Investing inHigh-ImpactGazelles thatDriveOutsizedReturns & Social Impact
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Gazelle
Proven Capital
Efficient Inventions
Startup Catalyst
Seasoned Management
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BACKGROUND
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The Problem: identifying the best inventions and furthering R&D
LicensedMove to translational researchMore funding in lab; science continuesNo funding in lab to continueWithdrawn/terminated licenseTerminated by inventor
Federally Funded Research
Invention Disclosed and Potentially Patented
Product
Translational Research,<.1%
Inability to Find and Fund Promising Inventions
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Opportunity: • 6% inventions -> $500B to $1.5T GDP Impact• 80-95% Failure Rate
Unique Challenge-Accelerator given IP & Talent Access:• Derisked IP: 21 agreements across NASA, NIH, NCI,
CDC, etc• Talent: 85+ Serial Entrepreneurs, Industry, etc.
Evolution:• Derisked IP: More Federal Labs• Disrupting the Venture architecture norms
Sieze the OPPORTUNITY
Commercialization Strategy Startups & Industry
Due Diligence – Selecting Investments & Technologies
Select the Best Federally Funded Inventions
Maximize Commercial PotentialOperators & Management Talent
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Center for Advancing Innovation—Mission
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Identify Challenge
Planning
Startup teams paired with world-class, seasoned exec level industry experts
Mentorship
Invention Selection
Tailored Training
Curriculum
Business Plan and Live Pitch
Enter Multi-Disciplinary
Teams
2 minute video with executive summary
Elevator Speech Winners and Finalists Selected
CAI’s Challenge-Accelerator
10 commercially viable inventions Form Team and Select Invention
Letter of Intent – form teams
Elevator Speech
Business Plan & Startup Launch
License & raise seed funding
12 Month Intensive & Disciplined Accelerator Training
500-1000 in multi-disciplinary teams
PartnershipAnd Licensing Agreements
STARTUPS
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01BREAST CANCER CHALLENGE11 STARTUPS
02SCALE CHALLENGE MODEL 2XNEURO STARTUP CHALLENGE
22 STARTUPS
03NANOTECH CANCERCHALLENGE13 STARTUPS04EXTEND TO THE
NASA SPACE RACE15-20 STARTUPS
06COMMERCIALIZE TOP1% OF INVENTIONS
05BOLT ON FUND
Startup Challenge Journey
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A Few of Breast Cancer & Neuro Successes
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COMPANY PROGRESS VALUATION
Powerful cancer therapies
• Won MassBIO, MassChallenge & Rice• 20 agreements with Pharma & Academia • Thiel Fellowship, Avon Foundation Grant, CASIS Grant, UK
Horizon 2020 Program, Forbes 30 under 30, TEDMED Presentation• Exclusive License to NIH invention
$20MM
Batten’s disease therapy
• OxBridge/SR One OneStart Semi-Finalist• Received orphan drug indication (FDA)• Expertise in medicine, toxicology (INDS), regulatory affairs
(RareMoon Consulting)• Recruited VP Chemistry, Merck Veteran• Exclusive Evaluation License to NIH invention
$5MM
Cancer diagnostic
• “Best Pitch”, Healthcare Innovation Pitch event (sponsored by Bridge to Cures, Inc)• Finalist, Wisconsin Governor’s Business Plan Competition; WI
Innovation Award (‘16)• Proof of Concept: Human (Completed)• Exclusive Evaluation License with the NIH
$20MM
First sale 2017
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SPACE RACE Challenge - Novel Deal FlowExample De-Risked, Capital Efficient NASA Robotics Invention
Overview:Rugged, lightweight, small, autonomous robot excavator used in sites such as
RASSOR Robotic Excavator
high-risk or inaccessible mining, search and rescue, as well as disaster response applications
Only invention to exploit extraplanetarymining industry; $200B to $1T of value in just one asteroid
Portfolio of 24K+ inventions: 100+ commercially viable inventions space inventions; 300+ precision medicine
Expanding portfolio to include patents and inventions from DoD, DoE, DARPA, Navy and other agencies
Opportunity: develop world-changing technologies, create new industries and ecosystems, drive outsized growth and returns
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New Model for Venture Philanthropy with outsized returns
Spun out 33 Companies from NIH; 1200+ Jobs Created; 19 Agreements with NIH and NASA
Prestigious Awards & Recognition HHS, NASA, White House, Wired, Nature, Huffington Post, CBS etc.
