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Kenneth L. Bost Kenneth J. Piller UNC-Charlotte & SoyMeds, Inc. 1 Bost KL, Piller KJ. Protein Expression Systems: Why Soybean Seeds? In: Sudaric A,

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Presentation on theme: "Kenneth L. Bost Kenneth J. Piller UNC-Charlotte & SoyMeds, Inc. 1 Bost KL, Piller KJ. Protein Expression Systems: Why Soybean Seeds? In: Sudaric A,"— Presentation transcript:

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3 Kenneth L. Bost Kenneth J. Piller UNC-Charlotte & SoyMeds, Inc. 1 Bost KL, Piller KJ. Protein Expression Systems: Why Soybean Seeds? In: Sudaric A, ed. Soybean-Molecular Aspects of Breeding: InTech; 2011, pp

4 Splice genes into soybean host DNA Regenerate transgenic soybean plants which express proteins Synthesize genes to express proteins Harvest transgenic seeds containing proteins Formulate seeds into therapies or purify the protein Expressing Proteins in Transgenic Soybean Seeds

5 Wurm, Nat. Biotech. 22:1394, 2004

6 Gene transfer Select T 0 lines Minimum 18 months T 1 seeds Screen T 1 lines Harvest Screen & Harvest T 2 lines Harvest T 3 seeds

7 40 % protein in each seed Millions of doses per greenhouse acre (containment, cost) No cold chain with long term storage capability Purification of protein not necessarily required (safety) Ease of purification from seeds when required (cost, speed) Separation of production & purification in manufacturing Oral delivery (safety, needleless) Cost (less than cents per dose)

8 Large proteins difficult to express (e.g. Thyroglobulin) Proteins needed in large quantity to be effective (e.g. tolerogens) Proteins coming off patent (e.g. erythropoietin) Proteins rarely needed (e.g. bioterrorism vaccines) Proteins used in routine diagnostic assays Proteins which are currently being isolated from tissues Proteins for use in third world (e.g. no cold chain) Cheap proteins for agricultural or environmental use

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10 The Process is the Product !

11 WHAT? WHY? WHO? WHEN? WHERE? HOW?

12 Amgen Values “First, Be Science Based: Our success depends on superior scientific innovation, integrity, and continuous improvement in all aspects of business through the application of the scientific method.” Binder, Science Lessons, 2008

13 “Businessmen and financiers will tell you the correct answer is: To Make Money……..” “The challenge arises when you realize that one of those tangents is worth pursuing for a longer, straighter direction than the others, and you realize that your university, medical center, or foundation can only take you so far……” “In the world of biotechnology entrepreneurship, you have got to be able to convince yourself and others that there is a pot of gold at the end of this particular rainbow.” Biotechnology Entrepreneurship by Michael Salgaller, Logos Press, 2010

14 Splice genes into soybean host DNA Regenerate transgenic soybean plants which express proteins Synthesize genes to express proteins Harvest transgenic seeds containing proteins Formulate seeds into therapies or purify the protein Expressing Proteins in Transgenic Soybean Seeds Why did we start SoyMeds ?

15 Stay at present position  part-time with company Go full time in company  CEO, CSO, etc. License technology to another company  Serve on Board of Directors  Serve on Board of Scientific Advisors  Consultant

16 When you had your great idea, where were you employed? Ownership often lies with your employer, including universities and companies. So…if have an idea for starting a biotech company, you may already have a partner. owns my brain !!!

17 Splice genes into soybean host DNA Regenerate transgenic soybean plants which express proteins Synthesize genes to express proteins Harvest transgenic seeds containing proteins Formulate seeds into therapies or purify the protein Expressing Proteins in Transgenic Soybean Seeds Conflict of Interest: UNCC & SoyMeds ?

18 “Scientists have a reputation for failing to appreciate the difference between a science, a technology, a product, and a company...” “To be true entrepreneurs, scientists must learn to put business ahead of science when developing a commercialization strategy.” Kolchinsky, The Entrepreneur’s Guide to a Biotech Startup

19 Do you have what it takes? Management? Who will be your first employee? Incorporating the company Issue Stock? Agreements? Board of Directors

20 Confidence Perseverance Able to wear multiple hats Stand tall in the face of criticism, yet be humble Decisiveness Able to advertise yourself and product Be able to leave your “comfort zone”; Adaptability Be able to manage risk at many levels Be a problem solver and negotiator at many levels Good Communication skills (Listening skills) Evaluate the advice you receive

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22 Splice genes into soybean host DNA Regenerate transgenic soybean plants which express proteins Synthesize genes to express proteins Harvest transgenic seeds containing proteins Formulate seeds into therapies or purify the protein Expressing Proteins in Transgenic Soybean Seeds Do the “two Kens” have what it takes to be entrepreneurs?

