Association For Molecular Pathology et al v. United States Patent and Trademark Office et al

Filing 167

DECLARATION of DR. PHILIP R. REILLY in Support re: 61 MOTION for Summary Judgment., 152 MOTION for Summary Judgment.. Document filed by Myriad Genetics, Lorris Betz, Roger Boyer, Jack Brittain, Arnold B. Combe, Raymond Gesteland, James U. Jensen, John Kendall Morris, Thomas Parks, David W. Pershing, Michael K. Young. (Attachments: # 1 Exhibit 1, # 2 Exhibit 2, # 3 Exhibit 3, # 4 Exhibit 4, # 5 Exhibit 5, # 6 Exhibit 6, # 7 Exhibit 7)(Poissant, Brian)

D

ockets.Justia.com

BIO 2009 Member Survey "Technology Transfer & the Biotechnology Industry"

1
Tuesday, October 27, 2009 1

BIO 2009 Member Survey Technology Transfer & the Biotech Industry

· GOALS
·
Collect Information on Biotechnology Industry's Technology Transfer Portfolios

· · · ·
Tuesday, October 27, 2009

Who Do We In-License With? What Impact Does Bayh-Dole (Ability to In-License with Univ. and Fed. Gov.) Have on the Biotech Industry? How are In-License Opportunities Found & Agreements Structured? How Can We Help Ensure Effective Technology Transfer in the U.S.?
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2

BIO 2009 Member Survey Technology Transfer & the Biotech Industry

· KEY FINDINGS
· · · · · · ·
Tuesday, October 27, 2009

Majority of Companies Have License Agreements with Universities & Pharma/ Biotech Companies - Most of Which Are With U.S. Entities Majority of Companies Do Not Have License Agreements with Federal Government Half of the Companies Were Founded on the Basis of a License Agreement After Obtaining Initial License Companies' Employment Numbers Increase Companies Spend Several Years and Significant Amounts of Dollars Developing Licensed Technology Into Commercially Available Products Most University License Agreements Have Non-Commercial Research, Particular Field of Use, and Milestone Clauses Which Are Monitored to Ensure Compliance The Ability to Obtain an Exclusive License is Critical to the Ability to Research & Develop a Commercially Available Product 3
3

Profile of Survey Participants
· PROFILE OF PARTICIPANTS · Company Structure · Employees · Products · Revenues/Assets
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Tuesday, October 27, 2009 4

Profile of Survey Participants
Is Your Company Public or Private?
60

% of Companies

45

30

15

0

Public
Type of Company N=150 Companies 5
Tuesday, October 27, 2009

Private

5

150 BIO member companies participated in survey. 49% were public (N=74) and 51% were private (N=76).

Profile of Survey Participants
How Many Employees Does Your Company Have?
70 60

% of Companies

50 40 30 20 10 0 <100 101-1000 Number of Employees 6 >1000

Tuesday, October 27, 2009

6

The majority of these companies are small with fewer than 100 employees (63%). 54% had fewer than 50 employees. 19% had over 1000 employees.

Profile of Survey Participants
Does Your Company Have a Product on the Market?
50 62% - No Product on Market 35% - Product on Market 40

% of Companies

30

20

10

0 Private (No Product)
Tuesday, October 27, 2009

Public (No Product)

7

Private (Product)

Public (Product)
7

Most (62%) of the these companies do not yet have a commercial product (41% were private and 21% were public. 35% have a product on the market (6% were private and 29% were private). 3% gave no response (N/R)

Profile of Survey Participants
What Stage of Development is Your Lead Product In? (Companies with No Marketed Product)
35 30

% of Companies

25 20 15 10 5 0 Preclinical Phase I Phase II Phase III Market Phase Other No Response (N/R)

Phase of Development for Lead Product

8
Tuesday, October 27, 2009 8

56% of companies have lead products in Phase II and III stages of development.

Profile of Survey Participants
How Many Years From Having a Marketed Product?
40

30 % of Companies

20

10

0 <1 yr 1 to 3 yrs 3 to 10 yrs >10 yrs Already Marketing N/R Years From Market 9
Tuesday, October 27, 2009 9

Most companies with no marketed product are 3-10 years away from having a marketed product (34%). 35.3% of the companies surveyed have a product on the market.