Challenge AcceleratorsSince 2012
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§ Winner of Breast Cancer Startup Challenge by the National Cancer Institute (NCI)
§ Awarded grants from Avon Foundation for Women, NASA/Center for the Advancement of Science in Space (CASIS), and the Horizon 2020 Program (UK)
§ Winner of MassChallenge & MassBio 2014 Startup Accelerators§ Winner of the Rice Business Plan Competition§ Raised seed financing, currently raising a bridge round§ Partnered with 14 pharma partners all over the world§ Partnered with 6 academic labs all over the world§ Offices in Boston and London § Closed Startup Exclusive Option License Agreement with the NCI§ Showcases: TEDMED, World ADC Summit, Engage Forum Tokyo,
Protein & Antibody Engineering Summit (Shanghai & Boston ’15)
Team Progress
MedImmune: A Brief Overview
GLOBAL BIOLOGICS RESEARCH AND DEVELOPMENT ARM OF
2,500EMPLOYEES IN THE
US AND UK
California Gaithersburg Cambridge
ROBUST PIPELINE OF 120+ BIOLOGICSIN RESEARCH & DEVELOPMENT WITH
40+ PROJECTS IN CLINICAL STAGE DEVELOPMENT
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Therapeutic Areas of Focus
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BIOLOGICS SMALL MOLECULES IMMUNOTHERAPIES PROTEIN ENGINEERING DEVICES
ONCOLOGY
RESPIRATORY,INFLAMMATION AND AUTOIMMUNITY
CARDIOVASCULAR AND METABOLIC
DISEASEINFECTIOUS DISEASE NEUROSCIENCE
CORE TAS OPPORTUNITY-DRIVEN
MedImmune R&D PipelinePHASE 1 PHASE 2 PIVOTAL/PHASE 3PHASE 2
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MEDI-565Solid Tumors
MEDI0562Solid Tumors
MEDI0639Solid Tumors
MEDI-551Diffuse B-Cell Lymphoma
MEDI-573Metastatic
Breast Cancer
DurvalumabStage III Non-Small Cell
Lung Cancer
Durvalumab3rd Line NSCLC (PD-L1+)
MEDI0680Solid Tumors
MEDI6383Solid Tumors
Durvalumab + TremelimumabSolid Tumors
MEDI3617Solid Tumors
MEDI7836Asthma
MEDI4166Diabetes/Cardiovascular
MEDI8852Influenza A Treatment
MEDI9447Solid Tumors
Durvalumab + MEDI0680Solid Tumors
Durvalumab + AZD9291Advanced EGFRmNon-Small Cell Lung Cancer
MEDI4920Primary Sjögren’sSyndrome
MEDI0382Diabetes/Obesity
MEDI-550Pandemic Influenza
ProphylaxisMEDI1814
Alzheimer’s Disease
DurvalumabSolid Tumors
MEDI-551 + RituximabHematological Malignancies
Durvalumab + MEDI6383Solid Tumors
MEDI5872Systemic Lupus Erythematosus
MEDI6012Acute Coronary Syndrome
MEDI3902Prevention of Nosocomial Pseudomonas Pneumonia
DurvalumabSolid Tumors
Durvalumab + AZD9150Squamous Cell Carcinoma of
the Head and Neck
MEDI-551Neuromyelitis Optica
AnifrolumabLupus Nephritis
MEDI9929Asthma
TralokinumabAtopic Dermatitis
MEDI7510Prevention of RSV in Older Adults
Durvalumab + AZD5069Squamous Cell Carcinoma of
the Head and Neck
Durvalumab + TremelimumabGastric Cancer
MEDI2070Crohn’s Disease
AbrilumabCrohn's Disease / Ulcerative Colitis
MavrilimumabRheumatoid Arthritis
MEDI4893Pneumonia / S. aureus
MEDI8897Passive RSV Prophylaxis
Durvalumab2nd Line SCCHN
TremelimumabMesothelioma
Durvalumab + Tremelimumab3rd Line NSCLC
AnifrolumabSystemic Lupus Erythematosus
BenralizumabSevere Asthma
TralokinumabSevere Asthma
MoxetumomabPasudotox
Hairy Cell Leukemia
Durvalmab + Tremelimumab1st Line NSCLC
BenralizumabCOPD
BrodalumabPsoriasis
ONCOLOGY
RESPIRATORY, INFLAMMATION AND AUTOIMMUNITY (RIA)CARDIOVASCULAR AND METABOLIC DISEASE (CVMD)
INFECTIOUS DISEASE (ID)NEUROSCIENCE
AnifrolumabSubcutaneousSystemic Lupus
Erythematosus
Durvalumab + IRESSANon-Small Cell Lung Cancer
MEDI1873Solid Tumors
Durvalumab+Dabrafenb+Trametinib
Melanoma