23 Self-tests for being an Entrepreneur

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25 CEO: Chief Executive Officer  Final authority; reports to board COO: Chief Operating Officer  Operations CFO: Chief Financial Officer  Finance CMO: Chief Marketing Officer  Marketing, Sales, Business Development CTO: Chief Technical Officer  Often in engineering Chief Scientific Officer  Often in biotech

26 Must haves:  CEO or COO  to head company  CSO or CTO  to direct science or technology  Board of Directors Necessary haves:  Financial or Business person  part-time or full time (CFO)  Scientific Advisory Board  (at some point) Nobel, Teaching a Lean Start-up, 2010

27 Corporate Law  Business law practice specializing in start-up biotech, taxes Patent Law  Intellectual property (IP), patent filings, patent litigation Securities Law  Raising capital, complying with security laws Regulatory Law  e.g. FDA-knowledgeable attorney

28 Government Specialist  Government does accounting in their own way Angel, VC Specialist  May be suggested by your investors

29 Splice genes into soybean host DNA Regenerate transgenic soybean plants which express proteins Synthesize genes to express proteins Harvest transgenic seeds containing proteins Formulate seeds into therapies or purify the protein Expressing Proteins in Transgenic Soybean Seeds SoyMeds Corporate Structure ?

30 C-Corporation (C-corp)  Most biotech’s will end up this way because VC funding will require it, but don’t necessarily need to start this way  Exit strategies require C-corp  Taxed on profits and taxed on dividends S-Corporation (S-corp)  No income tax at the entity level Limited Liability Corporation (LLC)  No income tax at the entity level

31 Issue stock immediately  Common stock, Preferred stock, Founders stock, etc. Agreements  Founder’s agreement  Non-disclosure agreement  Invention assignment agreement  Non-compete agreement  Employment agreement  Directors & Officers Insurance Establish a Board of Directors Set up a Scientific Advisory Board (at some point) Set up a Clinical Advisory Board (at some point)

32 Do you have what it takes? Management? Who will be your first employee? Incorporating the company Issue Stock? Agreements? Board of Directors Congratulations!! You have a “Virtual Company!!”

33 "How do you become a REAL company?" Our first meeting will come to order! Do I hear a motion to increase our salaries?

34 1) What do you have to sell? What is the product? 2) Is there IP protection? (Freedom to Operate) 3) Is there a market? 4) Is there a Business Model for generating profit? 5) Does management have the skills to implement the business plan? 6) How to finance?

35 Pharmaceuticals  Small molecule drugs  Biologics  Gene Therapy Diagnostics  Analyte Specific Reagents  Kits, Assays, & Tests Devices & Instruments Bioinformatics  Genomics & Proteomics  Personalized Medicine Laboratory Services

36 Splice genes into soybean host DNA Regenerate transgenic soybean plants which express proteins Synthesize genes to express proteins Harvest transgenic seeds containing proteins Formulate seeds into therapies or purify the protein Expressing Proteins in Transgenic Soybean Seeds What does SoyMeds have to sell ?

37 Patents  20 years from date of filing Trade Secrets  known by only certain individuals Trademarks  Identifies and distinguishes the product of one party from another

38 Novelty  New  Not previously disclosed  No prior art Non-obviousness  Not obvious to someone skilled in the art Utility  Has some useful purpose Enablement  Some proof that it works

39 Corporate Law  Business law practice specializing in start-up biotech, taxes Patent Law  Intellectual property (IP), patent filings, patent litigation Securities Law  Raising capital, complying with security laws Regulatory Law  e.g. FDA-knowledgeable attorney

40 Are there prior patents which describe (mention) part of your invention? Are their publications that describe part of your invention? Did you disclose any aspect of your invention in a manuscript, grant application, talk, poster session, etc. before filing your patent application?

41 Regular (Non-provisional)  Submission of all required information supporting the novelty, etc.  First office action: non-final rejection of the patent Provisional  Remains pending for 12 months, then regular patent must be filed  Protection one year earlier; 20 years starts with regular patent filing  Have 12 more months to provide additional data  Cheaper to file than regular patent International  Protection of product outside home country filing  Patent Cooperation Treaty (PCT) filing, then file with individual countries

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43 Patent Searches: A good place to start Search Issued Patents Search Patent Applications Websites: USPTO patent search Google patent search Free Patents Online

44 2) Is there IP (Intellectual Property) protection?

45 Non-obviousness  cannot be a logical extension of others’ work that someone “skilled in the art” would deem obvious. Enablement  some proof that it works  data  precisely described method  prototype

46 When you had your great idea, where were you employed? Ownership often lies with your employer, including universities and companies. So…if have an idea for starting a biotech company, you may already have a partner. owns my brain !!!

