a replacement investment
manager if the Investment
Manager resigns
Under the terms of the Investment Management Agreement, the Investment Management Agreement
may be terminated by:the Company on not less than six months’ notice to the Investment Manager. The
Board would, in these circumstances, have to find a replacement investment manager for the Company
and there can be no assurance that a replacement with the necessary skills and experience would be
available and/or could be appointed on terms acceptable to the Company. In this event, the Board
may have to formulate and put forward to Shareholders proposals for the future of the Company which
may include its merger with another investment company, reconstruction or winding up. It is possible
that, following the termination of the Investment Manager’s appointment, the Investment Manager
will continue to have a role in the investment management of certain assets, where a debt asset is
shared with one or more other entity managed by the Investment Manager that continue to retain the
Investment Manager’sservices.
In the event the Investment Manager resigns, the Board will put forward to Shareholders proposals
for the future of the Company which may include its merger with another investment company,
reconstruction or winding up. Entities affiliated with the Investment Manager own approximately 2per
cent. of the Company as at 31December 2025. This affiliate ownership level, coupled with the fact
that the Investment Manager is fairly compensated, provide further incentive for them to remain as
Investment Manager to theCompany.
Concentration in the
Company’s portfolio may
affect the Company’s ability
to achieve its investment
objective
The Company’s published investment policy allows the Company to invest up to 25per cent. of the
Company’s assets in a single debt asset or in debt assets issued to a single borrower. While the
investment limits in the investment policy have been set keeping in mind the debt capital requirements
of the life sciences industry and the investment opportunities available to the Investment Manager, it
is possible that the Company’s portfolio may be significantly concentrated at any given point intime.
Concentration in the Company’s portfolio may increase certain risks to which the Company is subject,
some or all of which may be related to events outside the Company’s control. These would include risks
around the creditworthiness of the relevant borrower, the nature of the debt asset and of any life sciences
product(s) in question. The occurrence of these situations may result in greater volatility in the Company’s
investments and, consequently, its NAV, and may materially and adversely affect the performance
of the Company and the Company’s returns to shareholders. Such increased concentration of the
Company’s assets could also result in greater losses to the Company in adverse market conditions than
would have been the case with a less concentrated portfolio, and have a material adverse effect on
the Company’s financial condition, business, prospects and results of operations and, consequently, the
Company’s NAV and/or the market price of theShares.
STRATEGIC REPORT
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
36
Life sciences products are
subject to intense competition
and various other risks
The biopharmaceutical and pharmaceutical industries are highly competitive and rapidly evolving. The
length of any life sciences product’s commercial life cannot be predicted. There can be no assurance
that the life sciences products will not be rendered obsolete or non-competitive by new products or
improvements made to existing products, either by the current marketer of the life sciences products or
by another marketer. Adverse competition, obsolescence or governmental and regulatory life sciences
policy changes could significantly impact royalty revenues of life sciences products which serve as
the collateral or other security for the repayment of obligations outstanding under the Company’s
investments. If a life sciences product is rendered obsolete or non-competitive by new products or
improvements on existing products or governmental or regulatory action, such developments could
have a material adverse effect on the ability of the borrower under the relevant debt asset to make
payment of interest on, and repayments of the principal of, that debt asset, and consequently could
adversely affect the Company’s performance. If additional side effects or complications are discovered
with respect to a life sciences product, and such life sciences product’s market acceptance is impacted
or it is withdrawn from the market, continuing payments of interest on, and repayment of the principal
of, that debt asset may not be made on time or at all. It is possible that over time side effects or
complications from one or more of the life sciences products could be discovered, and, if such a side
effect or complication posed a serious safety concern, a life sciences product could be withdrawn from
the market, which could adversely affect the ability of the borrower under the relevant debt asset to
make continuing payments of interest on, and repayment of the principal of, that debt asset, in which
case the Company’s ability to make distributions to investors may be materially and adverselyaffected.
Furthermore, if an additional side effect or complication is discovered that does not pose a serious
safety concern, it could nevertheless negatively impact market acceptance and therefore result
in decreased net sales of one or more of the life sciences products, which could adversely affect
the ability of borrowers under the relevant debt asset(s) to make continuing payments of interest on,
and repayment of the principal of, that debt asset(s), in which case the Company’s ability to make
distributions to investors may be materially and adverselyaffected.
The Investment Manager engages in a thorough diligence process before entering into any debt
instrument with the counterparty and interacts with each counterparty as needed to evaluate the status
of its investment on an ongoingbasis.
STRATEGIC REPORT
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
37
Investments in debt obligations
are subject to credit and
interest rate risks
Debt instruments are subject to credit and interest rate risks. Credit risk refers to the likelihood that the
borrower will default in the payment of principal and/or interest on an instrument. Financial strength and
solvency of a borrower are the primary factors influencing credit risk. In addition, lack or inadequacy of
collateral or credit enhancement for a debt asset may affect its credit risk. Credit risk may change over
the life of an instrument. Interest rate risk refers to the risks associated with market changes in interest
rates. Interest rate changes may affect the value of a debt asset indirectly (especially in the case of
fixed rate debt assets) and directly (especially in the case of debt assets whose rates are adjustable). In
general, rising interest rates will negatively impact the price of a fixed rate debt asset and falling interest
rates will have a positive effect on price. Adjustable rate instruments also react to interest rate changes
in a similar manner although generally to a lesser degree (depending, however, on the characteristics
of the reset terms, including the index chosen, frequency of reset and reset caps or floors, among
other factors). Interest rate sensitivity is generally more pronounced and less predictable in instruments
with uncertain payment or prepayment schedules. In addition, interest rate increases generally will
increase the interest carrying costs to the Company (or any entity through which the Company invests)
of leveragedinvestments.
The Company will often seek to be a secured lender for each Debt Asset. However, there is no
guarantee that the relevant borrower will repay the loan or that the collateral will be sufficient to satisfy
the amount owed under the relevant Debt Asset. Credit risk will be assessed on an ongoing basis along
with interest rate risk, and is further mitigated by the Company’s investment policy permitting up to no
more than 25per cent. of the Company’s assets to be invested in a single Debt Asset or in Debt Assets
issued to a single borrower. Interest rate risk can be managed in a variety of ways, including with the
use ofderivatives.
Counterparty risk The Company intends to hold debt assets that will generate an interest payment. There is no guarantee
that any borrower will honour their obligations. The default or insolvency of such borrowers may
substantially affect the Company’s business, financial condition, results of operations, the NAV and
Shareholderreturns.
The Company will often seek to be a secured lender for each Debt Asset. However, there is no
guarantee that the collateral will be sufficient to satisfy the amount owed under the relevant DebtAsset.
Sales of life sciences products
are subject to regulatory
actions that could harm the
Company’s ability to make
distributions to investors
There can be no assurance that any regulatory approvals for indications granted to one or more life
sciences products will not be subsequently revoked or restricted. Such revocation or restriction may
have a material adverse effect on the sales of such products and on the ability of borrowers under the
relevant Debt Asset to make continuing payments of interest on, and repayment of the principal of, that
Debt Asset, in which case the Company’s ability to make distributions to investors may be materially and
adversely affected. Changes in legislation are monitored with the use of third-party legal advisers and
the Investment Manager will maintain awareness of new approvals or revokedapprovals.
STRATEGIC REPORT
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
38
Net asset values published will
be estimates only and may
differ materially from actual
results
Generally, there will be no readily available market for a significant number of the Company’s
investments and hence, the majority of the Company’s investments are not valued based on market-
observableinputs.
The valuations used to calculate the NAV on a monthly basis will be based on the Investment Manager’s
unaudited estimated fair market values of the Company’s investments. It should be noted any such
estimates may vary (in some cases materially) from the results published in the Company’s financial
statements (as the figures are published at different times) and that they, and any NAV figure published,
may vary (in some cases materially) from realised or realisablevalues.
The Investment Manager sends valuations on a monthly basis to the administrator for calculation of
the NAV. The NAV is prepared by the administrator on the basis of information received from the
Investment Manager and, once finalised, is reviewed and approved by a representative of the
Investment Manager. Once approved, the Investment Manager notifies the Board and the NAV is
released to themarket. The Investment Manager notes that there has been no NAV adjustment since
IPO.
Changes in taxation legislation
or practice may adversely
affect the Company and the
tax treatment for Shareholders
investing in the Company
Any change in the Company’s tax status, or in taxation legislation or practice in the UK, US or elsewhere,
could affect the value of the Company’s investments and the Company’s ability to achieve its investment
objective, or alter the post-tax returns to Shareholders. It is the intention of the Directors to conduct the
affairs of the Company so as to satisfy the conditions for approval of the Company by HMRC as an
investment trust under section 1158 of the Corporation Tax Act2010 (as amended) and pursuant
to regulations made under Section 1159 of the Corporation Tax Act2010. However, although the
approval has been obtained, neither the Investment Manager nor the Directors can guarantee that
this approval will be maintained at all times. The Company has been granted approval from HMRC
as an investment trust and will continue to have investment trust status in each subsequent accounting
period, unless the Company fails to meet the requirements to maintain investment trust status, pursuant
to the regulations. For example, it is not possible to guarantee that the Company will remain a non-
close company, which is a requirement to maintain investment trust status, as the Shares are freely
transferable. Failure to maintain investment trust status could, as a result, (inter alia) lead to the Company
being subject to UK tax on its chargeable gains. Existing and potential investors should consult their tax
advisers with respect to their particular tax situations and the tax effects of an investment in theCompany.
Geopolitical Risk The global operating environment remains characterized by elevated geopolitical uncertainty.
Ongoing conflicts between Russia and Ukraine, the war between Israel and Hamas and the Iranian
war contribute to sharp volatility in the global markets. However, the Company does not have any
direct investments with Russia, Ukraine or Iran and has limited manufacturing exposure in Israel.
STRATEGIC REPORT
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
39
GOING CONCERN
The Directors consider that it is appropriate to adopt the going concern basis in preparing the financial statements. After making enquiries, and
bearing in mind the nature of the Company’s business and assets, the Directors consider that the Company has adequate resources to continue
in operational existence for the foreseeable future. In arriving at this conclusion, the Directors have considered the liquidity of the portfolio and
the Company’s ability to meet obligations as they fall due for a period of at least 12months from the date that these financial statements were
approved. As at 31 December 2025, the Company and its financing subsidiary, BPCR Limited Partnership, held cash of $422.3 million, which
exceeds its unfunded commitments of $366.7 million, resulting in net cash of $230.6 million after such commitments. The Directors are therefore
satisfied that the Company has sufficient resources to meet its obligations as they fall due for a period of at least 12 months from the date of
approval of these financial statements.
VIABILITY STATEMENT
The Board has assessed the principal and emerging risks risks facing the Company over a five-year period, including those that would threaten its
business model, future performance, solvency or liquidity. The five-year period was selected to align with the average duration of the Company’s
existing investments. The Board has developed a matrix of risks facing the Company and has put in place certain investment restrictions which are
in line with the Company’s investment objective and policy in order to mitigate these risks as far as practicable. The principal risks which have been
identified, and the steps taken by the Board to mitigate these risks, are presented on pages 32 to38.
The Company believes its borrowing capabilities provide further flexibility and help ensure it is in a position to finance its funding obligations in the
event that internally generated cash flow in the period is insufficient to finance the unfunded portion of a lending commitment. The Board reviews
the Company’s financing arrangements quarterly to ensure that the Company is in a strong position to fund all outstanding commitments on existing
investments as well as being able to finance new investments. In addition, the Board regularly reviews the prospects for the Company’s portfolio
and the pipeline of potential investment opportunities which provide comfort that the Company is able to continue to finance its activities for the
medium-termfuture.
Based on this assessment, the Directors have a reasonable expectation that the Company will be able to continue in operation and meet its
liabilities as they fall due over the next five-yearperiod.
ENVIRONMENTAL, HUMAN RIGHTS, EMPLOYEE, SOCIAL AND COMMUNITY ISSUES
The Board recognises the requirement under the Companies Act 2006 to detail information about employees, human rights, environmental
and community issues, including information about any policies it has in relation to these matters and the effectiveness of these policies. These
requirements do not apply directly to the Company as it has no employees, all the Directors are non-executive and it has outsourced all its functions
to third-party service providers. The Company has therefore not reported further in respect of theseprovisions.
While the Company is not within the scope of the Modern Slavery Act2015 and it is not, therefore, obliged to make a slavery and human
trafficking statement, the Company considers its supply chains to be of low risk as its principal service providers are the professional advisers set out
in the Corporate Information section on page 101. Further information on the Company’s anti-bribery and corruption policy is set out on page46.
There are seven Directors, five male and two female. Further information on the composition and operation of the Board is detailed on pages 42
to51.
This Strategic Report has been approved by the Board and signed on its behalf by
Harry Hyman
Chairman
23 March 2026
40
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
GOVERNANCE
41
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
GOVERNANCE
42
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
BOARD OF DIRECTORS
DUNCAN BUDGE
Senior Independent Director
Duncan Budge is a non-executive Director of Patria Private Equity Trust
Plc, Lowland Investment Company Plc and Asset Value Investors Limited.
He was previously the Chairman of Dunedin Enterprise Investment
Trust plc and Artemis Alpha Trust plc from 2014 to 2023, J. Rothschild
Capital Management from 1988 to 2012 and a director and chief
operating officer of RIT Capital Partners plc from 1995 to 2011. After
graduating from the University of Oxford, he spent six years with Lazard
Brothers.
Mr Budge was appointed as a Director of the Company on 24October
2016 and as Senior Independent Director on 16September 2020.
STEPHANIE LÉOUZON
Non-Executive Director
Stephanie Léouzon has had over 30 years experience as a Health
Care Investment Banker, and is a Managing Director and Vice Chair of
European Healthcare Investment Banking at Stifel. She has worked on
over 100 strategic and financing transactions in the biopharmaceutical
industry, with an aggregate value of over $75 billion. Mrs Léouzon
joined Stifel in 2024 when Stifel acquired Torreya. She joined Torreya
in 2011, and served as Partner and Head of Europe. Previously, she
was a Managing Director and Senior Adviser in Healthcare Investment
Banking at Credit Suisse in London. She has also worked at Salomon
Brothers, as a Director of Healthcare Investment Banking, and as a Vice
President in the Investment Banking divisions of JP Morgan and Lehman
Brothers in New York. She was previously a non-executive director of
Immunovaccine Inc and Endotis Pharma SA.
Mrs Leouzon was appointed as a Director of the Company on
5December 2018.
COLIN BOND
Chairman of the Audit and Risk Committee
Colin Bond was the Chief Financial Officer of the pharmaceutical
company Sandoz AG until the end of June 2024. He was previously
Chief Financial Officer of Vifor Pharma from 2016 to 2022 and he
was the Chief Financial Officer of Evotec AG from 2010 to 2016.
During his early career, he worked as a pharmacist, auditor, and
management consultant for Procter & Gamble, Arthur Andersen, and
PricewaterhouseCoopers LLP, respectively. He holds a university degree
in Pharmacy from the University of Aston (Birmingham) and an M.B.A.
degree from London Business School. He is a fellow of the Institute of
Chartered Accountants in England and Wales and a member of the
Royal Pharmaceutical Society. Mr Bond is a citizen of Great Britain and
Switzerland.
Mr Bond is a non-executive Director of Oxford Biomedica Plc, Faron
Pharmaceuticals Ltd, One Source Specialty Pharma Limited, Agomab
Therapeutics NV and Medichem S.A and member of the Supervisory
Board of FormyconAG.
Mr Bond was appointed as a Director of the Company on
15November 2016.
HARRY HYMAN
Chairman
Harry Hyman is the founder and the non-executive Chair of Primary
Health Properties PLC (“PHP”), a FTSE 250 Index company that
specialises in the ownership of property leased on a long-term basis to
healthcare providers. After graduating from Christ’s College Cambridge,
Mr Hyman qualified as a chartered accountant with Price Waterhouse.
In 1983 he joined Baltic PLC where he was deputy managing director,
finance director and company secretary. He left to establish PHP and
Nexus InvestCo in February 1994. Mr Hyman is a Director of Knife and
Fork Holdings, and is the founder of The International Opera Awards.
He has been a non-executive director of a number of listed investment
trusts.
Mr Hyman was appointed as a Director of the Company on 27February
2017 and as Chairman of the Board on 16 September 2020.
All Directors in office at the date of this report are
non-executive and independent of the Investment Manager
BOARD OF DIRECTORS continued
GOVERNANCE
43
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
SAPNA SHAH
Non-Executive Director
Sapna Shah has over 20 years of investment banking experience advising
international companies, including listed REITs and investment companies,
on mergers and acquisitions, IPOs and equity capital market transactions.
Ms Shah is the senior independent director of Supermarket Income REIT
plc and chair of its nominations committee, a non-executive director of
BlackRock Greater Europe Investment Trust plc, Pantheon Infrastructure
plc and non-executive Chair and member of the remuneration committee
of the Association of Investment Companies (“AIC”). She is a Senior
Adviser at Panmure Liberum and prior to this held senior investment
banking roles at UBS AG, Oriel Securities (now Stifel Nicolaus Europe)
and Cenkos Securities (now Cavendish Financial). She has previously
served on the advisory committee for a private solar energy company.
Ms Shah was appointed as a Director of the Company on 22 March
2023.
ROLF SODERSTROM
Non-Executive Director
Rolf Soderstrom is an External Independent Director of Nxera
Pharma, which is listed on the Tokyo Stock Exchange. His previous
roles include Executive Partner and Chief Financial Officer at
Syncona Investment Management Limited, a listed Lifescience
venture fund. He was Chief Financial Officer of BTG PLC where he
helped implement and execute a transformational growth strategy
culminating in a sale to Boston Scientific for $4.2bn. Other previous
roles include Chief Financial Officer at Protherics PLC and senior
finance roles in Cobham PLC, Cable & Wireless PLC and PwC. He
received a BA honours degree in History from University College
London and is a member of the Institute of Chartered Accountants
of England and Wales.
Mr Soderstrom was appointed as a Director of the Company on
16September 2020.
NIGEL REYNOLDS
Non-Executive Director
Nigel Reynolds has over 30 years of accounting and finance experience
advising both listed and private companies. He was a partner at PwC for
20 years specialising in audit, transaction services and capital markets
work. During his time at PwC, he led its London Assurance practice
for 5 years, private equity portfolio company practice and was the
relationship partner for various UK listed and international companies
including companies in healthcare and investment trusts. Over his career
he has also advised companies on strategy, M&A, internal audit and tax
and has overseen technology, sustainability, and other large projects for
PwC clients.
Mr Reynolds is a non-executive Director at Simmons + Simmons, an angel
investor in several growth companies and a member of the Institute of
Chartered Accountants in England & Wales.
Mr Reynolds was appointed as a Director of the Company on 1January
2026.
GOVERNANCE
44
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
DIRECTORS’ REPORT
The Directors are pleased to present the Annual Report and audited
financial statements for the year ended 31 December 2025. The
Directors’ Report and the Strategic Report should be read together,
as they contain the information required to be included in the
management report for the purposes of DTR 4.1.8R of the Financial
Conduct Authority’s Disclosure Guidance and Transparency Rules.
The Corporate Governance Statement (including the Audit and Risk
Committee report and the Remuneration report) provides additional
context to these disclosures.
DIRECTORS
The Directors of the Company who were in office during the year
and up to the date of signing the financial statements are shown on
pages42 to 43.
The general powers of the Directors are set out in the Company’s
Articles of Association, which provides that the business of the Company
shall be managed by the Board, which may exercise all powers of
the Company, subject to any limitations imposed by the Articles and
any directions given by special resolution of the Company. The rules
concerning the appointment and replacement of Directors are also set
out in the Articles and the Companies Act 2006. The Articles can be
amended by shareholders at a General Meeting.
SHARE CAPITAL
An allotment authority for the issuance of up to 112,932,777 ordinary
or C shares was passed at the Company’s Annual General Meeting
(“AGM”) held on 9 June 2025. This authority will expire at the
conclusion of, and renewal will be sought at, the AGM to be held in
June 2026. No shares were issued during the year.
At the AGM held on 9 June 2025, the Company was granted authority
to purchase up to 14.99 percent. of the Company’s Ordinary Share
capital in issue at that date, amounting to 185,505,277 Ordinary
Shares in issue. This authority will expire at the conclusion of, and
renewal will be sought at, the Annual General Meeting to be held in
June 2026.
As set out in the Chairman’s Statement on page 4, during the year,
the Company’s discount control mechanism was triggered and the
Company was required to use its capital to repurchase shares. During
2025, 56,828,879 shares of $0.01 were bought back at a total cost
of $50.3million and are held in treasury. This represented 4.14per
cent. of the issued share capital as at 31December 2025. No shares
were purchased for cancellation.
At 31December 2025, and as at the date of this report, there are
1,373,932,067 Ordinary Shares in issue. As at 31December 2025
there were 244,704,289 Ordinary Shares held in treasury. Since
31 December 2025, no further shares have been repurchased.
Ordinary shares held in Treasury will only be reissued at a premium to
the prevailing net asset value per share at the time of issue. The decision
as to whether to reissue any treasury shares will be at the discretion of
the Board and within the Directors’ authority to allot shares.
At general meetings of the Company, shareholders are entitled to one
vote on a show of hands and to one vote for every share held on a
poll. Shares held in treasury do not carry voting rights. The total voting
rights of the Company at 31December 2025 was 1,129,227,778
and there has been no change up to the date of this report.
Further information on the Company’s share capital is set out in
Note13 to the financial statements.
SUBSTANTIAL SHAREHOLDINGS
The Directors have been informed of the following notifiable interests in
the Company’s voting rights as at 31December 2025:
Number of
Ordinary Shares
% of
voting rights
Newton Investment Management
Limited
136,378,417 11.50
Adage Capital Partners GP LLC 112,712,381 9.97
Interseguro Compañía de Seguros S.A. 72,791,326 6 .14
Sarasin & Partners LLP 70,476,921
5.94
M&G plc 67,215,104 5.67
Inteligo Bank Limited 66,593,210 5 . 61
This information was correct at the date of notification. It should be noted
that these holdings are likely to have changed since the Company was
notified; however, notification of any change is not required until the
next notifiable threshold is crossed.
The Company has not been informed of any changes to the notifiable
interests between 31December 2025 and the date of this report.
INFORMATION ABOUT SECURITIES CARRYING
VOTING RIGHTS
The following information is disclosed in accordance with The Large
and Medium-sized Companies and Groups (Accounts and Reports)
Regulations 2008 and DTR 7.2.6 of the Financial Conduct Authority’s
Disclosure Guidance and Transparency Rules:
• the Company’s capital structure and voting rights and details of
the substantial shareholders in the Company are set in Note13
to the financial statements and above;
• the giving of powers to issue or buy back the Company’s Shares
requires an appropriate resolution to be passed by shareholders;
and
• there are no restrictions concerning the transfer of securities in
the Company or on voting rights; no special rights with regard to
control attached to securities and no agreements between holders
of securities regarding their transfer known to the Company.
DIVIDENDS AND DIVIDEND POLICY
Dividends paid in respect of the year ended 31December 2025 are
set out on in Note 6 to the financial statements.
The Company pays dividends in US dollars or GBP Sterling (at the
shareholder’s election) on a quarterly basis. The Company may, where
the Directors consider it appropriate, use the special distributable
DIRECTORS’ REPORT continued
GOVERNANCE
45
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
reserve created by the cancellation of its Share premium account to
pay dividends.
