TARGETING EMERGING DELIVERY TECHNOLOGIES ACROSS THE VALUE CHAIN Delivery systems can differentiate products in a crowded market place. Learn how partnering with innovative start-ups can help keep your company ahead of the competition. What are the innovative delivery technologies relevant to the cos- metics industry? Best practices for partnering in the delivery space with specific examples from the cosmetics industry How delivery technology developers stack up against each other on the Lux Innovation Grid and how the grid can be used in partner selection process Chananit Sintuu, Ph.D, Research Associate, Lux Research Inc

1. Growing
Targeted
Delivery
Partnerships
and
Alliances
in
the
Cosmetics
and
Personal
Care
Industries
Chananit
Sintuu,
Ph.D.
-­‐
Lux
Research,
Inc.
InnoCos
Europe
June
8-­‐9,
2011

2. Lux
Research
! We
help
clients
capitalize
on
science-­‐driven
innovation
! We
focus
on
emerging
technologies
in
the
chemicals
and
materials
sector
and
the
energy
and
environment
sector
(cleantech)
! We
have
practices
in
Water,
Printed
Electronics,
Green
Buildings,
Advanced
Materials,
Solar
Components,
Solar
Systems,
Smart
Grid
&
Suntech
solar
Grid
Storage,
Electric
Vehicles,
Alternative
Fuels,
Bio-­‐based
Materials
&
factory,
China
Chemicals,
China
Innovation,
and
Targeted
Delivery.
! We
have
clients
on
six
continents
–
blue-­‐chip
corporations,
government
agencies
and
laboratories,
universities,
investors,
and
SMBs
! We
source
our
intelligence
from
direct
interaction
with
CEOs,
CTOs,
CSOs,
and
R&D
execs
at
cutting-­‐edge
technology
firms
in
our
sectors
of
focus
Qatar
Science
and
! We
draw
on
our
network
to:
Technology
Park
• Continuously
monitor
emerging
technologies
• Identify
discontinuities
in
technology
commercialization
• Assist
with
company
and
technology
evaluation
• We
have
global
reach,
with
50
employees
in
New
York,
Boston,
Singapore,
and
Amsterdam
! Research
team
combines
deep
technical
expertise
with
business
analysis;
60%
hold
advanced
science
or
engineering
degrees
Svalbard
Global
Seed
Vault,
Norway
2

3. Agenda
! Targeted
Delivery:
What
it
is
and
why
partnerships
are
especially
important
in
the
field
! Targeted
delivery
technology
partnerships:
what
both
sides
say
! Best
targeted
delivery
partnership
practices
! How
the
targeted
delivery
technologies
stack
up
to
each
other
• Companies
developing
delivery
technologies
for
personal
care
and
cosmetics
! Summary
3

4. Agenda
! Targeted
Delivery:
What
it
is
and
why
partnerships
are
especially
important
in
the
field
! Targeted
delivery
technology
partnerships:
what
both
sides
say
! Best
targeted
delivery
partnership
practices
! How
the
targeted
delivery
technologies
stack
up
to
each
other
• Companies
developing
delivery
technologies
for
personal
care
and
cosmetics
! Summary
4

5. Delivery
technologies
provide
a
span
of
control
and
targeting
Untargeted
delivery
Targeted
delivery
Actives affect
unintended
Side effects
tissues
mitigated or
Lower cost for smaller
amount of active eliminated
High cost for large
amount of active molecule and targeting
molecule system
 Too little of the
 The right
Actives degraded or needed dose Less active therapeutic
excreted before reaches the released into the dose reaches the
reaching target target environment target
Active ingredient Targeting system
Source: Lux Research

6. Partnerships
in
the
Targeted
Delivery
Technology
Value
Chain
link
specialty
chemicals,
startups,
and
application
developers
Materials
Pla+orms
Applica1ons
Polymers,
dendrimers,
chitosan,
Bio/chemical
targe@ng,
advanced
Healthcare
and
life
sciences,
silica,
monoclonal
an@bodies,
materials,
encapsula@on,
device
pharmaceu@cal
and
biotech,
excipients,
solvents,
proteins,
delivery,
supercri@cal
fluid
food,
beverage,
agriculture,
oil
pep@des,
small
molecules,
ac@ve
technology,
nanopar@culate
and
gas,
consumer
goods,
pharmaceu@cal
ingredients,
reformula@on,
injec@on
depots,
nutraceu@cals,
cosmeceu@cals,
vaccine
adjuvants,
etc. etc. personal
care,
etc.
6

