1. Government Funding Opportunities Don Van Dyke Business Development Consultant Ontario Ministry of Economic Development & Trade

2. Where is Ontario? Life Science in Ontario Medical Devices in Ontario Direct Government Funding Ontario VC Fund Tax Savings & Rebates Government Loans for Advanced Manufacturing Public Offering Funding Additional Resources AGENDA

3. Where is Ontario?

4. Exceptionally Located Ontario gives access to over 135 million consumers within 500 miles NAFTA gives Ontario based companies easy access to the US market Less than a 2-hour flight from major U.S. life science centers

5. Life Science in Ontario Biopharmaceuticals Medical Equipment Healthcare IT

6. Pharmaceuticals –16,250 employees –Includes global giants such as AstraZeneca, Bayer, Eli Lilly, GlaxoSmithKline and Pfizer –Revenues of more than $7 billion Medical devices –22,000 employees –600+ companies –Revenues of $4 billion-plus Biotech –5,200+ employees –140+ companies, more than any U.S. state except California or Massachusetts, including global giants such as Amgen, Genzyme and Sanofi Pasteur –Revenues of more than $2.7 billion Life Science in Ontario

7. Medical Devices in Ontario Employs 22,000 people Includes more than 600 Device companies >60% of Canada’s Device industry Includes GE Medical Systems, Siemens, Abbott Point of Care (iSTAT) and Johnson & Johnson Medical Products Includes Ontario-founded MDS Sciex, SciCan, CME Telemetrix & Tm Bioscience Revenues greater than $4 Billion

8. Where is Ontario? Life Science in Ontario Medical Devices in Ontario Direct Government Funding Ontario VC Fund Tax Savings & Rebates Government Loans for Advanced Manufacturing Public Offering Funding Additional Resources

9. 9 Ontario’s Next Generation of Jobs Fund NGOJF is a $1.15 billion program over five years –This compares favorably to U.S. State programs –Part of a larger “Innovation Agenda” of $3 Billion over 8 years The fund supports innovative investments in technology, research, development and commercialization across industries

10. Next Generation of Jobs Fund - 3 Programs

11. Strategic Opportunities Program The Strategic Opportunities Program (SOP) provides support for seed investments in three focus areas: –Bio-Economy / Clean Technology –Advanced Health Technologies –Creative Industries. Projects must address a clear market potential, demonstrate commercial and economic potential SOP will support industry-led not-for-profit research collaborations up to 25% Industry will contribute at least 30% Strategic Opportunities Program Strategic Opportunities Program

12. Cash Flow NGOJF Grant Project Expenditures 1. 20% Advance upon signing funding agreement  20% of Grant  Company expenditures to earn the advance $3M$0 $20M 2.Further disbursements  60% of Grant reimbursed incrementally based on 15% of project expenditures $9M$60M 3.20% Holdback released after 100% investment commitment certified  20% of Grant $3M$20M Total$15M$100M Project Investment Commitment - $100M. NGOJF Grant - $15M (15%)

13. Where is Ontario? Life Science in Ontario Medical Devices in Ontario Direct Government Funding Ontario VC Fund Tax Savings & Rebates Government Loans for Advanced Manufacturing Public Offering Funding Additional Resources

14. $205-million Ontario VC Fund Ontario’s contribution to the fund is $90 million. Between 80 per cent and 100 per cent of the capital invested in Ontario VC funds. Up to 20 per cent of the capital will be available for direct co-investments in companies. The $205 million Ontario Venture Capital Fund is the biggest fund of its kind in Canada

15. Where is Ontario? Life Science in Ontario Medical Devices in Ontario Direct Government Funding Ontario VC Fund Tax Savings & Rebates Government Loans for Advanced Manufacturing Public Offering Funding Additional Resources

16. Ontario has broad definition of R&D New product development Development of new or improved materials Manufacturing process improvement

17. Tax Savings for R&D in Ontario Ontario’s provincial tax credits, combined with Canadian federal tax credits can cut the cost of a $100 R&D expenditure to less than $44 Every dollar is deductible, not incremental Not just tax relief –Refundable cash benefit of 30 – 45% –No revenue stream required –$3 Million in R&D spending gets a check from the government of up to $1,350,000 These R&D tax credits are the most generous of any G-8 nation

18. Tax Savings for R&D in Ontario R&D Conducted @ Company R&D Conducted @ Research Institution GROSS RESEARCH EXPENDITURE$100.00 Ontario Innovation Tax Credit (OITC) – 10% (10.00) Ontario Business-Research Institute Tax Credit (OBRITC) – 20% (20.00) Federal Investment Tax Credit – 20%(18.00)(14.00) Tax Deduction ($72 * 36.12%)(26.01)(20.23) Ontario Exemption of Federal Investment Tax Credit ($18 * 14.0%) (2.52)(1.96) ACTUAL COST OF $100 R&D$43.47$33.81

19. Where is Ontario? Life Science in Ontario Medical Devices in Ontario Direct Government Funding Ontario VC Fund Tax Savings & Rebates Government Loans for Advanced Manufacturing Public Offering Funding Additional Resources

20. Advanced Manufacturing Investment Strategy - AMIS - A $500 million incentive loan program Targeted at innovative activities in advanced manufacturing: –Industrial R&D –Design, prototyping and engineering –New or advanced materials and products –Advanced manufacturing processes –Technology innovation –Robotics/software development –Waste reduction or energy conservation

21. AMIS Loans Loan of up to 30% of eligible project costs (max $10 million) Provided at Ontario’s cost of borrowing plus 1% Repayable loans are interest free for up to 5 years provided the firm meets milestones and performance targets The loan must be secured and the principal repaid, but the terms are negotiable including term length

22. Where is Ontario? Life Science in Ontario Medical Devices in Ontario Direct Government Funding Ontario VC Fund Tax Savings & Rebates Government Loans for Advanced Manufacturing Public Offering Funding Additional Resources

23. Public Offerings Toronto Stock Exchange (TSX) TSX is one of the best markets in the world for raising public equity capital –2nd in the world by number of listed public companies –5th in the world in total equity raised –8th in the world by total listed company market capitalization

24. TSX Group is a World Leading Stock Exchange Source: Bloomberg Total Return 2002 to 2006 S&P/TSX Indices Outperform

25. TSX Group Niche Pre-Clinical Phase I Phase II Phase III/ RegulatoryApprovals TSX Venture Candidates TSX Candidates NASDAQ Candidates AIM Candidates

26. Market Comparison: TSX, Nasdaq, AIM

27. Where is Ontario? Life Science in Ontario Medical Devices in Ontario Direct Government Funding Ontario VC Fund Tax Savings & Rebates Government Loans for Advanced Manufacturing Public Offering Funding Additional Resources

28. Business Immigration Services –Personal consultations, networking opportunities, and introductions to other service providers. –Success Stories http://www.2ontario.com/bi/bi_successstories.asp http://www.2ontario.com/bi/bi_successstories.asp –Multinational Employee Transfer Guide –Business Start-up Resources Canada-Ontario Business Service Centre Small Business Enterprise Centres Streamlined on-line business registration

29. Additional Resources R&D Program Export Alliance Information Exchange Education Program partnerships MAT partnerships MAT funding opportunities How to: Roadmaps (i.e. Competitive Intelligence and Regulatory approval)

30. Don Van Dyke Raleigh, NC Business Development Consultant Ontario Ministry of Economic Development & Trade dvandyke@nc.rr.com (919) 345-2838