SDBN Bootstrapping Biotech Final

Bootstrapping Biotech

Wifi Password: tanguero
Presentation: http://sdbn.org/bootstrap
October 29th, 2009 SDBN Networking Event

~60 min. presentation
Interrupt at any time
http://sdbn.org/bootstrap
Presentation & Resources
Videos of event
List yourself!

What is Biotech?
*Data from Biocom’s Product Database
**Additional data provided by CleanTECH San Diego

val⋅ue
/ˈvælyu/ noun, verb
relative worth, merit, or importance: the value of a college education; the value of a queen in chess.
monetary or material worth, as in commerce or trade: This piece of land has greatly increased in value.
the worth of something in terms of the amount of other things for which it can be exchanged or in terms of some medium of exchange.

Value
Create
Getting funding
What is your product?
Commercialize
Finding & protecting technologies
Turning products into profits
Communicate
Who cares?

Steve Scott
CEO ofTechnology Acquisition Group
Over 25 years leading companies to the next level. Frequent Interim CEO
Six acquisitions, 3 turn arounds
14 boards
Launched over 220 products
300 million raised Twitter: Steve Scottstevescott@techacq.com

Lorna Neilson
Founder and Principal, inGENEuity Life Science Group, LLC
Ph.D., Molecular Biology
Over 17 years in Biotech/Life Science Industries
Corporate & Business Development, Licensing, Marketing, R&D

Large and small public companies and start-up private companies
Applied Biosystems, Invitrogen (now Life Technologies), Sequenom, GeneFormatics, Reprogen, Isis Pharmaceuticals

Certified Licensing Professional
Served on several M&A due diligence teams
Lead negotiator/ integration leader for company acquisition by Invitrogen

Mary Canady
Founder & Principal, Comprendia LLC & SDBN
10 yrs at bench & computer
Highly technical structural biology research
9 yrs marketing & business development
Large (Invitrogen, Calbiochem/EMD) & small biotech/life science
Social media
Established biotech & science
Blogger/microblogger, thought leader

David Welch
Written, directed, and produced more than two hundred films, videos, and commercials
Broadcast-quality presentations cover all three sectors of biotechnology and have focused on:
immunotherapies, Alzheimer’s, MS, various cancers, cellulosic ethanol and biofuels, malaria, transgenic seeding and genetically enhanced farming methods, gene silencing, and animal viruses
First Place honors for several biotech videos in major national film contests.
Jim Greenwood, CEO of the Biotechnology Industry Organization, calls David Welch “one of the best in the business when it comes to telling biotech’s story.”

Give Me Money
Presentations which Attract
Investment
Tell Them What They Want to Know
Steve Scott, CEO, Technology Acquisition Group

Bio-B
Monitoring with Style
San Diego, CA

Problem – Crippling Costs
Researcher
Lack of Quick Subject Identification
High cost: estimated 25% of staff time
Loss of sensor and data stream
Resident
Desire for individual styles

The Problem
What pain does your solution solve?
How big is the problem?
How much does it cost?
Ideal customer

Bio-Bling

Sensitivity Measurement

Your Solution
Picture of product
Diagram of product or service
Main benefit
How much does it save

Simple Distribution
Standard Lab Supply
Catalog
Web
3 distributors signed
Promotional

How do you generate revenues?
Operate your business
Gain market share – Go to market strategy
Focus on realistic operation and distribution
Only the most important points

Market Growth
Dollars (m)

Marketing and Sales
Size of opportunity
Market segments
Served available market is key
Graphics best

Competition
Easy
BLING
Isolation
Color Dot
Tatoo
Painful
Slow
Fast

Competition
Competitive landscape
Direct and indirect
Map
Competitive Advantage
Matrix

Technology
Color change based on chemical sensor and temperature change
Future activity/passivity sensing

Underlying Magic/Technology
Concepts only
Differentiation from competitive methods
IP strategy mentioned in presentation

