Writing a Winning Business Plan ◾ 303
active ingredients are placed into a polymeric-controlled release layer. They are delivered
di
rectly to the skin in a preprogrammed manner. In other words, the actives will be
tr
apped in a polyurethane matrix designed to release them out at a specific dosage over a
pr
edetermined time period. PolyMedica has developed the fundamentals for drug delivery
sy
stems for the human health care market using the combined disciplines of polymer
chem
istry, pharmaceutics, and web handling engineering.
e Company’s strategy for commercializing its unique technological ability in controlled
an
d sustained release products is composed of two elements:
1
. E xpanding PolyMedica’s proprietary polymer technology and maintaining
ownership of the technology through patent and corporate secrecy protection.
is means that in early stage product development, the Company may fund
research and development expenses in its own laboratories.
2
. E stablishing long-term strategic relationships with leading companies for the
development, marketing and sale of their own products which could benefit
frompatent protection if incorporated in a new delivery system.
4.3 Markets
According to Business Communications Company, a Stamford, Connecticut-based market
re
search consulting firm, the estimated annual U.S. sales of new drug delivery systems from
ma
nufacturer to distributor grew from $720 million in 1983 to $1.8 billion in 1988. Drug
de
livery system sales are expected to soar to $3.5 billion by 1993. At the present time, Alza,
Ke
y Pharmaceuticals, and several other publicly-traded companies have the major share of
th
e market for new drug delivery systems. Jim McCamant of the California-based Medical
Te
chnology Stock Letter says, “e potential market is still very large—large enough to make any
comp
any with a unique and efficient drug delivery production system prosperous.”
e Company’s product development efforts for Chronothane
TM
have emphasized two
ar
eas of human health care: transdermal delivery and topical (local) drug delivery.
Confidential PolyMedica Industries, Inc.
304 ◾ The Guide to Entrepreneurship: How to Create Wealth for Your Company
4.4 e PolyMedica Competitive Advantage
PolyMedica’s polymer technology and its applications in pharmaceuticals are at the
fore
front of controlled-release research. e Company has developed a unique polymer
sy
stem, trade named Chronothane
TM
, which forms the technology core for initial products.
Several distinguishing features set PolyMedica apart from its competition:
1
. e Company is the only group known to produce hydrophobic and hydrophilic
photopolymerizable polyurethane elastomers. ese polymers, when used as
the matrix layer, are capable of delivering hydrophobic and hydrophilic drugs at
controllable rates.
2
. C hronothane
TM
photopolymer films are produced at room temperature, in the
absence of water and solvents. Heat, water and solvents are known to degrade man
y
drugs. e Chronothane
TM
matrixes are produced in the absence of heat or water
,
thus ensuring full pharmacological activity and stability of the drug imbedded in
the matrix layer.
4.5 Present Competitive Products
Below is a summary of the most active companies in the field of sustained/controlled
de
livery systems, with existing and/or envisioned new products.
CO
MPANY PRODUCT(S)
MARKETING
PARTNER INTRODUCTION
Ad
vanced Polymer
Sy
stems
Re
dwood City, CA
Microsponges Sterling Drug,
Scott Paper
1990s
Al
za
Pa
lo Alto, CA
Scopolamine,
nitroglycerine,
estradiol
Ciba-Geigy Early 1980s
Be
nd Research
Be
nd, OR
Oral and implant
polymer tech.
Upjohn Undetermined
Confidential PolyMedica Industries, Inc.
Writing a Winning Business Plan ◾ 305
CO
MPANY PRODUCT(S)
MARKETING
PARTNER INTRODUCTION
Da
ltex Medical
W.
Orange, NJ
Drug coatings
medical devices
C.R. Bard,
Block Drug
Early 1990s
El
an
Mo
nksland,
Ir
eland
NicotineNon
eL
ate 1980s
Eu
rand America
Va
lhalla, OH
Polymer-based
capsules
A.H. RobbinsLate 1980s
Here
on Labs
S.
Plainsfield,
NJ
Nitroglycerine Bolar Pharm. Mid 1980s
Ke
y Pharm.
Mi
ami, FLA
Nitroglycerine None Early 1980s
No
va Pharm.
Ba
ltimore, MD
ImplantNon
eE
arly 1990s
4.6 Benefits to the Pharmaceutical Industry
One of the most pressing problems facing the pharmaceutical industry is that in the
pa
st few years only a very limited number of new drug products have been approved for
ma
rketing by the Food and Drug Administration (“FDA”). Pharmaceutical companies in the
U.
S. spent $1 billion for R&D in 1975 alone, but produced only seven new drug entities. In
co
ntrast, in the mid 1950s, about forty new drug entities were introduced yearly by U.S.
ph
armaceutical companies with total annual R&D expenditures of less than $100 million.