Profile of Survey Participants
·
SUMMARY OF SURVEY PARTICIPANTS

· · ·

Represents a Mix of Public & Private Companies Most are Small Companies with No Product on the Market that are 3-10 Years Away from Commercialization. Over Half of Lead Products are in Phase II or III Stage of Development. Companies with Marketed Products Represent Mid and Large Biotech Companies
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Tuesday, October 27, 2009

Other Findings: 41% of companies' lead product is a small molecule and 24% have a large molecule protein lead product. 36% Have a Biologic Lead Product (Lg. Protein, Sm. Protein, Vaccine). Majority (65.4%) have 5 or less products in development. 28.7% have more than 6 products in development.

Biotechnology In-Licensing
·
BIOTECH IN-LICENSES

· · · · ·

Finding In-License Opportunities Stage of Development In-Licenses Occur Number of In-Licenses Exclusive vs. Non-Exclusive What Entities Biotech Has In-License Agreements With
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Tuesday, October 27, 2009

11

Finding Biotech In-Licensing Opportunities
Most Common Method of Identifying Licensing Opportunities
30 25

% of Companies

20

15

10

5

0
Conferences Colleagues Literature Sources Email/Call Tech Transfer Univ. Websites Fed. Gov. Websites Online Social Media Other N/R

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Tuesday, October 27, 2009 12

Conferences were the most common method of identifying licensing opportunities (30%) followed by colleagues (25%) and literature sources (24%).

Biotech In-Licensing
Companies with No Marketed Product At What Stage of Development Does Your Company Generally In-License a Product?
50 40

% of Companies

30 20 10 0 Preclinical Phase I Phase II Phase III Market Phase Other N/R

Phase of Development for In-Licensed Technology
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Tuesday, October 27, 2009 13

Almost half of the companies obtained a license in the pre-clinical stage (45%). 61% obtained license in preclinical or Phase I stage of development. NOTE: Other may represent licenses for compounds or manufacturing processes.

Biotech In-Licensing
How Important is Ability to Obtain Exclusive License to Ability to R&D a Commercially Available Product?
60

% of Companies

45

30

15

0 Extremely Important Very Important Somewhat Important Not At All Important N/R

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Tuesday, October 27, 2009 14

79% of companies surveyed said the ability to obtain an exclusive license is important to their ability to develop a commercially available product.

Biotech In-Licensing With U.S. Entities
What % of Company's In-License Agreements Are With U.S. Entities?
80 95%: Have License Agreements 5%: No License Agreements 60 % of Companies

40

20

0 None <5% 5-25% 26-50% 51-100% No Response % of In-License Agreements With U.S. Entities

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Tuesday, October 27, 2009 15

71% of companies have over half of their in-license agreements with U.S. entities. 45% have over 3/4ths of their in-license agreements with U.S. entities.

Biotech In-Licensing With Federal Government
What % of In-License Agreements Are with Federal Government?
70 60 % of Companies 50 40 30 20 10 0 None <5% 5-25% 26-50% 51-100% No Response % of In-License Agreements With Federal Government 16
Tuesday, October 27, 2009 16

23%: Have License Agreements 69%: No License Agreements

69% of the companies surveyed do not have an in-license agreement with the federal government. 19% of companies have less than 25% of their in-license agreements with the federal government.

Biotech In-Licensing With Universities
What % of In-License Agreements Are With Universities?
40 76%: Have License Agreements 27%: No License Agreements 30 % of Companies

20

10

0 None <5 5-25% 26-50% 51-100% No Response % of In-License Agreements With Universities/Research Institutions

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Tuesday, October 27, 2009 17

31.4% have over half of their in-license agreements with universities (19% have more than 3/4th of their in-license agreements with universities).

Biotech In-Licensing With Pharma/Biotech Companies
What % of In-License Agreements Are With Pharma/Biotech Companies?
50 40 % of Companies 30 20 10 0 None <5% 5-25% 26-50% 51-100% No Response % of In-License Agreements with Pharma/Biotech Companes 77%: Have License Agreements 19%: No License Agreements

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Tuesday, October 27, 2009 18

36% of companies stated that 3/4th of their in-license agreements are with pharma/biotech companies, 47% stated over 1/2 of their in-license agreements are with pharma/biotech companies.

