Professional Documents
Culture Documents
Technology development ?
or
Technology commercialization ?
Answer
Biotech companies are specialists in
Technology development
Big Pharma or Big Medical Device companies
are specialists in technology
commercialization (Marketing & Sales)
Biotechnology is the technology driver , but
every New Technology must create additional
value
Commercialization
stages
500
450
400
350
300
250
200
150
100
50
0
deal price
Investment
II
III
IV
Commercialization
stages
10
9
8
7
6
risk for purchaser
4
3
2
1
0
1
The risk of development and failure is also increasingOnly 12% of compounds entering the clinical phase
will make it to the market
Valid IP
Proper Product development
Early Business development
Regulatory check
Cooperate versus compete decision
Deal structure
IP Management
Build up strong IP
The freedom to operate (make, use or
sell products)
The provision of a "technology fence"
Controlled access to a market niche
Licensing opportunities
IP
The power of licensing
Quickly capitalize on new technologies
Using technology for competitive advantage
Global business participation
Maximizing profits from deals
From R&D to
Commercialization:
clinical
phase
IV
commercialization
registration
/approval
IP patents,
etc.
Idea
clinic
chemical preclinical phase I
synthesis
clinical
phase III
clinic
phase II
Parallel Commercialization
Pathway
Who is translating R&D results to
commercialization ?
Invention
Market
What is the
market?
Commercialization
roadmap
IP
Scientific product development
Business Development
You can start to commercialize at every
timepoint in product development, If you take
into account the critical components for
commercialization success
& IP
Management
what management
capabilities are
available and what
will be needed
Market
Financials
Commercialization
Roadmap
Do you have strong IP ?
Where are you in product development ?
What are the market needs ? competition ?
other innovators ? Business Development
Timelines for development
What are the regulatory requirements ?
IP protection
Manpower
Manufacturing
Market
research
Business
Development
License
Agreements
Technology &
Science
Market
Management
Financials
Regulatory
Approval
Timelines
Strategic or
distribution
partners
Fundraising
Company
valuation
Commercialization
Options
Compete or cooperate
Distribution vs. licensing out
Compete or cooperate
Return on investment tends to be higher for a
cooperation strategy than a competition
strategy when one or more of three
conditions exists for the start-up company.
These conditions are the following:
The firm has a high degree of control over
its intellectual property rights
The firm enjoys low deal transaction costs
There is a high sunk cost requirement for
the firm to compete in its industry
Compete or cooperate
Start-ups benefit more from cooperation strategies
than compete strategies when they:
possess strong intellectual property rights,
utilize brokers to facilitate trade,
leverage the assets of established firms to
commercialize their innovation.
In these situations, a start-up can earn higher returns
by acting as an upstream supplier of innovation rather
than as a horizontal innovation-oriented competitor. In
other words, by participating in the market for ideas
rather than in the market for products, new companies
can make the best use of their innovations.
Licensing-out
How Much - Setting the Royalty Rate
There is no such thing as a typical or standard royalty rate.
Licensor : 20% of the total benefits , licensee: 80% of the
profits
Royalty result: 2% to 10% of gross sales.
Major factors include:
The inherent quality of the technology,
The market potential of the technology,
The fit with the licensee's business,
The ability to assure the licensee protection for unauthorized
use of the technology
The risk involved in the agreement (technology, business etc.).
Commercialization &
Development Roadmap
Build strong IP
Start proper product development planning
Execute product development based on
market needs
regulatory requirements