MEDI4276Solid Tumors
MEDI9197Solid Tumors
MEDI8111Trauma/Bleeding
Durvalumab + tremelimumab
Pancreatic Ductal Carcinoma
Durvalumab + tremelimumab
2nd Line SSCHN (PD-L1-)
Durvalumab + tremelimumab
1st Line Bladder Cancer
Durvalumab + tremelimumab2nd Line SSCHN
Durvalumab + tremelimumab1st Line SSCHN
Partnering and Strategy Group (since 2013): Four Groups
Classic BD•Licensing (in/ out)•M&A•Spinouts/ JVs
Biologics Strategy
•R&D strategy•All therapeutic areas/ technologies •Special areas- Asia
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Collaborations group•Governments, Universities• Focus on where we have geographical presence for ecosystem building
Government contracting•US- BARDA/ DARPA•Others
100 executed deals over the last 3 years
Company TherapeuticArea Asset Deal Type
REVLIMID, POMALYST, VIDAZA and others
Haematologicalcollaboration
CD-19 CAR T cell therapy Clinical collaboration
Data analysis technology for biomarker identification Acquisition
CRUK novel targets/ MedIphage library/ Ab engineering
Collaboration
ADXS-HPV cancer vaccine Clinical collaboration
ImmTAC moleculesPreclinical and clinical collaborations and license agreement
Antibody Drug ConjugatesAcquisition (Spirogen) / Collaboration (ADC Therapeutics)
PBD Outlicense Out-license
PBD Outlicense Out-license
Deal Examples- Oncology
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Oncology
Oncology
Oncology
Oncology
Oncology
Oncology
Oncology
Oncology
Oncology
Company TherapeuticArea Asset Deal Type
Up to 5 ion channel antigens for antibody drug discovery Collaboration
Companion diagnostic test for asthma drug Tralokinumab Collaboration
Multiple mAbsCo-development and commercializationagreement
3 projects in diabetes & obesity Research collaboration
Biologic for treatment of acute coronary syndrome In-license
rhLCAT Acquisition
EEC program Collaboration and license
3 targets – half life extension technology In-license
Deal Examples- RIA/ CVMD
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RIA
RIA
CVMD
CVMD
CVMD
RIA
CVMD
CVMD
Examples of Academic Collaboration
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I N S T I T UT I ON THERAPEUT I C AREA DESCR I P T I ON
ALL
BPD
ALL
BPD
ALL
ALL
• Joint PhD program supports joint thesis projects • Novel Entrepreneur-in-Residence program• Research collaborations in neuro, biopharmaceutical research
• 5 year Collaboration for BPD projects
• First industry sponsor for Catalyst awards• Call for proposals in MedImmune therapeutic areas• Additional strategic collaboration in RIA and Translational Science
• Collaborations in formulation science• Multiple projects with joint steering committee
• Research and education collaborations across 4 campuses• Jointly funded with UMB and Maryland Dept. of Business and Economic Development
• Multiple projects with joint steering committee• 5 year joint Biopharma PhD program to better prepare scientists for careers in biopharma
Examples of Other Collaborations
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I N S T I T UT I ON DESCR I P T I ON
• Joint projects between nearby NIST, MedI campuses• MedImmune provides monoclonal antibodies, other technology• Supported by umbrella CRADA agreement• Public – private partnership in Brazil• Each institution provides up to $2M over 5 years• Call for proposals in areas of interest to MedImmune
• Up to 30 Brazilian post-docs spend 2 years at MedImmune• Jointly funded with Brazilian government
