This is a lesson plan for life sciences

1. Don
Stewart,
PhD
President
&
CEO
PlantForm
Corpora4on
Toronto,
Canada
don.stewart@plan4ormcorp.com
Looking
beyond
VCs:
Alterna5ve
funding
routes
for
early-­‐stage
life
science
companies

2. About SecureDocs
AppFolio SecureDocs is a virtual data room for sharing and
storing sensitive documents both internally and with
outside parties.
AppFolio, Inc. Company Basics:
• Founded by the team that created and launched GoToMyPC
and GoToMeeting
• Backed by leading technology companies and investors
• Web-based business software for financial and legal
professionals

3. PlantForm
Summary
• Canadian
private
corpora=on
established
2008
• Plant
expression
technology
licensed
from
the
University
of
Guelph
• $3.5
million
in
funding
from
Founders
&
Angels
• $2.0
million
in
funding
from
Government
• $2.1
million
contract
revenue
in
2013
• 4
families
of
patents
filed
Innovator
of
the
Year
Guelph,
Canada,
2010
Mind
To
Market
Finalist
Ontario,
Canada,
2011
Winner
Most
Promising
Technology
2012
Venture
Forum
(New
York)
Dr.
Chris
Hall.
Co-­‐founder
&
CSO

4. PlantForm
Pipeline
Pipeline
Drugs
Biosimilar
Hercep5n®
Biosimilar
Avas5n®
Biosimilar
Erbitux®
HIV
an5bodies
Butyryl
cholinesterase
Poten5al
Market
Size
$
7bn
$
6bn
$
4bn
Market
Entry
2016
2017-­‐019
Ongoing
revenue
stream
U.S.
Defense
Advanced
Research
Projects
Agency

5. More that 20 years experience in drug development and
approval. Worked with Cangene, which grew from a 10-­‐‑
person start-­‐‑up to an 800-­‐‑employee, $250 million
biotechnology company. Experience in all aspects of
drug development and regulatory approval of parenteral
drugs.
Don Stewart PhD
President & CEO
Co-­‐‑founder
Director R&D
President and
owner
Consulting company founded in 2007; supporting
Biotech and Pharma in translation of parenteral
manufacturing processes from the laboratory bench to
GMP manufacturing facilities. Opening sales
opportunities in Canada for international companies
Presenter

6. Polling
Ques=on
#1

7. Finding
Angels
§ GUST
database
(h^p://gust.com)
§ Example
—
Los
Angeles:
• Angel
Groups
– AngelVision
Investors
– PCN
Los
Angeles
– Icon
Angels
• Venture
Funds
– Kline
Hawkes
&
Co
– Rivenrock
Capital
– Macquarie
Allegiance
Capital
– Barre^
• Business
Plan
Compe==on
– UCLA
Knapp
Venture
Compe==on
• Your
network
of
other
start-­‐ups
• Conferences
• Trade
commissions
• State
agencies

8. Angel
Networking
Conferences
– SoCalBio
Investor
&
Partnership
Conference
• 6
November,
2013
@
Omni
Hotel,
LA
• h^p://www.socalbio.org/
– Keiretsu
Forum
San
Diego
• h^p://www.keiretsuforum.com/global-­‐chapters/san-­‐diego/
– Beer
&
Partners
• Investment
Fair,
London,
UK
(Spring
and
Fall)
• h^p://www.beerandpartners.com/
– Biotrinity,
UK
• May
2014,
London,
UK
• www.obn.org.uk
– Bright
Buffalo
Niagara
Venture
Forum
• h^ps://gust.com/r/sessions/via_group/25737

9. Angels:
GUST
home
page

10. GUST
Experience
– Searchable
internet
portal
to
access
angels:
h^p://gust.com/
– Need
to
load
detailed
informa=on
– Video
helps
– Business
plan
helps
– Detailed
financials
help
– Requires
effort
to
be
useful
– Entrepreneur
needs
to
drive
the
process
– Not
everyone
responds
– Use
by
spam
organiza=ons
to
mine
for
start-­‐ups

