NCI SBIR Funding for Technology Development Presentation at DP Clinical

1. NCI SBIR Funding for Technology DevelopmentPresentation at DP Clinical David Beylin Program Director NCI SBIR Development Center March 26, 2010

2. Today’s Presentation • Program Overview • SBIR Funding Opportunities • NCI SBIR Development Center • New SBIR Bridge Award

3. Overview

4. NCI SBIR Focus: Commercializing Innovation Therapeutics Medical Devices Research Tools eHealth Cancer diagnosis, treatment, research 4

5. Program Descriptions • SBIR: Set-aside Program for Small Business Concerns to engage in Federal R&D with potential for commercialization • STTR: Set-aside Program to facilitate Cooperative R&D between Small Business Concerns and U.S. Research Institutions with potential for commercialization Set Aside 2.5% 0.3% A $108M Program at the NCI

6. SBIR & STTR: Three-Phase Program • PHASE II – R42, R44 • Full Research/R&D • $750K and 2-year Award (SBIR & STTR) * • Commercialization plan required • PHASE III • Commercialization Stage • Use of non-SBIR/STTR Funds PHASE I – R41, R43 • Feasibility Study • $100K and 6-month (SBIR) * • or 12-month (STTR) Award * These funding levels are guidelines. You should request the budget appropriate to accomplish the goals of the project.

7. Reasons to Seek SBIR & STTR Funding • Provides seed funding for innovative technology development projects • A stable and predictable source of funding • Intellectual property rights are retained by the small business concern • Not a loan – no repayment is required • Doesn’t impact stock or shares in any way (no dilution of capital) • Provides recognition, verification and visibility • Can be a leveraging tool to attract other funding (VC, etc.)

8. SBIR Eligibility Requirements • Small Business Concern • Organized for-profit U.S. business • 500 or fewer employees, including affiliates • Must be: • At least 51% U.S.- owned by individuals and independently operatedor • At least 51% owned and controlled by another (one) business concern that is at least 51% owned and controlled by one or more individuals • Principal Investigator’s primary employment must be with the Small Business Concern

9. STTR Eligibility Requirements • Applicant is a Small Business Concern • Formal Cooperative R&D Effort • Minimum 40% by small business • Minimum 30% by U.S. research institution • U.S. Research Institution • College or University • Other non-profit research organization • Federal R&D center • Intellectual Property Agreement • Allocation of IP rights and rights to carry out follow-on R&D and commercialization • Principal Investigator’sprimary employment may be with either the Small Business Concern or the research institution

10. SBIR Funding Opportunities(Phase I & II)

11. SBIR Solicitations • SBIR/STTR Omnibus Grant Solicitation (NIH) • Release:January • Receipt Dates:April 5, August 5, and December 5 • Technology Areas: All, investigator-initiated R&D • SBIR Contract Solicitation (NIH, CDC) • Release:August • Receipt Date:November 9, 2009 [CURRENTLY CLOSED] • Technology Areas: See 23 published NCI contract topics • Image-Guided Cancer Interventions (NCI) • Recently Expired PAs: PA-07-041, PA-07-042 • Release: January 2010 • Receipt Date:April 5, 2009 • Technology Areas: IGD, IGT, IGS

12. Selected SBIR Contract Topics in 2009 • Development of Anticancer Agents • Nanotechnology Imaging Agents or Devices for Improved Detection of Cancer • Biopsy Instruments and Devices that Preserve Molecular Profiles in Tumors • Innovative Devices to Protect Radiosensitive Organs and Structures During Radiation Therapy • Quantitative Cell-Based Imaging For Clinical Diagnosis and Treatment • … • Full List of 23 Topics: • http://sbir.cancer.gov/funding/past/contracts/PHS2010-1.asp • Next contract solicitation will be released in August of 2010 (sign-up for updates at http://sbir.cancer.gov)

13. Goal: develop companion diagnostics to select patients in whom a particular therapeutic regimen, including existing drugs and those in late clinical development, will be safe and effective Fast-Track proposals allowed: yes Budget: $200,000 Phase I; $1,500,000 Phase II; < 4 awards anticipated Phase I activities and deliverables: Develop a working diagnostic test. Characterize the variation, reproducibility, and accuracy of the test Demonstrate suitability of the test for use in the clinic, conduct benchmarking studies against current tests (if available). Topic 277: Companion Diagnostics- Predictive and Prognostic Tests Enabling Personalized Medicine

