1. Leveraging Biotech Ecosystems to Build Biomedical Startups
Kelvin S. L. Chan, PhD
7 Oct 2016
HATCH!

2. Overview Overview of biotech ecosystems of San Diego and Singapore
Three challenges San Diego and Singapore ecosystems faced
Startup Pentagon: Five essential elements of a biomedical startup

3. Background
2006 BA (Hons) Natural Sciences University of Cambridge, UK 2009 Researcher – drug discovery A*STAR Institute of Chemical and Engineering Sciences, Singapore 2010 PhD (Organic Chemistry) The Scripps Research Institute, California 2014 Springboard Fellow CONNECT San Diego (business accelerator) Advisor PureWick (medical device startup) 2015 Managing Director Celsius Global Research Fellow – radiopharmaceuticals A*STAR Singapore Bioimaging Consortium, Singapore 2016 Mentor GBR GapSummit and SLoT forum

4. The biotech ecosystems of San Diego and Singapore
San Diego’s biotech beginnings
Early successes in R&D  knowledge capital
1978 Ivor Royston founded Hybritech to use monoclonal antibodies to diagnose and treat disease
No venture capitalists in SD at that time: supported by KPCB (San Francisco)
Hybritech bought out by Lilly and fueled entrepreneurial growth

5. The biotech ecosystems of San Diego and Singapore
San Diego now*
3rd largest biotech hub in the world
R&D provided US$14b in annual economic impact
34,000 employees, 1100 companies (82 new in 2015)
> 80 research institutions producing > 7000 STEM graduates annually
Venture capital investment totaled US$620m for 45 deals
Angel financing totaled US$28m in 53 companies
*2015 data

6. The biotech ecosystems of San Diego and Singapore
Singapore’s growth as a regional hub
2000 Biomedical Sciences Initiative – EDB, EDBI, A*STAR
Phase 1 ( ): Building a Strong Foundation
Physical infrastructure for basic science capabilities
Establish critical mass of research talent – renowned scientists, and local talent
Phase 2 ( ): Building up Singapore’s Translational & Clinical Research
Research areas were chosen by relevance to Singapore’s healthcare challenges
Developing MedTech industry in Singapore
Phase 3 ( ): Integrating for Greater Economic and Health Impact
Industry engagements focusing on economic outcomes
Sector focus – Pharmabio, MedTech, personal care, nutrition

7. The biotech ecosystems of San Diego and Singapore
Regional R&D and manufacturing hub
5% of national GDP
RIE2020 (Phase 4 of BMS Initiative) commits US$14b to R&D, 20% spent on HBMS
Chosen 5 therapeutic areas; diversification beyond MedTech, focus on health services research
> 50 companies, 30 research institutes.
Employs 5000 in R&D and 14,000 in manufacturing*
Venture funding
Early Stage Venture Fund (ESVF) totaled US$110m in last 8 years (not all for biotech)
*2010 data

8. Three challenges SD and SG ecosystems faced
1. Remoteness
San Diego was geographically distant
Surrounded by deserts, ocean, and neighboring country
Remote from center of federal and state government
Blank slate meant that there was freedom to operate
Singapore was similarly remote pre-2000
Few biomedical partners locally and regionally then
Globalization and vast improvements in telecommunications now allow and even enhance borderless partnerships

9. Three challenges SD and SG ecosystems faced
2. Government support
San Diego had no masterplan on how to develop the city’s economy
Technological advances for the military spunout unicorns such as Qualcomm
Today 24% of the county is still employed by defense spending
Government later increased spending on fundamental biomedical research, and on infrastructure – which later led to formation of Hybritech
San Diego still needs to lobby for support – organizations like Biocom continue to play a role in Washington D.C.
Singapore’s biomedical hub was meticulously planned

10. Three challenges SD and SG ecosystems faced
3. Private funding
San Diego has substantial VC funding – US$620m in 2015
However, most funds come from outside San Diego (e.g., San Francisco Bay, Boston), especially after 2008
Number of local VCs is not always indicative of ability to start a biomedical startup
Singapore’s funding is largely from government support and grants
Lightstone Ventures has set up a US$50m fund for Singapore biomedical startups

11. Five essential elements of a biomedical startup
Startup Pentagon
Huge
unmet need
Innovative Business Model
Disruptive
technology
Appropriate Funding
Right
People

12. Five essential elements of a biomedical startup
1) Huge unmet need
Innovative Business Model
Disruptive
technology
Appropriate Funding
Right
People
Find the NEED
Can be in any aspect of the pipeline
Must be a NEED vs a WANT
Who are the people who will benefit from this problem being solved?
e.g., in Singapore – ageing, robotics

13. Five essential elements of a biomedical startup
Huge
unmet need
Innovative Business Model
2) Disruptive
technology
Appropriate Funding
Right
People
R&D to build the product that will SOLVE the need
What latent technology can you repurpose?
Diversity of economy = convergence of sectors
e.g., San Diego’s healthcare + IT = wireless health

14. Five essential elements of a biomedical startup
Huge
unmet need
Innovative Business Model
Disruptive
technology
Appropriate Funding
3) Right People
Form a ‘A’ team with international gravitas
Both as co-founders, and advisors
Networking nodes are borderless
Intermediaries
Accelerators (CONNECT San Diego), incubators (Y Combinator, HATCH!); or
Highly networked individuals

15. Five essential elements of a biomedical startup
Huge
unmet need
Innovative Business Model
Disruptive
technology
4) Appropriate Funding
Right
People
Early seed: grants, or competitions – e.g., OneStart
Biomedical seed ~ US$1m vs other startup seed ~$100k (10x difference)
Smart $: sophisticated VCs preferred
this is important in biomedical sciences because timeline is longer
Use mentors and advisors (“3. Right People”), and intermediaries to search globally
Private VCs may be geography-agnostic

16. Five essential elements of a biomedical startup
Huge
unmet need
5) Innovative Business Model
Disruptive
technology
Appropriate Funding
Right
People
e.g., virtual drug discovery company
Use distributed partnerships vs vertically integrated business model
Do not need full function and service to get to a commercializable stage
Use Contract organizations
Use Partnerships

17. Innovative Business Model
Conclusion
Globalization = Network, leverage people beyond your shores
Startup Pentagon
Huge
unmet need
Innovative Business Model
Disruptive
technology
Appropriate Funding
Right
People

18. Kelvin S. L. Chan, Ph.D. kelvinchan@celsiusglobal.com @CelsiusChan