Transcript PharmOut

Introduction
Opportunity
 Market
potential of recombinant drugs
Problem
 Lack
of manufacturing capacity
Solution
 PharmOut:
Contract BioManufacturing
Industry
$48.5 Billion
Projected Biotech
Industry Growth
$28.3 Billion
$16.1 Billion
2001
2005
Year
2010
Expanding Pipeline
Pre-Mapping of
Human Genome
Post-Mapping of
Human Genome

500 targets

10,000 targets

175 biotech drugs

3,500 > potential
biotech drugs
Industry
Capacity in Liters
(Thousands)
Capacity Shortage
1,500
1,000
800,000
L VOID
Capacity
Demand
500
0
2001
2005
Year
Industry
Drug Development Timeline
16 YEARS
Research and Development
Pre-Clinical Testing
$500 Million
Phase I
Phase II
Phase III
FDA Review & Approval
Commercialization
0
4
6
8
10
Year
12
14
16
Marketplace
Industry Manufacturing Options
 Build
own plant
 License
technology
 Outsource
production
Marketplace
Market Conditions

Expanding Pipeline

Capacity Shortage
Solution: Outsourcing
 Lowers
Costs
 Speeds
Time to Market
 Decreases
Risk
Services
The PharmOut Service Platform
 BioManufacturing
 Process
Development
 Support
Services
Competition
Flexibility (High)
Future
PharmOut
Expansion
Capacity (Small)
Capacity (Large)
Other CMO’s
Large Pharma
In-House
Flexibility (Low)
Target Customer
Small Biotechnology Companies
 Recently
Funded
1,040 Private Biotech Companies Now
140 Target Companies
 Recombinant
Protein Drugs in
Development
 Limited
House
Resources to Manufacture In-
Why PharmOut?
Biotech Wants:
PharmOut Provides:

Minimize Capital
Risk

Scalable Facilities &
Support Services

Gain Capacity &
Expertise

Improved Scheduling &
Capacity Utilization

Maximize Internal
Resources; Saves in
CapEx & Bad Batches

Improved Manufacturing
Process

Reduce Time to
Market by 12 to 24
months

Process & Manufacturing
Expertise
Service Strategy
Outsourced BioManufacturing

BioManufacturing Facilities

Process Development

Support Services

Brokerage Services

Client/Customer Relationships in Place

Improved Manufacturing Processes Leads
to Improved Efficiency
Value Proposition
“Our competency in manufacturing allows
clients to focus on their competency,
research and development.”

Excellence in Process Development and
BioManufacturing

Regulatory Compliance

Expert Staff

Strong Relationship Management

BioManufacturing Innovation
Revenue Model
Process Development
 $300,000
per development
 PharmOut
shares process
development rights
BioManufacturing
 $100,000
average per production run
Market Possibility
Market Potential
 140
1
Target Biotech Companies
Drug per Company
 Revenue
Generated for Full Services
= $1.3 Million
 Total
Market Potential = $182 Million
Marketing Strategy
Relationship Marketing
 In-House,
 Team
Expert Sales Force
Based Project Management
 Comprehensive
 Significant
Website
Industry Presence
Operations
Manufacturing Process
1.
2.
3.
Fermentation
= Recombinant Protein
= Bacterial Protein
Recovery
4 Main Steps …
Purification
Packaging
Cell Solution Provided
4.
Fermentation
Recovery
Purification
Fill
Operations
Facility Snapshot
 20,000
SF Leased Facility
 ISO9001
and cGMP Validation
 Equipment
10,000 SF Clean Room
Fermenters, centrifuges, homogenizers,
protein purification suites and cold
rooms
Competitive Advantage:
Operational Excellence
Mnfg.
Expertise
Flexible
Asset
Facility
Utilization
Optimized
Process
Customized
Solutions
Maintain Core
Comptency
Operations
Capital Needed
$7.8 Million
$3.4 Million
$2.5 Million
1&2
3
Year
4
Revenue
$59.5 Million
Pricing
Asset
Model
Utilization
$35.5 Million
Lease
versus Build
43%
$16.6 Million
1
2
3
Year
4
5
= Gross Margin
Net Earnings
$8.5 Million
$5.4 Million
$8.5 Million in Year 5
14%
$1.8 Million
1
2
3
Year
4
5
= Profit Margin
Cash Flow
$ Millions
PP&E
Operating CashFlow
10
8
6
4
2
0
-2
-4
-6
Year 1
Year 2
Year 3
Year 4
Year 5
Risks/Financial Plan
Risks
Biotechs
Remedy
Produce
In-House
Government
Relationship
Marketing
Regulation
Friendly
FDA Attitude
Offering
Three Rounds of
Financing………….
Offering
Time
Period Round Amount Benchmark Equity IRR
Year 1
A
$8 M
Mnfg. Lease
51%
85%
Year 1.5
B
$4 M
FDA Approval
6%
60%
Year 3
C
$5 M
$16 M in Rev.
5%
50%
Management
CEO
Jennifer Eby
COO
Douglas Gier
VP, Marketing
Cecily Ford
Maguire
CFO
Jay Behringer
Advisory Board
Matt Lombardi, Sr. Project Manager
Vicki Jenings, Director of Operations
Dr. Steve Orndorff, President
Dr. David Drubin, Professor of Genetics
Dr. James Powell, Assoc. Director, Mnfg
Mike Green, Director, Mnfg
 HighTech Business Decisions
Sandra Fox, President
Conclusion
Opportunity
 Market
potential of recombinant drugs
Problem
 Lack
of manufacturing capacity
Solution
 PharmOut:
Contract BioManufacturing
Questions?