14. Phase II Activities and Deliverables: Demonstrate clinical utility and value by testing sufficient numbers of patients for statistical significance regarding patient selection for the therapy. Perform correlation studies between any animal models and treatment in human subjects, if applicable Establish a marketing partnership or alliance, as appropriate, with the pharmaceutical company that is developing or selling the therapy, unless the therapy is on the open market. Deliver the final SOP to NCI. Topic 277: Companion Diagnostics- Predictive and Prognostic Tests Enabling Personalized Medicine, cont

15. Grant Portfolio (Recent Snapshot) 15

16. NCI SBIR Development Center

17. SBIR Development Center Old SBIR Management Model at NCI • Awards were managed by 40-50 people who each spent a small amount of their time on SBIR (currently the model at other NIH Institutes) • Few of these NCI program managers had significant industry experience or commercialization expertise New Development Center at NCI • Team of 8 Program Directors and the Center Director • Exclusively focused on the management of NCI’s SBIR/STTR portfolio • Program Directors have previous industry experience and professional networks to help mentor awardees in commercialization strategy and process • Center is developing a range of new activities to help small businesses 17

18. SBIR Development Center Staff • Ali Andalibi,PhD(Branch Chief) • Previous • NSF – SBIR Program Director, Medical Biotechnology • House Ear Institute – Scientist & Director, New Technology and Project Development • Trega Biosciences, Inc. – Research Scientist • Michael Weingarten,MA(Director) • Previous • NASA – Program Manager, NASA Technology Commercialization Program • Greg Evans,PhD(Branch Chief) • Previous • NHLBI/NIH – Program Director, Translational and Multicenter Clinical Research in Hemoglobinopathies • NHGRI/NIH – Senior Staff Fellow • Natalia Kruchinin, PhD(Program Director) • Previous • QIAGEN, Inc. – Molecular Diagnostics Applications Manager • Motorola, Inc. – Senior Scientist, Gene Expression Assays • Patti Weber, DrPH(Program Director) • Previous • International Heart Institute of Montana –Tissue Engineering and Surgical Research • Ribi ImmunoChem Research, Inc. – Team Leader, Cardiovascular Pharmacology • Andrew J. Kurtz,PhD(Program Director) • Previous • NIH – AAAS Science & Technology Policy Fellow • Cedra Corporation – Research Associate, Bio-Analytical Assays and Pharmacokinetics Analysis • Jian Lou, PhD(Program Director) • Previous • Johnson & Johnson – Research Scientist, Target Validation & Biomarker Development • Lumicyte, Inc. – Director, Molecular Biology Systems Analysis • David Beylin,MS, MBA(Program Director) • Previous • X/Seed Capital Management, LLC, EIR • Naviscan PET Systems, Inc., Vice President, Research • Todd Haim, PhD(Program Analyst / AAAS Fellow) • Previous • National Academy of Sciences – Christine Mirzayan Science and Technology Policy Fellow • Pfizer Research Laboratories – Postdoctoral Fellow, Cardiac Pathogenesis & Metabolic Disorders • Deepa Narayanan, MS(Program Director) • Previous • Naviscan PET Systems, Inc., Director, Clinical Data Management (Oncology Imaging & Clinical Trials) • Fox Chase Cancer Center, Scientific Associate (Molecular Imaging Lab)

19. Mentoring and Facilitation Goal To work closely with promising SBIR Phase II awardees in order to advance their technologies towards the clinic. Path Mentor and guide companies throughout the award period. Hold an annual SBIR Investor Forum to learn more about portfolio companies, encourage inter-company collaborations/partnerships, and showcase to investors. When appropriate, act as a liaison to bring investors (VC, angels, strategic partners) and NCI SBIR companies together.

20. NCI SBIR Investor Forum(available to NCI Phase II grantees )

21. NCI SBIR Investor Forum • Exclusive opportunity for 14 NCI awardees to showcase their companies to investors • http://sbir.cancer.gov/investorforum/ • Featured Small Businesses • Present to and network with close to 200 top investors and strategic partners • Participate in panel discussion with successful Bridge awardees and their investors • Investors • Opportunity to evaluate NCI’s top companies with innovative technologies • Exclusive one-on-one meetings • Follow-Up discussions, MTA’s and Due Diligence now underway 21

22. Investor Forum Participants Strategic partners Investors Other Organizations and Media

23. Regulatory Assistance Program(available to NCI Phase II grantees )

24. Regulatory Assistance Goal Regulatory assistance Scope Preparation for IND, PMA, BLA, IDE, 510(k) submission. cGMP, QSR, CLIA Eligibility SBIR/STTR Phase II Awardees Path 30+ hours of consulting time Consultant works under NCI contract Launch TBA soon

