Thinking Out-of-the-Box

Global Virtual Collaboratory Tapping Brilliant Minds through the Internet to Solve Complex Scientific Problems Dr. Peter Van Voris President - Van Voris Consulting LLC 23 October 2007

Realization - Dr. Alph Bingham’s Idea A Formulation Chemist for 30 years at Eli Lilly Entered a Chemistry Chat-Room in 2000 to explore ways to manufacture a precursor to a new pharmaceutical Realized the there was incredible scientific power in the web Worked with corporate officers to established a reward to those who could deliver prototype samples

scientists signed up as Solvers Global Virtual Collaboratory www.InnoCentive.com A 2001 spin-off of Eli Lilly has over 130,000 prequalified scientists signed up as Solvers InnoCentive -- a single purpose web site that helps many Fortune 500 companies solve complex chemistry, biology, physics and materials sciences problems. 4

Open Innovation Platform Traditional R&D Resources Federal Laboratories Inter-Agency Agreements Universities Contract labs and Consultants Global Academia Researchers in Russia, India, China, etc. Scientists in other industries Excess capacity in R&D Labs worldwide Retirees VC Start-ups Non-Traditional R&D Resources Global access to world class intellectual capacity

What is out there on the Web?? Yet2.com - deal broker Shared-Insight.com - focused on IT sector TopCoder - focused on writing programming code Gearson Lehrman Group - custom R&D Gates Foundation Grand Challenge - focus topic areas ChemWeb.com - free searchable support for chemists NineSigmas.com - product development support Expert Central - thousands of engineers & scientists providing free support to help answer questions of school aged children Earth Prize- $25M prize for carbon sequestration technology X-Prize - Focused on developing radical technologic breakthroughs InnoCentive.com - innovative company designed to reward those who can solve “challenge” problems for customers

InnoCentive Business Model InnoCentive’s Internet–based Search Platform Solvers 130,000 Seeker Companies

Finding One Mind to Help Internal R&D Staff Army of Solution Providers The Best Solution is to Award a Cash Prize You Only Pay if Someone Provides a Solution

Who is Involved Confidential Confidential Confidential Confidential

Benefits Flexible R&D Capacity R&D Risk Management Diversity Speed Dynamic flexibility to meet ebb & flow of demand More highly skilled resources without fixed cost R&D Risk Management Fund solutions not “science projects” Avoid false negatives Diversity Problem solving approaches and scientific disciplines Access to very specific tools and labs Speed Avoid re-inventing the wheel Marshall more minds

Solver Global Demographics ~130,000 Prequalified Scientists

Global Scientific Partnerships

Science Networks in Russia Russian Academy of Sciences Altay State University Blagoveshchensk State University Buryat State University Chelyabinsk State University Irkutsk State University Ivanovo State Chemistry University Kazan State University Kemerovo State University Krasnoyarsk State University Kurgan State University Mordov State University Moscow State University Nijny Novgorod University Novosibirsk State University Omsk State University Rostov State University Russian University of Chemistry and Technology Saint-Petersburg State University Mendeleev University of Chemical Technology Samara State University Saratov State University Tambov State University Tumen State University Tver State Technical University Tver State University Yaroslavl State University

Science Networks in India Council of Scientific and Industrial Research (India) National Chemistry Labs of India Indian Institute of Chemical Engineers Panjab University In Chandigarh Sponsored the 91st Indian Science Congress held at Panjab University in Chandigarh Sponsored the sixth Chemical Research Society meetings and the India National Symposium at Kanpur Formed and Advisory Board comprising India’s most well-respected scientist and Researchers to enhance global R&D in India

Science Networks in China Chinese Academy of Sciences (CAS) National Natural Science Foundation of China (NFSC) Beijing Normal University Fudan University Huazhong Normal University Lanzhou University Northwest University Peking University Sichuan University Sun Yat-Sen University Xiamen University Zhejiang University

