PLSG Technology Development Fund

Fund Purpose.

One of the key strategies of the PLSG is to nurture and accelerate the formation and development of entrepreneurial life science ventures as a means of building a stronger industry base in western Pennsylvania. The Technology Development Fund (TDF) is a competitive funding program designed to further the PLSG’s mission of creating local economic benefit. PLSG seeks to provide financial support to verify the technical and commercial feasibility of inventions within a very early-stage company that will accelerate and increase the likelihood that the technology will be successfully commercialized through a regional start-up company.

The TDF is expected to bridge the gap between discovery research and pre-seed/seed funding and is expected to act as a feeder of projects into the region’s other commercially oriented funding programs.

Evaluation and Awards

Applications to the Pittsburgh Life Sciences Greenhouse (PLSG) Technology Development Fund are accepted on a rolling basis, unless otherwise specified by PLSG. We strongly advise that potential applicants contact PLSG to discuss eligibility and other guidelines prior to submitting a proposal.

Proposals

It is expected that proposals will contain a combination of technology development and business tasks. The TDF can be used in conjunction with or to leverage other early sources of public and private funding such as SBIR/STTR and angel funds. The proposed project should specify clear and definable milestones and timelines that demonstrate the increase of marketability and patentability of a platform technology that has broad applicability and potential to impact large and/or multiple markets.

A primary goal for the fund, and the basis for receiving funding, is to demonstrate the likelihood that the project will lead to creating regional economic benefit. Non-exhaustive examples of projects that are envisioned under the TDF include:

  • Construction and testing of a prototype
  • In vitro or preliminary in vivo testing
  • Side-by-side comparison of new technologies with known approaches
  • Development of a competitive market or technical assessment

Eligibility

Proposals must be submitted by an early-stage company within the 20-county western Pennsylvania regions (Allegheny, Armstrong, Beaver, Bedford, Butler, Cambria, Clarion, Crawford, Erie, Fayette, Forest, Greene, Indiana, Lawrence, Mercer, Somerset, Venango, Warren, Washington and Westmoreland).An early-stage company is defined as a company that has raised less than $2.5 million in investments outside of federal or state grants. The company must demonstrate availability of facilities and resources available to complete the proposed milestones. More than one proposal may be submitted by the company to the TDF program for different projects. Each proposal is evaluated on its own merit.

Use of Funds

Typical investments range from $50K – $250K in total costs of PLSG monies and, consistent with the PLSG’s mission and its policies and procedures, are left at the discretion of the Executive- in-Residence (EIR). Investments require a 1:1 match, which may be cash or in-kind (personnel time, equipment use, materials, software or reduced overhead).Since it is expected that projects will have technical and commercial tasks, a portion of the TDF funds may be used for business development milestones tied to and appropriate for an early-stage technology development project. In general, the PLSG accepts that approximately 10% of the total TDF funds requested may be used for business development activities; prior PLSG approval is required for any amounts in excess of 10% that funding recipients wish to spend for this purpose. Costs incurred for this project are allowed to be back-charged for up to 30 days from the day of execution of the investment agreement. Funding for personnel and consulting costs must be expended within western Pennsylvania. Exemptions may be granted upon request to the PLSG and in the PLSG’s judgment with justification and evidence of best attempt to hire a regional professional. TDF funds may not be used to cover expenses including, but not necessarily limited to, travel expenses to meetings, maintenance agreements, page charges, telephone charges and any other expenses already covered in overhead charges. PLSG monies may not be used to retire accrued debt.

Once a proposal has been approved for investment, the scope of work and any other material component of the proposal may not be changed without written approval from the PLSG. Any such changes desired by a company must be requested in writing to the PLSG prior to being undertaken and will be considered consistent with the due diligence and other evaluation principles and standards governing the PLSG’s review of initial proposals/applications.

Terms

Prior to the release of funds, the PLSG will execute appropriate agreements with the company. Such agreements will reflect whether the subject proposal is an initial or an amended proposal and will specify, as appropriate and among other requirements, use of funds, reporting requirements, and quantitative milestones. The final duration and level of funding for individual projects will be determined by the PLSG. In those instances where the company will subcontract part of the work to a regional research institution, the company will be required to execute a sponsored research agreement, and all related documentation, with the research institution prior to receiving PLSG funds. The investment will be made in a form determined by the PLSG, including but not necessarily limited to grant, loan, equity investment and royalty/payback agreement.All agreements required by the PLSG need to be executed within sixty (60) days of notice of investment, unless otherwise agreed to by the PLSG. Immediate and full payment as provided for in the applicable agreements will be required if the company moves a substantial portion of its operations from the 20-county western Pennsylvania region during a period of five years following the initiation of the project.