Projections

Projections and Milestones
Typical 5 year forecast
Review possible revenue sources
Total Revenue
COS, SG&A
Net Profit
Some add residual cash line
Don’t need details

Management Team
CEO – E. X. Harve
Harvard Medical
Katrina Rodent Project
CTO – Keep M. Glowing
CTO 25 yrs - Dow Chemical DOD
CMO – M. Slinger
Former CMO – Roche, J&J, Fischer, Beckman, K-Jewelry, Mousekateers

Your Team
Sell your accomplishments
High value associations
Schools, companies, awards, big titles
One of most important slide in preso
Offer a plan to fill gaps

Use of Funds
Funds Raised 750K

Your Funding Need
How much are seeking?
Use of money
How long will it last
Will you need more money later?

Corporate Development
Scale up
Production (I)
Scale up
Production (II)
Market Launch
Project
Milestone
Pilot Test
Petri Ring
Development
Phase I
Development
Yr 1
Yr 2
Yr 3
Yr 4
Yr 5
Yr 0
Financial
Milestone
Fund
Raising (I)
US$ 750k
Fund
Raising (II)
US$ 1.5M
Exit

Status and Timeline
Show what you’ve done
Where you are
When you will do the next steps
Technology, business and funding
Exit plan
Gantt chart or timeline

Strong market demand
Scalable product
Large cost improvement
Time saving
Individual identity
Seeking $750,000 for market launch
Contact: exHarve@biobling.com

Summary & Call to Action
How much capital are you seeking?
Key strengths
Contact info

Commercializing
Technology & IP Strategy
Life Science Group, LLC

Position for Success
Ideal position for new ventures

Commercializing R&D
The Development Gap

The Development Gap
Too New
lack of validation by other parties and/or commercial acceptance
Too early in development
vicious cycle - need money to complete development
Weak IP position
e.g., early patent applications or need 3rd party IP

Solution for Patent Problems

Key Strategies for Success
Must have a business plan
Executive summary, team biographies
Product(s) description, including IP
Market and competitive research
Go to Market plan
Develop a budget/funding strategy
Have intellectual property (IP) strategy
Think about exit strategies

Intellectual Property
Different factors to consider
One strategy per product or technology
Several strategies for the business
Funding consideration
Patents
Trade Secrets
Technical Information
Know-How

IP Strategy
IP creates value by giving investors confidence to invest
Discourages others from trying to develop the same technology
The starting point in develop IP strategy that fits company business objectives

Development Parnerships
Research Grants
Universities, Foundations and Research Institutions
Biotech to Biotech
Biotech to Big Pharma or Dx

Getting Started
Bi-lateral Agreements
Joint research
Invest in the biotech company
Up front payment and/or milestone payments
Sponsored research
Opting in, Opting out – at different stages
Distribution

What to Pay Attention To
License Fees
Joint funding of development, manufacturing, commercialization, or marketing
Loans
Equity Investments
Joint Investments
Steering Teams
Intellectual Property Issues (prosecuting, enforcing and maintaining patents)
Transferability

Agreements Are Often Interrelated
consulting
IP License
training
Investment
Services
R&D
Distribution
manufacture
Technology licensing occurs in the context of a business relationship in which other agreements are often important

An IP Strategy Has 3 Goals
Secure freedom to operate
Establish control over intellectual property assets
Develop and assert an IP portfolio that provides meaningful exclusionary power for the company’s products in the market

Preparation For Negotiation
What is the business reason for this license?
What leverage do you have?
What is the time frame for signing the license agreement?
What data and documents do you or the other party need?
What are your positions on the key issues of the license?
What is your negotiating strategy?
Will you need preliminary agreements?
What are the strengths of the other side?

