Minding the Demand: New Paradigms in Academic Technology ... · Interaction with global thought...
Transcript of Minding the Demand: New Paradigms in Academic Technology ... · Interaction with global thought...
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Minding the Demand: Minding the Demand: New Paradigms in Academic Technology New Paradigms in Academic Technology Commercialization and LicensingCommercialization and Licensing
Borys ChaburskyBorys ChaburskyPresident of SHI ConsultingPresident of SHI Consulting
February 14February 14 thth , 2007, 2007
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Who we are and what we do at SHIWho we are and what we do at SHI
How does commercialization translate innovation into economic growth?
What about life science and technology transfer?
Why is technology transfer not delivering?
What can you do?... Models for technology transfer
What are the opportunities for technology transfer in Japan?
Take home messages
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Creation and interim management of life sciences companies, multi-stakeholder partnerships and international consortia.
Completion of 300 life science assignments for over 150 clients in North America, Europe and Asia-Pacific over the past 6 years.
Development of business cases and implementation plans that have helped raise close to $300 million in financing from private- and public-sector.
Interaction with global thought leaders and decision-makers across the life sciences space.
Creation and/or facilitation of more than 40 public-private partnerships in biomedical research, infrastructure development and global health.
Hig
hlig
hts
of O
ur A
chie
vem
ents
SHI Is a Management Consultancy Specializing in the Life ScienceSHI Is a Management Consultancy Specializing in the Life Science ss
Increasing presence in big pharma, having worked with 5 of the world’s top 10 pharmaceutical companies.
Global presence in life sciences economic development/capacity-building, including a successful engagement in Mexico, Brazil & Asia.
SHI is a globallySHI is a globally --recognized management strategy consultancy speciali zing in recognized management strategy consultancy speciali zing in innovationinnovation --driven life sciences. We offer our clients in indus try, governmedriven life sciences. We offer our clients in indus try, governme nt, academia nt, academia and the notand the not --forfor --profit sector actionable strategies focused on impl ementationprofit sector actionable strategies focused on impl ementation
Asia is a key growth area for SHI where there are ample opportunities to bridge and transfer technologies from North America and the EU.
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SHI Also Comprises of a Broader Portfolio of Interc onnected CompSHI Also Comprises of a Broader Portfolio of Interc onnected Comp aniesanies
SHI Group combines multidisciplinary expertise and perspectives SHI Group combines multidisciplinary expertise and perspectives through an through an interlinked group of companiesinterlinked group of companies
Strategy through implementation
� Consulting services
� Transactional services
� Operational services
SHIConsulting
SHIConsulting
PortfolioCompany/
Client
PortfolioCompany/
Client
SHI LinkSHI Link
SHICapital
SHICapital
SHI Economic
Development
SHI Infrastructure
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Who we are and what we do at SHI
How does commercialization translate innovation int o economic grHow does commercialization translate innovation int o economic gr owth?owth?
What about life science and technology transfer?
Why is technology transfer not delivering?
What do you do?... Models for technology transfer
What are the opportunities for technology transfer in Japan?
Take home messages
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Technological Innovation Impact Economic Growth and ProsperityTechnological Innovation Impact Economic Growth and Prosperity
Size of bubbles represent relative per capita GDP (2002); numbers within bubbles indicate growth (%) of per capita GDP from 1998 to 2002. Source: World Economic Forum, 2005, OECD, 2005 and United Nations, 2005.
Hum
an D
evel
opm
ent I
ndex
(H
DI,
2003
)
Growth Competitive Index (2005)
High/LowHigh/Low
Low/LowLow/Low
High/HighHigh/High
Low/HighLow/High
3.5 6.0
US
Sweden
Australia
Canada14
14Finland
16
17
21
Portugal20 Korea (Rep)
39France16
Japan
TurkeyMexico
14-1
0.75
1.00
It is no surprise that the most competitive/innovat ive economiesIt is no surprise that the most competitive/innovat ive economies in the in the world have the highest quality of life world have the highest quality of life
2
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However, Investment in Innovation Does not Lead to Prosperity PaHowever, Investment in Innovation Does not Lead to Prosperity Pa ssivelyssively
Example: Canada has a higher proportion of tertiary education atExample: Canada has a higher proportion of tertiary education at tainment tainment than Irelandthan Ireland ……
05
1015202530354045
Hunga
ryAus
tria
Irelan
d
United
King
dom
Austra
liaSwed
enJa
pan
United
Sta
tes
Canad
aP
ropo
rtio
n
Tertiary Education Attainment forAge Group 25-64 (2004)Unemployment Rate of UniversityGraduates (2003)
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Investment in Innovation Does not Lead to Prosperit y PassivelyInvestment in Innovation Does not Lead to Prosperit y Passively
0
10
20
30
40
50
60
Germ
any
Spain
Irelan
dCan
ada
Franc
e
Sha
re o
f Sal
es (
%)
0
1
2
3
4
5
6
7
WE
F In
dex
Innovative Products
WEF Ranking
……but this is not matched in their share of sales for innovative pbut this is not matched in their share of sales for innovative p roducts. roducts.
