財團法人亞太金融研究發展基金會
Foundation of Pacific Basin Financial Research and Development
Panel Session XVII.
Capital Planning and Capital Market of Biotech Industry
創投(VC)與生技新藥製藥產業的相輔相成共生關係
Howard Lee Ph.D.
李 世 仁 博士
Easy Life Science Management, Inc.
July 9, 2011
EasyLife
1
SUMMARY
 Bioindustry is a globally recognized main stream
growing industry
 Venture Capital Fund vs. Knowledge Based
Industry
 Direct Financing Products/Capital Market Analysis
 Taiwan Healthcare Industry Opportunity
EasyLife
2
Worldwide consensus：
Knowledge-based Industries
Early 2009
 US - Barack Obama:
bioindustry、new energy、
internet-communication、infrastructure
 Taiwan - 劉 兆 玄：
bioindustry、green energy、
telecommunication、infrastructure
EasyLife
3
Executive Yuan: six growing focuses
in knowledge-based Industry
生技起飛 biotechnology
醫療照護 healthcare
精緻農業 agriculture
綠色能源 green energy
文化創意 culture
觀光拔尖 sightseeing
EasyLife
4
Biotechnology Index Chart in past 10 yrs
*BTK: AMEX Biotech Index, IXIC: NASDAQ Index, NBI: NASDAQ Biotech Index, DJI: Dow Jones Index
EasyLife
Source: Yahoo! Inc.
5
SUMMARY
 Bioindustry is a globally recognized main stream
growing industry
 Venture Capital Fund vs. Knowledge-Based
Industry
 Direct Financing Products/Capital Market Analysis
 Taiwan Healthcare Industry Opportunity
EasyLife
6
Innovative Source vs. Biotech Industry
Government
University
Research Institute
Hospital
Non-profit organization
Supply 85% innovative sources
Cradle of biotech industry
Death of Valley
Professional supports：incubation center、tech
transfer dept.、evaluation corp.
VC、Buyout fund、PE fund
Biotech Industry
EasyLife
Profit organization
Connection w/ financial industry
Connection w/ capital market
Connection w/ global biotech
industry cluster
7
Across Death of Valley
Firms play a key role in creating value from biomedical ideas by
finding opportunities for value creation and raising funding based
on the promise of value capture
EasyLife
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Venture Capital Fund vs. Knowledge Based Industry
EasyLife
Venture Capital
Venture capital may be regarded as an
equity investment where investors
expect significant capital gains in return
for accepting the risk they may lose all
their equity
EasyLife
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VC Fund vs. Direct Financing
Direct Financing vs. Indirect Financing
 Direct Financing (involve in corp. management)
- Equity Investment
 Indirect Financing (NOT involve in corp. management)
- Loan、Grant、Tax Incentive
UniMed
11
SUMMARY
 Bioindustry is a globally recognized main stream
growing industry
 Venture Capital Fund vs. Knowledge-Based
Industry
 Direct Financing Products/Capital Market Analysis
 Taiwan Healthcare Industry Opportunity
EasyLife
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Capital Market and Related Players
Private Market
Public Offering Market
IPO
VC
[VC Fund]
[Investment Bank]
[Hedge Fund]
M&A ,
[Buy-out Fund]
EasyLife
Public Security Market
Follow-on
PIPEs
Debt
[Mutual Fund]
Consolidation
[Private Equity Fund]
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Corp.
vs.
Capital
Market
BIO€ QUITY
Money Distribution in Capital Market
Mutual Funds
(Hedge Funds)
Private Equity Funds
Buy-out Funds
VC Funds
EasyLife
(Angel Fund)
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Capital Market Status decides Industry Type
 Large long term bio fund
Drug Industry
 Small short term bio fund
Medical Device Industry
 Small flexible Investment money
diversified
small and medium enterprise in biotech industry
EasyLife
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Drug vs. Medical Device
 High risk, high return
 Need long term money
 Need large smart money
 IPO vs. M&A
Biotech Drug
Development
HIGH
Total
Return
LOW
Medical
Devices
LOW
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Risk
“UnMet Need”
 Low risk, low return
 Early liquidity
 High IRR
 Early distributions
 IPO vs. M&A
HIGH
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Drug Development and Approval Process
•It takes 11 years on average for an experimental drug to travel from lab to medical chest.