The Company targets an annual dividend yield of 7 cents plus special
on the Ordinary Shares in issue (calculated by reference to the issue
price at IPO), together with a net total return on NAV of 8-9per cent.
per annum on the Ordinary Shares in issue in the medium term.
SIGNIFICANT AGREEMENTS
The Company is not a party to any significant agreements that would
take effect, alter or terminate on a change of control of the Group.
FINANCIAL RISK MANAGEMENT
The principal risks and the Company’s policies for managing these risks
are set out in the Strategic Overview on pages 32 to 38 and Note16
to the financial statements.
CORPORATE GOVERNANCE
The Corporate Governance Statement on page47 forms part of the
Directors’ Report.
STAKEHOLDER ENGAGEMENT
While the Company has no employees, suppliers or customers,
the Directors give regular consideration to the need to foster the
Company’s business relationships with its stakeholders, in particular
with clients, shareholders and service providers. The effect of this
consideration upon the principal decisions taken by the Company
during the financial year is set out in further detail in the Strategic Report
on pages28 to 30.
STREAMLINED ENERGY AND CARBON REPORTING
The Company is an investment trust, with neither employees nor
premises. It has no direct greenhouse gas emissions to report from
its operations nor does it have responsibility for any other emissions
producing sources under the Companies Act 2006 (Strategic Report
and Directors’ Report) Regulations 2013, including those within
the Company’s underlying investment portfolio. Consequently, the
Company consumed less than 40,000 kWh of energy during the year
in respect of which the Directors’ Report is prepared and is therefore
exempt from the disclosures required under the Streamlined Energy
and Carbon Reporting criteria.
REQUIREMENTS OF THE LISTING RULES
UKLR 6.6.4 (R) requires the Company to include specified information
in a single identifiable section of the Annual Report or a cross reference
table indicating where the information is set out. The Directors confirm
that no disclosures are required in this respect.
The Listing Rules require companies to disclose in their annual report
whether they have reported on how climate change affects their
business in a manner consistent with the recommendations of the
Task Force on Climate-related Financial Disclosures (‘TCFD’), and
to provide an explanation and other information if they are unable to
do so. The Company is not required to disclose this information under
UKLR 11.4.23 (R).
CONSUMER DUTY
The FCA’s Consumer Duty rules aim to improve outcomes for retail
customers across the financial services industry. The Board has
reviewed the investment managers annual assessment of consumer
duty obligations and is satisfied they have been met.
MANAGEMENT ARRANGEMENTS
The Company has appointed Pharmakon Advisors LP, a limited
partnership established under the laws of the State of Delaware, USA
as its Investment Manager and acting Alternative Investment Fund
Manager (“AIFM”) for the purposes of the Alternative Investment
Fund Managers Directive. The Investment Manager is a registered
investment adviser under the Advisers Act and is regulated by the SEC.
The Company and the Investment Manager have entered into an
Investment Management Agreement dated 1 March 2017, as
amended on 14 March 2018, 24 May 2018 and 19 September
2018, pursuant to which the Investment Manager has been given
responsibility, subject to the overall supervision of the Board, for
the active investment management of the Debt Assets and all other
investments of the Company from time to time, including sourcing
and advising on investment opportunities and proposals which are
in accordance with the Company’s investment objective and policy.
The Investment Management Agreement may be terminated by:
(a)the Investment Manager on not less than six months’ notice to the
Company; or (b)the Company on not less than six months’ notice to
the Investment Manager.
Details about the management and performance fee can be found in
Note4 to the financial statements.
The Investment Manager consists of three principals: Pedro Gonzalez
de Cosio, Pablo Legorreta and Martin Friedman. In addition, the
Investment Manager may draw on the expertise of certain employees
of its affiliate, RP Management LLC. For these purposes, the Investment
Manager and RP Management LLC entered into a Shared Services
Agreement as of 1January 2016, whereby RP Management LLC may
provide the services of its research, legal and compliance, and finance
teams to the Investment Manager.
Under the Shared Services Agreement, each of RP Management LLC
and the Investment Manager has agreed to reimburse the other for
reasonable internal and third-party expenses incurred by the other
on its behalf, or for its benefit, as a result of rendering such services.
Such expenses include (without limitation) business development,
due diligence, legal, consulting, compliance, research and similar
expenses.
Under the Shared Services Agreement, subject to each party’s fiduciary
duties to its clients, each of RP Management LLC and the Investment
Manager has agreed to refer to the other any business opportunities
that fit the other’s investment objectives. To the extent that a business
opportunity involves both equity and debt-like financing transactions,
each of RP Management LLC and the Investment Manager shall be free
DIRECTORS’ REPORT continued
GOVERNANCE
46
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
to negotiate an offer aligning with its own investment objectives and is
under no obligation to take the other party’s investment objectives into
consideration during such a negotiation.
The Shared Services Agreement is governed by the laws of the State
of New York and may be terminated by either RP Management LLC or
the Investment Manager upon 30 days’ written notice.
INSURANCE AND INDEMNITY PROVISIONS
The Board has agreed arrangements whereby Directors may take
independent professional advice in the furtherance of their duties.
The Company has Directors’ and Officers’ liability insurance and
professional indemnity insurance to cover legal defence costs and
public offering of securities insurance in place in respect of both the
IPO and the Placing Programme. Under the Company’s Articles, the
Directors are provided, subject to the provisions of UK legislation, with
an indemnity in respect of liabilities which they may sustain or incur in
connection with their appointment. This indemnity was in force during
the year and remains in force as at the date of this report. Apart from
this, there are no third-party indemnity provisions in place for the
Directors.
ANTI-BRIBERY AND CORRUPTION
The Company has reviewed the statements regarding compliance with
the Bribery Act 2010 by the Company’s Investment Manager and
service providers. These statements are reviewed regularly by the Audit
and Risk Committee.
FUTURE DEVELOPMENTS
The effects of geopolitical and social risks may have economic
consequences that extend beyond the short term. The Company does
not have any direct investments with Russia, Ukraine or Iran and has
limited manufacturing exposure in Israel. We will continue to monitor
the situation and will inform shareholders of any material changes to
this assessment. Further details on the outlook of the Company are set
out in the Chairman’s Statement on page4.
EVENTS SUBSEQUENT TO THE YEAR END
Details of events subsequent to the year end date can be found in
Note19 to the financial statements.
AUDIT INFORMATION
The Directors who held office at the date of approval of the Directors’
Report confirm that, so far as they are aware, there is no relevant audit
information of which the Company’s Auditor is unaware; and each
Director has taken all reasonable steps that he/she ought to have
taken as a Director to make himself/herself aware of any relevant
audit information and to establish that the Company’s Auditor is aware
of that information.
AUDITOR
Ernst & Young, Chartered Accountants will be proposed for re-
appointment at the AGM. In accordance with s.489(4) of the
Companies Act 2006, resolutions to determine remuneration for the
Auditor are to be agreed at the AGM. Further information on the
appointment of the Auditor can be found on page53.
AGM
The Company’s AGM will be held in June 2026. The notice of this
meeting is included with this mailing and will also be uploaded to the
Company’s website www.bpcruk.com.
By order of the Board
MUFG Corporate Governance Limited
Company Secretary
23 March 2026
GOVERNANCE
47
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
Corporate Governance Statement
This Corporate Governance Statement forms part of the Directors’
Report.
INTRODUCTION FROM THE CHAIRMAN
I am pleased to introduce this year’s Corporate Governance
Statement. In this statement, the Company reports on its compliance
with the 2024 AIC Code of Corporate Governance (the “AIC Code”)
and sets out how the Board has operated during the past year. This
is the Company’s first year complying with 2024 AIC Code, with the
exception of provision 34 (provision 29 of the 2024 UK Corporate
Governance Code (the “UK Code”)) which is applicable for financial
years on or after 1January 2026. The Board has taken a number of
steps throughout the year to ensure compliance with the AIC Code,
including updating its Committee Terms of Reference and completing a
gap analysis exercise from the 2019 to 2024 AIC Code. The Board
has also commenced readiness activities to prepare to comply with
the new provision 34 on Internal Controls and further information on
this can be found on pages52 and 53. The Board is accountable to
shareholders for the governance of the Company and is committed
to maintaining the highest standard of corporate governance for the
long-term sustainable success of the Company.
COMPLIANCE WITH THE AIC CODE
The Company reviews its standards of governance against the
principles and recommendations of the AIC Code. The Board
considers that reporting against the principles and recommendations
of the AIC Code provides better information to shareholders as it
addresses all the principles set out in the UK Code, as well as setting
out additional principles and recommendations on issues that are of
specific relevance to investment trusts, and is endorsed by the Financial
Reporting Council (the “FRC”). The terms of the FRC’s endorsement
mean that AIC members who report against the AIC Code meet
fully their obligations under the UK Code and the related disclosure
requirements contained in the Listing Rules of the Financial Conduct
Authority. A copy of the AIC Code can be found at www . theaic.co.uk.
A copy of the UK Code can be obtained at www.frc.org.uk.
The Board recognises the importance of a strong corporate
governance culture and has established a governance framework
which it considers to be appropriate to the business of the Company
and to contribute to the effective delivery of the Company’s strategy.
The UK Code includes provisions relating to:
• the role of the chief executive; and
• executive directors’ remuneration.
For the reasons explained in the AIC Code, the Board considers that
these provisions are not relevant to the Company, being an externally
managed investment company. The Company has therefore not
reported further in respect of these provisions. The Board has reviewed
the principles and recommendations of the AIC Code and considers
that it has complied throughout the year, except as disclosed below:
• Provision 24: Directors are not appointed for a specific term as
all Directors are non-executive and the Company has adopted
a policy of all Directors, including the Chairman, standing for
annual re-election. The Board seeks to regularly refresh the Board
by recruiting new Directors and has determined that no further
policy on tenure is required.
• Provision 22 and 37: Given the structure and size of the Board,
the Board does not consider it necessary to appoint separate
nomination, remuneration or management engagement
committees. This is however, kept under annual review. The roles
and responsibilities normally reserved for these committees are
matters for the full Board.
BOARD OF DIRECTORS
Under the leadership of the Chairman, the Board of Directors is
collectively responsible for the long-term sustainable success of the
Company, generating value for shareholders and contributing to wider
society. It provides overall leadership, sets the strategic aims of the
Company and ensures that the necessary resources are in place for the
Company to meet its objectives and fulfil its obligations to shareholders
within a framework of high standards of corporate governance
and effective internal controls. The Directors are responsible for the
determination of the Company’s investment policy and investment
strategy and have overall responsibility for the Company’s activities,
including the review of investment activity and performance and the
control and supervision of the Investment Manager.
The Board consisted of six independent non-executive Directors as
at 31 December 2025. Mr Nigel Reynolds was appointed as an
independent non-executive Director of the Board on 1January 2026,
and as at the date of this report the Board consists of seven independent
non-executive Directors. It seeks to ensure that it has an appropriate
balance of skills and experience, and considers that, collectively,
it has substantial recent and relevant experience of investment trusts
and financial and public company management. The Chairman of the
Audit and Risk Committee, Mr Bond, has recent and relevant financial
experience as set out in his biography on page42.
The terms and conditions of the appointment of the Directors are
formalised in letters of appointment, copies of which are available
for inspection from the Company’s registered office. None of the
Directors has a contract of service with the Company nor has there
been any other contract or arrangement between the Company and
any Director at any time during the year. Directors are not entitled to
any compensation for loss of office.
SUCCESSION PLANNING AND RECRUITMENT
The Board does not have a separate Nomination Committee, and as
such succession planning is the responsibility of the full Board, and was
a key focus throughout the year. The Board maintains a Board tenure
table to support with forward planning for anticipated retirements
and to ensure adequate time is available for a smooth transition of
knowledge and responsibilities from outgoing Board members.
As a result of several directors having been appointed at the time of
IPO, Mr Bond, Mr Budge and Mr Hyman have all reached their nine
year tenure within a close timeframe.
Corporate Governance Statement continued
GOVERNANCE
48
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
As noted in last year’s report, Mr Bond will retire following the
Company’s 2026 AGM. The Board commenced a formal recruitment
process during the year, to identify a replacement for Mr Bond.
The Company engaged Nurole, an independent external search
consultancy with no connection to the Company or its Directors,
and also utilised each Directors’ professional networks. Through this
combined process, a suitable candidate was identified and evaluated
through the Company’s standard assessment and interview process.
After careful consideration, the Board approved the appointment of Mr
Nigel Reynolds, effective 1January 2026. Mr Reynolds will succeed
Mr Bond as Chair of the Audit and Risk Committee upon his retirement
later in the year. Mr Reynolds has substantial and significant financial
experience, as detailed in his biography on page43. MrReynolds
will work closely with Mr Bond throughout the first half of 2026 to
ensure an orderly handover of the Audit and Risk Committee Chair.
MrReynolds will stand for election at the Company’s 2026 AGM,
whilst Mr Bond will not seek re-election.
Mr Budge, Senior Independent Director, will also retire following the
Company’s 2026 AGM and will not seek re-election at this meeting.
Ms Shah will succeed Mr Budge as the Senior Independent Director.
The Board has also commenced a recruitment process for an additional
non-executive Director.
The Chairman, Mr Hyman, also reaches nine years’ service in 2026.
However, given the concurrent departures of Mr Bond and Mr
Budge, and following consultation with the Company’s advisers and
shareholders, the Board has agreed that Mr Hyman will continue as
Chairman of the Board until the end of 2026, to provide continuity
and stability and to preserve corporate memory during this period
of transition. The Board is satisfied that the Chairman continues to
be independent in both character and judgement and there are no
relationships or circumstances which are likely to affect the judgement
of any Director. Mr Soderstrom will succeed Mr Hyman as Chairman
of the Board at the end of 2026.
CULTURE
The culture of the Company, being an externally managed investment
trust, reflects the combination of values and behaviours of the Board
and the Investment Manager, and is influenced by the quality of their
interactions with one another and with stakeholders. The Company’s
values focus on maintaining strong relationships with the Investment
Manager and its service providers and providing constructive
challenge in order to achieve the Company’s investment objective.
The Chairman leads the Board and is responsible for its overall
effectiveness in directing the Company. He demonstrates objective
judgement, promotes a culture of openness and debate and facilitates
constructive Board relations and the effective contribution of all
Directors. In liaison with the Company Secretary, he ensures that the
Directors receive accurate, timely and clear information. The Directors
are required to act with integrity, lead by example and promote this
culture within the Company.
The Board seeks to ensure the alignment of its purpose, values and
strategy with this culture of openness, debate and integrity, and
ensures the desired culture is embedded through ongoing dialogue
and engagement with its service providers, principally the Investment
Manager. The culture of the Board is considered as part of the annual
performance evaluation process which is undertaken by each Director
and the culture of the Company’s service providers, including their
policies, practices and behaviour, is considered by the Board as a
whole during the annual review of the performance and continuing
appointment of all service providers. The Board holds monthly update
meetings with the Investment Manager and seeks to hold one Board
meeting a year at Pharmakon’s offices in New York. Such meetings
enable the Directors to understand and observe the culture of the
Investment Manager.
Further information on the Company’s engagement with its stakeholders
is set out on pages28 to 30.
CHAIRMAN AND SENIOR INDEPENDENT DIRECTOR
The responsibilities of the Chairman and the Senior Independent
Director (SID) have been agreed by the Board and are available on
the Company’s website.
The Chairman, Mr Hyman, is deemed by his fellow independent Board
members to be independent in character and judgement and free of
any conflicts of interest. He considers himself to have sufficient time to
spend on the affairs of the Company. Mr Hyman has no significant
commitments other than those disclosed in his biography on page42.
As Senior Independent Director, Mr Budge acts as a sounding board
for the Chairman, meets with major shareholders as appropriate,
provides a channel for any shareholder concerns regarding the
Chairman and takes the lead in the annual evaluation of the Chairman
by the independent Directors. In the event of a period of stress, the
Senior Independent Director would work with the Chairman, the other
Directors, and/or shareholders to help resolve any issues.
BOARD OPERATION
There is a clear division of responsibilities between the Board and the
Investment Manager, and the Board has adopted a formal schedule
of matters specifically reserved for its approval.
• approval of the Company’s investment policy, long-term
objectives and commercial strategy;
• approval of the gearing policy of the Company;
• approval of Annual and Half-yearly Reports and financial
statements and accounting policies, prospectuses, circulars and
other shareholder communications;
• raising new capital;
• approval of dividends;
• Board appointments and removals;
• appointment and removal of the Investment Manager, Auditor
and the Company’s other service providers; and
• approval of the Company’s annual expenditure budget.
Corporate Governance Statement continued
GOVERNANCE
49
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
BOARD MEETINGS
The Company has four scheduled Board meetings a year, and monthly
update calls with the Investment Manager when there is no scheduled
Board meeting. Additional meetings are arranged as necessary.
At each Board meeting, the Directors follow a formal agenda which
is circulated in advance by the Company Secretary. The Company
Secretary, the Administrator and the Investment Manager regularly
provide the Board with financial information, including an annual
expenses budget, together with briefing notes and papers in relation
to changes in the Company’s economic and financial environment,
statutory and regulatory changes and corporate governance best
practice. A description of the Company’s risk management and
internal control systems is set out in the Strategic Report on pages32 to
38, and in the Corporate Governance Statement and Audit and Risk
Committee Report on pages51 and 52 respectively.
At each Board meeting, representatives from the Investment Manager
are in attendance to present reports to the Directors covering the
Company’s current and future activities, portfolio of assets and its
investment performance over the preceding period. The Board and
the Investment Manager operate in a fully supportive, co-operative
and open environment and ongoing communication with the Board is
maintained between formal meetings.
AUDIT AND RISK COMMITTEE
The Board has established an Audit and Risk Committee to assist its
operations. The Committee’s delegated responsibilities are clearly
defined in formal terms of reference, which are subject to annual
review by the Board and are available on the Company’s website.
The Committee comprises all Directors and is chaired by Mr Bond.
Given the size and nature of the Board it is felt appropriate that all
Directors are members of the Audit and Risk Committee. The Committee
has direct access to the Company’s Auditor, and provides a forum
through which the Auditor reports to the Board. Representatives of the
Auditor attend quarterly meetings of the Committee.
Further details about the Audit and Risk Committee and its activities
during the year under review are set out on page52.
MEETING ATTENDANCE
The number of scheduled Board and Audit and Risk Committee
meetings held during the year ended 31 December 2025 and the
attendance of the individual Directors is shown below:
Board
Audit and Risk
Committee*
Number
entitled to
attend
Number
attended
Number
entitled to
attend
Number
attended
Colin Bond 4 4 4 4
Duncan Budge 4 4 4 4
Harry Hyman 4 4 4 4
Stephanie Léouzon 4 4 4 4
Sapna Shah 4 4 4 4
Rolf Soderstrom 4 4 4 4
* Two additional Audit and Risk Committee meetings were held during the year to
conduct a page turn review of the Interim and Annual Reports.
INDEPENDENCE OF DIRECTORS
The independence of the Directors is reviewed as part of the
annual Board evaluation process. Each Director is considered to be
independent in character and judgement and entirely independent of
the Investment Manager. None of the Directors sit on the boards of any
other companies managed by the Investment Manager.
A procedure for the induction of new Directors has been established,
including the provision of an induction pack containing relevant
information about the Company, its processes and procedures. New
appointees have the opportunity of meeting with the Chairman, relevant
persons at the Investment Manager and the Company Secretary.
RE-ELECTION AND RETIREMENT OF DIRECTORS
Under the Company’s Articles and in accordance with the AIC Code,
Directors are subject to election by shareholders at the first AGM
after their appointment. Under the Company’s Articles of Association,
thereafter, at each AGM any Director who has not stood for re-election
at either of the two preceding AGMs shall retire. In addition, one-third
of the Directors eligible to retire by rotation shall retire from office at
each AGM. However, in accordance with the AIC Code, the Board
has agreed a policy whereby all Directors will seek annual re-election
at the Company’s Annual General Meetings.
Following formal performance review as detailed below, the Board
strongly recommends the election/re-election of each of the Directors
on the basis of their experience and expertise in investment matters,
their independence and continuing effectiveness and commitment to
the Company. As noted above, Mr Bond and Mr Budge will not seek
re-election at the 2026 AGM.
Corporate Governance Statement continued
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50
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
DIVERSITY POLICY
In accordance with the AIC Code, the Board is comprised of a
mixture of individuals who have an appropriate balance of skills and
experience to meet the future opportunities and challenges facing the
Company. Appointments are made first and foremost on the basis
of merit and objective criteria taking into account the recognised
benefits of all types of diversity. The Board ensures that diversity is an
important consideration and part of the selection criteria used to assess
candidates to achieve a balanced Board.
The Board supports the diversity and inclusion targets in the UK Listing
Rules:
a) at least 40% of individuals on the Board to be women;
b) at least one senior Board position to be held by a woman; and
c) at least one individual on the Board to be from a minority ethnic
background.
The Board recognises that at the date of this report, it is only compliant
with target c) of the diversity and inclusion targets. As part of its ongoing
succession planning, the Board has taken steps that will bring it to full
compliance with all three Listing Rule diversity targets following the
AGM in June 2026. Ms Shah will be appointed Senior Independent
Director at that time, satisfying target b), and the decisions of MrBond
and Mr Budge not to seek re-election at the AGM will result in the
female representation on the Board increasing to 40%, thereby
meeting target a).
The Board continues to develop succession plans to increase diversity
on the Board, and will give due consideration to the recommendations
of the FTSE Women Leaders Review, the Parker Review and the Listing
Rules as part of future recruitment, alongside the established needs of
the Company.
In accordance with UKLR 6 Annex 1R, the tables below set out the
gender and ethnicity of the Directors as at 31 December 2025,
collected through self-reporting by the Directors.
Following the appointment of Mr Reynolds on 1 January 2026, the
gender ratio between the year end and the date of publication of this
report changed to 71:29 male to female. However, after the AGM
in June 2026, the gender ratio will change to 60:40 male to female.
Gender identity or sex
Number
of Board
members
Percentage
on the
Board %
Number
of senior
positions on
the Board*
Men 4 67 2
Women 2 33 –
Not specified/prefer not to say – – –
* The Listing Rules define senior positions as the Chairman and Senior Independent
Director.
Ethnic background
Number
of Board
members
Percentage
on the
Board %
Number
of senior
positions on
the Board
White British or other White
(including minority white
groups)
5 83 2
Mixed/Multiple Ethnic Groups – – –
Asian/Asian British 1 17 –
Black/African/Caribbean/
Black British
– – –
Other ethnic group – – –
Not specified/prefer not to say – – –
CONFLICTS OF INTEREST
It is the responsibility of each individual Director to avoid an unauthorised
conflict of interest situation arising. The Director must request authorisation
from the Board as soon as he/she becomes aware of the possibility of
an interest that conflicts, or might possibly conflict, with the interests of
the Company (“situational conflicts”). The Company’s Articles authorise
the Board to approve such situations, where deemed appropriate.
A register of conflicts is maintained by the Company Secretary and is
reviewed at Board meetings, to ensure that any authorised conflicts
remain appropriate. The Directors are required to confirm at these
meetings whether there has been any change to their position.
