Group 10: Shane Stiller, David Berry, Colin Kraczkowsky June 8, 2014

TIM 80C Business Plan

Mednology Business Plan

I. Introduction I a) Executive Summary

Our company Mednology was established in 2014, we are a growing, innovative company in nanotechnology. After assessing companies involved in the nanotechnology space, we have determined that the technology isn’t far from being realized as a reality, (give-or-take within the next 25 years). We will be at the frontier of this rapidly expanding industry providing Mednology with a powerful platform. Since we at Mednology will be one of the first to use nanotechnology to develop a medical treatment, we have the rare opportunity to shape the future of a technology and show how to use it for good. We have strived to combine medical practices with future technology so that we can treat specific cancer ailments with reliable results.

Within the decade our leading product Nanites will have a successful prototype

and be prepared to enter the market to battle cancer around 2025. Our company has over a decade to be one of the first to get a solid product out in the market. When our Nannites are ready to begin treating patients, those afflicted by melanoma cancer will rush to us from around the world in search of reliable relief. Our product competes in the market by offering a quality procedure with high reliability, in the least invasive way possible for our patients.

Mednology expects to seize around 10% of the market seeking quality

specialized cancer treatment. Our customers will include hospitals of varying degrees, whom have many patients in need of our services. Nannites will be highly effective and reliable at accomplishing their purpose for our target patients who are seeking quality, minimally invasive treatment. This makes hospitals a prime buyer of our product because they have a large variety of patients, many of whom will be ecstatic to discover a new reliable and comfortable cure.

Unlike other means of cancer therapy, which sometimes can only keep the

ailment at bay or caused physical trauma through surgical means, Mednology’s Nannites will eliminate the ailment all together. No damage will be endured by the patient during treatment due to the noninvasive nature of Nannites - meaning patients

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won’t be ridden to long periods of recovery. Because Nannites can seek out and target specific cancer cells, patients don’t have to deal with the debilitating effects of chemotherapy. As a cure an preventative means of disease, Nannites are thus safer than either surgical or radioactive procedures. Lastly, the nature of Nannites lends itself to adaptability - they can be used for much more than just curing cancer, but also in the cure and prevention of other ailments as well. _____________________________________________________________________ Where we are going.

Company Vision

Mednology seeks to lead a new age of medicine to our world, providing us all with a new era of defenses against the most powerful diseases humans face today. The mark of death that terrorizes so many by crushing the promise of tomorrow will be nothing more than a harmless, misidentified beauty mark from yesterday due to a mix of medicine and technology – Mednology. Who we are.

Company Mission Statement

Our goal at Mednology is to relieve the grief that cancer has stricken millions

with. Technological advancements have allowed for treatments, however many of the current options are not reliable. Sometimes the side effects of treatments do more harm than good, damaging everything to alleviate a small portion of the ailment. Mednology seeks to be innovative – we devise solutions to simply remove the ailments of patients while being as unintrusive as possible. Mednology fuses nanotechnology with the science of medicine in our product Nannites to be used as an effective cancer treatment. _____________________________________________________________________ I b) Management Team

Chief Executive Officer - CEO - Shane Stiller

With a background in Technology and Information Management, Shane’s experience will most benefit the firm in a prominent role. As chief executive officer, Shane’s main responsibilities will include developing and implementing high-level strategies, making major corporate decisions, managing the overall operations and resources of a company, and acting as the main point of communication between the board of directors and the corporate operations. Given that we are currently a smaller

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firm, our CEO will play a much more hands-on role than that of one in a larger firm by also making many of the lower-level decisions as well.

Chief Technology Officer - CTO - David Berry

David will be responsible for the management of our company’s research and

development as well as technological needs. As chief technology officer, David will examine the short- and long-term technical needs of our company and utilize capital to make investments designed to help our firm realize our vision through adhering to our mission statement.

Chief Financial Officer - CFO - Colin Kraczkowsky

The chief financial officer is in charge of overseeing the financial activities of our firm. Colin’s responsibilities will include financial planning and monitoring cash flow. We will use this information in the analysis of our company's financial strengths and weaknesses to create plans for improvement. As a small-size firm, Colin will serve as both the accounting and finance departments and be responsible for ensuring that the company's financial reports are accurate, completed on time, and follow GAAP and other fiscal regulations. _____________________________________________________________________ I c) Business Goals

Timeline Annual Revenue

Years 0 - 4 We will be in development phase with annual costs of around $2.8 million. We will be funding this through a combined long-term loan and venture capital seed funding.

