Commission Meeting July 25, 2012

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Commission Meeting July 25, 2012
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Innovation Platform Program

• Fiscal Year 2012

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• Purpose
• To link the development and innovation
  capabilities and capacities of
• an already established Innovation Platform and
  all its resources at an
• Ohio college or university or not-for-profit
  research institution to
• specific late stage development and innovation
  needs of Ohio
• companies
• Innovation Platform an already existing
  capacity that incorporates
• unique technology capabilities and
  strengths, talent, equipment,
• facilities, engaged industry partners, a
  track record of research
• commercialization and innovation,
  intellectual property, and other
• resources in a particular technology area
  that collectively can serve as
• a vehicle for significant, industry-defined
  and directed opportunities
• through the development and
  commercialization of new products and
• innovations

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• FY2012 Proposals
• 37 proposals submitted
• 35 proposals passed Developments administrative
  review
• Proposals based in one or more 8 technology
  areas
• - Advanced Materials (13) -
  Aeropropulsion Power Management (3)
• - Fuel Cells Energy Storage (7) -
  Medical Technology (14)
• - Software Applications for business -
  Sensing Automation Technologies (6)
• and healthcare (3) - Solar
  Photovoltaics (3)
• - Situational Awareness and
• Surveillance Systems (3)

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• Program Basics
• Lead Applicants Ohio colleges or universities
  or an Ohio not-for-profit public or private
  research institution. Proposals must include
  collaboration with at least two or more Ohio
  for-profit companies.
• Funding 18 million available (FY12) Award
  range of 1 3 million
• External Evaluator National Academies of
  Science (NAS)

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Review of Proposals to Ohios Third Frontier
Program, 2012-2013 Innovation Platform Program
(IPP) 2012
The National Academies July 25, 2012
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The National Academies

• The National Academies bring together committees
  of experts in all areas of scientific and
  technological endeavors. These experts serve on a
  volunteer basis to address critical national
  issues.
• The National Research Council, which operates
  under the auspices of the National Academies, is
  committed to providing elected leaders, policy
  makers, and the public with expert advice based
  on sound scientific evidence.

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Committee Membership

• Committee of 23 includes
• Working engineers, scientists, academics,
  investors, and businessmen and women
• 3 are elected members of the National Academy of
  Engineering (NAE)
• 2 are elected members of the National Academy of
  Science (NAS)
• 3 financial analysts
• 5 Presidents or CEOs, 1 Vice President, and 1
  Executive Director of private (for profit)
  companies
• Geographically diverse members are from all over
  the United States
• 17 previously served on NRC Committees to review
  proposals for Ohio

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IPP Evaluation Criteria

• Performance Goals
• Will the project have an impact on Ohio in three
  or more of the following areas?
• job creation
• personal wealth
• new sales of products
• company creation or attraction
• follow-on investment
• talent recruitment and
• enhanced Ohio, national, and/or international
  recognition
• Experience and Qualifications
• Is leadership demonstrated in all critical phases
  of the proposal?
• Does the applicant team have the relevant
  experience to perform the work involved?

• Technical Merit Plan
• Can the technical challenges be met?
• Are novel concepts, approaches or methods
  employed?
• Commercialization Strategy
• Does the team understand the total resource
  requirements for achieving market entry?
• What is the specific value proposition of the
  proposed approach?
• Has the Innovation Platform already achieved at
  least proof of principle?
• How closely matched is the project with the
  existing or emerging supply chains capabilities?

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IPP Evaluation Criteria

• Budget Cost Share
• Budget
• Is the budget justified and adequate?
• Cost Share
• Is the cost share necessary and reasonable?
• Does the cost share represent a specific new
  commitment, and is it in the form of cash?
• Is the cost share being used directly in support
  of the Innovation Platform?
• Is the cost share firmly committed, with no
  contingencies or conditions, from known sources
  and available to the Innovation Platform at the
  time of Proposal submittal?
• Does the proposal contain sufficiently detailed
  commitment letters, including an explanation of
  cost share commitment?