The Board is responsible for considering Directors’ requests for
authorisation of situational conflicts and for deciding whether or not the
situational conflict should be authorised. The factors to be considered
will include: whether the situational conflict could prevent the Director
from properly performing their duties; whether it has, or could have,
any impact on the Company; and whether it could be regarded as
likely to affect the judgement and/or actions of the Director in question.
When the Board is deciding whether to authorise a conflict or potential
conflict, only Directors who have no interest in the matter being
considered are able to take the relevant decision, and in taking the
decision the Directors must act in a way they consider, in good faith,
will be most likely to promote the Company’s success. The Directors are
able to impose limits or conditions when giving authorisation if they think
this is appropriate in the circumstances.
PERFORMANCE REVIEW OF THE BOARD
The Directors are aware that they need to continually monitor and
improve performance and recognise this can be achieved through
regular Board evaluation, which provides a valuable feedback
mechanism for improving Board effectiveness. The Board performance
review in 2025 was undertaken internally by way of a questionnaire,
facilitated by the Company Secretary. The results of the Board
evaluation process are reviewed and discussed by the Board as a
whole. The evaluation process is carried out annually. The Board
last conducted an external performance review in 2023, therefore
in accordance with provision 26 of the AIC Code, the Board will
consider conducting an external Board evaluation in 2026.
Corporate Governance Statement continued
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51
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
The evaluation questionnaire was designed to assess the effectiveness
of the Board, the Chairman, the Audit and Risk Committee and the
individual Directors of the Company. The review focussed on several
key areas, including, but not limited to, the Board’s dynamics and
composition, effectiveness of meetings, focus on strategy and direction
of the Company, and stakeholder engagement.
The Board discussed the results of the performance review at its
December meeting and agreed a number of actions to take into 2026.
These included:
– Focus on succession planning and recruitment to ensure Board
composition is aligned with the Company’s future strategy and
for the regular refreshment of the Board and in light of Board
changes planned during 2026.
– Continuing to focus on the strategy for the future growth of the
Company. As a result of the performance review, the Board have
agreed to hold a strategy day in 2026.
The review concluded that the Board is effective at overseeing the
management of the Company and safeguarding shareholders’
interests. The Board maintains strong working relationships with the
Investment Manager and the Company’s service providers, and
frequently challenges the Investment Manager in a constructive
manner. The Board considers that all Directors contribute effectively
and have the skills, experience and knowledge necessary to suit the
achievement of the Company’s long-term strategy and that the Board
operates effectively. The Board has satisfied itself that the Directors have
enough time to devote to their duties as a Directors of the Company.
COMPANY SECRETARY
The Board has direct access to the advice and services of the
Company Secretary, MUFG Corporate Governance Limited, which
is responsible for ensuring that Board and Committee procedures
are followed and that applicable regulations are complied with. The
Company Secretary is also responsible to the Board for ensuring timely
delivery of the information and reports which the Directors require and
that the statutory obligations of the Company are met.
INTERNAL CONTROL REVIEW
The Board is responsible for the systems of internal controls relating
to the Company, including the reliability of the financial reporting
process and for reviewing the systems’ effectiveness. The Directors
have reviewed and considered the guidance supplied by the FRC on
risk management, internal control and related finance and business
reporting and an ongoing process has been established for identifying,
evaluating and managing the principal risks faced by the Company.
This process, together with key procedures established with a view to
providing effective financial control, was in place during the year under
review and at the date of this report.
The internal control systems are designed to ensure that proper
accounting records are maintained, that the financial information on
which business decisions are made and which is issued for publication
is reliable, and that the assets of the Company are safeguarded.
The risk management process and systems of internal control are
designed to manage rather than eliminate the risk of failure to achieve
the Company’s objectives. It should be recognised that such systems
can only provide reasonable, not absolute, assurance against material
misstatement or loss.
Throughout the year, the Board has been preparing to comply with
provision 34 of the AIC Code, which is effective from 1January 2026,
and the Board will report on its compliance with provision 34 in its
2026 Annual Report. Further details on the readiness activities can be
found in the Audit and Risk Committee Report on page52.
The Directors have carried out a review of the effectiveness of the
systems of internal control as they have operated over the year and
up to the date of approval of the report and financial statements.
There were no matters arising from this review that required further
investigation and no significant failings or weaknesses were identified.
INTERNAL CONTROL ASSESSMENT PROCESS
Robust risk assessments and reviews of internal controls are undertaken
regularly in the context of the Company’s overall investment objective:
In arriving at its judgement of what risks the Company faces, the Board
has considered the Company’s operations in light of the following
factors:
• the nature and extent of risks which it regards as acceptable for
the Company to bear within its overall business objective;
• the threat of such risks becoming reality;
• the Company’s ability to reduce the incidence and impact of risk
on its performance;
• the cost to the Company and benefits related to the review of risk
and associated controls of the Company; and
• the extent to which third parties operate the relevant controls.
A risk matrix has been produced against which the risks identified and
the controls in place to mitigate those risks can be monitored. The risks
are assessed on the basis of the likelihood of them happening, the
impact on the business if they were to occur and the effectiveness of the
controls in place to mitigate them. This risk matrix is reviewed twice a
year by the Audit and Risk Committee and at other times as necessary.
The principal risks that have been identified by the Board are set out
on pages32 to 38.
The Board reviews financial information produced by the Investment
Manager and the Administrator on a regular basis. Most functions
for the day-to-day management of the Company are subcontracted,
and the Directors therefore obtain regular assurances and information
from key third-party suppliers regarding the internal systems and
controls operated in their organisations. In addition, each third party is
requested to provide a copy of its report on internal controls each year,
which is reviewed by the Audit and Risk Committee.
This statement was approved by the Board of Directors and signed on
its behalf by:
MUFG Corporate Governance Limited
Company Secretary
23 March 2026
GOVERNANCE
52
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
Audit and Risk Committee Report
I am pleased to present the Audit and Risk Committee Report for the
year ended 31December 2025.
RESPONSIBILITIES OF THE COMMITTEE
The primary responsibilities of the Committee are as follows:
• to monitor the integrity of the financial statements of the Company,
the financial reporting process and the accounting policies of the
Company;
• to review the content of the Annual Report and financial statements
and advise the Board on whether, taken as a whole, it is fair,
balanced and understandable and provides the information
necessary for shareholders to assess the Company’s position and
performance, business model and strategy;
• to keep under review the effectiveness of the Company’s internal
control environment and risk management systems;
• to review the scope and effectiveness of the audit process
undertaken by the Auditor;
• to monitor compliance with laws, regulations and applicable
ethical codes of practice;
• to make recommendations to the Board in relation to the
appointment, reappointment or removal of the external Auditor
and to approve its remuneration and terms of engagement;
• to review and monitor the Auditor’s independence, objectivity
and effectiveness, and the performance and quality of audit work
produced by the Auditor; and
• to approve any non-audit services to be provided by the Auditor
and monitor the level of fees payable in that respect.
ACTIVITIES IN THE YEAR
During the year, the Committee has:
• conducted a review of the internal controls and risk management
systems of the Company and its third-party service providers;
• agreed the audit plan and fees with the Auditor in respect of the
first and third quarter agreed upon procedures, the interim review
of the Half-yearly Report for the period ended 30 June 2025
and the statutory audit of the Annual Report for the year ended
31December 2025, including the principal areas of focus;
• received and discussed with the Auditor its report on the results
of the review of the half-yearly financial statements and the year
end audit;
• reviewed the Company’s half-yearly and annual financial
statements and recommended these to the Board for approval;
• examined in detail the methodology and assumptions applied in
revaluing the assets of the Company;
• reviewed the valuation of the Company’s assets on a quarterly
basis;
• reviewed the Auditors’ agreed-upon-procedures reports on
aspects of the data underpinning the valuation process of the
Company’s assets for Q1 and Q3 of 2025; and
• reviewed and updated its Terms of Reference in line with the 2024
AIC Code and FRC Minimum Standard for Audit Committees
(the“Minimum Standard”).
MEETINGS
The Committee met six times during the year under review and once
following the year end.
Details of the composition of the Committee are set out in the Corporate
Governance Statement on page49.
SIGNIFICANT ISSUES
The Committee considered a number of significant issues and areas of
key audit risk in relation to the Company’s financial statements during
the year. A more detailed explanation of the consideration of the issues
set out below, and the steps taken to manage them, is set out in the
Principal Risks and Uncertainties on pages32 to 38.
Valuation of unlisted investments
In the year under review, the Committee reviewed the valuation
process of the Company’s unlisted investments and the systems in
place to ensure the accuracy of these valuations, particularly in view
of the fact that the unlisted investments represent the principal element
of the NAV. During the year, the Committee met on a quarterly as well
as an ad hoc basis to conduct reviews of the investments held by the
Company and was comfortable with the valuations given.
Internal controls
The Committee carefully considers the internal control systems by
continually monitoring the services and controls of its third-party
service providers. Further information on the Board’s internal control
assessment process can be found on page51.
The Committee reviewed and updated the risk matrix during the year
under review. This is done on a biannual basis. The Committee received
a report on internal control and compliance from the Administrator and
Registrar and no significant matters of concern were identified.
The Committee assessed whether any updates to its processes and
procedures would be required to prepare to comply with Provision34
of the AIC Corporate Governance Code (“AIC Code”) (Provision29
of the UK Corporate Governance Code (“UK Code”)), which is
effective for accounting periods beginning on or after 1 January
2026. As part of its readiness activities, the Committee engaged an
independent third-party adviser to conduct a comprehensive review of
the Company’s governance and assurance frameworks.
The Committee reviewed the findings of this review and has since
strengthened the documentation of the Company’s internal control
and risk management processes. Further steps taken by the Board
included defining the scope of the Company’s controls considered to
be material and testing the effectiveness of these material controls. The
Committee will provide an update on its compliance with Provision 34
of the AIC Code (Provision 29 of the UK Code) in the Company’s
2026 Annual Report.
Audit and Risk Committee Report continued
GOVERNANCE
53
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
The Company does not have an internal audit function. During the
year, the Committee reviewed whether an internal audit function
would be of value and concluded that this would provide minimal
additional comfort at considerable extra cost to the Company. While
the Committee believes that the existing system of monitoring and
reporting by third parties remains appropriate and adequate, it will
continue, on an annual basis, to actively consider possible areas within
the Company’s controls environment which may need to be reviewed
in detail and disclose any material weakness identified.
GOING CONCERN AND LONG-TERM VIABILITY OF
THE COMPANY
The Committee considered the Company’s financial requirements for
the next 12 months and concluded that it has sufficient resources to
meet its commitments. Consequently, the financial statements have
been prepared on a going concern basis.
The Committee considered the longer-term viability statement within the
Annual Report for the year ended 31December 2025, covering a five-
year period, as well as the underlying factors and assumptions which
contributed to the Committee deciding that this was an appropriate
length of time to consider the Company’s long-term viability. The
Company’s viability statement can be found on page39.
CONCLUSION IN RESPECT OF THE ANNUAL REPORT
The Committee has concluded that the Annual Report for the year
ended 31 December 2025, taken as a whole, is fair, balanced
and understandable and provides the information necessary for
shareholders to assess the Company’s business model, strategy and
performance. In reaching this conclusion, the Committee drew on
multiple layers of assurance, including detailed reviews undertaken by
the Investment Manager, service providers and individual Directors,
as well as the Company’s internal control framework and the control
assurance reports provided to the Committee by the Company’s
service providers. The Committee has reported on these findings to the
Board.
AUDIT FEES AND NON-AUDIT SERVICES PROVIDED BY
THE AUDITOR
The Committee reviewed the audit plan and fees presented by the
Auditor and considered its report on the financial statements. Total fees
for the year payable to the Auditor amounted to $390,910. This figure
includes non-audit fees of $88,600 in respect of the interim review of
the Half-yearly Report and financial statements for the period ended
30June 2025 and in respect of quarterly agreed upon procedures
over investment valuations. In accordance with the Company’s policy
on the provision of non-audit services, all non-audit services provided
by the Auditor during the year were approved in advance by the
Directors. Further information on the fees paid to the Auditor is set out in
Note4 to the financial statements.
The non-audit services provided by the Auditor during the year under
review were assurance related, and the Committee firmly believes that
Ernst & Young (“EY”) have been best placed to provide them on a
timely and cost-effective basis to the benefit of shareholders.
EFFECTIVENESS OF THE EXTERNAL AUDIT
The Committee reviews the effectiveness of the external audit carried
out by the Auditor on an annual basis. The Chairman of the Committee
maintained regular contact with the Company’s Audit Partner
throughout the year and met with them prior to the finalisation of the
audit of the Annual Report and financial statements for the year ended
31 December 2025, without the Investment Manager present. The
Chairman discussed with the Auditor how the external audit was carried
out, the findings from the audit and whether any issues had arisen from
the Auditor’s interaction with the Company’s various service providers.
The Committee also considers the annual Audit Quality Reports on EY
published by the Irish Auditing and Accounting Supervisory Authority
and the FRC, as well as feedback from the Investment Manager and
the Committee’s own observations. The Committee has the opportunity
to meet with the Audit Partner without the Investment Manager present
following each Committee meeting.
INDEPENDENCE AND OBJECTIVITY OF THE AUDITOR
The Committee has considered the independence and objectivity of
the Auditor and has conducted a review of non-audit services which
the Auditor has provided during the year under review. The Committee
receives an annual confirmation from the Auditor that its independence
is not compromised by the provision of such non-audit services. Vincent
Bergin is the Audit Partner allocated to the Company by EY. The audit
of the financial statements for the year ended 31December 2025 is his
fourth audit as Audit Partner. The Committee is satisfied that the Auditor’s
objectivity and independence is not impaired by the performance of
these non-audit services and that the Auditor has fulfilled its obligations
to the Company and its shareholders.
AUDITOR TENURE
The Committee is mindful of the regulations on mandatory auditor
rotation, which require a formal audit tender to be conducted every
ten years.
EY was appointed as external auditor by shareholders at the AGM in
2022, following a competitive tender process in relation to the statutory
audit of the Company in 2021. There are no contractual obligations in
place that restrict the Company’s choice of statutory auditor.
The Committee is satisfied that the Company has complied with the
provisions of the Statutory Audit Services Order 2014.
REAPPOINTMENT OF THE AUDITOR
Following consideration of the performance of the Auditor, the services
provided during the year and a review of its independence and
objectivity, the Committee is satisfied with the performance and ongoing
quality and independence of EY as external Auditor. Consequently,
the Committee has recommended to the Board that a resolution to re-
appoint EY as Auditor be put to shareholders at the 2026 AGM.
Colin Bond
Audit and Risk Committee Chairman
23 March 2026
GOVERNANCE
54
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
Remuneration Report
STATEMENT FROM THE CHAIRMAN
I am pleased to present the Directors’ Remuneration Report for the year
ended 31 December 2025.
As set out in the Corporate Governance Statement on page 47, the
Directors’ remuneration and the Remuneration Policy is determined by
the Board as a whole. The Board does not consider it necessary to
have a separate Remuneration Committee, as all directors are non-
executive and independent of the Investment Manager. The Board
reviews Directors’ fees on an annual basis, in December each year.
During the year ended 31 December 2025, the annual fees were as
follows:
Chairman $124,500
Chairman of the Audit and Risk Committee $105,800
Director $87,200
The Board reviewed Directors’ remuneration at its meeting in December
2025, taking into account a number of factors including recent and
relevant benchmarking analysis produced by Trust Associates and
broader inflationary increases since that time. Following consideration,
the Board agreed that, with effect from 1 January 2026, the annual
fees for the Chairman, the Chairman of the Audit and Risk Committee
and for a Director should be increased by 4 per cent., rounded to the
nearest $100.
Consequently, the revised fee levels for Directors’ remuneration for the
year ending 31 December 2026 will be as follows:
Chairman $129,500
Chairman of the Audit and Risk Committee $110,000
Director $90,800
The Directors’ Remuneration Report is put to a shareholder vote on an
annual basis.
The Directors’ Remuneration Policy is put to a shareholder vote in the
first year of a company or in any year where there is to be a change
to the policy and, in any event, at least once every three years. The
Directors’ Remuneration Policy was last approved by shareholders in
2024 and it will therefore next be put to shareholders at the AGM to
be held in 2027. There will be no significant change in the way the
current, approved Remuneration Policy will be implemented during the
course of the next financial year.
VOTING AT AGM
The Directors’ Remuneration Report for the year ended 31 December 2025 was approved at the AGM on 9 June 2025 and the Directors’
Remuneration Policy was approved by shareholders at the AGM on 12 June 2024. The votes cast were as follows:
Directors Remuneration Report (2025 AGM) Directors Remuneration Policy (2024 AGM)
Number of votes % of votes cast Number of votes % of votes cast
For 579,743,647 99.96 558,551,021 99.96
Against 225,063 0.04 2 2 7, 616 0.04
At Chairman’s discretion – – – –
Total votes casted 579,968,710 100.00 558,778,637 100.00
Number of Votes withheld 4,062,691 – 201,340 –
Remuneration Report continued
GOVERNANCE
55
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
PERFORMANCE OF THE COMPANY
The graph below compares the total return to Ordinary Shareholders compared to the Investment Trusts Total Market ex VCTs Indices as a market
reference for investors. The index was selected to serve as a comparative performance reference point to help shareholders understand how the
Company is doing relative to similar strategies or markets.
(20.00)
(15.00)
(10.00)
(5.00)
-
5.00
0
20
40
60
80
100
120
140
160
180
200
Feb-21 Aug-21 Feb-22 Aug-22 Feb-23 Aug-23 Feb-24 Aug-24 Feb-25 Aug-25
Relative Share Performance of Company in terms of Total Share Return
1
BPCR - Price TR (%) (LHS)
Investment Trusts Total Market ex VCTs - Price TR (%) (LHS)
BPCR - Cum fair discount (%) (RHS)
DS Investment Trusts incl VCTs ex 3i - Cum fair discount (%) (RHS)
DIRECTORS’ REMUNERATION FOR THE YEAR ENDED 31 DECEMBER 2025 (AUDITED)
The remuneration paid to the Directors during the year ended 31 December 2025 is set out in the table below (USD):
Remuneration Expenses Total
Year ended
31December
2025
Year ended
31December
2024
Year ended
31December
2025
Year ended
31December
2024
Year ended
31December
2025
Year ended
31December
2024
Harry Hyman 124,500 118,600 5,794 5,634 130,294 124,234
Colin Bond 105,800 100,800 15 , 619 11 , 74 9 121, 419 112,549
Duncan Budge 87,200 83,000 – 5,501 87,200 88,501
Stephanie Leouzon 87,200 83,000 13,394 7,13 8 100,594 90,138
Rolf Soderstrom 87,200 83,000 4, 734 5,854 91,9 34 88,854
Sapna Shah 87,200 83,000 6,533 4, 510 93,733 87,510
Nigel Reynolds
2
– – – – – –
1
Past performance is not an indication of future performance.
2
Appointed as Director 1 January 2026
Remuneration Report continued
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56
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
The annual percentage change in remuneration paid to the Directors is set out in the table below (USD):
% change from 2024
to 2025
% change from 2023 to
2024
% Change from
2022 to 2023
% Change from
2021 to 2022
Harry Hyman 5% 8% 5% 5%
Colin Bond 5% 8% 5% 5%
Duncan Budge 5% 8% 5% 5%
Stephanie Leouzon 5% 8% 5% 5%
Rolf Soderstom 5% 8% 5% 5%
Sapna Shah 5% 38%
1
– –
Nigel Reynolds
2
– – – –
1
Appointed as a Director on 22 March 2023 and was paid on a pro rata basis until the year ended 31 December 2023.
2
Appointed as director 1 January 2026
RELATIVE IMPORTANCE OF SPEND ON PAY
The table below sets out in respect of the year ended 31 December 2025:
a) the remuneration paid to the Directors;
b) the Investment management fee;
c) the Investment Manager’s performance fee;
d) the distributions made to shareholders by way of dividend; and
e) the spend on buybacks including stamp duty.
Year ended
31December
2025
$
Year ended
31December
2024
$
Change
%
Directors’ remuneration 579,100 551,400 5.02
Investment management fee 11,297,826 11,996,555 (5.82)
Investment Manager’s performance fee 14,430,513 13,574,065 6.31
Dividends paid to shareholders 110,377,903
1
174,662,511
2
(36.81)
Buyback spend including stamp duty 50,324,716 106,698,728 (52.83)
1
Amount shown represents dividends paid in respect to the four quarters 31 December 2024 through 30 September 2025. Past performance is not indicative of future performance.
2
Dividends paid to shareholders in 2024 include a dividend of $48.9 million that became payable on 5 January 2024. In accordance with AIC SORP guidelines, this dividend
was excluded from the annual report for the year ended 31 December 2023. Excluding this amount, total dividends for 2024 would have been $125.8 million, and the year on
year change between 2024 and 2025 would have been 12.27 per cent. Amount shown represents dividends paid in respect to the five quarters 30 September 2023 through
30 September 2024. Past performance is not indicative of future performance.
The investment management fee and Investment Manager’s performance fee have been selected as they represent a significant payment from the
Company to its investment manager. Further details on their calculation can be found in Note 4.
Remuneration Report continued
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BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
DIRECTORS’ REMUNERATION FOR THE YEAR ENDED 31 DECEMBER 2025 (AUDITED) (CONTINUED)
There is no requirement under the Company’s Articles for Directors to hold Shares in the Company.
As at 31 December 2025, the interests of the Directors and any connected persons in the Ordinary Shares in issue of the Company are set out
below:
Year ended
31 December 2025
Number of Shares
Year ended
31 December 2024
Number of Shares
Harry Hyman 104,057
1
103, 725
2
Colin Bond 100,000 100,000
Duncan Budge
3
100,000 100,000
Stephanie Leouzon nil nil
Rolf Soderstom
4
200,000 200,000
Sapna Shah 96,990 96,990
Nigel Reynolds nil nil
1
4,057 of these shares are held by a person closely associated with Mr Hyman.
2
3,725 of these shares were held by a person closely associated with Mr Hyman.
3
The legal and beneficial interest in 50% of Mr Budge’s shares is held by a person closely associated with Mr Budge.
4
The legal and beneficial interest in 50% of Mr Soderstrom’s shares is held by a person closely associated with Mr Soderstrom.
There have been no changes in any of the Directors’ shareholdings as detailed above since the year end and up to the date of this report.
None of the Directors or any persons closely associated with them had a material interest in the Company’s transactions, arrangements or
agreements during the year.
GOVERNANCE
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BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
Remuneration Policy
INTRODUCTION
The Directors’ Remuneration Policy is put to a shareholder vote at least
once every three years and in any year if there is to be a change
in the Directors’ Remuneration Policy. A resolution to approve this
Remuneration Policy was proposed at the annual general meeting of
the Company held on 12 June 2024. The Company’s Remuneration
Policy, is set out below.
POLICY
The Company follows the recommendation of the AIC Code that
Non-executive Directors’ remuneration should reflect the time
commitment and responsibilities of the role. The Board’s policy is
that the remuneration of Non-executive Directors should reflect the
experience of the Board as a whole, and be determined with reference
to comparable organisations and appointments.
All Directors are Non-executive, appointed under the terms of letters of
appointment. There are no service contracts in place.
DIRECTORS’ FEE LEVELS
The Company has no employees. In line with the majority of investment
trusts, there are no performance conditions attached to the remuneration
of the Directors as the Board does not consider such arrangements or
benefits necessary or appropriate for Non-executive Directors.
