Presentation on theme: "Healthcare Innovation & Commercialization October 8th 2014"— Presentation transcript:
1Healthcare Innovation & Commercialization October 8th 2014 Getting a Company off the Ground
2My Story… Currently CEO of SevenOaks Biosystems previously.. Co-Founded with Dr Rox Anderson (MGH/HMS)previously..Immunology undergrad, life sciences investment banker ( )Harvard-MIT Biomedical Enterprise Program ( )Started MoMelan Technologies with Dr Rox Anderson (Professor of Dermatology, HMS) in June 2009Raised $5m in Venture Capital, acquired in Nov 2012MoMelan - 1st Venture-backed companyNovel enabling medical device technology for automated epidermal expansion and transplant1 full-time employee, 1 Rockstar scientific founder, 4 board-members, 4 inactive founders, 5 consultants
3General points about start-ups & people When starting out, keep it leanBusiness vs Science ProjectCapital efficiency is keyImpact on fundraisingCompanies are continuously evolving at the beginning
4Starting a company – key stakeholders ‘Working’ ScientistsEntrepreneur‘Rockstar’ scientistStakeholder can be one, or more of eachDifferent motivations and desired outcomesAdvisors
5Motivation - Points to consider Assess risk profiles and weigh against contributionsRockstar scientist is probably going to bring in the $$The ‘Entrepreneur’ (could be MBA, post-doc leaving to join company, etc) bears significant riskScientists remaining in their job – less risk but should be compensated for job well-doneAdvisors – low risk profile but can be critical to successStock is your primary currencyUtilize vestingHow to break up the pie…Without
6People, Evolution & Hiring Companies evolve quickly…Sometimes month to month - Rapidly changingFor Example…First 12 monthsEarly science‘Rangefinding work’Next 12 MonthsCritical path scienceCompany-buildingBe mindful of personalitiesPassionNegotiate in good faith – be honest about aims and expectationsUse ConsultantsHire – internalize talent
7People, Evolution & Firing Obvious reasons to fire someoneFraudAssaultCorporate espionageLess obvious reasons to fire someoneCompanys needs changeNot as good as you thought they wereConsultants with expectationsYou are attracting higher-quality talentBe honest, set aims and expectations, and don’t sugar coat bad news
8Back to breaking up the pie Deciding how to break-up equity can lead to..
9Class Exercise Break up into groups of 5 Quickly choose a ‘company name’Allocate roles1 rockstar scientist1 Entrepreneur type3 post-doc types1 is leaving to join the company2 are staying
10Class Exercise Scenario Your Rockstar scientist has invented a new medical device3 of his post-docs have been working on this technology for 2 years as part of their job1 post-doc is leaving to head the scientific effort at the company, the other two are remaining in the labYour Rockstar has found an ‘MBA type’ to spearhead the business effort10 Minutes to decide how much each person gets!
11MoMelan TechnologiesThe CompanyMoMelan Technologies developed EpigraftTM (now called CellutomeTM)Technology invented at the Wellman Center for Medicine, MGH, licensed from Partners HealthcareScientific Founder is R.Rox Anderson, MD – Professor of Dermatology, Harvard Medical SchoolSameer Sabir – Co-Founder (& Student of Prof. Anderson)designed to make epidermal skin grafting minimally invasive, simple and automatedStarted the company with a concept, raised 2 rounds of investment capital, developed a commercial product, ran some clinical trials, cleared the FDA and sold the company….all in 2.5 years
122012 2011 2010 2009 Timeline File with FDA – September ACQUIRED by KCI, Inc - November2010Series A Financing 0f $3.6m – JuneFirst patient treated – NovemberAwarded $750k MA state award2009Could have all the years visible at the outset and only have the bullets dissolve on. – RDTry that as alternative for consideration.That’s basically RDFirst financing of $1.1m – MarchFirst prototype complete – OctoberCo-Founded MoMelan with Prof Rox Anderson - Sept
14MoMelan Technologies - Overview The CompanyMoMelan Technologies is developing EpigraftTMunique medical device platform that enables optimized mechanical autologous epidermal transplantdesigned to make epidermal skin grafting minimally invasive, simple and automatedPoint of care, few meaningful competitive approaches$1.1m Seed round in February 2010$750k Massachusetts AwardSimple & Rapid Regulatory PathwayFDA 510k class 1 – exempt from pre- market notificationThe opportunityLarge potential market applications for unmet needsWound-Healing, including complicated wounds ($3bn)Synergies with existing wound- dressings, NPWTDermatology, including Medical ($500m) and Aesthetic ($820m)Attractive economic dynamics85%+ projected gross marginsReimbursementPatient pay or existing reimbursement, depending on applicationOffice or outpatient procedure<1 hour procedure time in total