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Evaluation of Proposals
TMP Technical Merit and Plan
CS Commercialization Strategy
PG Performance Goals
EQ Experience and Qualifications
BCS Budget and Cost Share
E Exceeds Requirements of the RFP
M Meets Requirements of the RFP
D Does Not Meet Requirements of the RFP
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• Recommended
• Proposals

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• Goal
• Seeks to develop and commercialize new
  ophthalmologic instrumentation, new surgical
  instruments, new contrast dyes, and automated
  software packages that will enhance
  high-resolution optical coherence tomography
  (OCT) systems.

• Strengths
• Innovative
• Highly Desired
• Previous Success
• Extensive leadership and experience

Budget Requested Total Budget 2,999,709
6,489,271 40 to subcontracts
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• Market Size
• Device is aimed to become standard screening
  procedure for all corneal refractive surgery and
  corneal stabilization therapy candidates.
• Currently, the vast majority of OCT imaging is
  performed on retinal patients. This population
  represents approximately 2 million patients in
  the US that can receive an OCT exam up to 4 times
  a year. Opening OCT to the anterior segment
  market adds an additional 11 million cornea and
  refractive patients to the potential market for
  OCT
• Other Economic Objectives
• 10 Technology licenses to Ohio-based companies.
• 5 M in licensing income based on
  Center-developed technologies
• Formation of 5 new companies

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• Goal
• Resolve existing technical issues of the
  polymer-liquid crystal interface, which in turn
  will push core products to the next level of
  commercial success within 3 to 5 years to achieve
  a growth of more than 100 percent.

• Strengths
• Clear Path to near term impact
• Significant long-term potential
• Collaborators will benefit from essentially the
  same research without direct competition

Budget Requested Total Budget 3,000,000 6,00
0,000 70 to subcontracts
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• Market Size
• Total available markets for key KDI product lines
  are large. The writing tablet market is projected
  to be 145M for 2014. Based on current customer
  pull and response, KDI expects 5 to 10
  penetration in the accessible market for the HRSE
  Boogie Board RIP. Similarly AMI is expected to
  demonstrate a 30 increase in market over the
  next two years.
• Other Economic Objectives
• 10M in follow-on investment
• Continued Enhanced Recognition
• 10M in new sales by 2013-2014

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• Goal
• Build on the market introduction of integrated
  positron emission tomography (PET)/magnetic
  resonance imaging (MRI) by Philips Cleveland to
  achieve rapid market growth and global adoption
  of PET/MRI-related products/services in the
  global healthcare community.

• Strengths
• Well established capabilities and capacities
• PET/MRI system has superior imaging quality
  relative to comparative systems
• Strong technical foundation
• High potential for successful commercialization

Budget Requested Total Budget 3,000,000 6,026
,690 5 to subcontracts
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• Market Size
• Philips the within reach market size will be
  at least 1 billion
• Cardinal 2.3B by 2018
• Other Economic Objectives
• 46 M in new sales/revenue by 3 years, 113M by 5
  years
• Attraction of 3 companies by 3 years, 10 by 8
  years
• Follow-on investment of 13M by 3 years, 22M by
  5 years

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• Goal
• Through Additive Manufacturing, develop specific
  composites for applications primarily directed at
  the aerospace industry in Ohio.

• Strengths
• Cost-competitive and potentially much lower in
  cost compared to conventional injection molding
• High level of interest from many potential
  industrial end-users
• Will have a substantial positive economic impact
  on the state of Ohio

Budget Requested Total Budget 2,999,050 6,370
,563 60 to subcontracts
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• Market Size
• The current market size is 1.3B and is expected
  to grow to 5B by 2020 as the production of
  end-use parts accelerates.
• The size of this market, inclusive of all energy
  storage technologies, has been anticipated by an
  earlier Frost Sullivan report as growing at a
  25 compounded rate to reach 6 Billion by 2020.
• Other Economic Objectives
• 50M in sales after 5 years
• 1M/ year in new sponsored research
• Potential Expansion of RPM into Daytons
  Aerospace Hub

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• Goal
• Leverage the existing capabilities of the
  Cellular Therapies Integrated Service, to
  establish a facility that will support
  accelerated commercialization from basic
  research to clinical trials and commercialization
  on an affordable, contract basis to researchers
  and biotechnology companies.