Biotech In-Licensing
·
SUMMARY OF BIOTECH IN-LICENSING

· · ·

Licensing Opportunities are Found at Conferences, Among Colleagues and in the Literature Most Companies Obtain a License in Pre-Clinical or Phase I Stage of Development Ability to Obtain Exclusive License is Critical to Ability to Research & Develop a Publicly Available Treatment or Therapy
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Tuesday, October 27, 2009

19

Biotech In-Licensing
·
SUMMARY OF BIOTECH IN-LICENSE PARTNERS

· · ·
Tuesday, October 27, 2009

Most of In-License Agreements are with U.S. Entities Most have In-License Agreements with Universities/Research Institutions and Pharma/ Biotech Companies Most DO NOT have In-License Agreements with the Federal Government
20
20

Impact of In-Licensing on Biotech Industry
·
IMPACT OF IN-LICENSES ON BIOTECH INDUSTRY

· ·

Company History Company Resources

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Tuesday, October 27, 2009 21

Biotech In-Licensing & Company History
Was Your Company Founded On the Basis of Obtaining a License Agreement?
60 50 40 30 20 10 0

% of Companies

Yes

No

No Response

22
Tuesday, October 27, 2009 22

50% of companies were founded on the basis of obtaining a license agreement and 48% were not. 62% of private companies were founded on obtaining a license vs. 40% of public companies.

Biotech In-Licensing & Company History
Number of Employees Prior to Obtaining 1st Tech Transfer License # Employees All Private Public DK/ Refused 26% 10.8% 40.8% <5 51.4% 68.9% 34.2% <10 58.1% 77% 39.5% 6-15 10% 12.2% 5.3% >15 12.7% 8.1% 17.1%

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Tuesday, October 27, 2009 23

58.1% of companies had <10 employees prior to obtaining first tech transfer license.

Biotech In-Licensing & Company History
Number of Employees Added 1-2 yrs. & 2-5 yrs. After Obtaining 1st Tech Transfer License
# Employees All 1-2 yrs All 2-5 yrs Private 1-2 yrs. Private 2-5 yrs. Public 1-2 yrs. Public 2-5 yrs. <10 28.7% 19.3% 10-19 20% 10% 20-29 8.7% 8% 30-39 8% 4% 40-49 1.3% 6% 50-99 2.7% 12.7% 100-199 4% 5.3% >200 2.7% 6% DK/ Refused 24% 28.7%

47.3% 32.4% 10.5% 6.6%

27% 17.6% 13.2% 2.6%

6.8% 9.5% 10.5% 6.6%

9.5% 4.1% 6.6% 3.9%

1.4% 12.2% 1.3% 0%

0% 6.8% 5.3% 18.4%

0% 1.4% 7.9% 9.2%

0% 0% 5.3% 11.8%

8.1% 16.2% 39.5% 40.8%

2-5 Yrs. After Obtaining License Only 19.3% of Companies had Fewer than 10 Employees
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Tuesday, October 27, 2009 24

2-5 Yrs. after obtaining license only 19.3% of companies had fewer than 10 employees and 42% had between 10 and 100 employees.

Biotech In-Licensing & Company Resources
Companies with No Marketed Product
Avg. # of Yrs. (Projected or Actual) Company Will Spend on R&D for Lead Product from Initial License to Commercialization 80

60 % of Companies

40

20

0 < 5 yrs. 5-15 yrs. >15 yrs. No Response Yrs. Will Spend Developing Product NOTE: Figures Represent Small Molecule, Large Molecule and Diagnostic Lead Products 25
Tuesday, October 27, 2009 25

77.4% of companies without a marketed product stated it will take 5-15 yrs. to develop lead product from time of initial product to commercialization. 17% said it will take 2-5 yrs.