The Board has set three levels of fees: for a Director, for the Chairman of
the Audit and Risk Committee and for the Chairman of the Board. Fees
are reviewed annually in accordance with the above policy. Thefee
for any new Director appointed to the Board will be determined on
the same basis.
The approval of shareholders would be required to increase the
aggregate limit of $750,000, as set out in the Company’s Articles.
The Company is committed to ongoing shareholder dialogue and any
views expressed by shareholders on the fees being paid to Directors
would be taken into consideration by the Board when reviewing
the Directors’ Remuneration Policy and in the annual review of
Directors’fees.
APPROVAL
The Directors’ Remuneration Report was approved by the Board and
signed on its behalf by:
Harry Hyman
Chairman
23 March 2026
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BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
Statement of Directors’ Responsibilities
In respect of the Financial Statements
The directors are responsible for preparing the Annual Report and the
financial statements in accordance with applicable law and regulation.
Company law requires the directors to prepare financial statements
for each financial year. Under that law the directors have prepared
the financial statements in accordance with UK adopted International
Accounting Standards (“UK IAS”).
Under company law, directors must not approve the financial
statements unless they are satisfied that they give a true and fair view
of the state of affairs of the Company and of the profit or loss of the
company for that period. In preparing the financial statements, the
directors are required to:
• select suitable accounting policies and then apply them
consistently;
• state whether applicable UK IASs have been followed, subject to
any material departures disclosed and explained in the financial
statements;
• make judgements and accounting estimates that are reasonable
and prudent; and
• prepare the financial statements on the going concern basis unless
it is inappropriate to presume that the company will continue in
business.
The directors are also responsible for safeguarding the assets of the
company and hence for taking reasonable steps for the prevention
and detection of fraud and other irregularities.
The directors are responsible for keeping adequate accounting records
that are sufficient to show and explain the Company’s transactions and
disclose with reasonable accuracy at any time the financial position of
the company and enable them to ensure that the financial statements
and the Directors’ Remuneration Report comply with the Companies
Act 2006. The directors are responsible for the maintenance and
integrity of the Company’s website. Legislation in the United Kingdom
governing the preparation and dissemination of financial statements
may differ from legislation in other jurisdictions.
DIRECTORS’ CONFIRMATIONS
The Directors consider that the Annual Report and accounts, taken
as a whole, are fair, balanced and understandable and provide
the information necessary for shareholders to assess the Company’s
position and performance, business model and strategy.
Each of the directors, whose names and functions are listed in the
Board of Directors section on pages42 to 43 confirm that, to the best
of their knowledge:
• the company financial statements, which have been prepared in
accordance with UK IASs, give a true and fair view of the assets,
liabilities, financial position and profit of the Company; and
• the Strategic Report includes a fair review of the development
and performance of the business and the position of the company,
together with a description of the principal risks and uncertainties
that it faces.
On behalf of the Board
Harry Hyman
Chairman
23 March 2026
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BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
Independent Auditor’s Report
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS
OF BIOPHARMA CREDIT PLC
OPINION
We have audited the financial statements of BioPharma Credit PLC for
the year ended 31 December 2025 which comprise the Statement
of comprehensive income, the Statement of changes in equity, the
Statement of financial position, the Cash flow statement, and the
related notes 1 to 19, including material accounting policy information.
The financial reporting framework that has been applied in their
preparation is applicable law and UK adopted International
Accounting Standards.
In our opinion, the financial statements:
• give a true and fair view of the Company’s affairs as at 31
December 2025 and of its profit for the year then ended;
• have been properly prepared in accordance with UK adopted
international accounting standards; and
• have been prepared in accordance with the requirements of the
Companies Act 2006.
BASIS FOR OPINION
We conducted our audit in accordance with International Standards
on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities
under those standards are further described in the Auditor’s
responsibilities for the audit of the financial statements section of our
report. We believe that the audit evidence we have obtained is
sufficient and appropriate to provide a basis for our opinion
INDEPENDENCE
We are independent of the Company in accordance with the ethical
requirements that are relevant to our audit of the financial statements
in the UK, including the FRC’s Ethical Standard as applied to public
interest entities, and we have fulfilled our other ethical responsibilities in
accordance with these requirements.
The non-audit services prohibited by the FRC’s Ethical Standard were
not provided to the Company and we remain independent of the
Company in conducting the audit.
CONCLUSIONS RELATING TO GOING CONCERN
In auditing the financial statements, we have concluded that the
directors’ use of the going concern basis of accounting in the
preparation of the financial statements is appropriate. Our evaluation
of the directors’ assessment of the Company’s ability to continue to
adopt the going concern basis of accounting included:
• assessing the relevance and reliability of underlying data and
key assumptions used in managements valuation model, such as
income and paydown forecasts used;
• evaluating management’s plans for future actions in relation to
their going concern assessment;
• assessing market altering factors such as pandemics by looking at
the operational impact; and assessing the appropriateness of the
going concern disclosures in the financial statements.
Based on the work we have performed, we have not identified any
material uncertainties relating to events or conditions that, individually
or collectively, may cast significant doubt on the Company’s ability to
continue as a going concern for a period of at least twelve months from
when the financial statements are authorised for issue.
In relation to the Company’s reporting on how they have applied the
UK Corporate Governance Code, we have nothing material to add
or draw attention to in relation to the directors’ statement in the financial
statements about whether the directors considered it appropriate to
adopt the going concern basis of accounting.
Our responsibilities and the responsibilities of the directors with respect
to going concern are described in the relevant sections of this report.
However, because not all future events or conditions can be predicted,
this statement is not a guarantee as to the Company’s ability to continue
as a going concern.
OVERVIEW OF OUR AUDIT APPROACH
Key audit matters
• Valuation of unlisted investments
• Risk of error arising from the use of end user computing related
to the valuation of unlisted investments
Materiality
• Overall materiality of $11.50 million which represents 1% of
net assets.
AN OVERVIEW OF THE SCOPE OF OUR AUDIT
TAILORING THE SCOPE
Our assessment of audit risk, our evaluation of materiality and our
allocation of performance materiality
determine our audit scope for the Company. This enables us to form
an opinion on the financial statements. We take into account size, risk
profile, the organisation of the Company and effectiveness of controls,
the potential impact of climate change and changes in the business
environment when assessing the level of work to be performed. All
audit work was performed directly by the audit engagement team.
CLIMATE CHANGE
Stakeholders are increasingly interested in how climate change will
impact BioPharma Credit PLC. The Company has determined that the
most significant future impacts from climate change on its operations
will be from the Company’s generally limited ability to influence its
portfolio companies. These are explained on pages 22 to 25 in the
Strategic Report. These disclosures form part of the “Other information,”
rather than the audited financial statements. Our procedures on
these unaudited disclosures therefore consisted solely of considering
Independent Auditor’s Report continued
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BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
whether they are materially inconsistent with the financial statements or
our knowledge obtained in the course of the audit or otherwise appear
to be materially misstated, in line with our responsibilities on “Other
information”.
In planning and performing our audit we assessed the potential impacts
of climate change on the Company’s business and any consequential
material impact on its financial statements.
KEY AUDIT MATTERS
Key audit matters are those matters that, in our professional judgement,
were of most significance in our audit of the financial statements of the
current period and include the most significant assessed risks of material
misstatement (whether or not due to fraud) that we identified. These
matters included those which had the greatest effect on the overall
audit strategy, the allocation of resources in the audit; and directing
the efforts of the engagement team. These matters were addressed in
the context of our audit of the financial statements as a whole, and in
our opinion thereon, and we do not provide a separate opinion on
these matters.
Risk Our response to the risk Key observations communicated
to the Audit Committee
Valuation of unlisted investments
($1,028 million; 2024: $1,162 million)
Refer to the Audit and Risk Committee Report
(page 52); Accounting policies (page 73);
and Note 7 of the Financial Statements
(page 83)
There is a risk of material misstatement relating
to management override of controls over
the calculation of the rate used to discount
future cash flows for unlisted investments, and
in certain circumstances, the estimation of
the timing of those cash flows. The process
involves manual input of a discount rate and
the expected future timing of cash flows.
The discount rate has a higher likelihood of
material misstatement due to complexity and
subjectivity of the judgements made across
a number of investments. We identified this
risk as having an element of management
override of control and hence this significant
risk is also a fraud risk.
To test the valuation of unlisted investments,
our audit procedures included, among others
• gaining an understanding of the
controls over the discount rates applied
and the risk of management override of
such controls
• reviewing the latest available
information for each of the borrowers,
in particular, focusing on evidence of
changes in credit risk including through
incremental borrowing from third parties
• considering evidence of changes
in general market rates arising from
transactions involving third parties
• considering whether likely changes
in cash flows have been considering
management’s estimates
• involving a valuation team with
specialised knowledge in assessing
the discount rates applied to certain
loans, and reviewing and challenging
any observations made on their
reasonableness
• performing sensitivity analysis of
the impact of changes in certain
assumptions used on the fair value in the
model
We concluded that the valuation of unlisted
investments is materially correct based on our
procedures performed.
Independent Auditor’s Report continued
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BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
Risk Our response to the risk Key observations communicated
to the Audit Committee
Risk of error arising from the use of End
User Computing related to the valuation
of unlisted investments ($1,028 million;
2024: $1,162 million)
Refer to the Audit and Risk Committee Report
(page 52); Accounting policies (page 73);
and Note 7 of the Financial Statements
(page 83)
There is a risk of errors in the asset models
from which the fair value of the unlisted
investments, disclosed discount rates, and
discount rate sensitivities are derived.
The asset models are prepared in Microsoft
Excel and are of a manual nature which
involve complex calculations and manual
inputs including updates from amendments to
loan agreements which are subject to error.
To test the end user computing models, our
audit procedures included, among others,
• Gaining an understanding
and evaluating the design and
implementation of the controls over
the manual inputs (for example,
amendments to loan terms in the period)
to the asset model to ensure the inputs
used in the calculations are correct.
• Reperforming model calculations to
consider whether they were materially
correct
• Agreeing key inputs to the models
to agreements or other supporting
documentation
• Considering whether all amendments to
loan agreements have been considered
in the models for all investments.
We concluded that the valuation of unlisted
investments, disclosed discount rates, and
discount rate sensitivities are materially
correct based on our procedures performed
OUR APPLICATION OF MATERIALITY
We apply the concept of materiality in planning and performing the
audit, in evaluating the effect of identified misstatements on the audit
and in forming our audit opinion.
MATERIALITY
The magnitude of an omission or misstatement that, individually or in the
aggregate, could reasonably be expected to influence the economic
decisions of the users of the financial statements. Materiality provides
a basis for determining the nature and extent of our audit procedures.
We determined materiality for the Company to be $11.5 million
(2024: $11.80 million), which is 1% (2024: 1%) of net assets. We
believe that net assets provides us with an appropriate basis for
determining materiality as it is an important measure of performance
for users of the financial statements.
PERFORMANCE MATERIALITY
The application of materiality at the individual account or balance
level. It is set at an amount to reduce to an appropriately low level
the probability that the aggregate of uncorrected and undetected
misstatements exceeds materiality.
On the basis of our risk assessments, together with our assessment
of the Company’s overall control environment, our judgement was
that performance materiality was 75% (2024: 50%) of our planning
materiality, namely $8.6 million (2024: $5.9 million). We have set
performance materiality at this percentage to ensure that the risk
of errors exceeding performance materiality was appropriately
managed. The performance materiality changed to 75% due to the
stable operating environment.
REPORTING THRESHOLD
An amount below which identified misstatements are considered as
being clearly trivial.
We agreed with the Audit Committee that we would report to them
all uncorrected audit differences in excess of $0.6 million (2024:
$0.6 million), which is set at 5% of planning materiality, as well as
differences below that threshold that, in our view, warranted reporting
on qualitative grounds.
We evaluate any uncorrected misstatements against both the
quantitative measures of materiality discussed above and in light of
other relevant qualitative considerations in forming our opinion.
OTHER INFORMATION
The other information comprises the information included in the
annual report, other than the financial statements and our auditor’s
report thereon. The directors are responsible for the other information
contained within the annual report.
Our opinion on the financial statements does not cover the other
information and, except to the extent otherwise explicitly stated in this
report, we do not express any form of assurance conclusion thereon.
Our responsibility is to read the other information and, in doing so,
consider whether the other information is materially inconsistent with
the financial statements or our knowledge obtained in the course of the
audit or otherwise appears to be materially misstated. If we identify such
material inconsistencies or apparent material misstatements, we are
required to determine whether this gives rise to a material misstatement
in the financial statements themselves. If, based on the work we have
Independent Auditor’s Report continued
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BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
performed, we conclude that there is a material misstatement of the
other information, we are required to report that fact.
We have nothing to report in this regard.
OPINIONS ON OTHER MATTERS PRESCRIBED BY THE
COMPANIES ACT 2006
In our opinion the part of the directors’ remuneration report to
be audited has been properly prepared in accordance with the
Companies Act 2006.
In our opinion, based on the work undertaken in the course of the audit:
• the information given in the strategic report and the directors’
report for the financial year for which the financial statements are
prepared is consistent with the financial statements; and
• the strategic report and directors’ reports have been prepared in
accordance with applicable legal requirements;
MATTERS ON WHICH WE ARE REQUIRED TO REPORT
BY EXCEPTION
In the light of the knowledge and understanding of the Company and its
environment obtained in the course of the audit, we have not identified
material misstatements in the strategic report or directors’ report.
We have nothing to report in respect of the following matters in relation
to which the Companies Act 2006 requires us to report to you if, in our
opinion:
• adequate accounting records have not been kept; or
• the financial statements and the part of the Directors’ Remuneration
Report to be audited are not in agreement with the accounting
records and returns; or
• certain disclosures of directors’ remuneration specified by law are
not made; or
• we have not received all the information and explanations we
require for our audit
CORPORATE GOVERNANCE STATEMENT
We have reviewed the directors’ statement in relation to going concern,
longer-term viability and that part of the Corporate Governance
Statement relating to the Company’s compliance with the provisions
of the UK Corporate Governance Code specified for our review by
the UK Listing Rules.
Based on the work undertaken as part of our audit, we have concluded
that each of the following elements of the Corporate Governance
Statement is materially consistent with the financial statements or our
knowledge obtained during the audit:
• Directors’ statement with regards to the appropriateness of
adopting the going concern basis of accounting and any material
uncertainties identified set out on page 53;
• Directors’ explanation as to its assessment of the Company’s
prospects, the period this assessment covers and why the period
is appropriate set out on page 39;
• Director’s statement on whether it has a reasonable expectation
that the group will be able to continue in operation and meets its
liabilities set out on page 39 ;
• Directors’ statement on fair, balanced and understandable set out
on page 59;
• Board’s confirmation that it has carried out a robust assessment of
the emerging and principal risks set out on page 32;
• The section of the annual report that describes the review of
effectiveness of risk management and internal control systems set
out on page 51; and;
• The section describing the work of the audit committee set out on
page 52
RESPONSIBILITIES OF DIRECTORS
As explained more fully in the directors’ responsibilities statement set
out on page 59, the directors are responsible for the preparation of
the financial statements and for being satisfied that they give a true
and fair view, and for such internal control as the directors determine
is necessary to enable the preparation of financial statements that are
free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible
for assessing the Company’s ability to continue as a going concern,
disclosing, as applicable, matters related to going concern and using
the going concern basis of accounting unless the directors either intend
to liquidate the Company or to cease operations, or have no realistic
alternative but to do so.
AUDITOR’S RESPONSIBILITIES FOR THE AUDIT OF THE
FINANCIAL STATEMENTS
Our objectives are to obtain reasonable assurance about whether the
financial statements as a whole are free from material misstatement,
whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance,
but is not a guarantee that an audit conducted in accordance with
ISAs (UK) will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered
material if, individually or in the aggregate, they could reasonably be
expected to influence the economic decisions of users taken on the
basis of these financial statements.
Explanation as to what extent the audit was considered
capable of detecting irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance with laws
and regulations. We design procedures in line with our responsibilities,
outlined above, to detect irregularities, including fraud. The risk of not
detecting a material misstatement due to fraud is higher than the risk of
not detecting one resulting from error, as fraud may involve deliberate
Independent Auditor’s Report continued
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BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
concealment by, for example, forgery or intentional misrepresentations,
or through collusion. The extent to which our procedures are capable
of detecting irregularities, including fraud is detailed below.
• However, the primary responsibility for the prevention and
detection of fraud rests with both those charged with governance
of the Company and management.
• We obtained an understanding of the legal and regulatory
frameworks that are applicable to the Company and determined
that the most significant are the Companies Act 2006, Section
1158 of the Corporation Tax Act 2010, the Listing Requirements
of the London Stock Exchange, the AIC SORP 2025 and The
Companies (Miscellaneous Reporting) Regulations 2018.
• We understood how Company is complying with those
frameworks by making enquiries of management to understand
how the Company maintains and communicates its policies and
procedures in these areas, and corroborated this by reviewing
supporting documentation such as the compliance manual,
correspondence with relevant authorities and minutes of meetings
of the Board of Directors and of the audit committee. We also
attended meetings of the audit committee during the period.
• We assessed the susceptibility of the Company’s financial
statements to material misstatement, including how fraud might
occur by discussing with management to understand where they
considered there was a susceptibility to fraud; and assessing any
whistleblowing incidences for those with a potential financial
reporting impact. We considered the internal control environment
of the group to address material misstatements, or that otherwise
prevent, deter and detect fraud and how management monitors
these controls including the risk of management override of
controls.
• Based on this understanding we designed our audit procedures
to identify non-compliance with such laws and regulations. Our
procedures involved enquiries of management, external legal
counsel, and those charged with governance.
A further description of our responsibilities for the audit of the financial
statements is located on the Financial Reporting Council’s website at
https://www.frc.org.uk/auditorsresponsibilities. This description forms
part of our auditor’s report.
OTHER MATTERS WE ARE REQUIRED TO ADDRESS
• Following the recommendation from the audit committee, we
were appointed by the Company on 9 June 2022 to audit the
financial statements for the year ending 31 December 2022 and
subsequent financial periods.
• The period of total uninterrupted engagement including previous
renewals and reappointments is 4 years, covering the years
ending 2022 to 2025.
• The audit opinion is consistent with the additional report to the
audit committee.
USE OF OUR REPORT
This report is made solely to the Company’s members, as a body, in
accordance with Chapter 3 of Part 16 of the Companies Act 2006.
Our audit work has been undertaken so that we might state to the
Company’s members those matters we are required to state to them
in an auditor’s report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility to anyone
other than the Company and the Company’s members as a body, for
our audit work, for this report, or for the opinions we have formed.
Vincent Bergin (Senior statutory auditor)
for and on behalf of Ernst & Young Chartered Accountants, Statutory
Auditor
Dublin
23 March 2026
65
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
66
Image shows a microscopic rendering of a white blood cell.
FINANCIAL STATEMENTS
67
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
For the year ended 31 December 2025 (in $000s except per share amounts)
68
Statement of Comprehensive Income
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
FINANCIAL STATEMENTS
Year ended 31December 2025 Year ended 31December 2024
Note Revenue Capital Total Revenue Capital Total
Income
Investment income 3 139,746 – 139,746 148,630 – 148,630
Other income 3 485 – 485 1,490 – 1,490
Net gains/(losses) on investments at
fair value
7 – 17, 516 17, 516 – (90) (90)
Net currency exchange gains/(losses) – 37 37 – (2) (2)
Total income/(expense) 140,231 17,553 157,784 150,120 (92) 150,028
Expenses
Management fee 4 (11,298) – (11,298) (11,997) – (11,997)
Performance fee 4 (14,431) – (14,431) (13,574) – (13,574)
Directors’ fees 4 (579) – (579) (551) – (551)
Other expenses 4 (1,589) – (1,589) (1,728) – (1,728)
Total expenses (27,897) – (27,897) (27,850) – (27,850)
Return on ordinary activities
after finance costs and before
taxation
112,334 17,553 129,887 122,270 (92) 122 ,178
Taxation on ordinary activities 5 – – – – – –
Return on ordinary activities
after finance costs and taxation
112,334 17,553 129,887 122,270 (92) 122 ,178
Net revenue and capital return
per ordinary share (basic and
diluted)
11 $0.0986 $0.0154 $0.1140 $0.1000 ($0.0001) $0.0999
The total column of this statement is the Company’s Statement of Comprehensive Income prepared in accordance with UK IAS. The supplementary
revenue and capital columns are presented for information purposes as recommended by the Statement of Recommended Practice (“SORP”)
issued by the Association of Investment Companies(“AIC”).
All items in the above Statement derive from continuingoperations.
There is no other comprehensive income, and therefore the return on ordinary activities after finance costs and taxation is also the total
comprehensiveincome.
The notes on pages 72 to 98 form part of these financialstatements.
For the year ended 31 December 2025 (In $000s)
69
Statement of Changes in Equity
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
FINANCIAL STATEMENTS
For the year ended 31December 2025
Note
Share
capital
Share
premium
account
Special
distributable
reserve
1
Capital
reserve
1
Revenue
reserve
1
Total equity
attributable to
shareholders of
the Company
Net assets attributable to shareholders at
1January 2025
13 , 73 9 6 0 7,12 5 548,561 (21,883) 34,136 1,181,678
Return on ordinary activities after finance costs
and taxation
– – – 17,553 112,334 129,887
Dividends paid to Ordinary Shareholders 6 – – – – (110,378) (110,378)
Cost of shares bought back for treasury – – (50,325) – – (50,325)
Net assets attributable to shareholders
at 31December 2025
13,739 6 07,12 5 498,236 (4,330) 36,092 1,150,862
For the year ended 31December 2024
Note
Share
capital
Share
premium
account
Special
distributable
reserve
1
Capital
reserve
1
Revenue
reserve
1
Total equity
attributable to
shareholders of
the Company
Net assets attributable to shareholders at
1January 2024
13 , 73 9 6 0 7,12 5 655,260 (21,791) 86,528 1,340,861
Return on ordinary activities after finance costs
and taxation
– – – (92) 122,270 12 2 ,178
Dividends paid to Ordinary Shareholders 6 – – – – (174,662) (174,662)
Cost of shares bought back for treasury
– –
(106,699)
– –
(106,699)
Net assets attributable to shareholders
at 31December 2024
13,739 6 07,12 5 548,561 (21,883) 34,136 1,181,678
1
The special distributable and revenue reserves can be distributed in the form of a dividend net of any deficit in the capital reserve. The total distributable amount as at 31December
2025 was $530 million (2024:$560.8 million). In order to maintain its status as an investment trust, the Company must pay out all income in the form of dividends.
The notes on pages 72 to 98 form part of these financialstatements.
