Form 4: Baker Bros. Advisors Acquires Additional Stake in Bicycle Therapeutics via Private Placement

Baker Bros. Advisors and affiliated entities increased their holdings in Bicycle Therapeutics through a private placement of non-voting ordinary shares.

Summary

• Baker Bros. Advisors LP, along with related entities, filed a Form 4 disclosing changes in beneficial ownership of Bicycle Therapeutics plc (BCYC).
• On May 29, 2024, the Funds (667, L.P. and Baker Brothers Life Sciences, L.P.) purchased 1,429,986 and 15,684,860 non-voting ordinary shares, respectively, at $21.42 per share through a private placement.
• These non-voting ordinary shares are immediately convertible into ordinary shares on a 1-for-1 basis, subject to a beneficial ownership limitation.
• The beneficial ownership limitation initially restricts ownership to 9.99% of outstanding ordinary shares but can be increased to 19.9% with written notice to the Issuer.
• Baker Bros. Advisors LP submitted notices to increase the Beneficial Ownership Limitation from 9.99% to 19.9% on April 16, 2024, and May 28, 2024, related to the Pre-Offering and May 2024 Non-Voting Ordinary Shares respectively.
• These increases will take effect on June 16, 2024, and July 29, 2024, respectively.
• After the reported transactions, Baker Bros. Advisors LP and affiliated entities beneficially own 1,793,439 and 20,027,289 Ordinary Shares respectively.
• Felix J. Baker, a managing member of Baker Bros. Advisors (GP) LLC, is a director of Bicycle Therapeutics plc.
• Other reporting persons are deemed directors by deputization due to their representation on the board of directors of the Issuer.

Sentiment

Score: 7

Explanation: The increased investment by a reputable firm like Baker Bros. is generally a positive signal, suggesting confidence in the company's future performance. However, the beneficial ownership limitations and waiting periods introduce some constraints.

Positives

• Baker Bros.' increased investment signals confidence in Bicycle Therapeutics' prospects.
• The ability to convert non-voting shares into ordinary shares provides flexibility for Baker Bros. to adjust their ownership stake.
• The increased Beneficial Ownership Limitation allows Baker Bros. to potentially increase their ownership in the future.

Risks

• The conversion of non-voting shares is subject to beneficial ownership limitations, which could restrict Baker Bros.' ability to fully convert their holdings.
• The increase in the Beneficial Ownership Limitation is not immediate and requires a waiting period.

Future Outlook

The document indicates potential for Baker Bros. to increase their ownership stake in Bicycle Therapeutics, subject to beneficial ownership limitations and waiting periods.

Industry Context

Baker Bros. Advisors is a well-known investment firm specializing in life sciences companies, so their increased investment in Bicycle Therapeutics could signal positive sentiment towards the company's prospects within the biotechnology industry.

Comparison to Industry Standards

• Baker Brothers are known for long term investments in biotech companies such as Seagen and Incyte.
• Their investment in Bicycle Therapeutics is similar to their other investments in the biotech industry.

Stakeholder Impact

• Shareholders may view the increased investment by Baker Bros. positively, potentially leading to an increase in share price.
• The capital raised through the private placement could enable Bicycle Therapeutics to further advance its research and development programs.

Key Dates