1. Page 1 Richard Seline, CEO and Principal Border Legislative Conference: San Diego CA A Scenario for Cross Border Innovation & Commercialization The material contained in this document is strictly confidential and the sole property of Global Bioeconomy Consulting LLC. Beyond distribution to specified recipients for appraisal, this document may not be reproduced in whole or in part for any purpose without the express written permission.

2. Page 2 New Economy Strategies – Based in Washington D.C - Has Worked with Global, National and Regional Public and Private Sectors * List not exhaustive – examples only Universidad de Puerto Rico Global National State Government* Regional Global Domestic OtherEntities Academic/NGO Institutions* Tennessee Michigan Iowa Indiana North Dakota Texas Utah Kansas

3. Page 3 New Economy Strategies’ Four Pillars Innovation Industry Capital Workforce Research Product Development Pre-Clinical Testing Clinical Trials Manufacturing & Marketing CRO’s Tool Companies Outsource testing services Contract manufacturing High Schools 4 yr/ Post Bacc CCs/Techs IndustryWIBS Innovation & Entrepreneur -ship Productivity Competitive- ness Rising Standards of Living Supply Demand$25K$100K$2, 000K$5, 000K Funding Gap Secondary Funding Gap

4. Page 4 International Benchmarks and Best Practices Business Cases/Plans Regional Profiles Specific Strengths & Demands Areas of Competitive Advantage Strategy Development Regional Innovation Development Implementation Networks of Science & Innovation Business Concepts Infrastructure Physical Human Resources A Framework for Regional Economic Growth & Vitality

5. Page 5 Why is This Important to You? Urgency and Fear….

6. Page 6 Reality Check #1: “Current Distance Education Programme in IT” IIT Bombay MBT, Mumbai NCST, Mumbai MBT, Pune STES, Pune SGSITS, Indore VNIT, Nagpur MGM, Nanded Goa University Trivandrum

7. Page 7 Reality Check #2: Indian Institute of Technology Bombay Engineering the Future

8. Page 8 Reality Check #3: Super Powers of Knowledge?

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10. Page 10 Business Value Chain is Decoupled: Suggesting unique opportunities for a broader set of US-Mexico regions Research Product Development Testing & Proof of Concept Market Tests Manufacturing & Marketing Contract Research Organizations Tool Companies Outsource testing services Contract manufacturing

11. Page 11 The Hub and Node Concept for Cross- Border Workforce & Economic Development Interests So-called Innovation Centers of Excellence must be coordinating their research, discovery, scientists, and ultimately their commercialization assets (dollars, expertise, management talent, etc.) Make the commitment to Innovation Centers of Excellence as the nodes for Innovation Capacity Building – then to link those Centers across Mexico to promote Innovation Capacity on a Domestic and Global scale, and then connect to US border states and cities. Thus using the diagram to the right, our recommendation is to address collaboration and coordination by Centers of Excellence through Innovation Capacity Building from the grassroots Global Hub Country E Border States Consortia F Region A Program B Region C FUMEC C of E: Academies Within Mexico IMCO Economia Venture Fund FUNSALUD

12. Page 12 Homeland Security Key to Clusters Water Mgmt Bio/Pharma Computer Equip & Programming Energy Pressure Equip Engineering Services SAMPLE US ENGINEERING-RELATED CLUSTER ACTIVITY Aerospace

13. Page 13 Geographic Distribution of Federal Research Facilities

14. Page 14 Where are the assets, the infrastructure and the eco- system best organized for success in Advanced Manufacturing, Life Sciences, Energy

15. Page 15  GBC is a strategy through implementation consulting firm focused on building life sciences and related economies in regions around the world  GBC works with regions to develop and implement practical solutions that generate sustainable growth and enhance global competitiveness  Our international focus and experience provides us with a deep understanding of government policy, development challenges, best principles, and priority actions for different countries around the world  GBC works to ensure that all stakeholders, including government, academia, industry and not-for-profit organizations, are active participants in building local prosperity for their region An introduction to Global Bioeconomy Consulting (GBC)

16. Page 16 GBC is expanding to build regional innovation economies globally Head Office: Washington D.C. Operations Office: Toronto ON Established: April 2005 as a spin-off from New Economy Strategies (NES) Geographic Region: US & Canada Regional Office: Surrey, United Kingdom Established: August 2005 Geographic Region: Europe Regional Office: Mexico City, Mexico Established: January 2006 Geographic Region: Latin America Future Regional Office: Singapore Established: 2 nd Quarter 2006 Geographic Region: Asia

17. Page 17 Leveraging Assets: Economic, Industrial, Societal

18. Page 18  Working with the Council on Competitiveness, GBC assessed Mexico’s national policy environment and three regional clusters around Mexico City, Guadalajara, and Monterrey  The final report and recommendations were presented to the public in Mexico City last month Review of our recent work in Mexico = Additional regions in Mexico with strengths in the life sciences sector = Life sciences cluster = Benchmarked US regions with strengths in the life sciences sector

