Encouraging the Development of the Medical Technology Cluster in the Greater Baltimore Region

October 2, 2015

Sam Hong, Katharina Schmidt, Joshua Wang, Hao Jia, Donna Cichani, Jing You, Belinda Peng

Hopkins Graduate Students Consulting Club Pro Bono Consulting

● JHGCC PBC is a no-cost consulting arm of

the club that provides strategic consulting by

a student led team of 4-6 PhD, MD, MPH,and

MBA students

● Teams led by experienced engagement

managers

Bmore TECH

Goal and Methodology

Provide strategic recommendations to grow and sustain the medical

technology cluster in the Greater Baltimore region

Benchmark Identify Stakeholders

● Established Companies

● Startups● Incubators &

Accelerators● Universities● Capital Sources● Manufacturers● Local Economic

Organizations

InterviewsObservations

Analyze Resources

● Ideation● IP Protection● Regulatory● Space● Capital● Manufacturing● Labor

Strategy &Solution

Medical Technology in Baltimore

*Size of bubble proportional to publically traded companies HQ in region

Competitive Advantages:

● High Federal & University R&D/ Research Facilities

● Educated workforce● Proximity to FDA

Data from: 1) PWC Moneytree 2) NIH RePORTER 3) https://www.crmz.com/Directory/Industry812.htm

Interviewees: 3 from VC and capital sources, 9 from Med Tech companies, 8 from non-government organizations including

universities

Interviews and Findings

Lack of Big firms

Lack of VCs

Lack of talent

Overall Recommendation

Overall recommendation: The best way to make a hub is through ‘inorganic growth’ by bringing large companies to the

greater Baltimore area.

Big companies provide the MedTech Hub with an experienced talent pool, attract investors and help smaller companies to

grow.

More Jobs

More Talent

Large Firms

Attracted

More Investors

More Capital Benefits received

from attracting large established

firms

To allow large companies to establish innovation centers in Baltimore

Existing non-profit innovation centers:

Recommendation 1

Toronto, Ontario-Health, cleantech, and ICT sectors

raised $1.3 billion, revenue $640M

Rockville, MD-Platform to connect Maryland based

startups with physical resources, capital, labor and

regulatory advisory services+ Presence without commitment to relocation

+ Training of talent pool to occupy C-level positions

- Potential impact limited: no corporate office or headquarters in Baltimore

- Risk of startups being acquired and moved to HQ of large companies

Encourage local established companies to enter med tech market through partnerships

Recommendation 2

Medical Technology

Local Established Non-MedTech Company

Current Revenue Stream

+Diversify Revenue Stream+Potential Synergies+Utilize Existing Experienced Labor+Utilize Manufacturing/Engineering Capabilities

Prioritize later stage companies with more selective, but higher impact funding

Recommendation 3

Prioritize funding to emerging stage companies

Attract VC and private funding source by incentives programs

Continue the Biotechnology Investment Incentive Tax program and others

Further analysis needed to determine the funding size and criteria to selectively fund emerging stage companies

Emerging stage companies

Potential acquisition by large entity, stimulating growth of Med hub

Start-ups

Conclusions

● A majority of CEOs, resource providers, and thought-leaders agree that

experienced management and late-stage capital are needed to make the

Greater Baltimore region into a Medical Technology Hub○ The current grassroot efforts are important and should be sustained

● We believe that this is a ‘critical-mass’ issue that would be best addressed by

increasing ‘large’ companies to the region○ Increase presence of med tech companies through ‘innovation centers’

○ Encourage local non-med tech companies to enter med tech market through partnerships

○ Direct funding to emerging-stage startups through fewer, but higher impact capital

investments to reflect needs of med tech companies