1. 1 McMaster Presentation June 20, 2002 Shameze Rampertab

2. 2 Agenda A. The financing landscape B. Views from an analyst C. Financing D. My criteria

3. 3 A. The financing landscape

4. 4 Financings Source: Ernst & Young

5. 5 Financings by province Source: Ernst & Young

6. 6 Distribution of biotech companies Source: Ernst & Young

7. 7 Financings by type Source: Ernst & Young

8. 8 Financings by stage Source: Ernst & Young

9. 9 IPOs in 2001 Source: Ernst & Young

10. 10 B. Views from an analyst

11. 11 Great Ideas and Great Technology….Does Not Make a Good Business If I had a dime for every great idea What did we learn from the telecom crash? No one will fund a science project Business is all about making money No one cures disease

12. 12 Good Entrepreneur Understand market reality Sense of urgency Exit strategies for investors Team oriented

13. 13 Dotcom … risk aversion Who will pay? Why will they pay? How much will they pay? Looking over your shoulder

14. 14 Business Plan Holes Management bios Audited financial statements Assessment of competition Financial projection assumptions Multiple projection scenarios Capital needed, and use of proceeds Real world product/service use

15. 15 What not to do Over-promise Expand beyond your expertise Lose focus Pure novelty

16. 16 Key ideas to consider as putting together business proposal Executive summary SWOT analysis Background information on sector KISS

17. 17 Healthcare gaps in need of innovation Improved safety profile Pharmacokinetics Drug delivery Toolboxes …. Acquisition Computer modeling Automated lab techniques

18. 18 C. Financing

19. 19 Other Capital Angel investors Strategic partnering Non-equity Asset financing Royalties Securitization of SRED Convertible debt LP

20. 20 Venture Capital Initial financing Subsequent financing Assemble executing teams

21. 21 D. My criteria

22. 22 Criteria Public 1) Validated science 2) Management’s commercialization strategy 3) Big market 4) In the clinic 5) Pending big pharma 6) Pipeline 7) Valuation

23. 23 Criteria Private 1) Validated science 2) Big market 3) Existing VC investor 4) Succession strategy 5) Valuation

24. 24 Knowledge Now you know all I know. Good luck!