As at 31 December 2025 (In $000s except per share amounts)
70
Statement of Financial Position
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
FINANCIAL STATEMENTS
Note 31December 2025 31December 2024
Non-current assets
Investments at fair value through profit or loss 7 1,102,232 1,162,200
1,102,232 1,162,200
Current assets
Trade and other receivables 8 53,600 31, 797
Cash and cash equivalents 9 12,587 5,620
66,187 37, 417
Total assets 1,168,419 1,199, 617
Current liabilities
Trade and other payables 10 17,557 17,884
Total current liabilities 17, 5 57 17,884
Total assets less current liabilities 1,150,862 1,181,733
Non-current liabilities
Deferred income 10 – 55
Net assets 1,150,862 1,181, 678
Represented by:
Share capital 13 13 , 73 9 13 , 73 9
Share premium account 6 0 7,12 5 6 0 7,12 5
Special distributable reserve 498,236 548,561
Capital reserve (4,330) (21,883)
Revenue reserve 36,092 34,136
Total equity attributable to shareholders of the Company 1,150,862 1,181, 678
Net asset value per ordinary share (basic and diluted) 12 $1.0192 $0.9963
The financial statements of BioPharma Credit PLC registered number 10443190 were approved and authorised for issue by the Board of
Directors on 23March 2026 and signed on its behalf by:
Harry Hyman
Chairman
23 March2026
The notes on pages 72 to 98 form part of these financialstatements.
For the year ended 31 December 2025 (In $000s)
71
Cash Flow Statement
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
FINANCIAL STATEMENTS
Note
Year ended
31December 2025
Year ended
31December 2024
Cash flows from operating activities
Investment income received 117,897 136,563
Other income received 475 1,925
Investment management fee paid (11,383) (12,330)
Performance fee paid (13,574) (12,044)
Other expenses paid (2,320) (2,202)
Net cash flow generated from operating activities 91,0 95 111, 912
Cash flow from investing activities
Purchase of investments
1
(83,750) –
Sales of investments
1
161, 23 4 39,072
Net cash flow generated from investing activities 77,484 39,072
Cash flow from financing activities
Dividends paid to Ordinary shareholders 6 (110,378) (174,662)
Share buybacks
2
(51,271) (105,753)
Net cash flow used in financing activities (161,649) (280,415)
Increase/(decrease) in cash and cash equivalents for the
year
6,930 (129,431)
Cash and cash equivalents at start of year 9 5,620 135,053
Revaluation of foreign currency balances 37 (2)
Cash and cash equivalents at end of year 9 12,587 5,620
1
BPCR Limited Partnership investments notincluded.
2
In 2025 the Company repurchased 56,828,879 shares, which is 4.14 per cent. of the total shares of the Company, at an average share price of 89 cents (2024: the Company
repurchased 116,622,535 shares, which is 8.5 per cent. of the total shares of the Company, at an average share price of 91cents.)
The notes on pages 72 to 98 form part of these financialstatements.
For the year ended 31 December 2025
FINANCIAL STATEMENTS
72
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
Notes to the Financial Statements
1. GENERAL INFORMATION
BioPharma Credit PLC is a closed-ended investment company incorporated and domiciled in England and Wales on 24October 2016 with
registered number 10443190. The registered office of the Company is 19th Floor, 51 Lime Street, London, EC3M7DQ.
The Company carries on the business as an investment trust company within the meaning of Sections 1158/1159 of the Corporation Tax
Act2010.
The Company is the ultimate parent of the group, with three subsidiaries. Please see note 14 for furtherinformation.
The Company’s Investment Manager is Pharmakon Advisors LP (“Pharmakon”). Pharmakon is a limited partnership established under the laws
of the State of Delaware. It is registered as an investment adviser with the Securities and Exchange Commission (“SEC”) under the United States
Investment Advisers Act of 1940, asamended.
Pharmakon is authorised as an Alternative Investment Fund Manager (“AIFM”) under the Alternative Investment Fund Managers Directive
(“AIFMD”). Pharmakon has, with the consent of the Directors, delegated certain administrative duties to Waystone Administration Solutions
(UK)Limited.
2. ACCOUNTING POLICIES
A) BASIS OF PREPARATION
The Company’s annual financial statements covers the year from 1January 2025 to 31December 2025 and have been prepared in accordance
with UK-adopted International Accounting Standards (UK IAS) and as applied in accordance with the Disclosure Guidance and Transparency
Rules sourcebook of the Financial Conduct Authority (FCA) and the Statement of Recommended Practice “Financial Statements of Investment
Trust Companies and Venture Capital Trusts” (the “AIC SORP”) issued by “The Association of Investment Companies” (issued in July 2022) for the
financial statements of investment trust companies and venture capital trusts, except to any extent where it is not consistent with the requirements of
UK IAS. The financial statements have been prepared in accordance with the Companies Act 2006, as applicable to companies reporting under
thosestandards.
The financial statements are presented in US dollars, being the functional currency of the Company and rounded to the nearest thousand, except
where otherwise indicated. The financial statements have been prepared on a going concern basis under historical cost convention, except for the
measurement at fair value of investments measured at fair value through profit orloss.
ASSESSMENT AS AN INVESTMENT ENTITY
Entities that meet the definition of an investment entity within IFRS 10 “Consolidated Financial Statements” are required to measure their subsidiaries
at fair value through profit or loss rather than consolidate the entities. The criteria which define an investment entity are as follows:
• an entity that obtains funds from one or more investors for the purpose of providing those investors with investment services;
• an entity that commits to its investors that its business purpose is to invest funds solely for returns from capital appreciation, investment income
or both; and
• an entity that measures and evaluates the performance of substantially all of its investments on a fair valuebasis.
The Directors have concluded that the Company meets the characteristics of an investment entity, in that it has more than one investor and its
investors are not related parties; holds a portfolio of investments, predominantly in the form of loans which generates returns through interest
income. All investments, including its subsidiary BPCR Limited Partnership, are reported at fair value to the extent allowed by UKIAS.
B) PRESENTATION OF STATEMENT OF COMPREHENSIVE INCOME
In order to better reflect the activities of an investment trust company and in accordance with guidance issued by the AIC, supplementary
information which analyses the Statement of Comprehensive Income between items of a revenue and capital nature has been prepared alongside
the IncomeStatement.
C) SEGMENTAL REPORTING
The Directors are of the opinion that the Company has one operating and reportable segment being the investment in debt assets primarily secured
by cash flows, including royalties, derived from the sale of approved life sciencesproducts.
Notes to the Financial Statements continued
FINANCIAL STATEMENTS
73
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
2. ACCOUNTING POLICIES (CONTINUED)
D) INVESTMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS
The principal activity of the Company is to invest in interest-bearing debt assets with a contractual right to future cash flows derived from royalties
or sales of approved life sciences products. Most of the Company’s investments are held indirectly via its subsidiary, BPCR Limited Partnership. In
accordance with UK IAS, the financial assets are measured at fair value through profit or loss. They are accounted for on their trade date at fair
value, which is equivalent to the cost of the investment. The fair value of the asset reflects any contractual amortisingbalance.
The fair value hierarchy consists of the following three levels:
• Level 1 – Quoted prices (unadjusted) in active markets for identical assets or liabilities
• Level 2 – Valuation techniques using observable inputs
• Level 3 – Valuation techniques using significant unobservable inputs
Level 1 investments are priced by unadjusted quoted prices in activemarkets.
Level 2 investments may be valued using market data obtained from external, independent sources. The data used could include quoted prices for
similar assets and liabilities in active markets, prices for identical or similar assets and liabilities in inactive markets, or models with observableinputs.
For unlisted level 3 investments where the market for a financial instrument is not active, fair value is established using valuation techniques in
accordance with the International Private Equity and Venture Capital Valuation (“IPEV”) Guidelines (issued in December 2022), which may
include recent arm’s length market transactions between knowledgeable, willing parties, if available, reference to the current fair value of another
instrument that is substantially the same, discounted cash flow analysis and option pricing models. Where there is a valuation technique commonly
used by market participants to price the instrument and that technique has proved reliable from estimates of prices obtained in actual market
transactions, that technique is utilised. More information can be found in Note 2(n)below.
Unlisted investments often require the manager to make estimates and judgements and apply assumptions or subjective judgement to future events
and other matters that may affect fair value. For unlisted investments valued using a discounted cash flow analysis, the key judgements are the size
of the market, pricing, projected sales of the product at trade date and future growth and other factors that will support the repayment of a senior
secured or royalty debtinstrument.
Changes in the fair value of investments held at fair value through profit or loss, and gains or losses on disposal, are recognised in the Statement
of Comprehensive Income as gains or losses from investments held at fair value through profit or loss. Transaction costs incurred on the purchase
and disposal of investments are included within the cost or deducted from the proceeds of the investments. All purchases and sales are accounted
for on tradedate.
E) FOREIGN CURRENCY
Transactions denominated in currencies other than US dollars are recorded at the rates of exchange prevailing on the date of the transaction. Items
which are denominated in foreign currencies are translated at the rates prevailing on the balance sheet date. Any gain or loss arising from a change
in exchange rate subsequent to the date of the transaction is included as an exchange gain or loss in the Statement of ComprehensiveIncome.
F) INCOME
There are seven main sources of revenue for the Company: interest income, income from subsidiaries, royalty revenue, make-whole and prepayment
income, dividends, exit consideration and the gain or loss on marketablesecurities.
Interest income is recognised when it is probable that the economic benefits will flow to the Company. Interest is accrued on a time basis,
by reference to the principal outstanding and the effective interest rate that is applicable. Accrued interest is included within trade and other
receivables on the Statement of FinancialPosition.
The Company recognises accrued income for investments that it holds directly. The Company also holds an investment in BPCR Limited Partnership,
its wholly owned subsidiary which it measures at fair value through profit or loss rather than being consolidated. BPCR Limited Partnership also
recognises accrued income for investments it holds directly. When the accrued income is recorded at BPCR Limited Partnership, the Company
recognises the income in capital within the Statement of Comprehensive Income. When the Company’s right to receive the income is established,
funds are transferred from the Partnership to the Company and income is transferred to revenue within the Statement of ComprehensiveIncome.
Notes to the Financial Statements continued
FINANCIAL STATEMENTS
74
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
2. ACCOUNTING POLICIES (CONTINUED)
F) INCOME (CONTINUED)
Make-whole and prepayment income is recognised when payments are received by BPCR Limited Partnership and transferred from the Partnership
to the Company and is recorded to revenue within the Statement of ComprehensiveIncome.
Dividends are receivable on equity shares and recognised on the ex-dividend date. Where no ex-dividend date is quoted, dividends are
recognised when the Company’s right to receive payment is established. Dividends from investments in unquoted shares and securities are
recognised when they becomereceivable.
Some investments include additional consideration in the form of structuring fees, which are paid on completion of the transaction. As the investments
are classified as level 3 in the fair value hierarchy, there is no observable evidence of the fair value of the investments excluding the fees, therefore
the fees should be included in the day one fair value of the investments. Such fees are included in the fair value of the investment and released to
the Statement of Comprehensive Income over the life of the investment. We consider incorporating the fees in the fair value gains and losses over
the life of the loans to be more reflective of the period over which the benefit is received. These fees are allocated to revenue within the Statement
of ComprehensiveIncome.
Bank interest and other interest receivable are accounted for on an accrualsbasis.
G) DIVIDENDS PAID TO SHAREHOLDERS
The Company intends to pay dividends in US Dollars on a quarterly basis, however, shareholders can elect to have dividends paid in sterling.
The Company may, where the Directors consider it appropriate, use the reserve created by the cancellation of its share premium account to
paydividends.
The Company intends to comply with the requirements for maintaining investment trust status for the purposes of section 1158 of the Corporation
Tax Act 2010 (as amended) regarding distributable income. As such, the Company will distribute amounts such that it does not retain in respect of
an accounting period an amount greater than 15 per cent. of its income (as calculated for UK tax purposes) for thatperiod.
H) EXPENSES
All expenses are accounted for on an accruals basis. Expenses, including investment management fees, performance fees and finance costs, are
charged through the revenue account except as follows:
• expenses which are incidental to the acquisition or disposal of an investment are treated as capital costs and separately identified and
disclosed in Note 4; and
• expenses of a capital nature are accounted for through the capitalaccount.
The performance fee is calculated in accordance with the details in Note 4(b). Any performance fee triggered, whether payable or deferred, is
recognised in the Statement of Comprehensive Income. Where a performance fee is payable it is treated as a current liability in the Statement of
Financial Position. Where a performance fee is deferred for more than a year, it is treated as a non-current liability in the Statement of Financial
Position. It becomes payable to the Investment Manager at the end of the first performance period in respect to which the compounding condition
issatisfied.
I) TRADE, OTHER RECEIVABLES AND OTHER ASSETS
Trade, other receivables and other assets is recognised and carried at amortised cost as the Company collects contractual interest payments from
its borrowers. An allowance for estimated unrecoverable amounts are measured and recognised where necessary. The Company assesses, on a
forward-looking basis, the expected losses associated with its trade and otherreceivables.
J) CASH AND CASH EQUIVALENTS
Cash comprises cash in hand and demand deposits, which accrues interest. Cash equivalents are level 1 assets on the fair value hierarchy and
are short-term with original maturities of three months or less and highly liquid investments, that are readily convertible to known amounts of cash
and subject to insignificant risk of changes invalue.
Cash and cash equivalents includes interest and income from money marketfunds.
Notes to the Financial Statements continued
FINANCIAL STATEMENTS
75
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
2. ACCOUNTING POLICIES (CONTINUED)
K) TRADE AND OTHER PAYABLES
Trade and other payables are recognised and carried at amortised cost, do not carry any interest and are short-term innature.
L) TAXATION
It is the intention of the Directors to conduct the affairs of the Company so as to satisfy the conditions by HMRC as an investment trust under section
1158 of the Corporation Tax Act 2010 (as amended) and pursuant to regulations made under section 1159 of the Corporation Tax Act 2010.
The Company may, if it so chooses, designate as an ‘interest distribution’ all or part of the amount it distributes to shareholders as dividends, to
the extent that it has ‘qualifying interest income’ for the accounting period. Were the Company to designate any dividend it pays in this manner, it
should be able to deduct such interest distributions from its income in calculating its taxable profit for the relevant accounting period. The Company
intends to elect for the ‘streaming’ regime to apply to the dividend payments it makes to the extent that it has such ‘qualifying interest income’.
Shareholders in receipt of such a dividend will be treated, for UK tax purposes, as though they had received a payment of interest, which results
in a reduction of the corporation tax payable by theCompany.
Tax on the profit or loss for the year comprises current and deferred tax. Corporation tax is recognised in the Statement of ComprehensiveIncome.
Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at the balance sheet
date and any adjustment to tax payable in respect of previous periods. The tax effect of different items of expenditure is allocated between revenue
and capital on the same basis as the particular item to which it relates, using the Company’s marginal method of tax, as applied to those items
allocated to revenue, for the accountingperiod.
Deferred tax is provided, using the liability method, on all temporary differences at the balance sheet date between the tax basis of assets and
liabilities and their carrying amount for financial reporting purposes. Deferred tax liabilities are measured at the tax rates that are expected to
apply to the period when the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the balance
sheetdate.
M) SHARE CAPITAL AND RESERVES
The share capital represents the nominal value of the Company’s ordinaryshares.
The share premium account represents the excess over nominal value of the fair value of consideration received for the Company’s ordinary
shares, net of expenses of the share issue. This reserve cannot bedistributed.
The special distributable reserve was created on 29June 2017 to enable the Company to buy back its own shares and pay dividends out of such
distributable reserve, in each case when the Directors consider it appropriate to do so, and for other corporatepurposes.
The capital reserve represents realised and unrealised capital and exchange gains and losses on the disposal and revaluation of investments and
of foreign currency items. The realised capital reserve can be used for the repurchase of shares. This reserve cannot bedistributed.
The revenue reserve represents retained profits from the income derived from holding investment assets less the costs and interest on cash balances
associated with running the Company. This reserve can bedistributed.
N) CRITICAL ACCOUNTING ESTIMATES AND ASSUMPTIONS
The preparation of these financial statements in conformity with UK IAS requires the Directors to make accounting estimates which will not always
equal the actual results. The Directors also need to exercise judgement in applying the Company’s accountingpolicies.
This note provides an overview of the areas that involve a higher degree of judgement or complexity and of items which are more likely to be
materially adjusted due to estimates and judgements included in other notes, together with information about the basis of calculation for each line
in the financialstatements.
JUDGEMENTS
Using the criteria in Note 2(a) above, the Directors have judged that the Company meets the characteristics of an investment entity, in that it has
more than one investor and its investors are not related parties; holds a portfolio of investments, predominantly in the form of loans which generates
returns through interestincome.
Notes to the Financial Statements continued
FINANCIAL STATEMENTS
76
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
2. ACCOUNTING POLICIES (CONTINUED)
ESTIMATES AND ASSUMPTIONS
In particular, judgements and estimates are made in determining the fair valuation of unquoted investments for which there is no observable market
and may cause material adjustments to the carrying value of those investments. Determining fair value of investments with unobservable market
inputs is an area involving management judgement, requiring assessment as to whether the value of assets can be supported by the net present
value of future cash flows derived from such assets using cash flow projections which have been discounted at an appropriate rate. In calculating
the net present value of the future cash flows, certain assumptions are required to be made including management’s expectations of short and
long term growth rates in product sales and the selection of discount rates to reflect the risks involved. Additionally, when the issuer of an unlisted
investment held is subject to a takeover bid which, if completed, would entitle the company to additional income such as make-whole premium,
or would otherwise change the timing of receipt of cashflows, the company is required to estimate the likelihood of such a bid being successful,
and the timing of transaction completion. These are valued in accordance with Note 2(d) above and using the valuation techniques described
in Note 7below.
Also, estimates including cash flow projections, discount rates and growth rates in product sales are made when determining any deferred
performance fee; this may be affected by future changes in the Company’s portfolio and other assets andliabilities.
Any deferred performance fee is calculated in accordance with Note 4(b) below and is recognised in accordance with Note 2(h)above.
These judgements and estimates are reviewed on an ongoing basis. Revisions to these judgements and estimates are also reviewed on an ongoing
basis. Revisions are recognisedprospectively.
O) ACCOUNTING STANDARDS NOT YET EFFECTIVE
There are no standards or amendments not yet effective which have a material impact on theCompany.
The standards or amendments not yet effective that will be adopted on their effective date are:
IFRS 9 FINANCIAL INSTRUMENTS AND IFRS 7 FINANCIAL INSTRUMENTS: DISCLOSURES
In May 2024, the IASB issued Amendments to the Classification and Measurement of Financial Instruments which amended requirements related
to settling financial liabilities using an electronic payment system and assessing contractual cash flow characteristics of financial assets, including
those with environmental, social and governance (ESG)-linked features. The IASB also amended disclosure requirements relating to investments
in equity instruments designated at fair value through other comprehensive income and added disclosure requirements for financial instruments
with contingent features that do not relate directly to basic lending risks and costs. The amendments will be effective for annual reporting periods
beginning on or after 1 January 2026.
The amendments are not expected to have a material impact on the Company’s Financial Statements.
IFRS 18 PRESENTATION AND DISCLOSURE IN FINANCIAL STATEMENTS
The new standard IFRS 18 was issued in April 2024 and is effective for annual reporting periods beginning on or after 1 January 2027 but earlier
application is permitted. This new standard replaces IAS 1 Presentation of Financial Statements and amends IAS 7 Statement of Cash Flows.
IFRS18 introduces three defined categories for income and expenses – operating, investing and financing – to improve the structure of the income
statement, and requires all companies to provide new defined subtotals, including operating profit. IFRS 18 will require disclosure of explanations
of company-specific measures that are related to the income statement, referred to as management-defined performance measures. IFRS 18 sets
out enhanced guidance on how to organise information and whether to provide it in the financial statements or in the notes. The Company will
apply IFRS 18 for annual reporting periods beginning on 1 January 2027.
The Company is still assessing the impact of IFRS 18, which has been issued but is not yet effective. While the presentation of the Statement of
Comprehensive Income will change on implementation, the valuation and measurement of balances will not be impacted. The Company will
continue to assess the impact of IFRS 18 as additional guidance is released prior to implementation. No other standards that have been issued but
are not yet effective are likely to materially affect the Company’s Financial Statements.
Notes to the Financial Statements continued
FINANCIAL STATEMENTS
77
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
3. INCOME
Year ended
31December 2025
$000
Year ended
31December 2024
$000
Income from investments
US unfranked investment income from BPCR LP 138,492 148,485
US fixed interest investment income 1,137 –
Additional consideration received
1
117 14 5
139,746 148,630
Other income
Interest income from liquidity/money market funds 4 81 1,488
Other interest 4 2
485 1,490
Total income 140,231 150,120
1
In 2025 $117,000 was recorded as additional income from the Company’s investment in Optinose Warrants (2024:$145,000).
4. FEES AND EXPENSES
EXPENSES
Year ended 31December 2025 Year ended 31December 2024
Revenue
$000
Capital
$000
Total
$000
Revenue
$000
Capital
$000
Total
$000
Management fee (note 4a) 11,298 – 11,298 11 , 9 9 7 – 11 , 9 9 7
Performance fee (note 4b) 14,431 – 14,431 13,574 – 13,574
Directors’ fees (note 4c) 579 – 579 551 – 5 51
Other expenses
Company Secretarial fee 12 0 – 12 0 119 – 119
Administration fee 13 9 – 13 9 135 – 135
Legal & professional fees 243 – 243 192 – 192
Public relations fees 164 – 16 4 180 – 18 0
Directors’ and Officers’ liability insurance 91 – 91 97 – 97
Auditors’ remuneration – Statutory audit 302 – 302 307 – 307
Auditors’ remuneration – Other audit related services – Half year
review and agreed upon procedures
89 – 89 87 – 87
VAT
1
(135) – (135) 13 0 – 13 0
Printing fees 102 – 102 87 87
Registrars’ fees 80 80 72 72
National Insurance 79 – 79 67 – 67
Other expenses 315 – 315 255 – 255
1,589 – 1,589 1,728 – 1,728
Total expenses 27,897 – 27,897 27,850 – 27,850
1
The negative VAT expense in 2025 is due to reclaiming VAT accrued in 2023 and2024.
Notes to the Financial Statements continued
FINANCIAL STATEMENTS
78
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
4. FEES AND EXPENSES (CONTINUED)
A) INVESTMENT MANAGEMENT FEE
With effect from the Initial Admission, the Investment Manager is entitled to a management fee (“Management Fee”) calculated on the following
basis: (1/12 of 1 per cent. of the NAV on the last business day of the month in respect of which the Management Fee is to be paid (calculated
before deducting any accrued Management Fee in respect of such month)) minus (1/12 of$100,000).
The Management Fee payable in respect of any quarter will be reduced by an amount equal to the Company’s pro rata share of any transaction
fees, topping fees, break-up fees, investment banking fees, closing fees, consulting fees or other similar fees which the Investment Manager (or an
affiliate) receives in connection with transactions involving investments of the Company (“Transaction Fees”). The Company’s pro rata share of any
Transaction Fees will be in proportion to the Company’s economic interest in the investment(s) to which such Transaction Feesrelate.
B) PERFORMANCE FEE
Subject to: (i) the NAV attributable to the Ordinary Shares as at the end of a performance period representing a minimum of 6 per cent. annualised
rate of return on the Company’s IPO gross proceeds (adjusted for dividends, share issues and buybacks as appropriate), (ii) the total return on
the NAV attributable to the Ordinary Shares (adjusted for dividends, share issues and buybacks as appropriate) exceeding 6 per cent. over such
performance period, and (iii) a high watermark (which is the total return on the NAV (calculated per Ordinary Share) as at the end of the last
performance period in respect of which a performance fee was payable to the Investment Manager), the Investment Manager will be entitled to
receive a performance fee equal to the lesser of: (a) 50 per cent. of the total return above 6 per cent.; and (b) 10 per cent. of the total return over
such performance period provided always that the amount of any performance fee payable to the Investment Manager will be reduced to the
extent necessary to ensure that after account is taken of such fee, condition (iii) above remainssatisfied.