What is the missing link?
Commercialization!Commercialization!
It is evident that having a greater supply of innov ation potential is not sufficient…
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A Question of Balancing Market Forces: Supply of Re search and DeA Question of Balancing Market Forces: Supply of Re search and De mand for products mand for products
Converting innovation into prosperity requires an a ctive Converting innovation into prosperity requires an a ctive alignmentalignment of:of:
Human Talent Human Talent ●● Research Research ●● CapitalCapital
Aligning the market forces is an active process that requires political will and dedicated resources
“Innovators… … make ideas … … a reality.”
TalentTalent ProsperityProsperity
Angel
EntrepreneurshipEntrepreneurship
ResearchResearch
Early-stageVenture
IPO
Late-stageVenture
Scientists
ManagersEntrepreneurs
Engineers
Investors
InnovatorsCompetitiveness
Productivity
ideasideas
opportunitiesopportunities
innovationsinnovations
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Who we are and what we do at SHI
How does commercialization translate innovation into economic growth?
What about life science and technology transfer?What about life science and technology transfer?
Why is technology transfer not delivering?
What do you do?... Models for technology transfer
What are the opportunities for technology transfer in Japan?
Take home messages
Life Science and Biotechnologies are one of the most strategic industries for driving future economic gr owth
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Technology Transfer in Life Science: A Unique Indu stry!Technology Transfer in Life Science: A Unique Indu stry!
Life Science is one of the fastest growing sectors of Life Science is one of the fastest growing sectors of the economythe economy
Latest advances in molecular biology (including the sequencing of the human genome) and the convergence of information technology with life science are revolutionizing medicine
The biotech industry is an important economic driver
$6.4 B
4,171*
464
$0.82 B
Japan
$13.8 B
7,440
470
$1.7 B
Canada
$5.0 B
6,393
226
$1.0 B
Australia
$25.6 B$458 BMarket Capitalization
32,470146,100Number of Employees
1,8781,473Number of Companies
$7.5 B$59.5 BSales/ Revenue
EuropeUSA
*Japan: Public companies only Source: Burrill
In the US alone, US$35 Billion 1 was raised for biotech ventures in 2005.
1 Source: Burrill Quarterly Report
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Technology Transfer in Life Science: A Unique Indu stry!Technology Transfer in Life Science: A Unique Indu stry!
While top biotechnology firms thrive, the biggest While top biotechnology firms thrive, the biggest pharmaceutical players are enduring diminishing ret urnspharmaceutical players are enduring diminishing ret urns
IBM Life Science Solutions; as cited in Burrill & Company, Laguna Niguel 2005
5 Year Annualized Total Shareholder Returns (TSR)
% TSR to Mar 98 % TSR to Sept 02
5 Year Annualized Total Shareholder Returns (TSR)
% TSR to Mar 98 % TSR to Sept 02
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Technology Transfer in Life Science: A Unique Indu stry!Technology Transfer in Life Science: A Unique Indu stry!
The decreasing returns of top The decreasing returns of top pharmaspharmas , due to loss of patent , due to loss of patent protection for key products and a long regulatory a pproval protection for key products and a long regulatory a pproval process, creates an attractive environment for lice nsingprocess, creates an attractive environment for lice nsing
Average Phase 1 total deal terms increased from $25 million to over $120 million between 2000 and 2004
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Licensing SuccessLicensing Success
Scripps Institute - Pfizer research pact
Under this agreement…
• Pfizer pays Scripps Research Institute $20 million a year for 5 years for research endeavours
• In exchange, Pfizer benefits from the first right t o license for new discoveries coming from Scripps Research Instit ute
• Scripps Institute stand to earn milestone payments and royalties on any approved products
Industry Academiafinancing
• Innovative technologies
•Product development
• Royalties, milestones
• Reinvestment in research
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Technology Transfer in Life Science: A Unique Indu stry!Technology Transfer in Life Science: A Unique Indu stry!
