Technology Transfer from an Investor Perspective. Aarhus University, 23 February 2010 Henrijette Richter

Transcription

1 Technology Transfer from an Investor Perspective Aarhus University, 23 February 2010 Henrijette Richter

2 Why is tech tansfer important to Novo A/S 2. What do we do at Novo Seeds 3. Novo Seeds experience with tech transfer 4. How can we improve

3 Novo A/S Idea Start-up biotech Small-mid size biotech Established biotech Large biotech/ Pharma

4 Novo Seeds deal sources TTOs Biotech start-up Public research groups Founder with IP External network Novo Seeds Biotech Start-up

5 Capital sources consequences of choice TTOs Biotech start-up Public research groups Founder with IP Capital Source: Soft money Investors (Novo Seeds) Pharma, larger Biotech

6 Novo Seeds Established in September 2007 Anchored in Novo A/S as a collaboration between the Novo Nordisk Foundation and Novo A/S Lead by Dr. Søren Carlsen, Managing Partner and a team of two Investment Directors and two professionals Aims to bridge the gap between promising commercially relevant research and life science venture capital A two-component program pre-seed grant capacity seed financing fund

7 Søren Carlsen Managing Partner Novo A/S Novo Ventures Novo Seeds Henrijette Richter Investment Director Novo A/S Novo Seeds Berit Mikkelsen Project Assistant Novo A/S Novo Seeds Bobby Soni Associate Novo A/S Novo Seeds Stephan Christgau Investment Director Novo A/S Novo Seeds PhD molecular biology (KU/Novo Nordisk) Postdoctoral training MIT Center for Cancer Research Joined the venture business in 2004 (Vækstfonden and later Sunstone Capital) Came to Novo A/S 2007 to start up Novo Seeds

8 Distribution of pre-seed and seed dealflow since Q3/07 Deals Q3-Q Q1-Q Q1-Q Q1 seed (153) pre-seed (87)

9 Preseed Drug development targeting a series of orphan diseases known as lysosomal storage diseases (1.9 MDKK. 12 months) Development of safe and broad-spectrum anti fungal antibiotics (1.65 MDKK. 12 months) Enhancing the potency of DNA-vaccinesm (1.9 MDKK. 12 months) Seed New therapies for viral diseases (8 MDKK. 18 months) Development of drugs for the regulation of epigentic mechanisms (13.5 MDKK. 24 months) Development of novel twocomponent drugs targeting Rheumatoid Arthritis (9.5 MDKK. 30 months) Develops novel natural antibiotics against gram-negative bacteria. The pipeline of the company is based on natural small molecules produced by microfungi. (3.7 MDKK. 18 months) Develops novel treatment for intensive care unit patients suffering from thrombocytopenia associated organ failure (1.5 MDKK. 12 months) Aros Pharma is developing novel treatment of visceral pain in Irritable Bowel Syndrome (IBS). The company was established in 2009 and plans to initiate the first clinical study in late 2010 (5.9 MDKK. 12 months)

10 What are we looking for Ideas/products addressing unmet needs Strong patents or patent possibilities Motivated and focused team Modest development time and cost Reliable pre-clinical models exist Market accessibility and competition Test ideas with commercial potential/max return on investment Exit horizon

11 What to Expect from Investors Investor s responds time varies greatly High attrition rate for investors The decision/investment process is long (3-6 months) Unless own money are invested, high ownership share and control is difficult to obtain

12 12 Typical Investment Process Screening First meeting Evaluation Second meeting third, fourth Due diligence Internal board approval Term sheet and negotiation Decision on final deal structure Production of legal documents Signing/Closing of investment..3-6 months later

13 13 The Start-up Biotech Business Plan The business plan should contain: Introduction (max 2 pages) that describes business idea, target indication, operational plan and management Scientific background, state of the art and product opportunity Patent strategy Development plan to next inflection points and beyond, including financial requirements Milestones and deliverables Management (description of team and present and future advisors) Most seed investors are used to start the dialogue before everything is in place!

