Good afternoon, welcome to the Arix Bioscience PLC Investor Presentation. Throughout this recorded presentation, investors will be in listen only mode. Questions are encouraged and can be submitted at any time by the Q&A tab situated in the right-hand corner of your screen. Just simply type in your questions and press send. The company may not be in a position to answer every question it receives during the meeting itself. However, the company will review all questions submitted today and publish responses where it is appropriate to do so. Before we begin, I'd like to submit the following poll, and I'd now like to hand you over to Robert Lyne, CEO. Good afternoon, sir. Many thanks, thank you everyone for joining this afternoon. We're presenting today the financial results for 2022. We'll also include just a strategy recap of the business, an update and portfolio review, a summary and outlook, and then there is some further materials, particularly detailed breakdown of portfolio movements at the year-end in the appendix. 2022 was still something of a challenging year for Arix. We'd expected at the start of last year that things were gonna be difficult. We'd had very much, very difficult public markets, particularly in the U.S., which had begun in 2020 and had moved into 2021. We were hoping at the start of last year that those public markets would recover and also that we would have an improved macroeconomic situation, which would help us as well. We had increased headwinds on both of those fronts, more than we'd expected. As we set out at the start of last year, we were deliberately taking a cautious approach to capital deployment, and in terms of ensuring that we had a high cash balance through the period. That continued as we saw these challenging markets develop and as we thought set a very high bar for future investments. Because of this, we retained a significant cash balance throughout the period. It ended at GBP 3 million, only slightly down on the start of last year. This also was reflective of our cautious capital deployment into the portfolio. We deployed only GBP 11.1 million into existing core investments. Those were selected investments where we felt that they met the very high bar we set. I'll be discussing later in the presentation with one new core portfolio company that we added Ensoma, explaining how that fitted into the criteria that we were setting for new investments in that period. We also continued to look at realizations from the portfolio. As we had these challenging markets of our many listed companies within the portfolio, there were some where we took the difficult decision to realize entirely the positions and get out of those companies. Although they're still doing good work in terms of the clinical trials that they have underway, those are businesses where we don't wish to follow the story any further. By contrast, there are some public companies in the portfolio which we feel have been unfairly undervalued, and we've continued to support those companies, both through our interactions with the management teams and also, in the case of Harpoon Therapeutics, through further investment at the start of this year. In terms of the portfolio itself, there was GBP 134 million raised by portfolio companies last year. That is down obviously substantially on the Q3 of a billion GBP that was raised in 2021. That is a reflection of the challenging public markets, where funding opportunities have been much more limited last year. We're also really encouraged by the fact that so much was raised in 2021, and that ensures that many of our companies are well-funded to continue their clinical trials. For us, that's crucial, as we really don't want to see companies having to fundraise in distressed situations. It's much better for us that they have the capital to continue the work they're doing to generate what we hope will be positive data and then turn that into value creation. Particularly, we hope, in due course, when public markets recover and also M&A activity increases. During the year, we also had two very interesting examples of how companies are raising funds and going public in these times when IPOs are much harder to achieve. One example of that is Disc Medicine. This is a private hematological company which we first invested in the fall of 2021. This company, within only 14 to 15 months, had managed to complete a reverse merger with Gemini Therapeutics, which was a cash shell. This brought the company onto NASDAQ, this was a real validation of the strength of opportunity in Disc. Gemini was a very popular cash shell, they had many potential targets they could have chosen. By choosing Disc Medicine, it validated what we thought was a very strong investment thesis behind that company and the potential for value creation. We've since seen that company trade very well since it since the merger was completed at the end of the year. For most of the start of this year, it's been up roughly 20%, they've also had a very strong run in the last week or so, they're now up circa 70% since the start of the year. On the other side of the equation, we were also part of a reverse merger where we have an interest in the cash shell. As some may remember, last year we had the disappointing news that there were clinical failures at Imara. As I say, that is very disappointing news for us, but we have to be realistic. That is something that does happen in drug development. It is a high-risk business model, and that is why we have a portfolio approach, and this is also why we see really spectacular returns when it works well. In the case of Imara, unfortunately, their clinical programs were not successful. What was important there was that there was a strong management team that instantly took corrective action to close down the programs, sell them for what they could, and they did manage to realize some value there, build up a cash pile, and position the business as a cash shell as a potential merger partner. They managed to make an arrangement with Enliven Therapeutics, which has now reversed into Imara, and that again has been trading well and is well received by the market. As part of that combination, as we'll see later on in the presentation, our percentage shareholding in Imara has reduced because there was a concurrent financing with Enliven as cash and assets were brought into the enlarged company. This has also had the benefit for us in terms of diluting us down whilst actually increasing the holding value of the investment that we have there, providing us with greater liquidity opportunities through this year. In terms of overall NAV performance, there was a decrease from GBP 255 million to GBP 226 million, and that has resulted in a drop in NAV per share to 175 pence at year-end. This is primarily driven by some significant downward valuations in two existing core portfolio holdings. There was Pyxis Oncology, which fell by GBP 10 million during the year. That is a company which was a legacy position for us, and we exited that entirely during the year. There was also the disappointment of a GBP 11 million fall in the value of Harpoon. Now, that's a very significant drop, clearly, and that's a company that we've taken a very close look at as they reposition the business and look to refocus their trial programs and also cut costs. That's a company where we still believe that there is the potential for an active drop and there is the potential for M&A and licensing activity. That led us to consider a really interesting investment we made at the start this year through a preference share investment structure, which I'll describe later on in the presentation. The other highlight