7. Targeted
delivery
technologies
address
needs
in
the
Consumer,
Agricultural,
Industrial,
and
Medical
industries
• New
product
development
and
lifecycle
• Improved
efficacy
and
Medical
compliance
• Product
development
(health
claims)
• Cost
reduction
• Environmental
impact
• Environmental
impact
Consumer
Technology
reduction
(exposure
to
toxics)
Agricultural
(runoff,
overuse
of
products
developers
antibiotics)
• Cost
reduc@on
• Environmental
impact
Industrial
(runoff,
overuse
of
an@bio@cs)
Technologies for targeted delivery, controlled
release, encapsulation, formulation…
7

8. Consumer/Personal
care
products
currently
on
the
market
which
utilize
advanced
delivery
systems
Company
Product
Indica1on
/
Applica1on
Technology
Dermalect
Cosmeceu@cals
Confidence
Injec@on
Crease
An@-­‐wrinkle
Hyaluronic-­‐filling
spheres
Concentra@on
DS
Laboratories
Spectral
DNC
Topical
Hair
Hair
regrowth
Nanosomes
Loss
Solu@on
L’Oreal,
Lancome
Soleil
SoW-­‐Touch
An@-­‐ Cosme@cs
Vitamin
nanocapsules
Wrinkle
Sun
Cream
SPF
15
Celazome
O-­‐Plex
Target
Acne
Spot
Acne
Nanospheres
Treatment
Sircuit
Skin
Cosmecu@cals
Dr.
Brandt
Laser
Relief
An@-­‐itch/rash
Nanoencapsula@on
PerfectRx
Eye
Perfect
Serum
Cosme@cs
Nanodelivery
system
Celazome
New
Zealand
Eye
Treat
with
Lyphazome
Cosme@cs
Nanospheres
Technology
DERMAdoctor
Faux
Fillment
Cosme@cs
(concealer)
Nanospheres
of
hyaluronic
acid
and
fulvic
acid
Nutra
Luxe
M.D.
Lipo
Reduc@on
An@-­‐Cellulite
Cosme@cs
(body
firming)
Nanodelivery
system
Crème
Unilever
Persil
Fabric
SoWener
Fabric
soWener
Polymeric
microspheres
8

9. Agenda
! Targeted
Delivery:
What
it
is
and
why
partnerships
are
especially
important
in
the
field
Medical
! Targeted
delivery
technology
partnerships:
what
both
sides
say
! Best
targeted
delivery
partnership
practices
Consumer
Technology
Agri-­‐
products
developers
cultural
! How
the
targeted
delivery
technologies
stack
up
to
each
other
• Companies
developing
Industrial
delivery
technologies
for
personal
care
and
cosmetics
! Summary
9

10. Targeted
delivery
partnerships
are
the
“end
all
be
all”
for
developers,
not
so
for
buyers
“How
highly
do
technology
developers
“How
highly
do
corpora1ons
value
value
partnerships
with
corpora1ons?”
partnerships
with
technology
developers?”
Buyers
Technology
Developers
Buyers
Technology
Developers
Not
valuable
Not
valuable
Somewhat
Somewhat
valuable
valuable
Valuable
Valuable
Highly
valuable
Highly
valuable
Cri@cal
Cri@cal
0%
20%
40%
60%
80%
100%
0%
20%
40%
60%
80%
100%
• “Collaboration
is
important.
We
have
a
• “Partnerships
have
been
a
part
of
our
technology
that
applies
to
multiple
markets
and
innovation
strategy
for
many
many
years.
We
engaging
with
the
best
experts
in
an
open
and
have
had
over
1500
partners
with
industry,
collaborative
way
is
optimal
to
unlocking
the
start-­‐ups,
and
academia…this
is
a
reason
why
technology
and
driving
new
products
forward.”
have
a
VC
arm.”