15Vice President of Market Development The Momelan TeamManagementSameer A SabirChief Executive Officer10 years experience in life sciencesJPMorgan, Commerzbank Securities,Cinnabar ConsultingRobert LaRocheVice President of Market Development26 years experience in medical device sales and marketingCR Bard, Cambridge Heart, CandelaAndrew ZieglerLead Engineer25 years experience in mechanical engineering design and prototypingDesign Continuum, iRobotJeff CerierProject Manager30 years experience in device project managementCo-Founder, TDCBoard of DirectorsReview blurbsRobert Forrester(Chairman) – COO, VerastemSameer A SabirChief Executive Officer, MoMelan TechnologiesSridhar PrathikantiMember, Life Science AngelsJosh TolkoffManaging Director, Ironwood EquityBill McCullenGeneral Partner, Launch Capital
16The Momelan Team – Scientific Advisory Board Professor Rox Anderson, MDProfessor of Dermatology, Harvard Medical SchoolDirector, Wellman Center for PhotomedicineMassachusetts General HospitalBoston, MARoy Geronemus MDDirector, Laser & Skin Surgery Center of New YorkClinical Professor of DermatologyNew York University Medical CenterNew York, NY Rebat Halder MDProfessor and ChairmanDepartment of DermatologyHoward University College of MedicineWashington, D.C. David Armstrong DPM, MD, PhDProfessor of Surgery and DirectorSouthern Arizona Limb Salvage Alliance (SALSA)University of Arizona College of MedicineTucson, AZThomas Serena MD, FACSCo-Founder & CEO, Serena GroupVice-President, American College for Hyperbaric Medicine
17Meeting a Significant Need ProblemInnovationSolutionEpidermal skin grafting is effective for many skin disorders, but is rarely utilized-imprecise-inefficient-invasiveMoMelan’s automated device can precisely and reproducibly generate an optimized epidermal skin graftA fast, minimally invasive, cost-effective solution for repigmentation & wound healingEnabling epidermal skin graftingMinimally InvasiveRepeatable & ReliableBiomechanically Precise
19Large US Market Opportunities Medical Dermatology ($500 million)Vitiligo (3-6m pts)Skin cancer wound repair (800k cases/yr)Aesthetic Dermatology ($820 million)Post Laser Treatment Hypopigmentation (500k cases/yr)Scar Revision – Including hypopigmented scars (1.6 M cosmetic surgeries/yr)Wound Care ($2-3 billion)Diabetic foot and venous leg ulcers (3.4m cases/yr)Pressure sores (1.9m/yr)Burns & Trauma (600k cases/yr)Perfect as is
20Low Regulatory Hurdle – Class 1 FDA Device ProductConceptPrototypeClinical TestingNotificationPathAutologous tissuePurely MechanicalNo Chemicals, Biologics, Enzymes“Non-Significant Risk” Designation by multiple IRBs for case studiesNo IDE from the FDA RequiredConclusion is That Device is FDA Class 1Predicate: Electric Skin-Graft MesherNeeds Only General Quality Controls, Not Marketing Release by FDAMoMelan does not need FDA 510K Concurrence before selling a Class 1 Device
21Financial Incentive to Adopt EpiGraftTM System Differentiated disposables will separate self-pay/out of pocket marketsPatient InsuredFor acute and chronic woundsExisting epidermal grafting CPT codesFacility fee where applicablePatient Pay Out of PocketFor aesthetic applicationsVitiligo, hypopigmentation, scar revisionPatients willing to pay to look betterPhysicianGross ProfitEpiGraft Disposable PriceIn OfficeEpiGraft Disposable PricePhysicianGross ProfitEpiGraft Disposable PricePhysician Fee/Gross ProfitIn Facility$145$200Facility FeeGross Profit
22Intellectual Property Exclusive Worldwide License to MGH IP & 9 additional ‘MoMelan’ patent applicationsDevice Patents4 Patent ApplicationsProtects key features of EpiGraft DeviceMethod Patents4 Patent ApplicationsProtects key processes encompassed in EpiGraft ApproachBARRIER TO ENTRYBroad series of 10 commercially relevant patent applicationsDesign1 Patent ApplicationsProtects key design features including interface between control unit and disposableManufacturing Patents1 Patent ApplicationProtects key disposable production process
23Class Exercise Break up into groups of 5 Quickly choose a ‘company name’Allocate roles1 rockstar scientist1 Entrepreneur type3 post-doc types1 is leaving to join the company2 are staying
24Class Exercise Scenario Your Rockstar scientist has invented a new medical device3 of his post-docs have been working on this technology for 2 years as part of their job1 post-doc is leaving to head the scientific effort at the company, the other two are remaining in the labYour Rockstar has found an ‘MBA type’ to spearhead the business effort10 Minutes to decide how much each person gets!
25Find your niche, find what you are good at, and focus on that Find your niche, find what you are good at, and focus on that. And be a good person along the way - if you try to take shortcuts it will just come back and haunt you…Thomas FlohrAviation Entrepreneur