Successfully reported this slideshow.
We use your LinkedIn profile and activity data to personalize ads and to show you more relevant ads. You can change your ad preferences anytime.

Raising money for_life_sci_co_02-23-2015

430 views

Published on

On February 23, 2015, the MIT Enterprise Forum of Philadelphia hosted a forum on raising money for early-stage life science and healthcare companies. In a discussion hosted by moderator Steve Bowman of Busclarity, panelists Jim Stuber and Bernard Rudnick addressed the subject from the point of view of founder and funder, respectively, with input on IP issues from Baker Hostetler's Jeffrey Rosedale.

  • Login to see the comments

  • Be the first to like this

Raising money for_life_sci_co_02-23-2015

  1. 1. Raising Money for Life Sciences and Healthcare SPONSORED BY BAKER HOSTETLER FEBRUARY 23, 2015 1
  2. 2. The Current Fundraising Environment: A Perfect Storm NASDAQ Biotech Index up 177% in past 36 mo 45 2013 IPOs, 74 in 2014, 2015 tracking higher 2014 VC Life Science funding highest since ‘07 2014 VC =$8.6 billion in 789 deals Most Pharma/Biotech collaborative deals Earlier stage Pharma/Biotech deals Pharma incubators – Merck, J&J, Pfizer, others 2014 FDA drug approvals at 20 yr. high - 35 2
  3. 3. How am I (funder) going to make money? Removing risk and adding value by achieving milestones ◦ Technology risk ◦ IP/Competitive risk ◦ Regulatory risk ◦ Market risk The exit can occur anywhere along the path The path and exit is different for devices, drugs, and biologics (and distinctions are blurred) However, there has to be a way eventually, for someone to make money Know the commercial environment (different in US than Europe, ROW) U.S. since Affordable Care Act, etc. 3
  4. 4. De-risking and increasing value by hitting milestones VALUE RISK MILESTONES 4
  5. 5. How am I (funder) going to make money? Removing risk and adding value by achieving milestones ◦ Technology risk ◦ IP/Competitive risk ◦ Regulatory risk ◦ Market risk The exit can occur anywhere along the path The path and exit is different for devices, drugs, and biologics (and distinctions are blurred) However, there has to be a way eventually, for someone to make money Know the commercial environment (different in US than Europe, ROW) U.S. since Affordable Care Act, etc. 5
  6. 6. Exit strategies Sale to strategic buyer Initial public offering Sale to private equity group Others 6
  7. 7. How am I (funder) going to make money? Removing risk and adding value by achieving milestones ◦ Technology risk ◦ IP/Competitive risk ◦ Regulatory risk ◦ Market risk The exit can occur anywhere along the path The path and exit is different for devices, drugs, and biologics (and distinctions are blurred) However, there has to be a way, eventually, for someone to make money Know the commercial environment (different in US than Europe, ROW) U.S. since Affordable Care Act, etc. 7
  8. 8. A New Era in Medical Technology Adoption Source: Joe Camarrata jcamarrata@gmail.com 8
  9. 9. Funding Timeline Recall: Removing risk and adding value by achieving milestones The path is different for devices, drugs, and biologics (and distinctions are blurred) Typical milestones: Initial determination of market, need, solution, competition, and adoption (value proposition) Advisory board / KOPs License agreement Utility patent filed Team/Board of Directors FDA meeting FDA/CE Mark approval (510(k) or PMA) CPT Code by CMS / Private plan approvals Utility patent issued 9
  10. 10. Sample: Funding, Operations & Financial Results 2011 2012 2013 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Funding (All money in to date $6.5m) Product 1 Product 2 Product 3 Product 4 Product 5 Product 6 Revenues EBIT Diagnostic Products Therapeutic Products $2.5m $4m $6m $5m $105,000 $7,682,700 $26,059,500 ($4,596,368) ($1,142,632) FUNDING, PRODUCT ROLLOUT, AND FINANCIAL RESULTS - YEARS 1-3 7,906,344 10
