1. science
2. medicine
3. surgery

www.glytrix.com
Confidential Business Plan
January 2010
Prepared By:
John Paderi, Kate Stuart, and Joshua Cox
Copyright © 2009 Glytrix Inc
CONTACTS
For further information please contact
John Paderi
CSO, Glytrix Inc.
207 S. Martin Jischke Drive
DLRC Suite 103
West Lafayette, IN 47907
Tel: 513-289-1727
Fax: 765-496-1459
Email: [email protected]
DOCUMENT CONTROL
Document no. GlytrixBP2010.01 released 11 Jan 2010
All rights reserved. The information contained in this document is confidential and may also
be proprietary and trade secret. Without prior written approval from Gltyrix Inc no part of
this document may be reproduced or transmitted in any form or by any means, including
but not limited to electronic, mechanical, photocopying, or recording or stored in any
retrieval system of whatever nature.
Use of any copyright notice does not imply
unrestricted public access to any part of this document. Pelladerm is a trademark of Glytrix
Inc.
Copyright © 2010 Glytrix Inc
Copyright © 2010 Glytrix Inc
Page i
Management Team
John Paderi, Ph.D. - President, Founder, CSO
Inventor of Glytrix technology, 7 years tissue
engineering/biomaterial R&D
Kate Stuart, Ph.D. - Founder, COO
7 years tissue engineering/biomaterial R&D
Scar-Free Healing
Scarring of the skin is currently an inevitable
consequence of deep dermal wounds.
Glytrix is
addressing this large and unmet market through its lead
product Pelladerm, which promotes scar-free healing of
these dermal wounds.
After seeing Pelladerm results illustrated in part below,
one plastic surgeon reported, “I am ashamed that we
have not yet developed this type of product; [Pelladerm]
should be used in every surgery.”
Joshua P. Cox - Business Advisor
Marketing and Finance Specialist
Alyssa Panitch, Ph.D. - Founder, Scientific Advisor
Founder and CSO of two companies, Associate Head
of Weldon School of Biomedical Engineering at Purdue
University
Primary Contact
John Paderi: [email protected] ║ (513) 289-1727
•
Preventing Dermal Scarring: Clinical and Market Need
In the U.S. annually, there are over 42 million patients who
could benefit from Pelladerm, a therapeutic aimed at
preventing scar formation. Scars are of high patient
concern, often higher than successful outcome of a surgical
procedure.
According to Kalorama Information, scar
prevention has been overlooked, though the potential is
‘huge’ as there is no standard of treatment for scars.
Pelladerm is a novel therapeutic, positioned to be the first
FDA approved product for scar prevention.
No Treatment
•
Pelladerm is applied at the time of injury as a
single treatment.
Wounds treated with Pelladerm have shown a 40%
reduction in visible scar and a 65% increase in
tissue strength in animal studies.
Due to reimbursement, Glytrix will focus first on
entering the elective cosmetic surgical market, a market
of 1.8M procedures in the US annually. Glytrix will
target additional markets, including trauma injuries,
after two years of sales in the cosmetic market when
insurance codes are obtained.
Pelladerm Treatment
Above: skin tissue images from animal studies show scar free healing potential of Pelladerm in incisional wounds.
•
•
•
•
•
Glytrix’s Technology
Glytrix has developed a platform technology, termed
collagen-binding peptidoglycans, for needs in tissue
healing and regeneration
Technology derives from natural tissue components
critical to tissue structure and healing
Lead therapeutic, Pelladerm, restores healthy tissue
environment leading to scar free healing
Low cost synthesis with design control
Technology tailorable for many applications in
Glytrix’s pipeline
Competition and Glytrix Advantage
Few products currently exist for treatment of existing
scars, while the market for scar prevention is unique in the
field.
Pelladerm has a significant advantage over the
potential competition as it will quickly reach the market
following a device approval pathway. Additionally,
standard of care for wounds is not altered with application
of Pelladerm. Competitors include:
•
•
•
Mederma: Scar treatment OTC, multiple use, efficacy
disputed, no FDA approval
Renovo: TGF-β targeting therapeutics, FDA drug
regulation, many Phase II clinical trials, 1 Phase III for
small indication only
Capstone Therapeutics: Peptide therapeutic, FDA
drug regulation, Phase II clinical trials
IP and Regulatory Strategies
The FDA has designated Pelladerm a device due to its
mode of action, and Pelladerm will follow the de novo
510(k) class II device pathway to approval.
Glytrix’s intellectual property is currently protected
through one over-arching PCT application filed in
March 2009, that protects the platform technology composition of matter and methods of use. Additional applications will be filed as new compositions of matter and
methods of use are developed.
Future Funding Requirements
AMIPurdue is providing over $600k in funds through
May 2010 for completion of the following milestones:
• GMP synthesis
• FDA preclinical safety data
• First in man safety study
Glytrix is seeking $4.7M over three years to fund
clinical trials, sales and marketing, product scale-up, and
market launch of Pelladerm.
