11. OPHTHALMOLOGY INNOVATION SUMMIT
Advisory Board
Emmett T. Cunningham, Jr. MD
Partner
Clarus Ventures
William Link, PhD
Managing Director
Versant Ventures
Anthony Adamis
Professor of Ophthalmology
& Visual Science
University of Illinois
Mark S. Blumenkranz, MD
Professor & Chairman
Dept. of Ophthalmology
Stanford University
Brook Byers
Partner
Kleiner Perkins Caufield & Byers
Eugene de Juan, Jr., MD
Founder & Vice Chairman
ForSight Labs, LLC
Angela McFarlane
President & CEO
ForSight Labs, LLC
Lutz Giebel, PhD
Managing Partner
SV Life Sciences
David Guyer, MD
Partner
SV Life Sciences
Roman G. Rubio, MD
Medical Director,
Ophthalmology
Genentech
Charles Warden
Managing Director
Versant Ventures
Gilbert Kliman, MD
General Partner, Life
Sciences
InterWest Partners
Samir Patel, MD
President & CEO
OphthoTech
Scott M. Whitcup, MD
EVP, R&D, and Chief
Scientific Officer
Allergan, Inc.
12. OIS….quite a journey
• Today is our 12th OIS meeting….
• Inaugural OIS@AAO meeting 2009 in San Francisco
– AAO has been a great partner
• Inaugural OIS@ASCRS meeting in 2012 in Chicago
– ASCRS has been a great partner
12
16. OIS….quite a journey
• Today is our 12th OIS meeting….
• Inaugural OIS@AAO meeting 2009 in San Francisco
– AAO has been a great partner
• Inaugural OIS@ASCRS meeting in 2012 in Chicago
– ASCRS has been a great partner
• Inaugural OIS@ASRS meeting will be this
year…August 8th in San Francisco
– ASRS will be a great partner
16
17. Innovation in Ophthalmology
• Innovation Cycle- review of the stages
• Principles of Innovation
• Constituents involved in (required for) innovation
• External environment—impact on innovation
17
18. Innovation Cycle – Surgical Ophthalmic Technologies
Observation
& Invention
Product
Dev/Pre-
Clinical
Iterate/
Refine
Human
Proof of
Concept
Iterate/
Refine
CE Mark/
OUS Market
Dev.
FDA
Approval
U.S./Global
Market Dev.
Source: Market Scope
19. Innovation Cycle – Surgical Ophthalmic Technologies
1 2 3 4 5 6 7 8 9 10 11 12
Observation/Invention
Years
Product Dev/Pre-Clinical Phase – 1-3 yrs
Human Proof of Concept – 1-3 yrs
FDA Approval / U.S. / Launch
Successful Global
Commercialization
FDA Study - 1-2 yrs 510K, 4-6 yrs PMA
Refinement – 1-2 yrs
CE Mark/OUS Market Dev
ValueCreation
20. Lab
Research
Pre-clinical
In vitro
In vivo
Phase I
Clinical
Trials
Phase II
Clinical
Trials
Phase III
Clinical
Trials
FDA
Approval
OUS
Regulatory
Approvals
Global
Market Dev.
