the university of pittsburgh creating the best investments carolyn green, director office of...
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The University of Pittsburgh
Creating the Best Investments
Carolyn Green, Director Office of Enterprise Development, Health
SciencesUniversity of Pittsburgh Schools of Health
Sciences
Office of Enterprise Development, Health Sciences
“One way to have a good idea is to have a lot of ideas, and throw the bad ones away.”
~Dr. Linus Pauling ~Dr. Linus Pauling
American theoretical chemist and biologist 1901-American theoretical chemist and biologist 1901-19941994
The Evolution of Biomedical Research1940
1950
1960
1970
1980
1990
2000
1943 – DNA is shown to be the basic genetic material
1953 – Watson and Crick identify DNAs double helix
•1972 - Paul Berg makes first rDNA•1977 - First human protein (somatostatin) manufactured in bacteria•1978 - Herb Boyer uses e-coli to make recombinant human insulin
1966 – DNA’s complete genetic code deciphered
•1980 – Kary Mullis invents PCR; The patent is sold in 1991 for $300M•1981 – Ohio University scientists produce first transgenic animals•1982 – Genentech markets recombinant human insulin•1986 – Chiron granted a license for recombinant hepatitis B vaccine; Genentech markets rt-PA
2000 – Pharmacogenomics produce Herceptin with accompanying diagnostic test
•1990 – First gene therapy on 4 year old with ADA•1996 – Genetic maps of humans and mice complete; Avonex approved for treatment of MS•1997 – FDA approves Rituxan for non-Hodgkin’s lymphoma; Dolly is cloned in the UK•1998 – Embryonic stem cells grown for the first time; an inexpensive E. coli biosensor sold
US Patent Office Activity
0100,000200,000300,000400,000500,000600,000700,000800,000
Year
Pat
ents Awaiting Action
Total Pending
“Intellectual Property Protection” becomes part of the biomedical
research lexicon…
UNIVERSITY INDUSTRY
Commercializationof New and Useful
Technologies
Teaching
Research
Service
EconomicDevelopment
Profits
Product R&D
Knowledge for Knowledge’s Sake
Academic FreedomOpen Discourse
Management ofKnowledge for Profit
ConfidentialityLimited Public Disclosure
Conflicting Values - Common Interest
Overcoming barriers to success…
Cultural barriers Legal barriers Financial barriers High risks associated with all
embryonic technologies
Cultural BarriersEntrepreneurship is….
• Not part of the cultural norm in academic medicine• May restrict ability to publish• Hampered by restrictive policies and procedures• Rarely a factor in performance evaluation• Considered to be a distraction from primary
research and teaching focus, impedes career advancement
Legal and Financial Barriers Compliance with Bayh Dole Act, NIH guidelines, other laws Private Inurement / Private Benefit (FMV) Unrelated Business Income Tax (UBIT) Tax Exempt Bond Financing restrictions Resources to support growing patenting and business
development activities
Embryonic technologies require a plan to reduce risk, build value
Academic discovery ≠ Commercial validation A risk assessment should encompass three key areas
Scientific IP Market
Prioritization and execution of risk reduction activities -eg Animal experimentation Freedom to operate analysis Application selection and competitive review
Inventor may not have skills needed to validate or enough knowledge to select most appropriate use
Faculty nearly always under estimate time and effort required to overcome the commercialization hurdles that lie ahead.
“Genius is 1% inspiration and 99% perspiration.”
~Thomas A. Edison~Thomas A. Edison
Intellectual Property Timeline (OTM):
Invention Disclosure
Provisional Patent
Patent Application
PCT/IntlFiling
Concept Development Timeline (OED):
Viability Assessment
Preliminary Research
Preliminary Research
Funding Assistance
Application Development
Licensing or Start-Up Options
Business ModelDevelopment
Pitching to Investors
Product Development
Patent Analysis
Market Analysis
Competitive Analysis
Opportunity Incubation
Preparing for Partnership
Concept Development Timeline (OED):
Viability Assessment
Patent Analysis
Market Analysis
Competitive Analysis
• prior disclosures
• novelty, usefulness
• competing patents
• “freedom to operate”
• market size & growth
• problem/product definition
• customer demand
• feasibility/regulatory issues
• platform technology?
• barriers to competitors
• differentiation
• sustainable advantage
One page opportunity summary; identification of OED lead
Concept Development Timeline (OED):
Opportunity Incubation
Application Development
Funding Assistance
Business Plan
Development
• defined customer need
• proof of concept data• clinical development
plan with milestones
that reduce risk &
increase value• execute plan
• federal
state/local gov
• corporate
• HNW Individuals
• foundations
• internal sources
• monetization strategy
• product/service pricing
• reimbursement
• market entry strategy
• rough timeline
• rough financials
Two page executive summary; two minute “elevator pitch”, two PowerPoint slides
Helping the inventor to understand what lies ahead; facilitating communication and progress toward clinical development
Concept Development Timeline (OED):
Preparing for Partnership
Closing the DealLicensing Options
• finding management
• incubator resources
• scaling up the science
• funding
• role of the inventor
• valuation
• extraction of FMV
• projected financial needs
• projected exit strategy
•COI, COC, EOC
• identifying potential partners
• making contacts
• getting a face to face meeting
• contract facilitation
• role of the inventor
Start up Options
Two Organizations – Working Together
– Six nationally ranked schools of health sciences + top ranked bioengineering
– Over $600M research funding
– Ranked 8th in NIH funding
– Exceptional history of fostering multi-disciplinary bioengineering-clinician research teams
– Developing sophisticated intramural and extramural entrepreneurial support
Source: 2004 NIH Awards to Domestic Institutions of Higher Education
…to create a nationally and internationally renowned
center of medical excellence.
University of Pittsburgh
– $5.4B revenues– 19 hospitals + a network of care
facilities– 40,000+ employees
(Largest employer in Commonwealth of PA)
– One of the country’s fastest growing health insurance plans
– Financially healthy– Recruitment growth of 10%/year– Biotechnology venture fund– Diversified, entrepreneurial and
willing to invest in the future.
UPMC Strategic Business Initiatives and Health Ventures Investments
Overcoming Translational Research Challenges
While we have had successes, they have been largely serendipitous
Road to commercialization is long and difficult
Most faculty lack the experience and skills to drive commercialization
Internal funding for “the last mile” is often difficult to find
Resource partners exist, but are difficult for a novice to navigate
Create a Program that drives commercialization
Make the process nimbleMake the process nimble
Make access to experts Make access to experts part of the processpart of the process
Provide funding to reduce Provide funding to reduce commercial risk factorscommercial risk factors
Provide an experienced Provide an experienced navigator from start to navigator from start to finishfinish
“Life is short, science is long; opportunity is elusive.”
~Hippocrates~Hippocrates
Contact Information
Carolyn Green, Director Office of Enterprise Development, Health Sciences
University of Pittsburgh412-623-3204
www.oed.pitt.edu