Assignment 3 - Spring 2008
April 26th, 2008Special Topic
Two Sections (Don’t feel compelled to create long answers)
May do this in your groups
I. Organizational Motifs
Your other class is: Organizational Theory & Knowledge Management with Prof. Tim Hargraves. You’re being asked to integrate some of the material.
Homework (Essay) Question:
1. What motif (from the other class) would adopt for your startup organization (for your current plan)? How does this make sense? How does this set the right culture into your startup? What are the pros and cons of using this motif versus another viable motif. You may use a comparison table to summarize your argument.
II. The Joys and Pains of Biotech Entrepreneurship
On Monday May 12, 2008, we’ll be holding class in the lectureship room in Room 005 in UW2. Joe Belanoff, Founder and CEO of Corcept Therapeutics, flies in from Menlo Park, CA with the sole intent to make a guest appearance at our campus.
Corcept is backed by some of the most reputable people in technology venture capital. Nevertheless, its drug and company is met with skepticism. The drug is also infamously known as RU-486 and is being applied in advanced human trials to treat Cushing’s Syndrome and Psychotic Depression.
It’s hard to point out a forerunner to something as controversial as RU-486. Thalidomide is the best example: it was know to cause some of the most gruesome birth defects in the late 50s. Largely banned, it turned out to be one of the only effective treatments for leprosy and multiple myeloma. Celgene is continuing to test Thalidomide in other cancer indications. (Disclosure: I am working an a comparative case study of Celgene and Corcept as startups)
Required Reading
1. The Case of the Notorious Depression Drug (May 2007; San Francisco Magazine) - The seminal, easy to read, introduction to Joe Belanoff and Corcept.
Background Reading
This isn’t required, but depending upon your background in life science commercialization, you may use these pieces to help you answer the questions.
1. What the hell happened? (April 2007) - This was a post-mortem to the failed trials that caused the Corcept stock to crater.
2. Orphan Drug Act - Corcept is developing for an “orphan disease” called Cushing’s Disease. Why might Corcept develop for such a micro market?
3. Update for Class (April 2008) - This piece was originally written as an update in March 2008. It was revised and expanded for the class.
Homework Questions
1. Before and after the disastrous Phase III trial results were known, the management of tiny Corcept were confronted with a strategy choice. Based on available data, the management was fairly certain that the drug could successfully treat an orphan disease called “Cushing’s Syndrome”.
This would likely yield about $20M in annual revenues. With the extreme pricing allowed for orphans, this figure could be significantly higher. This would be like trying to bunt or hit a single.
On the other hand, the team originally came to swing the home-run: to pursue the “more humane and effective” treatment of psychotic depression. It could result in a large stream of revenues ($250M to $500M). This is like swinging for a home run.
As late as last Summer, the Corcept team appeared to decline the orphan opportunity. It has now changed course and is pursuing the opportunity.
What are the pros and cons of pursuing an orphan strategy? Do you think Joe’s team made the right call? Or should they have begun work earlier on Cushing’s Disease?
2. Tiny Corcept only has about 20 employees. Contract research was “pharmed out” to the United Kingdom and to India. The company also sports an unorthodox CEO paired with an experienced board. What do you think are the advantages and disadvantages of running a tiny, virtual biotech company like Corcept?
(By the way, Joe has one of the more strenuous travel schedules. Be sure to give him a rousing welcome)
3. What questions do you have for Dr. Belanoff?
Fishbowl Schedule
April 22nd, 2008
Wednesday, April 23, 2008
Rogue Yoga (Shannon, Amy, Betty, Jay, Rich)
Massage Franchise (Jodi)
Barcade (Gus, Dan)
Raptor (Rob, Alpesh, Chetan, Mark)
Monday, April 28, 2008
Grocery Saver (Ed, Kyle, Leila, Melanie, Tara)
Divertim
NASAD (Adam, Alicia, Christopher, Rachel, Ryan)
Basepin (Baemin, Bertin, David, Jeff)
Perfect Soccer (Evgenia, Amber, Gagan, Mark, Thiruvallur)
Non-digital Backups (Val)
EcoCycle (Cisco, Julie, Maarten, Shannon, Cisco)
Assignment 2 - Spring 2008
April 7th, 2008Due Monday, April 28, 2008
Business Plan Critique
Your team will grab someone else’s plan on Feb 5 and critique it. You should write comments directly into their plan. The individual team members may wish to use a different color ink, or you can simply use one color.
The Introduction to Writing a Business Plan includes checklists. You may also include additional items from your own lists.
You will hand in the critique to the instructors and we will grade the critique. Did you catch the major concerns with the plan? Do you have any suggestions? Do you have any referrals to help the authors?
Your team should share the critique with the authors.
Assignment 1 - Spring 2008
April 7th, 2008Due Monday April 21 at class
The Early Business Plan
You will create three clean copies of your business plan. You should not use any binding that makes it difficult to write onto your manuscript. Coil or comb binding is acceptable as well as stapling (don’t staple your final plan).
You will give two copies to the instructors and one copy to another project team. You should also grab one business plan from another project team.
What do we want in a business plan? You may wish to view a sample business plan and also to read through a draft booklet given to you on the first day of class.
What Will Happen?
Each business plan will be reviewed by at least two instructors or advisers. We will use a different pen color to identify each reviewer’s comments. Don’t be surprised (or put off) if the plan is painted reviewer comments.
Your plan will also be reviewed by another project team, but that critique will first be submitted to the instructors (see assignment 2).
Why an Early Business Plan?
It’s simply the most effective way to get you running. We know it won’t be perfect. This exercise will clarify what you must accomplish. It might also force you to abandon your original idea and totally morph. Don’t be afraid. I award style points for total morphs. Consult your instructors.
It also removes the mystery about how we approach business plans.
Yes, this is painful, but over the years, we found that the alternative is far worse.
Course Materials - Spring 2008
April 7th, 2008Introduction (April 7, 2008)
Budgeting
Financial Modeling
Marketing Primer (April 14)
Negotiation (April 16)
Sales Primer (April 21)
Trademarks & Copyright (April 30)
Sample Peer Review Form (Word Doc)
Three Examples of Graphics to Explain a Story
Echospace Executive Summary (The graphics were prepared in Office in 2000)
Echospace Financials (Your mileage may vary on this one, but it’s an example)
IMCentric Early Draft Business Plan (2001 Class; This was actually the early business plan)
Sample Business Plan & Sample Spreadsheet
Zen Chai Business Plan (pdf format) (2006 Class - some of the marketing / interview / pricing data has been yanked)
Zen Chai Spreadsheets (xls format) (Among the better of the simplified formats)
Plastic Payments Spreadsheets (xls format) (A simple spreadsheet, but it does provide for a subscription model)