COGS: $8
Sale Price:
2010
Total Procedures
1,800
Market Share
0.00%
Units Sold
0
Net Revenue
$0
Break Even: Q4 2012
(in thousands)
$200
Market Growth: 3%
2011
2012
2013
2014
1,854
1,910
1,967
2,026
0.00%
4.00%
18.00% 25.00%
0
76
354
506
$0
$9,166 $42,485 $60,777
Necessary Funding: $4.7M
Table of Contents
Executive Summary........................................................................................ii
I. Business Summary ....................................................................................1
A. Mission ..................................................................................................... 1
B. Milestones Completed ................................................................................ 1
C. Timeline and Milestones to Market ............................................................... 1
D. Organization and Location .......................................................................... 1
E. Financial Brief ........................................................................................... 1
II. Product Summary.....................................................................................2
A. Dermal Scarring: An Unmet Need ............................................................... 2
B. Glytrix's Advantage Over Competition .......................................................... 2
C. Product Overview: Pelladerm......................................................................3
D. Preclinical Data: Efficacy of Pelladerm in Preventing Dermal Scarring................3
E. Pelladerm Technology: Collagen-Binding Synthetic Peptidoglycans ..................6
F. Glytrix's Platform Technology.......................................................................6
III. The Market..............................................................................................8
A. The Customer ........................................................................................... 8
B. The Market Opportunity.............................................................................. 8
1. Cosmetic and Reconstructive Surgery Market ........................................... 8
2. General Surgery Market: C-Sections and Trauma ..................................... 9
C. Industry Analysis and Forecast ................................................................. 10
1. Scar Revision Surgery ......................................................................... 10
2. Over the Counter ................................................................................ 10
3. Emerging Therapies ............................................................................ 10
D. Future Markets: Burns and Hypertrophic Scars ........................................... 11
E. Future Markets: Balloon Antioplasty Application ......................................... 12
IV. Glytrix's Strategy ...................................................................................13
A. Milestones Completed .............................................................................. 13
B. Milestones to Complete ............................................................................ 13
i. Pelladerm 510(k) Approval ................................................................... 15
a. Purity, Stability, Biocompatibility, and Sterility Testing....................... 15
b. Clinical Safety Study ..................................................................... 15
c. 510(k) Application ........................................................................ 15
C. Entry to Market ...................................................................................... 15
D. Production ............................................................................................. 16
E. Marketing .............................................................................................. 16
F. Sales Strategy ........................................................................................ 16
G. Distribution Strategy............................................................................... 16
H. Pricing Strategy ..................................................................................... 17
I. Exit Strategy .......................................................................................... 17
J. Risks of Failure ....................................................................................... 17
K. Intellectual Property Considerations .......................................................... 17
V. Management Team ..................................................................................18
A. Personnel Plan ....................................................................................... 20
VI. Financial Analysis ..................................................................................21
A. Necessary Funding ..............................................................................22
Copyright © 2010 Glytrix Inc
Page iv
List of Figures and Tables
Figure 1: Cosmetic Appearance of Wounds ...................................................4
Figure 2: Histological Evaluation of Wounds .................................................5
Figure 3: Breaking Strength of Wounds.........................................................5
Figure 4: Competitive Landscape................................................................11
Table 1: Comparison of Decorin to Glytrix's Peptidoglycan Technology .........6
Table 2: Elective Surgical Procedures Performed Annually in the U.S. ...........9
Table 3: Key Milestones Over the Next 5 Years ...........................................14
Table 4: Personnel to be Hired ....................................................................20
Table 5: Market Opportunity .......................................................................22
Table 6: Expenses .......................................................................................22
Table 7: Cash Flow ......................................................................................22
Copyright © 2010 Glytrix Inc
Page v
I. Business Summary
Mission
Glytrix is dedicated to improving quality of life by solving pressing healthcare needs through
responsible scientific discovery and development leading to innovative and effective
therapeutics.
•
•
Positioned to be the first FDA approved product to prevent scarring of the skin
Platform technology amenable to wide product range in the pipeline
o Burn injury: prevent hypertrophic scarring
o Balloon angioplasty: targeting early stage thrombosis and restenosis
Milestones Completed
• Preclinical efficacy of Pelladerm in preventing scar formation
• Pelladerm synthesis and characterization procedures completed
• Pelladerm purity and degradation tests identified and procedures drafted
• Contract manufacturing organization for cGMP synthesis of Pelladerm identified
• Site for clinical safety study for Pelladerm identified
• Research proof-of-concept for balloon angioplasty application obtained
Timeline and Milestones to Market
Key Milestones
1
2010
2
3
4
1
2011
2
3
4
1
2012
2
3
4
CMO GMP Synthesis
Purity/Stability/Biocompatibility
IRB Approval
Human Clinical Study - Safety
FDA - De Novo 510(k) Submission
SALES - cosmetic market
Organization and Location
Glytrix is a startup company, and is currently affiliated with the Purdue Research Foundation.
The company will move to Research Park in Q3 2010. The Purdue Research Foundation is a
nonprofit organization created to assist Purdue through programs and facilities such as Purdue
Research Park.
Financial Brief
Glytrix is seeking $4.7M in funding over the next 3 years to bring its first product, Pelladerm, to
market. An additional $2M is requested to fund all preclinical testing for Glytrix’s second
indication, to prevent early stage thrombosis and restenosis after balloon angioplasty. Glytrix
expects to break even in Q4 2012, with net revenues over $60M by 2014.
Copyright © 2010 Glytrix Inc
Page 1
II. Product Summary
Dermal Scarring: An Unmet Need
Glytrix has developed a platform technology for tissue healing and regeneration. The lead
product of Glytrix’s platform is Pelladerm, which is a therapeutic for preventing scarring of the
skin. Scarring is currently an inevitable consequence of deep dermal wounds, such as those
resulting from surgery, trauma, or burns. Scars can compromise physical appearance leading to
debilitating aesthetic and psychological effects. There is a high consumer demand for
preventing and reducing scars; according to the Mattson Jack group, there are over 42 million
procedures annually in the US alone that could benefit from a product that reduces or prevents
dermal scarring. Kalorama Information, a medical market research group, has detailed the
wound care market and noted that scar prevention has been overlooked, though the potential is
‘huge’ as there is no standard of treatment for scars. A detailed breakdown of the market is
presented in Section III. The Market (page 8).
Scarring is of high importance to the patient, often reported as greater concern than the
successful outcome of surgical procedures, yet to date there are no FDA approved products
available that have produced consistent results for preventing, reducing, or eliminating scars. In
fact, after seeing preclinical data on Glytrix’s lead product, Pelladerm, one plastic surgeon
reported, “I am ashamed that we have not yet developed this type of therapeutic; [Pelladerm]
should be used in every surgery performed.”
Glytrix’s Advantage Over Competition
There is currently no standard of treatment for dermal scarring. There are several homeopathic
and over-the-counter remedies available directly to the consumer, which advertise reduction in
scar appearance after use over several weeks or months. None of these products prevent the
formation of the scar, but are rather marketed to reduce the appearance of scars already formed;
however, efficacy of these products is disputed in the scientific and clinical communities, and
without FDA approval, these products are not well supported by physicians. Still, sales of overthe-counter remedies are growing, illustrating the demand for such products despite the lack of
support of efficacy. In fact, Michael Dolyk, Buyer for OTC and Health and Beauty care for Medic
Drug Inc. reported, “Scar reduction products are one of the few things really moving right
now. They are the most innovative things out there.”
As scarring of the skin remains a large and unmet clinical need, it is also being targeted by
competitors aiming for FDA approved products supporting scar reduction and prevention.
These companies are focused on affecting cellular pathways to reduce deposition of scar tissue.
Pelladerm is unique in that it instead focuses on restoration of the healthy tissue environment
for proper healing. It is well known that the tissue environment affects cellular behavior and the
resulting healing response. Glytrix’s technology works to restore a healthy tissue environment,
which promotes efficient and effective healing, significantly preventing and reducing scar tissue
formation.
Glytrix has a significant advantage over competing companies in the development phase of its
product. Pelladerm will follow the de novo 510(k) Class II device pathway, while competing
Copyright © 2010 Glytrix Inc
Page 2
technologies aimed at affecting cell function require FDA approval through the drug pathway.
This strategy gives Pelladerm high probability of success to market. After approval, anticipated
by Q2 2012, Glytrix will first market its therapeutic in the cosmetic market, allowing Glytrix to
respond to the huge, unmet need of scar reduction.