>40 Scientific Disciplines Chemistry Disciplines

>40 Scientific Disciplines Biology Disciplines

Challenge Types Reduction-to-Practice Challenge Theoretical Challenge “Global Think Tank” No lab work required Deliverables: theoretical proposal Cannot validate the solution prior to acceptance Reduction-to-Practice Challenge An “Extended Lab” Requires lab work Deliverables: validated solution (research data and/or sample) Can validate the solution prior to acceptance Award level: $15-$50K Award level: $40-$1M

Developing a Challenge Abstract - one or two sentence description Project or Workroom Detailed Description of the Challenge - full page or more Detailed Project Solution Criteria - very important Any Prior Art and/or attempts that were not fruitful to pursue Known literature and or patents in this area Formats or graphic requirements or plots of information required Lab work that must be submitted to validate approach if a “reduction to practice” Expectations of ownership of IP and freedom to operate

Private Project or Workroom Allows the solver to upload proposed solutions for evaluations Allows the solver to ask questions of seeker Links to other relevant information on the site or other sites Allows the solver to review the terms of their agreement with InnoCentive

Writing Challenges for Success Probability of Success Higher Discrete scientific problems Search for novel ideas Extension of your lab capacity Lower Long-standing industrial problems “Programmatic” challenges Drastically under-priced challenges or those with insufficient deadlines

Average Solution Rate is ~37% Solution Rate Varies Among Different Seeker Clients Average solution rate ~37%

Results to Date Over 500 challenges posted >130,000 solvers (>175 countries) >185 awards to date (many under review/pending) Over $3,100,000 paid to Solvers Global source of solutions: Argentina - Italy - Singapore Canada - Japan - Spain China - Kazakhstan - Sweden Denmark - N.Ireland - Switzerland Egypt - Philippines - Thailand Germany - Poland - UK India - Romania - USA Israel - Russia

Sample Web Site Page

A Snapshot - InnoCentive Website

Answers to Four Typical Questions Award amount is a Paid-up License in exchange for the Technology Meets the fundamental requirements of Inventors being paid for inventions Outsourcing Science to overseas Scientists All Seekers have internalized the solution into products or to further development of an instrument in house Federal employees signing up to as solvers This could happen; however, InnoCentive does “Due Diligence” to verify employment status at the time of the award & who would give up their pension for $25K Seeker Steals Solvers Ideas InnoCentive employs scientists to assist with the development of Challenges and they also prescreen proposals when they are submitted to the Seeker. InnoCentive Business Model protects the interest and equities of both Seekers and Solvers

Example - Pharmaceutical Intermediate 4-(4-Hydroxyphenyl)butyric acid - an early-stage intermediate The current starting material, 4-(4-Methoxyphenyl)butyric acid, is available but moderately expensive ($300/kg). 4-(4-Hydroxyphenyl)butyric acid a viable starting material if an economically competitive route could be developed.

BUTANOIC ACID INNOCENTIVE 3109 R4-(4-HYDROXYPHENYL) BUTANOIC ACID   POSTED: June 26, 2001 DEADLINE: Nov 30, 2001 AWARD: $25,0000 USD Challenge Abstract An efficient synthetic strategy for the following butanoic acid derivative is required. This molecule has been previously reported in the chemical literature but the existing known synthetic route may be lengthy, expensive and/or low yielding. Devise and execute the "best synthetic pathway". H O

Butanoic Acid Challenge AWARDED! INNOCENTIVE 3109 R4-(4-HYDROXYPHENYL) BUTANOIC ACID   POSTED: June 26, 2001 DEADLINE: Nov 30, 2001 AWARD: $25,0000 USD Solution Criteria: 2 steps or fewer >80% overall yield >95% purity 2.0 g white to off-white solid H O

Challenge Dynamics 221 Solvers expressed interest in solving the problem and created project rooms 10 Solvers (representing 7 countries) submitted chemicals for analysis Average time to solve the problem was 45 days

Successful Solution Received Solution Meets Challenge Criteria: 2 steps >80% overall yield >95% purity Delivery of 2.0g white to off-white solid Solver receives $25,000 USD!