11. Corporate
financial
support
and
market
validation
are
most
important
to
targeted
delivery
developers
“What
do
technology
developers
value
the
most
in
corporate
partners?”
! “Financial
support
is
required
to
move
from
proof
of
concept
to
a
marketed
Buyers
Technology
Developers
solution.”
! “We
are
rather
small,
so
we
try
to
Financial
support
participate
in
projects
where
the
partner
has
a
global
reach
and
budget
to
finance
Big-­‐company
name
associa@on
the
R&D
project.”
! “Hitching
our
wagon
to
a
winning
horse
is
Technical
support
essential,
so
market
validation
is
key
for
us.
The
partner
has
the
ability
to
Market
commercialize
the
product
and
exploit
the
knowledge
market.”
Market
valida@on
0%
20%
40%
60%
80%
100%
11

12. Targeted
delivery
technology
developers
add
value
to
a
large
corporation’s
portfolio
“What
do
corpora1ons
value
the
most
in
technology
developer
partners?”
! “If
we
can’t
help
them
build
on
Buyers
Technology
Developers
their
differentiated
pipeline,
we
shouldn’t
be
doing
any
deals
with
Technical
support
them
in
the
first
place.”
! “Technology
developers
are
focused
and
more
driven…they
Risk
mi@ga@on
help
keep
the
big
corporation
ball
rolling…and
have
innovative
ways
Value-­‐add
to
corpora@on's
porholio
of
approaching
the
problem.”
0%
20%
40%
60%
80%
100%
12

13. Buyers
and
developers
have
different
ideas
on
when
delivery
technologies
are
ready
for
the
market
“What
is
the
expected
1me-­‐frame
for
commercializing
research
resul1ng
from
targeted
delivery
partnerships?
! “Commercialization
differs
immensely
with
different
delivery
technologies
and
if
Technology
Developers
they
can
be
applied
late
stage
or
not.”
100%
Buyers
! “Five
to
ten
years
is
more
reality
than
80%
ideal.”
60%
! “Three
to
five
years
because
we
only
expect
to
commercialize
products
using
40%
identified
compounds.”
20%
! “Five
to
ten
years
because
it
takes
that
long
to
get
through
clinical
trials
and
the
0%
regulatory
process.”
0-­‐1
year
1-­‐3
years
3-­‐5
years
5-­‐10
years
10+
years
13

14. Agenda
! Targeted
Delivery:
What
it
is
and
why
partnerships
are
especially
important
in
the
field
Medical
! Targeted
delivery
technology
partnerships:
what
both
sides
say
! Best
targeted
delivery
partnership
practices
Consumer
Technology
Agri-­‐
products
developers
cultural
• Medical
• Consumer
products
! How
the
targeted
delivery
technologies
stack
up
to
each
Industrial
other
! Summary
14

15. Medical
has
decades
of
experience,
but
is
blinded
by
hubris
! Targeted
delivery
partnerships
in
pharma/health
care
lay
the
foundation
for
other
industries
! Targeted
delivery
partnerships
work
together
to
improve
efficacy,
lower
costs,
and
achieve
clinical
milestones
! Structured
licensing
deals
should
be
limited
to
one
product,
with
upfronts,
milestones,
and
profit
sharing
! Delivering
improved
product
performance
leads
to
differentiated
products
and
successful
partnerships
15

16. Medical
application:
Psivida
! Develops
injectable
delivery
systems
for
the
eye;
controlled-­‐release
implants
injected
with
25-­‐
gauge
needle,
resulting
in
self-­‐sealing
hole
! Receives
royalties
from
Bausch
&
Lomb
on
two
products
currently
on
the
market
! Pfizer
has
a
9%
equity
stake,
along
with
co-­‐
development
agreement
worth
$165
million
! Development
partnership
with
Alimera
Sciences
! Partners
obligated
to
make
more
than
$30
million
in
payments
in
the
next
fiscal
year
16

17. Consumer
products
is
looking
for
breakthroughs,
but
often
stretches
the
truth
too
far
! Delivery
partnerships
in
consumer
products
and
personal
care
industry
are
becoming
more
common
! Application-­‐oriented
partners
make
or
break
deals
in
consumer
health
and
personal
care
! Deal
structures
should
be
more
back-­‐
end
loaded
than
pharma
! Targeted
delivery
partners
need
to
work
with
government
officials
and
be
wary
of
health
claims
17