Innovation Cycle – Ophthalmic Pharma & Biopharma
Source: Market Scope
21. Innovation Cycle – Ophthalmic Pharma and Biopharma
1 2 3 4 5 6 7 8 9 10 11 12
Laboratory Research
Years
Pre-clinical In vitro & In vivo – 1-3 yrs
Phase I Clinical Trials – 1-3 yrs
OUS Approval
Global
Commercialization
FDA Approval
Phase II Clinical Trials– 1-3 yrs
Phase III Clinical Trials 2-4 yrs
ValueCreation
26. 26
Principles of Innovation
• Focus on important issues (big markets)
• Seek the truth
• Be disciplined
• Try things-when in doubt….try it
27. 27
Principles of Innovation
• Focus on important issues (big markets)
• Seek the truth
• Be disciplined
• Try things-when in doubt….try it
• Be willing to fail
28. 28
Principles of Innovation
• Focus on important issues (big markets)
• Seek the truth
• Be disciplined
• Try things—when in doubt….try it
• Be willing to fail
• Don’t be paralyzed by mistakes
29. 29
Principles of Innovation
• Focus on important issues (big markets)
• Seek the truth
• Be disciplined
• Try things—when in doubt….try it
• Be willing to fail
• Don’t be paralyzed by mistakes
• Be skilled
30. 30
Principles of Innovation
• Focus on important issues (big markets)
• Seek the truth
• Be disciplined
• Try things—when in doubt….try it
• Be willing to fail
• Don’t be paralyzed by mistakes
• Be skilled
• Be aggressive and assertive, but not arrogant
31. 31
Principles of Innovation
• Focus on important issues (big markets)
• Seek the truth
• Be disciplined
• Try things—when in doubt….try it
• Be willing to fail
• Don’t be paralyzed by mistakes
• Be skilled
• Be aggressive and assertive, but not arrogant
• Professionalism pays off
32. 32
Principles of Innovation
• Focus on important issues (big markets)
• Seek the truth
• Be disciplined
• Try things—when in doubt….try it
• Be willing to fail
• Don’t be paralyzed by mistakes
• Be skilled
• Be aggressive and assertive, but not arrogant
• Professionalism pays off
33. 33
Where Does Innovation Happen?
• Wherever the innovators are….and where the culture
fosters innovation
• Corporate Culture of Innovation
– Knows that innovation drives value
– Does not punish mistakes
– Knows it is NOT all about My ideas…others’ ideas have merit
– Balances internal with external innovation
– “Not invented here” attitude stifles innovation
34. Innovation Cycle-Key Contributors
1. Inventor/entrepreneur/team
2. Clinicians-early adopters
3. Financial Partners--Venture Capitalist, etc.
4. Industry leaders- commercial team
36. Trends in Healthcare
Investments and Exits 2016
Investor Confidence and Innovation Drive
Healthcare Venture to New Heights
Written by
Jonathan Norris
Managing Director
Silicon Valley Bank
M 650.575.1377
jnorris@svb.com
@jonnysvb
Paul Schuber
Valuations Associate
SVB Analytics
Caitlin Tolman
Senior Associate
Silicon Valley Bank
37. 37
2015: Another Banner Year for Healthcare
At the start of 2015, it was hard to imagine that we would have another
year as successful as 2014. And yet, by most measures, 2015 came very
close.
.
Despite the slowdown in Q4, the healthcare industry is poised for a
strong 2016, though activity likely will not match 2015.
38. 38
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
$0
$5
$10
$15
$20
$25
$30
$35
$40
$45
$50
$55
$60
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 3Q'15
$Billions
U.S. Healthcare Venture Investment Hits 15-Year High
Healthcare as Percentage of Total Venture Investment
Venture investments in healthcare were projected to reach $9.4 billion in 2015, the highest level since 2000.
Biopharma venture investments reached a record $7 billion, and device remained steady at $2.4 billion.
$105
Total VC$ % Biopharma % Device
*Projected total for 2015
Source: PricewaterhouseCoopers, Thomson Reuters and SVB proprietary data
Thomson Reuters data includes life science and dx/tools in biopharma and device categories.