Product Overview: Pelladerm
Glytrix is responding to the unmet need of preventing scar formation through the development
of Pelladerm. Pelladerm is the lead product in Glytrix’s platform technology, designed to
improve adult tissue healing and regeneration. The technology is a novel class of molecules
termed peptidoglycans, which are derived from natural tissue components and engineered for
target applications. Glytrix’s peptidoglycan therapeutics are a unique approach to healing in
that they aim to restore a healthy tissue environment to promote proper healing, setting Glytrix
apart from the competition primarily focused on directly targeting cells and cell function.
Pelladerm is designed to fit within current surgical practices and with the surgeon’s ease of use
in mind. Pelladerm is supplied as a sterile solution that can be easily applied as single dose
treatment at the time of injury, followed by standard of care for wounds. This method of use
does not require any changes to current wound care practices, while offering superior cosmetic
outcome. Cost efficient production of Pelladerm makes its use feasible as either an optional or
built in procedural cost. It is anticipated that Pelladerm will substantially improve clinical
outcomes and will change the current expectations of scar formation in general and cosmetic
surgeries as well as in treatment of trauma and burn injuries. The ease of use without changing
standard of care for wounds, coupled with strong efficacy in preventing dermal scarring,
position Pelladerm well for the first product of its kind and warrant further development for
FDA approval.
Preclinical Data: Efficacy of Pelladerm in Preventing Dermal Scarring
Preclinical data in a small animal model demonstrate the efficacy of Pelladerm in mitigating
dermal scarring as measured by cosmetic, histological, and mechanical strength assessment. In
this model, a surgical incision was made, and Pelladerm was applied prior to suturing the
wound closed. Pelladerm is delivered in a hyaluronic acid (HA) solution, which acts as a viscous
carrier of the peptidoglycan. Untreated and HA vehicle treated wounds were also compared as
proper controls for the study. Cosmetic appearance results, illustrated in Figure 1 below, show
that a single dose of Pelladerm results in a 40% decrease in visible scar. The cosmetic
appearance was quantitatively assessed as observers blinded to treatment conditions measured
the visible scar length. The improved cosmetic appearance was supported by histological
evaluation of the wound tissue, which is presented in Figure 2 below. Histological evaluation is
often considered the most compelling data as it unequivocally demonstrates tissue differences
between healthy scar free healing compared to scar tissue.
As such, a board certified
pathologist examined and graded tissue samples, concluding a significant improvement in tissue
maturity and restoration of healthy tissue in wounds treated with Pelladerm.
A third metric of improved healing and reduction in scarring was also used to further support
the efficacy of Pelladerm in scar prevention. FDA guidelines for developing products for
treating burns and ulcers suggest the breaking strength of incisional wounds as an indicator of
Copyright © 2010 Glytrix Inc
Page 3
improved healing, as scar tissue will have weaker breaking strength due to the poorly organized
collagen fibers in the scar tissue. Following these guidelines, and shown in Figure 3 below,
Glytrix found that wounds treated with Pelladerm had more than a 60% increase in breaking
strength compared to control. These results further support the efficacy of Pelladerm for scar
prevention.
Visible Scar Length (in)
1
*
0.5
0
Untreated
Vehicle control
(HA)
Pelladerm
Figure 1. Cosmetic Appearance of Wounds. Single dose application of Pelladerm
results in a 40% decrease in visible scar. * Denotes statistical significance.
Copyright © 2010 Glytrix Inc
Page 4
1 mm
Untreated
Vehicle Control
Intact Skin
Figure 2. Histological Evaluation of Wounds. Wound area is marked by black arrows.
Pelladerm treatment results in more mature and healthy tissue, noted by mature collagen fibers
and decreased wound area as compared to immature tissue of untreated and vehicle control
treated wounds. Intact uninjured skin is included for comparison.
15
Ultimate tensile strength (N)
*
10
5
0
Untreated
Vehicle control
(HA)
Pelladerm
Figure 3. Breaking Strength of Wounds. Following FDA guidelines for assessment
of improved dermal healing, wounds treated with Pelladerm result in approximately 60%
increase in breaking strength. * Denotes statistical significance.
Copyright © 2010 Glytrix Inc
Page 5
Pelladerm Technology: Collagen-Binding Synthetic Peptidoglycans
Pelladerm was inspired by the native molecule decorin, and is considered a biomimetic
therapeutic. Pelladerm is designed to improve wound healing by restoring a healthy tissue
environment, which in turn leads to healthy scar free healing. Decorin is in a class of molecules
known as proteoglycans and is the most prevalent proteoglycan in the skin. Decorin has
important implications in the wound healing process, especially by regulating collagen
organization. Collagen is the major tissue component of skin, and in healthy tissue, is organized
into uniform and regular fibers. Decorin plays a critical role in dermal healing; for example,
increased decorin levels correlate with accelerated dermal healing and improved cosmetic
outcome, while decorin deficiencies result in impaired dermal healing. Decorin has been
suggested as a therapeutic for reducing scar formation; however, decorin is costly to purify since
it exists in animal tissues in small quantities, making its wide spread use in wound healing
impractical. Table 1 below compares decorin to Glytrix’s peptidoglycan technology, illustrating
similarities for tissue healing function and how therapeutic use of decorin is not practical.
Glytrix has developed a feasible alternative therapeutic, stemming from its platform technology,
in the form of a collagen-binding synthetic peptidoglycan that mimics decorin. The
peptidoglycan which makes up Pelladerm is an engineered molecule, inspired by decorin,
composed of naturally derived tissue components. Specifically, it is composed of the
polysaccharide chain, dermatan sulfate, with covalently attached collagen-binding peptides.
Detailed information of composition and function are available upon request. Pelladerm
mimics decorin by regulating collagen organization and restoring a healthy tissue environment.
Unlike decorin, Pelladerm can be synthesized at low cost in large quantities, and with unique
design control.
Table 1. Comparison of Decorin to Glytrix’s Peptidoglycan Technology
Collagen
Enhances
Restores
Synthesized Control of
Cost per
Binding
Tissue
Healthy Tissue
in Large
Design
Gram
Strength
Environment
Quantities
Decorin
X
X
X
X
X
X
$440,000
X
X
$1,500
Glytrix’s Product Platform
Glytrix’s technology is amenable to multiple indications. While Glytrix is focused on moving
Pelladerm forward as the lead product, a follow on product is currently in preclinical testing for
efficacy in preventing hypertrophic scar formation. This scar type, commonly resulting from
burn injuries, can be both physically and psychologically debilitating and is of significant clinical
concern as the market is yet unmet.
