Cowen Royalty invests in healthcare companies and products across a broad range of therapeutic areas predominately in the U.S. and European Union. The Firm targets investments between $20 million and $100 million, but can execute significantly larger transactions. Our deep healthcare, finance, and investment expertise enables us to structure creative transactions that cater to the financial needs of the counterparty and maximize value for all parties involved. The capital that Cowen Royalty provides allows counterparties to transfer product and execution risk, finance new development opportunities, acquire new products or technologies and fund additional capital needs.
Traditional passive royalties are investments in existing royalty contracts. These royalty contracts are entered into when an inventor, university or company signs an IP licensing agreement with a third-party marketer. Under these licensing agreements, the inventor, university or company is entitled to receive a stream of cash flow payments based on the future sales of the product. Cowen Royalty will acquire all or part of the royalty contract and receives the resulting cash flows.
Synthetic Royalties® are highly structured, non-dilutive financing alternatives for companies seeking to raise capital in lieu of issuing traditional debt or equity. In a Synthetic Royalty® investment, Cowen Royalty creates a royalty contract with a company that markets one or more healthcare products. The contract entitles Cowen Royalty to receive a stream of cash flow payments that are primarily secured by the future sales of the healthcare product(s) as well as by the underlying product assets.
Structured royalty debt consists of securities that are collateralized by royalty streams. In structured royalty debt, the issuer usually places the royalty contract(s) into a special purpose vehicle and issues debt in the asset-backed securitization market.