Years 5 - 6 We will launch the product and begin marketing/sales efforts. Costs of ramping up from development to production is projected at $2 million which we will fund through a short-term loan. Once production is in motion we expect to begin generating a positive cash flows

Years 7 - 10 We will be engaged in extensive marketing and production efforts costing around $17.7 million annually. We will be offsetting this cost with a progressively scaleable sales schedule. We hope to sell 50% of our inventory in year 6, 80% of our inventory in year 7, and 100% of our inventory by year 8. Following this schedule projects $64 million in annual sales and a growing profit by the end of fiscal year 8.

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______________________________________________________________ II. Product Concept Diagram of a Basic Nannite:

On a more basic level a Nannite would consist of a main processor, a power

source, and programing to run its operations. The processor controls most of all functions, from circuited connection to other hardware. Like a normal computer, programing would run the hardware - the AI programing acts as a sort of operating system for the Nannite in that it controls all program instructions used to manage hardware in addition to allowing the Nannite to act on its own to a limited degree. the sub processor and memory allow for multitasking among the use of various hardware and software functionality.

Dissection of Substitute Treatment:

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Chemotherapy is currently one of the most widely used cancer treatment

packages in our target market. The treatment is used to contain cancerous cells, slow the cancer’s growth, and ultimately to cure the patient. These functions take form in a number of methods to enter the body, treat the cancer, and portion out an appropriate dosage. As a substitute to chemotherapy, Mednology seeks to integrate some of these familiar sub-functions into our product offering as well as provide a treatment package that surpasses the sometimes limited capabilities of current therapies. Function Structure for Nanobot: Pulling from from the capabilities of a simple nanobot and chemotherapy treatment, we developed a function structure for our Nannite technology by removing leaf forms and subfunctions.

In essence, all that’s needed for the ideal nanobot is, “[...] a transporting

mechanism, an internal processor and a fuel unit of some kind that enables it to

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function.” ( nanogloss.com ). This function structure details the hardware that will be connected to the internal processor, along with what software processes it will handle.

For treatments, nanobots will contain storage compartments for transporting

medicines that treat internal cancerous growths. A vat jet can dispense the medicine directly onto infected areas, or a syringe can inject treatment directly into cancerous cells. For radiation treatments, a radiation gun can be directed at infected cells. It will hold its power source to avoid draining the nanobots’ power supplies. For analysis of cells, culture samples can be taken and examined by the nanobot, with the information sent to a physician through ID Culture Sampler Tool and driver.

For navigation, a wireless signal transmitter and receiver will allow physicians to

know the location of the nanobot, in addition to providing additional instruction for it to follow. Ultrasound will enable the nanobot to use a CT scan of a patient’s body to navigate the environment, and locate targeted areas.

As a failsafe, in the event a nanobot is damaged or presents a danger to a

patient, three special operations can be initiated to disable it. These lie within the Bad-Bot Protocol software and the Emergency Failsafes. The Function Status Indicator will let physician, and other nanobots in a procedure, know when a nanobot is to be disposed of:

● Cannibalistic Protocol: In the event groups of nanobots are used in a

procedure, non-damaged and operative nanobots will deconstruct and destroy the damaged nanobot so that it does not cause harm to the patient.

● Self-Termination Protocol: If a procedure uses one nanobot, and that

nanobot is damaged and inoperable, an emergency self-termination system can be used. Upon receiving the “kill-self” signal from a physician, the damaged nanobot deconstructs itself through the use of enzymes, dissolving into a harmless jelly mass that the body can remove easily via its own processes. This mass gives off a unique identifier to confirm that a nanobot self-terminated.

● Magnetically Triggered Termination: The nanobots will be susceptible to

strong magnets, causing a complete shutdown when exposed to their pulls for a set duration, either directly or indirectly. This magnetic pulls activates a mechanical switch that releases enzymes to deconstruct the nanobot, similar to the self-termination protocol.