Term Sheet
The Term Sheet provides a solid foundation for negotiation
Clarifies issues
Shows problem areas
Communicates to each team
Clears positions
Keeps track of goals

Summary
A technology at any stage of development may be appealing to an industry strategic alliance partner
Licensing and commercialization occurs more often between people who know each other – network!
There are many approaches and ways to structure deals
Proper management of IP assets can create greater value for the company

Resources
Licensing Executives Society (LES) www.lesusacanada.org
Association of University Technology Managers (AUTM) www.autm.net
inGENEuity Life Science Group, LLC www.ingeneuityllc.com

Marketing Plan: Commercializing
Market Research
What do your customers want?
How much are they willing to pay for it?
What is your customers’ perception of you?
Format
Interviews
Focus groups
Online survey

Customer Profiling
Who is your customer?
What are their daily ‘pains’?
Where are you likely to reach them?

Competitive Analysis
Identify
Analyze
Is your offering unique?
How will you compete?
SWOT Analysis
Strengths, Weaknesses, Opportunities, Threats

Marketing Plan: Communicating
Positioning & Messaging
What is your niche?
What is your value?
How will you compete in the long term?
How will you communicate your message?

Communication Tactics
Materials
Content
Branding
Print & online media
Presentations
Planning
Campaigns
Conferences
PR
Media placements

Communicating 2.0
Smaller companies can do more
Get by with help from friends
Engage, don’t broadcast

Social Media: How?
Create a community that cares about you & your product
Spend more time than $$
Learn from others
http://sdbn.org/sdsms
http://sdbn.org/sms
We can help! http://comprendia.com/socialmedia

Check out the Appendix & http://sdbn.org/bootstrap for more information

Case Study: SDBN
San Diego Biotechnology Network
Founded Oct. 2008 by Mary & Partner
Mission: Promote communication in the San Diego Biotechnology community
Monthly events focus on hot science, networking, and workshops
Promotion via Social Media (SM)
LinkedIn (2100+)
Twitter (950+)
Meetup (175+)
Facebook (300+)
Amazing growth—85-100 at each event
Branch out to charity events, mini-conferences
Engage Scientists in SM to help grow

Case Study: TigerTox
Inspired by Comprendia, SDBN
Build Toxicology ‘community’
Needs: Logo, Website/Blog, PowerPoint Template
BioStartup™ Marketing Kit
Creative Brief Process

Case Study: TigerTox
Complete Package
Also Provided
Training
Materials
Blog/website up
Full story

Science Communication 101
What we will discuss:
The importance of video
How to leverage social media
Integration of video with traditional public relations
Creating a buzz

What is it?
Why are we doing it?
How are we doing it?
Biotech Branding Campaign

Biotech Branding Campaign

WhatCanBiotechDoForYou.com

IAmBiotech.org

Telling the Story
Why it’s important to use stories to
communicate science:
Stories help put a human face on the biotech industry
They show how science offers hope to the world

Telling the Story
Using video
Why it’s important
If you can’t view this video watch it at http://sdbn.org/wcs1

Telling the Story
How video can help explain complicated science
If you can’t view this video watch it at http://sdbn.org/wcs2

Telling the Story
What are your options?
High-end video production
Flip cameras
If you can’t view this videos watch them at http://sdbn.org/wcs3

Promoting videos through social media
Video 2.0

Video 2.0

Video 2.0
Cost and analytics
Total # of people who
the ad was shown to
Total # of clicks resulting
from promotion of 1 video
in 2 months
Average cost per click
was just 23 cents
% of people who clicked
through the promotion

Traditional Communications Vs. Web 2.0

“Buzz”: Why You Want it and How You Get it
Leveraging your social media presence
Build your network
Develop strategic partnerships

Self-promote ONLY after promoting others
Know your audience and cater to their needs
Make it worth their while to listen
Provide interesting content
Respond to feedback

How do you create a buzz? It’s simple:
Communicate; stay informed; and differentiate yourself, your company, and your products

Next Steps
Find us after the presentation to be interviewed on camera for IAmBiotech.org
Sign up on IAmBiotech.org and get involved!
Ask us how we can help you: http://WHITECOATstrategies.com

Appendix: Funding Resources

Appendix: Bootstrapping Resources