AndAnd ……
Average pre-clinical total deal terms increased from $30 million to over $80 million between 2000 and 2004
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Technology Transfer in Life Science: A Unique Indu stry!Technology Transfer in Life Science: A Unique Indu stry!
Even moreEven more ……
Average discovery total deal terms increased from $30 million to over $75 million between 2000 and 2004
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Technology Transfer Offices Must Deal with Though M arket RealitiTechnology Transfer Offices Must Deal with Though M arket Realiti es es
DiscoveryProof-of-concept
ProductDevelopment
Market-readyProduct
MarketedInnovation
Rel
ativ
e Le
vel o
f Inv
estm
ent
Then, why do investors resent investing in early te chnology? Then, why do investors resent investing in early te chnology?
This is the battlefield of academic technology transfer
offices
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Technology Transfer in Life Science: A Unique Indu stry!Technology Transfer in Life Science: A Unique Indu stry!
For traditional biopharmaceuticals, it takes 10,000 leads to get 1 FDA approved product
Developing a new compound costs on average - $800M and takes 10 to 15 years
Life scienceLife science ’’s ventures are high risk endeavorss ventures are high risk endeavors ……
Drug discovery needs to use sophisticated risk mana gement techniques and undertake a portfolio management app roach
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Who we are and what we do at SHI
How does commercialization translate innovation into economic growth?
What about life science and technology transfer?
Why is technology transfer not delivering?Why is technology transfer not delivering?
What do you do?... Models for technology transfer
What are the opportunities for technology transfer in Japan?
Take home messages
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Why is Technology Transfer not Delivering? Why is Technology Transfer not Delivering?
If the science is good it will sell by itself
There are Myths about Technology TransferThere are Myths about Technology Transfer
Discoveries need to be communicated and sold to potential investors/partners
Demystifying Technology
Transfer
MYTHS:
Innovation comes first and their application second
Technological Transfer is a transactional function
REALITY:
Successful innovations are driven by market demand
Technology Transfer is a strategic function
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The need to focus investments on a successful few in the presence of a multitude of innovation possibilities
The need to relatively rank the commercialization value of different applications within an organization’s IP portfolio
The need to define the best commercialization path for a particular technology
Technology Transfer as a Strategic FunctionTechnology Transfer as a Strategic Function
Technology transfer offices need to take a pro-acti ve approach to commercialization ●
Moving from a solely PUSH approach to a PULL approa ch that is market-driven
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Underlying Vision / Communication:
Clusters require communication and coordination around a consistent investment and market access strategy to support company creation, attraction, and retention.
Underlying Vision / Communication:
Clusters require communication and coordination around a consistent investment and market access strategy to support company creation, attraction, and retention.
Success requires a well balanced approach among all factorsSuccess requires a well balanced approach among all factors
PUSHPUSH--PULL Innovation Model PULL Innovation Model
Similar to a traditional value chain, the innovatio n developmentSimilar to a traditional value chain, the innovatio n development cycle has valuecycle has value --adding activities that lead to innovation based pro ducts and seradding activities that lead to innovation based pro ducts and ser vices.vices.
Market Conditions
PULLPULLPULL
Product and Business
Development
Manufacturing and Support Industries
Market Access
Market Conditions – PULL:Receptor capacity (i.e. established industry players) pull new technology through development, to production, to market, with the support of business development and public private partnerships along the way.
Market Conditions – PULL:Receptor capacity (i.e. established industry players) pull new technology through development, to production, to market, with the support of business development and public private partnerships along the way.
KnowledgeCreation
PUSHPUSHPUSHFundamentalResearch and
Discovery
Technology CreationSeed Funding
Company Formation
Financing andTechnology
Development
Knowledge Creation – PUSH:
Fundamental research and discovery, produce technology, supported with seed funding, and transferred to a commercial entity for additional financing and development.
