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Structuring Biotech & Pharma Startup Portfolios for Global Impact, Value, and Partnering July 30, 2020 Life Sciences Webinar Series

Life Sciences Webinar Series...Life Sciences Webinar Series Case Study on Common Issues for Early Stage/Startup BioPharma • Small teams, possibly working remotely, moving and pivoting

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Page 1: Life Sciences Webinar Series...Life Sciences Webinar Series Case Study on Common Issues for Early Stage/Startup BioPharma • Small teams, possibly working remotely, moving and pivoting

Structuring Biotech & Pharma Startup

Portfolios for Global Impact, Value,

and PartneringJuly 30, 2020

Life Sciences Webinar Series

Page 2: Life Sciences Webinar Series...Life Sciences Webinar Series Case Study on Common Issues for Early Stage/Startup BioPharma • Small teams, possibly working remotely, moving and pivoting

Case Study on Common Issues for Early Stage/Startup BioPharma

• Small teams, possibly working remotely, moving

and pivoting quickly

• Relying on CROs and Universities to prepare

and test compounds

• Using sophisticated screening assays / in silico

assays

• Laser focused on one or two programs

• Expect major partnering or exit by acquisition

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Page 3: Life Sciences Webinar Series...Life Sciences Webinar Series Case Study on Common Issues for Early Stage/Startup BioPharma • Small teams, possibly working remotely, moving and pivoting

Case Study

Page 4: Life Sciences Webinar Series...Life Sciences Webinar Series Case Study on Common Issues for Early Stage/Startup BioPharma • Small teams, possibly working remotely, moving and pivoting

Case Study

• Davy Biosciences, an early stage US pharmaceutical company, is developing novel

small molecules for the treatment of cancer

– Current focus on two new targets: BMT1 and EBMT2

• Working on developing a number of pipeline programs, some are at the discovery stage

while others have progressed to preclinical development

• No clinical development has started for any program to date

– Targets have shown to have high potential – and, if successful, could have applications in a

number of cancers or different subpopulations in a particular cancer

fr.com | 4

Davy Biosciences

Page 5: Life Sciences Webinar Series...Life Sciences Webinar Series Case Study on Common Issues for Early Stage/Startup BioPharma • Small teams, possibly working remotely, moving and pivoting

Case Study

• Davy Biosciences is a virtual company with a small

team of employees working across the US and the

world; founder has hired a number of former

colleagues from Goliath Pharma, where they

were working on NAMMT1 for treatment of cancer,

to work at Davy Biosciences

• Collaborations with multiple prestigious US

Universities – Haughty University and Stupendous

University – have facilitated access to proprietary

assays for validation of biological activity

• A CRO in China has been synthesizing new

compounds under the direction of Davy Biosciences

scientists

fr.com | 5

Page 6: Life Sciences Webinar Series...Life Sciences Webinar Series Case Study on Common Issues for Early Stage/Startup BioPharma • Small teams, possibly working remotely, moving and pivoting

Case Study

• Davy Biosciences’ financing to date has come

through a successful seed round, a Series A round,

and SBIR grants

• The company has formed two subsidiaries:

Daydream Biopharma (BMT1) and Believer

Biopharma (EBMT2)

• Davy Biosciences has recently entered into

partnering deals with two big pharma partners –

Sisyphus Pharma licensed BMT1 and Achilles

Therapeutics licensed EBMT2, each having the

option to license up to four more targets – that

have delivered upfront payments, together with the

potential for substantial milestone payments and

royalties

fr.com | 6

Page 7: Life Sciences Webinar Series...Life Sciences Webinar Series Case Study on Common Issues for Early Stage/Startup BioPharma • Small teams, possibly working remotely, moving and pivoting

Case Study

• In terms of strategy going forward, Davy

Biosciences’ investors are looking to achieve an

exit in the near term and are looking to proceed

with an IPO or, alternatively, to be acquired by a

large pharma company – potentially one of its

current license partners

• You’ve been hired as either the GC or the head of IP

for Davy Biosciences

– How do you wrap your head around the potential

issues?

