Executive Summary
We are planning to develop a patentable, new type of Process Analytical Technologies (PAT) system for biotech and pharmaceutical companies who would like to improve their ineffective and expensive manufacturing processes and thus improve the quality of their products. To help implement our PAT software, we are also wishing to establish a support laboratory besides the software development.
Competitors currently on the market provide too universal PAT software which can be used in different industries (i.e. the same PAT software is used both in the car and the pharma industry) for analyzing and controlling manufacturing processes, so their software cannot be exploited by the average customer. Contrarily, the key advantages (Unique Selling Proposition) of our software are:
1. It is totally customizable to meet the requirements and demands of the partners.
2. It offers a complete service in regard to biotechnological applications. It is a key point as there aren’t any types of PAT software developed for the biotech industry currently (i.e. the same PAT software is used both in the car and the pharma industry), and competitors’ software in the present are too universal and not appropriate for the sensitive pharmaceutical analytical measuring equipment.
3. The classical, rigid systems become flexible because our system adapts to given technology.
Model-integrated solution:
While the competitors’ PAT system is only able to interpret, interconnect and store the results and data of the measurements of the manufacturing process, our system – due to the built-in genetic-generic algorithms and models – is able to compare the results and learn from them by itself (self-learning system), furthermore it can be used for prognoses and modeling the results of future experiments, as well. It is an utterly unique feature of our software.
Market opportunity:
PAT is already recommended by the FDA, but later it can be presumably obligated for companies.
Currently 74% of pharmaceutical manufacturers say they either already have or will have in the next 30 months a PAT initiative (Source: 2010 AMR) so immense prospects reside in the quick action. Considering USA and Europe, more than 1100 pharma companies would like to implement a PAT system into their processes. In 2008, 1000 new licenses and in 2009, about 3500 licenses were sold by the potential competitors (ABB, Siemens, Symbion) for an average of $130,000/license. The total pharma market is more than $450 million and this is expected to increase by 7.4% annually until 2015. (Source: BCC Research) Our target is to reach 5-10% of the biopharma market in the next 5 years.
Sales and marketing strategy:
We are planning to apply B2B and B2C strategies simultaneously. Our products are:
- a continuously improved PAT software - approved by FDA - with an IT tool (will be patented)
- a service (continuous support for the clients)
- organization of workshops, PAT training and conferences about the implementation of PAT
- constructing project-specific PAT (PAT software development taken on lease)
- performing fermentation experiments, analytical measurements and modeling projects
We already started negotiations with Mylan Inc. (Komárom, HU), Gedeon Richter Ltd. (Budapest, HU), TEVA Pharmaceutical Industries Ltd. (Debrecen, HU) and Novartis International AG (Basel, CH). Although no contracts have been signed yet, we had verbal agreement with the contact persons that they all want to participate in the testing of the prototype, and are interested in the purchase, too.
Our system also costs $130.000, and long-term revenue can be achieved from license fees taken annually, in addition to the fees coming from the system implementation and other additional services.
Team:
The core team is already formed. The project owner is a bioengineer who has significant experiences on the field of business and PAT systems as well. The C.E.O. & senior project leader has been a project manager for 2 decades. Mathematical background for software development is provided by one of the best computer modelers in Europe, and lab support and fermentation experiments for software improvement are led by the leader of the Biotechnological Research Center of Debrecen University. In addition, maintaining contacts with key partners are done by a B.Sc. student of bioengineering sciences as a junior project assistant and technology coordinator.
As for the future, we are also planning to involve software engineers to speed up the development.
Business model and funding:
The complete development takes 16 months and $865,000 is required ($695,000 for the software development and to maintain the team, $170,000 for fermentation experiments). The minor part of this is ensured from own funds (Founders&Family&Friends) and orders, while the greater part would come from investors (venture capital). The estimated time of ROI (Return on Investment) is about 3.5 years.
The first marketable version of the software is ready within 7 months after the start of development.
We need a capital injection of $340.000 from the total $865.000 for this period.