The nanobots’ AI and network of communication allow for them to work together

to accomplish surgical tasks. Because of their extremely small size, measuring about six atoms across, (nanogloss.com), numbers sometimes play a major role in dealing with ailments. A cancerous growth that’s only a mere centimeter across would be

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thousands of times bigger than a single nanobot. Because of this, the nanobots can connect to together through a series of Nanobot-to-Nanobot Cluster Connections in order to adjust their size. The Nanobot Group Cluster Synchronization Protocol would allow for a cluster of conjoined nanobots to combine their resources to act as one unite. Lastly, the power source will be scaled to match the nano-size of the bots, (Nanobatteries). Product Offering: Our Product: The Nannites Treatment Package

Sub Functions: Patch delivers nanobots, use properties of surface adhesion to achieve mobility, 1 automatic failsafe, 1 manual failsafe, ultrasound navigation, wireless communication, AI analyzes cell culture then physician verifies, AI guides coordination but physician guides, specialized tools for rays and surgical equipment, search and treatment pre-programmed and physician guidance, rechargeable battery Pros: Both automatic and manual failsafes allow for greater control in the event of a failure, AI working alongside physicians to analyze data and determine navigation and treatment procedures allows for more efficient use of time. The use of surface adhesion for movement will achieve greater accuracy and mobility. A rechargeable battery will allow for higher outputs of energy than an engine. Cons: The reliance on AI and wireless communication can allow for failures which will be harder to control/recover from. The physician checking of the AI’s decisions will waste time, but will guarantee the AI is making the correct decision when it comes to navigation and treatment selection.

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Having developed a comprehensive morphological matrix of the sub-functions

and realized forms of cancer-treating nanotechnology, we chose to pursue the Nannite bundle because it is the most reliable package. This bundle can deliver a variety of treatments and the physician-backed decision making will ensure quality performance. After analyzing our potential product designs created through our team’s idea generation conclave, we determined that the relatively high technical feasibility and large commercialization potential makes pursuing Nannites a “pearl” product idea. We decided to pursue a product design which will allow for the most reliable service. Our product will provide reliability through a combination of manual and AI failsafes. The non invasive delivery of our treatment ensures the patient experiences minimal discomfort during the procedure. ___________________________________________________________________ III. Business Strategy

In this section, we dictate the forces which play a role in shaping the curative

technologies market. A brief analysis of the market shows that by being one of the first to develop this technology we will be able to secure a segment. Once our product is developed it will be challenging for new entrants to compete with us, and buyers will have negligible bargaining power. All in all this market is very attractive, it has a large revenue pool and a stable yet high growth rate for its size. III a) Porter’s Five Forces “The Technology/Cancer Treatment Industry”:

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Competitive Rivalry

Companies in the cancer treatment industry: ~Somi Pharmaceuticals - Provide anti cancer drugs ~Exponential Exports - Provides anti cancer medicine ~Nisheeta Lifesciences - Provides anti cancer medicines ~Balaji Pharma - Provide anti cancer medicine ~Kuber Surgical - Provides skin cancer drugs, ovarian cancer drugs

Companies in the nanotechnology industry: ~Ablynx - Engaged in the discovery and development of nanobodies to treat a range of serious human diseases ~Carbon Nanotech Research Institute - Development of fullerenes and carbon nanotubes which are applicable to next generation semiconductor, fuel cells, drug remedies ~ImaRx Therapeutics - In the process of developing NanoInvasive medicine which will provide the benefit to patients and society by lowering costs, minimizing pain.

Threat of New Entry - LOW

The industry of nanotechnology in medicine is a new and upcoming field, there is

very limited amount of available research to use. If a company wants to enter this Page | 9

industry they would need to invest heavily in research in order to develop their product. Another barrier to entry is the need for highly specialized individuals who can develop a working prototype. This industry would also require a high amount of capital investment in order to efficiently manufacture the nano bots on a large scale. Threat of Substitution - MEDIUM

There are other options for treating cancer which currently exist. Most of these

other option will be expensive but not as much as a new nano treatment. Many current substitutes can be painful and/or time consuming when compared to nano treatments. The downside of switching treatments mid process is there will be costs one can not recover. Patients are unlikely to substitute because other treatment options may have more severe side effects. Buyer Power - LOW

Patients seeking cancer treatment will have a very high demand to be treated.

Buyers seeking treatment will make their selection based on comfort, cost, timeliness and most importantly reliability. Buyer influence over this market is low because there are few substitutes and demand for service is extremely high. Supplier Power - MEDIUM

Suppliers for nanotechnology will have more power than suppliers of the nano medicine industry. This is because research, patents and specialists in the field of nanotechnology are newer as well as more expensive and timely to acquire. When purchasing highly specialized nano bot parts there are not many options so these suppliers will have a lot of power over the price and availability of the parts.