19. Page 19 We position regions within the innovation lifecycle to drive cluster growth Knowledge Creation Technology Transfer Commercialization Industrialization Patents Licenses Incubation/ Research Parks Venture Capital Business Planning IPOs/Gazelles Job Creation Labor Market/ Graduates M&A Activity Economies of Scale Federal R&D Industry Consortia & Partnerships Regulatory Environment Value-add ConceptionFormation GrowthMaturity Clinical Trials Regulatory Approval Industry R&D Universities & Research Institutions Product Pipeline Proof of Concept Testing Collaborations/ Partnerships

20. Page 20 Review of our findings in Mexico Knowledge Creation Technology Transfer CommercializationIndustrialization Policy Environment Commercial Sector Mexico City Region Monterrey Region Guadalajara Region Existing Partnerships Future Opportunities Legend: Overall Status Limited Emerging Strong National Positioning Regional Positioning Cross Border Positioning Note: Status is based on a qualitative assessment of assets, resources and overall commitment that is found at each stage relative to global standards. Mexico has strengths in knowledge creation and industry, however resources must be focused on improving national innovation policy and facilitating technology commercialization

21. Page 21 Assessment – International Existing PartnershipsFuture Opportunities Several collaborative projects and student exchanges through informal networks Some formal collaborations and programs have already proven successful Opportunity to formalize additional relationships with other institutions on both sides of the border Limited framework for partnership creation and IP sharing Growing capacity for health care services Significant interest to participate if priority projects can be identified Growing capacity for clinical trials Traditionally little assurance of policy stability beyond 6 year election term Few policies address this stage of development Too few growing companies, most have been operating over 40 years With limited small-medium sized companies even fewer graduate to the growth stage Several examples of US companies partnering with Mexico for manufacturing Too few examples of Mexican companies sourcing innovation or market opportunities from the US Companies on both sides interested in opportunities for research partnerships with academia or other commercial partners to develop new innovative products Knowledge Creation Technology Transfer Commercialization Industrialization Legend: Overall Status Limited Emerging Strong Note: Overall status is based on a qualitative assessment of assets, resources and overall commitment that is devoted to each stage relative to global standards.

22. Page 22 Next steps for Mexico GBC is discussing a number of opportunities with stakeholders in Mexico & US Example initiative: Building research strengths to address health and quality of life needs Methodology:  Invest in 3-5 priority areas (e.g. diabetes, obesity, hypertension)  Network research experts, industry leaders, government, and others from across Mexico  Work together on plan with specific health outcomes Potential champions:  Academic institutions  Government programs  Industry groups Example initiative: Facilitate investment and commercialization of technologies Methodology:  Establish program to select innovative technologies  Develop plans in partnership with industry partners  Bring together government investment institutions and private investors to finance Potential champions:  Collaboration with public and private sector forming a Cross- Border Venture Fund A B

23. Page 23 Increasing cross border innovation and partnerships Example initiative: Expanding cross border activity to commercialization Methodology: Creation of a Cross Border Institute for Innovation and Commercialization (CBIC) Recent US Interest:  San Diego: BIOCOMM  Arizona: Arizona State University AZTE  New Mexico: NextGen Cluster Initiative  Texas: Texas Healthcare and Bioscience Institute C Opportunity for US & Mexico: Build on research collaborations in areas of mutual interest and focus on commercialization of novel technologies by linking a Cross Border Innovation and Commercialization Network.

24. Page 24 GBC Aspiration: A Cross Border Community of Innovation Identifying & Measuring Assets and Skills US- Mexico Innovation Capacity Capital Human Resources Science & Innovation Infrastructure Converge, Coordinate, Collaborate 1 Knowledge of Critical Sciences 5 Economic Value Generation 6 Infrastructure and Facilities Driving Design, Manufacturing and Logistics 7 Market Analysis and Access 3 Expertise in capital sourcing Infrastructure, Human Resources, Capital, and Science & Innovation: Inventorying of technology and science assets, in addition to global benchmarking, will allow the Border to determine which strategic assets can be translated into key directions for innovative growth 3 4 5 7 1 2 6 4 Competitive strengths assessment 2 Global Perspective

25. Page 25 Establishing a permanent presence in Mexico GBC is pleased to announce the opening of a permanent office in Mexico City  Louise Batchelder is GBC’s Director for Latin America  Through our office in Mexico we will work at the regional, state and national level to help build the innovation capacity of and specifically the life sciences sector in Mexico  This experience in Mexico will also create longer term opportunities to expand in other Latin and South American countries…as well as link our global relationships in Canada, Europe and Asia.

26. Page 26 Robert Merson, Managing Director 1250 24 th Street, N.W., Suite 300 Washington, D.C. 20037 Tel: (202) 466-0557 Fax: (202) 466-0567 www.bioeconomies.com Louise Batchelder, Director – Latin America Mexico City, Mexico Telephone: (00 52 55) 1473 7988, Email: lbatchel@prodigy.net.mx