Biotech In-Licensing & Company Resources
Companies with a Marketed Product Avg. # of Yrs. Spent on R&D for Lead Product from Initial License to Commercialization
50 40 % of Companies 30 20 10 0 <5 yrs. 5-15 yrs. >15 yrs. No Response Yrs. Spent Developing Product NOTE: Figures Represent Small Molecule, Large Molecule and Diagnostic Lead Products 26
Tuesday, October 27, 2009 26

42% of companies stated it took between 5-15 yrs. to develop lead product into a marketed product 44% of companies stated it took < 5 years. 34% of companies with a marketed product stated it took 2-5 yrs.

Biotech In-Licensing & Company Resources
Companies With No Marketed Product 60% Project Will Spend > $100 M 15% Project Will Spend > $500 M Companies With a Marketed Product 39% Spent > $100 M 21% Spent > $500 M
NOTE: Figures Represent Small Molecule, Large Molecule and Diagnostic Lead Products 27
Tuesday, October 27, 2009 27

Impact of In-Licensing on Biotech Industry
·
SUMMARY IMPACT OF IN-LICENSES ON BIOTECH INDUSTRY

· · · ·
Tuesday, October 27, 2009

Half of Companies Were Founded on Basis of Obtaining a License Agreement Prior to Obtaining a License 58% of the Companies had < 10 Employees 2-5 Yrs. After Obtaining License Only 19% had <10 Employees Majority of Companies With No Marketed Product Expect to Spend 5-15 Years Developing a Product and Spend > $100 M
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Biotech In-License Agreements
·
BIOTECH IN-LICENSE AGREEMENTS

· · · ·

Length of Time to Complete Negotiations Hardest/Easiest Part of Negotiations Calculating Value In-License Payment Structures

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Tuesday, October 27, 2009 29

Biotech In-Licensing Negotiations
Avg. Amount of Time to Complete an In-License Agreement
50

% of Companies

40 30 20 10 0 0-3 mo. 3-6 mo. 6 -12 mo. 12-18 mo. 18-24 mo. >24 mo. No Response

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Tuesday, October 27, 2009 30

49% of companies stated it takes 3-6 mo. to complete a license agreement (31% stated it took 6-12 mo.) Same with public and private except more private companies stated it only took less than 3 mo. than public companies (12% vs. 1.3%).

Biotech In-Licensing Negotiations
What is the Hardest Part of In-Licensing Negotiations?
40

30
% of Companies

20

10

0
Monetary Terms Patents Diligence Requirement Background IP Exclusivity Termination Clauses Sub-License Provision Warranties

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Tuesday, October 27, 2009 31

36% of companies stated monetary terms are the hardest part of the negotiations. Exclusivity was second with 11% of companies id. this as the most difficult part of negotiations.

Biotech In-Licensing Negotiations
What is the Easiest Part of In-License Negotiations?
40

30 % of Companies

20

10

0
Confidentiality/Pub. Patents Monetary Terms Diligence Requirement Background IP Exclusivity Termination Clauses Sub-License Provision Warranties Know-How No Response

32
Tuesday, October 27, 2009 32

37% of companies stated confidentiality and publications were the easiest part of the negotiations followed by patents (13%).

Biotech In-Licensing Negotiations
Metric Your Company Typically Uses to Calculate Value of In-Licensing Opportunity
60

45 % of Companies

30

15

0 Future Rev. Approach Market Approach Cost Approach Other No Response

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Tuesday, October 27, 2009 33

The majority of companies stated they use the future revenue approach to calculate value (55%). A market approach was the second most common (22%). Future Revenue Approach was defined as discount to future cash flows, market approach was defined as value of comparative technologies/assets and cost approach was defined as dollars required to bring a product to market.

Biotech In-Licensing Payment Structures
Running Royalties On Product 73% Stated Over 1/2 of Licenses Include Running Royalties Upfront Payments 64% Stated Over 1/2 of Licenses Include Upfront Payment Milestone Payments 66% Stated Over 1/2 of Licenses Include Milestone Payments

34
Tuesday, October 27, 2009 34

90% of companies have running royalties provisions. 73% stated over 1/2 of their licenses and 62% stated over 3/4 of their licenses include running royalties. 64% of companies stated that over 1/2 of their licenses and 42% stated 9/10 of their licenses included upfront payments. 66% of companies stated that over 1/2 of their licenses and 45% stated 9/10 of their licenses included milestone payments.

