Operational Issues to Get Your Company Up and Running

Opera&onal Issues to Get Your Company Up and Running

Where do you start a;er you have the idea

January 21, 2014

#TCNlive 1

Download slides: bit.ly/tcnLifeSci2014

The Panel

•  Moderator: – Mirena Bagur, CONTeXO

•  Panelists: •  Corey McCann, consultant/VC/entrepreneur, MPM Capital •  Bret Siarkowski, CEO of Biofficient Inc.

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Top Line

•  Funding •  Plan: Product/Strategy/Market

•  Team

•  Planning/Milestones

•  Important To-‐Do’s

•  Addendum

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Funding

•  Funding strategy: –  Funding to what milestone and amount needed –  Runway –  Key value inflec&ons along the way – How much to exit or break-‐even

•  Subsequent rounds •  5 year budget

•  Stage of Development –  Target firms – sector; stage; round size; total capital requirements; exper&se •  Know where they are in their fund

•  Talk to Strategic Partners early – develop rela&onship (Cau&on)

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Deal Size, Funding Sources and the Company Lifecycle

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Deal Size

FF

Commercial Rollout

1.0 Beta Alpha Lifecycle Stages

2.0, expansion

Idea

Angels

Early VCs

VCs

PE; II

Source: CONTeXO Group, Spring 2011 #TCNlive

Business Plan Overview

•  Describe the business – Therapeu&c, diagnos&c, device, IT – Prepare business plan / presenta&on • Will we develop ourselves or with a partner (outsource) • What does the market look like •  Current and historical regulatory landscape • What are the barriers to entry • What are the comparables that show our model will work • What is the financing necessary to get to exit • What is the exit


Team

•  You cannot do it alone: Lose “I” from vocabulary –  Get the right people on the bus – define roles and responsibili&es •  Core competency, can they handle uncertainty, flexibility, perseverance, same vision and alignment

–  Experience (complementary) for founding team, KOLs and advisors

•  Consider Virtual Model where possible –  Allows flexibility to hire the best and most experienced for a variable cost

–  Sets an appropriate pace for growth •  Key ques&on about choosing team members: –  Personality fit: Do you like them?


The Team

“The right team” (2-‐4 people) – Strong technical founder •  More than just an idea person •  Has to understand the whole thrust behind the technology and the industry dynamic around it.

– A sales-‐oriented entrepreneur •  Drives the other parts of the business and sells the vision to investors and other stakeholders –  Full &me employees (FTEs) –  Partners –  Poten&al customers


Planning

•  Regulatory •  Planning Considera&ons •  Budget -‐ &ed to milestones/inflec&on points

•  Addi&onal to-‐do items

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Regulatory

•  Major Factor in Success and Funding •  Credible exper&se – Avoid landmines

– Know the challenges •  Define risk mi&ga&on strategy

•  Iden&fy Path: – Therapeu&c, device, diagnos&c, IT •  IND, PMA, 510(k)


Planning Considera&ons Sector Device

(drug delivery, implanted, valves, monitoring; etc)

DiagnosGc TherapeuGc (drugs, vaccines, biologics) Some drug delivery

Healthcare IT / Services

IP Yes -‐ FTO YES Patent Life Important 10 years to develop Countries

Know How Design / Method

Regulatory PMA/510K Companion? 510K/PMA; CLIA

IND HIPAA Stark Law

Prototype/ Demonstra&on

√√√√ (seeing is believing)

Depends on diagnos&c No √√√ demonstra&on – talk to end user

Animal Data YES YES MUST N/A

Publica&on Important Important MUST N/A

Scale Up Manufacturer ? GMP

Manufacturer? GMP CMC – manufacturing GMP

Must have or clear path

Reimbursement Current or new CPT HCPCS Compara&ve Effec&veness

YES Federal and State

Distribu&on Think through – alone or partner; countries

Important – Central Labs Think through -‐ alone or partner; by Countries

Must have

Launch/Market trajectory US/EU/ROW Adop&on -‐ uptake US/EU/ROW Adop&on -‐ uptake #TCNlive 11

Important “To Do’s”

–  Human Resources –  Legal –  Accoun&ng –  Insurance

•  Bank: need an account before applying for grants •  File with D&B for D-‐U-‐N –  Necessary to apply for grants with NIH/Government (non-‐dilu&ve!)

•  Website/Email -‐ secure domain name •  Company name/logo – Corporate Iden&ty •  Business Cards •  Networking – both for content and context


Addendum Plan Overview

Development Plan Legal – Corporate and IP


Plan Overview

•  Describe the business – Therapeu&c, diagnos&c, device, IT – Prepare business plan / presenta&on • Will we develop ourselves or with a partner (outsource) • What does the market look like •  Current and historical regulatory landscape • What are the barriers to entry • What are the comparables that show our model will work • What is the financing necessary to get to exit • What is the exit


Development Plan

•  Extremely important for you and investors •  GANTT-‐ &me and resources –  Iden&fy key milestones that drive demonstrable value inflec&on ($$$ -‐ how much necessary for each point) •  Prototype – device/IT •  CMC •  Animal data •  FDA discussion •  IND •  Phase 1

•  How will you execute –  CRO –  Joint development – strategic discussions -‐ stage


Legal – Corporate Structure

•  Incorpora&on – C Corp, LLC –  Form of company may affect who you target for funds

•  Capitaliza&on Table: ownership split with founders –  Op&on plan / agreement (plan ahead)

•  Key documents –  Employment agreements –  MA Law

•  Key Filings –  Delaware –  Tax


Legal -‐ IP

•  Intellectual Property firm not always the same as Corporate

•  Licensed IP in? Op&on Agreement •  Review terms closely •  Cost / &me period for op&on agreement •  Addi&onal IP needed •  Provisional patents/Filed patents – expense •  What is the short / long term IP strategy