Glytrix is also investigating a product designed to improve the outcome of balloon angioplasty
procedures. According to the American Heart Association, over 1.3 million balloon angioplasty
procedures are performed annually in the U.S. The advent and use of stents and drug eluting
stents have led to improved outcome and safety of these procedures, and is reflected by the 30%
increase of balloon angioplasty procedures performed over the last 10 years. Still, significant
clinical concerns exist with angioplasty procedures with and without stenting. Early stage
Copyright © 2010 Glytrix Inc
Page 6
thrombosis following balloon angioplasty is responsible for approximately 9,300 in hospital
deaths each year (American Heart Association), and narrowing of the blood vessel wall over
time, termed restenosis, perseverates as a significant clinical concern and focus of many
researchers.
Glytrix has strong preliminary data supporting a unique product that aims to prevent the
immune response that occurs at the vessel wall due to deployment of the balloon during
angioplasty procedures. This product has the potential to prevent early stage thrombosis, and is
expected to reduce or prevent restenosis by preventing inflammation at the vessel wall. Such a
therapeutic could change the current standard and improve the expectation of balloon
angioplasty procedures. Glytrix will continue preclinical studies for this indication throughout
2010 and anticipate clinical trials by Q4 2011. This product is positioned for FDA approval
through the Class III device pathway. While Glytrix may pursue this application internally
following preclinical studies, potential partnerships are also being considered.
More
information and preliminary data on this application are available upon request.
Copyright © 2010 Glytrix Inc
Page 7
III. The Market
The Customer
Pelladerm differs from other products in that it is applied at the time of surgery before wound
closure, in order to prevent formation of scar tissue. This unique application of Pelladerm
necessitates its use as a prescription product, and Glytrix will market Pelladerm to physicians.
By presenting at scientific conferences and holding individual meetings with prominent
physicians, Glytrix will directly inform leaders in the field of the significant advantages
Pelladerm will provide in the mitigation of scar formation. As Pelladerm is designed to fit
within current surgical practices, it is expected that Pelladerm will be well received.
The Market Opportunity
The demand for products that reduce or prevent dermal scarring is large, as demonstrated by
the market for over the counter scar management products. These products are not FDA
approved and efficacy is disputed in the scientific and medical communities. Still sales of these
products are growing, illustrating the strong demand. Michael Dolyk, Buyer for OTC and Health
and Beauty Care Products for Medic Drug Inc., reports, “Scar reduction products are one of the
few things really moving right now. They are the most innovative things out there.”
Pelladerm has the potential to be used in every surgical procedure that results in dermal
scarring, which is over 42 million procedures in the US annually. Glytrix has identified specific
segments of this market for initial sales of Pelladerm: the cosmetic and reconstructive surgery
market, and general surgeries including C-sections and trauma wounds.
Cosmetic and Reconstructive Surgery Market
According to the American Society for Aesthetic Plastic Surgery and the American Society of
Plastic Surgeons, there were over 1.8 million cosmetic surgical procedures performed in the US
in 2007 that could have benefited from a scar mitigation product, representing a market of
approximately $7.7 billion. In addition to initial cosmetic surgery procedures, the American
Association of Plastic Surgeons estimates that over 150,000 scar revision reconstruction
surgeries were performed in the US in 2007, indicating the demand for scar reduction. Glytrix
seeks to first focus Pelladerm in the primary market of plastic surgery due to the following
market factors:
•
•
•
Reimbursement is not relevant since the majority of plastic surgeries are private pay.
The plastic surgery market is less price sensitive than other markets (higher gross
margins)
Plastic surgeons may potentially be the earliest adaptors of a product that mitigates
scarring and provides attractive margins.
The cosmetic surgery market is broken into multiple procedures, summarized in Table 2. This
table includes only those cosmetic surgical procedures in which Pelladerm will likely be used.
This market represents over 1.8M annual procedures that may be improved by use of Pelladerm.
Additionally, there are over 4.8M reconstructive procedures performed by plastic surgeons each
Copyright © 2010 Glytrix Inc
Page 8
year, including dog bites, tumor removal, burn repair, and hand surgery. These procedures
represent an additional market where Pelladerm has an early high probability of success.
Table 2. Elective Surgical Procedures Performed Annually in the U.S.
Procedure
Number of
Procedures
Average
Expenditure
Total
Expenditure
Abdominoplasty
185,335
$5,350
$991,542,250
Breast Augmentation
399,440
$3,889
$1,553,422,160
Breast Lift
126,178
$4,341
$547,738,698
Breast Reduction (Women)
153,087
$5,417
$829,272,279
Buttock Augmentation
5,325
$4,250
$22,631,250
Buttock Lift
3,787
$4,885
$18,499,495
Cheek Implants
2,406
$2,840
$6,833,040
Chin Augmentation
18,250
$2,254
$41,135,500
138,153
$6,792
$938,335,176
Forehead Lift
61,119
$3,337
$203,954,103
Gynecomastia, treatment of
20,280
$3,455
$70,067,400
Facelift
Lip Augmentation (Surgical)
10,673
$1,611
$17,194,203
456,828
$2,942
$1,343,987,976
Lower Body Lift
12,711
$8,043
$102,234,573
Otoplasty
28,413
$3,085
$87,654,105
Lipoplasty
Rhinoplasty
151,796
$4,357
$661,375,172
Thigh Lift
18,431
$4,783
$88,155,473
Upper Arm Lift
21,870
$3,864
$84,505,680
328
$3,609
$1,183,752
70,014
$1,077
$75,405,078
440
$3,591
$1,580,040
Calf Augmentation
Dermabrasion
Pectoral Implants
Total
Average Procedure Cost
1,884,864
$7,686,707,403
$3,989
Source: American Society of Aesthetic Plastic Surgeons 2007 and American Society of Plastic Surgeons 2007
General Surgery Market: C-sections and Trauma
Initially, Glytrix expects modest market share immediately following FDA approval of Pelladerm
as it will reach the market through the 510(k) approval pathway, and will thus not have labeling
claims for use in scar reduction. In order to increase market share, Glytrix will perform a nonsignificant risk clinical trial immediately following FDA approval. This trial will last one year
and provide efficacy data that will support labeling claims for scar reduction and accelerated
wound healing. Once labeling claims are added, Glytrix anticipates a significant increase in
market share as Pelladerm will be able to obtain insurance reimbursement codes. This market
strategy is detailed in Section VI. Financial Analysis (page 21).
Copyright © 2010 Glytrix Inc
Page 9
Some of the surgical procedures in which Glytrix sees high potential for Pelladerm include
Caesarean Section, appendectomies, cholecystectomies (Gallbladder removal), orthopedic
surgical procedures, and trauma. Sales for this market will begin in Q4 of year 2013. Glytrix
expects to market Pelladerm to physicians, and the product cost will be built into the surgical
procedure.