we had during the year is to our public opportunities portfolio. Again, I'll go into further detail on this at the end, towards the end of the presentation. The things that we put together at the start of last year, when we could see that the public markets had really crashed in terms of valuations, but we weren't necessarily seeing the same reduction in valuation of the private investment opportunities which were coming into us. Our response to that was to be very cautious on new private investment, and you can see that by the fact that we only added the one company, Ensoma, during the year to the private portfolio. At the same time, we used our skills and capital and expertise to start to invest in a liquid basket of opportunities on the Nasdaq, all in the U.S., of listed companies where we felt they were both undervalued, but also crucially, actually had progress that they'd be making during the year that would lead to reratings of their stocks absent from wider market movements. We've had a lot of volatility in these public valuations in the U.S. over the year, and the XBI, which we feel is the best benchmark index to measure against, has been quite volatile during that period. As we'll show later on, we have outperformed that benchmark, which we feel is encouraging in terms of validating the approach we have taken, but also sets us up well to generate value from this portfolio over this year. We have here a breakdown of the NAV at year-end. As I say, it's deliberately been cash heavy. This is a result of the high cash balances we've been carrying since we have significant realizations from prior exits in the portfolio. As I say, because we are an evergreen vehicle, for us, it's important at strategic times to make sure that we've got enough cash to continue to support and develop the portfolio through times when fundraising may be difficult. We've maintained this high cash balance, which we are still gonna likely to be cautious with over the coming months and the rest of this year, until we see a real change in terms of greater M&A demand, but also the right valuations and entry points for us to deploy capital. In terms of the valuation approach we take with the rest of the NAV, 20% of it is in listed companies, which is mark-to-market, that does introduce volatility into our NAV, but particularly for the POP companies, for the Public Opportunities Portfolio companies, these are liquid positions. We feel that mark-to-market is a very fair reflection of the valuation there and also gives a real-time update when we print our monthly NAVs. In terms of the private companies, those made up just under a quarter of the NAV at the year-end. These are valuations. Our approach here is in line with the international private equity and venture capital guidelines. What we take as a starting point here is we look at the last round price that either we paid or a bona fide or third-party investor paid for equity. However, for us, that's only ever a starting point. What we then want to look at in accordance with the guidelines, and this is something that is verified through our audit process as well, is we look at whether progress has been made, either positive or negative by that company. Also we look as an overlay at whether there are public comps, so listed companies or other indications of value that people are paying at this in the sector to give an idea as to whether we still feel that the valuation is justified. Having gone through that process at the year-end, there were two adjustments we made where we departed from the cost basis that we hold all the, our other private investments at. The first one was in the case of Twelve Bio. This was a company which was acquired through agreement with Ensoma. That's the business I mentioned earlier, which we added to the core portfolio. As part of that financing transaction, they also acquired Twelve Bio. Because that was a transaction that was closed but not completed at year-end, we took a very large part of the uplift that they paid, having acquired Twelve Bio for circa 20% above our holding value. We felt that that was appropriate, and we felt that that was then validated by the completion of the acquisition in February, at which point the full value can be recorded in our books. There was also a write-down during the period of STipe Therapeutics. This is a business which has been in something of a difficult space, particularly raising funds in this environment. We took a 50% write-down on our holding value of STipe at the half year, and when we reassessed this at the year-end, we felt that a further 25% write-down was appropriate, leaving us with 25% of the holding value from the start of the year. We have here a breakdown of the NAV per share over the last 6 months. As you can see, with our cautious approach, the shares are heavily underpinned by cash and also liquid, listed securities, many of which are liquid. Therefore, we see this as a very compelling value opportunity to gain access to our unlisted portfolio. It's also worth bearing in mind that for us, we see that we're still in something at the bottom of the valuation cycle for a lot of these assets. Going forward, we see real potential for significant increases in the value of both the listed but also the unlisted positions that are reflected in our NAV. We have here a breakdown in terms of demonstrating how the movement in the gross portfolio values, this is the value of the investments that we hold, has moved over the year. You can see, we had a starting value of GBP 118.2 million. We deployed GBP 33.6 million into the period. This was largely result of the public opportunities portfolio, where up to GBP 222.5 million was invested at any one time. That's a dynamic number which does shift over the period as we respond to market conditions. There was also just over GBP 11 million that went into existing and new core portfolio opportunities, including Ensoma. There was a minor FX adjustment during the period and then significant realizations. Again, many of these came from the POP, but as we adjusted it during the year and therefore we had to provide a sort of capture as to where we were at year end. There were realizations from legacy portfolio companies, particularly listed companies such as Autolus, LogicBio and Pyxis, where we felt that we no longer wanted to follow that journey. Despite the depressed valuations they may be trading at the time, we felt it was the right thing to take that capital back off the table, return it to the balance sheet and seek out new opportunities for it. Over the period, we did have a net revaluation downwards of GBP 34.5 million, which was obviously a significant value and as I said, a lot of that was largely accounted for by the two significant reductions in valuations of Harpoon and Pyxis over the period. We have here a chart showing out the NAV progression of the business since inception. There has been significant volatility in terms of NAV and the NAV per share here. There was a significant run up from a certain very well-traded listed position in December 2018 which then reversed the following year. As you can see, we had our landmark exit in December 2020 which provided the real sort of explosive growth in NAV and NAV per share that we see possible with our model and with the sort of companies we invest in. Hit that peak in 2020, we then had some decline over the last two years as set out there as public market valuations have reversed in many cases. Clearly we are disappointed with the annualized NAV per share growth we're recording, although that is coming off a very high figure that we had at the end of the 36-month period at the start of