Where the Investment Manager is not entitled to a performance fee solely because condition (i) has not been satisfied, such fee will be deferred
and paid in a subsequent performance period in which such condition is satisfied. Where condition (i) is satisfied in a performance period but the
payment of a performance fee (or any deferred performance fee from previous performance periods) in full would result in that condition failing,
the Investment Manager shall be entitled to such a portion of such fee that does not result in the failure of the condition (i) above and the balance
would be deferred to a future performanceperiod.
Any performance fee (whether deferred or otherwise) shall be paid as soon as practicable after the end of the relevant performance period and,
in any event, within 15 business days of the publication of the Company’s audited annual financial statements relating to suchperiod.
Where the payment of performance fee (or any deferred performance fee from previous performance periods) in full would result in the failure of
condition (i) above, the Investment Manager shall only be entitled to 50 per cent. of such fee that does not result in the failure of condition (i) with
the balance being deferred to a future performanceperiod.
If, during the last month of a performance period, the Shares have, on average, traded at a discount of 1 per cent. or more to the NAV per Share
(calculated by comparing the middle market quotation of the Shares at the end of each business day in the month to the prevailing published
NAV per Share (exclusive of any dividend declared) as at the end of such business day and averaging this comparative figure over the month),
the Investment Manager shall (or shall procure that its Associate does) apply 50 per cent. of any Performance Fee paid by the Company to
the Investment Manager (or its Associate) in respect of that performance period (net of all taxes and charges applicable to such portion of
the Performance Fee) to make market acquisitions of Shares (the “Performance Shares”) as soon as practicable following the payment of the
Performance Fee by the Company to the Investment Manager (or its Associate) and at least until such time as the Shares have, on average, traded
at a discount of less than 1 per cent. to the NAV per Share over a period of five business days (calculated by comparing the middle market
quotation of the Shares at the end of each such business day to the prevailing published NAV per Share (exclusive of any dividend declared) and
averaging this comparative figure over the period of five business days). The Investment Manager’s obligation:
1) shall not apply to the extent that the acquisition of the Performance Shares would require the Investment Manager to make a mandatory bid
under Rule 9 of the Takeover Code; and
2) shall expire at the end of the performance period which immediately follows the performance period to which the obligationrelates.
Notes to the Financial Statements continued
FINANCIAL STATEMENTS
79
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
4. FEES AND EXPENSES (CONTINUED)
The below table shows the accrued and payable performancefee.
As at 31December 2025
$000
As at 31December 2024
$000
Accrued performance fee 14,431 13,574
Performance fee payable 14,431 13,574
C) DIRECTORS
Each of the Directors is entitled to receive a fee from the Company at such rate as may be determined in accordance with the Articles. The
Directors’ remuneration for 2025 is $87,200 per annum for each Director other than:
• the Chairman, who will receive an additional $37,300 per annum; and
• the Chairman of the Audit and Risk Committee, who will receive an additional $18,600 perannum.
5. TAXATION ON ORDINARY ACTIVITIES
It is the intention of the Directors to conduct the affairs of the Company so as to satisfy the conditions for approval of the Company by HMRC as
an investment trust under Section 1158 of the Corporation Tax Act 2010 (as amended) and pursuant to regulations made under Section 1159 of
the Corporation Tax Act 2010. As an investment trust, the Company is exempt from corporation tax on capitalgains.
The current taxation charge for the year is different from the standard rate of corporation tax in the UK of 25 per cent., the effective tax rate was
0per cent. The differences are explainedbelow.
Year ended 31December 2025 Year ended 31December 2024
Revenue
$000
Capital
$000
Total
$000
Revenue
$000
Capital
$000
Total
$000
Total return on ordinary activities before taxation 112,334 17,553 129,887 122,270 (92) 12 2 ,178
Theoretical tax at UK Corporation tax rate of 25.00% (2024:
25.00%)
28,084 4,388 32,472 30,568 (23) 30,545
Effects of:
Capital items that are not taxable – (4,388) (4,388) – 23 23
Tax deductible interest distributions (28,084) – (28,084) (30,568) – (30,568)
Total tax charge – – – – – –
At 31December 2025, the Company had no unprovided deferred taxliabilities.
At that date, based on current estimates and including the accumulation of net allowable losses, the Company had no unrelievedlosses.
Deferred tax is not provided on capital gains and losses arising on the revaluation or disposal of investments because the Company meets (and
intends to continue for the foreseeable future to meet) the conditions for approval as an Investment Trustcompany.
Notes to the Financial Statements continued
FINANCIAL STATEMENTS
80
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
6. DIVIDENDS
Year ended 31December 2025 Year ended 31December 2024
Revenue
$000
Capital
$000
Total
$000
Revenue
$000
Capital
$000
Total
$000
In respect of the previous year ended 31December 2024:
Fourth interim dividend of $0.0175 per Ordinary share 20,654 – 20,654 – – –
Special dividend of $0.0114 per Ordinary share 13,482 – 13,482 – – –
In respect of the previous year ended 31December 2023:
Third interim dividend of $0.0175 per Ordinary share – – – 22,797 – 22,797
Special dividend of $0.0200 per Ordinary share – – – 26,053 – 26,053
Fourth interim dividend of $0.0175 per Ordinary share – – – 22,014 – 22,014
Special dividend of $0.0121 per Ordinary share – – – 15 ,19 5 – 15,19 5
Special dividend of $0.0004 per Ordinary share – – – 469 – 469
In respect of the current year:
First interim dividend of $0.0175 per Ordinary share (2024: $0.0175 per
Ordinary share)
19, 78 0 – 19, 78 0 21,939 – 21,939
Second interim dividend of $0.0175 per Ordinary share (2024: $0.0175
per Ordinary share)
19, 76 2 – 19, 762 21, 334 – 21, 334
Third interim dividend of $0.0175 per Ordinary share (2024: $0.0175
per Ordinary share)
19, 76 2 – 19, 762 20,935 – 20,935
Special dividend of $0.0150 per Ordinary share (2024: $0.0204 per
Ordinary share)
16,938 – 16,938 23,926 – 23,926
110,378 – 110,378 174,662 – 174,662
Set out below are the interim dividends paid or proposed on Ordinary Shares in respect of the financial year, which is the basis on which the
requirements of Section 1159 of the Corporation Tax Act 2010 areconsidered.
Year ended 31December 2025 Year ended 31December 2024
Revenue
$000
Capital
$000
Total
$000
Revenue
$000
Capital
$000
Total
$000
First interim dividend of $0.0175 per Ordinary share (2024: $0.0175 per
Ordinary share)
19, 78 0 – 19, 78 0 21,939 – 21,939
Second interim dividend of $0.0175 per Ordinary share (2024: $0.0175
per Ordinary share)
19, 76 2 – 19, 762 21, 334 – 21, 334
Third interim dividend of $0.0175 per Ordinary share (2024: $0.0175
per Ordinary share)
19, 76 2 – 19, 762 20,935 – 20,935
Special dividend of $0.0150 per Ordinary share (2024: $0.0204 per
Ordinary share)
16,938 – 16,938 23,926 – 23,926
Fourth interim dividend of $0.0175 per Ordinary share (2024: $0.0175
per Ordinary share)
19, 76 2 – 19, 76 2 20,654 – 20,654
Special dividend of $0.0145 per Ordinary share (2024: $0.0114
per Ordinary share)
16,330 – 16,330 13,482 – 13,482
112,334 – 112,334 122,270 – 122,270
On 10February 2026, the Board approved a fourth interim dividend, for the year ended 31December 2025, of $0.0175 per Ordinary Share
and a special dividend of $0.0145 per Ordinary Share, both payable on 20 March 2026.
Past performance is not an indication of future performance.
In accordance with IFRS, these dividends have not been included as a liability in these financialstatements.
Notes to the Financial Statements continued
FINANCIAL STATEMENTS
81
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
7. INVESTMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS
As at
31December 2025
$000
As at
31December 2024
$000
Investment portfolio summary
Listed fixed interest investments at fair value through profit or loss 73,858 –
Unlisted investments in subsidiaries at fair value through profit or loss 1,028,374 1,162 ,136
Unlisted fixed interest investments at fair value through profit or loss – 64
1,102,232 1,162,200
Year ended 31December 2025
Listed
fixed interest
investments
$000
Unlisted
investments in
subsidiaries
$000
Unlisted
fixed interest
investments
$000
Total
$000
Investment portfolio summary
Opening cost at beginning of year – 1,185,872 8 91 1,186,763
Opening unrealised losses at beginning of year – (23,736) (827) (24,563)
Opening fair value at beginning of year – 1,162 ,136 64 1,162,200
Movements in the year
Purchases at cost 83,750 – – 83,750
Redemption and sales proceeds (26,234) (135,000) – (161,234)
Realised gain/(loss) on sale of investments 7, 414 – (891) 6,523
Change in unrealised gains/losses 8,928 1,238 827 10,993
Closing fair value at the end of the year 73,858 1,028,374 – 1,102,232
Closing cost at end of year 64,930 1,050,872 – 1,115,802
Closing unrealised gains/(losses) at end of year 8,928 (22,498) – (13,570)
Closing fair value at the end of the year 73,858 1,028,374 – 1,102,232
Year ended 31December 2024
Listed
investments
$000
Unlisted
investments in
subsidiaries
$000
Unlisted
fixed interest
investments
$000
Total
$000
Investment portfolio summary
Opening cost at beginning of year – 1,224,944 8 91 1,225,835
Opening unrealised losses at beginning of year – (23,846) (627) (24,473)
Opening fair value at beginning of year – 1,201,098 264 1,201,362
Movements in the year
Redemption and sales proceeds – (39,072) – (39,072)
Change in unrealised losses – 110 (200) (90)
Closing fair value at the end of the year – 1,162,136 64 1,162,200
Closing cost at end of year – 1,185,872 891 1,186,763
Closing unrealised losses at end of year – (23,736) (827) (24,563)
Closing fair value at the end of the year – 1,162,136 64 1,162,200
Notes to the Financial Statements continued
FINANCIAL STATEMENTS
82
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
7. INVESTMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS (CONTINUED)
Year ended
31December 2025
$000
Year ended
31December 2024
$000
Realised gains on sale of investments 6,523 –
Unrealised gains 10,993 (90)
17, 516 (90)
The Company is required to classify fair value measurements using a fair value hierarchy that reflects the significance of the inputs used in making
the measurements. The fair value hierarchy consists of the following three levels:
• Level 1 – Quoted prices (unadjusted) in active markets for identical assets orliabilities.
• Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (that is, as prices)
or indirectly (that is, derived fromprices).
• Level 3 – Inputs for the asset or liability that are not based on observable market data (unobservableinputs).
The level of the fair value hierarchy, within which the fair value measurement is categorised, is determined on the basis of the lowest level input that
is significant to the fair value of theinvestment.
As at 31December 2025
Financial assets
Level 1
$000
Level 2
$000
Level 3
$000
Total
$000
Investment portfolio summary
Listed fixed interest investments at fair value through profit or loss – 73,858 – 73,858
Unlisted investments in subsidiaries measured at fair value through profit or loss – – 1,028,374 1,028,374
– 73,858 1,028,374 1,102,232
Liquidity/money market funds 12,159 – – 12,159
Total 12,15 9 73,858 1,028,374 1,114,391
As at 31December 2024
Level 1
$000
Level 2
$000
Level 3
$000
Total
$000
Investment portfolio summary
Unlisted investments in subsidiaries measured at fair value through profit or loss – – 1,162 ,136 1,162 ,136
Unlisted fixed interest investments at fair value through profit or loss – 64 – 64
– 64 1,162,136 1,162,200
Liquidity/money market funds 5,466 – – 5,466
Total 5,466 64 1,162,136 1,167,666
Notes to the Financial Statements continued
FINANCIAL STATEMENTS
83
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
7. INVESTMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS (CONTINUED)
A reconciliation of fair value measurements in Level 3 is set outbelow.
LEVEL 3 FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS
Year ended 31December 2025
Unlisted investments in
subsidiaries
$000
Total
$000
Opening balance 1,162 ,136 1,162 ,136
Redemptions
1
(135,000) (135,000)
Unrealised gains 1,238 1,238
Closing balance at 31December 2025 1,028,374 1,028,374
Year ended 31December 2024
Unlisted
investments
$000
Total
$000
Opening balance
1,201,098
1,201,098
Redemptions
1
(39,072) (39,072)
Unrealised gains 110 110
Closing balance at 31December 2024 1,162,136 1,162,136
1
Redemptions are the proceeds received from the repayment ofinvestments.
There were no transfers between levels during theyear.
VALUATION TECHNIQUES
Unrealised gains and losses recorded on Level 1 financial instruments are reported in net gains on investments at fair value on the Statement of
Comprehensive Income. The fund administrator utilises quoted prices in active markets that they have access to and the Investment Manager
verifies the quoted prices onBloomberg.
Unrealised gains and losses recorded on Level 2 and 3 financial instruments are reported in net gains on investments at fair value on the Statement
of Comprehensive Income. Level 2 and Level 3 financial instruments are fair valued using inputs that reflect the Investment Manager’s best estimate
of what market participants would use in pricing the assets or liabilities at the measurement date. Consideration is given to the risk inherent in the
valuation techniques and the risk inherent in the inputs of themodel.
Level 2 financial instruments are fair valued using the closing price or bid price.
Level 3 financial instruments are fair valued using a discounted cash flow methodology. For capped royalty investments, discount rates are applied
to the consensus forecasts or the manager’s forecast for sales of the underlying products to determine fair value. The significant unobservable input
used in the fair value measurement of the Company’s Level 3 investments is the specific discount rate used for each investment summarised in the
tablebelow.
Investments held in subsidiaries, namely BPCR Limited Partnership, are based on the fair value of the investments held in thoseentities.
Notes to the Financial Statements continued
FINANCIAL STATEMENTS
84
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
7. INVESTMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS (CONTINUED)
The Company’s unlisted investments, including those of its wholly owned subsidiary BPCR Limited Partnership, are all classified as Level 3
investments. The fair values of the unlisted investments have been determined principally by reference to discounted cash flows. The significant
unobservable input used is detailed below:
As at 31December 2025
Assets
Fair value at Level 3
financial assets at fair
value through profit
or loss
$000
Valuation technique
Unobservable
input
Discount
rate
2
Fair value
sensitivity to a
100bps decrease in
the discount rate
$000
Fair value
sensitivity to a
100bps increase in
the discount rate
$000
Assets held by BPCR
Limited Partnership
1
Alphatec 35 ,15 8 Discounted cash flow Discount rate 11.0% 35, 755 34,577
BMS 10,083 Discounted cash flow Discount rate –
3
10,083
3
10,083
3
Evolus 62,074 Discounted cash flow Discount rate 9.5% 64,202 60,042
Geron 48,985 Discounted cash flow Discount rate 10.2% 50,469 47,562
Insmed 217,295 Discounted cash flow Discount rate 11.0% 222,332 212,429
Novocure 98,333 Discounted cash flow Discount rate 10.9% 100,419 96,313
Paratek 24,794 Discounted cash flow Discount rate –
4
25,285 24,319
Precigen 48,854 Discounted cash flow Discount rate 11.8% 50,287 47,479
Tarsus 36,821 Discounted cash flow Discount rate 11.8% 37, 76 6 35,909
UroGen 49,804 Discounted cash flow Discount rate 11 . 7 % 50,574 49,053
Valneva 29,439 Discounted cash flow Discount rate 10.3% 30,515 28,416
Other net assets of BPCR
Limited Partnership
5
366,734
6
Amortised cost – 366,734 366,734
1,028,374 1,044,421 1,012,916
1
The Company holds an investment in BPCR Limited Partnership, its wholly owned subsidiary, which it measures at fair value through profit or loss rather than consolidate.
2
For those interest-bearing loans with variable rates, the discount rates and fair value sensitivities are calculated based on the variable rates extant at 31 December 2025.
3
Fair value of final receivable on the purchased payments referencing sales for the quarter ending 31 December 2025 is due to be received in March 2026.
4
Since Paratek is a privately held company, details about the loan are not publicly available, but terms are generally comparable with other investments.
5
Other net assets at amortised cost consists principally of assets where amortised cost equates to fair value, such as cash and cash equivalents and short term receivables and payables.
6
This amount is comprised of total cash held at BPCR LP at 31 December 2025 totaling $422.3 million that is invested in level 1 money market funds and $55.6 million of other payables
held at an amortised cost.
Notes to the Financial Statements continued
FINANCIAL STATEMENTS
85
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
7. INVESTMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS (CONTINUED)
As at 31December 2024
Assets
Fair value at Level 3
financial assets at fair
value through profit
or loss
$000
Valuation technique
Unobservable
input
Discount
rate
1
Fair value
sensitivity to a
100bps decrease in
the discount rate
$000
Fair value
sensitivity to a
100bps increase in
the discount rate
$000
Assets held by BPCR
Limited Partnership
1
Alphatec 3 4 , 719 Discounted cash flow Discount rate 12.1% 35,547 33,918
BioCryst 12 7, 5 4 3 Discounted cash flow Discount rate 12.6% 130,757 124,444
BMS 49,064 Discounted cash flow Discount rate 9.5% 49,405 48,730
Collegium 278,578 Discounted cash flow Discount rate 10.0% 286,346 2 71,143
Evolus 61,722 Discounted cash flow Discount rate 14.5% 62,925 60,556
Geron 48,782 Discounted cash flow Discount rate 11.3% 50,517 47,129
Insmed 215,917 Discounted cash flow Discount rate 11.0% 222,396 209,706
Novocure 47,809 Discounted cash flow Discount rate 12.8% 4 9 ,11 0 46,559
OptiNose US 70,358 Discounted cash flow Discount rate 15.4% 71,266 69,471
Tarsus 36,661 Discounted cash flow Discount rate 12.4% 3 7, 814 35,559
UroGen 49,600 Discounted cash flow Discount rate 13 .1 % 50,351 48,867
Other net assets of BPCR
Limited Partnership
141,447 Amortised cost – – 141,447 141,447
1,162,200 1,187,881 1,137,529
1
The Company holds an investment in BPCR Limited Partnership, its wholly owned subsidiary, which it measures at fair value through profit or loss rather thanconsolidate.
² For those interest-bearing loans with variable rates, the discount rates and fair value sensitivities are calculated based on the variable rates extant at 31 December 2024.
8. TRADE AND OTHER RECEIVABLES
As at
31December 2025
$000
As at
31December 2024
$000
Unlisted income receivable from BPCR Limited Partnership 52,367 31,684
Interest income receiveable from listed investments 1,049 –
Interest accrued on liquidity/money market funds 40 30
Other debtors 14 4 83
53,600 31,797
There have been no write-offs in the year and any expected credit losses are notmaterial.
Notes to the Financial Statements continued
FINANCIAL STATEMENTS
86
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
9. CASH AND CASH EQUIVALENTS
As at
31December 2025
$000
As at
31December 2024
$000
Cash at bank 428 154
Liquidity/money market funds 12,159 5,466
12,587 5,620
Any expected credit losses are not material. This does not include the $409.7 million (31 December 2024: $163.0 million) of cash held at
the BPCR Limited Partnership. The total cash held by the Company and its financing subsidiary, BPCR Limited Partnership, is $422.3 million
(31December 2024: $168.6 million), as disclosed on page 4.
10. TRADE AND OTHER PAYABLES
Current liabilities
As at
31December 2025
$000
As at
31December 2024
$000
Performance fee payable 14,431 13,574
Management fees accrual
2,831
2 ,916
Repurchase of shares – 946
Accruals 295 448
17,557 17,884
Non-current liabilities
Deferred income – 55
17,557 17,939
11. RETURN PER ORDINARY SHARE
Revenue return per ordinary share is based on the net revenue after taxation of $112.3 million (2024: $122.3 million) and 1,139,617,210
(2024: 1,222,360,376) Ordinary shares, being the weighted average number of Ordinary shares for theyear.
Capital return per ordinary share is based on net capital gain for the year of $17.6 million (2024: net capital loss of $92,000) and on
1,139,617,210 (2024:1,222,360,376) Ordinary shares, being the weighted average number of Ordinary shares for theyear.
Basic and diluted return per share are the same as there are no arrangements which could have a dilutive effect on the Company’s ordinaryshares.
12. NET ASSET VALUE PER ORDINARY SHARE
The basic total net assets per ordinary share is based on the net assets attributable to equity shareholders at 31December 2025 of $1,150.9million
(31December 2024: $1,181.7 million) and Ordinary shares of 1,129,227,778 (31 December 2024: 1,186,056,657), being the number of
Ordinary shares outstanding at 31December2025.
There is no dilution effect and therefore there is no difference between the diluted total net assets per ordinary share and the basic total net assets
per ordinaryshare.
Notes to the Financial Statements continued
FINANCIAL STATEMENTS
87
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
13. SHARE CAPITAL
Year ended 31December 2025 Year ended 31December 2024
Number of shares $000 Number of shares $000
Issued and fully paid:
Ordinary shares of $0.01:
Balance at beginning of the year 1,373,932,067 13 , 73 9 1,373,932,067 13 , 73 9
Balance at end of the year 1,373,932,067 13,739 1,373,932,067 13,739
Total voting rights at 31December 2025 were 1,129,227,778 (31December 2024: 1,186,056,657). In 2025 56,828,879 shares were
bought back for treasury (2024: 116,622,535). The balance of treasury shares on 31December 2025 was 244,704,289 (31December
2024:187,875,410).
14. SUBSIDIARY
The Company formed a wholly-owned subsidiary, BPCR Ongdapa Limited (“BPCR Ongdapa”), incorporated in Ireland on 5October 2017 for
the purpose of entering into a purchase, sale and assignment agreement with a wholly-owned subsidiary of Royalty Pharma for the purchase of a
50 per cent. interest in a stream of payments acquired by Royalty Pharma from Bristol-Myers Squibb (“BMS”). The registered address for BPCR
Ongdapa is BPCR Ongdapa Limited, 2nd Floor, Block 5, Irish Life Center, Abbey Street Lower Dublin 1,Ireland.
The Company formed a wholly-owned subsidiary, BPCR Limited Partnership, incorporated in England and Wales on 27 March 2020 for
the purpose of entering into a three-year $200million revolving credit facility with JPMorgan Chase Bank. On 11 April 2024, the Company
terminated its JPMorgan revolving credit facility. BPCR Limited Partnership has its registered office at 19th Floor, 51 Lime Street, London, EC3M
7DQ and received an initial contribution of £1.00 at formation from the Company, its sole Limited Partner. In accordance with IFRS 10, the
Company is exempted from consolidating a controlled investee as it is an investment entity. Therefore, the Company’s investment in BPCR Limited
Partnership will be recognised at fair value through profit orloss.
The General Partner for BPCR Limited Partnership is BPCR GP Limited, incorporated in England and Wales on 11March 2020 and is wholly-
owned by the Company. The Company is not exempt from consolidating the financial statements of BPCR GP under IFRS 10, however the highly
immaterial (nil) balance of BPCR GP would produce accounts with almost identical balances to the Company. Furthermore with reference to the
Companies Act, section 405 (2) “A subsidiary undertaking may be excluded from consolidation if its inclusion is not material for the purpose of
giving a true and fair view”. The registered address for BPCR GP Limited is BPCR GP Limited, 19th Floor, 51 Lime Street, London, EC3M 7DQ.