Industry Analysis and Forecast
The US wound treatment market was $5.9B in 2008. Some portions of the market, such as antiinfectives, wound management, and sutures and staples, are mature and slowing in growth
rates. Other portions of the market, such as moist and biological dressings that could
potentially prevent dermal scarring and accelerate healing are in early stages of development
and implementation. Pelladerm fits within this growing market.
As Pelladerm is positioned to be the first product to market for preventing scarring, Glytrix
anticipates a strong hold on over competitors currently in development stages. Pelladerm is
designed to easily fit within current surgical practices and with surgeon’s ease of use in mind.
Pelladerm will be supplied as a sterile solution that can simply be applied to the wound prior to
closure. Pelladerm has the potential to be used in every surgical wound and to change the
expectations of surgical scar formation. Current and developing competitors are detailed below
and summarized in Figure 4.
Scar Revision Surgery
Scar revision is an option to reduce the appearance of large scars. This procedure is surgical and
costly, and will result in some scar formation. Pelladerm could be used in conjunction with scar
revision surgery.
Over the Counter
While there is currently no gold standard product to reduce scarring, there is some limited
evidence that scarring can be diminished somewhat with topical medication. Glytrix will have
an enormous advantage as these products are not FDA approved and are not well supported by
the scientific and medical communities.
Over the counter products for scar reduction include Merz’s Mederma, Avocet’s Avogel, and a
host of companies which market some form of silicone wound dressing. There is limited and
conflicting data on the efficacy of these products, and they are not well supported by the clinical
community. These products are intended for use after wound closure and after the wound
healing process and scar formation has begun. Pelladerm, in contrast, is applied before wound
closure and restores a healthy tissue environment to prevent healing without formation of scar
tissue.
Emerging Therapies
Competing companies looking to fill the unmet need of scar mitigation include Renovo and
Capstone Therapeutics. Both companies are developing products classified as drugs, and must
navigate the FDA’s drug pathway to market. Pelladerm will follow the 510(k) Class II device
pathway, following an easier and faster pathway to market. No competing product is expected
to be to market at the time Pelladerm sales begin, Q2 2012. Additionally, the Renovo and
Copyright © 2010 Glytrix Inc
Page 10
Capstone products requiree multiple applications; this alters the standard of care, as patients will
have to revisit the physician’s office for a sec
second
ond or third application of treatment. Pelladerm
requires only a single dose, applied at time of surgery, eliminating any concerns of patient
compliance or physician standard of care.
Figure 4.. Competitive landscape, and ad
advantages
vantages of Pelladerm.
Future
e Markets: Burns and Hypertrophic Scars
While Glytrix is focused on bringing its lead product Pelladerm to the market, there is yet a large
unmet need for therapeutics to prevent hypertrophic scarring. Hypertrophic scars often results
from burn injuries and are typically characterized as raised, red or pink, stiff scars which can be
physically, aesthetically, and psychologically debilitating. Glytrix is currently pursuing this
need, and is in preclinical trials for support of efficacy of a follow
follow-on product
duct to Pelladerm as a
therapeutic to prevent hypertrophic scarring. Approval of the follow
follow-on
on product for this
application will require Pre-Market
Market Approval (PMA) from FDA as burn injuries bear greater risk
to the patient.
Integra® Dermal Regeneration T
Template
emplate is an FDA approved tissue engineered product for
burn and reconstructive surgery, and represents the standard of care in these fields. It is a
bilayer material consisting of a silicone sheet and a porous matrix of crosslinked bovine hide
collagen and a glycosaminoglycan. This material functions as a skin graft and promotes healing
after excision of the injured area. While the Integra product has shown excellent results, it
requires proper application susceptible to user variability and error. Al
Also,
so, it requires an
epidermal autograft, necessitating suitable donor site availability. Glytrix will directly test its
product against the Integra product in pre
pre-clinical
clinical studies on hypertrophic wounds. Glytrix
believes the Pelladerm follow product, by acting directly on the tissue’s environment, will prove
more effective than the Integra product in preventing scar formation. Additionally, it is
expected that Glytrix’s product will have advantages in ease of use without user variability.
Integra’s product
uct is only marketed for burns and reconstructive surgeries, and will not be a
competitor in cosmetic or surgical scars.
Copyright © 2010 Glytrix Inc
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Future Markets: Balloon Angioplasty Application
According to the American Heart Association, there were 1.3M balloon angioplasty procedures
performed in the US in 2006, representing a market of $63B annually. This is a 10% increase
over the previous decade, a result in part of use of stenting, which has made balloon angioplasty
a safer and more effective procedure. Still, 9,300 in hospital deaths each year occur due to
complications, commonly early stage thrombosis. In addition, narrowing of the vessel over
time, termed restenosis perseverates as a significant complication to balloon angioplasty
procedures. Glytrix has strong data supporting a product that would prevent these
complications, and is currently continuing preclinical animal trials to validate results. Glytrix
anticipates this product could be used in every balloon angioplasty procedure, representing an
annual U.S. market of over 1.3M patients, and could result in large market growth due to
improved clinical outcome.
Copyright © 2010 Glytrix Inc
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IV. Glytrix’s Strategy
Milestones Completed
• Glytrix has been incorporated, July 2009
• Intellectual property of the Glytrix platform technology has been protected through 2
patent applications
• AMIPurdue has obtained a license for the technology from Purdue
• Glytrix has secured funding to support milestones through May 2010
• Preclinical efficacy data of Pelladerm therapeutic has been obtained
• Purity and functional tests of Pelladerm have been identified for characterization and
stability testing
• Regulatory counsel for Glytrix has been obtained
• Contract Manufacturing Organization for cGMP synthesis of Pelladerm has been
identified
• Site for clinical safety study for Pelladerm has been identified
• Preclinical studies for burn indication have begun
• Preclinical studies for vascular indication have begun
Milestones to Complete
Pelladerm has strong commercialization potential, and Glytrix plans for initial FDA approval
through the de novo 510(k) Class II device pathway. This pathway allows for approval of low
risk devices without predicate devices, requiring a non-significant risk clinical safety study for
the product prior to approval. Following this pathway, Glytrix will reach the market prior to
emerging competitors who are developing therapeutics requiring FDA approval through the
drug pathway. Immediately following FDA approval of Pelladerm, a follow-up clinical study will
be conducted to support efficacy of Pelladerm for scar mitigation, which will allow additional
product claims to be added to Pelladerm labeling. The key milestones Glytrix aims to complete
are summarized in Table 3.
