In April, Texas Health Catalyst and Winstead PC collaborated on a webinar to educate University of Texas at Austin researchers and clinicians, as well as Austin-area entrepreneurs, on the basic principles of how to launch a startup and commercialize intellectual property within the health care industry. This webinar is part of a larger collaboration between Winstead and Texas Health Catalyst: In Texas Health Catalyst’s 2021 project cycle, Winstead attorney Lekha Gopalakrishnan provided one-on-one consultations to all Texas Health Catalyst applicants, where she shared strategies for protecting intellectual property and go-to-market advice.
In the webinar, Texas Health Catalyst and Winstead convened a panel of experts, which included attorneys, UT-based entrepreneurs and more, to tell their stories and help those who are thinking about launching a startup learn how to protect intellectual property, incentivize early employees and determine readiness in starting a company.
Texas Health Catalyst’s director, Nishi Viswanathan, kicked off the webinar with a welcome to attendees and a reminder of the program’s call for applications that supports the development of new innovations in health and health care. Below are summaries of the panelists’ presentations and the advice they gave to attendees, which concluded with a Q&A session.
“Patents 101”: Dan Hussey, associate director of licensing at UT
- Filing a patent is often the first step in creating biotech startup.
- Patents are a legal monopoly that allow you to be the only person to sell claims in the patent, which enables investors to want to take a risk in making an investment.
- Patents have a lifetime of 20 years from the time they are filed.
- On an average year, UT brings in $10-20 million on royalties from licenses.
- Half of patent proceeds go back to inventors.
- Criteria for good patents: new, useful and not obvious.
“What Is a Startup? Should I Launch?”: Lekha Gopalakrishnan, attorney at Winstead PC
- Startups are typically founded by entrepreneurs seeking to develop a product or service for which there is perceived demand.
- Startups should be addressing a problem that exists.
- Innovators need to understand if there is a market/need for the technology and know what regulatory challenges are likely to be faced.
- Have a good understanding of your intellectual property so that you can make it attractive to investors.
- Funding is not necessary or a guarantee of success.
- Innovators need to establish proof of concept and show technical feasibility of an idea.
“Funding Your Startup”: Kristin Naidysh, attorney at Winstead
- Typically, investors want to see a Delaware corporation structure.
- You will get an employer identification number for your startup that will be used for tax returns, engaging with vendors, etc.
- Founders will receive ownership, and key employees will receive equity through options awards and restrictive stock awards.
- Stock options give people the option to buy in at a future date at the equity value of today.
- A “friends and family” round of financing is typically the first round of funding, followed by seed funding, which can include incubator programs that take equity in exchange for advisory services.
“How to Form a Company and Incentivize Key Personnel + Market Analysis + Competitive Advantage”: Mary Weitzel Yaso, co-founder and CEO of Yaso Therapeutics
- You only have one life: Don’t waste it on a weak idea.
- Hope is not a plan.
- Ask yourself the question, “How much of an improvement would new technology be over existing solutions?”
- Be skeptical and ask scientists to see raw data.
- A patent attorney is a must-have.
- You need strong intellectual property to have investors invest in what you are working on.
“How to Partner With the Industry”: Brian Cummings, partner at Alta Ventures; CEO and founder of Technium
- Do your homework and make sure that there isn’t competing intellectual property out there.
- Startups happen at the speed of trust; you need a good team.
- Be careful trusting buyers as the only source of validation for an idea. (It might still cost more money to bring it to market.)
- Be careful that a corporate venture deal isn’t exclusive; look at acquisition rights.
- The medical device industry is notorious for stealing ideas.
- Be careful on what you disclose and how you disclose it.
- If you have an idea, check out if there are universities working on it … it’s worth more to investors.
“Story of a UT Startup”: Maria Croyle, Jurata Thin Film
- A startup at UT looked at a nasal and oral administration platform for Ebola.
- They developed a method to stabilize the vaccine.
- A nasal dose was administered to primates, and 100% survived a lethal dose of Ebola.
- The startup had a robust patent portfolio and learned about market share and market projects.
- The group received funding from Texas Health Catalyst and lab space from JLabs in Houston.
- The tool became a thermoresistant, rapidly dissolving film that stabilizes biologics at ambient temperatures and can be used from long-term storage and drug delivery.
Part of the CoLab at Dell Med, Texas Health Catalyst provides researchers, innovators and entrepreneurs customized guidance on product development from industry and clinical experts as well as milestone-based seed funding.