Selling the VisionEarly stage financial communications for life sciences

The situation

Crowded space

66

62

76

39

404

118

700+ companies in Canada and US

Looking at biotechs

1,400 biotechs in US 532 in Canada 1,570 in EU Growth sector in India, China and Brazil

Life sciences venture capital

31 VC firms in Canada (1:45) 85 VC firms in US (1:16) 220 VC firms in EU (1:7)

Canada - $583 million in financings ‘07 US - $10 billion in financings ‘08

Looking ahead to 2009-2010

“Dark Age Ahead for European Biotechs” “Canadian IPO Market Worst in 10 Years” “US Biotech Financing to Reach Record

Decade Low”

Expect “Darwinian change.”

- Mark Heesen, President, NVCA

Financing

Capital for the life sciences

R&D is capital-intensive Biotechs are ‘cash pigs’ Burn rate – rate of consumption of cash Time to failure = cash reserves + expected raises ÷ burn

rate

Seed capital Private equity Private equity,partnership

IPO

Discovery Pre-clinical Phase I Phase II

Applications

Private equity – seed to late stage financings Initial public offerings Follow-on/secondary financings Debt financings Mergers & acquisitions activity Government financings/grants Partnering

Communicating effectively

My ‘theoretical orientation’

This is about marketing At the end of the day it’s a sales pitch We are selling a stake in the future

financial benefit of intellectual property “Upside potential”

“Nothing happens until something gets sold.”

- Bob Metcalfe, founder, 3Com

Tools

Website Investor presentation – the ‘pitch document’ Collateral materials – the ‘leave-behind’

Goals

Hook the audience on your story

Spark a conversation Set the stage for your

investment bankers to close the deal

Principles

Know your audience Develop a compelling

story Choose the right

spokesperson Use all

available/suitable tools to tell your story

Create opportunities for your story to ‘echo’

Know your audience

You will be talking to: Investment bankers Fund managers Research analysts Financial media

In life sciences many will have PhDs in scientific or medical disciplines

Many will have had industry experience Often sit on advisory boards for portfolio companies

Tailor each presentation to suit the audience’s level of knowledge Be prepared to supplement presentation information

Build a compelling story

Start with the elevator pitch… if you are on an elevator with a potential investor how would you describe your opportunity in the time it takes the elevator to reach the ground floor?

Use broad strokes, not exhaustive detail Trim your presentation to 25 minutes or less Typical hooks

Unmet medical need – Genzyme’s portfolio Superior technology – drug-eluting stents First – Medtronic and the insulin pump ‘Cool’ factor – Hemosol’s artificial blood

Executive personality

Create the right public face Choose the right spokesperson/people Is the CEO, founder, president the right person to tell the

story? What about the Chief Scientific Officer? Remember that senior executives should be present – part of

the roadshow exercise is allowing investors to eyeball management

Invest heavily in speaker preparation – some people have natural charisma, the rest have to learn to be compelling

Think of building the ‘leader brand’ (see article on executive visibility on RosettaPR.com, ‘Perspectives’ section)

Use a variety of tools

We tend to gravitate to low tech presentations and text Consider animation and video – ‘show don’t tell’ Be creative – this is about selling! Make the presentation part of a web of story elements –

links to website, additional content etc. Help your audiences dig as deep as they want to into

your story

Make the story resonate

Create opportunities for your story to ‘echo’ Not powerful in themselves but reinforces main thrust Media coverage, interviews Investment and other conferences Website(s) Supplementary materials (e.g. white papers) Social networks

Typical presentation structure Snapshot – “ABC Company is…” Details – how it works Growth plan Market opportunity and size Financial projections Risks and uncertainties Comparables Valuation Use of proceeds Key people

Management Board of directors Advisors

Summary

Paul McIvor

416.516.7095

416.906.1276 C

mcivor@RosettaPR.com

179 Fern Avenue

Toronto, ON, Canada

M6R 1K2

Contact