Biotech In-Licensing Payments
How Much Has Your Company Paid Out on Royalty Payments?
50

40 % of Companies

30

20

10

0 <$25 M $25-$250 M > $250 M No Response Amount of Royalties Paid Out 35
Tuesday, October 27, 2009 35

49% of companies have paid out <$25 M, 16% have paid $25- $250 M, and 16% have paid out over $250 M. (19% DK/Refused - all public companies.)

Biotech In-License Agreements
·
SUMMARY OF BIOTECH IN-LICENSE NEGOTIATIONS

· · ·
Tuesday, October 27, 2009

49% of Companies Stated it Typically Takes 3-6 mo. to Complete Negotiations - 31% Stated it Takes 6-12 mo. Confidentiality/Publications was Identified as the Easiest Part of Negotiations and Monetary Terms as the Most Difficult 55% of the Companies Use Future Revenue Approach and 22% Use Market Approach to Calculate Value
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36

37% of companies said confidentiality was the easiest and 36% stated monetary terms was the hardest part of negotiations. Future Revenue Approach was defined as discount to future cash flows, market approach was defined as value of comparative technologies/assets and cost approach was defined as dollars required to bring a product to market.

Biotech In-License Agreements
·
SUMMARY OF BIOTECH IN-LICENSE PAYMENT STRUCTURES

· ·
Tuesday, October 27, 2009

Majority of Companies Have Payments Based on Milestones, Upfront Payments and Running Royalty Payments in Over 1/2 of License Agreements 49% of Companies Have Paid < $25 M in Royalties, 16% Have Paid $25-$250M and 16% Have Paid >$250 M
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37

Biotech In-Licensing With Universities
·
BIOTECH IN-LICENSING WITH UNIVERSITIES

· · · · ·
Tuesday, October 27, 2009

Exclusive vs. Non-Exclusive Non-Commercial Research Provisions Particular Field of Use Provisions Milestone Provisions Oversight
38
38

Biotech In-Licensing With Universities
60% of companies surveyed stated 3/4 of their inlicense agreements with universities are exclusive. 21.3% of companies stated less than 1/2 of in-license agreements with universities are exclusive. 5.8% of companies stated that none of their inlicense agreements with universities are exclusive.
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Tuesday, October 27, 2009 39

Biotech In-Licensing With Universities
57% of Companies Stated Exclusive License Agreements With Universities Include Non-Commercial Research Provisions (46% Stated Over 1/2 Include Non-Commercial Research). 53% of Companies Stated Exclusive License Agreements With Universities Include Limited Field of Use Provisions (42% Stated Over 1/2 of License Agreements Include Limited Field of Use). 67.6% of Companies Stated Exclusive License Agreements With Universities Include Milestone With Penalty or Revocations Provisions (59% Stated Over 1/2 of License Agreements Include Milestones).

40
Tuesday, October 27, 2009 40

Only 17% stated they had no exclusive license agreements with universities that did not contain noncommercial research provisions (N/R=27%). Only 31% stated they had no exclusive license agreements with limited field of use provisions (N/R=16%). Only 13% stated they had no exclusive license agreements with milestone provisions (N/R=9%)

Oversight of Biotech In-Licensing

31% of Companies Have Had a License Revoked, Restricted, Renegotiated or Paid a Penalty Due to Non-Compliance With Milestone Clauses

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Tuesday, October 27, 2009 41

21% of companies have had a license restricted or renegotiated, 7% have had a license revoked, and 3% have had to pay a penalty due to non-compliance with milestone clauses.

Biotech In-Licensing With Universities
·
SUMMARY OF BIOTECH IN-LICENSES WITH UNIVERSITIES

· · ·

Majority of In-License Agreements are Exclusive But There Are Significant Numbers of Non-Exclusive Licenses Majority of In-License Agreements Have Non-Commercial Research Provisions, Milestones w/Penalties and Particular Field of Use Provisions 31% of Companies Have Had a License Revoked, Restricted, Renegotiated or Paid a Penalty Due to Non-Compliance With Milestone Clauses
42

Tuesday, October 27, 2009

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