1. Arlen D Meyers, MD, MBA University of Colorado School of Medicine CEO, Society of Physician Entrepreneurs

2. What we will discuss Logistics of the course Biobusiness concepts and definitions The Life Science Innovation Roadmap

3. Course logistics and overview View each lecture online and read assignments Participate in weekly online discussions Organize yourselves into project teams Begin to work on identifying and validating a biomedical or health innovation opportunity Deliver a 20 minute presentation the final day of class and submit a 10 page paper summarizing your findings and recommendations (format to TBD later)

4. What is an entrepreneurial mindset? Entrepreneurial mindset refers to a specific state of mind which orientates human conduct towards entrepreneurial activities and outcomes. Individuals with entrepreneurial mindsets are often drawn to opportunities, innovation and new value creation. Characteristics include the ability to take calculated risks and accept the realities of change and uncertainty

5. What is the definition of entrepreneurship? The pursuit of opportunity Using scarce, uncontrolled resources With the goal of creating user/customer/paient defined value By deploying biomedical or health innovation

6. Q:What is the definition of value? Intangible and tangible costs-intangible and tangible benefits of a product (good or service) offering IN THE MIND OF THE CUSTOMER/USER/PATIENT/PAYER What you think has value is not relevant

7. Q: What is innovation? How is it different from and idea, an invention, or an improvement?

8. old new No new value10 x value Waste of time A solution looking for a problem Disruptive innovation Incremental innovation improvement tinkering

10. Biomedical and Health Innovation Health Digital Health Care delivery platforms Business process innovation Biomedical Drugs Devices Diagnostics Vaccines Combined products

11. Why is bioscience different? IP issues Regulatory hurdles High risk Long time to market Clinical trial issues Reimbursement issues Changing business models Third party payer issues: Who is the customer?

12. Trends Commoditization driven by value Internationalization Enhanced competition differentiated by innovation Changing business models driven by digital health Physician-employer integration driven by non fee for service care Fewer private practices New payer and financing models Shift from quality to patient service and experience

13. The 10 Rules of Othercare 1. practice state of the art medicine 2. consolidate to garner market power 3. use innovative care delivery models incorporating validated digital health technolgies 4. Improve patient communication portals 5. Dominate on service and experience, not quality

14. 10 Rules of Othercare 6. Measure everything 7. Adopt an entrepreneurial mindset 8. Maximize practice management efficiencies and efficacies 9. Lead 10. Fail early, cheaply and often with new product line offerings

15. Life Science Innovation Roadmap

16. The Lean Startup Process Create a minimally viable product based on the founders vision and feedback from early customers (customer discovery) Create a business model and validate assumptions (customer validation) Create customers using the scalable business model Grow the company Exit

17. 3 Phases: SOPE Phase 1: Scoping the opportunity (SO) Macromarkets Micromarkets Macroindustry Microindustry Leadership Team Phase 2: Planning, vetting, feasibility, validating (P) Rapid Prototyping and experimentation Phase 3: Executing (E)

18. The Four legged stool Intellectual property protection Regulatory/Quality Assurance approval Reimbursement plan Business plan execution and continual modification

19. The Capital “Stack” CapitalValue Advisors, LLC is a registered broker/dealer and member of the Financial Industry Regulatory Authority (FINRA)19 Type of CapitalPros/Cons Senior Debt - SecuredNon-dilutive, least expensive, but ties up assets – limited amount available Junior or Mezzanine Debt May be non-dilutive, more expensive, may not tie up assets Trade Credit/Credit Cards More easily available, highest interest rates, non-dilutive Preferred EquityAllows more debt, more aligned with owners, but dilutive Common EquityCompletely aligned with owners, but most dilutive, possible control issues drmimi94954@gmail.com

20. Capital Sources CapitalValue Advisors, LLC is a registered broker/dealer and member of the Financial Industry Regulatory Authority (FINRA)20 AmountGrowthBuyout <$1M Friends/Family SBA High Net Worth Small Local Funds High Net Worth Small Local Funds SBA $1-3M Small PE Firms VC Firms Banks/Mezzanine Small PE Firms $3-5M PE Firms VC Firms Strategic Investors Banks/Mezzanine PE Firms Strategic Investors >$5M PE Firms VC Firms Strategic Investors Banks/Mezzanine PE Firms Strategic Investors

21. Financial Value Organization al Value Customer Value Employee Value Strategic Value Value Drivers DrivingValue ReducingRisk CapitalValue Advisors, LLC is a registered broker/dealer and member of the Financial Industry Regulatory Authority (FINRA)21

22. Financing Biomedical ventures Research Mostly government basic science grants Development Family, friends, fools SBIR/STTR Angels and angel networks Proof of concept awards State development awards Business plan competitions Collaborative research and development grants (CRADA) Crowdfunding sites like http://medstartr.comhttp://medstartr.com Accelerators like http://www.blueprinthealth.comhttp://www.blueprinthealth.com

23. Financing Biomedical Ventures Commercialization IPO’s Strategic partnerships Corporate Venture Funds VC’s Reverse mergers/PIPE’s

24. Questions? Are the ethics of business compatible with the ethics of medicine? Why do innovation initiatives fail in most hospitals?