Suppliers for cancer treatments will have lower power, this is because there are

many different procedures to treat cancer. There are also many companies manufacturing the supplies, both local and recently a worldwide market. This market forces companies to offer lower competitive prices. The threat from suppliers in the field of cancer treatment is dampened because its a larger industry which has been around for longer. III b) Porter Model Analysis:

Nannites are at the frontier of the new age of medicine, what we have done at Mednology is create a product our world will appreciate for decades to come. We are offering a reliable defense to one of the most horrid diseases of all time. There are few substitutes that can compare to the quality treatment our product offers. Our clients want nothing besides the most reliable service for their life threatening condition. The high demand for our product will provide Mednology with a strong market presence. With a solid stance in the market our threat from new entry is low, accompanied with a

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strong legal presence our position in this market is secured for years to come. Our product will quickly grow to dominate the cancer treatment market. After a few years we will be able to manufacture our own Nannites. This will strengthen Mednology by allowing us to sever much of our reliance on suppliers and increase the difficulty for new entrant to compete with us in the market. All these factors combine together to outline the attractiveness of entering this market now. ___________________________________________________________________ IV. Market Strategy

In summary, our market strategy is to advertise our product to hospitals and private practices through showcasing and word of mouth. We decided to target this segment of the market because it has a large revenue pool with a stable growth rate. We discovered this by generating a revenue map that indicated which market segments were both highly profitable and allowed room for innovation signaling continued growth of the industry. We then drafted a marketing mix to define the product, price, place, and promotion of the Nannites treatment technology as this is crucial to determine our product’s offering. Through this, we realized that Mednology’s target customers would be those with melanoma cancer seeking a minimally invasive treatment procedure. Given the circumstances of our consumer and the expenses associated with our product, Nannites were priced at a slight premium of $100,000 per session. We hope to bring that price down in the future through increased bargaining power with our suppliers and decreasing costs of goods sold. We will be perpetuating our focussed strategy by promoting Nannites technology through channels representing particular customers. We hope marketing in this way will get our product into specialized medical facilities who can most effectively and efficiently distribute the Nannites treatment solution to our target customers. IV a) Revenue Map:

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A revenue mapping of the medical device industry. A medical device is an apparatus that is used to diagnose, prevent, or treat medical conditions not achieved through chemical action within or on the body differentiating them from drugs. The products offered in this industry are devices for performing medical tests, man-made medical implants manufactured to replace a missing biological structure or enhance an existing structure (i.e. pins, rods, screws, and plates), prosthetic body part replacements, equipment to perform a diagnosis, technology for curing a medical condition, and general purpose medical devices (i.e. tongue depressors and medical thermometers). From mapping the market landscape of the medical device industry, Mednology has identified a large, growing target market within curative technology for public hospitals with extreme profit potential. IV b) Marketing Mix: Product: What the customers in the segment want from the product?

Our product is Nannites treatment, a nanotechnology solution to melanomacancer. Our technology is a minimally invasive medical option that serves to diagnose, prevent, treat, and cure melanoma cancer.

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Price: What are the customers willing to pay for the product?

Current melanoma cancer treatment can average a cost of around $90,000 for an 8 week cycle. That’s around $11,250 per session. Since we are a differentiated product with relatively large-scale development costs we are looking to price the Nannites treatment at a slight premium. At a price of $100,000 per session, we could successfully achieve our business goal of obtaining ⅕ of the public hospital market interested in curative technology after performing 60,000 sessions. Using 8 weeks as a base for a full round of melanoma treatment, we would need to cycle 7,500 patients through the Nannites treatment. It s estimated that around 80,000 cases of melanoma will be diagnosed in the United States annually meaning we need just 9.375% of that market to achieve our goal at this price point.

Place: What are the distribution channels for the product?

Mednology will offer Nannites through trained hospitals and cancer treatmentpractices. In the future, Mednology may investigate expanding into specialized Mednology centers.

Promotion

Mednology will establish a market presence and extend our brand name through two channels: one targeting hospitals/private practices and one targeting individuals. Since hospitals and private practices will ultimately be the ones using Nannites technology, we will promote the product at medical conventions and trade-shows to showcase the curative qualities of our nanotechnology. To target individuals to get them interested in our product we will give participating hospitals and practices brochures to keep at their offices. We also hope to establish a positive word-of-mouth so friends and families of loved ones with melanoma are aware of Nannites as an option.