Knowledge Creation – PUSH:
Fundamental research and discovery, produce technology, supported with seed funding, and transferred to a commercial entity for additional financing and development.
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Who we are and what we do at SHI
How does commercialization translate innovation into economic growth?
What about life science and technology transfer?
Why is technology transfer not delivering?
What do you do?... Models for technology transferWhat do you do?... Models for technology transfer
What are the opportunities for technology transfer in Japan?
Take home messages
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Effective Technology Commercialization Requires an Integrated ApEffective Technology Commercialization Requires an Integrated Ap proachproach
Licensing toIndustry Spin-off
Com
paniesInno
vatio
n
Management& Tech Transfer
Capital
Part
ners
hip
Opp
ortu
nitie
s
Licensing to Industry
Spin-off Companies
Partnership Opportunities
Management, Opportunity Evaluation &
Technology Transfer
Capital Sourcing
Innovation Strategy
How do you bridge the gap between internal capabilities and external opportunities?
Commercialization and licensing successes require a 360Commercialization and licensing successes require a 360°° approach, as well as approach, as well as diversity and flexibility diversity and flexibility
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Technology Commercialization Is a MultiTechnology Commercialization Is a Multi --Sector CollaborationSector Collaboration
BRING•Scientific expertise and insight
•Innovative technologies and discoveries
BRING•Scientific expertise and insight
•Innovative technologies and discoveries
BRING•Business perspective on innovative ideas
•Strategic direction
BRING•Business perspective on innovative ideas
•Strategic direction
BRING•Investment in research, infrastructure, talent
•Policy development
BRING•Investment in research, infrastructure, talent
•Policy development
BRING•Perspective on consumer needs
•Human capital
BRING•Perspective on consumer needs
•Human capital
ACADEMIAACADEMIA
GOVERNMENTGOVERNMENT
INDUSTRYINDUSTRY
NON-PROFIT ORGANIZATIONS
NON-PROFIT ORGANIZATIONS
GAIN•Social and economic prosperity
GAIN•Social and economic prosperity
GAIN•Access to resources•Strategic directions•Financial rewards
GAIN•Access to resources•Strategic directions•Financial rewards
GAIN•Commercialization opportunities
•Insight and influence on future policy
GAIN•Commercialization opportunities
•Insight and influence on future policy
GAIN•Increased ability to meet the needs of stakeholders
GAIN•Increased ability to meet the needs of stakeholders
Optimized Commercialization
System
●
Leverage Talent
Research
Capital
Commercialization is a priority in which all sector s of the econCommercialization is a priority in which all sector s of the econ omy omy ––industry, government, academia and fourthindustry, government, academia and fourth --pillar organizations pillar organizations –– have have an important stakean important stake
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TorontoToronto ’’s s BioDiscoveryBioDiscovery Regional Innovation Network actively encourages Regional Innovation Network actively encourages commercial involvement in academic research commercial involvement in academic research
BioBio --DiscoveryDiscovery
CentreCentre
Case Study: Technology Transfer Model Case Study: Technology Transfer Model
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Case Study: Technology Transfer Model Case Study: Technology Transfer Model
The development of an interdependent research and c ommercializatThe development of an interdependent research and c ommercializat ion ion strategic plan by SHI for a leading transport medic ine organizatstrategic plan by SHI for a leading transport medic ine organizat ion.ion.
CHALLENGE
• Identify R&D focus
• Capitalize on R&D for revenue creation
• Create an organizational infrastructure to sustain research and commercialization as a single innovation strategy
IMPACT
Solidify the organization’s position as leaders in transport medicine both in terms of the quality of patient care and as an innovator in the industry
RESEARCH & DEVELOPMENT
• Pursue research targets aligned with market needs
• Establish research partnerships
COMMERCIALIZATION/ TECH TRANSFER
IP
Revenue
• Prioritize near-term commercialization targets for quick wins
• Stepwise creation of tech transfer organizational infrastructureR&D
Advisory Board
•Externally focused
•Pulse on market
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Case Study: Technology Transfer Model Case Study: Technology Transfer Model
The evaluation by SHI of the commercialization pote ntialThe evaluation by SHI of the commercialization pote ntial of the cancerof the cancer --related IP portfolio at a major US academic institu tion related IP portfolio at a major US academic institu tion
High
Hig
h
Sci
ence
& T
echn
olog
y
Market Attractiveness
1
2
3
456
7
8
9
IPIP
Technology Assessment & Prioritization
Technologies were evaluated on their technical merit and commercial potential
Large IP portfolio•Enable go/ no-go decision making to streamline IP portfolio
•Enable optimum allocation of commercialization efforts
Accelerated and Targeted
Commercialization
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Who we are and what we do at SHI
How does commercialization translate innovation into economic growth?
