“IP Universities” Istanbul, May 23 to 25, 2013 Albert Long Hall, BOGAZICI UNIVERSITY “‘DUE DILIGENCE & TECHNOLOGY TRANSFER” Shirley Gee, Chair, Keiretsu Life Science Committee* Angel Plus, LLC, Managing Partner* Stanford University/SLAC National Accelerator Laboratory, Retiree* *for identification purposes only

“Merhaba” “Hello!”

MANAGING INTELLECTUAL PROPERTY AT UNIVERSITIES FROM MACRO TO MICRO FROM POLICY LEVEL THROUGH STAGES OF INNOVATION TO SELECTING LICENSEE VIA DUE DILIGENCE

POLICY LEVEL

UNIVERSITY TECHNOLOGY & LICENSING 1 Stanford University, Dr. Arthur Bienenstock, Dean 1 of Research,

1. Reserve right to practice licensed inventions 2. Structure exclusive licenses to encourage technology development and use 3. Minimize licensing of “future improvements” 4. Manage technology transfer-related conflicts of interest 5. Ensure broad access to research tools Stanford University, Dr. Arthur Bienenstock, Dean of Research, 2006

6. Exercise prudent in enforcement action 7. Consider export regulations 8. Be careful with patent aggregators 9. Consider giving priority to those who address unmet needs or whose efforts have broad public impact. Stanford University, Dr. Arthur Bienenstock, Dean of Research, 2006

STAGES OF INNOVATION

I. Research II. Invention Disclosure III. Assessment IV. Intellectual property V. Marketing to find a Licensee VI. Selecting a Licensee VII. Licensing VIII. Commercialization IX. Royalties

LICENSEE SELECTION VIA DUE DILIGENCE

Public Interest Quotient Social Implications Management Team Financial Underpinings Product Review Market Review Regulatory Path Risk Mitigation Anciliary Patent Potentials Milestones & Timetable Quality Assurance Exit Strategy

PUBLIC INTEREST QUOTIENT Unmet Need Neglected Communities Broadly impactful

SOCIAL IMPLICATIONS Solves a long-standing problem (e.g., cancer) Addresses a basic need (e.g., agricultural solution to solve a hunger issue) Long term social good e.g., (conserve resources)

MANAGEMENT TEAM Who Are Principals? Who are their Advisors? What are their talents/weaknesses What is their history? (e.g., for running a company; execution style; creating value; exiting) As a team, can they execute, execute, execute Is management team in full alignment

FINANCIAL UNDERPINNINGS Three years financials (past) Financial Projections (future earnings) Liens? Lawsuits over money? Tax returns reconcile with financials? Capitalization of Business Debt, cash flow, burn rate, income, balance sheet Margin, gross, operating expenses, net Demonstration of financial restraint

PRODUCT REVIEW Unique. Delights. Functionality. Utility. Necessity. Ease of Use. Placement (Domestic/International). Pricing Model Potential for “broad” Market Acceptance (e.g., beyond early adopters) “Secret Sauce” (Differentiation) Competing products (late entry?) Efficacy – Solve a Problem or Meets an Ongoing Need? (novelty item vs. repeat purchase item)

MARKET REVIEW Addressable Market Sales Projections (2-3 years) Early Adoption…how? Who are opinion leaders? Competitors (Crowded space?) Marketing strategy? Distribution channels? Roll out plan? Cost to roll out? Timetable for Sales and Marketing

REGULATORY REQUIREMENTS Federal Agency (e.g., FDA) Sequence and Timetable of approval Classification of product (i.e., Class I vs. Class III) Cost associated with approval process Stages of product development (e.g., Clinical Trials 1 and 2; more R&D needed; modifications needed)

RISK MITIGATION Identify Challenges and Risk Ahead How is Company Mitigating Risk Strategic Planning for Solutions

ANCILLIARY PATENT POTENTIAL Opportunity for “spin off” patents Developing a Platform Product or Solo Product

MILESTONES AND TIMETABLE Strong business plan in place Measurable milestones and timetable Sufficient financial runway to match Short or long range proposition

QUALITY ASSURANCE Standard Operating Procedures Human Capital Management Procedures Vendor Selection Criteria Operation Excellence

EXIT STRATEGY Probability for a Liquidation Event Potential Acquirers Identify Challenges to an Exit and How Company Mitigates

“Teşekkür ederim” “Thank You”