____________________________________________________________________ V. Product Strategy

Customer’s Need: a cure for melanoma cancer

■ Solution – product technology to perform cancer treatment

○ A five year plan is directed towards rapid development of both the start-up and the Nannites. It focuses on financial stability, resource accumulation, and product development and refinement, in that order. While things will move fast, development will not be rushed. Quality is of top priority in meeting product expectations.

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Year 1: ■ Funding Generation: Because cost can be as much as $1 billion

dollars, this will be the initial funding goal. In getting the company started, it will begin once funding reaches 30% of the initial funding goal - $3 million dollars. This will allow for the first year to be fully funded with a little extra funding for emergencies.

■ Resources: With enough funds for a year, a lab facility will be

rented out. Lab technicians and physicians will be hired to work on prototype construction. Lab equipment and materials will be purchased, in addition to maintenance.

● lab facilities ● lab equipment ● storage space ● lab technicians ● hardware engineers ● software engineers ● medical physicians ● raw materials - chemicals, molecular materials

Year 2:

■ Prototyping - Nanobot: Lab technicians and physicians will work to realize the first stages of a physical product, a nanobot. Once a working, physical prototype is made it will be programed and prepped for testing.

Year 3:

■ Testing – Cancer Treatment: The prototype nanobot will be used in testing in identifying, and eliminating cancer cells by various treatment methods – from physical removal, to injection, to radiation.

■ First Results and Conclusion: The overall success and

considerations of prototyping and testing will be reviewed. Promising results will be used to generate more funding from the NIH and the NSF, along with crowdfunding.

Year 4:

■ Further Prototyping and Testing (Cycle and Iron Out): Refinement of the technology will be done to improve treatments. Flaws and bugs are to be ironed out through a cycle of prototyping, testing, and result phases. All good findings will be used for further funding.

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■ Self-Copy: This simply tests a design of nanotechnology for duplicability. Nanobots will be programed and capable of constructing nanobots – copying themselves.

Year 5:

■ Finalizing Field Test: Once the nanobot is deemed to be suitable for medical use, three final tests are performed on a dummy to simulate a real treatment. The nanobot design and treatment method has to pass all three tests to be fully deemed ready for medical use. Nanobot designs and treatments that fail will go back to the Cycling and Iron Out Phase.

■ Final Confirmation: The nanobot product and cancer treatment

methods used are all ready for medical use. This will lead to the product release.

_____________________________________________________________________ VI. Financial Analysis

Below we have produced some drafts of our financial statements from development phase to the year where we predict we will have reached a positive net present value making the investment lucrative. Mednology is currently seeking $10 million in seed money to help finance our development costs before we ramp up to our sales phase in which the company can begin supporting itself. Within 2 years after launch, we expect our sales to scale towards our full production schedule. By 2021 we project sales to match production and generating annual revenue of $40,000,000 and a net profit of $11,145,000.

VI a) Cash Flow Statements:

These drafted statements of cash flows provide estimated aggregate data regarding all cash outflows that will pay for our business activities between our natal day in Year One to the year we project our operations will produce a positive present cash value in Year Eight. Also reflected are the cash inflows Mednology will be receiving from our ongoing operations and external investment sources. As shown, we intend to finance our development costs within the first five years through external investors before we ramp up to marketing, production, and sales to generate positive cash flows and use our retained earnings to fund our ongoing marketing and production schedules. We predict positive cash flows by the first quarter of year six and a positive net present value two years after that at the beginning of year eight.

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In Mednology’s natal years (Year 1 ~ Year 5), all our financial resources will be utilized in developing the Nannites technology. We are looking at renting two labs: one to research nanotechnology and another focused on cancer treatment. We expect our development team to be around 35 strong consisting of engineers and specialists in nanotechnology, cancer research. Along with equipment and supplies, we estimate our development costs to total $2.6 million annually.

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We project it will take about 5 years to develop a fully functional Nannite at which point we will ramp up to begin marketing and sales efforts. We plan to spend $3 million on advertising in the first year through TV segments, a web campaign, direct mail, and search engine optimization. We intend to finance this with a single year loan so as to avoid over saturating our venture capital investors. By Year 6, we intend to start producing and distributing Nannite treatments and begin generating positive cash flows of around $1.5 million per quarter.