– While also preparing the company for either one of

the two exit strategies?

fr.com | 7

Page 8: Life Sciences Webinar Series...Life Sciences Webinar Series Case Study on Common Issues for Early Stage/Startup BioPharma • Small teams, possibly working remotely, moving and pivoting

Hypotheticals

Page 9: Life Sciences Webinar Series...Life Sciences Webinar Series Case Study on Common Issues for Early Stage/Startup BioPharma • Small teams, possibly working remotely, moving and pivoting

Hypothetical #1 – Parents and Subs

fr.com | 9

• Davy Biosciences, an early stage US pharmaceutical company, is developing novel small molecules for the

treatment of cancer

– Current focus on two new targets: BMT1 and EBMT2

• Working on developing a number of pipeline products, some are at the discovery stage while some have progressed to

preclinical development

• None have entered the clinic

– Targets have shown some really exciting results – such that if successful, could have wide sweeping applications in a variety of

cancers and other indications

• The company has formed two subsidiaries, one for each of the two targets: Daydream Biopharma (BMT1) and

Believer Biopharma (EBMT2)

Daydream Biopharma

BMT1

Believer Biopharma

EBMT2

Davy Biosciences

Page 10: Life Sciences Webinar Series...Life Sciences Webinar Series Case Study on Common Issues for Early Stage/Startup BioPharma • Small teams, possibly working remotely, moving and pivoting

Hypothetical #1 – Parents and Subs

fr.com | 10

• Davy Biosciences has formed two subsidiaries, one for each of the two targets: Daydream Biopharma (BMT1)

and Believer Biopharma (EBMT2)

Daydream Biopharma

BMT1

Believer Biopharma

EBMT2

Davy Biosciences

Davy Biosciences

formed

Provisional #1 BMT1

Applicant: Davy Biosciences

Daydream Biopharma

formed

Provisional #1 EBMT2

Applicant: Davy Biosciences

Believer Biopharma

formed

Page 11: Life Sciences Webinar Series...Life Sciences Webinar Series Case Study on Common Issues for Early Stage/Startup BioPharma • Small teams, possibly working remotely, moving and pivoting

Hypothetical #2 – Clear Division Between Targets

fr.com | 11

• Davy Biosciences, an early stage US pharmaceutical company, is developing novel small

molecules for the treatment of cancer

– Current focus on two new targets: BMT1 and EBMT2

• Working on developing a number of pipeline products, some are at the discovery stage while

some have progressed to preclinical development

• None have entered the clinic

– Targets have shown some really exciting results – such that if successful, could have wide

sweeping applications in a variety of cancers and other indications

• Davy Biosciences has recently entered into partnering deals with two big pharma

partners – Sisyphus Pharma licensed BMT1 and Achilles Therapeutics licensed

EBMT2, each having the option to license up to four more targets

Page 12: Life Sciences Webinar Series...Life Sciences Webinar Series Case Study on Common Issues for Early Stage/Startup BioPharma • Small teams, possibly working remotely, moving and pivoting

Hypothetical #2 – Clear Division Between Targets

fr.com | 12

• Davy Biosciences, an early stage US pharmaceutical company, is developing novel small molecules for the treatment of cancer

– Current focus on two new targets: BMT1 and EBMT2

• Working on developing a number of pipeline products, some are at the discovery stage while some have progressed to preclinical development

• None have entered the clinic

– Targets have shown some really exciting results – such that if successful, could have wide sweeping applications in a variety of cancers and other

indications

• Davy Biosciences has recently entered into partnering deals with two big pharma partners – Sisyphus Pharma licensed BMT1

and Achilles Therapeutics licensed EBMT2, each having the option to license up to four more targets

BMT1 EBMT2

BMT1 EBMT2

BMT1 EBMT2

Early IP

Page 13: Life Sciences Webinar Series...Life Sciences Webinar Series Case Study on Common Issues for Early Stage/Startup BioPharma • Small teams, possibly working remotely, moving and pivoting

Hypothetical #2 – Clear Division Between Targets

fr.com | 13

BMT1 EBMT2

Early IP

Family #2 BMT1

Applicant: Daydream Biopharma

Family #3 EBMT2

Applicant: Believer Biopharma

Family #1

Generic coverage for compounds

targeting BMT1 and/or EBMT2

Applicant: Davy Biosciences

Page 14: Life Sciences Webinar Series...Life Sciences Webinar Series Case Study on Common Issues for Early Stage/Startup BioPharma • Small teams, possibly working remotely, moving and pivoting

Hypothetical #3 – Right to Claim Priority

fr.com | 14

• Davy Biosciences, an early stage US pharmaceutical company, is developing novel small

molecules for the treatment of cancer

• The company has formed two subsidiaries, one for each of the two targets: Daydream

