Team:LMU-TUM Munich/Entrepreneurship

still missing: 2x citation from companies

Due to non-disclosure agreements company names were made anonymous and interview guidelines were taken out of the appendix. Our Business model is applied in the drug development process within the pharmaceutical industry.

1 Executive Summary

3D printing is currently revolutionizing many industries as well as the biotech sector. We build on this trend in order to bring our revolutionary technology to the market. To this end, we genetically engineer cells to make them produce a "glue" that connects these cells within milliseconds in order to build stable and living tissues by 3D printing.

We aim to introduce this technology to the pharmaceutical industry. Drugs are developed over a span of 10 years, and the whole process costs up to $ 3 billion. Both these factors stem from the lack of appropriate testing systems for drug candidates. Our printed tissues should be applied subsequent to 2D cell culture screening and before animal testing in order to identify promising drug candidates at an early stage and thus solve the customer's problem of cost and time in drug development.

In our business model, we print liver tissue into a 96-well plate and provide it to our customers from the pharmaceutical industry for toxicity studies in the context of drug development. These pieces of tissue constitute customized “mini-organs” for specific drug testing. For the first time, our technology allows us to achieve a quality of printed tissue that enables our customers to use these tissues in the drug development process, which corresponds to our USP. Thus, we enable our customers to develop drugs faster, with lower opportunity costs and less animal testing. We expect annual sales of 400–500 panels for a single strategic partner within the first year. Based on our interviews, a price of € 10,000 per plate is adequate, corresponding to a turnover of € 4–5 million with a gross profit margin of about 97% without taking further investment costs for business development into account.

Within the total market for cell-based drug development, our target market is located in cells and tissues. This target market exhibits a total market volume of $ 100 million today and will grow to $ 300 million by 2019. Based on our interview, company B would be the first potential customer as soon as the results have been scientifically validated.

The competition is heterogeneous. Numerous indirect competitors act in the field of drug development by providing their customers with e.g. 2D cell cultures. Direct competitors are exclusively linked to the 3D cell culture area. Among these direct competitors, we consider Organovo to be our closest rival. Organovo also produces 3D bioprinting products for the pharmaceutical industry, but based on a significantly less powerful technology. Our printed tissues stand out by a significantly higher accuracy, stability and flexibility compared to competitors. In cooperation with the Technical University of Munich, a patent application is currently being considered.

We are seeking for an initial investment to overcome the high financial barrier that hinders market entry. Furthermore, we are interested in a network to acquire pilot customers and in an investor who is experienced in regulatory hurdles when entering the market in the pharmaceutical industry.

2 Product and Customer

The development of drugs by the pharmaceutical industry today is performed in different stages. Before drugs are eligible for testing in humans, they must be investigated by cell-based assays and animal experiments. During the first step of this pre-clinical stage, thousands of substances are screened for a desired effect and potential health risks that might disqualify them for market approval. Usually, only a few of these candidates are tested in animals and even less make it to the clinical studies, where they are tested on human patients (Appendix 2). Often, candidates still fail during the clinical studies after hundreds of millions have been invested, resulting in tremendous financial costs for the companies. The costs for the development of a single drug have been calculated by many market analyses to be between 1.4 and 2.6 billion dollars. Large cost factors are failing drug candidates and opportunity costs (Appendix 2).

Customer. The target customer for our product is a large pharmaceutical company facing the problem that today’s models for drug discovery and testing, namely 2D cell cultures and animal testing, fail to reliably confirm the impact of the drug on the human body. 2D cell models are not dependable because cells exhibit their typical functions and behavior only under conditions that mimic those in the human body, for example they need to be surrounded by specific cells in all directions as is the case in an organ. Furthermore, animals are, for most applications, not sufficiently similar to humans to obtain meaningful insights about the effect of the drug. Nevertheless, many animals are still used for scientific experiments, especially in the area of drug testing. According to a study, 95% of drugs that work in animals are ineffective in humans (Appendix Ref. 1).

The main problem of our customer is that they are forced to spend millions or even billions of dollars to assess drug candidates that often do not work in humans or even expose volunteers for clinical studies to serious health risks because there are no reliable models for the pre-clinical drug development to verify safety and effectivity. In order to reduce these enormous costs for the development of drugs, our customers need dependable systems that can distinguish drug candidates with high chances of success from candidates that will likely fail in humans. Our solution for the customers problem is providing a reliable 3D-structured cell culture test systems with a new level of quality to investigate the effects of drug candidates. With our modified printer, we are able to precisely print and connect cells to 3D structures without harming the cells.

Reducing costs and time during the drug development process by means of our product is the most important benefit for our customers. Moreover, the number of animals used for experiments is reduced because several drug candidates will be excluded early on. As decided by the EU parliament in 2010, it is planned to reduce the amount of animals used for drug development within the next years (Appendix Ref. 1). Since 1980, the German government has financed over 500 projects to find alternative ways to reduce the amount of animals used for experiments with over € 160 million (Appendix Ref. 2) Our product contribute to this goal and is an opportunity for the pharmaceutical industry to meet upcoming governmental guidelines and improve their reputation. Furthermore, the number of expensive clinical studies in humans, which put many volunteers at risk, may be reduced as well. A suitable measure for the impact of our product on the industry is, for one, the amount of money saved from identifying substances that will fail market approval. For another, we can consider how many animals are saved. Additionally, 3D cell structures live longer than 2D models, which is preferable for longer tests, and they are also more robust, which is highly favorable for the customer in terms of storage and transportation. Another advantage of our product over other approaches is that we might be able to arrange the cells into a great variety of shapes and even connect different types of cells that are usually difficult to connect under laboratory conditions.

The feedback from the interviews (protocols attached in appendix, pages 22 through 30) about the idea behind our technology was consistently positive. Moreover, the hypothesis (Appendix 1) that reliable 3D cell models are requested by the industry was confirmed. The ability to print the cells in a great variety of shapes and connecting different cell-types (co-cultures) is of high interest to our interview partners. The different partners even emphasized that a product with adequate quality and reliability is not yet on the market. As interviews with different pharmaceutical companies confirmed, the best stage to use our product in drug development will be after the initial high-throughput screening of candidates in 2D cell culture is completed. Our product will be used after 2D cell culture screenings but before the candidates are tested in animal models. Another interesting result of the interviews is that a price of up to € 10,000 for one 96-well plate with our cells is realistic. The majority of people confirmed that, in this particular industry, the price is practically irrelevant if the quality of the product is high and solves the customer’s problem. In company B, we have acquired our first potential customer. Person B, head of the in-vitro pharmacology and toxicology department at company B emphasized that we have aroused great interest and that they might test our prototype within their product development process.

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