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* Note that Net Present Value is positive by the fourth quarter of Year 7 meaning that we expect Nannites technology to be a sound investment within eight years of operation VI b) Balance Sheets:

Our balance sheet segments give our investors an idea as to what the company owns and owes, as well as the amount invested by our shareholders.

As seen in the figure above, Mednology expects to show positive worth of assets and increasing stockholder’s equity which we will retain in the firm to continue growing before paying out as dividends. VI c) Income Statements:

These drafted income statements disclose information about revenues and expenses that are a direct result of the regular business operations.

If we began development today, we project profits nearing the amount of the initial investment as soon as 2019 and then tripling within two years. By 2021 we expect a profit margin of 28%, an increase of 75% from 2019. Our excellent return on assets alludes to our effective means at converting investment into income and further illuminates nanotechnology’s cost savings potential.

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VI d) Key Financial Ratios:

* If development began in 2014, we project a profit margin of 28% by 2021.

Mednology’s Nannites treatment technology expects to be showing profits nearing $5 million by our 8th year of operations. To make this happen we will need around $15 million in funding. Our finance plan is three-tier including a combination of debt and equity financing. At the beginning of our operations, we will be taking out a $2 million long term loan to help supplement our development costs. To support our marketing ramp up costs and avoid over saturating our venture capital funding options, Mednology will be withdrawing a $3 million short-term loan. That leaves $10 million we are hoping to realize through venture capital seeding. Mednology is willing to distribute 40% of our shares in return for the $10 million investment. This dilution would give Mednology a post-money valuation of $25 million and a pre-money valuation of $15 million. To achieve our goal of $1 per share, Mednology is preparing to generate 25 million shares and is willing to offer 10 million shares valued at $10 million (the value of the investment) in return for a seed money investment.

In eight years, Mednology predicts a return on investment of three-fold. For an

initial venture capital investment of $10 million, Mednology is offering a unique opportunity to disrupt the healthcare industry through the revolutionary new cancer therapy technology: the Nannite treatment package.

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VII. Appendix

VII a) Developing the Product Concept:

We started with an issue. We had utilized structure brainstorming to generate a number of areas in the world today where we saw the need for improvement. Our list ranged from transportation to health and fitness before we landed on the topic of healthcare, in particular current treatments for cancerous cells. We wanted to develop a new way to help those suffering from cancer and also integrate the budding field of nanotechnology. Our list for necessary components to our product included:

1. Noninvasive surgical procedures to eliminate tissue damage and reduce recovery time

2. A direct approach to removing cancer cells that don’t require the patient to be exposed to large doses of radiation for long periods of time

3. Isolation of cancer cell in order to leave healthy cell unaltered and intact to preserve the overall health of patients

4. Allow for a speedy treatment and recovery 5. Act as a one-time treatment, rather than an ongoing therapy

That is how the concept for a nano surgeon robot was formed and our company,

Mednology, was ultimately created. We felt “Mednology”, as a combination of both medicine and technology, best represented who we were and where we were going as dictated by our mission and vision statements. Our CTO, David Berry, came up with the product name Nannite and we began drafting what would ultimately evolve into the function structure of our first nano surgeon robot:

● Nano-sized robots (0.1 to 10 micrometers in size, less than 1/100th of a

millimeter) ● Capable of entering the human body in a noninvasive, or damaging, way ● Allow for visual inside the human body ● Can acquire culture samples from possible internal ailments for doctor analysis ● Is nonreactive, or invisible, to the human immune system as to not trigger

immune responses ● Capable of searching, locating, and identifying harmful pathogens and

substances inside the body ● Can inject substances directly into ailments for treatment ● Can physically remove and destroy ailments with precision through noninvasive

surgical procedures

After grounding our concept in an idea of what we wanted it to be able to accomplish, we began looking at current technologies and cancer treatments to develop ideas for additional sub-functions and potential new forms for our Nannite technology. We then took these ideas and organized them into a morphological matrix to find the best product bundle for our consumers.