• Strengths
• Will assist in developing protocols for producing
  and releasing cellular therapy materials for
  clinical trials that meet FDA expectations
• Team has the potential to become a major
  contributor in the evolution of this technology
  and its commercialization

Budget Requested Total Budget 2,403,875 4,
807,751 20 to subcontracts
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• Market Size
• The Cell Therapy industry CTI alone (as opposed
  to regenerative medicine, which includes small
  and large molecules, devices and cells) had
  global sales of 410 million in 2008, and is
  predicted to grow to 2.7 billion by 2012 and
  5.1 billion by 2014
• Other Economic Objectives
• 1M in new sales by end of year 5
• Formation of 4-6 new companies by year 5
• 4M in follow-on investment by year 5

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• Goal
• Develop software and other tools to improve
  surgical accuracy in total shoulder and hip
  arthroplasty. This proposal includes the
  development of products designed to facilitate
  pre-surgical planning and improve accuracy of
  component placement during surgery

• Strengths
• Significant progress already made towards
  objectives
• Potential to reduce the cost of orthopaedic
  surgery and dramatically improve patient outcomes
• Reasonable and well-outlined technical plan and
  timeline

Budget Requested Total Budget 2,763,444
5,564,019 50 to subcontracts
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• Market Size
• Other Economic Objectives
• 15M in new sales by year 3, 50M by year 5

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Final Remarks

• Total state funds requested by the 6 proposals
  17,166,078
• The remaining 29 proposals, when ranked against
  the RFPs criteria and requirements, scored
  significantly lower than the recommended 6
• Thank You!
• The National Academies would like to thank the
  State of Ohio for placing its trust in our
  process and in our outstanding volunteer
  committee members.

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• Questions?

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• Interviewees
• Not Recommended

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• Goal
• OSU-CAR is proposing to expand their platform to
  support a broader penetration of Distributed
  Energy Storage Systems through deployment and
  demonstration of modular battery systems and
  associated power management and software
  integration products.

• Strengths
• Well thought-out technical plan
• Solid cost share

Budget Requested Total Budget 2,750,000
5,529,283 36 to subcontracts
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• Market Size
• BPLG estimates the total market size to be 46,
  303,359 in 2012 and 130,407,516 in 2017.
  Estimated Revenues from BPLs solution are
  3,000,000 by 2017.
• Other Economic Objectives
• First year revenues 1M by 2016, revenues
  projected to be over 100M
• Committee Concerns
• Lead applicant lacks familiarity in industrial
  and distributed power generation
• automotive requirements are significantly
  different than utility and community-scale needs,
  and the proposal fails to make a convincing case
  that the team can handle the difference
• Proposal lacks specific commercialization and
  go-to-market strategies
• Proposal does not sufficiently detail the value
  proposition of the products or the present
  competition
• Adoption of smart grid and community-scale
  systems likely to exceed the 3 to 5 year
  timeframe

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• Goal
• Build on an existing capability to make available
  an open architecture hardware-in-the-loop SA
  platform, where companies developing SA products
  can have their technologies evaluated, certified,
  and integrated into fully operational systems in
  order to increase consumer confidence and
  interest.

