Z-CUBE: THE NEXT GENERATION OF LIFE SCIENCES INVESTING “ The link between venture capital and research: synergies and coll...
Background Themes <ul><ul><li>Drug industry R&D expenditures greatly outpacing US NCE approvals </li></ul></ul><ul><ul><li...
The Primary Problem: failure to develop therapeutics addressing unmet needs <ul><li>High candidate drug failure rate </l...
Lengthening Clinical Times Have Increased Total Times for Approval of New Biological Drugs Tufts Outlook 2003
Current scenario: the pharma innovation gap Source: Burrill & Co 2006 The increasing R&D costs and the reduced R&D efficie...
Opportunities and challenges for biotech companies
Number of New Biotech — Big Pharma Collaborations 1993-2005 69 165 180 228 224 229 373 425 411 384 117 502 517 Source: Bi...
Selected Biotech Partnering in the Last 12 Months <ul><li>Biogen/Protein Design Labs $800M </li></ul><ul><li>Alnylam/Nova...
Selected Biotech M&A in the Last 12 Months <ul><li>Medicis/Inamed $2.8B </li></ul><ul><li>Solvay/Fournier Pharma $2.1B </...
The VC gap… The challenge of early stage financing
<ul><ul><li>In spite of the increase in total biotech VC funding seed investments are down </li></ul></ul>Total Biotech VC...
Seed investments remain low… … attrition rate in early financing rounds is high with less than 50% of companies progressin...
Fewer deals at research stage Source: DataMonitor, 2006, only lifescience therapeutics
The “equity gap” * University Challenge Seed Funds Mainstream VC Tech Specialists Regional VC Angels UCSF* Grants and Matc...
The challenges <ul><ul><li>Biotech companies start attracting VC capitals at a more advanced development stage than before...
The VC perspective <ul><li>Early stage investing is far from an exact science </li></ul><ul><li>Early-stage companies are...
Filling the gap… <ul><ul><li>Venture-backed companies need: </li></ul></ul><ul><ul><ul><li>greater degree of R & D and bu...
Z-Cube: the venture capital arm of Zambon Group <ul><li>Focus : life sciences and biopharmaceuticals </li></ul><ul><li>Mai...
THE POTENTIAL OF YOUR RESEARCH, CUBED…..
Z-Cube srl: An Entreprenurial Corporate Incubator <ul><ul><li>Subsidiary of the Zambon Group focused on identifying and su...
Z-CUBE MANAGEMENT TEAM Z-Cube integrates competencies for NewCo success <ul><li>Zambon Group SpA </li></ul><ul><li>Competi...
Z-Cube: from Application to NewCo yes yes Business Plan Project Coordinator Z-Cube and Zambon Group team 0 1 3 12 Screeni...
Realizing a Project’s Potential CAPITAL TO GET UNDERWAY EXPERT SUPPORT GROWTH CAPITAL AND RELATIONSHIP NETWORK
The Z-Cube Process for Start-up Companies <ul><li>Z-CUBE will fund selected projects with a preliminary investment to ...
Target for incubation start The proponent: <ul><li>Dynamic researchers/team of scientists with a track record of publicati...
<ul><ul><li>Company created/consolidated </li></ul></ul><ul><ul><li>Minimal staff on board or committed (at least CEO) </l...
<ul><li>Executive Summary </li></ul><ul><li>About 1000 projects screened </li></ul><ul><li>8 projects selected for sponsor...
Z-Cube: Adding value to create business opportunities <ul><li>Experienced industrial team with on average 20 years experti...
A unique approach and an efficacious response to the challenging scenario in life science investing Filling the gap… * Un...
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Pres_Semeraro_INSME-UNIDO_2006.ppt

Published on: Mar 4, 2016
Published in: Economy & Finance      Business      
Source: www.slideshare.net


Transcripts - Pres_Semeraro_INSME-UNIDO_2006.ppt

  • 1. Z-CUBE: THE NEXT GENERATION OF LIFE SCIENCES INVESTING “ The link between venture capital and research: synergies and collaboration ” – INSME-UNIDO Rome, november 30, 2006 Claudio Semeraro – CEO Z-Cube srl
  • 2. Background Themes <ul><ul><li>Drug industry R&D expenditures greatly outpacing US NCE approvals </li></ul></ul><ul><ul><li>Number of New Biotech — Big Pharma Collaborations continuously increases </li></ul></ul><ul><ul><li>Biotech companies start to attract VC capitals at a more advanced development stage than before </li></ul></ul><ul><ul><li>Significant funding and expertise “gaps” exist for early-stage life science companies </li></ul></ul><ul><ul><li>Public capital market thresholds for liquidity in both North America and the EU continue to rise </li></ul></ul><ul><ul><li>These factors demand a unique approach to life sciences investing… </li></ul></ul>
  • 3. The Primary Problem: failure to develop therapeutics addressing unmet needs <ul><li>High candidate drug failure rate </li></ul><ul><ul><li><20% of drugs entering human testing get approved </li></ul></ul><ul><ul><li>a drug entering phase I in 2000 less likely to reach market than one entering Phase I in 1985 </li></ul></ul><ul><ul><li>~50% of phase 3 studies fail due to lack of efficacy </li></ul></ul>Source: FDA clinical productivity, ACPS Meeting, October 19, 2004 Rosemberg A.