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VII b) Morphological Matrix:

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Bundle #1: (Red)

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Sub Functions: Injection, cell hitchhiking, 1 automatic failsafe, programmed ct map, wireless feeds, ai analyzes cell cultures, ai achieves communication, high energy rays, pre-programmed instructions, rechargeable battery. Pros: The injection is not invasive and the automatic failsafes and AI will allow the nanobots to finish treatment very quickly. Rechargeable battery will allow for longer and more reliable power source. Cons: Movement is controlled by blood pressure, lack of surgical tools on nanobots prevents them from being able to offer all treatments. The lack of manual control by a physician makes the risk of nanobots failure higher. Rechargeable battery is heavy and space consuming Bundle #2: (Green) Sub Functions: Pill delivery, magnetic grappling, 1 manual failsafe, ultrasound navigation, hardwire communication, manual analysis of cell culture, manual control of nanobots, specialized surgical tools, search and treatment manual control, energy generator uses organic material as fuel. Pros: Manual control makes the nanobots more reliably controlled, the surgical tools can target larger cancer groups. Engine using organic material will not need to return to recharge battery as often and will weigh less than a battery. Cons: Manual control requires more time, effort and is more bulky. The lack of automatic AI will require more expertise on the physician's part. The engine is reliant on a fuel source constantly around it, failure to find a fuel source will result in shutdown. Bundle #3: (Blue) Sub Functions: Patch delivers nanobots, use properties of surface adhesion to achieve mobility, 1 automatic failsafe, 1 manual failsafe, ultrasound navigation, wireless communication, AI analyzes cell culture then physician verifies, AI guides coordination but physician guides, specialized tools for rays and surgical equipment, search and treatment pre-programmed and physician guidance, rechargeable battery Pros: Both automatic and manual failsafes allow for greater control in the event of a failure, AI working alongside physicians to analyze data and determine navigation and treatment procedures allows for more efficient use of time. The use of surface adhesion for movement will achieve greater accuracy and mobility. A rechargeable battery will allow for higher outputs of energy than an engine. Cons: The reliance on AI and wireless communication can allow for failures which will be harder to control/recover from. The physician checking of the AI’s decisions will waste time, but will guarantee the AI is making the correct decision when it comes to navigation and treatment selection. We picked Bundle #3 because it is the most reliable package. This bundle can deliver a variety of treatments and the physician backed decision making will ensure quality performance.

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VII b) Diagram of Fully Functioning Nannite:

VII c) Breakdown of Financial Expenses : Product Development

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-Facilities Rental (Monday-Friday): Nanotechnology research lab $110,000 /annually Cancer treatment research lab $110,000 /annually Small Storage Facility $80,000 /annually estimation

-Salaries:

Nanotechnology researchers(10) $60,000 /annually=$600,000 Cancer researchers(10) $50,000 /annually=$500,000 Prototype engineers(15) $70,000 /annually=$1,050,000

-Research supplies: $40,000 /annually

-Research equipment:

Equipment rental cos(2) $100,000 /annually Equipment purchase cost(2) $25,000 /fixed cost Equipment maintenance cost(2) $30,000 /annually

-Prototyping: $2,645,000 / annual development

Product Manufacturing

-Cost to manufacture: Material cost $5,000 /annually Capital cost $100,000 /annually Initial Cost per Nanite $0.01/per unit if not less ** Initial Cost per Nanite Controler $8.00/per unit

estimation

-Distribution cost: $406,850 /annually

** Nanites are nano-sized robots, being the size of six atoms. A little investment in building material will allow for an enormous production of nanites because of their size - a drop of water contains about 5 sextillion atoms, (that’s 5,000,000,000,000,000,000,000), for size perspective. Logically speaking, a drop of liquid silicon solution could contribute to building billions of nanites, while a gallon can possibly fuel the creation of trillions on top of trillions of nanites. Additionally, because it is more efficient to have nanites build other nanites, large-scale production would be entirely under the founding start-up’s power with no additional cost aside from material. Marketing and Sales

-Marketers salary(3): $90,000 /annually

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-Advertising costs: National TV Advertising:

Setup cost: $100,000 Cost of media: $50,000 / per 30 seconds

Search Engine Optimization:

Setup cost: $7000 Cost to continue: $6000 /annually

Web Content Marketing Campaign: Setup cost: $9000

Direct Mail Advertising:

Setup cost: $2000 Cost of media: $2 /per address

Management and Support

-Managements salary(3): $70,000 /annually

-Legal costs: Lawyers salary(1) $90,000 /annually Patents(1) $7,000

Human Resources () $90,000 /annually

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