2015*
39. 39
46 45 45
17
0
40
80
120
#ofDeals
Biopharma Series A Investment Dollars Surge while
Device and Dx/Tools Struggle
Source: VentureSource, PitchBook, CB Insights and SVB proprietary data
76
59
81
97
0
40
80
120
2012 2013 2014 2015#ofDeals
Total Series A ($M) $776 $1,102 $823 $1,871
CVC Deals % / # 22% / 17 29% / 17 27% / 22 29% / 28
BIOPHARMA
35 34 39
22
0
40
80
120
#ofDeals
Total Series A ($M) $212 $215 $327 $96
CVC Deals % / # 9% / 3 18% / 6 15% / 6 32% / 7
DEVICE
Total Series A ($M) $331 $257 $354 $165
CVC Deals % / # 4% / 2 11% / 5 9% / 4 24% / 4
DX/TOOLS
U.S. Company Formation: Deals and Investments in Series A
41. 41
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
20.0
22.0
24.0
2009 2010 2011 2012 2013 2014 2015
TotalValue($Billions)
2015 Sets Record for Healthcare Investment Returns
Pre-Money
IPO Value ($B)
$0.1 $1.8 $1.2 $2.1 $8.8 $12.1 $11.6
Big Exit
Upfront
Payments ($B)
$4.5 $4.1 $6.6 $4.3 $5.4 $8.0 $9.9
Big Exit
Milestones
($B)
$0.9 $1.1 $1.0 $1.8 $0.8 $1.0 $2.2
Pre-Money IPO Value
Big Exit Milestones to be
Earned
Big Exit Upfront Payments
Source: Investment bank research, VentureSource press releases, CB Insights, and discussions with life science
professionals
Potential Distributions from VC-Backed IPOs and Big Exit M&A 2009-15
42. 42
2016 Outlook: 2015 Will Be a Hard Act to Follow
As 2015 closed, we saw some decline in exit activity and investor interest that
indicate things are slowing. Here are our predictions for 2016:
• The biopharma IPO window should remain open, but there will be fewer
IPOs,
• M&A will continue on pace as acquirers seek biopharma companies to
replenish their pipeline
• Device IPO activity will decline, M&A activity will likely remain stable.
We believe this will lead to increased deal values and returns to
investors.
• We anticipate continued acquisition flurries, similar to Q3 2015, as
acquirers are pressured to innovate.
45. Innovation in Ophthalmology
--Financial Outlook
• Venture financing in healthcare has regained
momentum…
• IPO activity picked up in 2013 and 2014….remained
strong in 2015…will be more moderate in 2016
45
46. Innovation in Ophthalmology
--Financial Outlook
• Venture financing in healthcare has regained
momentum…
• IPO activity picked up in 2013 and 2014….remained
strong in 2015…will be more moderate in 2016
• M&A activity remains strong, but is impacted by
industry changes/consolidation
46
47. Innovation in Ophthalmology
--Financial Outlook
• Venture financing in healthcare has regained
momentum…
• IPO activity picked up in 2013 and 2014….remained
strong in 2015…will be more moderate in 2016
• M&A activity remains strong, but is impacted by industry
changes/consolidation
• Relative Attractiveness of the Ophthalmic Sector is
solid….
47
48. Innovation in Ophthalmology
--Financial Outlook
• Venture financing in healthcare has regained
momentum…
• IPO activity picked up in 2013 and 2014….remained
strong in 2015…will be more moderate in 2016
• M&A activity remains strong, but is impacted by
industry changes/consolidation
• Relative Attractiveness of the Ophthalmic Sector is
solid….
48
52. Innovation in Ophthalmology
• Still immense unmet needs
• Innovation resources focused where they are rewarded
• Key Constituents….entrepreneurs; clinicians; VCs and
Industry…..strong and more connected than ever
53. Innovation in Ophthalmology
• Still immense unmet needs
• Innovation resources focused where they are rewarded
• Key Constituents….entrepreneurs; clinicians; VCs and
Industry…..strong and more connected than ever
• Innovation in the ophthalmic sector is gaining, not losing
momentum
54. Innovation in Ophthalmology
• Still immense unmet needs
• Innovation resources focused where they are rewarded
• Key Constituents….entrepreneurs; clinicians; VCs and
Industry…..strong and more connected than ever
• Innovation in the ophthalmic sector is gaining, not losing
momentum
• Thanks to all who are committed….because when we
do well, many people benefit!!