Copyright © 2010 Glytrix Inc
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Table 3. Key Milestones over the Next 5 Years
2010
Key Milestones
CMO GMP Synthesis
Purity/Stability/Biocompatibility
IRB Approval
Human Clinical Study - Safety
FDA - De Novo 510(k) Submission
FDA - Acceptance
SALES - cosmetic market
Human Clinical Study - Efficacy
FDA - Revise Claims
SALES - Expand to General Surgery
1
2
3
2011
4
1
2
3
2012
4
1
2
3
2013
4
1
2
3
2014
4
1
2
3
4
Pelladerm 510(k) approval
Purity, Stability, Biocompatibility, and Sterility Testing
Glytrix is currently pursuing FDA approval of Pelladerm through the de novo 510(k) Class II
device pathway. In order to complete this application, the purity, stability, sterility, and
biocompatibility of Pelladerm will be validated under current good laboratory practices (cGLP)
with material synthesized under current good manufacturing practices (cGMP). cGMP
synthesis is currently being performed in the laboratory of Dr. Alyssa Panitch, but will be
translated to a contract manufacturing organization (CMO) prior to human use. Standard
Operating Procedures (SOPs) have been written and are ready to translate to the CMO
immediately.
Glytrix is finalizing development of assays to determine the purity and stability of Pelladerm,
and will transfer these protocols to a company with experience in this field in Q2 2010. Final
packaging considerations will also be made at this time. John Hertig, Director of AMIPurdue,
has extensive experience in sterile packaging and is guiding these decisions.
Biocompatibility and sterility data are necessary for FDA 510(k) application. Glytrix will use an
independent contractor (NAMSA) to perform these studies and use FDA guidelines from ISO
10993 for studies. Cytotoxicity (ISO 10993-5), sensitization (ISO 10993-10), and irritation or
intracutaneous reactivity (ISO 10993-10) will be performed based on ISO guidance for Surface
Devices contacting a breached comprised surface for prolonged exposure.
Glytrix expects positive results from all biocompatibility and stability studies based on data from
preclinical animal studies. Pelladerm has been used in numerous preclinical studies with no
adverse effects, and has been used in in vitro studies with no signs of cytotoxicity.
Clinical Safety Study
Upon receipt of biocompatibility and stability data, Glytrix will be prepared to file for IRB
approval for a human safety study. This study will be performed at the University of Texas
Southwestern and will consist of 30 patients and last 6 months. The primary endpoint of the
study will be safety, and efficacy in reducing scar appearance will be examined secondarily.
510(k) Application
Upon completion of the clinical safety study, Glytrix will be prepared to submit a 510(k) Class II
Device application to the FDA in Q4, 2011.
Entry to Market
Glytrix will initially target the cosmetic surgery market since this market is paid out-of-pocket
by the patient, as opposed to the general surgery market which is insurance-reimbursed. Glytrix
is targeting this market first for two reasons. First, clinical trial data showing accelerated
healing is necessary for insurance reimbursement. Second, insurance reimbursement is
necessary to stimulate sales from the general surgery market as market demand is more
sensitive to price.
Upon FDA approval of Pelladerm through the 510(k) pathway as a Class II device (Q2 2010),
Glytrix will pursue a non-significant risk clinical trial in order to demonstrate efficacy in humans
and expand the labeling claims of Pelladerm for scar prevention indications. Healthy subjects
Copyright © 2010 Glytrix Inc
Page 15
will be recruited for the study, which will take place at the University of Texas Southwestern
beginning Q3 2010.
The primary objective of the clinical study is to evaluate the efficacy of Pelladerm in mitigating
scar formation of incisional wounds. Additionally, enhancement of wound healing through
faster healing response will be evaluated. Both patient and physician will assess the scar at 3, 6,
and 12 months. Upon completion of the clinical trial (Q2 2013), Glytrix expects data supporting
claims for use of Pelladerm in preventing scar formation and increasing the speed of healing.
These claims will allow for insurance reimbursement codes, and will significantly increase the
market share for Pelladerm in cosmetic, surgical, and trauma type wounds.
Production
Glytrix will use a CMO to produce Pelladerm, beginning in Q2 2010. cGMP manufacturing
within Glytrix’s facility will be focused towards development of second generation product and
products for other applications.
Marketing
Glytrix will market directly to physicians since physician approval will be necessary to facilitate
use of the product. Glytrix has already begun to present its data at scientific conferences, and
will continue to present at medical conferences in association with the Wound Healing Society
and submit to peer-reviewed publications, i.e. “Plastic & Reconstructive Surgery Journal.”
These conferences are attended by thought leaders in the field and will provide early marketing
to physicians.
After approval, Glytrix will additionally market directly to consumers, making Pelladerm more
widely known to those who may not visit plastic surgeons. Television advertising and brochure
advertising will be used to make customers aware of the product.
Sales Strategy
Pelladerm will be sold directly to physicians, who will then administer the product to the patient
at the time of surgery. Physicians who use it regularly will stock the product as a standard
necessity. Less-frequent users may order it from Glytrix on an as-needed basis.
Glytrix will contract with an independent sales force early on to reduce startup costs, and will
focus initially in markets where cosmetic procedures are high. As sales revenue increases,
freeing up cash-flow, Glytrix will obtain an internal sales force to retain greater control over the
physician-manufacturer relationship.
Distribution Strategy
Initially, Glytrix will contract out the distribution, providing the distributor with a margin of
35%. This will enable Glytrix to quickly tap into the market. Once the product is wellestablished, Glytrix will provide distribution to physicians direct from the manufacturer.
Regarding distribution channels, Glytrix will provide Pelladerm to private practice physicians
within the cosmetic surgery market.
Copyright © 2010 Glytrix Inc
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Pricing Strategy
Due to the less elastic demand within the cosmetic market, pricing for Pelladerm will be less
impacted by economic conditions than the general surgery market. Expected pricing for
Pelladerm is $200/application, based on physician feedback as to what patients would be
willing to pay.
Exit Strategy
Glytrix will pursue a sale of the company at the time of exit. Although revenues at the time will
likely justify an IPO – likely over $50 million/annum – a sale precludes the difficulty of timing
the IPO market, the high transaction fees, and restrictions in liquidity.
Risks of Failure
A significant milestone for Glytrix success if FDA approval of Pelladerm. Approval of Pelladerm
through the de novo FDA 510(k) Class II Device pathway is highly probable. Therapeutics for
dermal injuries are generally considered low risk to the patient, especially if the treatment is
localized to the healing injury site. Glytrix will complete a clinical safety study prior to FDA
approval.
A follow on product to Pelladerm is also being investigated for use in burn wounds.
Additionally, a therapeutic to prevent early stage thrombosis and restenosis following balloon
angioplasty is being investigated with highly positive results. Glytrix’s platform technology
provides high probability of success in multiple markets.