the 36 month period in December 2020. Just to recap on strategy. The purpose of the business is very much focused on generating superior events in returns for investors. We do so by a focused portfolio of biotech and the companies in which we invest. It's important for us to remember that these are all developing innovative treatments for patients. In many cases, even where we do have write downs or we do have clinical failures, clearly that is depressing for us. It isn't what we're there to do. We're there to make money, not to lose it. We do think it's important to remember that as we do that, we are trying to develop treatments that are really needed for patients. Even where funding has not achieved the success we'd like, in many cases it does move on science and it does move on our understanding of these areas and does contribute in the longer term to benefits for patients, even if we're not able to make a financial return from that particular investment at the time. In terms of our strategy, for those familiar with the story, this has been consistent. We still take a transatlantic approach, that's because we see Europe and the US as the key geographies where there's the strongest science, but also the strongest management teams and the strongest funding syndicates. It really is that whole ecosystem that is important for us when we're screening for investment opportunities. In terms of the science we look at, we're agnostic in terms of modality and therapeutic area, but we do look for cutting-edge science, so best in class from first in class treatments. These are high risk, but at the same time we see them as having the highest reward, and we feel that that is the right balance on a portfolio approach for us to be taking. We're very much focused on companies that are moving into the clinic, so put their treatments into patients in clinical trials, and those companies which are maybe pre-clinical, but in some way derisked or devalidated, or validated so that we can have some confidence that there's gonna be near-term value inflection points that will provide us potentially with write-ups in our value. More importantly, will provide the potential for IPOs when the IPO window is open, and also M&A exits, which really is our end goal for the companies we invest in. We have here two exciting additions to the board which we made during the year, Debra Barker and Andrew Smith. Both of them are really great examples of how we look for talent when we're adding to our board. It's very important in terms of a governance function, the non-executive directors that we have. I mean, that is first and foremost what they're there for. We also have the opportunity to add real expertise in terms of the industry sector with the people that we work with. I've been delighted to welcome them both to the board this last year. Andrew's already provided a huge help with his experience as a CFO at multiple biotech companies. When we're looking at these interesting and innovative financing structures that companies are having to consider in these difficult times, Andrew's experience is really very useful there indeed. For him, he sort of sat on the other side of the fence from us as an investor, and that dynamic has been very useful as we've been engaging with companies and screening opportunities. Similarly, Debra has had a very distinguished career in big pharma, principally at Novartis, but also at a number of other household pharma company names. Her huge experience, both in terms of how big pharma's looking at drugs, how they're assessing them, how they're looking at prioritization, but as well as practical drug development expertise, has been incredibly useful to us. She's brought that to bear already in many investment opportunities that we've been screening and also those that we have executed on. Again, here is a graphic that'll be familiar to those who followed the Arix story. We have here our demonstration of our investment cycle and why we think that this is the sweet spot for us to be investing in. There is an approximate trade-off between scientific and clinical risk, which is always inherent in what we do, at least up until a drug gets approved, and also the valuation that we have to pay when we start to invest in these companies. The trade-off isn't perfectly linear, but there is definitely a graduation as we move through. For us, we feel that getting into a business when it's late pre-clinical or moving into the clinic and into the phase I, going into phase II, is really when we think is the optimum window where the valuation is still attractive. For meaningful investment amounts, we can still get a meaningful stake in that business, we're not taking quite the same level of scientific and clinical risk we have done if you're literally taking science from the lab bench and starting to put it into a company for the first time. We also feel at this stage, we've got companies that within 18 to 24 months of our investment are gonna be in the zone where there's the potential for IPO activity when the window opens, and also for M&A activity as well. We think Disc Medicine's a great example of that. That's a company that's moved into phase II trials while we've been investing in them. They've now moved into the window where they could IPO, and as I said at the outset, they managed to reverse merger onto Nasdaq. That's now a position where we are locked up as is standard for many of our companies when we go public with them. We will have those lockups off in the summer, and there will be the opportunity for liquidity at that point, which will be a great result from a company that from the start to finish, we've only been in for 20 old months now so far. We have here an overview of the portfolio. This just gives an idea in terms of the balance we look at in terms of having a mix of clinical companies, pre-clinical companies, some that are public, some that are private. As I say, you know, drug development is inherently high risk, and we think that having this spread in terms of the stage of development, but also where the companies are listed. Some obviously will have volatility coming through in terms of their public holding, but also that gives us the benefit of potential liquidity. For the private companies, they don't have that volatility, they don't have those considerations that can sometimes be distracting for management teams, but also we don't have the liquidity. That is something where we think that we want to maintain a nice balance between the two there. We also want to ensure that we have meaningful holdings in these businesses. We don't want to be too focused in any one part of the portfolio to any one company, but at the same time, we want to make sure that the amounts invested in these businesses are meaningful enough that when they have good results, which is what we hope for all of them, the return will be meaningful to our NAV and NAV per share. We have here an outlook in terms of upcoming catalysts over this year, particularly data readouts. For us, data is really the absolute focus of these businesses. Once they're in the clinic, getting phase I, phase III, and in some cases, phase III data is absolutely critical as they move through the development cycle, and they start to demonstrate that the drugs they're developing are first of all safe. Crucially, they can demonstrate some signs of efficacy before they move through to actually getting them approved. For us, we feel that really phase I moving into phase II is a really great entry point. As they start to put out phase II data, we, but also crucially other investors and acquirers, can start to see whether there's real evidence