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BIOTIME INC filed this Form 424B3 on 02/04/2019
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Asterias Projections (in millions)
   2019   2020   2021   2022   2023   2024   2025   2026   2027   2028 
Risk Adjusted Net Income / (Loss)   (12.2)   (18.3)   (16.3)   (16.5)   (16.3)   (14.9)   (14.2)   (3.9)   26.5    57.7 
    2029    2030    2031    2032    2033    2034    2035    2036    2037    2038 
Risk Adjusted Net Income / (Loss)   79.3    83.6    101.6    114.6    121.5    126.2    130.5    134.8    139.3    144.0 


Projections Used By Raymond James With Respect to the Future Operations of BioTime


The assumptions and financial estimates regarding BioTime that is included in the Projections Used By Raymond James were prepared based on public financial projections prepared independently without input from BioTime but were modified based on Asterias management’s own view on the probabilities of success for BioTime’s clinical product candidates. The modified assumptions that were used to revise public financial projections related to the probability of success for BioTime’s OpRegen and Renevia product candidates. For OpRegen, Asterias management applied a cumulative probability of success from Phase 1/2 to commercialization of 14% for Dry AMD. For Renevia, Asterias management applied a probability of success of 35% for obtaining European approval in HIV-related FLA and a cumulative probability of success to commercialization for indications beyond HIV-related FLA of 9.4%. BioTime did not prepare or review such projections, and Asterias did not seek BioTime’s review, of such projections.


BioTime Projections (in millions)
   2019   2020   2021   2022   2023   2024   2025   2026   2027   2028 
Risk Adjusted Net Income / (Loss)   (44.9)   (48.4)   (72.3)   (104.8)   (46.2)   97.8    209.9    266.8    409.2    523.3 


Maxim Projections


The Forecasts used by Maxim, which were approved by BioTime for use by Maxim in connection with its opinion were prepared based upon certain non-public financial analyses and projected cash-based data relating to Asterias initially prepared by Asterias management and modified by BioTime after making certain adjustments to the computation of cash flows that were deemed appropriate by the BioTime management. The projected cash-based data provided by Asterias to BioTime consists of (i) projections relating to Asterias’ OPC-1 clinical program that Asterias provided to BioTime in the first quarter of 2018 (the “OPC1 Projections”) and (ii) projections relating to Asterias’ VAC2 clinical program that Asterias provided to BioTime in October 2018 (the “VAC2 Projections”). When Asterias updated its projections for OPC1 in October 2018 (the “Updated OPC1 Projections”), and provided the Updated OPC1 Projections to Raymond James in connection with the rendering of a fairness opinion, Asterias did not provide, and BioTime did not use, the Updated OPC1 Projections because BioTime had already did extensive analysis of Asterias’ OPC1 program using the OPC1 Projections, as modified by adjustments deemed appropriate by BioTime since OPC-1 is an early stage candidate that recently entered clinical development. On the other hand, Asterias did provide to BioTime with the VAC2 Projections in November 2018 because BioTime had not previously prepared a VAC2 model due to VAC2 being in an earlier stage of clinical development. The Forecasts used by Maxim were made available to Maxim for purposes of its financial analysis as to the fairness of the merger consideration from a financial point of view to BioTime and its shareholders. Below is a description of a number of the main adjustments made by BioTime to the projections prepared by Asterias to create the Forecasts used by Maxim.


  Development pathways and expenses – For OPC1 Japan, the clinical development pathway was adjusted to reflect the regenerative medicine conditional approval pathway as stated in the Revised Pharmaceutical Affairs Act (rPAA).  This development pathway calls for a small Japanese Phase 2 study followed by up to five years of on-market patient registry data.  For VAC2, the costs of the Phase 1 non-small cell lung cancer trial were removed as the trial is 100% funded by Cancer Research UK (CRUK).
  Probability of Success – Probability of clinical success assumptions were adjusted to reflect therapeutic area historical data as summarized in the BIO Industry Analysis Report: “Clinical Development Success rates 2006-2015”.  For the US OPC1 forecast, the probability of success by stage was adjusted using the neurology therapeutic area historical data such that the cumulative probability of Phase 2 through approval success became 14.25 Vs 21.3%.  For Japan, the neurology P2 success rate was used for both the Phase 2 study as well as the on-market registry for a cumulative probability of success of 31% Vs 21.3%.  For VAC2, the oncology therapeutic area historical data was used such that the cumulative probability of success from Phase 1 through approval became 5.1% Vs 12.5%
  Addressable population and penetration – For VAC2, adjustments were made to the forecast assumptions to reflect opinions of immune-oncology therapeutic area experts (KOLs) from a marker research study commissioned by BioTime.  The addressable population of patients (those patients who could possibly benefit from a therapy) was adjusted from 15% to 40% in US and EU and 30% in China to reflect KOL views on success rates of approved therapies and the move to combination immunotherapies.  The peak penetration rates (the percentage of addressable patients that may go on a therapy) was adjusted from 15% to 20% in the US and EU.
  Commercialization scenarios – All forecasts were set to a ‘go-it-alone’ scenario meaning the combined entity would develop the therapies through to approval and would commercialize.  For VAC2, the royalty payable to CRUK was added to the forecast scenario.



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