11. GUST
PlantForm
home
page

12. Angel
Funding
Process
• Many
groups
have
their
own
applica=on
format
in
addi=on
to
GUST
– Time
consuming
• Angel
groups
like
to
provide
mentoring
for
pitch
– Time
consuming
and
not
always
helpful
• Angel
groups
due
diligence
can
involve
considerable
educa=on
on
your
area
– Time
consuming

13. Angels:
Third-­‐Party
Finders
Professional
finders
• Upfront
fees
+
expenses
• Fees
to
present
at
conferences
• Success
fee
(Cash
and
Warrants/Op=ons)
• East
Coast
Group
– $17,000
fees
– 2
Conferences,
Stamford
and
New
York,
USA
• No
personal
commitment
• For
PlantForm:
No
investment
Ad
hoc
finders
(investors)
• No
upfront
fee,
pay
expenses
• Success
fee
(5-­‐7%
Cash,
5-­‐7%
Op=ons)
• Well-­‐connected
individuals
do
groundwork,
organize
groups
in
a
home
or
restaurant
• Prospec=ve
investors
want
to
meet
CEO
• For
PlantForm:
4
events
=
$500,000
investment

14. Polling
Ques=on
#2

15. § Objec=ve:
obtain
non-­‐dilu=ve
funding
-­‐ Pharmaceu=cal,
Agricultural
and
Biotechnology
Companies
-­‐ Government
contracts
and
grants
-­‐ Founda=ons
§ Core
project
support
-­‐ Directly
advances
companies
objec=ves
§ Non-­‐core
project
support
-­‐ Reduces
burn
rate
-­‐ Increases
“cri=cal
mass”
in
organiza=on
-­‐ Can
advance
IP
por4olio
§ Must
have
demonstrate
capability
-­‐ Lab
opera=ons
-­‐ Equipment
-­‐ Personnel
Market-­‐driven
Development
Contracts

16. § United
States
• DARPA,
$1.8
million
R&D
Contract
• www.so.gov
• h^p://www.darpa.mil/Opportuni=es/Solicita=ons/
DARPA_Solicita=ons.aspx
• h^ps://www.dtrasubmission.net/SignIn.asp
• h^p://www.grants.gov/
• Gates
Founda=on,
$750,000
Development
Contract
• h^p://www.iavi.org/
• h^p://www.gatesfounda=on.org/
§ Canada
• Undisclosed
>$1
million
contract
• h^p://www.merx.com
PlantForm
Development
Contracts

17. § Government
and
Founda=on
proposal
process:
-­‐ Funding
cycle
or
open
=meframes
-­‐ Specific
topics
or
white
paper
proposals
-­‐ General
stages
of
applica=on
process:
• LOI
>
Summary
>
Full
Proposal
§ Pharma,
Ag
and
Biotech
proposal
process
-­‐ Website
applica=on,
ini=al
review
of
interest
• Syngenta
(www.syngentathoughtseeders.com)
-­‐ Network
Contacts
-­‐ Industry
associa=ons
support
• MaRS,
Toronto
(www.marsdd.com)
Securing
Development
Contracts

18. Conferences:
§ Examples
-­‐ BIO,
San
Diego
2014
(conven=on.bio.org)
• One-­‐On-­‐One
Partnering
a
must
-­‐ Bio-­‐Europe,
Vienna,
Nov
2013
(www.ebdgroup.com/bioeurope)
-­‐ Bio-­‐Europe
Spring,
March
2014,
Turin
(www.ebdgroup.com/bes)
-­‐ BioPharm
America,
Sept
2013,
Boston
(www.ebdgroup.com/bpa)
-­‐ Sachs
and
Associates
Forums
(www.sachsforum.com)
-­‐ Conference
strategy
(advance
research/game
plan)
§ Approach
-­‐ Extensive
use
of
partnering
systems
-­‐ Set
up
other
mee=ngs
prior
to
conference
-­‐ Take
advantage
of
networking
events
Securing
Development
Contracts

