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A Case study of Biotechnology: - How to use Biotechnology for
Economic Development Theme 3: IP Financing in the Field of
Patents
By Iain C Shirlaw
Information Meeting on Intellectual Property FinancingOrganised by the World Intellectual Property Organisation (WIPO)
Geneva, Switzerland, March 10, 2009
Introduction to Scotland
– Population 5.1m– North West edge of Europe– Respect for Education– 14 Universities– Produces 1% of world’s
published research– Graduation rate of 39.2%, from
first degrees * (#1 in OECD)– 620 Life Science companies– 31,000 Life Science jobs– In 2007, 20 new Life Science
companies formed– £3 billion contribution to the
economy
Time line
• 1413 St. Andrew’s University• 1495 Aberdeen Medical school• 1776 Adam Smith, “Wealth of Nations”• 1975 Scottish Development Agency• 1979 Venture Capital - Biogen• 1981 Spin outs Monotech and Bioscot• 1998 Pharmaceutical Proteins IPO• 2004 Cyclacel first European Biotech
$100m funding• 2007 Haptogen acquired by Wyeth
Fashions in IP development
• Universities as source of learning and publishing.
– 1980 MRI scanner first demonstrated Aberdeen, but GE / Fonar fought patent for use of MRI in cancer detection
• Tech transfer and academic consultancies– Prof Stenlake’s Atracurium, £29m
• Science Parks– 1971 Heriot Watt Research Park – first science park in
Europe
• Spin outs– Aurora– Drug Development Scotland– Cyclacel
• Specialist IP asset developers and funders assets
– British Technology Group– IP 2 IP– Braveheart– Exomedica
1980’s Life Science investing
Corporate Legacy: Glaxo, Roche,
Organon– Coats Paton, Monotech
• Public Sector– Scottish Development
Agency: • Inveresk, Cruachem,
Bioscot
• Venture Capital: – 3is, Apax, Transatlantic
• Angel investors: – Biocure, Bill Bruce
Financing Sources
• Scottish Enterprise – LSBAS, Spin outs
• IPOs– PPL, Scotia, Scotgen, Biocure,
Shield
• VC Funds– Scottish Equity Partners– Albany Ventures
• Angel Syndicates– Archangel– Braveheart
Government Investment Strategies
Scheme Bridging
Research
SMART
Development
Enterprise fellowships
Entrepreneurship
Proof of Concept
New company
Seed Fund
Spin out
Co-investment
Angel investors
Venture Fund
Scottish Government support
Fund Size Investment Range % Life Sciences
SMART for SMEs £7m p.a. (£32m over 5 years)
Up to £600k (35% of total
64%
SE Investing Scottish Seed Fund £2m ~ £100k Scottish Co-investment Fund – April 2003
£11m £100k - £1m 32% (£13m)
Scottish Venture Fund – Jan 2007
£10m £500k - £2m 28% (£5m)
Scottish Enterprise invests approximately £25m p.a. - around 30% of that is in Life Sciences.
All funds invested are matched by private sector funding on at least 1:1
21st Century Development Frameworks• Public Sector Initiatives
– SMART– Enterprise fellowship– Proof of Concept– Start-up– Co-Investment Fund– Venture fund– Gateway Advisory Services– Life Science Business Advisory group– Life Science Alliance– Bio Industry Association Scotland– Nexxus Bioscience Network
• Angel Syndicates - Over 30– Archangel– Braveheart– Highland– Tricap– Alybyn– Discovery
• Clusters– Edinburgh Science Triangle– Pentlands Science Park– Edinburgh Technopole– Roslin Bio Centre– Bio Campus– Heriot Watt Research Park– West of Scotland Science Park– Nova Technology Park– City Science Glasgow– Lanarkshire Medi-park, Strathclyde Business Park– Scottish Enterprise Technology Park, East Kilbride– Dundee MediPark– Dundee Technology Park– Scottish Crop Research Science Park– Dundee Technopole– Aberdeen Science & Technology Park– Foresterhill– Edinburgh Bio Quarter - $1 billion to create one of world’s
finest Biomedical centres
The Next Issue - The funding gapInternational Commercial Skills
40
Business Building
Skills
Scientific and Technical Skills
5
Proofs:Technical Concept
Product Definition
Market Acceptability
Client Orders
Business Capability
Company Growth
Corporate Expansion
1 2 3 4 5 6 7
SMARTEnterprise fellowship
Proof of Concept
Seed Fund
Technology Investors
Angel Co-investment Fund
SE Venture Fund
Active Investment
Private Equity
Corporate
University Spin out Start-up Establishment Growth National International
VA
LUE
BE
NC
HM
AR
K
Conclusion
Scientific IPInvention
DevelopmentMarket
ProduceCreate Business
Attract InvestmentGrow Business
InternationaliseCorporatise
Progress IP from Upstream to Downstream to capture most economic value
Biotechnology can be a very significant contributor to both local economic well being, and worldwide health improvements.
One of a nation’s key assets is the ability of its people to invent, develop and commercialise. Scientists who are awarded government grants also
have a responsibility to recognise the Value of IP to the economy and health and welfare of its people
Iain Shirlaw• Contact details:
Active Investment PartnersManagement Services
ConsultingInvestment
With Special Thanks and Acknowledgement in the preparation of this presentation to Alan Muir, Bill Harris, Pat Mc Hugh and Michael Cannon