  11. 11. Bake the Cake – Matters You Must Address [Title/Intro] Market Opportunity ◦ Problem/Opportunity (Unmet Need) ◦ Market Size Product/Service Description Competition / Competitive Advantage IP/Regulatory/Reimbursement/ Adoption Go-to-Market Strategy / Operations Plan / Time to Market / Price; Cost to Manufacture Financial Projections / Funding Plan Management Team / Advisory / Professional Ask & Use of Funds Exit Strategy / Return on Investment [Summary] [Contact] 11
  12. 12. Key Factors Affecting Investment Management and advisors Market size and access Choice of target and time to market ◦ Size, cost and timing of trials ◦ Time to proof of concept in humans ◦ Partnership availability in geography of prevalence ◦ Timing on partnership or collaboration ◦ Partner strategic plan which matches Manufacturability and cost Regulatory pathway and similar approval history Disruptive nature of target or pathway Valuation Funding needs to each value enhancing milestone Funding history from start date Funds needed now and needed in total Use of funds with a focus on G&A References Competitive environment ◦ Penetration of drugs used now for same indication Workflow as compared with standard of care Exit strategy and timing 12
  13. 13. Formats Elevator Pitch (Stand up, intro) One-Pager (Venture Fair Format) Slide Deck ◦ 10-Slide Summary (to be emailed) ◦ 12 Minute (Venture Fair – designed to “get the meeting”) ◦ 30 Minutes (for in-depth meeting at VC’s office) Business Plan – Executive Summary (3 pages), Full Plan (50 pp.) Financial Projections (Financial plan) Gantt Charts (Ops plan) 13
  14. 14. Funding Plan Equity Funding Path: Founder, Friends & Family Angel Investors Organized Angels/Seed Stage VCs Early Stage VCs Series A VCs/Industry Partners Series B, etc. VCs/Industry Partners Non-Dilutive Funding: SBIR Grants, NIH Grants Foundations Keystone Industrial Zones Industry Partnerships Revenue 14
  15. 15. Resources Biostrategy Partners University City Science Center – QED Program Wharton Small Business Development Center Dream It Ventures University City Keystone Industrial Zone PACT Conferences Pa Bio Conferences Pharmaceutical Consulting Consortium International 15
  16. 16. Example: IPart & SBIR/STTR Funding Workshop When: March 5, 2015 @ 8AM-11:30AM Where: Ben Franklin Headquarters, 4801 South Broad Street, Suite 200, Philadelphia, PA 19112 Cost: Free. Refreshments will be provided. Kelly S. Wylam along with Christopher J. Laing will provide an overview of the funding landscape and discuss the Commonwealth of Pennsylvania's IPART program and how it can help therapeutic, diagnostic and device researchers and companies with SBIR/STTR applications. After the presentations, attendees will have opportunity to meet with the presenters. The Innovation Partnership (IPart) is a consortium of economic development and business assistance organizations located throughout the Commonwealth of Pennsylvania. Questions? Call 215-972-6700 x3223 or email sri@sep.benfranklin.org http://www.sep.benfranklin.org/events/march-5-ipart-sbirsttr-funding-workshop/ 16
  17. 17. Processes Ben Franklin Technology Partners BioAdvance Organized Angel Groups 17
  18. 18. Forums Mid-Atlantic Diamond Ventures (Temple/Fox Innovation & Entrepreneurship Institute) Angel Venture Fair PACT Annual Conference New Jersey Technology Council Annual Conference Funding Post, etc. 18
  19. 19. Networks Philadelphia Alliance for Capital and Technology (PACT) New Jersey Technology Council (NJTC) Mid-Atlantic Venture Association Pennsylvania Bio / Bio New Jersey (annual Biotech conference) Philly Startup Leaders Philly BioBreak Biobreakfast Other Regions – Pittsburgh, Boston, etc. National Association of Seed and Venture Funds (NASVF) 19
  20. 20. Presenters Bernard Rudnick Founder & Managing Partner CapGenic Advisors, LLC brudnick@comcast.net Jeffrey Rosedale, Ph.D. Partner BakerHostetler jrosedale@bakerlaw.com James A. Stuber EVP, NuVue Therapeutics, Inc. Principal, Stuber & Associates jstuber@stuberassoc.com Steve Bowman MITEF Phila. Prog. Co-Chair; Principal, BizClarity steve@bizclarity.com www.mitefphiladelphia.org 20

×