Programs for Biotech Startups Programs for Biotech Startups
How to design a program and its mentoring for biotech startups.
What this presentation covers
What this presentation covers
What this presentation covers
The odds of approval
Most drug programs never reach patients
Only 13.8% of drug programs went from Phase 1 to approval; in oncology, 3.4%.
Success by phase
Each phase drops a third or more
Two in three programs clear Phase 1; under six in ten clear Phases 2 and 3.
- Phase 1 to 2 66.4%66.4%
- Phase 2 to 3 58.3%58.3%
- Phase 3 to approval 59.0%59.0%
Years in the clinic
Clinical trials take years
Median trial length rises from 1.6 years in Phase 1 to 3.8 in Phase 3.
- Phase 1 1.6 years1.6 years
- Phase 2 2.9 years2.9 years
- Phase 3 3.8 years3.8 years
Capital needs
Drug development needs patient capital
Counting failures and the cost of capital, one approved drug cost $2,558 million.
- Out of pocket $1,395M$1,395M
- With cost of capital $2,558M$2,558M
- Plus post-approval R&D $2,870M$2,870M
Biomarkers and success
Biomarker selection improves the odds
Trials that used biomarkers to select patients had higher overall success rates.
- With biomarker selection almost twice the success
- Without the lower baseline
Lab access
Give founders bench space, not just desks
Wet labs and core equipment cost too much for one seed-stage team, so share them.
- Shared wet lab benches by the month
- Core equipment sequencing, imaging, cell culture
- Biosafety support permits and training
- Contract research vetted partners
IP and tech transfer
Settle the license before the round
US universities may keep title to federally funded inventions and must prefer small firms in licensing.
- University may keep title 35 U.S.C. 202(a)
- Small firms first in licensing 202(c)(7)(D)
- Program check license terms clear before a raise
Regulator support
EMA cuts fees for small firms
SMEs pay 10% of EMA’s scientific advice fee and can defer the marketing authorization fee.
- 90% off scientific advice
- Marketing authorization fee deferred
- Orphan products: advice fee waived
- Micro firms: post-authorization fees waived
The mentor pool
Mentors from the lab to the market
Mix translational scientists with people from regulatory, manufacturing, clinical operations and licensing.
- Translational science target to candidate
- Regulatory affairs scientific advice, filings
- Manufacturing process and quality
- Business development licensing and partners
Milestones to track
Track science milestones, not only rounds
Biotech value moves in steps, so ask startups to report each one.
- Target validated data package
- Lead candidate molecule chosen
- Trial application IND or CTA filed
- First patient dosed Phase 1 starts
- Partner deal license or co-development
Sources
The research behind this presentation
- Wong, C. H., Siah, K. W. & Lo, A. W. (2019) Estimation of clinical trial success rates and related parameters Biostatistics, 20(2), 273-286
- DiMasi, J. A., Grabowski, H. G. & Hansen, R. W. (2016) Innovation in the pharmaceutical industry: New estimates of R&D costs Journal of Health Economics, 47, 20-33
- United States Congress (2023) 35 U.S.C. 202, Disposition of rights (Bayh-Dole Act) United States Code, 2023 edition, Title 35, Chapter 18, U.S. Government Publishing Office
- European Medicines Agency (2026) Financial advantages of SME status European Medicines Agency, support for SMEs
Design for the long road
Share labs, settle IP early and plan the capital in stages.