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Introduction to BioArbitrage
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Transcript of Introduction to BioArbitrage
Introduction to BioArbitrage
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What is BioArbitrage?
Who is Harrison Hayes?
Harrison Hayes and BioArbitrage
The Tools
Contact Information
Introduction to BioArbitrage
What is Arbitrage?
Arbitrage involves earning a risk-free profit without the outlay of capital.
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Arbitrage takes minimal investment for the guarantee of high return
BioArbitrage Defined
In BioArbitrage, an asset is identified where the owners undervalue the asset against the market value.
A BioArbitrage fund purchases the asset and then sells it on the open market for an immediate return.
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How it Works
Economics of BioArbitrage
Market Value
Buy Line
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Buy Asset Here
Sell Asset Here
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What is BioArbitrage?
Who is Harrison Hayes?
Harrison Hayes and BioArbitrage
The Tools
Contact Information
Introduction to BioArbitrage
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Harrison Hayes – Who Are We?
Harrison Hayes is a strategic consulting firm to the life, chemical, and material science industries. Specific areas of expertise reside in our unique and proprietary research methodologies that support strategic and tactical decision making processes for our clients.
Harrison Hayes: Timeline
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1991:
Addison Whitney founded by Bill
Smith
1995:
Addison Whitney sold to Interpublic
Group
1998:
Bill Smith re-acquires Addison
Whitney
2001:
Innovation comes to light
2001:
Innovation practice spun-off from
Addison Whitney
2007:
Addison Whitney sold to Inventive Health; Harrison
Hayes is born
Harrison Hayes: Bill Smith
Bill Smith Bio
Founder and Managing Director of Harrison Hayes, LLC, a strategic consulting firm with an emphasis on the creation of disruptive innovation products and platforms. Prior to Harrison Hayes, Bill was the Founder and CEO of Addison Whitney, which today, is the third largest branding consultancy in the world. Bill sold Addison Whitney in 1995 to Interpublic Group (NYSE:IPG) and led their Healthcare Acquisition Team for three years which was responsible for over $3 Billion in transactions. He re-acquired Addison Whitney in 1998. Bill acted in a dual role with Addison Whitney (Chairman) and Harrison Hayes until 2007.
Education B.A., Berklee College
M.A., Colorado State University
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What is BioArbitrage?
Who is Harrison Hayes?
Harrison Hayes and BioArbitrage
The Tools
Contact Information
Introduction to BioArbitrage
Harrison Hayes and BioArbitrage -Initiation
A General Partner will shape the investment charter with specific criteria and areas of investment interest.
The General Partner has the Right of First Refusal to acquire the Funds portfolio of assets.
In the event of non-acquisition, the General Partner maintains the opportunity of financial gain from the asset’s exit strategy.
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Harrison Hayes and BioArbitrage -The Option
There is typically a designated Managing Director of the Fund.
The Managing Director and Owner of the identified asset will agree on appropriate acquisition value.
The Managing Director will perform its PIPV proprietary analysis to determine that the acquisition price is less than market value.
The Fund will exercise the option to purchase the asset within a time period of 12 to 18 months.
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Harrison Hayes and BioArbitrage -The Auction
The Managing Director will market the asset in a controlled auction.
Managing Director and asset’s Owner will determine the appropriate strike price.
The asset will be auctioned to buyers who are willing to pay more than the agreed strike price.
The fund pays the owner the agreed Strike Price and retains the differential.
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Harrison Hayes and BioArbitrage -Terms
A General Partner will invest an previously agreed upon amount.
Managing Director to receive a 2.5% Annual Management Fee.
Managing Director to receive 20% of the “carry”.
Fund will be for a term of seven (7) years.
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Harrison Hayes and BioArbitrage -Why Invest?
The Fund is a key piece in building an innovation pipeline.
The Fund has the ability to deliver novel technologies and intellectual property unlike traditional methods.
This Fund will provide exposure to global investments “off the grid”.
Creates selective investments at reasonable valuations.
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What is BioArbitrage?
Who is Harrison Hayes?
Harrison Hayes and BioArbitrage
The Tools
Contact Information
Introduction to BioArbitrage
Tools for Success: Technology Scouting Technology Sourcing includes the identification of technology developments and the facilitation of the sourcing of technology.
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Technology Intelligence
Technology Scouting
Technology Management
Identification, assessment and usage of information on technological developments Acquisition, development,
storage, usage and selling of technological knowledge
Building and using a network of experts for competitive advantage
Scouts identify and assess new technologies Scouts facilitate the sourcing of
technology
Provisioning of Technology Intelligence to facilitate the Technology Management
Tools for Success: Technology Scouting
Technology Scouting Process consists of five Technology Intelligence steps plus the step of Technology Sourcing.