Biopharma (BMT1) and Believer Biopharma (EBMT2)

Page 15: Life Sciences Webinar Series...Life Sciences Webinar Series Case Study on Common Issues for Early Stage/Startup BioPharma • Small teams, possibly working remotely, moving and pivoting

Hypothetical #3 – Right to Claim Priority

fr.com | 15

• Davy Biosciences, an early stage US pharmaceutical company, is developing novel small

molecules for the treatment of cancer

• The company has formed two subsidiaries, one for each of the two targets: Daydream

Biopharma (BMT1) and Believer Biopharma (EBMT2)

Provisional #1

Applicant: Davy Biosciences

Provisional #2

Applicant: Believer Biopharma

PCT

Applicant: Believer Biopharma

Believer Biopharma

formed

Page 16: Life Sciences Webinar Series...Life Sciences Webinar Series Case Study on Common Issues for Early Stage/Startup BioPharma • Small teams, possibly working remotely, moving and pivoting

Hypothetical #3 – Right to Claim Priority

fr.com | 16

• Intervening publication

Provisional #1

Applicant: Davy Biosciences

Provisional #2

Applicant: Believer Biopharma

PCT

Applicant: Believer Biopharma

Believer Biopharma

formed

Poster publication

based on select

Prov#1 compounds

Page 17: Life Sciences Webinar Series...Life Sciences Webinar Series Case Study on Common Issues for Early Stage/Startup BioPharma • Small teams, possibly working remotely, moving and pivoting

Hypothetical #3 – Right to Claim Priority

fr.com | 17

• Intervening Prior Art

• Services agreement between Davy Biosciences and Believer Biopharma requires

Applicant to be Believer Biopharma

Provisional #1

Applicant: Davy Biosciences

Claims compounds with X=H

Provisional #2

Applicant: Davy Biosciences

Claims compounds with X=H, F, etc.

PCT

Applicant: Davy Biosciences

Believer Biopharma

formed

Provisional #1

Applicant: Beatles Bio

Claims compounds with X=H

Page 18: Life Sciences Webinar Series...Life Sciences Webinar Series Case Study on Common Issues for Early Stage/Startup BioPharma • Small teams, possibly working remotely, moving and pivoting

Hypothetical #4 – Academic Collaborations

fr.com | 18

• Collaborations with multiple prestigious US

Universities – Haughty University and Stupendous

University – that have facilitated access to

proprietary assays for validation of biological activity

Page 19: Life Sciences Webinar Series...Life Sciences Webinar Series Case Study on Common Issues for Early Stage/Startup BioPharma • Small teams, possibly working remotely, moving and pivoting

Hypothetical #5 – CROs

fr.com | 19

• A CRO in China has been synthesizing new

compounds under the direction of Davy Biosciences

scientists

Page 20: Life Sciences Webinar Series...Life Sciences Webinar Series Case Study on Common Issues for Early Stage/Startup BioPharma • Small teams, possibly working remotely, moving and pivoting

Hypothetical #5 – CROs

fr.com | 20

• A CRO in China has been synthesizing new compounds under the direction of Davy

Biosciences scientists

Scenario

1) List of compounds for synthesis provided to the CRO

2) Compounds provided with a general synthetic strategy

Page 21: Life Sciences Webinar Series...Life Sciences Webinar Series Case Study on Common Issues for Early Stage/Startup BioPharma • Small teams, possibly working remotely, moving and pivoting

Hypothetical #5 – CROs

fr.com | 21

• A CRO in China has been synthesizing new compounds under the direction of Davy

Biosciences scientists

US Inventors CN Inventors

Page 22: Life Sciences Webinar Series...Life Sciences Webinar Series Case Study on Common Issues for Early Stage/Startup BioPharma • Small teams, possibly working remotely, moving and pivoting

Hypothetical #5 – CROs

fr.com | 22

• A CRO in China has been synthesizing new compounds under the direction of Davy

Biosciences scientists

US Inventors CN Inventors

1) Request expedited Foreign Filing License (FFL) from the US

2) File a “priority” PCT application in China (withdraw designation of the US)

3) REPEAT (as needed/desired)

4) File a “standard” PCT application claiming priority to “priority” PCT applications

5) Proceed through National Stage filings

Page 23: Life Sciences Webinar Series...Life Sciences Webinar Series Case Study on Common Issues for Early Stage/Startup BioPharma • Small teams, possibly working remotely, moving and pivoting