14 What it takes to start-up biotech Multi-skilled, enthusiastic founder Engaged TTO Network, network, network. Culture of entrepreneurship Clear rights to IP Investors with both cash and competences

15 Our experience of the TT process Misalignment of expectations Communication unstructured Lack of support to founders/scientists Different time lines Lack of resources Lack of flexibility Not enough knowledge of each others reasons to be

16 Our experience of the TT process (2) Advisors, Consultants, entrepreneurs, other network External public collaborators Biotech start-up TTO Public research (Uni) Investors Soft money Pharma, larger Biotech

17 How to improve biotech start-up (1) Internal efforts: Expectation management/alignment Organize/structure communication flow Bring in network earlier (consultants, serial entrepreneurs, etc.) Be open for a longer and not necessary linear process Be flexible and adaptable to terms no standard is given Add people with business experience to the TTO groups Assist founders View investors as a customer in line with Pharma/large Biotech

18 How to improve biotech start-up (2) External efforts: Reward starting-up companies at/from universities Increase resources to TTOs (enabling in-house people with business experience) Nurse entrepreneurship Acknowledge and communicate the requirement for biotech Participate and engage

19 Possible future start-up environment TTOs Biotech start-up Public research groups Founder with IP External network (consultants, entrepreneurs, etc.) Soft money Investors (Novo Seeds) Pharma, larger Biotech

20 Krogshøjvej 41 DK-2880 Bagsværd P: F: E: Henrijette Richter P: E:

21 21 November 25, 2009 How to make the startup company survive Be flexible and adaptable to external and internal changes Pursue opportunities opportunistically Maintain a good dialogue with investors and other stakeholders Cash is king. Spend money wisely pursue only value creating opportunities

22 Since Q3/2007 Novo Seeds has evaluated more than 200 deals Deals 120 Denmark (129) Sweden (44) Norway (18) Outsiden Scandinavia (49) Q3-Q Q1-Q Q1-Q Q1

23 23 November 25, 2009 Before Contacting the Investors Set a project team with relevant competencies Network! Estimate development time and budget Prepare project description (or Business Plan) Identify and select key papers that supports the invention Make an overview of your patent possibilities and Freedom to Operate Focus Get an overview of the regulatory requirements Map your investors Know your competitors (groups and/or companies) Market size

24 Multiple reasons for declining an opportunity Science: too early, difficult target(s), Outside investment scope: not compatible with NS positive-list, geography Valuation: not profitable Management: unexperienced, re-organisation Market potential: questinable market potential Other: public company, missing/weak business plan IPR: weak IP position, questionable IP, to short IPR Terms: public company, outside NS financial operating area, noncompatible terms

25 Overview of Novo Seeds commitments Three years ( ) 100 MDKK was allocated to Seeds activities. As of today. ~7 MDKK has been given as pre-seed grants Cytoguide 1.5 MDKK (Oct 2007) InVacc 1.9 MDKK (0.3 MDKK in Apr 2008 and 1.6 MDKK in Oct 2008) Pcovery 1.65 MDKK (May 2009) Orphazyme 1.9 MDKK (May 2009) ~ 50 MDKK has been invested in seed-companies MycoTeQ total 3.7 MDKK (Dec 2007) EpiTherapeutics total 13.5 MDKK Cytoguide total 9.5 MDKK (Apr 2008) Inagen total 8 MDKK (Aug 2008) Thrombologics total 1.5 MDKK (Dec 2009) Aros Pharma total 5.0 MDKK (Dec 2009) Two new seed investments in progress total 7 MDKK (Q1/2010)

26 Distribution of decline reasons between deals evaluated by Novo Seeds 2007/Q3 - Declined opportunities 2009/Q3 (excl. international and active deals) % of total/category Sweden Norway Denmark Finland iceland 10 0 science outside investment scope valuation management market potential other IPR terms