Case Background

Our client is a mid-size pharmaceutical company historically focused in pediatric conditions, but currently pursuing a pipeline of new medications and technologies through internal R&D and strategic industry
partnerships.

Our client is seeking to explore opportunities within dermatology and ophthalmology, and has come to us for a strategic recommendation on which of these markets they should enter and how. After preliminary
research and interviews with KOLs, your team has identified the following assets for potential acquisition:

Product A for Hyperhidrosis (HH)

Product B for Wet Age-related Macular Degeneration (wAMD)

Disease Background – Hyperhidrosis

Hyperhidrosis (HH) affects 3% of the US population and is a skin disorder characterized by sweating excessively,
Disease Overview profusely, and visibly without exertion; ~30% of patients with HH are diagnosed

Primary Focal HH (Idiopathic HH) is the most common form of HH (~90% of cases), 30-60% of patients have family
history of the disease
Segmentation
Secondary Generalized HH occurs due to an underlying medical condition such as diabetes or diseases involving the
thyroid

Although Primary HH may improve with age, it often worsens during adolescence and early adulthood

Prognosis Secondary HH can be managed by treating the underlying condition and typically has a better prognosis than Primary
HH

70% of all diagnosed HH patients are treated, but treatment approach varies with disease severity

1st line: Topical antiperspirant treatment

Treatments 2nd line: Oral anticholinergics and/or Botox injections, microwave thermolysis to destruct sweat glands

3rd line (severe patients): Endoscopic thoracic sympathectomy (ETS) procedure to destruct a portion of the
sympathetic nerve

Product A
Topical anticholinergic specifically indicated for Axillary Hyperhidrosis (AHH), or excessive sweating of the underarms, which affects 60% of
diagnosed, treated HH patients

20% improvement on all sweat measuring scales compared to SOC with limited side effects

Currently in phase 3 of development

Disease Background – Wet AMD

AMD is a degenerative disease of the retina that slowly destroys the macula and may lead to visual impairment and
blindness, affecting 3% of the population over the age of 50
Disease Overview
Wet AMD is the most severe form of age-related macular degeneration, affecting 10% of total AMD patients and 90%
of those with severe vision loss caused by macular degeneration; 70% of wAMD patients are diagnosed

Occurs most commonly in patients over the age of 50

Prognosis Tends to progress in the span of weeks or months, ~40% of patients develop bilateral disease

With treatment, some wAMD patients see improvement in disease progression

 60% of diagnosed wAMD patients are treated, the standard of care is below:
Treatments Intravitreal (IVT) injections: In-eye injections administered by a retina specialist on average 8 times / year

Product B
IVT Biosimilar

Currently in phase 3 of development

Question 1: HH Market Sizing

To initially understand the business opportunity of each indication and help prioritize our client’s entry strategy, please:

1. Approximate the number of hyperhidrosis (HH) patients eligible for Product A in the United States

Answer to Question 1

Question 2: Wet AMD Market Sizing

Now that you’ve assessed the size of the Hyperhidrosis (HH) market, please:

2. Approximate the number of Wet AMD patients eligible for Product B in the United States to compare to your previous work

Answer to Question 2

Question 3: Peak Revenue Potential

Now that you’ve assessed the size of the addressable patient population for Products A (Hyperhidrosis) and B (Wet AMD), the client has asked that your team evaluate and make a recommendation for which
product (and indication) to pursue

As your team decides on next steps:

3. Please describe the factors which would be important to consider in any recommendation for which product (and indication to pursue)

Answer to Question 3

ANSWER:
Current and evolving competitive landscape

Market share potential based on anticipated differentiation of client’s product (e.g., efficacy vs. safety/tolerability vs. convenience)

Pricing opportunity

Commercial expenditure and investment requirements

Strategic fit with company vision

Question 4: Peak Revenues Calculation

Using the information provided, please:

4. Calculate the peak revenues of Product A (Hyperhidrosis) and B (Wet AMD)

Product A (Hyperhidrosis) Product B (wAMD)

Addressable Population 1.2M 150K

Peak Share 10% 20%

Price/Year/Patient $1.7K $10K

Product A will launch 1 year after acquisition Product B will launch ~2 years after acquisition
Launch Year
Product A expected to be approved Product B is expected to be approved

Answer to Question 4

Question 5: Indication Prioritization

Now that you have estimated the revenue opportunity associated with each product, your team has regrouped internally to brainstorm any additional considerations which could support either
recommendation to the client

As you prepare for this internal working session:

5. What additional considerations would support a recommendation to pursue Product A for Hyperhidrosis (HH)?

Answer to Question 5

ANSWER:
While the hyperhidrosis market opportunity (i.e., axillary HH patients treated today) represents a large patient opportunity (~1.2M US patients), our client’s product is expected to capture a lower percentage
(~10%) of the overall addressable population. Additionally, the pricing opportunity for Product A in Hyperhidrosis is lower than that of Product B in Wet AMD, which leads to a lower overall revenue opportunity
compared to Product B ($200M vs. $300M).

That said, given HH typically worsens during adolescence vs. Wet AMD, which most commonly occurs in patients over the age of 50 years, Hyperhidrosis represents an attractive market for the client given their
existing presence in pediatric conditions. As a next step, we would want to understand the commercial footprint required to support a successful launch in HH given many patients diagnosed with Hyperhidrosis
are largely managed by PCPs.

Lastly, Product A is expected to generate revenue sooner, being only one year out from launch. This would help support the valuation of Product A vs. Product B, and should be considered as a part of the overall
valuation.

Question 6: Indication Prioritization Cont’d.

Now that you have estimated the revenue opportunity associated with each indication, your team has regrouped internally to brainstorm any additional considerations which could support either
recommendation to the client

As you prepare for this internal working session:

6. What additional considerations would support a recommendation to pursue Product B for Wet AMD?

Answer to Question 6

ANSWER:
The Wet AMD market would represent more of a divergence from the company’s existing focus on pediatric conditions, but could represent an attractive opportunity, given the severity and level of unmet need for
patients diagnosed with Wet AMD.

Despite a lower patient volume for Wet AMD, Product B is able to convert a larger percentage (20%) of patients to Product B. Additionally, given the severity of Wet AMD, Product B is able to achieve a much
higher price point than Product A in Hyperhidrosis ($1.7k vs. $10k per patient per year). Thus, despite the smaller patient population, Product B achieves higher peak revenues than Product A ($300M vs.
$200M).

While pursuing Product B in Wet AMD would be a departure from the client’s existing focus, the small (and likely concentrated) prescriber base for Wet AMD would require less investment to realize this
opportunity. Since Wet AMD is treated by a specialized physician (i.e., Retina specialists), this would likely require a much smaller field force to support the commercial launch vs. HH.

Given Product B is a biosimilar in ophthalmology, pursuing Product B would likely need to be a part of a broader strategy either in biosimilars (given pricing dynamics and strategies which would need to be
evaluated) or ophthalmology (given specialized prescriber base).