25. New SBIR Bridge Award

26. Phase II SBIR andCommercialization Success • Significant resources are required for getting through the FDA approval process • This funding gap is known as the “Valley of Death” Today, many awardees complete the SBIR Phase II award without advancing the technology far enough to attract private investment

27. SBIR & STTR: Three-Phase Program PHASE I – R41, R43 Feasibility Study $100K and 6-month (SBIR) * or 12-month (STTR) Award • PHASE II – R42, R44 • Full Research/R&D • $750K and 2-year Award (SBIR & STTR) * • Commercialization plan required Phase II Bridge Award • PHASE III • Commercialization Stage • Use of non-SBIR/STTR Funds * Note: Actual funding levels may differ by topic. 27

28. Follow-on to SBIR Phase II Goal to help early-stage companies cross the “Valley of Death” by: Incentivizing third-party investment earlier in the development process by Sharing in the investment risk with third-party investors RFA Incentive Structure Gives competitive preference and funding priority to applicants that can raise substantial third-party funds (i.e., minimum 1:1 match) Affords NIH the opportunity to leverage millions in external resources Third-party investors are also expected to provide valuable input in several ways: Rigorous commercialization due diligence prior to award Commercialization guidance during the award Additional financing beyond the Bridge Award project period SBIR Phase II Bridge Award 28

29. RFA Highlights Mechanism & Budgets Uses the SBIR Phase II (R44) competing renewal mechanism Provides up to $1 M per year for up to 3 years Available to current Phase II grant awards, and those that ended within last 2 years Preferred Third-Party Matching Funds Cash, liquid assets, convertible debt Sources of Funds Another company, venture capital firm, individual “angel” investor, foundation, university, state or local government, or any combination 29

30. Example: How the Bridge Award Would Apply in the Area of Drug Development Phase I & Phase II SBIR The “Valley of Death” is the problem Preclinical Development (Lead Development, Animal Studies, File IND) Target Identification & Validation Safety Review Clinical Trials NDA Review Commercialization Private Investment

31. Example: How the Bridge Award Would Apply in the Area of Drug Development Phase I & Phase II SBIR SBIR Bridge Award STOP STOP 2nd Year 1/3 of funds 1st Year 1/3 of funds 3rd Year 1/3 of funds YES YES • Milestones reached? • Matching Funds? • Milestones reached? • Matching Funds? • Milestones reached? • Matching Funds? NO NO Preclinical Development (Lead Development, Animal Studies, File IND) Target Identification & Validation Safety Review Clinical Trials NDA Review Commercialization SBIR Bridge Award Private Investment

32. FY2009 Bridge Awards 32

33. Lpath Therapeutics, Inc. • Commercialization of ASONEP™ for the treatment of cancer • First-in-class, systemic formulation of a humanized monoclonal antibody which neutralizes the angiogenic growth factor, sphingosine-1-phosphate (S1P) • Third Party Funding • A major pharmaceutical firm has committed 6 the Bridge funding for the current activities • Following the Bridge, this strategic partner is prepared to support development through Phase II and Phase III clinical trials “…the applicant is putting into place… pre-clinical and clinical biomarker validation studies… to drive tumor type and patient selection decisions…” -Reviewer 33

34. Optosonics, Inc. • Photoacoustic CT for preclinical molecular imaging • Large potential market in the area of preclinical drug development • Third Party Funding • A new company founded by an established VC firm and a team of pharma leaders will match the Bridge funding • Third-party Investors are knowledgeable about the customer base and can leverage their expertise to provide commercialization guidance “…the innovation… is advancing the state-of-the-art in PCT and its commercialization…” -Reviewer 34

35. Expanded Technical Scope(FY10 reissuance) Therapeutics Anticancer drugs and drug delivery systems Small molecules, biologics and vaccines Devices for Cancer Therapy Devices for therapeutic (anticancer) use of ionizing radiation Other ablative techniques Imaging Technologies Medical devices for in vivo cancer imaging Image-guided interventions (e.g., biopsy, surgery, drug delivery) Imaging agents Cancer Diagnostics In vitro diagnostics Any other diagnostic modality 35

36. More Information onNCI SBIR & STTR Website http://sbir.cancer.gov

37. Register on web site for funding opportunity updates http://sbir.cancer.gov http://sbir.cancer.gov David Beylin, MS, MBA Program Director Phone: 301-496-0079 beylind@mail.nih.gov