The aggregate amount of its capital reserves as at 31December 2025 is $1,000 (2024: $nil) and a return for the year to 31December 2025
is $nil (2024:$nil).
As part of the successful closing of LumiraDx’s administration, the Company received its 41 per cent. share ownership of LumiraDx Colombia
Holdings Ltd (“UK Holdco”) on 6 February 2025, which the Company is actively seeking to sell. The registered address for UK Holdco is
19thFloor, 51 Lime Street, London United Kingdom EC3M 7DQ. The equity is a level 3 investment and valued using the comparable company
analysis. The outstanding fair value as at 31 December 2025 was $7.5 million.
Notes to the Financial Statements continued
FINANCIAL STATEMENTS
88
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
15. RECONCILIATION OF TOTAL RETURN FOR THE YEAR BEFORE TAXATION TO CASH GENERATED FROM
OPERATING ACTIVITIES
Year ended
31December 2025
$000
Year ended 31December
2024
$000
Total return for the year before taxation 129,887 12 2 ,178
Capital (gains)/losses (17,553) 92
Increase in trade receivables (21,803) (11,480)
Increase in trade payables 564 1,12 2
Cash generated from operating activities 91,095 111,912
16. FINANCIAL INSTRUMENTS
The Company’s financial instruments include its investment portfolio, cash balances, trade receivables and trade payables that arise directly from
its operations. Adherence to the Company’s investment policy is key in managing risk. Refer to the Strategic Overview on pages 26 to 39 for a full
description of the Company’s investment objective andpolicy.
The Investment Manager monitors the financial risks affecting the Company on an ongoing basis and the Directors regularly receive financial
information which is used to identify and monitor risk. All risks are actively reviewed and monitored by the Board. Details of the Company’s
principal risks can be found in the Strategic Report on pages 32 to38.
The main risks arising from the Company’s financial instruments are:
i) market risk, including price risk, currency risk and interest rate risk;
ii) liquidity risk; and
iii) creditrisk.
(I) MARKET RISK
Market risk is the risk of loss arising from movements in observable market variables. The fair value of future cash flows of a financial instrument held
by the Company may fluctuate because of changes in marketprices.
The Investment Manager assesses the exposure to market risk when making each investment decision and these risks are monitored by the
Investment Manager on a regular basis and the Board at quarterly meetings with the InvestmentManager.
Notes to the Financial Statements continued
FINANCIAL STATEMENTS
89
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
16. FINANCIAL INSTRUMENTS (CONTINUED)
MARKET PRICE RISK
The Company is exposed to price risk arising from its investments whose future prices are uncertain. The Company’s exposure to price risk
comprises movements in the value of the Company’s investments. See Note 7 above for investments that fall into Level 3 of the fair value hierarchy
and refer to the description of valuation policies in Note 2(d). The nature of the Company’s investments, with a high proportion of the portfolio
invested in unlisted debt instruments, means that the investments are valued by the Company after consideration of the most recent available
information from the underlying investments. The Company’s portfolio is diversified among counterparties and by the sectors in which the underlying
companies operate, minimising the impact of any negative industry-specifictrends.
The table below analyses the effect of a 10 per cent. change in the fair value of investments. The Investment Manager believes 10 per cent. is the
appropriate threshold for determining whether a material change in market value hasoccurred.
As at 31December 2025 At 31December 2024
Fair value
$000
10 per cent.
Increase/ decrease
in market value
$000
Fair value
$000
10 per cent.
Increase/ decrease
in market value
$000
Harrow senior unsecured notes 36,531 3,653 – –
CytoKinetics senior unsecured convertible notes 35,859
3,586 –
–
Cogent senior unsecured convertible notes 1,468 14 7 – –
OptiNose US warrants – – 64 6
Assets held by BPCR Limited Partnership
Other assets of BPCR Limited Partnership 359,234 35,924 132,726 13 , 2 73
Insmed 2024 senior secured loan 217,295 21, 73 0 215,917 21,592
Novocure senior secured loan 98,333 9,833 47,809 4 , 781
Evolus 2025 senior secured loan 62,074 6,207 61,722 6 ,172
UroGen senior secured loan 49,804 4,980 49,600 4,960
Geron senior secured loan 48,985 4,899 48,782 4,878
Precigen senior secured loan 48,854 4,885 – –
Tarsus senior secured loan 36,821 3,682 36,661 3,666
Alphatec senior secured loan 35 ,15 8 3, 516 34 , 719 3,472
Valneva senior secured loan 29,439 2,944 – –
Paratek senior secured loan 24,794 2,479 – –
BMS Purchased Payments (BPCR Ongdapa) 10,083 1,008 49,064 4,906
LumiraDx Columbia equity 7,500 750 7,500 750
Collegium 2024 senior secured loan – – 278,578 27,858
BioCryst senior secured loan – – 12 7, 5 4 3 12 , 75 4
OptiNose US Note – – 70,358 7,036
OptiNose US Equity – – 1,15 7 116
1,102,232 110,223 1,162,200 116,220
The Board manages the risks inherent in the investment portfolio by ensuring full and timely reporting of relevant information from the Investment
Manager. Investment performance and exposure are reviewed at each Boardmeeting.
Notes to the Financial Statements continued
FINANCIAL STATEMENTS
90
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
16. FINANCIAL INSTRUMENTS (CONTINUED)
CURRENCY RISK
Currency risk is the risk that fair values of future cash flows of a financial instrument fluctuate because of changes in foreign exchangerates.
At 31December 2025, the Company held cash balances in GBP Sterling of £316,000 ($425,000) (2024: £120,000 ($150,000)) and in Euro
of €3,000 ($4,000) (2024: €3,000($4,000)).
The currency exposures (including non-financial assets) of the Company as at 31December 2025:
Cash
$000
Investments
$000
Other net assets
$000
Total
$000
Sterling 425 – 29 454
Euro 4 – – 4
US Dollar 12,158 1,102,232 36,014 1,150,404
12,587 1,102,232 36,043 1,150,862
The currency exposures (including non-financial assets) of the Company as at 31December 2024:
Cash
$000
Investments
$000
Other net
(liabilities) /assets
$000
Total
$000
Sterling 15 0 – (18) 13 2
Euro 4 – – 4
US Dollar 5,466 1,162,200 13 , 876 1,181,542
5,620 1,162,200 13,858 1,181,678
A 10 per cent. increase in the Sterling exchange rate would have increased net assets by $36,000 (2024:$5,000).
A 10 per cent. increase in the Euro exchange rate would have increased net assets by $nil (2024:$nil).
A 10 per cent. decrease would have decreased net assets by the same amount (2024:same).
Notes to the Financial Statements continued
FINANCIAL STATEMENTS
91
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
16. FINANCIAL INSTRUMENTS (CONTINUED)
INTEREST RATE RISK
Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market interest rates.
Interest rate movements may potentially affect future cash flows from:
• investments in floating rate securities, unquoted loans and purchased payments; and
• the level of income receivable on cash deposits and liquidityfunds.
The Insmed 2024 and the Valneva senior secured loans, the Cogent and the CytoKinetics senior unsecured convertible notes and the Harrow
senior unsecured notes have a fixed interest rate and therefore are not subject to interest rate risk. Additionally, neither BMS purchased payments
nor LumiraDx Colombia has a defined fixed or floating rate of interest. The below table shows the percentage of the Company’s net assets
theyrepresent.
As at 31December 2025
% of Company Net Assets
As at 31December 2024
% of Company Net Assets
Insmed 2024 senior secured loan 19.00 18.51
Harrow senior unsecured notes 3.17 –
CytoKinetics convertible loan notes 3 .12 –
Valneva senior secured loan
2.61
–
BMS Purchased Payments (BPCR Ongdapa) 0.86 4.07
LumiraDx Colombia equity 0.65 0.63
Cogent senior unsecured convertible notes 0 .13 –
The Alphatec, Evolus, Geron, Novocure, Paratek, Precigen, Tarsus and Urogen loans and cash and cash equivalents, including investments in
liquidity funds, have a floating rate of interest. The below table shows the percentage of the Company’s net assets theyrepresent.
As at 31December 2025
% of Company Net Assets
As at 31December 2024
% of Company Net Assets
Novocure senior secured loan 8.69 4.23
Evolus 2025 senior secured loan 5.43 5.29
UroGen 2024 senior secured loan 4.35 4.23
Geron senior secured loan 4.35 4.23
Precigen senior secured loan 4.35 –
Tarsus senior secured loan 3.26 3 .17
Alphatec senior secured loan 3.04 2.96
Paratek senior secured loan 2.17 –
Collegium 2024 senior secured loan – 23.96
BioCryst senior secured loan – 10.96
OptiNose US senior secured loan – 6.05
Cash and cash equivalents
1
1.09 0.48
¹ Cash and cash equivalents represents the Company only and does not include cash held by BPCR LimitedPartnership. Of the 10 senior secured
loans, eight include floating coupons with SOFR floors. The SOFR floors range from 2 per cent. to 4 per cent., with a weighted average of
3.2 per cent.
A 100 basis point increase in SOFR would have increased net assets by $3.8million (2024:$28.1million).
A 100 basis point decrease in SOFR would have decreased net assets by $9.4million (2024:$21.4million).
A 300 basis point increase in SOFR would have increased net assets by $32.4million (2024:$82.5million).
Notes to the Financial Statements continued
FINANCIAL STATEMENTS
92
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
16. FINANCIAL INSTRUMENTS (CONTINUED)
(II) LIQUIDITY RISK
This is the risk that the Company will encounter difficulty in meeting obligations associated with financialliabilities.
At 31December 2025, the Company had cash and cash equivalents of $12.6 million (2024: $5.6 million), including investments in liquidity/
money market funds with balances of $12.2 million (2024: $5.5 million) and maximum unfunded commitments of $nil (2024: $nil). These assets
can be sold easily to meet funding commitments ifnecessary.
At 31December 2025, BPCR Limited Partnership had cash and cash equivalents of $409.7million (2024: $163million), including investments
in liquidity/money market funds with balances of $408.8million (2024: $163million) and maximum unfunded commitments of $366.7million
(2024:$262.5million).
The Company maintains sufficient liquid investments through its cash and cash equivalents to pay accounts payable, accrued expenses and
ongoing expenses of the Company and to fulfill obligations due or anticipated within one year after the financial statements are issued. Liquidity
risk is manageable through a number of options, including the Company’s ability to issue debt and/ or equity and by selling all or a portion of an
investment in the secondary market.
The Company’s liabilities as at 31December 2025 were $17.6million (2024: $17.9million) of which $17.6million (2024: $17.9million) was
repayable within one year. There is sufficient cash and cash equivalents to repay the liabilities when they becomedue.
(III) CREDIT RISK
This is the risk the Company’s trade and other receivables will not meet their obligations to theCompany.
While the Company will often seek to be a secured lender for each debt asset, there is no guarantee that the relevant borrower will repay the
loan or that the collateral will be sufficient to satisfy the amount owed. All of the Company’s investments are senior secured investments as detailed
in the Investment Manager’s Report on pages 6 to17.
The Investment Manager performs a robust credit risk analysis during the investment process for all new investments and constantly monitors the
collateral on its outstanding senior secured loans as to minimise the credit risk to the Company of default. The credit risk of the senior secured loans
will increase significantly after initial recognition when borrowers are not making principal and interest payments as agreed. The fair value of the
senior secured loan will be adjusted, either partially or in full, when there is no realistic prospect of recovery and the amount of the change in fair
value has been determined by the Investment Manager. Subsequent recoveries of amounts previously adjusted will decrease the amount of the
fair value loss recorded. Changes to a counterparty’s risk profile are monitored by the Investment Manager on a regular basis and discussed with
the Board at quarterlymeetings.
The Company’s maximum exposure to credit risk at any given time is the fair value of its investment portfolio and cash and receivables. At
31 December 2025, the Company’s maximum exposure to credit risk was $1,168.4 million (2024: $1,199.6 million). The Company’s
concentration of credit risk by counterparty can be found in the Investment Manager’s Report on pages6 to 17.
CAPITAL MANAGEMENT
The Company’s primary objectives in relation to the management of capital are:
• to ensure its ability to continue as a going concern;
• to ensure that the Company conducts its affairs to enable it to continue to meet the criteria to qualify as an investment trust; and
• to maximise the long-term shareholder returns in the form of sustainable income distributions through an appropriate balance of equity capital
anddebt.
This is to be achieved through an appropriate balance of equity capital and gearing. The Company operates a flexible gearing policy which
depends on prevailing conditions. The Company may incur indebtedness up to 25 per cent. of the Company’s net asset value with a maximum of
up to 50 per cent. with Boardapproval.
Notes to the Financial Statements continued
FINANCIAL STATEMENTS
93
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
17. RELATED PARTY TRANSACTIONS
1
The amount incurred in respect of management fees during the year to 31 December 2025 was $11.3million (31December 2024: $12.0million),
of which $2.8million (31 December 2024: $2.9million) was outstanding at 31December 2025. The amount due to the Investment Manager
for performance fees at 31December 2025 was $14.4million (31December 2024: $13.6million). Please refer to Note 4(b) for further details.
The Investment Manager and its affiliates own approximately 2 per cent. of the Company as at 31 December 2025.
The amount incurred in respect of Directors’ fees during the year to 31December 2025 was $579,000 (31December 2024: $551,400) of
which $nil was outstanding at 31 December 2025 (31 December 2024: $nil). Please refer to Note 4(c) for further details.
BPCR Limited Partnership and its General Partner, BPCR GP Limited, are related entities of the Company, as they are wholly-owned subsidiaries
and were formed for the purpose of entering into a new credit facility. On 22 May 2020, several investments totaling $1,070.1million were
transferred to BPCR Limited Partnership from the Company. In the year to 31 December 2025, the Company recorded income from BPCR Limited
Partnership of $138.5million (31 December 2024: $148.5million) and the outstanding balance on 31 December 2025 was $52.4million
(31December 2024: $31.7million). BPCR GP Limited had an outstanding balance as at 31 December 2025 of $nil (31 December 2024: $nil).
On 6October 2025, the Company and the Private Fund entered into a senior secured term loan agreement with Valneva Austria GmbH, a
subsidiary of Valneva SE. The Company (through BPCR Limited Partnership) will invest up to $30.0million and the Private Fund will invest up to
$185.0million in parallel, with the Company acting as collateral agent. The loan will mature in October 2030 and will bear interest at a fixed
rate of 9 per cent. per annum. The Company funded its share of Tranche A of $30.0million on 17 October 2025 and received a 2 per cent.
additional consideration at funding. In the year to 31 December 2025, BPCR Limited Partnership recorded interest of $570,000 (31December
2024: $nil). The outstanding balance as at 31December 2025 was $30.0million. (31 December 2024: $nil).
On 3 September 2025, the Company and the Private Fund entered into a senior secured term loan agreement with Precigen, Inc. The Company
(through BPCR Limited Partnership) will invest up to $62.5million and the Private Fund will invest up to $62.5million in parallel, with the Company
acting as collateral agent. The loan will mature in September 2030 and will bear interest at 3-month SOFR plus 6.50 per cent. (subject to a
3.75per cent. floor). The Company funded its share of Tranche A of $50.0million and received a 2.50 per cent. additional consideration at
closing. Tranche B is available to be drawn until 29June 2027 and after achieving certain sales milestones. The additional consideration for the
remaining tranche will be payable on the respective funding date. In the year to 31December 2025, BPCR Limited Partnership recorded interest
of $1.8million (31December 2024: $nil). The outstanding balance as at 31December 2025 was $50.0million. (31 December 2024: $nil).
On 21 May 2025, the Company and the Private Fund entered into a senior secured term loan agreement with Paratek Pharmaceuticals, Inc.
alongside funds managed by Oaktree Capital Management, L.P. and Q Aspen LLC (a wholly owned subsidiary of Qatar Investment Authority).
The Company (through BPCR Limited Partnership) will invest up to $25.0million and the Private Fund will invest up to $25.0million in parallel,
with the Company acting as collateral agent out of a total $250.0million senior secured loan facility. Oaktree and QIA funded the remaining
balance of the $200.0million senior secured loan facility. The Company funded its share of the tranche at closing. Since Paratek is a privately held
company, further details about the senior secured loan facility are not publicly available, but the terms of the loan are generally comparable with
the Company’s other investments. The outstanding balance as at 31 December 2025 was $25.0 million. (31 December 2024: $nil).
On 1 November 2024, the Company and the Private Fund entered into a senior secured term loan agreement with Geron Corporation. The
Company (through BPCR Limited Partnership) will invest up to $100.0million and the Private Fund will invest up to $150.0million in parallel, with
the Company acting as collateral agent. The loan will mature in November 2029 and will bear interest at 3-month SOFR plus 5.75percent.
(subject to a 3 per cent. floor). The Company funded its share of Tranche A of $50.0million and received a 2.50 per cent. additional consideration
at closing. Tranche B and Tranche C were originally due to expire on 31 December 2025. On 6 January 2026, the Company and Geron
entered into an amendment to extend the availability period for Tranche B and Tranche C to 30 September 2026 and extend the make-whole
date for Tranche A to 1 May 2027. In the year to 31 December 2025, BPCR Limited Partnership recorded interest of $5.1million (31 December
2024:$874,000). The outstanding balance as at 31 December 2025 was $50.0million. (31 December 2024: $50.0million).
On 29 October 2024, the Company and the Private Fund entered into a new investment in the form of an assignment of $70.0million in a
$200.0million senior secured term loan agreement with Alphatec Holdings, Inc. The Company (through BPCR Limited Partnership) invested
$35.0million and the Private Fund invested $35.0million in parallel, with the Company acting as collateral agent. The loan will mature in January
2028 and will bear interest at 3-month SOFR plus 5.75 per cent. (subject to a 3 per cent. floor) and a 1 per cent. additional consideration was
paid at funding.
1
Past performance is not an indication of future performance.
Notes to the Financial Statements continued
FINANCIAL STATEMENTS
94
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
17. RELATED PARTY TRANSACTIONS1
1
(CONTINUED)
The assignor, Braidwell Transaction Holdings LLC - Series I, will retain the remaining $130.0million. The loan includes a prepayment premium of
3 per cent. of the principal amount of any such repayment during the first 12 months after the signing date, 2 per cent. of the principal amount of
any such repayment during months 13 through 24 after the signing date, and 1 per cent. of the principal amount of any such repayment thereafter
but prior to the maturity date, as well as an exit consideration of 3.25 per cent. of the principal amount of any repayment or prepayment on such
date of repayment or prepayment. On 5 March 2025, the Company purchased $15million of 0.75 per cent. senior unsecured convertible notes
due 2030 issued by Alphatec Holdings, Inc. at a purchase price of $100 per note for a $15.0million investment. On 9 September 2025 and
31October 2025, the Company sold 8million and 7million respectively, of 0.75 per cent. Alphatec Holdings, Inc. convertible senior notes due
2030, at an average price of $134. The sales generated a gain of $5.0million. In the year to 31 December 2025, BPCR Limited Partnership
recorded interest of $3.6million (31December 2024: $658,000). The outstanding balance as at 31 December 2025 was $35.0million.
(31December 2024: $35.0million).
On 1 May 2024, the Company and the Private Fund, entered into a senior secured term loan agreement with a wholly-owned subsidiary
of Novocure Limited. The Company (through BPCR Limited Partnership) will invest up to $200.0million and the Private Fund will invest up to
$200.0million in parallel, with the Company acting as collateral agent. The loan will mature in May 2029 and will bear interest at 3-month SOFR
plus 6.25 per cent. (subject to a 3.25 per cent. floor). Tranche A of $50.0million was drawn on 1 May 2024. Tranche B of $50.0million was
drawn on 26 September 2025. The remaining $100.0million is available to be drawn after achieving certain sales-based milestones. In the year
to 31 December 2025, BPCR Limited Partnership recorded interest of $6.7million (31 December 2024: $3.8million). The outstanding balance
as at 31 December 2025 was $100.0million. (31 December 2024: $50.0million).
On 19 April 2024, the Company and the Private Fund entered into a senior secured term loan agreement with Tarsus Pharmaceuticals, Inc. The
Company (through BPCR Limited Partnership) will invest up to $100.0million and the Private Fund will invest up to $100.0million in parallel,
with the Company acting as collateral agent. The Company invested $37.5million at the Tranche A closing. The remaining tranches totaling
$75.0million, expired without being drawn. The loan will mature in April 2029 and has a coupon of 3-month SOFR plus 6.75 per cent. (subject
to a 3.75 per cent. floor). In the year to 31 December 2025, BPCR Limited Partnership recorded interest of $4.2million (31 December 2024:
$3.2million). The outstanding balance as at 31 December 2025 was $37.5million. (31 December 2024: $37.5million).
On 5 May 2023, the Company and the Private Fund entered into a senior secured term loan agreement with Reata Pharmaceuticals, Inc. Under
the terms of the transaction, the Company (through BPCR Limited Partnership) was originally due to invest up to $137.5million and the Private
Fund was originally due to invest up to an additional $137.5million in parallel, with the Company acting as collateral agent. The loan was
originally due to mature in May 2028 and bore interest at 3-month SOFR plus 7.50 per cent. per annum subject to a 2.50 per cent. floor along
with a one-time additional consideration of 2 per cent. of the loan amount payable upon funding. Tranche A of $37.5million was funded at
closing and tranche B of $25.0million was funded on 10 July 2023. On 28 July 2023, Biogen, Inc. (“Biogen”) Biogen announced a proposed
acquisition of Reata for an enterprise value of approximately $7.3 billion. The acquisition closed on 29 September 2023. As of the acquisition
closing date, the Company received prepayments including $15.5million in prepayment and make-whole fees. In April 2024, the Company and
the Private Fund filed a lawsuit in New York courts against Biogen and Reata with respect to a dispute about fees payable under the terms of the
loan agreement. In April 2025, the parties entered into a settlement agreement, representing the final resolution of this dispute. After approximately
$1.3million in legal and other related expenses payable by the Company, the Company received an additional net $7.3million in revenue from
this settlement payment. In the year to 31 December 2025, BPCR Limited Partnership recorded interest of $8.3million (31 December 2024: $nil).
The outstanding balance as at 31 December 2025 was $nil. (31 December 2024: $nil).
On 17April 2023, the Company and the Private Fund entered into a senior secured term loan agreement with BioCryst Pharmaceuticals, Inc.
Under the terms of the transaction, the Company (through BPCR Limited Partnership) invested $180.0million and the Private Fund invested an
additional $270.0million in parallel, with the Company acting as collateral agent. The commitment for the remaining three tranches of up to
$50.0million each expired on 30 September 2024. The loan was due to mature in April 2028 and bore interest at 3-month SOFR plus 7 per
cent. per annum subject to a 1.75 per cent. floor and up to 50 per cent. of the interest during the first 18 months were paid-in-kind (PIK) at a rate
of 3-month SOFR plus 7.25 per cent. On 16 April 2023, the Company funded $120.0million through its subsidiary and BioCryst elected to PIK
interest of $9.5million. On 18 April 2025, BioCryst prepaid $30million of its balance to the Company and the Company received $1.1million
in accrued interest and prepayment fees. On 24 July 2025, BioCryst prepaid $20.0million of its balance to the Company and the Company
received $751,000 in accrued interest and prepayment fees. On 8October 2025, BioCryst repaid its remaining $79.5million balance to the
Company and the Company received $2.6million in accrued interest and prepayment fees. In the year to 31 December 2025, BPCR Limited
Partnership recorded interest of $9.3million (31December 2024: $3.2million). The outstanding balance as at 31 December 2025 was $nil
(31December 2024: $129.5million).