As
patents on some 150 pharmaceuticals expire in the coming few years, suppliers to the
$2
0billion dollar a year prescription drug market are facing competition from makers of
gene
ric compounds. To prevent a potential revenue loss, industry leaders are evaluating the
fe
asibility of incorporating new drug delivery techniques into many of their largest selling
pr
oducts. If they are successful, they will replace obsolete drug patents with new patents that
protect
the methods by which their existing drugs are administered.
Confidential PolyMedica Industries, Inc.
306 ◾ The Guide to Entrepreneurship: How to Create Wealth for Your Company
PolyMedica has developed a family of novel photopolymerizable elastomers which can
be u
sed advantageously in a variety of controlled-release devices.
is family of proprietary photopolymers can incorporate prescription and over-the-counter
dr
ugs without resorting to heat, solvents, or water. This is a crucial consideration with many
dr
ugs which are easily degraded by heat, solvents, or water. In addition, these polyurethane
el
astomers are manufactured in a continuous web process, insuring high reproducibility and
low
manufacturing costs. These key economic features reflect a state-of-the-art advancement
over cu
rrent methods.
4.7 Development and Approval Process
Some of the Company’s delivery system products will need to be approved by the FDA
pr
ior to being sold in the U.S. ere may exist comparable regulatory agencies in certain other
co
untries when selling outside the U.S.
e Company’s initial controlled delivery products are likely to be classified as a
“d
evice” rather than a “drug”. Generally, the FDA approval process to determine the safety
an
d efficacy of a “drug” takes many years and requires an IND (Investigational New Drug).
is
is a very expensive undertaking and PolyMedica’s corporate partners would fund an
IN
D. If the Company develops a “device”, the FDA approval process is truncated, and there
ma
y be circumstances in which PolyMedica would fund the cost.
4.8 Joint Venture Partner Strategy
e technology of PolyMedica has applicability to the development of controlled
rele
ase products in many therapeutic categories. The present strategy is to concurrently
pu
rsue a number of joint development contracts and product design agreements with
ma
jor pharmaceuticalcompanies. In recent years, such collaborative agreements have been
co
mmonly used in the pharmaceutical industry to implement programs where smaller
comp
anies want to allow major drug companies access to their technology.
e Company expects specific terms to vary from partner to partner, but Poly Medica
will
seek agreements which will provide it with: (1) immediate revenues under development
co
ntracts, (2) manufacturing rights for products or polyurethane material components
de
veloped by the Company, and (3) royalties based on product sales. In turn, the joint
ven
ture partners will be granted exclusive rights in a particular geography for the sale and
di
stribution of jointly-developed products.
Confidential PolyMedica Industries, Inc.
Writing a Winning Business Plan ◾ 307
POLYURETHANES
A polymer is a large molecule constructed from many smaller structural units called
monome
rs, which are covalently bonded together. Polyurethanes are among the most
im
portant classes of polymers because of their unique physical and chemical properties. In
ad
dition to a significant number of urethane groups, polyurethanes may contain aliphatic and
ar
omatic hydrocarbons, ester, ether, amide, and urea groups.
Polyurethane was originally developed by Professor Otto Bayer in 1937, who was trying
to
develop fibers to compete with nylon. In the following year, the DuPont Company
de
veloped a polyester type polyurethane based on diisocynate chemistry and it becam
e
th
e basis of most products made from polyurethanes for the next quarter of a century. In
19
62, Johannes Mirkovitch, Ph.D. first used the polyester polyurethane for making artificial
orga
ns. Unfortunately, this polyester material was attacked by the body’s enzyme systems and
hy
drolyzed.
e use of polymers in medical applications and devices continued to increase over the
ye
ars as the search went on for a more stable polyurethane for implantable devices. In 1967
,
Jo
hn W. Boretos, Ph.D. and William Pierce, M.D., Ph.D. introduced Biomer
R
, a segmente
d
po
lyether-type polyurethane, for biomedical applications such as artificial hearts. Biomer
R
beca
me the yardstick by which all other polyurethanes were measured because it had the
best
fle
xure endurance characteristic of any polyurethane. In 1971, Emery Nyilas, Ph.D. developed
a
ma
terial called Avcothane
R
which advanced polyurethanes through the addition of silicone and
ma
de the polyurethane even more blood compatible.
In 1977, the Upjohn Company introduced a thermoplastic polyurethane, trade name
d
Pe
llethane
R
, as an alternative biomedical material. Because Pellethane
R
is a thermoplastic,
it
could be processed more cheaply and made more dimensionally precise. Concern over
th
e implantation of polyurethanes began to increase in the late 1970s because of harmful
subs
tances which might be released during biodegradation. en, in 1978, ermedics, Inc.
in
troduced an aliphatic polyurethane called Tecoflex
R
. Because of its chemical structure,
Te
coflex
R
could not form carcinogenic amines if it degraded in the body. However, Tecoflex
R
i
s not suitable for long-term implants.
Confidential PolyMedica Industries, Inc.
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