Benefits The Seeker Scientist did not have The Seeker paid for success, not efforts or failures The solution was reached in 1/10 of the time The solution was reached at a fraction of the cost of internal resources The Seeker Scientist did not have to look for someone to solve the problem – the solution found the Seeker

Sample Award AWARDED! INNOCENTIVE 258382 PARACRYSTALLINE ARRAYS POSTED: MAY 07, 2002 DEADLINE: JUL 08, 2002 $50,000          Challenge Abstract: Provide a research proposal that outlines a novel research plan to define the pathogenesis and toxicologic significance of paracrystalline arrays in mitochondria in the absence of other ultrastructural alterations. Winning Solver– a protein crystallographer from Russia

Benefits A new screening program resulted in a “puzzling” toxicology: Toxicology experts from 6 different firms cannot make sense of it “Outside” toxicology experts (consultants) cannot solve Decided to post on InnoCentive A protein crystallographer solves it: No background in toxicology – PhD in crystallography Understood the problem based on crystallography principles Solved on the basis of crystallography knowledge – not toxicology

Sample Award 130 Project rooms AWARDED! InnoCentive 2975421 UV Resistance of Coating Containing Metal Ions Posted: August 25, 2005  Deadline: October 30, 2005 Challenge Abstract The Seeker is seeking additives to improve UV resistance of coating containing metal ions. Result 130 Project rooms 17 Submissions 2 Awards

Sample Awards AWARDED! InnoCentive 1225582 Full-Length cDNA Isolation Posted: October 15, 2003   Deadline: November 15, 2003 Challenge Abstract A method to isolate a full-length cDNA based on the 3' EST sequence is needed. Result: 547 Project rooms 6 Submissions 1 Awards

Sample Award 128 Project rooms InnoCentive 4035417 Stable Solid Peroxide(s) to Withstand Extreme Conditions Posted: September 11, 2006 Deadline: November 26, 2006 $25,000 Award • Challenge Abstract Identification of stable solid peroxide(s) that can withstand temperature extremes during long term storage is required. Result 128 Project rooms 7 Submissions 1 Award 44 year old US polymer chemist from Texas with 20 years experience with PVA encapsulation methods, designed a dry storage “Alka-Seltzer” like product that the corporate scientists had never thought about or had proposed to them.

Sample Award Narrow Bandwidth Optical Spectral Filter - $35,000 Posted: February 23, 2007 Deadline: June 9, 2007 • Challenge Abstract - Identified a narrow bandwidth optical spectral filter with high in bandwidth UV transmission & high out-of-band rejection ratio within the Solar Blinds Spot Result - 132 Project Rooms Solver - Retired VP of R&D PerkinElmer -- Ph.D. Atomic/Optical Physicist from University of Wisconsin who now lives in Norwalk Connecticut Retired after 30+ years in Instrument development for PerkinElmer and has 30 US patents. What next? This person is now a consultant to the company who issued the challenge.

“DNA Extraction” 216 Project rooms InnoCentive 5034503 $25,000 Solvent Free Nucleic Acid Extraction Posted: March 14, 2007 Deadline: May 31, 2007 • Challenge Abstract A novel method of extraction and concentration of nucleic acids is needed. Result 216 Project rooms 7 proposed solution No award

“RT Oxidation Catalyst” InnoCentive 5050499 $25,000 RT Oxidation Catalyst Posted: March 22, 2007 Deadline: June 22, 2007 • Challenge Abstract Identify a catalyst or catalyst system that will oxidize pesticidial organic compounds at room temp. Result 120 Project rooms 9 Proposed Solution No Award

peter.vanvoris@att.net 202-550-8500 What does it Cost?? Intellectual Gold Mine Costs: Annual Membership fee: $100,000 Posting fees: $3,500 per Challenge Award amount + 20% to InnoCentive $25,000 award will cost $30,000 Validate or Invalidate concept in your own Laboratories peter.vanvoris@att.net 202-550-8500

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