Intellectual Property Considerations
Application for Intellectual Property (IP) rights to the core technology being developed by
Glytrix was first filed as a U.S. Provisional Patent in March 2008. This provisional patent
application claims IP rights over the composition of matter for synthetic collagen-binding
peptidoglycans, including Pelladerm. Conversion of this provisional patent application in
accordance to the Patent Cooperation Treaty (PCT) occurred in March of 2009. In conjunction
with submission of patent application, patentability opinion and Freedom to Operate (FTO)
opinion were obtained from AMIPurdue’s patent council. This patent counsel is comprised of
several legal institutions, including Barnes and Thornburg LLC, Seed IP LLC, as well as in-house
patent council. Both patentability and FTO analysis resulted in favorable opinions for obtaining
IP protection and freedom to practice the core technology (synthetic collagen-binding
peptidoglycans) for wound healing treatment.
Furthermore, as a result of ongoing technology development, another provisional filing was
made to expand the technology’s field of use. This provisional was strategically filled prior to
the publication of the PCT application in April of 2009. As a result of the IP strategy, Glytrix’s
core technology will be protected by a portfolio of IP covering the composition of matter and
methods of use within a broad range of applications. This strategy is in-line with the company’s
objective to develop this platform technology for a multitude of biomedical applications.
Copyright © 2010 Glytrix Inc
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V. Management Team
Glytrix has assembled a strong, multi-disciplinary commercialization team, comprised of the
Company’s scientific founders and partners with AMIPurdue. Members of the team have prior
experience with small business ventures in the medical industry. The scientific team is
comprised of the inventors of the technology and founders of Glytrix.
John Paderi, PhD, Founder/Chief Scientific Officer
• PhD (Biomedical Engineering), Arizona State University
• Entrepreneurial Fellowship award from Burton D. Morgan Center for Entrepreneurship
2009-2010
• Primary inventor of peptidoglycan technology for Glytrix
• 7 years experience in biomedical research and development
Kate
•
•
•
Stuart, PhD, Founder/Chief Operating Officer
PhD (Biomedical Engineering), Purdue University
Co-inventor of peptidoglycan technology for Glytrix
7 years experience in biomedical research and development
Alyssa Panitch, PhD, Founder
• PhD (Polymer Science and Engineering), University of MA
• Associate Professor of Biomedical Engineering, Purdue University, 2006-present
• Co-Founder and Chief Administrative Officer/CSO of AzERx, Inc. 2002-2005
• Co-Founder and Chief Scientific Officer of Moerae Matrix, Inc., 2006-present
• Assistant then Associate Professor, Harrington Department of Bioengineering at Arizona
State University, 1999-2006
• Member, NIH Biomaterials and Biointerfaces (BMBI) study section, 2008-present
• Postdoctoral fellowship at the Swiss Federal Institute of Technology (ETH) and
University of Zurich, 1997-1999
• Editorial Advisory Board of Biomacromolecules, 2003-present
Lynetta Freeman, DVM
• DVM, Oklahoma State University
• MBA, Xavier University
• Senior Scientist/Principal Scientist/Research Fellow/Director, Ethicon, 1989-2006
• Associate Professor of Small Animal Surgery and Biomedical Engineering, Purdue
University, 2006-present
• Adjunct Associate Professor, IU School of Medicine, 2008-present
• 17 patents and 8 pending patents
Joshua Cox, MBA
• MBA, Purdue University
• Financial & Marketing Consultant
• Graduate Assistant at the Burton D. Morgan Center for Entrepreneurship, 2008-2010
Management is currently being provided by AMIPurdue. AMIPurdue is a non-profit institute
located within Discovery Park at Purdue University. AMIPurdue bridges the gap between
Copyright © 2010 Glytrix Inc
Page 18
biomedical and life science research at Purdue University and the rapid commercialization of
these innovative academic efforts for the benefit of mankind. The directors of AMIPurdue have
over 60 years of experience in the medical device industry and a track record of successful
product development, providing leadership to start-up companies, fund raising, initial public
offerings, and company divestitures. AMIPurdue has served as Glytrix’s commercialization
team, providing intellectual property analysis, regulatory pathway planning, up-front marketing,
financial modeling and seed capital for technology development. Additionally, Glytrix has been
able to utilize the regulatory expertise present at AMI USC (Alfred Mann Institute at University
of Southern California). AMIPurdue will continue to serve in an advisory capacity and continue
to provide business leadership and additional funding. AMIPurdue is comprised of the
following team:
John
•
•
•
Hertig
Executive Director
Executive management, operations, regulatory, product development
35+ years experience in medical device industry
Steve
•
•
•
Mogensen
Managing Director
Senior management, sales, marketing, operations
25 years experience in medical device industry
Rizaldi Sistiabudi, PhD
• PhD Biomedical Engineering, Purdue University
• Business Development Manager
• Product development, program management, regulatory
• 6 years experience in biomedical research and development
Kam Leung, Ph.D., RAC
• Regulatory Affairs Manager
Arman Nadershahi, J.D., M.S.
• Legal and Regulatory Affairs Counsel
Alexander Gorup, MD
• Board Certified Facial Plastic Surgeon
• Glytrix Clinical Advisor
Rajiv
•
•
•
•
Sood, M.D., F.A.C.S.
Board Certified Plastic Surgeon
Hand and Microsurgery CAQ
Medical Director, Richard M. Fairbanks Burn Center
Glytrix Clinical Advisor
Copyright © 2010 Glytrix Inc
Page 19
Personnel Plan
Glytrix immediately seeks an experienced CEO. Additionally, Quality Control, Regulatory, and
Clinical Personnel are needed by the end of year 1. A marketing a sales force will be necessary
starting year 2, for sales to begin in year 3. The sales/marketing force will be independent
contractors during years 1-5, with Glytrix employing personnel to oversee these firms. A
summary of the personnel to be hired over the next 5 years, with associated costs, is shown in
Table 4.
Table 4: Personnel to be Hired
Head Count
Assumptions
2010
2011
2012
2013
2014
Executive Board
Salary
CEO
150,000
1
1
1
1
1
CSO
120,000
1
1
1
1
1
COO
120,000
1
1
1
1
1
QC/R&D Mgr.
90,000
1
1
2
2
2
Regulatory
120,000
1
1
1
0
0
Clinical
120,000
1
1
1
1
1
Gen Manager
120,000
0
1
1
2
3
QC / R&D
Sales/Market/Mgmt.
Product Mgr.
100,000
0
1
1
2
3
Sales/Marketing Spec.
90,000
0
1
1
2
3
Admin
50,000
0
0
1
2
2
Copyright © 2010 Glytrix Inc
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VI. Financial Analysis
Glytrix has funding through AMIPurdue through May 2010. This funding will allow Glytrix to
complete all necessary pre-clinical studies for Pelladerm, including biocompatibility, stability,
and purity. Additionally, AMIPurdue has agreed to fund a clinical safety study consisting of 30
patients, to be conducted at University of Texas Southwestern. Additional funding is needed to
fund hiring of a CEO, the management team, and a regulatory team to bring Pelladerm through
the FDA approval process.