What about life science and technology transfer?
Why is technology transfer not delivering?
What do you do?... Models for technology transfer
What are the opportunities for technology transfer in Japan?What are the opportunities for technology transfer in Japan?
Take home messages
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Opportunities for Technology Transfer in Japan Opportunities for Technology Transfer in Japan
Japan is the second largest biopharmaceutical market in the world (projected to reach $230B by 2010 )
Number of Alliances by Japanese pharmas
66
68
86
0 20 40 60 80 100
2003
2004
2005
+26%
The Emerging Japanese The Emerging Japanese biotechsbiotechs are the burgeoning recipients are the burgeoning recipients of commercialized academic innovationof commercialized academic innovation
The Japanese biopharmaindustry is undergoing awave of alliances
Japanese biopharmaceutical companies are partnering, combining, and developing further international presence
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Opportunities for Technology Transfer in Japan Opportunities for Technology Transfer in Japan
Deregulation in the Japanese environment will increase entrepreneurship in Japanese academic institutions
30% of interviewed Japanese VCs cited healthcare as an area of interest for the future. They too will seek industry-grade dealings
The Japanese environment dynamics are likely to inc rease The Japanese environment dynamics are likely to inc rease demand for commercialized academic innovation by bo th local demand for commercialized academic innovation by bo th local and nonand non --Japanese companies Japanese companies
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Who we are and what we do at SHI
How does commercialization translate innovation into economic growth?
What about life science and technology transfer?
Why is technology transfer not delivering?
What do you do?... Models for technology transfer
What are the opportunities for technology transfer in Japan?
Take home messagesTake home messages
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Take Home Messages Take Home Messages
ActionsActions and pro-active commercialization is needed to translate Innovation into ProsperityInnovation into Prosperity
111
222
333
444
555
666
777
Effective Commercialization/licensing is a matter of Balancing Balancing Market Forces: Supply and DemandMarket Forces: Supply and Demand
Technology Transfer Offices must move from a PUSH approach only to a PULL approach that is marketPULL approach that is market --drivendriven
Effective Technology Commercialization Requires an Integrated Integrated ApproachApproach
Technology Commercialization Is a MultiMulti --Sector CollaborationSector Collaboration
The emerging Japanese The emerging Japanese biotechsbiotechs are a burgeoning recipient for commercialized academic innovation
The Japanese environment dynamics are likely to increase demand for increase demand for academic innovations academic innovations by both local and non-Japanese companies
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Take Home Message Take Home Message
Making innovation a creator of prosperity requires a ProMaking innovation a creator of prosperity requires a Pro --ACTIVE ACTIVE commercialization processcommercialization process
Pro
sper
ity
Growth Competitive Index
Commercializatio
n &
Licensing
Proactive approachesProactive approaches
Integrated systemsIntegrated systemsDemand PULL Demand PULL
Challenging the myths Challenging the myths
Seize the growing Seize the growing opportunities in opportunities in
Japan Japan
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310310--162 Cumberland Street 162 Cumberland Street || Toronto, Ontario Toronto, Ontario || Canada Canada M5R 3N5M5R 3N5TT 416.236.1054 416.236.1054 FF 416.236.2801 416.236.2801 wwwwww .shiconsulting.com.shiconsulting.com
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Licensing Success Licensing Success
• MIT Technology Licensing Office (2006 fiscal year)
� 121 U.S. patents issued, 97 licenses granted
� $42.3 M in royalty payments from licensing deals
� Success stories include licensing deals with major biotechnology/ pharmaceutical companies- Promega and Genzyme.
• Reastasis- A New Treatment for Dry Eye
� Technology developed by University of Georgia for veterinary use(1990)
� Licensed by KB Vision Inc. for further development
� FDA approval for human use received in 2003
� To date, generated more than $28 million in licensing royalties from veterinary and human application of this technology