19. § Networking
with
Contacts
§ Trade
Commissions
§ Industry
Associa=ons
§ SBIR/STTR
(www.sbir.gov)
-­‐ SBIR:
support
Small
Businesses
to
engage
in
Federal
R&D
with
commercial
poten=al
-­‐ STTR:
support
coopera=ve
R&D
between
Small
Business
and
Research
Ins=tu=ons
for
project
with
commercial
poten=al
-­‐ Phase
I,
the
startup
phase,
makes
awards
of
"up
to
$150,000
for
approximately
6
months
support
for
explora=on
of
the
technical
merit
or
feasibility
of
an
idea
or
technology."
-­‐ Phase
II
awards
grants
of
"up
to
$1
million,
for
as
many
as
2
years
in
order
to
facilitate
expansion
of
Phase
I
results.”
Securing
Development
Contracts

20. Securing
Development
Contracts
Government
support
• Canada
– h^p://www.tradecommissioner.gc.ca
– (Not
the
same
as
US
FTC)
• Cheryl
Rogers,
San
Diego;
Chris=ne
Sarkisian,
Boston
• Benjamin
Eliasoph,
Technology
Partnering
Officer,
DC
– Connected
PlantForm
to
partners
in
Italy,
USA,
Australia
• USA
– Organiza=ons
such
as
Interna=onal
Trade
Center
(www.intracen.org)
– Missions
• States
– Establish
a
presence
in
other
countries
• North
Carolina
Biotechnology
Center
(www.ncbiotech.org)
– Missions

21. Development
Contract
Issues
§ Cau=on
§ You
are
sharing
data
and
ideas
with
your
compe==on
§ Mi=ga=on
§ Must
have
a
Non-­‐Disclosure
Agreements
§ Must
track
and
record
all
informa=on
provided
§ Use
secure
data
rooms
on
internet
§ Control
who
views
§ Record
of
what
was
viewed
§ Use
to
gauge
interest
level

22. Development
Contract
Issues
§ Pros
– Provide
non-­‐dilu=ve
funding
– Advance
companies
products
or
core
technology
§ Cons
– Not
necessarily
aligned
with
primary
corporate
direc=on
– Requires
significant
use
of
resources
– May
require
addi=onal
non-­‐core
hires
(project
or
customer
rela=onship
management)

23. Partnerships
to
advance
business
development/financing:
§ Objec=ve:
Secure
$7
million
project
cost
to
next
significant
financing
milestone
§ Summary
diagram
Crea=ve
Financing
Partnerships
Cash
investment
Contract
manufacturing
Preclinical
services
Clinical
Services
Government
Grants
Government
Loans

24. $7
million
project
cost
§ Equity
– $2,000,000
from
Angels
and/or
Service
Providers
§ Upstream
Greenhouse
services
– 50%
of
cost
(not
disclosed)
– Business
synergy
§ Downstream
Purifica=on
services
– 50%
of
cost
(not
disclosed)
– Business
synergy
§ Preclinical
– 100%
as
equity,
Technomark
Lifesciences
– www.technomarkls.com
§ Phase
I
clinical
– 20%
as
equity,
Cato
Bioventures
– www.catobioventures.com
Crea=ve
Financing
Partnerships