1
Past performance is not an indication of future performance.
Notes to the Financial Statements continued
FINANCIAL STATEMENTS
95
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
17. RELATED PARTY TRANSACTIONS
1
(CONTINUED)
On 19 October 2022, the Company and the Private Fund entered into a senior secured term loan agreement with Insmed, Inc. The Company
(through BPCR Limited Partnership) invested $140.0million on 19 October 2022. The loan was due to mature in October 2027, bore interest
at 3-month SOFR plus 7.75 per cent. per annum subject to a 2.50 per cent. floor along with a one-time additional consideration of 2 per cent.
of the loan amount payable upon funding and up to 50 per cent. of the interest during the first 24 months may PIK. On 31 October 2024, the
Company and the Private Fund entered into an amended and restated senior term loan agreement for up to $547.0million with Insmed. The
new loan consists of a $397.0million initial term loan to refinance in full the existing term loan and a new $150.0million tranche. The Company
(through BPCR Limited Partnership) funded its share of the new tranche of $60.0million at signing. The loan will mature in September 2029 and
will bear interest at a fixed rate of 9.60 per cent. per annum and a 2 per cent. exit consideration. In the year to 31 December 2025, BPCR Limited
Partnership recorded interest of $21.3million (31 December 2024: $20.5million). The outstanding balance as at 31 December 2025 was
$218.7million (31 December 2024: $218.7million).
On 7March 2022, the Company and the Private Fund entered into a senior secured term loan agreement with UroGen Pharma, Inc. Under the
terms of the transaction, the Company (through BPCR Limited Partnership) will invest up to $50.0million. The loan was due to mature in March
2027 and bore interest at 3-month LIBOR plus 8.25per cent. per annum subject to a 1.25per cent. floor along with a one-time additional
consideration of 1.75per cent. of the total loan amount payable upon funding of the first tranche. The Company funded $37.5 million on
16March 2022 and $12.5million on 16December 2022. On 29June 2023, the UroGen loan was amended to transition from 3-month
LIBOR to 3-month SOFR and an additional per annum rate of 0.26161per cent. On 13March 2024, the Company and the Private Fund
entered into the amended and restated loan agreement for up to $200.0million with UroGen. The new loan consists of a $50.0million initial
term loan to refinance in full the existing term loan and additional tranches of up to $100.0million allocated in full to the Private Fund. The loan
will mature in March 2028 and will bear interest at 3-month SOFR plus 7.25per cent. per annum subject to a 2.50per cent. floor. In the year to
31December 2025, BPCR Limited Partnership recorded interest of $5.9million (31December 2024: $6.5million). The outstanding balance as
at 31December 2025 was $50.0million (31December 2024: $50.0million).
On 14December 2021, the Company and the Private Fund entered into a senior secured term loan agreement with Evolus Inc. The Company’s
share of the transaction was up to $62.5million and the Company funded (through BPCR Limited Partnership) the first tranche of $37.5million on
29December 2021 and a one-time additional consideration of 2.25per cent. of the total loan amount was paid at funding. On 5May 2023, the
Evolus loan was amended to allow Evolus to draw Tranche B in two installments, to allow the principal payments to be equal quarterly payments
beginning in 2026 and transition from 3-month LIBOR to 3-month SOFR and an additional per annum rate of 0.17per cent. The Company
funded $12.5million on both 31May 2023 and 15December 2023 for a total of $25.0million for the second tranche. The loan was due to
mature in December 2027 and bore interest at 3-month LIBOR plus 8.50per cent. per annum subject to a 1per cent. floor. On 5May 2025, the
Company and the Private Fund provided Evolus with a commitment to enter into a new senior secured term loan agreement for $250.0million.
The new loan consists of a $150.0million initial term loan to refinance in full the existing term loan and an additional $25.0million that was
allocated in full to the Private Fund at signing. Tranche B and Tranche C are available to be drawn until 31December 2026. The new allocation
for the loan is 41.7per cent. to the Company and 58.3per cent. to the Private Fund. The loan will mature in May 2030 and will bear interest at
3-month SOFR plus 5per cent. per annum subject to a 3.50per cent. floor and a 2per cent. exit consideration. In 31December 2025, BPCR
Limited Partnership recorded interest of $6.6million (31December 2024: $8.8million). The outstanding balance as at 31December 2025 was
$62.5million (31December 2024: $62.5million).
1
Past performance is not an indication of future performance.
Notes to the Financial Statements continued
FINANCIAL STATEMENTS
96
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
17. RELATED PARTY TRANSACTIONS
1
(CONTINUED)
On 23 March 2021, the Company and the Private Fund entered into a senior secured loan agreement with LumiraDx for $300.0million. The
loan would have matured in March 2024, bore interest at 3-month SOFR plus 8 per cent. with the ability to PIK anything above 8 per cent., and
an additional consideration of 2.50 per cent. of the total loan amount and 9 per cent. of the total loan amount payable upon repayment. The
Private Fund’s allocation of the transaction was $150.0million. From 24 July 2023 to 9 November 2023, the Company and the Private Fund
funded $53.0million of additional tranches to LumiraDx. On 29 December 2023, LumiraDx announced the appointment of joint administrators
for two of its subsidiaries and Roche Diagnostics Limited (“Roche”) announced that it would acquire select parts of LumiraDx for a purchase price
of $295.0million. On 29 July 2024, FTI Consulting LLP, as the UK administrator for LumiraDx, made an initial payment to the Company and
the Private Fund of $330.6million of which $165.3million was received by the Company. On 31 October 2024 and 20 December 2024,
FTI Consulting LLP, as the UK administrator for LumiraDx, returned $18.5million and $2.9million, respectively, to the Company and the Private
Fund, which included the agreed holdback amount under the Roche Sales and Purchase Agreement. Additionally, the Company received its
41 per cent. share ownership of LumiraDx’s Colombian subsidiary, which it is actively seeking to sell. In the year to 31 December 2025, BPCR
Limited Partnership recorded interest of $409,000 (31 December 2024: $645,000). The outstanding balance as at 31 December 2025 was
$7.5million (31December 2024: $ nil).
On 6 February 2020, the Company and the Private Fund entered into a senior secured term loan agreement for $200.0million with Collegium
Pharmaceutical, Inc. The Company’s share of the transaction was $165.0million and the Company funded the term loan on 13 February 2020.
The 2020 loan was originally due to mature in February 2024 and bore interest at 3-month LIBOR plus 7.5 per cent. per annum subject to a
2per cent. floor along with a one-time additional consideration of 2.50 per cent. of the loan amount which was paid at funding. On 14 February
2022, the Company and the Private Fund provided Collegium Pharmaceutical, Inc. with a commitment to enter into a new senior secured term
loan agreement for $650.0million. Proceeds from the new loan were used to fund Collegium’s acquisition of BioDelivery Sciences International,
Inc. (“BDSI”) as well as repay the outstanding debt of Collegium and BDSI. Under the terms of the 2022 loan, the Company invested (through
BPCR Limited Partnership) $325.0million in a single drawing. The four-year loan for the Company’s investment had $50.0million in amortisation
payments during the first year and the remaining $275.0million balance was due to amortise in equal quarterly installments. The loan bore interest
at 3-month LIBOR plus 7.5 per cent. per annum subject to a 1.2 per cent. floor along with a one-time additional consideration of 2 per cent. of
the loan amount payable at signing and 1 per cent. of the loan amount payable at funding. On 23 June 2023, the Collegium loan was amended
to transition from 3-month LIBOR to 3-month SOFR and an additional per annum rate of 0.26161 per cent. On 28 July 2024, the Company
and the Private Fund provided Collegium with a commitment to enter into a new senior secured term loan agreement for $645.8million. The
new loan consisted of a $320.8million initial term loan, of which the Company’s share was $160.4million, to refinance in full the existing term
loan and a $325million second tranche, of which the Company’s share was $130.0million, that was drawn on 23 September 2024. Proceeds
from the new loan were used to assist Collegium in the successful closing of the acquisition of Ironshore Therapeutics. The loan was originally
due to mature in July 2029 and bore interest at 3-month SOFR plus 4.5 per cent. per annum subject to a 4 per cent. floor along with a one-time
additional consideration of 1.25 per cent. of the loan amount paid upon signing, a one-time additional consideration of 2.25 per cent. of the
loan amount paid at funding. On 23 December 2025, Collegium paid its remaining $261.4million balance to the Company and the Company
received $7.9million in accrued interest and prepayment fees. In the year to 31 December 2025, BPCR Limited Partnership recorded interest
of $23.9 million (31 December 2024: $26.4million). The outstanding balance as at 31 December 2025 was $nil (31 December 2024:
$283.2million).
1
Past performance is not an indication of future performance.
Notes to the Financial Statements continued
FINANCIAL STATEMENTS
97
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
17. RELATED PARTY TRANSACTIONS
1
(CONTINUED)
On 12 September 2019, the Company and the Private Fund entered into a senior secured note purchase agreement for the issuance and sale
of senior secured notes in an aggregate original principal amount of up to $150.0million by OptiNose US. OptiNose US is a wholly-owned
subsidiary of OptiNose, a commercial-stage specialty pharmaceutical company. OptiNose drew a total of $130.0million in three tranches:
$80.0million on 12 September 2019, $30.0million on 13 February 2020 and $20.0million on 1 December 2020. There were no further
funding commitments. The notes were due to mature in September 2024 and bore interest at 10.75 per cent. per annum along with a one-time
additional consideration of 0.75 per cent. of the aggregate original principal amount of senior secured notes which the Company and the Private
Fund were committed to purchase under the facility and 810,357 warrants exercisable into common stock of OptiNose. The Company funded
a total $71.5million across all tranches and was allocated 445,696 warrants. On 18 November 2021, OptiNose US raised $46.0million
in a follow-on offering at a price of $1.60. As part of the financing, the Company re-tiered its sales covenants, amended the amortization and
make-whole provisions, and issued new three-year warrants at the offering price of $1.60, with the original warrants having been canceled.
On 10August 2022, the OptiNose note and purchase agreement was amended resulting in re-tiered sales covenants in exchange for an
amendment fee of $780,000, payable upon repayment, of which the Company was allocated $429,000. On 9 November 2022, OptiNose
negotiated certain waivers in exchange for a waiver fee, of which the Company earned $715,000 of the total $1.3million waiver fee. On
21 November 2022, OptiNose entered into an amended and restated note purchase agreement. As part of the amended and restated note
purchase agreement, the Company and the Private Fund revised the sales covenants, amended the amortisation and make-whole, and modified
the loan interest rate to 3-month SOFR plus 8.5 per cent., subject to a 2.5 per cent. floor, in exchange for an amendment fee. From 5 March
2024 through 9 May 2024, the Company entered into three amendments with OptiNose US. The amendments collectively waived the no ‘going
concern’ requirement with respect to its financial statements until the end of the 2025 fiscal year, extended the make-whole period by 6 months
and revised the sales and minimum liquidity covenants. The waiver of the no ‘going concern’ requirement remains until the end of the 2025 fiscal
year and the revised minimum liquidity covenant was contingent on a successful equity raise. OptiNose announced on 9 May 2024 a successful
$55.0million registered direct offering. In connection with these amendments, OptiNose also issued 4.7million shares in the aggregate to the
Company and Private Fund in satisfaction of approximately $4.7million of outstanding amendment and waiver fees. On 21 May 2025, Paratek
announced its successful acquisition of OptiNose. In connection with the closing, OptiNose repaid its remaining $71.5million balance to the
Company and the Company received $11.3million in accrued interest and prepayment and make-whole fees. The Company also received
proceeds of $1.6million in connection with the Company's outstanding OptiNose shares. Under the terms of the acquisition, Paratek acquired
all outstanding shares of OptiNose US for approximately $330.0million including the assumption of debt and assuming full payment of the
contingent value rights (CVRs), and OptiNose shareholders were paid $9 per share in cash and received CVRs for up to $5 per share in cash
payable in the event that certain net revenue milestones are achieved. In the year to 31 December 2025, BPCR Limited Partnership recorded
interest of $3.6million (31 December 2024: $9.9million). The outstanding balance as at 31 December 2025 was $nil (31December 2024:
$71.5million). The Company no longer held warrants as at 31 December 2025. As at 31 December 2024, the Company held 1.4million
warrants valued at $64,000.
On 8 December 2017, the Company’s wholly-owned subsidiary BPCR Ongdapa entered into a purchase, sale and assignment agreement
with RPI Acquisitions (Ireland) Limited (“RPI Acquisitions”), an affiliate Pharma, for the purchase of a 50 per cent. interest in a stream of Purchased
Payments acquired by RPI Acquisitions from Bristol-Myers Squibb through a purchase agreement dated 14 November 2017. As a result of the
arrangements, RPI’s subsidiary and the Company’s subsidiary were each entitled to the benefit of 50 per cent. of the Purchased Payments under
identical economic terms. The Purchased Payments were linked to tiered worldwide sales of Onglyza and Farxiga, diabetes agents marketed by
AstraZeneca, and related products. The Company funded all of the Purchased Payments based on sales from 1 January 2018 to 31 December
2019 for a total of $162million. The final payment of $10.2million was received on 13 March 2026. Based on sales from 1 January 2020 to
31 December 2025, the Company received $243million consisting of $162.0 million of principal and $81.0million in interest.
A Shared Services Agreement was entered into by and between RP Management, LLC, an affiliate of the Investment Manager, and the Investment
Manager as of 1 January 2016. Under the terms of the Shared Services Agreement, the Investment Manager may have access to the expertise
of certain Royalty Pharma employees, including its research, legal and compliance, and finance teams.
The Private Fund and RPI Acquisitions are related entities of the Company due to a principal of the Investment Manager, Pablo Legoretta, having
influence over each of these entities.
1
Past performance is not an indication of future performance.
Notes to the Financial Statements continued
FINANCIAL STATEMENTS
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BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
18. CONTINGENCIES, GUARANTEES AND FINANCIAL COMMITMENTS
As at 31 December 2025, there were outstanding commitments in BPCR Limited Partnership of up to $229.2million (31 December 2024:
$250million) in respect of investments (see Note 17 for further details).
19. SUBSEQUENT EVENTS
On 6 January 2026, the Company and the Private Fund entered into an amendment with Geron to extend the availability period for TrancheB
and Tranche C to 30 September 2026 and extend the make-whole date for Tranche A to 1 May 2027.
On 10 February 2026, the Board approved an interim dividend in respect of the financial period ending 31 December 2025 of $0.03196044
per ordinary share, that was paid on 20 March 2026.
From 11 February 2026 through 18 February 2026, the Company sold 18 million of 1.75 per cent. CytoKinetics, Inc. senior unsecured convertible
notes due 2031 at an average price of $1.29. The sales generated a gain of $5.2 million.
On 26 February 2026, the Company and the Private Fund entered into an amended and restated senior term loan agreement with UroGen
for $250million. The existing $125 million initial term loan was increased to $200 million in a new Tranche A (with the additional $75 million
being funded at closing) and an additional Tranche B was added for up to $50 million that expires 30 June 2027. The Company’s share of the
transaction was $125 million. The loan will mature in February 2031 and will bear interest at a fixed rate of 8.25 per cent. per annum. and a
one-time additional consideration of 1.50 per cent. of each new tranche is payable upon funding of each respective tranche, with the Company
receiving $1.5 million in connection with the new Tranche A at signing. In addition, an exit consideration of 1 per cent. is also required upon any
payment of principal, scheduled or otherwise.
On 14 March 2026, the Company and the private fund entered into a new senior secured loan agreement with Zenas BioPharma, Inc. The
Company will invest up to $125 million, and the private fund will invest up to an additional $125 million in parallel, with the Company acting
as collateral agent. Under the Loan Agreement, the Company will invest up to $125 million across five tranches, subject to customary conditions
precedent (Tranche A of $37.5 million, Tranche B of $37.5 million, Tranche C of $12.5 million, Tranche D of $25 million and Tranche E of
$25million). The loan will mature in March 2031 and will bear interest at 3-month SOFR plus 5.75 per cent. per annum subject to a 3.25 per
cent. SOFR floor. A one-time additional consideration of 2 per cent. of Tranche A and $50 million of Tranche B, and 1 per cent. of any amounts
in excess of $50 million of the funding amount for Tranche B and each of Tranche C, D and E, is payable by Zenas upon the funding of each
respective tranche.
On 16 March 2026, Paratek announced the successful completion of its combination with Radius Health, and the Company and Private Fund
provided debt financing in support of this transaction. The Company and the Private Fund each funded $50 million and the new investment
replaced the previous debt financing in which the Company and Private Fund each had $25 million with Paratek, which was repaid in its entirety.
Since Paratek is a privately held company, further details about the new debt financing are not publicly available, but the terms of the loan are
generally comparable with the Company’s other investments.
ADDITIONAL INFORMATION
Measures (APM)
Glossary of Terms and Alternative Performance
99
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
APMs are employed to enhance the comparability of information across reporting periods. While APMs are not meant to replace International
Financial Reporting Standards (IFRS) measures, they provide valuable additional insights into the business’s performance.
DIVIDEND YIELD
The dividend yield is the total dividends declared for the calendar year divided by the share price at yearend.
GROSS IRR
Gross IRR as of such prepayment date means an aggregate, annual, compounded, as applicable, internal rate of return, calculated on the
basis of historical and projected capital inflows and outflows related to the particular investment, without taking into account the impact of
management fees, incentive compensation, taxes, or transaction and organizational costs and expenses. Past performance is not an indication of
future performance.
NET INCOME PER ORDINARY SHARE
Net income per ordinary share is the net revenue return for the year divided by the number of ordinary shares outstanding.
NET IRR
The net internal rate of return of a particular investment is calculated by applying a 20 per cent. reduction to the respective gross internal rate of
return of a particular investment, which is the average percentage reduction from the gross internal rate of return and net internal rate of return each
realized investment of BPCR since its inception through the most recently completed calendar year, and also reflecting that BPCR’s shareholders are
all subject to the same fees and incentive compensation payable by BPCR. The net internal rate of return for realized investments in the prior closed
prior funds means an aggregate, annual, compounded, as applicable, internal rate of return, calculated on the basis of realized capital inflows
and outflows for such investment, taking into account, the impact of its proportional share of fees and expenses actually paid by its relevant closed
private fund. The Investment Manager believes this methodology is the appropriate approach to derive an approximate realized net internal rate
of return for realized investments in the Company. Past performance is not an indication of future performance.
NAV PER ORDINARY SHARE
Net Asset Value (NAV) is the value of total assets less liabilities. The NAV per share is calculated by dividing this amount by the number of ordinary
shares outstanding.
PREMIUM (DISCOUNT) TO NAV PER ORDINARY SHARE
As stock markets and share prices vary, an investment trust’s share price is rarely the same as its NAV. When the share price is lower than the NAV
per share it is said to be trading at a discount. The size of the discount is calculated by subtracting the share price from the NAV per share and it is
usually expressed as a percentage of the NAV per share. If the share price is higher than the NAV per share, it is said to be trading at a premium.
RETURN PER ORDINARY SHARE
Revenue return per Ordinary share is based on the net revenue after taxation divided by the weighted average number of Ordinary Shares for
the year. Capital return per Ordinary Share is based on net capital gains divided by weighted average number of Ordinary Shares for the year.
Glossary of Terms and Alternative Performance Measures (APM) continued
100
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
ADDITIONAL INFORMATION
ONGOING CHARGES
Ongoing charges are the Company’s expenses expressed (excluding and including performance fee) as a percentage of its average monthly net
assets and follows the AIC recommended methodology.
Ongoing charges are different to total expenses as not all expenses are considered to be operational and recurring.
The calculation below is in line with AIC guidelines.
Year to
31 December 2025
Total expenses
(d) 27,897,000
Less: Performance fee
(14,431,000)
Total
(a) 13,466,000
Average monthly net assets
(b) 1,137,899,511
Ongoing charges excluding performance fee (c=a/b)
(c) 1.18 %
Ongoing charges including performance fee (e=d/b) (e)
2.45%
ADDITIONAL INFORMATION
Corporate Information
101
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
DIRECTORS
Harry Hyman (Chairman)
Colin Bond
Duncan Budge
Stephanie Léouzon
Nigel Reynolds (Appointment date: 1 January 2026)
Sapna Shah
Rolf Soderstrom
INVESTMENT MANAGER AND AIFM
Pharmakon Advisors, LP
110 East 59th Street #2800
New York, NY 10022
USA
ADMINISTRATOR
Waystone Administration Solutions (UK) Limited
Broadwalk House
Southernhay West
Exeter
EX1 1TS
COMPANY SECRETARY
MUFG Corporate Governance Limited
Central Square
29 Wellington Street
Leeds
LS1 4DL
COMPANY WEBSITE
www.bpcruk.com
CUSTODIAN
Bank of New York Mellon
One Canada Square
London
E14 5AL
FINANCIAL AND STRATEGIC COMMUNICATIONS
Burson Buchanan Limited
Rose Court
2 Southwark Bridge Road
London
SE1 9HS
INDEPENDENT AUDITOR
Ernst & Young, Chartered Accountants
Harcourt Centre
Harcourt Street
Dublin 2 Ireland
JOINT BROKERS
J.P. Morgan Cazenove
25 Bank Street
London
E14 5JP
Investec Bank plc
30 Gresham Street
London
EC2V 7QP
LEGAL ADVISER
Herbert Smith Freehills LLP
Exchange House
Primrose Street
London
EC2A 2EG
REGISTRAR
MUFG Corporate Markets Limited
Central Square
29 Wellington Street
Leeds
LS1 4DL
ADDITIONAL INFORMATION
Shareholder Information
102
BIOPHARMA CREDIT PLC ANNUAL REPORT AND FINANCIAL STATEMENTS 2025
KEY DATES
March Annual results announced
Payment of fourth interim dividend
June Company’s half-year end
Payment of first interim dividend
Annual General Meeting
September Half-yearly results announced
Payment of second interim dividend
December Company’s year end
Payment of third interim dividend
FREQUENCY OF NAV PUBLICATION
The Company’s NAV is released to the LSE on a monthly basis and is published on the Company’s website.
ANNUAL AND HALF-YEARLY REPORT
Copies of the Company’s Annual and Half-yearly Reports, stock exchange announcements and further information on the Company can be
obtained from the Company’s website www.bpcruk.com.
IDENTIFICATION CODES
SEDOL: BDGKMY2
ISIN: GB00BDGKMY29
TICKER: BPCR
LEI: 213800AV55PYXAS7SY24
CONTACTING THE COMPANY
Shareholder queries are welcomed by the Company. While any queries regarding your shareholding should be directed to the Registrar,
shareholders who wish to raise any other matters with the Company may do so using the following contact details:
Company Secretary – biopharmacreditplc@cm.mpms.mufg.com
Chairman – chairman@bpcruk.com
Senior Independent Director – sid@bpcruk.com
REGISTERED OFFICE
19th Floor, 51 Lime Street, London, EC3M 7DQ.
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