47 Freedom to operate (FTO) opinion costs can be quite high ($$$ tens of thousands ) In addition to Patents, such an analysis demonstrates there are no unforeseen risks or prior art. Are you willing to defend your patents?

48 Novelty Non-obviousness Utility Enablement “New Patenting Rules”  America Invents Act 2011  “First to File” versus “First to Invent”  Method for determining priority of patent apps

49 Splice genes into soybean host DNA Regenerate transgenic soybean plants which express proteins Synthesize genes to express proteins Harvest transgenic seeds containing proteins Formulate seeds into therapies or purify the protein Expressing Proteins in Transgenic Soybean Seeds SoyMeds patenting experiences !

50 QUESTIONS ? BREAK!

51 What do real customers want? Total annual sales for a market, factoring in:  Competition Market Share  Price of product  Comparables  Sales force  Growth rate of market  Switching frequency (customer loyalty)

52 Matching business with product & company Market Demand  Market pull vs push Management Leadership Scientific Team Estimation of Risks Regulatory hurdles

53 Fully Integrated Pharmaceutical Company  We do it all. R&D to product positioning & Marketing  e.g. bio-based drugs Drug Repositioning Model  e.g. moving a “shelved” drug forward Molecular Testing Model with Platform Instruments  e.g. Diagnostics Virtual Company (outsource almost everything)  Limit what is done in house & farm everything else out Contract Services  Perform tasks on a fee-for-service basis

54 THERAPEUTIC Research & Development In vitro Testing Lead/Process optimization Pre-clinical testing  (animals) Clinical Testing  (Phase I,II,III) Regulatory review Scale-up Manufacturing Marketing & Growth DIAGNOSTICS/DEVICE Research & Development Proof of concept Prototype Development Clinical Validation Regulatory Review Scale-up Manufacturing Marketing & Growth years years

55 Phase IVPhase IIIPhase IIbPhase IIa Clinical Trials Phase 1 Pre- clinical Phase Candidate Profiling Phase Discovery Phase Drug Development Timeline Life Cycle Management Full Development Early Development Research Candidate Selection Point CSP sPoC DDP FDP 3CPSDP Selected for Proof of Concept Development Decision Point Full Development Point Phase III Checkpoint Submission Decision Point IND – Investigational New Drug NDA – New Drug Application years

56 In Vitro Diagnostic (IVD) Development Timeline 7% Annual Growth years

57 Splice genes into soybean host DNA Regenerate transgenic soybean plants which express proteins Synthesize genes to express proteins Harvest transgenic seeds containing proteins Formulate seeds into therapies or purify the protein Expressing Proteins in Transgenic Soybean Seeds SoyMeds Business Models: Diagnostics & Therapeutics

58 Market Demand, Positioning, Barriers to Entry Management Leadership, Capability, Past Success Technology Robustness, Applicability, Scientific Team Regulatory Hurdles Financial Sustainability

59 What is the proof of market demand? Is the marketing strategy sound and/or optimal? Will size of market sustain product commercialization? Who are competitors? Moving toward or away? How much of the market will be captured? What is the planned distribution channel?

60 Does the structure of the Leadership team fit the Business Model? Does the Board of Directors support the needs of the Business Model? Will the Scientific Advisory Board contribute to the goals of the Business Model?

61 How innovative is the technology? What do others in the field have to say? Does the company have top scientific leaders? Acceptance of the technology? Papers? Grants? Intellectual property? Freedom to operate opinion? What are the potential products? Core technologies?

62 Can the team define the time for regulatory approval? What are the risks for this type of product? Has the company had direct contact with agency? Are regulations for this type of product laid out? Are there undefined impending regulations? Does the company have expertise & a regulatory strategy?

63 Mission Statement Opportunity: Can you succeed? The Technology Business Model Competition? Intellectual Property Exit Strategies Company people Financials (revenue, etc.) Executive summary  (you have two pages!)

64 Market Demand, Positioning, Barriers to Entry Management Leadership, Capability, Past Success Technology Robustness, Applicability, Scientific Team Regulatory Hurdles Financial Sustainability

65 Is CEO experienced? How seasoned is the team? Who has previous experience? Are there gaps in the management team? Can the management team execute the business plan?

