Disclosure

1
Disclosure
Team 14
NanoMed recognizes that the intellectual property
as proposed to carry out the ideation concepts
outlined in this presentation is owned by the
Ohio State University (OSU) (background and any
unprotected potential intellectual property
conceived and or reduced to practice in the
generation of this business assessment and plan).
NanoMed is not yet a legal entity but
acknowledges that, as a legal entity, it may
require a license from OSU to carry out all or
part of the concepts outlined in this
presentation. Discussions with OSU are in
progress.
2
ZipDiscGene Delivery System
Team 14
3
(No Transcript)
4
PRIMARY MARKET Genetic Research Labs

• Life Science Tools Services
• Total market size 40.5 billion

• Gene Delivery Products
• Direct competition
• 1.2 billion

SECONDARY MARKETS

• Stem Cell Products
• Projected to experience 50 growth over 10 yrs
• 10 billion by 2016

• Pharmaceuticals
• Total market size 467 billion

• Agriculture Biotechnology
• Total market size 53.9 billion

5
ZipDiscGene Delivery System
The ZipDisc custom applicator and voltage source
One-time use ZipDisc disposable cartridges

• Product Line
• Release incremental innovations to initial
  product
• Broaden applications and increase throughput
• Follow-on products

• Competitive Advantages
• 90 success rate
• 95 cell survival rate
• Non-viral delivery method
• User-friendly

6
CUSTOMER
...make the lab bigger, better, faster and
enable more discoveries. Dr. Brian Kaspar,
Nationwide Children's Hospital
The retrovirus can be a Trojan horse that can
carry all sorts of problems Dr. Douglas
Melton, Harvard Stem Cell Institute
The limitations of current delivery technologies
... are substantial barriers to the development
and growth of the overall RNAi market Frost
Sullivan, U.S. RNAi Markets, 2006
7
VALUE PROPOSITION
ZipDisc increases success rate of gene transfer
from 15-70 to 90 ZipDisc increases cell
survival rate from 50 to 95 ZipDisc utilizes a
disposable cartridge with no viral
agents ZipDisc injects similar numbers of cells
at comparable cost to competitors
Faster Research Higher Success Rates More
Cures
8
TECHNOLOGY
PET array of nanoscale nozzles
Nozzle array
cells

• IP Position
• International patent application filed moving
  to patent in U.S. Europe
• Patent application includes core technology
  numerous applications
• Ongoing discussions with OSU technology licensing
  office

• Stage of Development
• Prototype of entire delivery system
• Entering independent testing phase
• High stage of development with little science risk

9
DEVELOPMENT PLAN
Capital Funding Needed
10
DISTRIBUTION PLAN

• Key Partners
• Distribution
• Cardinal Health of Ohio
• or other leading Medical Supply Chain Service
  company
• Production
• Zyvex Performance Materials
• or other leading edge manufacturer of
  nanomaterial devices
• Testing
• The Solove Research Institute at the James
  Cancer Hospital

• Business Model
• Razor and disposable blade model
• Sell ZipDisc custom applicator at competitive
  price
• Generate continuous revenue stream from ZipDisc
  disposable cartridges

• Sales Model
• Establish a base of pilot users through direct
  sales
• Attract distribution partner to quickly ramp up
  sales

11
A STRONG TEAM BOARD
Business Team Paul Dymerski, PhD Interim
CEO Founder of multiple technology startups Seth
Cramer Interim CFO MBA with
experience in multiple startups Bruce Caldwell
Operations MBA Candidate 20 yr. RD
Manager Mihaela Jekic, MS
Technology PhD Candidate in Biomedical
Engineering Eric Cochran, MS
Marketing PhD Candidate in Physics/Medical
Devices Aaron Sander Sales PhD
Candidate in Physics
Advisory Board James Lee, PhD NSF Director for
Ohio Polymer Composite Engineering Sharell
Mikesell, PhD Executive Director of the
Ohio Polymer Strategy Council Tom Zupancic,
PhD 25 years in gene research and transfection
industry John Bair Founder, Pinnacle Data
Systems Andy Dickson Director, Ohio Tech Angel
Fund
12
COMPETITION
MANUFACTURERS
WHOLESALERS
CUSTOMERS
Bio-Rad Fisher Thermo Invitrogen GE
Healthcare Qiagen IBI-Shelton Stratagene
Research OSU Pharmaceutical Eli-Lilly Biotech
Monsanto Cancer Hospitals Johns-Hopkins
Bio-Rad Fisher Thermo Invitrogen GE
Healthcare McKesson Amersourcebergen Beckman-Co
ulter Cardinal Health
13
COMPETITIVE ADVANTAGE

• Electroporation
• (Bio-Rad Laboratories)
• Very low cell survival (lt20)
• Very low success rate (lt40)
• ZipDisc provides significant advantage through
  high success rate (90) survival rate (95)

• Viral Vectors
• (Stratagene)?
• Long prep time (1-3 months)
• Health risk
• ZipDisc provides significant advantage through
  time efficiency (30 min), versatility, and
  elimination of health risks

• Lipofection
• (Invitrogen)
• Low success rate (lt70)
• Cell toxicity
• ZipDisc provides significant advantage through
  high success rate (90)

14
PROFORMA INCOME STATEMENT
(000s) Year 1 Year 2 Year 3 Year 4 Year 5 Year 6
Total Units 6 37 99 396 1584 6336
Sales Revenue 0 437 909 3,980 15,919 63,677
Cost of Sales 19 112 284 1,173 4,693 18,770
Gross Margin (19) 325 625 2,807 11,227 44,906
Total SGA 414 1,189 1,877 3,172 6,278 10,394
EBITDA (433) (864) (1,252) (366) 4,949 34,512
Net Income (281) (555) (800) (210) 3,254 22,716
??High Margin
Capital Required 2MM
??Growing Market
??Low Upfront Investment
15
EXIT STRATEGY

• Valuation
• March 2006, Applied Biosystems acquires Ambion
  for 273 million
• At the time, Ambion posted 52 million annual
  revenue

• Acquisition after year 5
• Established profitable enterprise
• Demonstrated effectiveness across numerous gene
  drug platforms
• Developed robust product line
• Established product as the standard for stem cell
  research
• Achieved high level of brand recognition

• Alternative Strategy
• IPO, if current predictions of market share are
  overly conservative

16
Success Rate of Gene Transfer
ZipDisc Gene Delivery System
Standard Method