Hypothetical #6 – Employees

fr.com | 23

• Davy Biosciences is a virtual company with a small

team of employees working across the US and the

world; founder has hired a number of former

colleagues from Goliath Pharma, where they

were working on NAMMT1 for treatment of cancer,

to work at Davy Biosciences

Page 24: Life Sciences Webinar Series...Life Sciences Webinar Series Case Study on Common Issues for Early Stage/Startup BioPharma • Small teams, possibly working remotely, moving and pivoting

Hypothetical #6 – Employees

fr.com | 24

• Davy Biosciences is a virtual company with a small team of employees working across the

US and the world; founder has hired a number of former colleagues from Goliath Pharma,

where they were working on NAMMT1 for treatment of cancer, to work at Davy Biosciences

Start discussions with Founder

Inventive Activity

Goliath Pharma Employee Davy Biosciences Employee

Page 25: Life Sciences Webinar Series...Life Sciences Webinar Series Case Study on Common Issues for Early Stage/Startup BioPharma • Small teams, possibly working remotely, moving and pivoting

Hypothetical #7 – When to File

fr.com | 25

• Davy Biosciences, an early stage US pharmaceutical company, is developing novel small

molecules for the treatment of cancer

– Current focus on two new targets: BMT1 and EBMT2

• Working on developing a number of pipeline programs, some are at the discovery stage while

others have progressed to preclinical development

• No clinical development has started for any program to date

– Targets have shown to have high potential – and, if successful, could have wide sweeping

applications in a variety of cancers and other indications

Page 26: Life Sciences Webinar Series...Life Sciences Webinar Series Case Study on Common Issues for Early Stage/Startup BioPharma • Small teams, possibly working remotely, moving and pivoting

Hypothetical #7 – When to File

fr.com | 26

Provisional #1

Generic

coverage of

lead compound

PCTProvisional #2

Specific

coverage of

lead compound

Scenario

1) File first provisional with limited compounds and no/limited data

2) Follow-up provisional with additional compounds and supporting data

Page 27: Life Sciences Webinar Series...Life Sciences Webinar Series Case Study on Common Issues for Early Stage/Startup BioPharma • Small teams, possibly working remotely, moving and pivoting

Hypothetical #7 – When to File

fr.com | 27

Provisional #1

Generic

coverage of

lead compound

PCT

Beatles Bio Provisional #1

Species included which

anticipates genus of

DB Provisional #1

Provisional #2

Specific

coverage of

lead compound

Beatles Bio

PCT Publishes

Potential FTO and

patentability issue for DB lead

compound

Beatles Bio PCT filed

Genus expanded to cover

DB lead compound

Page 28: Life Sciences Webinar Series...Life Sciences Webinar Series Case Study on Common Issues for Early Stage/Startup BioPharma • Small teams, possibly working remotely, moving and pivoting

Hypothetical #7 – When to File

fr.com | 28

Provisional #1

Generic

coverage of

lead compound

PCT

Beatles Bio Provisional #1

Species anticipating

DB Provisional #1

Provisional #2

Specific

coverage of

lead compound

Beatles Bio PCT filed

Genus expanded to cover

DB lead compound

Page 29: Life Sciences Webinar Series...Life Sciences Webinar Series Case Study on Common Issues for Early Stage/Startup BioPharma • Small teams, possibly working remotely, moving and pivoting

Hypothetical #8 – Preparing for the Exit

• In terms of strategy going forward, Davy Biosciences’ investors are looking to achieve an

exit in the near term and are looking to proceed with an IPO or, alternatively, to be acquired

by a large pharma company – potentially one of its current license partners

fr.com | 29

Davy Biosciences

Page 30: Life Sciences Webinar Series...Life Sciences Webinar Series Case Study on Common Issues for Early Stage/Startup BioPharma • Small teams, possibly working remotely, moving and pivoting

© Copyright 2020 Fish & Richardson P.C. The opinions expressed are those of the authors and do not necessarily reflect the views of Fish &

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Thank You!

Teresa Lavoie

Principal

[email protected]

Angela Follett

Principal

[email protected]

Please send your NY/NJ CLE forms or CLE

questions to [email protected].

Questions about the webinar should be sent

to Lauren McGovern at [email protected]

A replay of the webinar will be available for

viewing at http://www.fr.com/webinars