• Strengths
• Builds on a strong set of academic, industry, and
  Air Force assets
• Strong cost share

Budget Requested Total
Budget 2,763,444 5,564,019 60 to subcontracts
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• Market Size
• Air Traffic Control (ATC) equipment market
  projected to reach 3.9 billion by the year 2017.
• The UAV electro-optical/infrared sensors system
  market will grow from 813 million in fiscal year
  2011 to nearly 1.7 billion in fiscal year 2020.
• Bio- and chemical sensors market is expected to
  experience high growth to be worth 13 billion by
  the end of 2011, and estimates suggest it will
  reach 21 billion by 2016.
• Other Economic Objectives
• Over 4M/year in new sales in 3 years, nearly 9M
  in 5 years
• Around 4M in follow-on investment in 5 years
• Committee Concerns
• No discussion of UAV regulations or other issues
  associated with urban deployment of UAVs
• Serious risk of failure for non-technical,
  non-commercial reasons (public reaction) , and
  economic impacts will require customers--other
  cities--to overcome public resistance to
  deployment
• It is not clear in the proposal that the Air
  Force technology and data to be used in this
  system would remain accessible in a
  commercialization venture, as opposed to a
  military deployment

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• Goal
• Develop and conduct commercialization clinical
  trials to support FDA approval and marketing of
  two Neuromodulation /Neurostimulation devices
  based on the existing platform. One application
  will restore hand and arm functions to patients
  with upper extremity paralysis due to spinal cord
  injury or stroke. The other application will
  provide relief of phantom limb pain in post
  amputation patients.

• Strengths
• Novel and well-planned technical approach
• Clear solution to unmet medical needs

Budget Requested Total Budget 2,763,444 5
,564,019 90 to subcontracts
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• Market Size
• Restoration of Upper Extremity Motor Function
  265k patients with spinal cord injury proposal
  estimates revenue of 6M during the first year on
  the market, growing to 24M by the third year of
  sales.
• Treatment of Chronic Pain following Limb
  Amputation 1.7M patients with amputated limbs,
  95 with chronic pain, proposal estimates revenue
  of 28M during the first year on the market,
  increasing to 70M during the second year on the
  market.
• Other Economic Objectives
• Revenue/year by year 3 6M, in year 5 24M
• 5M in sponsored follow-on research in the next 5
  years
• Committee Concerns
• Proposal fails to disclose the receipt of and
  performance resulting from several related prior
  OTF awards

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• Goal
• Ohio University proposes to use its
  Electrochemical Innovation Platform to transition
  two technologies to commercial products (1) a
  metal recycling process for used battery cathodes
  to recover metals for use in new lithium ion
  batteries (in collaboration with BASF
  Corporation), and (2) develop a low-cost,
  high-accuracy urea sensor for diesel emission
  control (in collaboration with E3 Clean
  Technologies)

• Strengths
• Metal recycling could significantly reduce the
  cost of materials used in lithium-ion battery
  cathodes
• BASF and Ohio University are highly qualified and
  experienced

Budget Requested Total Budget 2,763,444 5,56
4,019 17 to subcontracts
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• Market Size
• Metal Recycling
• Consumer electronics market size 5 to 10B per
  year. The cathode is 50 of the cost of the
  battery cell hence, cathodes occupy 1B per
  year of the consumer electronics battery market.
  Additionally, Decreasing the cost of the cathode
  would result in a 2 to 3B market opportunity
  for cathode materials in the automotive market.
• Urea Sensor
• Today, the market size is approximately 700,000
  units per year. This is expected to grow to
  2,000,000 units by 2016. At 30/sensor, this
  translates to a 60M market.
• Other Economic Objectives
• Over 100M in new product sales by year 5
• New jobs pay nearly double the local prevailing
  wage
• Committee Concerns
• Projects are essentially separate, result
  untenable management plan
• No OEMs are presently onboard with the
  commercialization plan of the UREA sensor
• Insufficient details supplied on the metals
  recycling process and alternate pathways

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• Goal
• To establish an Innovation Platform for Solar
  Photovoltaics (IPSPV) at the University of
  Toledo, which will support the near-term
  commercialization goals of four Ohio-based
  companies. In each case, the collaborators have a
  product that requires additional PV research in
  order to accelerate market entry and sales growth