• Joint research in immunotherapy and antibody drug conjugates• Two umbrella CRADA agreements
THERAPEUT I C AREA
BPD, ADPE
CVMD
ALL
ONCOLOGY
ADPE
• Participation in the Nanotechnology Startup Challenge in Cancer• New approach to identifying potential BD Opportunities
Benefits of Partnering with The Center for Advancing Innovation
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Access to innovations –in this case nanotechnology from the NIH database (others e.g. NASA)
New approach for BD esp. focused on early technologies/ therapeutics to leverage competition model
Support ecosystem growth of BioHealth Capital Region with local
placement of companies
Focus on commercialization by CAI- access to Gazelle Futures
Fund
1
2
3
4
Process and Status
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Phase 0 Letter of Intent
• 37 Letter of Intent Applications• 29 Teams Accepted• 7 Teams from Virginia / Maryland / DC Region• 58 Unique Universities• 510+ Participants
Phase 1 Executive Summary and Elevator Pitch
• 29 Teams Competing• 7 Teams from Virginia / Maryland / DC Region• 17Webinars Conducted from Challenge Advisors• 1 Assignment• Deliverables include Executive Summary and Elevator Pitch
Phase 2 Business Plan and
Live Pitch
•22 Teams Advance to Phase 2•6 Teams from Virginia / Maryland / DC Region•38Webinars Conducted•5 Assignments (1 Completed)•12 Serial Entrepreneur Mentors engaged with teams via CAI
MedImmune Interest in Two Inventions
Ø CAI- interaction;; Novel concept and strong collaboration – discussions began in 2015 and willingness to shape model
Ø Innovative model with access to large database of inventions (e.g. NIH and also future with NASA)
Ø Program focuses on key theme (e.g. nanotechnology) for teams to build around with input from experts/ mentors
Ø Competition based approach means best teams with best business plans progress
Ø Willingness to have companies form in MD, DC, VA was critical to support project as we look at building out the regional ecosystem
Summary
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David MorseChief, Technology Partnerships OfficeNASA Ames Research Center
June 2016
40 Years of NASA Spinoffs Bringing NASA Technology Down to Earth
National Aeronautics and Space Administration
NASA Patent Portfolio Analysis
Bringing NASA Technology Down to Earth technology.nasa.gov
Total Patents Available for Licensing as of Jan. 2016§759 Issued§372 Applications
Aeronautics98
Communications33
Electrical and Electronics52
Environment28
Health, Medicine and Biotechnology60
IT and Software 54
Instrumentation43
Manufacturing36
Materials and Coatings222
Mechanical and Fluid Systems60
Optics66
Power Generation and Storage34
Propulsion17
Robotics, Automation and Control68
Sensors194
Bringing NASA Technology Down to Earth technology.nasa.gov
NASA Software Catalog
Aeronautics30
Autonomous Systems25
Business Systems and Project Management51
Crew and Life Support20
Data Imaging and Processing98
Data Servers Processing and Handling65
Design and Integration Tools120
Electronics and Electrical Power5
Environmental Science (Earth, Air, Space, Exoplanet)71
Materials and Process5
Operations90
Propulsion27
Structures and Mechanism6
System Testing61
Vehicle Management (Space,Air,Ground)48
Total Software Available for Licensing as of Feb. 2016
48
Expanded Challenges Every YearCategory Metric
SPACE RACE2016
Nano2016
Neuro2014-2015
Breast Cancer2012-2013
Entries & Teams
Teams Accepted
54 29 71 46
Winning Teams
N/A N/A 16 12
Team Strength