A detailed financial analysis through year 5, and estimates at year 10, is included in Tables 5-7.
This model includes Glytrix reaching only the cosmetic market, and profit margins will increase
as sales in the general surgery market begin.
Table 5 summarizes the potential opportunity in the cosmetic surgery market, Glytrix’s market
share, and gross revenues. It is based on the following assumptions:
•
•
•
•
•
•
Market growth rate: 3%. From 1996 to 2007, the cosmetic surgery market increased
over 100%. However, in the last 5 years, the market growth has slowed drastically. The
American Society of Plastic Surgeons believes this is due in large part to the state of the
economy, and that growth will continue. The number of general surgical procedures has
an approximately 3% growth rate.
Estimated product cost: $8, including packaging
Sale price: $200. This figure is based on physician statements, the current cost of
cosmetic surgical procedures, and the money consumers are willing to spend on overthe-counter and homeopathic remedies to decrease scar (over $50 per product).
Market share: a sales prediction model was utilized to determine market shares over the
next five years. Market share was capped at 25% due to competition entering the field.
Reimbursement: Most plastic surgeries are private pay, making reimbursement
irrelevant. For the general surgery market, Glytrix has assumed reimbursement through
health insurance, as there are multiple insurance codes for wound dressings.
Sales force: Glytrix plans to use a distributor for the first 3 years of sales of Pelladerm,
and has assumed a 35% distributor margin based on gross sales. After 3 years of sales,
Glytrix will build a small sales force to directly sell Pelladerm to physicians.
Additionally, a 5% royalty rate to Purdue University is assumed.
Table 6 summarizes Glytrix’s operating expenses. Glytrix has applied a 5% marketing budget
and a 6% research and development budget based on gross sales, up to a maximum of
$1M/year.
Finally, a cash flow statement is presented in Table 7. Glytrix expects to break-even with a
positive cash flow in Q4 2012. To reach this point, Glytrix will require total funding of
approximately $4.7M in years 1-3.
Copyright © 2010 Glytrix Inc
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Table 5: Market Opportunity
US Market Potential
Market Share
Units Sold
Gross Revenues (1)
Distributor Margin (35%) (2)
Royalty (3)
Net Revenues
COGS (cost of goods) (4)
Gross Profit
2010
1,800,000
0.00%
2011
1,854,000
0.00%
-
-
2012
1,909,620
4.00%
76,385
$ 15,276,960
$5,346,936
$763,848
$9,166,176
$611,078
$8,555,098
2013
1,966,909
18.00%
354,044
$ 70,808,710
$24,783,048
$3,540,435
$42,485,226
$2,832,348
$39,652,877
2014
2,025,916
25.00%
506,479
$101,295,793
$35,453,528
$5,064,790
$60,777,476
$4,051,832
$56,725,644
...
...
...
...
...
...
...
...
...
...
2019
2,348,592
25.00%
587147.9327
$117,429,587
$ 5,871,479
$111,558,107
$ 4,697,183
$106,860,924
(1) Sale price = $200
(2) Beginning 2015, Glytrix will switch to an in-house sales team and direct distribution, eliminating the distributor
margin
(3) Royalty = 5%
(4) COGs = $8
Table 6: Expenses
Expenses
Clinical Trials
QC/Regulatory/Clinical Salary
Sales/Mkt/Mgmt Salaries
R&D Expense
Executive Salaries
Marketing Expense
Facilities
Legal
Insurance
Phone/Uitlity/Misc
Total Expenses
2010
2011
$200,000
$330,000
$310,000
2012
$500,000
$420,000
$360,000
$320,000
$623,000
$390,000
$100,000
$24,000
$100,000
$38,000
$10,000
$1,302,000
2010
$0
$623,000
$623,000
2011
$0
$1,302,000
$1,302,000
$623,000
$1,302,000
$51,917
($571,083)
($571,083)
$108,500
($1,193,500)
($1,764,583)
$80,000
$23,000
2013
2014
$300,000
$1,030,000
$1,000,000
$390,000
$1,000,000
$48,000
$200,000
$110,000
$10,000
$4,088,000
...
...
...
...
...
...
...
...
...
...
...
...
$390,000
$500,000
$48,000
$120,000
$110,000
$10,000
$2,458,000
$300,000
$720,000
$1,000,000
$390,000
$1,000,000
$48,000
$200,000
$110,000
$10,000
$3,778,000
2012
$8,555,098
$2,458,000
$6,097,098
$2,438,839
$3,658,259
$152,770
$1,909,620
$204,833
$1,800,702
$36,119
2013
$39,652,877
$3,778,000
$35,874,877
$14,349,951
$21,524,926
$708,087
$8,851,089
$314,833
$12,280,584
$12,316,703
2019
$300,000
$3,460,000
$1,000,000
$390,000
$1,000,000
$48,000
$200,000
$110,000
$10,000
$6,518,000
2014
$56,725,644
$4,088,000
$52,637,644
$21,055,058
$31,582,586
$1,012,958
$12,661,974
$340,667
$18,248,321
$30,565,024
...
...
...
...
...
...
...
...
...
...
...
2019
$106,860,924
$6,518,000
$100,342,924
$40,137,170
$60,205,754
$1,174,296
$14,678,698
$543,167
$44,895,927
$241,390,819
Table 7: Cash Flow
Gross Profit
Total Expenses
Operating Earnings
Taxes
Net Earnings
Inventory Increase
Acct Rec Increase
A/P increase (accounts payable)
Cash Flow
Cum Cash Flow
Necessary Funding
AMIPurdue will have committed over $600k in funding for Glytrix by May 2010. They have
additionally agreed to fund a 30 patient safety study. This funding will allow Glytrix to reach the
milestones necessary to submit an FDA package for Pelladerm through the de novo 510(k)
device pathway. At this time, Glytrix is in need of funding to support a regulatory firm to
Copyright © 2010 Glytrix Inc
Page 22
prepare this FDA document and to guide Glytrix through the entire FDA regulatory route.
Additionally, Glytrix is seeking a CEO, as well as funding for its executive board. For these
efforts, Glytrix is initially seeking $1M. In conjunction with AMIPurdue funding, this will allow
Pelladerm to reach FDA approval by 2012, and will also fund additional efforts for preclinical
testing of Glytrix’s anti-thrombotic application. Additional support of $3.7M will be needed
beginning Q1 2011 to fund marketing, production, and initial sales of Pelladerm, as well as all
operating costs over the next 3 years, including facilities, equipment, supplies, marketing,
salaries, legal fees, and clinical trials An additionally $2M is also requested to support all
preclinical studies necessary for the anti-thrombotic application. A total of $6.7M is requested.
Glytrix expects to break even in Q4 2012, and will have returns of over $60M in revenue by
2014.
Copyright © 2010 Glytrix Inc
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