• Strengths
• Technical tasks are achievable
• Team has extensive experience

Budget Requested Total Budget 2,763,444 5
,564,019 50 to subcontracts
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• Market Size
• WK The US electricity market was 400B in 2009.
  Costs of electricity are going up at rate of 7
  per year, accelerating the time to grid parity
  cross over for PV. The US Electricity market had
  1000 GW of capacity in 2006.
• Isofoton the HCPV market is currently 0.5 of
  the worldwide PV Market. The PV market has grown
  at about 40 year on year for last 15 years with
  26 GW installed in 2011. So the size of the
  market in 2001 was roughly 120 MW. Isofoton
  expects the HCPV market will grow at about
  40/yr., which translates to a size of 168 MW in
  2012, 235 in 2013, 329 in 2014, 461 in 2015, 646
  in 2016
• Other Economic Objectives
• Over 135M in total revenue by year 3, over 300M
  in year 5
• Other details listed as trade secrets
• Committee Concerns
• Questionable past performance on OTF awards by WK
• Recent layoffs and decision to re-tool operations
  at WK raise serious worries regarding succesful
  completion of the project
• Overall solar market may not be receptive to the
  new products described in the proposal

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• Goal
• The team will characterize, grow, pattern, and
  otherwise process compound semiconductor samples
  and give advice and recommendations regarding the
  design of a proposed cryogenic electro-optic
  probe station. Two of the projectsthe
  development of new infrared-detector arrays and
  the growth of bulk gallium nitride (GaN)clearly
  advance the state of the art and can be
  accomplished in the 3-year timeframe.

• Strengths
• The project makes good use of the different
  strengths and capabilities of the participants
• Extensive experience with semiconductor device
  materials

Budget Requested Total Budget 2,763,444
5,564,019 26 to subcontracts
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• Market Size
• CE For IRTAS there is 20M/year market size for
  the next 3-4 years. For Microcam, 20M/year in
  sales are anticipated for the next 3-4 years.
• Momentive world-wide, possibly over 400M by
  late 2013
• Lake Shore A recent 2010 report on the IR
  imaging market says it expects that the overall
  thermal market will be more than 1.1 million
  units in 2016 (3.4 B in value).
• Other Economic Objectives
• Revenues from new products at least 66M/year by
  year 5
• Become an international center of
  semiconductor-based sensor technologies
• Committee Concerns
• Commercialization strategy is flawed using the
  supplied numbers, it is impossible for the 4?
  GaN wafer project to show a profit in the
  foreseeable future.
• Distinct impression that the project is designed
  more to provide opportunities for NWL than to
  create jobs or economic impact in Ohio
• General lack of overlap between the MPM project
  and the rest of the group

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• Goals
• Collaborating with OEMS, this proposal will
  leverage CWRUs expertise to assist companies
  with development and commercialization of new
  products
• (1) with QED, to develop new radiofrequency (RF)
  breast-coil-biopsy-plate systems dedicated to the
  significant reduction of false positives and
  false negatives in breast cancer diagnostics
• (2) with Philips Medical Systems, Inc., to
  develop RF spine coils for both excitation and
  detection of proton signals for ultra-high-field
  scanners and
• (3) with Hyper Tech Research, Inc., to develop
  MgB2 designs of magnetic resonance imaging (MRI)
  systems utilizing higher-temperature
  superconducting main magnets in order to reduce
  the need for liquid helium.