Submissions

Individuals interested in applying to the TDF program are encouraged to contact the Director of Investment Programs prior to submitting a proposal. A meeting with appropriate senior PLSG staff will be scheduled to discuss the technology, project and review eligibility, guidelines and mission of the program. Moving forward, each prospective applicant is assigned for case management to an Executive-in-Residence (EIR), who serves as mentor and liaison. The EIR will work closely with the company to ensure the project meets all eligibility criteria. Applications must be submitted electronically. Note that the signed cover sheet must be sent as hard copy to the attention of the Director of Investment Programs.

Proposal Format

Initial proposals should be no more than 12 pages of 1.5-spaced 12-point type, including all tables, graphics and other supporting materials. Requests to modify or otherwise change initial proposals may not need to restate all information provided in initial proposals; companies are encouraged to contact the Director of Investment Programs to discuss and understand what information the PLSG deems necessary to act on requests to modify/change. Initial proposals must be organized according to the following outline:

1) Title and Abstract Pages. (Use form supplied) Include title of project, name of company, technical and administrative contact information, overall budget and project duration. The abstract should have a maximum of 250 words. It should include a project description understandable by a non-technical specialist and a statement of deliverables. This summary should be nonproprietary. Submit completed title and abstract pages electronically as pages 1 and 2 of the proposal. The signed cover sheet must be submitted in hard copy to the Pittsburgh Life Sciences Greenhouse, Attn: Director of Investment Programs, 2425 Sidney Street, Pittsburgh, PA 15203.

2) Summary of the Current State of the Technology.

  • Describe the need or problem that the technology addresses, and the current state-of-the-art approach, practice or treatment to meet the need.
  • Describe key deficiencies that exist in the field. Which of these deficiencies will the new technology fill?
  • Describe what other technical approaches are being crafted to address the deficiencies in the field.

3) Proposed Project Plan. The project plan should include sufficient information for the evaluation of the project. Indicate whether data has been omitted due to confidentiality.

  • Specific Aims. Objectives and the hypothesis to be tested. What need or problem does the project address?
  • Competitive Approaches. How does the approach compare with other technical approaches to the same need or problem? What advantages/disadvantage exist for these approaches?
  • Preliminary Studies. Provide information to support the capacity of the principals to complete the work. Has any preliminary work been done to date? How will this work relate to the long-term objectives?
  • Experimental Design and Methods. Describe how the experiments will be conducted. Point out the technical hurdles and how they might be circumvented.
  • Timetables and Milestones. Describe the milestones, both technical and commercial, that will be reached midterm and upon completion of the project. Identify who is responsible for completing each task. Summarize milestones and responsible personnel in a table. (use form supplied)

4) Market Potential of the Invention.

  • Describe the market need that is filled or met by the invention.
  • Define the target market or customer for this invention. Are there other markets for which it may have application? What products currently serve the target market? How will the technology supplant these existing products?
  • Estimate the size of the market (e.g. number of patients, sales of competitive products, users of the technology, etc.)
  • Explain why this is a growing market

5) Status of Intellectual Property. Describe what has been disclosed and/or protected covering the technology described. What are other patents related to the technology? Are further invention disclosures or patents anticipated from this project? Document results of a patent search, including keywords or search terms used, results and website/database used.

6) Relevance to the goals of the PLSG. Describe the likely commercialization pathway. How will this project contribute to the goals of the PLSG to create, attract and/or retain jobs locally?

7) Key risks. What are the biggest technical risks? What regulatory approvals are needed?

8) Budget. (Use form supplied) Detail and justify proposed direct and indirect costs for personnel, materials and equipment. Include information on proposed matching contributions. Describe any cost-sharing or in-kind support that will apply to this project, including the source and amount. Indicate effort for personnel on the project.

9) Qualifications of key personnel. Include a summary of no more than four pages describing the qualifications of each key participant in the project (The standard four page NIH format is acceptable).