66 Splice genes into soybean host DNA Regenerate transgenic soybean plants which express proteins Synthesize genes to express proteins Harvest transgenic seeds containing proteins Formulate seeds into therapies or purify the protein Expressing Proteins in Transgenic Soybean Seeds SoyMeds Management Evaulation

67 Getting Started Money  Incorporation, etc. Money for R&D  Burn rate?  Employees? Money for administration, record keeping, software, etc. Attorney Fees  Patent, Corporate, etc. Boards (B of D, SAB) Regulatory Agencies Travel

68 Dumb Money  Founders, Family, Friends, (Fool’s) Smart Money (dilutive capital)  Individual Angels or Angel Funds  Seed Stage Venture Capitalists (VCs), Full VCs, or VC Groups  Private Equity (e.g. Banks)  Public Equity (e.g. Initial Public Offering, IPO)  Partnerships Smart Money (Non-dilutive capital)  SBIR or STTR grants  Not for Profit Foundations (e.g. Gates, Cystic Fibrosis Fnd)  State Funding or Matching

69 Founder Financing  Investing your own money in your company does not necessarily mean much to future investors  However, it might be necessary for you to put a little money upfront to form the company, get the corporate documents, etc.  “Never take F3 monies that you cannot afford to lose.”

70 High net worth individuals or groups of these persons Early stage investments  R&D  Feasibility, Prototype  Preclinical (animal studies) $25,000 to $5,000,000 Want a percentage of the company, though not as much as VCs How do you find Angels? Networking!!

71 Government grants State Grants  e.g. NCBC Not-For-Profit Grants  Gates, WHO, NMSS, etc. Non-dilutive capital Early stage funding  R&D  Feasibility, Prototype  Preclinical (animal studies) $50,000 to $1,500,000

72 SMALL BUSINESS INNOVATION RESEARCH (SBIR) PROGRAM (R43 & R44) 2.5% set aside Allows partners: up to 33% Phase I & 50% Phase II PI must have >50% employment with company SMALL BUSINESS TECHNOLOGY TRANSFER (STTR) PROGRAM (R41 & R42) 0.3% set aside Requires University partner: at least 30% PI can be employed by partner or small business

73 DOD SBIR/STTR$1.31 HHS SBIR/STTR$0.72 NASA SBIR/STTR$0.14 DOE SBIR/STTR$0.16 NSF SBIR/STTR$0.12 DHS SBIR $0.02 USDA SBIR$0.02 DOC SBIR$0.01 ED SBIR$0.01 EPA SBIR$0.01 DOT SBIR$0.01 TOTAL (2009) $2.4 Billion

74 Phase I SBIR/STTR Phase II SBIR/STTR (Phase IIB) Commercialization Mt. “FDA” ??????? Funding a Biotech Start-up Smart Money: SBIR and STTR grants $100,000- $300, years $300,000 – $1,500, years Valley of Death

75 Splice genes into soybean host DNA Regenerate transgenic soybean plants which express proteins Synthesize genes to express proteins Harvest transgenic seeds containing proteins Formulate seeds into therapies or purify the protein Expressing Proteins in Transgenic Soybean Seeds SoyMeds Company Financing

76 R41-R42 and R43-R44  Standard STTR and SBIR grants New Funding Mechanisms  RC3 (RFA-OD )  SBIRs masquerading as RO1s (RFA AI )  Collaborations between USDA & NIH (PAR )  X01 (PAR ) NIH Translational Res. Ctr. (NCATS)

77 Investment on behalf of others; Managed Later staged investments  Clinical Trials (Phase I, II, III)  Take to Market  Finalize manufacturing Want 1) a percentage of the company, usually significant; 2) to be involved VCs should be a partner How do you find VCs? Networking!!

78 Difficult to distinguish from VC and VC funds Investment on behalf of others; Managed Later staged investments Want 1) a percentage of the company, usually significant; 2) to be involved Should be a partner

79 What is the potential for continued funding? Is business a good candidate for VC funding? What is the exit strategy for the company?  Public offering (IPO)  Merger or Acquisition How much cash on hand and how long will it last? (burn rate) Who has invested (Angel, VC, Founders, etc.)? What is total amount of money needed to reach the market?

80 WHAT? WHY? WHO? WHEN? WHERE? HOW?

81 Do you have what it takes? Management? Who will be your first employee? Incorporating the company Issue Stock? Agreements? Board of Directors Congratulations!! You have a “Virtual Company!!”

82 1) What do you have to sell? What is the product? 2) Is there IP protection? (Freedom to Operate) 3) Is there a market? 4) Is there a Business Model for generating profit? 5) Does management have the skills to implement the business plan? 6) How to finance?

83 “A goal without a plan is a wish” “The goal is achievable, but without planning and preparation, it might never be realized. One of your first goals is to learn more about the business of biotechnology entrepreneurship.” Biotechnology Entrepreneurship, Michael Salgaller, 2010, Logos Press.

84 Resources: The Business of Bioscience, Craig Shimasaki, Springer, 2009 ISBN: Biotechnology Entrepreneurship, Michael Salgaller, Logos Press, 2010 ISBN: Science Lessons, Gordon Binder, Harvard Business Press, 2008 ISBN:

85 QUESTIONS ?


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