that there is a drug at work there. That is really exciting when we start to see that later stage data. Where the companies are public, when that data comes out, there's the opportunity for an immediate re-rating of those public companies, but also it's something that is disseminated widely on the stock exchange in the U.S., and that provides a great opportunity for potential acquirers to follow the story and understand the data that they're generating and start to take a view as to whether that is a drug that they'd like to acquire. For us, as we look out over 2023, these are gonna be some of the key points we'll be looking at for the companies. Depending on how the markets react, whether companies are public, we have the opportunity to take some liquidity off the table. Of course, there are also opportunities where if we feel that the companies are being undervalued, we might also consider increasing our investment in that business going forward. We have here some donuts just setting out the balance in cross the portfolio. As I said, we try to maintain a balance across therapeutic areas. As I said at the outset, we're agnostic in terms of the therapeutic areas we invest in. Really what drives us is where we think there's going to be pharma M&A interest. Crucially, that's not just about having M&A interest at the time we make the investment. Because of drug development, it happens occasionally, but it's very rare that we make an investment, and then there's a near-term exit immediately. Much more likely is we make an investment, and then the company starts to put that capital to work. It will run a clinical trial, it will generate some interesting data, and that is what then will move the company forward in terms of valuation and potential interest for pharma buyers. Of course, that does take time. When we're looking at therapeutic areas to invest in, a critical piece for us is to do mapping in terms of where do we think pharmas are gonna be buying in the future. This, again, as I was talking earlier about the expertise we've been adding to the board, and especially as we evolve the investment team, this is where we're looking to make sure that we really have that insight. We know the companies we back today are the ones that are gonna be bought tomorrow. We also look to make sure that we have a balance between clinical stage and pre-clinical stage companies. For those that are pre-clinical stage in the standard drug development space, there is often a lag until they're likely to be in the space where they're generating data that's interesting enough to go public or be acquired. We do want to maintain a bias towards the clinical stage there. We also want to make sure that we have a balance between listed and unlisted investments. For us, the unlisted provide a really exciting opportunity where we have privileged access to that deal flow. At the same time, we also recognize particularly the time at the moment when there are depressed valuations, that there is real value in the listed markets if we can approach that and invest smart there. Here's a little bit of a detailed slide, and maybe you look at this in a bit more time later, but this sets out some of the progress that's made in the portfolio through 2022. A real highlight for us was the very positive data that was released by Aura from their phase II programs. Aura's developing a very important treatment for ocular oncology. This is an area where there isn't really a standard of care at the moment, and so it is somewhere where we have a great deal of confidence that that business, if they continue to generate encouraging data, has a very clear path forward for approval and also for frankly then the drug being sold and starting to generate significant revenues. Of course, as with all our businesses, as well as pursuing their own independent development plans, there's always the potential for these companies to be subject to M&A activity, and that's something which we follow very closely with each of them.As I mentioned at the outset, there was only one company that we looked to invest in during the year in terms of a new private company that we added to the core portfolio.This was a business we signed the agreements at the end of the year and closed in January, a funding round into Ensoma.This was a $9 million investment, and it was a very interesting opportunity.It came to us originally because the company was actually looking at acquiring Twelve Bio, which was an existing core portfolio company of ours. They were looking at Twelve Bio because they were very interested in the gene editing technology they had, which in 12, which was gonna be added into the Ensoma platform, where they had a broader platform of delivering gene editing drugs and mechanisms through this program. When they first came to us, we engaged about the acquisition potential for Twelve Bio. That was something we understood it was gonna be an all-share transaction. That was something we were supportive of. It also opened up the opportunity for us to invest in Ensoma directly. We very much looked at those as the two separate transactions. For us, the acquisition Twelve Bio was great, but we really wanted to make sure that also we were looking at the investment proposition standalone in Ensoma, notwithstanding the fact that there was an acquisition going on as well. For us, the standalone investment case for Ensoma was very strong. It's a very exciting platform that they've put together there. We see it as de-risked in multiple ways, and we think that this really is gonna be a very exciting company going forward. It's backed by very strong syndicate, 5AM Ventures and other very strong existing private VCs who are already in the business. As part of the funding, they attracted more cash from the Gates Foundation and also the Qatar Investment Authority. Obviously, both of those are very highly rated investors with very deep pockets and are gonna be able to support this business well going forward. The other strategy and action point we'd like to highlight is Disc Medicine. I've spoken around this already, but again, just to recap, this is a business that we only invested in September 2021. It's already made great progress moving the programs through clinical development. They've got 2 phase two readouts coming this year and have managed to complete the merger with the merger which they closed earlier this year with Gemini in December at the end of the year. This has now meant that they're now a public company. They're very well-funded. Their funding was even added to at the start of this year for the investment that was led by Bain Capital. That provided $62.5 million into the business. $58 million of that came from Bain, that's now given this business strong runway through into 2025. As I outlined earlier, for a lot of our companies, we're really focused on making sure that they are well-placed and well-funded to pursue their development programs through 2023, particularly as a time when we see that for some of these companies, there may be difficulties in raising capital. It's very reassuring for us when we know that they've been able to access top capital sources and also then have that cash on their balance sheet to pursue their business plans going forward. As I outlined again at the start, we had, we were encouraged by the performance of the public opportunities portfolio. This was a new strategy for us that we put in place at the start of last year. It was a situation where we felt that there was undervalue in some of these public companies, both on an individual basis, but also more broadly in terms of the sector. As we saw interest rates rise, particularly