1. “Growth Strategies and Exit Alternatives for MedTech Companies”
Lessons Learned from Successful MedTech Companies
Dr Richard D Gill
Board Member, Launchpad Venture Group
Mass Medic Meeting
September 12th 2008

2. Background What were the obstacles to growing the business(es)?
What growth strategies were pursued and why?
What were the exit alternatives, and what were the key strategic decisions made that resulted in success?

3. Unilever, BTG, Genome Therapeutics, ActiveCyte, AnVil, Sequitur, Signet Laboratories, ProNAi, Launchpad Venture Group

4. Relevant Portfolio Sequitur (sold to Invitrogen)
Oligo & RNAi Services & Technology
Signet Laboratories (sold to Covance)
Oncology & Neurodegenerative Diagnostics
Catalyst Oncology (sold to Diagnocure)
Colon & Breast Cancer Diagnostics
Neuroptix (B Round Financing $17.5M)
Alzheimer’s Disease Diagnostic Device
NABsys (A Round Financing $1M)
Gene Sequencing Device

6. Resources What were the obstacles to growing the business(es)?
Financing
UnderCapitalized – Fund the Froth
Technical
Intellectual Property – Patents, TM, Branding
Regulatory – Third Party FDA Requirements
Expertise
Recruiting – Can Do Teams
Outsourcing – Virtual Development

7. Revenues What growth strategies were pursued and why? Direct Sales OEM
High Salary Costs
OEM
Sharing a Bigger Pie
M&A
Realize value with $$/Stock/Earn Out

8. Liquidity
What were the exit alternatives, and what were the key strategic decisions made that resulted in success?
OEM
Third Party Marketing With a view to M&A
M&A
Provide for Capitalization With Earn Out Provisions
License
Least Capital Intensive

9. It has already happened…
(Outsourcing, that is…)
The large Biotechs have become Pharmas… Amgen, Genentech, Chiron, Biogen-Idec, Genzyme
The Pharmas & Device & Diagnostic Companies are becoming the marketing & distribution Houses
The small Biotechs & Start Ups are the R&D Innovative Shops…
Backed by the Academic Research Faculty…

11. Its all about the IP!
Without patents (intellectual property) you are nowhere
You need the 20 year protection in order to protect the huge investment needed
Originally patents were filed on pharmaceutical & diagnostic uses of chemicals from the paints & dyes industry
Now its biology’s turn with genomics & proteomics

13. Market is Demanding.. Evidence Based Personalized Medicinevs
Block Buster ‘One Size Fits All’
Q? But can Pharma change?
A: Yes - Driven by cost escalation Pharma is changing…
‘A la Unilever Soap Powder/Liquid Detergent’

14. Evidence Based Medicine
Hereditary – Hemophilia – BeneFIX (Wyeth)
Cancer – Her2 +ve (Bayer) = Herceptin (Genentech)
Diabetes – Blood Glucose +/- = Insulin
What next?
Alzheimer’s Diagnostic & Treatment?
Personal Genomic Profile & Prognosis?

15. HealthCare Reform Q? Why did Hilary Clinton fail at HealthCare Reform?
Easy A: Pharma lobby spent $280M+ to destroy the reform
‘Small potatoes’
Harder A: ‘Bill Clinton Walks on Water’
Real A: It was all about Gennifer Flowers

16. Value Proposition For the Future
Knowledge Management & Interpretation of Same…
Horizontal = Dx (Titrate Patients) in order to administer Rx (Effective Therapeutics)
Vertical = Portable Electronic Medical Record & Portable Medical Insurance (Medicare/Medicaid & Socialized Medicine)
‘Brazilian Soldiers’

17. Development Opportunity
‘Drug Rescue’ Repositioning Old Drugs
‘Orphan Drugs’ less than 120,000 patients; R&D tax credits; up to 6 years of monopoly (regardless of IP)
Lifestyle & Insurance Drugs….

18. Life Style & Insurance Drugs
Life Style – Viagra
It will not ever not work for the patient or the partner – bound to make $$$!
Insurance – Lipitor
So you weren’t ill, but you might drop dead if you stop taking it – pay premium for life!

19. New Use Old Drugs
Cardiovascular – side effect hair growth = Rogaine

20. That said… Great way to make a living! You get to make $$$
& see patients successfully treated
‘Just don’t assume its about curing folks - folks!?’
Dr Richard D Gill
ActiveCyte Holdings Bb

21. We all need different medicine

22. Questions?