Boston University recently held its $50K Business Plan Competition and, while there were no medical device companies in the running, I thought it would be interesting to hear from the top two teams. For those of us preparing our own business plans, listening to what they did right and wrong can be really valuable.
David Spenciner: Mike, congratulations on coming in first place. Can you give me an abbreviated elevator pitch?
Mike Koeris: Thanks Dave. Novo-Phage is developing a technology which utilizes engineered bacteriophages — viruses that selectively infect bacteria — to enhance current clinical standard-of-care antibiotic treatment. We are tackling the growing problem of drug-resistant and multi-drug-resistant strains of bacteria that are becoming more common in hospitals and in the community at large.
DS: Lauren, nice job coming in second place. What is your pitch?
Lauren Celano: Well, Dave, there is a need in the market for a more efficacious asthma treatment. Air-Go is developing the next generation of asthma treatments based on a novel mechanism of action. Rather than being a “me-too” bronchodilator or anti-inflammatory, Air-Go’s lead molecule approaches asthma treatment from a totally new direction. We’re very early stage, of course, and recognize that the regulatory process is a long one, but we’re excited about the technology and have begun getting positive feedback from leading companies in the asthma space. And yes, we’re looking for some seed funding at this point.
DS: Lauren, what were some of the more memorable questions that the judges asked you during the competition?
lc: Nessan Bermingham of Bio Equity Risk Management asked me a really interesting question about our patents. We were all set to answer questions about Air-Go’s IP status and strategy in terms of freedom to operate and protection in this space, but he wondered if there was patenting activity near to our patent from other companies. I had not anticipated this so my answer probably could have been stronger. There has been a lot of patent activity and research in the regulation of [gamma-glutamyl transferase] activity for non-lung-related organ systems, but to date, many companies have not specifically patented work in this direct space. We have seen an increase in publications and patents from universities looking at GGT regulation in the lung as a way to provide anti-oxidant defense, which is the mechanism which we’re focusing on. By asking this question, Nessan was making the point that if you really have such a good idea, then often times others will be patenting technology similar to yours. This can be form of validation for your “novel” idea.
I had two questions about my management team. We should have been more explicit about the background of each member of our team and all of our qualifications. Beyond this, I think that the judges were assessing how open we were to stepping into different roles at Air-Go if more experienced people could be brought in. Since our mission is to develop drugs for the treatment of asthma, all of us are open to bringing in experts when they are needed in order to provide a better chance of success for the company. This (hopefully) will be the first of many companies I start, therefore I would welcome the opportunity to learn from leaders in the field so that I can grow my skill base to make me even stronger for future endeavors. I feel that it is important to be self-aware and acknowledge that you might not have all of the skill set required to take your company to the next level. The important point here is to make sure you are working to improve the areas which need development. Being flexible and not getting caught up in having some fancy title is important. At the end of the day, we are here to find treatments for diseases and we cannot forget this.
DS: Mike, what were some of the lessons that you learned?
MK: I was happy that we were able to pretty well anticipate their questions. For example, we are in the process of demonstrating manufacturability and scale-up manufacturability. We’re lucky to be getting advice from some Boston-area professionals whom we met through our respective networks.
At the pre-contest evaluation, Nessan ripped our heads off — in a positive way — about our first indication (sepsis). We knew that having a slam dunk as a first application is vital, but sepsis just isn’t it. The science had pointed us in that direction, but Nessan had the crucial insight and industry background that the preponderance of evidence required by the [federal Food & Drug Administration] for this indication would be too much for a start-up. It’s all part of the learning curve for us.
The focus of our investor pitch has started to change as our company has gone from an idea to more of a real start-up. We’re finding that the science and market aspects are no longer sufficient and we now need to focus more on IP protection and production capability. These are not areas of expertise for our management team and so this transition has been hard on us. Taking a page from Donald Rumsfeld, we’re moving toward “know what we don’t know.”
DS: And you Lauren?
LC: Because we are proposing a new way of treating asthma, we should have included more rigorous scientific validation in the presentation. We didn’t want to overload our plan with too much science, but we needed to do a better job convincing our audience that we know a lot about our lead molecule and its mechanism of action. We are fortunate to be working in a space where the mechanism of action (GGT inhibition) is biologically well-defined. This provides us with a large competitive advantage. We also know the structure of GGT, which helps to drive medicinal chemistry efforts. We don’t have a “me-too” product, but our plan didn’t adequately show that we were different. For companies who present in the future, ensure you have adequate information about the science — including the information as backup slides would be helpful so you can reference it. It never hurts to have too many backup slides.
Also, Dave, we should have pitched our plan to more people before the competition, so that we could have been asked a larger variety of potential questions. For people considering this in the future, I recommend talking with and pitching to as many people as you can. This entire experience has provided me with fantastic insight since writing and presenting a business plan really makes you focus on what are your key aspects and core proficiencies are. I definitely feel stronger for having gone through the process.
DS: Well, thanks again Mike and Lauren. It seems to me that our readers who are thinking about competing in one of the many business plan competitions around Massachusetts would be well served by learning from your experiences. I know that I’m going to be doing a little extra preparation for the upcoming Rhode Island Business Plan Competition.