This business plan is designed to present NovOculi, Inc., to potential investors, and to raise equity capital necessary to start production and continue research and developing its patented products.
The Company
NovOculi, Inc., is a new company that plans to market and develop ophthalmological surgical techniques and tools. During the past two years, NovOculi’s principals have had extensive experience with refractive correction techniques (both laser and non-laser based). The principals have begun to test a new method of incisionless refractive treatment called NICS (Noninvasive Corneal Sculpting br>).
All current refractive procedures, including LASIK and PRK, require the destruction of at most a portion the protective epithelial layers over the cornea. This can lead to complications. The principals have developed an effective method that involves iontophoresis using an ionic drug and a wavelength -specific laser. It allows for efficient refraction with minimal epithelium damage.
NovOculi plans on using NICS to profit from the market opportunities for market expansion and penetration within the laser refraction industry, which is experiencing a nearly doubled demand each year.
Based on financial projections that were prepared by the company’s management it was estimated that equity investment would be required in order to start the company’s operations. The funds will be used in order to test, market, and produce NICS as well as provide initial capital for the first 2 years.
Market Potential
There is a large market for laser refractive surgeries. It is estimated that approximately 54% of the U.S. population (~162 million) has refractive errors, approximately 90% of which are eligible for correction using current techniques or those on the near horizon (Federal Air Surgeon’s Medical Bulletin). In contrast, only 900,000 Americans have had LASIK (the most popular laser correction technique) as of two years ago. This represents just 0.6% market share, leaving 99.4% untapped. (“/Bye-Bye glasses, EyeCare Online). Further, the demand in laser refractive is nearly doubling each year (“/ByeBye Glses,”/ EyeCare Business Online).
The company has contacted nine of the leading ophthalmological medical institutions in the U.S. Seven out of nine leading ophthalmological medical institutions in the U.S. have expressed an interest in collaborative research. They also hope to commercially perform NICS once it becomes available. John Hopkins University (Harvard), Stanford University (Oregon Health Sciences), Duke University (Duke University) and University of California at San Francisco (UCSF) are just a few of the institutions who have expressed an interest.
NovOculi’s principals have also conducted a preliminary market survey at a local grocery market in the Durham, NC area. Fivety-five consumers with refractive error were randomly chosen outside of a local supermarket and asked the survey questions. The Market Survey topic contains a copy of the survey as well as a summary of its findings.
Technology
The principals have developed and patented a revolutionary technique, NICS, and two novel devices which are used to accomplish incisionless refractive correction. The patented technique involves the injection of an ionic color from its polymeric vehicle into a patient’s cornea with the patent iontophoretic device. This device creates a charge, which repels or attracts other charges. After the ionic dye is successfully driven into the cornea, away from sensitive structures and other delicate structures, a laser tuned according to the wavelength of dye can be used to target the dyed cornea to alter its shape. This is similar to current laser refraction protocols. After the procedure is complete, the iontophoretic tool is reapplied. This time, it is with opposite polarity. The dye is then drawn from the cornea by the attraction of opposing charges. Through the use of the patented device and technique, the ophthalmologist performing the procedure will be able to avoid the most troublesome and complication-ridden aspect of current laser refraction surgery: the corneal incision. With NovOculi’s technology, nearly all the complications in current laser refraction surgeries are due to problems associated with the incision process and the healing process.
Strategy A key component of NovOculi’’s strategy to market its technology is to both those performing the procedure and those to whom it will be performed. After the publicity and research data are collected, the sales force will assist in encouraging the initial investment in laser and equipment for the procedure. The demand pull for components will be generated by institutions through direct marketing to patients.
The sales team starts with six experienced salespeople and grows to forty-four by Year 5. The sales team will work closely with laser manufacturers in order to promote the technology to patients and surgeons.
Six U.S. locations will offer NICS training to ophthalmologists: San Francisco (Boston), Atlanta, Philadelphia and Kansas City. Durham, NC is the sixth. Each site will have in-depth training sessions led by a prominent ophthalmic surgeon.
In order to offer patients access to the best technology, doctors will be allowed to charge a premium. NovOculi will extract approximately half of the nearly $1,000 premium through licensing fees associated with its patented procedure and sales of the individual components.
Regulations
Like its predecessor, LASIK, the FDA will not approve the company’s product before widespread usage. LASIK had been performed on almost 900,000 patients without approval by the FDA as of two years ago (Current Trends in Refractive Eye Surgery, 128th Annual Meeting of APHA).
This was possible because the FDA does not approve procedures but only equipment. (‘#8220’Eye centers have set their sights on LASIK procedure growth, Houston Business Journal July 16). The FDA has already approved the components of the procedure for medical use. NovOculi’s patented device and technique will be available for sale without FDA approval. FDA approved similar devices for medical uses in the following fields: 1) The FDA approved the dermatologic use of the 440nm Laser. 2) Iontophoretic device approval has been granted for drug delivery on epidermis. 3) Polymeric contact lenses have been approved and are commonly used as an external aid for refractive correction, and 4) The targeting dye, tartrazine, is the most ubiquitous food coloring additive on the market to date.
Major Milestones
The following are key milestones for the startup period:
- Completion of strategic plan nine months before start date.
- For research grants, applicants must apply at least seven months prior to the date of start.
- All patents, foreign and domestic, must have been applied for at least six months prior to the start date.
- Start-up capital is raised at the beginning date
- All milestones for the second year are in line with the business plan.
Competitive Advantage
NovOculi is uniquely placed to benefit from this market opportunity because of its proprietary, protected positions. Three patents have been filed in the U.S.: one for protecting the reversible iontophoretic device, the second protecting the technique involved in NICS, and the third protecting the unique vehicle for the ionic dye.
The principals have spent considerable time developing and researching the current products to satisfy market demand for a simpler, more safe laser refraction correction procedure.
Financial Summary
Based on detailed financial projections and if the company gets its funding, it will be profitable by Year 4 with a substantial net profit. Below is a summary chart of the projected financial information.
1.1 Mission
Provide innovative designs for the treatment and prevention of ophthalmologic diseases.