through the year, we saw a continued risk-off mentality, and we think that is continuing. However, looking more broadly, and this is relevant for the POP, but it's also relevant for a lot of our public positions that we have. We do think that we are gonna see through the peak of interest rates during the course of this year, particularly as inflation finally washes out of the system. As we can start to see the peak and the potential even for rates to come down towards the end of the year, we think that will generate a shift again into more of a risk-on mentality amongst investors, and we will see cash inflows back into the biotech stocks in the U.S., which underpin the valuation of the XBI, but also have the potential to impact the valuation of the public holdings that we have. We put together this public opportunities portfolio, and as you can see, there's been a lot of volatile trading, which has been mirrored to some extent by the XBI. Certainly since the summer, we've managed to sustain a continued outperformance of the XBI portfolio. At the moment, it's sitting roughly at cost. Obviously, you know, for us, that is something that we think positions us very well as those individual companies have the potential to make significant progress on their own terms, but also as we see a shift in favor back in the market. For us, it's encouraging, as I say, that we are outperforming the XBI by 13%, as of the middle of this month. As we move to the outlook, we've had continued progress in 2023. As I outlined earlier, there was a financing into Disc Medicine led by Bain Capital that we found very encouraging in terms of the capital that's gonna be available to Disc now to continue its programs going forward. We also had a very innovative financing structure that was put in place for Harpoon Therapeutics, and we see that as a really great example of the flexible mandate we have here at Arix. As I said, as well as being flexible in terms of our scientific areas where we invest and the modalities of the technologies that the companies are using, we're also very careful to be open-minded around whether we're making public or private investments, depending on where we see the potential for value. Even within those public and private investments, what we've started to take a look at, particularly as we've had a more challenging funding environment in the public companies, is whether there are innovative structures that we can put in place to help the companies move forward, but also to capture value for us as an investor. Harpoon's a great example of that. This is a business we've known for a long time. They suffered a very significant fall in valuation during 2022. Nonetheless, we do believe that there is value in the programs that they are moving forward, and we and other insider investors want to continue to support those programs. Previously, Harpoon has always fundraised through straight equity investments, and when valuations are strong, that is very straightforward. At a time when the valuations, we thought, were not reflecting the potential within Harpoon, we didn't want to lead a very dilutive financing of that company. Instead, what we did is put together a structure of preference shares, redeemable preference shares, where we put an investment in. We did three and a half million dollars out of the $25 million total. That money has gone into these preference shares, which sit at the top of the equity stack. That gives us some downside in the event that Harpoon doesn't perform as we'd hope. Also it gives us actually a preferred pre-structured return in the event that Harpoon is sold or in the event that they license one of their programs. For us, we can see a clear path if they are successful and if there is licensing income to a pre-agreed return, which will be a potential multiple of the amount of money we've invested there. As well as that potential multiple on the preference share return, we also have the potential, of course, for creating value from the existing equity position which we still hold, and also we were issued with warrants, as part of that transaction, which provide a further potential for value creation. For us, that was a great example of how we've had to think creatively about how we fund some of these companies in this challenging time, ensuring, first of all, that they can continue the work they're doing and provide the potential for us to get value through our existing equity exposure, but also that we can then get a fair return for the risk we're taking in this structure going forward. As we continue to look out at the rest of this year, we're gonna continue to be selective and cautious in terms of capital deployment. For us, we found that actually over the last year, it served us very well to continue to maintain significant cash balances. As an evergreen fund that is looking to invest across the cycle of these businesses, it's important that we have that visibility to be able to support these companies. We will still look to continue to develop the portfolio, but it will all be about making sure that there are companies that meet the high bar that we're setting, and only then will we look to deploy capital. More broadly, as I explained a little earlier, we're starting, we think, to see a turn in terms of the macro environment over the course of this year, but of course, events will determine how that plays out. Also what we have started to see very particularly in the biotech space is M&A activity starting to come back. There's been quite a few very big blockbuster transactions. Horizon, for instance, was very significant, and also Seagen at the start of this year. Also what encourages us is recent acquisitions such as GSK's purchase of BELLUS Health for $2 billion. That was the purchase of a clinical stage phase II company for $2 billion, which is exactly the type of transaction that's gonna drive value in our portfolio. Historically, before the markets really collapsed in value a couple of years ago, there was a lot more M&A activity in the sort of $750 million-$3 billion space of clinical stage companies with phase II data. As you can see from the portfolio descriptions we have, that's exactly where we're positioning the companies that we invest in. For us, starting to see that kind of M&A activity return, that is what is really exciting in terms of driving value and driving potential for cash returns back to the balance sheet. For us, fundamentally, we see that on a broad scale, big pharma still have very large cash balances despite the significant transactions that they've announced, and they also do have a need to restore their pipelines and continue to make sure that they have the potential for new drugs moving through development. We don't see that fundamental driver has changed. We think that M&A activity will come back, and we're monitoring closely to see as deals get announced, where pharma are investing and how they're starting to deploy their cash balances and what that might mean for potential value creation in our portfolio. Summarizing here, we have our rolling 36 month goals. The absolute key for us is double-digit NAV per share growth. That is the way that we can deliver value for the investors who bought our shares. We have subsidiary goals of additional IPOs and exits. That is something that we have currently met on the rolling 36 month period up to the year-end. Of course, for us, those are really only subsidiary goals. What matters is the double-digit NAV per share growth. As I outlined at the start, that has been clearly disappointing on a rolling 36 month basis to the year-end 2022, albeit it was coming off a very strong peak that we'd had