Week 10 – Making Plastic More Human-Relevant

Hope all is going well and for our US readers, hope you had a great Thanksgiving holiday.  Hopefully you are recovering from all of the food and libation overload that typically happens each year.  I was debating holding off writing a blog this week as many folks may be in a comatose state, but I have been really thinking about the business (not that I don’t do that every day), and decided that I wanted to share what we have been working on over the past several weeks.  One of the key areas of the company, our life science benchtop tools products that we call our In Vitro Research Tools or IVRT products, is really taking front and center of the business.  The past few weeks, I have been working with our business team on revision of our pitch deck to investors focused on raising our Series A round.  This raise has been no easy task as most institutional investors (i.e. VCs, strategics, private equity) are not looking at “smaller” investments so we have our work cut out for us.  They are looking for bigger raises that might provide a home run if successful, with the goal of hitting the lottery.  Raising these funds will be important as we look to grow the company.  We have worked hard over the past 22 years to derisk the technology so that these opportunities would be available.  I strongly believe that we are at an inflection point as I’ll describe further on.  Many companies get to this point, but getting through it is not a given even if your technology has promise.  If you are an investor or have connection with an investor(s) and are interested in learning more about our Series A raise, please feel free to reach out to me.  You never know what a simple connection can bring.   

Revising the pitch deck has allowed me to really get a handle on where we’ve come in a short period of time.  Over the past several months, we have been able to execute agreements with US and international distributors for our IVRT products.  We recently executed a supply agreement with the global leader in the cell culture space that will begin selling our products next year under their brand.  We will be putting out a press release early next year as we get closer to product launch.  We have continued to organically grow our customer base, with customers sharing data with us showing that various types of tissues like skin can be grown using our Bio-Spun™ scaffold.  There is nothing better than having outside researchers verifying what we see in our internal research.  We have also executed co-marketing agreements with several companies, with more lining up including some with major players in the space that sell medium (food for the cells) and cells themselves. 

You may be asking yourself why is this type of technology important and why do we feel that this technology could be a big achievement for BioSurfaces.  As background, over 93% of drugs that are developed by companies at the benchtop followed by preclinical (animal) testing fail when tested in people, never becoming a usable therapy.  Each drug candidate failure can cost billions (this is not a typo) of dollars so you can understand why companies charge so much when 1 drug works.  This failure is the result of benchtop testing that does not truly replicate how these drugs will interact with tissue/cells in the human body. Current technologies on which various tissues are grown on are flat, plastic films with holes (imagine the surface of a Mylar balloon).  The scaffolds onto which cells grow into normally in the body look more like a 3D spider web. 

Over the past several decades, there has been limited innovation in this space.  Growing cells and tissues on surfaces that they are not usually accustomed to can result in behavior that is not typical.  Imagine trying to develop a drug that has a specific effect (such as preventing cancer cells from growing) but the cells being evaluated are not behaving the same way as in the body.  It is likely one reason why so many drugs fail when getting into people.  Animal testing is not always predictive since their systems are different than ours, and you can see why there is a push from governments and regulatory agencies to develop new models that better predict success while also limiting or eliminating animal testing.  This is called New Approach Methods or NAMs, which is projected to be over a $11 billion addressable market.  This is where our Bio-Spun™ scaffold can play a role.  While our scaffold is synthetic and not biologic, the cells like the 3D structure and look to populate it.  We have shown in preclinical implant studies that cells also respond the same way, one of the only scaffold options we know of that have shown this crossover.  Companies that would be looking to make a medical device could evaluate specific cells on these same scaffolds and then BioSurfaces could make the selected device. 

Change is always a big challenge.  Getting researchers to try something new (really getting anyone to try something new) can be daunting.  Add to this that existing technology is less expensive than our technology since it has been around for decades and we are just getting started.  My argument about pricing is that you can pay little for the same old results that are not predictive.  There is also a “hidden” cost to failed experiments in terms of lost time and supply costs.  Using existing technologies can also have issues such as tissue contraction, limitations of forming more complex tissues on 2D surfaces and, if purchasing existing pre-made tissues, inability to change or alter the tissue (referred to as a black box).  Some investigators look for free samples but without any skin in the game, these can sit on shelves and never get tested.  How do we balance all of these areas?  We are finding our way through.  Our marketing and sales team will be reducing prices in our on-line shop next week to get new investigators engaged.  Please visit our website next week and see what we are up to.

Looking forward to our last blog of the year at the end of December.  A lot to review and take in.  

Matt