  • 4. Lengthening Clinical Times Have Increased Total Times for Approval of New Biological Drugs Tufts Outlook 2003
  • 5. Current scenario: the pharma innovation gap Source: Burrill & Co 2006 The increasing R&D costs and the reduced R&D efficiency increase challenges and opportunities for biotech companies
  • 6. Opportunities and challenges for biotech companies
  • 7. Number of New Biotech — Big Pharma Collaborations 1993-2005 69 165 180 228 224 229 373 425 411 384 117 502 517 Source: BioWorld Financial Watch, American Health Consultants, BioCentury, all biotech 0 50 100 150 200 250 300 350 400 450 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
  • 8. Selected Biotech Partnering in the Last 12 Months <ul><li>Biogen/Protein Design Labs $800M </li></ul><ul><li>Alnylam/Novartis $700M </li></ul><ul><li>Medarex/BMS $530M </li></ul><ul><li>Pfizer/Coley $505M </li></ul><ul><li>Shire/New River $500M </li></ul><ul><li>Plexxikon/Wyeth $372M </li></ul><ul><li>Nastech/Merck $341M </li></ul><ul><li>Avanir/Astra Zeneca $340M </li></ul><ul><li>Cilag/Basilea Pharma $308M </li></ul><ul><li>Pharmasset/Roche $300M </li></ul><ul><li>CancerVax/Serono $278M </li></ul><ul><li>Astex/AstraZeneca $275M </li></ul><ul><li>GSK/Theravance $252M </li></ul><ul><li>Sirna/Allergan $250M </li></ul><ul><li>GenMab/Serono $215M </li></ul><ul><li>Sucampo/Takeda $210M </li></ul><ul><li>Novartis/Avanir $210M </li></ul>Source: Burrill &Co, 2006, all biotech
  • 9. Selected Biotech M&A in the Last 12 Months <ul><li>Medicis/Inamed $2.8B </li></ul><ul><li>Solvay/Fournier Pharma $2.1B </li></ul><ul><li>Pfizer/Vicuron $1.7B </li></ul><ul><li>Shire/TKT $1.6B </li></ul><ul><li>GSK/ID Biomedical $1.4B </li></ul><ul><li>Meda/Viatris $1.0B </li></ul><ul><li>OSI/Eyetech $0.9B </li></ul><ul><li>Genzyme/BoneCare $0.6B </li></ul><ul><li>Danisco/Genencor $0.6B </li></ul><ul><li>Pfizer/Angiosyn $0.5B </li></ul><ul><li>Protein Design Labs/ESP Pharma $0.5B </li></ul><ul><li>GSK/Corixa $0.4B </li></ul>Source: Burrill &Co, 2006, all biotech
  • 10. The VC gap… The challenge of early stage financing
  • 11. <ul><ul><li>In spite of the increase in total biotech VC funding seed investments are down </li></ul></ul>Total Biotech VC Funding Sources for R&D costs: Pharmaceutical R&D Spending: Pharmaceutical Research and Manufacturers of America, PhRNA Annual Membership Survey, 2003. NIH Budget: National Institutes of Health, Office of Budget, History of Congressional Appropriations, 1992-2003, www.nih.gov 2003
  • 12. Seed investments remain low… … attrition rate in early financing rounds is high with less than 50% of companies progressing to the following round. Attrition in later stages could be influenced by exits Source: DataMonitor, 2006, only lifescience therapeutics
  • 13. Fewer deals at research stage Source: DataMonitor, 2006, only lifescience therapeutics
  • 14. The “equity gap” * University Challenge Seed Funds Mainstream VC Tech Specialists Regional VC Angels UCSF* Grants and Matched Equity 0 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 Funding range £ x 000 Start-up and seed Development capital Growth capital Equity gap Source: Modified from European Biopharmaceutical Review, Spring 2006 Preclinical/clinical development Tech. Platform Hits Leads/Drug candidate