at the start of that period. We're well positioned as an evergreen business with the cash that we have. It's crucial that we focus on having a lean cost base and keeping our net costs as far below 2% of NAV as we can. We're very aware that we have to make up any costs that we spend in terms of NAV growth to ensure that we deliver value for shareholders. That is something that we watch very carefully. We continue to make sure that we have a diversified portfolio so that it can weather some of the ups and downs of the markets and deliver value over the medium to long term. Thank you for your attention there. I hope that's been helpful. We'll now move through to the Q&A. Robert, thank you very much for your presentation. Ladies and gentlemen, please do continue to submit your questions just by using the Q&A tab, which is situated on the top right corner of your screen. Just while Robert takes a few moments to review those questions that have been submitted today, I'd like to remind you that a recording of this presentation, along with a copy of the slides and the published Q&A, can be accessed via your investor dashboard. Robert, as you can see, received a number of questions throughout today's presentation. If I could just ask you to read out those questions and give responses where it is appropriate to do so, I'll pick up from you at the end. Certainly. Certainly. We'll work through the questions that have been submitted. There were some submitted before time. If we'll start with those. First question was: Have you considered getting involved in listed companies like Destiny Pharma? Company that's promising with good tech, I believe works, but could need funding assistance to avoid further dilution. Currently, the cash and previous investments aren't doing us any favors. Destiny Pharma is an interesting opportunity. Debra Barker, who's joined the board, is a director there, and so that is a company that we have some insight into. Certainly, you know, they've got a lot of potential as a business there. To date, we have taken the view that we really want to focus, in terms of our public investments, on companies that are listed on NASDAQ. For us that is the market where we see the greatest liquidity, we see the greatest analyst coverage and the greatest support for the businesses. A frustration we have even with companies that are listed on NASDAQ is where they have delivered what they said they would do. They've produced strong data in their trials, they're moving them forward. There isn't been a change in the competitive environment, and yet they aren't getting the value recognition. For us, for example, we see Aura as an example of that. Of course, there are other companies such as Disc Medicine that are very exciting and are getting re-rated and are getting a strong following on the NASDAQ in terms of, and that's reflected in the share price that they have. For us, when we look at the public opportunities as well as the individual potential of the company, for us it's important to think even if those companies deliver on what they're doing, which is not easy, it is difficult what they're doing. We don't then want to have this added risk of not only do we have the clinical scientific of what they're doing, we then have a sort of value translation risk that because of the exchange they're listed on or because of the current public market attitude, they may not get the recognition that's deserved. For us, NASDAQ is where we focus today. We do continue to look at opportunities elsewhere, but we do see, even though there are difficulties on NASDAQ, that is really where we see the greatest confidence that companies will get re-rated and they will be rewarded if they perform well. The next pre-submitted question was a question on cash. While waiting for suitable bioscience opportunities to arise, why is Arix not investing its cash balances in fixed term deposits with state banks to earn 4%-5% interest, one year fixed term deposit with Lloyds, Barclays, Standard Chartered, J.P. Morgan, et cetera, returns only 5%. Surely at least half the cash could be invested for a year, if not safe money market funds which allow access to cash within 24 hours are paying 3%-4% interest. Why not make easy money which should cover annual running costs? This is a very good question, and this is something we've actively developed and did respond to during the year just gone. Obviously there's been a significantly changed interest rate environment that has had something of a negative impact in terms of general sentiment to higher risk investment opportunities such as those which we participate in. Obviously as we have high cash balances, that has also been an opportunity for us to generate additional financing income. That's something we very much reacted to last year and we're continuing to react to now. In terms of how we think about our cash deposits, we do obviously hold some cash in terms of instant access in order to run the business and make sure that we can react to dynamic opportunities such as the POP and also, if there are any near-term funding opportunities. The other cash deposits we put out on a ladder, so there's a liquidity ladder to make sure that those deposits are earning interest at a reasonable term. Even beyond that, we are actually looking at and have recently purchased at the start of this year, some U.S. Treasuries. We see our capital deployment as always likely to be in dollars, so we're relatively comfortable putting long-term money out on dollar accounts. We see U.S. Treasuries as yielding very attractive returns and with short maturities, we could have high degree of confidence that actually that would match up with our capital deployment horizon. For us, that is something we take very seriously and as indicated in the question, it is something where it does help offset our running costs, and we expect that to be reflected particularly over the course of this year, depending of course, on where interest rates go. Per info supplied, NAV is GBP 1.71 a share basis, 129 million shares, market cap GBP 132 million, NAV GBP 221 million. If you consider listed shares, GBP 49 million cash, GBP 108 million and other GBP 3.1 million are correctly valued, that means the value that the unlisted securities must be GBP 21.8 million negative. Why? Do the calculations suggest better communication? This issue should be addressed. I find the reporting a little bit pity without a better analysis of the overall portfolio. Please discuss on the call. Look, very happy to discuss this on the call. Obviously, we are frustrated at the discount that we see in the share price. We have full confidence in the value of the NAV, but we have seen a number of private equity vehicles. Not only Arix have significant deratings in terms of the discount they're supplied. Obviously, we do see that the company is well underpinned with cash and listed. We do believe that our NAV is well validated in that sense. We also recognize that as an ongoing evergreen business, there are many investors who apply a blanket discount to venture capital and private equity vehicles, regardless of the cash composition on the basis that over a significant period of time, cash will be deployed and will be used into private opportunities. This is something that we've seen across the sector in terms of discounts. It is very frustrating for us because of course it doesn't translate into value for shareholders, and that's what we're here to do. We're always looking to improve communication and help to explain the story, explain where we see value. For us, I think it's fair to say that has been more challenging over the last 18 months as we've seen