•Only 5 in 5,000 compounds screened in preclinical testing make it to human testing.
•1 of these 5 tested in people is approved.
Preclinical
Phase I
Phase II
Phase III
Testing
Years
3.5
1
2
3
Test
Laboratory
20 to 80
100 to 300
1,000 to 3,000
Population and Animal
Healthy Volunteers Patient Volunteers
Patient Volunteers
Studies
Purpose Access safety
Determine
Evaluate
Verify effectiveness,
and biological F
safety and
effectiveness.
monitor adverse
activity
I
dosage
Look for side
reactons from
L
effects
long-term use
E
Expedited review: Phase II and III
combined to shorten approval
I
N
process on new medicines for serious
D
and life-threatening diseases.
% of all
new drugs
that pass
EasyLife
70%
of INDs
33%
of INDs
27%
of INDs
FDA
F
I
L
E
1
Approval
Phase IV
Total = 10.5
Post-marketing
safety monitoring
Review
Process
Large-scale
manufacturing
Distribution
N
D
A
Education
20%
of INDs
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Taiwan Biotech Industry : small & medium
enterprise with flexibility
食品生技
27%
農業生技
13%
環境生技
5%
特化生技
6%
生技服務業
13%
生物製劑
36%
2009 Taiwan Biotech Corp. Allotment
EasyLife
Source：MOEA經濟部生物技術與醫藥工業發展推動小組 2010
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Taiwan TSE「Biotech Healthcare」Sector-18 Listed
 Pharma：中化製藥(資本額NT$29.81億元)、永信藥品(資
本額NT$25.37億元) 、生達製藥、杏輝藥品、旭富、懷特
新藥(資本額NT$9.42億元)、台耀、中化生技
 Reagent：亞諾法
 Drug Store Channel：美吾華
 Functional Food：葡萄王、景岳
 Medical Device/Channel：五鼎、東貿、雃博、華廣
 Exercise Instrument：必翔、喬山
* Daily Trading Volume：200k~4,000k shares
EasyLife
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Taiwan OTC「Biotech sector」- 33 Listed
 Pharma/Functional Food：東洋藥品、濟生、晟德、
南光、中天、天良、健喬信元、生泰、永日、杏昌、德英
 Healthcare Service：盛弘、大學光學、訊聯、KY馬光
 CRO/Reagent：進階、聯上
 Marketing Channel/Functional Food：弘如洋、友華、
加捷、天騵
 Medial Device/Channel：精華、寶利徠、合世、百略 、紅
電、邦拓、聯合骨科、晶宇、太醫、優盛、泰博、曜亞
* Daily trading volume：50k~4,000k shares
EasyLife
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SUMMARY
 Bioindustry is a globally recognized main stream
growing industry
 Venture Capital Fund vs. Knowledge Based
Industry
 Direct Financing Products/Capital Market Analysis
 Taiwan Healthcare Industry Opportunity
EasyLife
21
台灣生技起飛鑽石行動方案
Taiwan Bioindustry Take-off Action Plan
Executive Yuan approved on 10/7/2009
SIC
BVC
資料來源：行政院科技顧問組
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台灣生技起飛鑽石行動方案
Taiwan Bioindustry Take-off Action Plan
 Direct and Proactive
- BVC (生技創投基金)
 Indirect and Passive
- TFDA
- SIC (生技整合育成中心)
- Integration of research Institutions
(經濟部產業化研發中心)
EasyLife
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Global Pharmaceutical Market Forecast
Sales
North
America
41%
Europe
27%
Emerging
Markets
13%
Japan
11%
Rest of World
8%
* Russia 2013 estimate based on September 2008 forecast
Source: IMS Health, Market Prognosis
Taiwan Bioindustry Opportunity
Taiwan is in critical position in between three largest
markets in the world
US
Taiwan
China
EasyLife
Japan
25
Howard Lee, Ph.D.
howardlee@silverbm.com
EasyLife