  • 15. The challenges <ul><ul><li>Biotech companies start attracting VC capitals at a more advanced development stage than before </li></ul></ul><ul><ul><li>Seed investments in early stage companies remain low </li></ul></ul><ul><ul><li>Early stage companies increasingly need industrial know-how to transform academic innovation into a winning industrial project </li></ul></ul><ul><ul><li>Increasing need of industrial management </li></ul></ul><ul><ul><li>Marketable, VC-grade Business Plan </li></ul></ul><ul><ul><li>Significant funding and expertise “gaps” exist for early-stage life science companies </li></ul></ul>
  • 16. The VC perspective <ul><li>Early stage investing is far from an exact science </li></ul><ul><li>Early-stage companies are often comprised of little more than an entrepreneur with an idea </li></ul><ul><li>Valuations at the “seed stage” are generally driven by factors that by their nature are subjective </li></ul><ul><li>These include: </li></ul><ul><ul><li>appraisals of the CEO and management team </li></ul></ul><ul><ul><li>novelty of the value proposition </li></ul></ul><ul><ul><li>evaluation of intellectual property </li></ul></ul><ul><ul><li>expected time-to-market </li></ul></ul><ul><ul><li>expected path to profitability </li></ul></ul><ul><ul><li>estimated capital needs and burn rate </li></ul></ul><ul><ul><li>syndicate risk </li></ul></ul><ul><li>Source: Understanding Valuation: A Venture Investor’s Perspective </li></ul><ul><ul><li>A. Dana Callow, Jr. Managing General Partner, Boston Millennia Partners </li></ul></ul><ul><ul><li>Michael Larsen, Senior Associate, Life Sciences </li></ul></ul>
  • 17. Filling the gap… <ul><ul><li>Venture-backed companies need: </li></ul></ul><ul><ul><ul><li>greater degree of R & D and business development expertise than ever before </li></ul></ul></ul><ul><ul><ul><li>easier access to seed financing to progress at a stage attractive for VC capitals </li></ul></ul></ul><ul><ul><li>Z-Cube brings both sets of skills with a pharma company level of competency </li></ul></ul>
  • 18. Z-Cube: the venture capital arm of Zambon Group <ul><li>Focus : life sciences and biopharmaceuticals </li></ul><ul><li>Main therapeutic areas : respiratory, pain and inflammation, allergy and immunology, anti-infectives </li></ul><ul><li>Business activity </li></ul><ul><ul><li>Corporate venture capital, investing mainly in early stage. </li></ul></ul><ul><ul><ul><li>NewCos to be developed: ~12- 15 </li></ul></ul></ul><ul><ul><li>Expert support </li></ul></ul><ul><ul><ul><li>Strategic Advisory activities for NewCo formation and development </li></ul></ul></ul><ul><ul><ul><li>Strategic partnering for NewCo development </li></ul></ul></ul><ul><ul><ul><li>Leverage from pharma company expertise in different areas </li></ul></ul></ul><ul><li>Location : Bresso (Milan, Italy) </li></ul>
  • 19. THE POTENTIAL OF YOUR RESEARCH, CUBED…..