• Strengths
• OPTIMISEs industrial partners include all five
  leading OEMs
• Excellent experience in the field

Budget Requested Total Budget 2,763,444
5,564,019 70 to subcontracts
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• Market Size
• QED total world potential market for the
  products can be estimated at 45M by 2015
• Philips The current annual market remains flat
  at around 6 or 7 systems per year. Growth will
  come however as 7T demonstrates diagnostic
  advantage relative to 3T and achieves regulatory
  clearance
• HT Overall market for magnets in this space will
  be approximately 250 million in the U.S.
• Other Economic Objectives
• Over 20M in revenues/year by year 5
• General expectation of Benefits to Personal
  Wealth, Follow-on Investment, Recruitment of
  Talent and Enhanced Global Recognition
• Committee Concerns
• The proposal does not convincingly detail an
  established platform for the intended projects

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Committee Membership

• Committee members were recruited based on
  technical expertise as well as experience with
  business practices, technology transfer, venture
  capital, and economic development.
• Bias and Conflict of Interest
• Potential members reviewed full list of
  participating institutions and collaborators
  before nomination
• After nomination, each member completed bias and
  conflict forms which were reviewed by NRC staff
  and discussed by the committee

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Committee Membership
T. S. Sudarshan, Chair CEO and President,
Materials Modification, Inc. Viola L.
Acoff Head and Professor, Dept. of
Metallurgical and Materials Engineering, Univ.
of Alabama Catherine G. Ambrose Associate
Professor of Orthopaedic Surgery, Univ. of
Texas David E. Aspnes (NAS) Distinguished
University Professor, Dept. of Physics, North
Carolina State Univ. Carol Cherkis Life
Sciences Industry Consultant, NewCap
Partners David E. Crow (NAE) Senior VP, Pratt
and Whitney (ret) and professor emeritus of
mechanical engineering at the Univ. of
Connecticut

• Paul A. Erickson Associate Professor,
  Mechanical and Aerospace Engineering, UC Davis
• Bruce Gitter
• Senior principle scientist and manager of
  nuclear medicine imaging, Covance Laboratories,
  Inc.
• Jahan K. Jewayni Independent Wealth Management
  Consultant
• Matt Jones
• Partner, Nth Power
• Mohammad A. Karim Vice President for
  Research Old Dominion University
• Chester Kolodziej
• Executive Director, Freedom Field Renewable
  Energy, Inc

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Committee Membership
Laura Mazzola Vice President of Global Health
Products, Wave 80 Biosciences Trent
Molter Associate Research Professor and
Business Development Officer, Center for Clean
Energy Engineering, Univ. of Connecticut C.
Bradley Moore (NAS) Professor of Chemistry
Emeritus at Univ. of California, Berkeley Nabil
Nasr Director, Center for Integrated
Manufacturing Studies, Rochester Institute of
Technology Arthur L. Patterson President and
CEO, CMC, LLC Shalini Prasad Professor of
bioengineering at Univ. of Texas, Dallas

• Lloyd M. Robeson (NAE)
• Professor of Materials Science and
  Engineering, Lehigh Univ. and Principle
  Research Associate, Air Products and Chemicals
  (ret)
• Subhash C. Singhal (NAE)
• Independent Consultant and Battelle Fellow
  Emeritus, Pacific Northwest National Laboratory
• Norman A. Wereley
• Professor and Associate Chair of Aerospace
  Engineering, Univ. of Maryland
• Jim Wheeler
• Senior Vice President of Economic
  Competitiveness Policy and Research, Thomas P.
  Miller and Associates
• Raul E. Zavaleta
• CEO, Indigo BioSystems, Inc.

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Committee Process

• First meeting April 19-20, 2012
• ODOD Presentation on IPP
• Extensive discussion on all proposals
• Through consensus, selected 13 proposals for
  future interviews
• Between meetings, committee members continued
  in-depth evaluation of the 13 interviewees,
  including examination of their financial and
  technical viability
• Second meeting May 30-June 1, 2012
• Held 13 interviews
• Each 50 minute session was conducted in true
  interview format
• After Interviews, held a final dialogue with ODOD
  staff
• Prior performance of interviewees on prior OTF
  grants
• Requirements and objectives of the IPP
• Through consensus, committee determined which
  proposals best satisfied the requirements of the
  RFP and their respective rank-order