# People 406+ 509+ ~1090+ 460+
University Diversity72 Unique
Universities58 Unique
Universities
120+ Universities;
96 Unique Universities
83 Total; 45 Unique
Universities
Geographic Diversity24% participating
outside US
27.5% participating outside US
19% participatingoutside US
20% participating outside US
Mentors/Judges/AdvisorsNot Completed
36Not Completed
59147+ 17
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Startup Challenge Evolution
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Investing Problems – Deal Flow & IRRs
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Annual Venture Capital Fundraising by Primary Geo Focus2008-2016 (as of May 16, 2016)
Venture Capital Median Net IRRs and Quartile Boundaries(as of June 30, 2015)
EXITS: 73% of tech companies that exited in 2014 had not raised institutional funding (up from 66%)
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Investing Problems-Time & Valuations
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SOURCE: Private Capital Markets Report, Pepperdine University, 2016
VALUATIONS: Multiples are higher than they have been in 15 years. Almost 3X as many unicorns in 2015 as 2013
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New Paradigm for Investing
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CAI & GAZELLE INVESTMENT APPROACH
EVALUATE 50K+ WORKING FED LAB INVENTIONSDUE DILIGENCE on DERISKED, CAPITAL EFFICIENT TECH
WINNING CHALLENGE/ACCELERATORCROWDSOURCE 10 TEAMS & BUSINESS PLANS – PICK BEST
LAUNCH NEWCO – OWN 100% EQUITYNO PRE-MONEY VALUATION & LOWEST COST/% EQUITY
RUN - GO TO MARKET & COMMERCIALIZEMAJORITY CONTROL; LIMIT MISTAKES W SEASONED MENTORS
EXIT – 30-65% IRRSMAJORITY SHARE THROUGH SERIES B
CURRENT INVESTOR APPROACH
FINDHUNDREDS OF MEETINGS AND PITCHES
EVALUATEONE TEAM WITH IDEA STAGE INVENTIONS
NEGOTITATE MULITLE TERM SHEETSCOMPANY VALUE UNREALISTIC; 7-12 MONTHS CLOSE*
HELP - R&D & GO TO MARKETROOKY TEAMS; LIMITED ABILITY TO ADJUST TEAM
EXIT – 6%-22% IRRS**SIGNIFICANT DILUTION; 90% FAILURE RATE
SOURCE:* Private Capital Markets Report, Pepperdine University, 2016** Prequin Global PE And VC Report 2016
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Value Proposition: Rapid Commercial Success!
Quality Strategic Deal FlowWorthy Startups with Derisked Inventions
Improved Asset Productivity
Skilled Startup TeamsStrong Talent with “Uber CEOs”
Accelerated ResultsRapid, Low-Cost Licensing
Reduced RisksTraining, Seasoned Teams, De-risked
Inventions, Aligned Ecosystems
Magnify FundsWith one Grant, 10X Impact –
Evergreen Model
R&D$Productivity
Size$of$R&D$Organization
Large&Pharma&Co’s
Optimal&Size
89%
92%
65%
21%
52%
34%
Address Presidential Memorandum
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Questions
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1. Why are the inventions on the shelf2. How do you crowdsource talent and mentors3. What companies are more appropriate for a normal VC model
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Key Takeaways
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§ YOU can do this too! We’ve built a robust, scalable, flexible platform AND have lessons learned
§ Join the RACE; be a judge; advise the challenge; mentor a team
§ GAZELLE is seeking strategic partnerships & advisors; please connect with us if interested
THANK YOU
ROSEMARIE TRUMAN, FOUNDER AND CEO
THE CENTER FOR ADVANCING [email protected]
TEXT: 202 438 2208
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