  • 20. Z-Cube srl: An Entreprenurial Corporate Incubator <ul><ul><li>Subsidiary of the Zambon Group focused on identifying and supporting pharma projects with potential to become a NewCo </li></ul></ul><ul><ul><li>Z-Cube provides skilled project coordinators, capital and an extensive network of experts and relationships to prepare a a validated and marketable business plan with maximum financing potential </li></ul></ul><ul><ul><li>Z-Cube adds value via the type and quality of R & D and business support provided </li></ul></ul>
  • 21. Z-CUBE MANAGEMENT TEAM Z-Cube integrates competencies for NewCo success <ul><li>Zambon Group SpA </li></ul><ul><li>Competitive Intelligence </li></ul><ul><li>Corporate Marketing </li></ul><ul><li>Intellectual Property </li></ul><ul><li>Finance </li></ul><ul><li>Advisor </li></ul><ul><li>Business advisor (US) </li></ul>Inpharzam Medicinal Chemistry and Biology also devoted to service activities for Drug Optimization <ul><li>Scientific Advisory Board </li></ul><ul><li>D. Bellet </li></ul><ul><li>E. De Clercq </li></ul><ul><li>A. Lanzavecchia </li></ul><ul><li>C. Page </li></ul><ul><li>Z. Wiesenfeld-Halllin </li></ul>
  • 22. Z-Cube: from Application to NewCo yes yes Business Plan Project Coordinator Z-Cube and Zambon Group team 0 1 3 12 Screening Max Time to NewCo (months) Seed investment THREE TWO ONE Application CDA Pre- screening Z-Cube Advisory Board NewCo Investment partners: - Z-Cube - Financial investors Z-CUBE INCUBATION-DILIGENCE ROAD MAP
  • 23. Realizing a Project’s Potential CAPITAL TO GET UNDERWAY EXPERT SUPPORT GROWTH CAPITAL AND RELATIONSHIP NETWORK
  • 24. The Z-Cube Process for Start-up Companies <ul><li>Z-CUBE will fund selected projects with a preliminary investment to develop the Business Plan </li></ul>CAPITAL TO GET UNDERWAY EXPERT SUPPORT <ul><li>Each project will be assigned a project coordinator and professional team from Z-Cube/Zambon . This will ensure the development of a validate and marketable business plan with maximum financing potential </li></ul>GROWTH CAPITAL AND RELATIONSHIP NETWORK <ul><li>Z-Cube designed to invest in and syndicate the early financing rounds for the NewCos </li></ul><ul><li>Z-Cube will support the NewCo with growth capital and its relationship network going forward. </li></ul>
  • 25. Target for incubation start The proponent: <ul><li>Dynamic researchers/team of scientists with a track record of publications in peer reviewed journals </li></ul><ul><li>Strong enterpreneurial attitude and willingness to support a NewCo creation </li></ul><ul><li>OR </li></ul><ul><li>Company recently formed </li></ul>The project: <ul><li>Innovative projects with potential to become a new therapeutic for unmet medical needs with significant commercial potential </li></ul><ul><li>Active molecules identified (lead series) and supported by at least: </li></ul><ul><ul><li>IP filed </li></ul></ul><ul><ul><li>In vitro/in vivo data in relevant models </li></ul></ul>
  • 26. <ul><ul><li>Company created/consolidated </li></ul></ul><ul><ul><li>Minimal staff on board or committed (at least CEO) </li></ul></ul><ul><ul><li>Business plan finalized and approved </li></ul></ul><ul><ul><li>IP secured </li></ul></ul><ul><ul><li>Lead project no more than 12-18 months from IND </li></ul></ul><ul><ul><li>Pipeline: more than a single product/project </li></ul></ul><ul><li>Z-Cube designed to invest in and syndicate the early financing rounds for the NewCos with other VCs </li></ul><ul><li>The following characteristics are required: </li></ul>Target for NewCo launch at the end of incubation
  • 27. <ul><li>Executive Summary </li></ul><ul><li>About 1000 projects screened </li></ul><ul><li>8 projects selected for sponsorship (5 in Europe, 3 in U.S.) </li></ul><ul><li>3 companies launched and financed </li></ul><ul><ul><li>Elagen Inc. (Boston, USA): HPV replication inhibitors </li></ul></ul><ul><ul><li>SuppreMol Gmbh (Munich, Germany): soluble Fc receptors </li></ul></ul><ul><ul><li>PharmEste Srl (Ferrara, Italy): TRPV1 antagonists </li></ul></ul><ul><li>and others coming soon… </li></ul>Track record
  • 28. Z-Cube: Adding value to create business opportunities <ul><li>Experienced industrial team with on average 20 years expertise in all major therapeutic areas </li></ul><ul><li>First class competences in R&D, clinical developement, project management, strategic support for regulatory strategy and market positioning, business development </li></ul><ul><li>Leverage from Zambon Pharma key competences in intellectual property, legal, finance, strategic marketing </li></ul><ul><li>Leverage from DOIT research centre for technical assessments, drug optimization and library testing </li></ul><ul><li>Delivering of a marketable VC-grade Business Plan </li></ul><ul><li>Granting interim management and leading company staffing and financing </li></ul><ul><li>As lead investor, syndicating capitals from third party investors </li></ul>
  • 29. A unique approach and an efficacious response to the challenging scenario in life science investing Filling the gap… * University Challenge Seed Funds Mainstream VC Z-Cube Regional VC Angels UCSF * Grants and Matched Equity 0 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 Funding range £ x 000 Start-up and seed Development capital Growth capital Source: Modified from European Biopharmaceutical Review, Spring 2006 Preclinical/clinical development Tech. Platform Hits Leads/Drug candidate

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