25. Blended
Funding
Model
Project
Poten5al
External
Funding
Ac5vity
Cost
Source
%age
Amount
Manufacturing
Process
Scale-­‐up
$696,051
Service
providers
50%
$348,025
Manufacturing
3x
GLP
Processes
$1,392,102
Service
providers
50%
$696,051
Manufacturing
1x
GMP
Process
$696,051
Service
providers
50%
$348,025
GLP
Mouse
Efficacy
Study
$139,210
GLP
Pk
Study
$69,605
Technomark,
Equity
100%
$69,605
Safety
and
Toxicity
Rodent
Study
$278,420
Technomark,
Equity
100%
$278,420
Safety
and
Toxicity
Monkey
Study
$1,113,682
Technomark,
Equity
100%
$1,113,682
Safety
and
Toxicity
Other
Studies
$139,210
Technomark,
Equity
100%
$139,210
Characteriza=on
Studies
$500,000
Ontario
program,
Loan
100%
$500,000
Stability
Study
$250,000
Ontario
program,
Loan
100%
$250,000
IND
Submission
$100,000
Ontario
program,
Loan
100%
$100,000
(Grant)
$0
Ontario
Program,
Loan
100%
$650,000
Phase
I
Clinical
Trial
$1,392,102
Cato
Bioventures,
Equity
20%
$278,420
TOTAL
PROJECT
COST
$6,766,433
SUB-­‐TOTAL
EXTERNAL
$4,771,440
EQUITY
RAISE
$2,000,000

26. Summary
of
issues
• Pros
– Access
to
investment
in
a
=ght
money
market
– No
change
in
control
of
the
Company
• Cons
– Hard
to
find
opportuni=es
– Large
amount
of
due
diligence
– Difficult
to
bring
different
par=es
together
at
the
same
=me
Crea=ve
Financing
Partnerships

27. Polling
Ques=on
#3

28. Financing
from
the
Middle
East

29. Financing
from
the
Middle
East

30. Financing
from
the
Middle
East
§ Sources
-­‐ Sovereign
Funds
• >$500
million
-­‐ Investment
Funds
• >$100
million
-­‐ Private
Funds
• >$10
million
-­‐ Zakat
Funds
• >$10
million
-­‐ Strategic
Investors
• $10-­‐30
million
-­‐ Private
Banking
• $4-­‐6
million
and
$1
million
§ Total
ask
and
tranches
larger
than
in
USA
-­‐ ENBD
minimum
$30
mm
for
Series
A

31. Financing
from
the
Middle
East
Issues
§ Funds
for
financing
are
available
-­‐ Abu
Dhabi
GDP
$248
billion
in
2012,
largely
from
oil
-­‐ Qatar
GDP
$189
billion
in
2012,
largely
from
natural
gas
• Abu
Dhabi
Investment
Authority,
ADIA
(www.adia.ae)
• Abu
Dhabi
Investment
Council,
ADIC(www.adcouncil.ae)
• Qatar
Investment
Authority,
QIA
(www.qia.qa)
• Ras
Al
Khaimah
Investment
Authority,
RAKIA
(www.rak-­‐ia.com)
§ Sophis=cated
investors
with
general
knowledge
base
§ Commitment
to
partnerships
§ Interest
in
investments
that
commit
to
local
ac=vi=es
-­‐ Job
crea=on
-­‐ Facility
builds
§ Tawazun
Holding,
an
offsets
program
which
can
be
used
to
assist
with
financing
(www.tawazun.ae)

32. Financing
from
the
Middle
East
Issues
§ Synergy
with
Government
objec=ves
in
diversifica=on
-­‐ United
Arab
Emirates
Vision
2021
•
(www.vision2021.ae)
• “UAE
drives
toward
economic
diversifica=on
less
reliant
on
oil.
Expanding
new
strategic
sectors
to
build
long-­‐term
compe==ve
advantages.”
-­‐ Abu
Dhabi
Economic
Vision
2030
• (gsec.abudhabi.ae/Sites/GSEC/Naviga=on/EN/publica=ons,did=131400)
• “Comprehensive
plan
for
the
diversifica=on
of
the
Emirate’s
economy
and
a
significant
increase
in
the
non-­‐oil
sector’s
contribu=on
to
GDP
by
the
year
2030.