a dearth of M&A and significant depressed public valuations. We haven't had as many good news stories in the portfolio. Whilst we have had strong clinical progress, really what we found in the past makes the difference is when we get strong positive cash realizations back to the balance sheet. That in the past is what's closed the discounts and I'm confident that's what will happen in the future. We do need to be patient and ensure that these companies develop their potential, generate the data that we think is possible, and then wait for the right M&A conditions for these businesses to transact at attractive valuations. When that happens and we see a validation of the model in the portfolio, cash returning to the balance sheet, that is in the past where we've seen a closing of the discount, and that's where I think we'll see it again. Can you explain what you have GBP 108.7 million cash? As an investor, this needs to be explained. Is it because you cannot find good business opportunities because the market is overvalued, or do you need this money for financing future financing needs? Or unlisted or listed investments. Some more analysis of this would be helpful. Thanks. Yep. I mean, look, as explained, we are cash heavy. That's something that we took a deliberate view strategically on last year, and we're continuing to be whilst the markets are volatile, and we are being cautious. for us, it is a sort of it is two sides of one coin. You know, we want to set a very high bar for investments, particularly on the private investments, where we've seen elevated valuations that haven't yet come down. That's something that we wanted to make sure that we are careful about. We don't want to be investing at the top of the valuation cycle, which is something we could have done if we'd taken a different approach to capital deployment 18 months ago. At the same time, as an ongoing evergreen vehicle, we're conscious that we do need that cash in order to sustain the business model over the medium to long term. We are careful with that. We do look at how we can generate the greatest returns in terms of cash management, as I talked about earlier. We see that cash balance as integral to the ongoing business model, particularly at the moment with the valuations that we're seeing. Next question is, now you've sorted out all the corporate governance issues, are there any plans to move to a premium listing from the current standard listing in the next year? Certainly the move to a premium listing is something that we do keep under review. We're conscious that it can make a difference in terms of encouraging confidence from shareholders in terms of the strength of governance and reporting obligations that come with a standard listing. Obviously, there are some liquidity concerns that we need to make sure that we are addressing as well, but this is something which we keep under review, and certainly if there is a decision made to move to a premium listing, we will make an announcement to the market so that all the shareholders are aware. Can you tell us more about Mark Chin's departure? Why now? Implications of the portfolio and approach. Does it echo a turnaround mentality? So obviously, as we announced today, Mark has left the business. This is something which is partly on good terms. It's a mutual agreement we've had with Mark. I've worked with him now, he's been with the business for six years, and I've worked with him on and off for five years now. It was the right time, I think, for him to move forward. Certainly, having built a great U.S. portfolio, we're conscious as we look at portfolio balance, that we want to make sure we're focusing as well on opportunities in Europe. Tassos, who's joining us in a few weeks' time, a key focus for him will be to start to build out that portfolio in terms of European businesses where we see the similar quality of potential science and where we see strong enough investment syndicates and management teams as well. Often, sometimes you can see more attractive valuations in European businesses. For us, we see that as a useful shift in the business going forward. Targeting a cost run rate within 2% of net asset value under normal market conditions. What's normal market conditions? Give a little detail on other expenses of GBP 2.6. Yes, looking at terms of the cost run rate, of 2% normal market conditions, obviously, we put in that qualifier when we were considering how best we communicate our cost-based target because we have at times significant exposure to volatility in public markets. What we've not wanted to have is a situation where we're going to have a real hit in terms of having to make costs cuts to staffing or cuts to our capabilities simply because there's been what we may believe is a temporary decrease in terms of the public value that has hit the NAV. That is something where we do look at a 2% target, and as I say, we're very conscious that 2% means that we have to generate at least that just to keep the costs covered and make sure that we're not decreasing the NAV over the period before we start generating any positive returns. At the same time, we haven't wanted to commit to a totally fixed percentage, which sees us cutting costs and having to damage our capabilities if we think there's been a temporary dip in valuations that we think will recover over time. Given benefits of portfolio effect, should you move up risk profile to more bombed out and shunned earlier stage companies? Given U.K. general market valuations low relative to the U.S., should you consider more U.K. life science businesses looking for combo value and perhaps a capital market cycle tailwind that is less U.S.-centric going forward? It's a good question. I think it feeds into some of the considerations that I discussed at the outset, where, you know, from our view, we do see even lower values in the London market and some other European exchanges. For us, the concern is always will we see a recovery in those valuations in the same way that we will in the U.S.? That is something where we still have some hesitancy. We still see that there just isn't the depth of analyst coverage in the European exchanges, even in London. We don't see the same depth of investor interest in the sector as well. Our concern is even though there is significant value there, and we see companies that are doing the right things, the concern is always will that be rewarded in a way that will make money for us? At the moment, that has been the big hesitancy we've had before we invest in those markets. We've had another question which is where is the cash in hand kept? Does it earn interest? I think we've already addressed that. Do you look at likely demand, affordability, and margins of a successful outcome? Yes, absolutely. When we're looking at our investments, the starting thesis when we ever look at a company is what is the indication, what's the disease that they're targeting? How is the drug gonna work, and what's the potential revenue that that drug could generate? When pharma comes and buys these programs before approval, what they're looking at is what peak sales for the drug is it gonna generate? You then have the valuation driven off a multiple of peak sales. That's something where we look at that very carefully. That is the sort of starting point in terms of where we see the end value, and then we work backwards and we start to say, okay, there's a huge patient population here. Sometimes if it's rare disease, it's a very small patient population with high premium pricing. We look at those two different variables. What do we think peak revenue can be? What do we see pharma buying sort of these sorts of