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Definition of search
areas
Selection of information sources and methods to
employ
Collection of data
Filtering, analyzing,
interpreting of data
Evaluation
and decision making
Usage of information
and sourcing of technology
Tools for Success: Technology Scouting
Fuzzy-front-end of Innovation
Product specification and
development
Prototype validation and
testing Market Launch
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Innovation Management
Technology Sourcing supports the external sourcing of technology and the product specification and development.
Tools for Success: Technology Scouting
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External Technology Sourcing
Storage, Internal generation and usage of
technological knowledge
Technology selling or licensing
Technology Management
Technology Sourcing supports the external sourcing of technology and the product specification and development.
Tools for Success: Technology Scouting
Factors Management
Areas Scouting Success Factors
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Defined Process
Functional interweavement
Formalized connection to R&D
Formulized connection to Marketing
Methodological interweavement
Boundary spanner capabilities
Network Size
Technological competence
Internal Network
Incentive System
IT-Support Tools
Balanced scout portfolio
Role Differentiation
Organizational
Characteristics
Characteristics of the scouts
Management of Scouting Network
Stimulation of Innovation
Facilitation of Technology
Scouting
Input for R&D projects
Triggering of new R&D projects
Triggering of new business field
Help in assessment of technology
Contact to relevant sources
Sourcing needs identified
Support in acquisition of technology
Successful acquisition of technology
Framework for Empirical Research: PLS –path analysis will be used to analyze the success factors of technology scouting and how to organize it best.
Project Planning: PLS-path analysis and in-depth case studies will be used to study organization and success factors of technology scouting.
Quantitative Interviews/Case
Studies
Qualitative Interviews
Writing of Dissertation
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Model Building
Model Valuation
In depth interviews with 10 multinational companies
Modeling a framework for research on success factors of technology scouting
Build on the Hypothesis of the framework – 50 qualitative Interviews are conducted.
In depth case studies will be conducted for six companies.
Based on the qualitative data, partial least-square path analysis is used to validate the hypothesis
The case studies are analyzed to gain knowledge of best practices
The dissertation will discuss technology scouting as of a method of technology intelligence and technology management
Tools for Success: Technology Scouting
Motivation and Research Question: Further research on Technology Scouting is needed to identify success factors and to give recommendation on how to organize it.
Motivation
Research Gap
Research Questions
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Increase in technology complexity
Globalization of R&D
Shorter product life cycles
Increasing volatility of markets
No sufficient research on ….
…success factors and
…organization of technology scouting and
...interaction with other function of the organization
What are the aims of Technology Scouting?
What are important success factors of Technology Scouting?
How should Technology Scouting be interweaved within the company?
What organizational forms of Technology Scouting have proven to be effective?
Tools for Success: Technology Scouting
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Tools for Success: Transforium™
The Transforium™ database is proprietary and unique to Harrison Hayes. The Transforium™ contains over 3,000,000 in-licensing, out-licensing, and transactional opportunities. Transforium™ provides our clients with an additional resource of “off the grid” opportunities.
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Tools for Success: PIPV™
Our Proprietary Intellectual Property Valuation (PIPV™) service utilizes a proven methodology specifically designed to:
Identify promising compounds.
Provide important market and competitive analysis.
Assess patents and their legal defensibility.
Estimate the likelihood that a specific compound will gain FDA approval.
Perform valuations on individual compounds or entire pipelines.
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Tools for Success: PIPV™ -Commercial Analysis
Harrison Hayes provides independent, third party research designed to maximize the value of identified intellectual property. Harrison Hayes can identify the compounds and targets with the greatest potential for commercial success. Our team members combine expertise from both the scientific and commercial realms of the life sciences industry.
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Tools for Success: PIPV™ -Financial Analysis
Properly valuing assets is paramount to the Fund’s success. Harrison Hayes possesses the valuation experience and domain expertise necessary to accurately assess the value of your products or technologies.
Identify market comparables
Perform quantitative analysis
Assist in development of pro forma financial statements
Calculate "burn rate" and other financial projections
Develop schedules and timelines for product development
Estimate likelihood of milestone success
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Tools for Success: PIPV™ -Legal Analysis
Harrison Hayes can evaluate the legal status of your identified intellectual property.
Investigate all relevant patent initiatives
Assess legal defensibility
Determine overall strength and scope of intellectual property rights
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Tools for Success: PIPV™ -Feasibility Analysis
Harrison Hayes will render an opinion on the feasibility of specific opportunities.
Assess experience and track record of management team
Evaluate development progress and timelines
Perform competitive and substitute analysis
Analyze potential exit strategies
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What is BioArbitrage?
Who is Harrison Hayes?
Harrison Hayes and BioArbitrage
The Tools
Contact Information
BioArbitrage