10) Suggested Reviewers. Please describe the qualifications/background of potential reviewers that would be most suitable to evaluate the technology and its benefits.

11) Forms to be submitted with this proposal

  • Coversheet (see Section 1)
  • Milestones Table (See Section 3e)
  • Budget (See Section 8)

Selection Process and Criteria

PLSG intends to subject initial proposal applications and, as applicable, modification proposal applications to a multi-stage review process, including 1) scientific review, technical merit of the proposed project and 2) the recommendations of the PLSG’s Investment Advisory Committee.

Screening and mentoring by Executives-in-Residence (EIR):

Each prospective applicant is assigned to an EIR who serves as mentor. The EIR and Program Director work closely with the company management to ensure that the proposal meets all eligibility criteria and mission of the program. At this stage, the application is considered a ‘draft application’. The team working with the company will look at criteria such as, but not limited to:

Quality of the proposed milestones;

Soundness of the budget;

Probability of technical and commercial success;

Potential for leveraging other funds;

Intellectual Property protection

Once the EIR validates that all criteria have been met, the application will be accepted as a ‘formal application.’

Review by external sources: 

External consultants will review the application for technical merit and completeness of the development plan. No fewer than two reviewers will complete confidential reviews of the proposal and submit a rating sheet to the PLSG. The technical review will center on the following criteria:

Overall technical and commercial merit of proposed work and deliverables;

Applicant’s capabilities and experience relevant to the project deliverables;

Understanding of the market need and competing approaches;

Appropriateness of budget and effort proposed;

Intellectual Property protection;

Relevance to the goals of the PLSG.

If the application receives favorable review and meets all eligibility criteria, the applicant company will be invited to make a presentation on the project to the PLSG Investment Advisory Committee. The Investment Advisory Committee is comprised of PLSG Executive Management and members of the PLSG Executive Program. A vote of a majority of the Committee is required to make a funding recommendation to the PLSG Executive Management, which then makes a determination regarding final investment approval.

Additional due diligence: A project recommended for funding may undergo additional due diligence assessment prior to the Investment Advisory Committee making a final funding recommendation. Information gathered during the due diligence process may be shared with other investment organizations such as but not limited to, Idea Foundry, Innovation Works, UPMC Health Ventures, Novitas Capital and New Spring Capital.

The PLSG will notify all applicants of its decisions regarding their proposal applications. The PLSG reserves the right to select for investment, all, some or none of the proposals received. The PLSG also reserves the right to select portions of individual proposals for investment.

Project Investment and Management

The PLSG will monitor progress of each project, schedule periodic reviews and facilitate interaction among project participants and PLSG as appropriate. Recipients of the investment will be required to submit reports in a format specified by the PLSG and following the approved milestones. Funds will be distributed in according to approved milestones. The final report may also include a presentation to the PLSG. The recipient of the investment will also agree to respond to a periodic survey by the PLSG and disclose follow-on funding and commercialization activity that results from the PLSG-funded project. In connection with the submission, evaluation, selection and/or management of TDF project applications, the PLSG may consider support for preliminary, succeeding, and additional projects. Such consideration will be undertaken in a manner generally consistent with the foregoing information, tailored as necessary and appropriate to specific circumstances.

Announcement

This information is intended to provide Technology Development Fund (TDF) applicants with guidelines for applying and receiving a TDF investment. These guidelines are not necessarily exhaustive and applying for a TDF does not create a contract or any enforceable rights on the part of the applicant. The Pittsburgh Life Sciences Greenhouse (PLSG) retains the right to revise or otherwise change this information and to invest or to not invest funds based on these or other considerations consistent with the reasonable and lawful exercise of its judgment. All investments are subject to the terms of the investment documentation, acceptable to the PLSG and consistent with any and all applicable statutes, regulations and institutional policies. Proposals are solicited for projects that enhance, focus and demonstrate the commercial viability of start-up life sciences technologies being developed by the region’s entrepreneurs and scientists. These technologies should exhibit the clear potential to significantly and positively impact the regional economy.

Contact Information

All questions and correspondence concerning this funding program and solicitation should be directed to the following point of contact:

Alicia Varughese, Executive Associate

Pittsburgh Life Sciences Greenhouse

2425 Sidney Street

Pittsburgh, PA 15203

Phone: 412-770-1341

Fax: 412-770-1276

Email: avarughese@plsg.com

PLSG