18. Consumer
products
application:
Monosol
Rx
! Thin-­‐film
formulations
for
prescription
and
over-­‐
the-­‐counter
drug
delivery
! Seven
approved
products
on
the
market,
including
children's
laxatives,
children's
cold
medicine,
breath
fresheners,
and
several
other
over-­‐the-­‐
counter
(OTC)
products
! Two
FDA-­‐approved
products
in
2010:
• Zuplenz
(treatment
of
nausea
and
vomiting)
–
partnered
with
Strativa
Pharmaceuticals
• Suboxone
(treatment
of
opiod
dependence)
–
partnered
with
Reckitt
Benckiser
! Ten
to
15
total
partnerships
in
consumer
products,
pharma,
and
biotech
18

19. What
delivery-­‐dependent
industries
can
learn
from
each
other
! Medical:
look
to
consumer
products
for
appeal
and
usability
in
chronic
disease
management
products
Medical
! Consumer
products:
be
wary
of
“becoming
pharma”
too
early,
but
realize
that
it
is
your
future
! Agricultural:
focus
on
process
technologies
and
simple
materials
Consumer
Technology
Agri-­‐
products
developers
cultural
from
consumer
products
to
keep
costs
in
check
! Industrial:
depending
on
the
application,
any
one
of
the
other
three
industries
might
have
a
solution
ready
Industrial
19

20. Agenda
! Targeted
Delivery:
What
it
is
and
why
partnerships
are
especially
important
in
the
field
! Targeted
delivery
technology
partnerships:
what
both
sides
say
! Best
targeted
delivery
partnership
practices
! How
the
targeted
delivery
technologies
stack
up
to
each
other
• Companies
developing
delivery
technologies
for
personal
care
and
cosmetics
! Summary
20

21. The
Lux
Innovation
Grid
Provides
a
Delivery
Technology
Evaluation
Framework
21

22. The
“Technical
Value”
of
a
company
is
determined
by
the
strength
and
value
of
its
technology
Criterion
Description
Weight
Technology/Solution
Qualitative
measure
of
the
value
of
a
company’s
offering,
10%
Value
in
terms
of
performance
and
price
IP
Position
Qualitative
measure
of
the
value
of
the
company’s
patents
30%
or
trade
secrets
and
considers
defensibility
Competitive
Qualitative
rating
of
the
strength
and
amount
of
30%
Landscape
competition
a
company
faces
Targeted
Delivery
Qualitative
score
based
on
key
metrics,
including
30%
Performance
bioavailability
and
speed
of
onset
22

23. A
company’s
ability
to
perform
and
achieve
success
determines
its
“business
execution”
score
Criterion
Description
Weight
Momentum
Qualitative
measure
of
the
rate
of
a
company’s
progress
25%
Partnerships
Qualitative
measure
of
the
strength
and
number
of
a
20%
company’s
partnerships
Revenue/ Company’s
revenue
divided
by
the
number
of
employees;
10%
Employees
measure
of
proBitability
Barriers
to
Growth
Qualitative
measure
of
the
effects
of
impending
obstacles
20%
on
the
company’s
growth
Regulatory
Factors
Qualitative
measure
of
the
effects
regulations
will
have
on
5%
the
company’s
growth
23

24. A
company’s
completeness
reflects
its
“Maturity”
Criterion
Description
Weight
Employee
Count
Number
of
employees
30%
Stage
of
Development
Qualitative
score
given
based
on
the
company’s
primary
30%
product’s
stage
of
development
Revenue
Amount
of
yearly
revenue
30%
Age
Number
of
years
since
company
was
founded
10%
24