drugs with these sorts of revenues for? We get that idea on what the exit value can be. We look at the competitive landscape, particularly emerging competitive landscape. We look at where the drug is gonna get prescribed. To be totally honest, when we're looking at pricing these drugs, it's all driven off the pricing in the U.S. and Europe. Clearly, these are drugs that can be made available more broadly. Of course, in the fullness of time, when drugs move off patent, there's even greater ability for these drugs to be shared more globally. For us, as an investor, our starting point is looking at demand in Europe and North America. Those are the key markets. They drive where the pricing comes from. They drive where the peak revenues are gonna come from. That's how we look at the potential value of the businesses when we invest in them. You talked about new non-execs. There's been a lot of turnover in recent years in the investment management team. Can you please comment on this? Yes, there has been a lot of turnover in terms of the management team, investment team, also the non-execs. You know, the business has had a little bit of a convoluted history. There's been different strategies that have been overlaid onto the fundamental structure of the business since the start. That fundamental structure has really retained the same, which is investing in these biotech opportunities, exciting life science opportunities, and generating returns on an evergreen basis. That has retained consistency throughout, and as I said, during the presentation, this is a long-term investment vehicle. One does need to have that long-term time horizon as we move forward. We obviously had some shareholder engagement a couple of years ago. That resulted in significant change on the board. We have continued to evolve the board since then. I'm delighted that Debra and Andrew have come to join us. That's been a real strengthening both of the board and the governance structure, also in terms of capabilities we have as an investment vehicle. I see that as only positive going forward. Also in terms of the investment team, we again are further evolving that, as I discussed. That, I think, will provide us with new capabilities, particularly as we look to invest in the European market, private market. Do you think that any of the private holdings you may have to undertake write-down financing. Do you think that any of the private holdings may have to undertake down round financings this year, and thus you may have to accept a write-down the current carrying values? This isn't something that we foresee for any of the companies other than there is the potential for STipe. As I said, that is a business which is in need of funding, and that is in a difficult market to raise funds at the moment. Over the course of the year, there's been an adjustment down of 75%. That is something where we have taken that decision. We think that reflects the fair value of the business. Of course, we continue to engage with that company, to see how it can be best supported going forward. Elsewhere in the portfolio, as I say, it is well-funded, we don't see the need for significant fundraisings in the private portfolio over the course of this year. That for us is very important. At a stage when fundraising has become more challenging, it's important these businesses can move through that phase. Nonetheless, when we're looking at the valuations we're holding, we also make sure that we do have a disciplined approach to looking at the public comps and saying, "Okay, even if we think that this is where it's still valued at in terms of the valuation privately, what does it look like in the public setting?" For instance, in the case of Artios, that is our largest private holding. It accounts for roughly half the private valuations. There, there's a very close comparator in a company called Repare Therapeutics, which is currently trading at a significant premium actually to where we hold our post-money valuation of Artios. As well as our own view on the progress of that business, we do also sense check against the nearest public comparator to make sure that it's something that we still think is valuable and of a fair value that we hold it. There's another one. How would you define successful exits? Any specific IRR in mind? Look, you know, I think we've always tried to make it clear we want the exits to be successful because, you know, it's not a case if we're exiting these businesses, and we have done this in the past, where there's been an exit, a sell down, for example, and we've lost money overall, and that does happen in a portfolio approach. You know, we don't consider that obviously a successful exit. In terms of the IRR we're targeting, for us, it depends upon the potential value in the opportunities. As I say, really, what we look at originally is what is the potential exit value for this business when we're investing? When we're going in, we're really looking for a minimum of 3-5x return potential from day one. The exit timing for these businesses is very tricky. The reality with the kind of companies we invest in is that they're bought, not sold. That is something where, you know, we cannot control that timing. If they go public, there are liquidity opportunities. Whilst they remain private, we can't control the timing of those exits. We can package them as well as we can, and we can try and make connections to big pharma, but they will be bought when they're bought. For us, the time differential in terms of the IRR is difficult for us to target at the outset, but what we can target is the money multiple. Also, of course, what we look to target overall is the double-digit NAV per share growth that we see as the guiding target for the business. Robert, thank you very much for addressing all those questions from investors. Of course, the company will review all the questions submitted today and will publish their responses on the Investor Meet Company platform. Just before redirecting investors to provide you their feedback, which I know is particularly important to yourself and the company, Robert, could I just ask you for a few closing comments? Certainly. Well, look, I appreciate everybody's engagement, and it's very helpful to have the questions. For us, it's really important that we engage directly with shareholders, and certainly I found Investor Meet Company to be a really great platform to engage directly, particularly with retail investors. Since Arix's inception, the business model has always, we've felt, made a lot of sense for those wealth managers and retail investors who are looking to get diversified exposure to biotech investments. It is a volatile industry, and we've seen that with our own returns. Also what we have seen historically is a potential for really very significant positive returns when it works well. We're currently going through a difficult environment, both in terms of our own sector and also slightly more broadly in terms of risky equity investments. For us, we think the long-term fundamentals are there for real significant value creation, and that's what we focus on as we move forward. Robert, thank you once again for being so generous with your time and updating investors today. Could I please ask investors not to close the session, as you'll now be automatically redirected to provide your feedback in order that the management team can better understand your views and expectations. This will only take a few moments to complete, but I'm sure be greatly valued by the company. On behalf of the management team of Arix Bioscience plc, we'd like to thank you for attending today's presentation, and good afternoon.