33. Financing
from
the
Middle
East
§ Man
on
the
ground
-­‐ Important
to
have
a
knowledgable
and
locally
experienced
contact
-­‐ PlantForms
contact
is
a
Canadian
who
operates
a
management
consul=ng
business
in
Dubai
§ C-­‐level
presence
on
the
ground
-­‐ CEO
must
be
on
the
ground,
supported
by
CFO
and
other
C-­‐level
staff
-­‐ PlantForm
aims
to
be
in
the
region
every
month
-­‐ This
takes
=me
and
resources
away
from
other
ac=vi=es
§ Embassy/Trade
commission
support
-­‐ Useful
for
general
connec=ons
and
trade
missions
-­‐ Embassy
of
Canada
to
United
Arab
Emirates
• h^p://www.canadainterna=onal.gc.ca/uae-­‐eau
-­‐ Embassy
of
the
United
States
to
United
Arab
Emirates
• abudhabi.usembassy.gov

34. Polling
Ques=on
#4

35. PlantForm
Timeline
in
the
Middle
East
Year
Month
Ac5vity
2011
October
Healthcare
conference
in
Abu
Dhabi
November
3
mee=ngs
with
investment
group
2012
January
Term
Sheet
presented
by
Investor
($10
mm)
February
–
March
Due
Diligence
and
discussion
April
Investor
withdraws
(lost
$170
mm
on
another
deal
in
USA)
May
Investor
introduces
Company
to
Emirates
NBD
Bank,
Dubai
June
–
October
3
Dubai
visits
with
ENBD,
developing
understanding
at
bank,
securing
posi=ve
opinion
from
risk
group
November
Mee=ngs
with
10
poten=al
investor
groups,
Abu
Dhabi,
Dubai,
Qatar
to
test
waters
December
Execute
Mandate
agreement
with
ENBD
Con=nued….

36. PlantForm
Timeline
in
the
Middle
East
Year
Month
Ac5vity
2013
January
Mee=ngs
in
Dubai
Selec=on
of
lawyers,
Dubai
Due
diligence
by
ENBD
and
Lawyers
February
Mee=ngs
in
Dubai
Company
posi=on
papers
wri^en
Market
evalua=on
by
consultant
March
Mee=ngs
in
Dubai
Consultant
review
of
drug
product
Consultant
reviews
(2)
of
animal
studies
Presenta=on
materials
dra~ed
April
Mee=ngs
in
Dubai
Final
Offering
Memorandum
and
Term
Sheet
Final
Presenta=ons
(15
and
80
slide
versions)
Con=nued….

37. PlantForm
Timeline
in
the
Middle
East
Year
Month
Ac5vity
2013
May
Introduc=on
of
project
to
marke=ng
to
ENDB
Investment
Banking
Investment
Banking
ini=ate
marke=ng
June
Mee=ngs
in
Dubai
Introduc=on
of
project
to
marke=ng
to
ENBD
Private
Banking
Rela=onship
Managers
Private
Banking
ini=ate
marke=ng
Mee=ngs
with
Investors
in
Abu
Dhabi,
Dubai,
Ras
Al
Khaimah
&
London
UK
July
Ongoing
marke=ng

38. Financing
from
the
Middle
East
Summary
of
issues
• Posi=ves
– Financing
available
– Tranches
much
larger
than
in
US
– English
language
in
the
business
and
social
environments
– UK
law
for
business
• Issues
to
address
– Time
required
on
the
ground
to
generate
and
advance
leads
– Need
to
understand
local
business
culture
– Need
to
be
flexible
and
use
locally
accepted
business
prac=ces

39. Which
Road
to
Travel
Where
would
PlantForm
focus
for
early
financing
knowing
what
we
now
know…..
1. Founda=ons
and
Family
Offices
($500-­‐$2,000,000)
1. Project
financing
2. Milestone
driven
3. Do
not
want
control
2. Individual
Angels
($25-­‐100,000)
1. Day
to
day
funding
2. Steady
influx
of
capital
3. Can
make
a
special
drive
for
an
intermediate
milestone
3. Middle
East
($10
million
plus)
1. Significant
capital
depth
2. Increasing
interest
in
diversifying
investment
por4olios
3. Board
presence/shareholder
control
but
opera=onal
control
remains
with
Company

40. Discussion
Don
Stewart,
PhD
President
&
CEO
PlantForm
Corpora4on
Toronto,
Canada
don.stewart@plan4ormcorp.com