25. The
Lux
Innovation
Grid
Provides
a
Delivery
Technology
Evaluation
Framework
25

26. Targeted
Delivery
Companies
Vary
in
Attractiveness
26

27. Companies
focusing
on
personal
care
and
cosmeceutical
industries
27

28. Aegis
Therapeutics
Absorption
enhancers,
peptide
and
protein
stabilizing
agents,
and
self-­‐assembling
hydrogels
for
enhanced
drug
delivery
! Technologies
boost
transmucosal
absorption
and
transdermal
absorption
with
a
wide
range
of
drugs
for
enhanced
delivery
! Two
full-­‐time
employees
;
profitable
! Currently
has
24
licensees,
including
4
"top-­‐ten"
pharma
partners,
a
large
multinational
generics
company,
and
several
others
• Eight
human
clinical
trials
conducted
as
of
2011
by
licensees,
including
Dr.
Reddy’s,
Zelos
Therapeutics,
and
others
! Looking
to
license
absorption-­‐enhancing,
self-­‐
assembling,
aqeous
hydrogel
technology
to
large
dermatology
or
cosmetics
company
for
enhanced
transdermal
delivery
of
cosmeceutical
actives
• In
dermal
applications,
these
hydrogels
leave
the
skin
feeling
soft
with
no
sense
of
any
residue
when
rubbed
onto
the
skin.
28

29. Nanocyte
Micro-­‐injectors
from
sea
anemones
to
enhance
delivery
of
actives
through
skin
! Novel
idea
differentiated
from
other
topical
technologies
with
respect
to
formulation
and
raw
material
source
! Targeting
cosmeceuticals
such
as
topical
ointments
for
dermatology
(acne
and
anti-­‐aging
treatments),
personal
care
products
(anti-­‐perspirant
and
moisturizers)
and
pain
relief
(glucosamine
for
arthritis)
! Closed
investment
round
in
2010,
which
should
help
finance
company
through
next
few
years
! Efficacy
and
value
in
targeted
indications
remain
to
be
seen,
though
premium
prices
will
limit
market
penetration
! Clients
should
engage,
though
wait
until
scale-­‐up
and
cost
metrics
are
demonstrated
for
specific
applications
before
committing
significant
resources
29

30. Salvona
Technologies
Polymeric
microparticles
and
nanoparticles
for
controlled
delivery
of
cosmeceuticals
and
generic
drugs
! Micron
and
sub-­‐micron
spheres
formed
by
encapsulation
technologies
for
timed
and
triggered
release
and
deeper
penetration
of
bioactive
ingredients
! Abandoned
applications
in
agrochemicals
and
home
care,
shifting
focus
to
cosmeceuticals
and
generic
drugs
! Current
area
of
focus
is
in
dermatological
applications
(anti-­‐acne,
rosacea,
and
inflammation)
! Self-­‐funded
throughout
its
12-­‐year
history;
supplier
for
P&G,
Estee
Lauder,
among
others
! Clients
interested
in
cosmeceuticals
and
topical
applications
should
engage,
given
track
record
and
customers,
but
monitor
results
of
change
in
focus
closely
30

31. Dermazone
Solutions
Liposomes
for
topical
drug
delivery,
cosmeceuticals,
and
nutraceuticals
! Launched
FDA-­‐approved
topical
treatment
for
chemotherapy-­‐related
burns
in
February
2010
with
partner
Hi-­‐Tech
Pharmaceuticals
! Two
more
oral
products
on
the
market
with
Source
Vitamin
Company
• Once-­‐a-­‐day
liquid
multivitamin
(launched
May
2009)
• Vitamin
D
liquid
supplement
(launched
June
2010)
! Recent
launch
of
new
nutraceutical
brand,
Hyssop
Health,
for
herbal
supplements
in
2010
! Strong
management
team
and
aggressive
product
development
through
R&D
is
driving
growth
! Subsidiary
Kara
Vita
markets
skin
care
cosmeceuticals
direct
to
consumers
! Interested
clients
in
pharma
and
nutraceuticals
should
engage
now,
but
independently
verify
validity
of
claims
31

32. Summary
&
Outlook
! Innovations
in
targeted
delivery
are
consistently
emerging
and
evolving
! Targeted
delivery
partnerships
are
critical
to
tomorrow’s
products
in
the
consumer
products,
Medical
personal
care,
and
cosmetics
industries
• Partnering
best
practices
can
help
achieve
a
win-­‐win
relationship
! Despite
commonalities,
each
industry
has
its
own
quirks
Consumer
Technology
Agri-­‐
products
developers
cultural
• Medical
has
decades
of
experience,
but
is
blinded
by
hubris
• Consumer
products
is
looking
for
breakthroughs,
but
often
stretches
the
truth
too
far
Industrial
32

33. Thank
you
Chananit
Sintuu
Chananit.sintuu@luxresearchinc.com
www.luxresearchinc.com