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BUSINESS UPDATE:
On June 2002 an agreement was finalized between Molecular
Specialties, Inc. and Intermagnetics General Corporation (IGC)
to transfer the Electron Paramagnetic Resonance (EPR) assets
of IGC-Medical Advances to Molecular Specialties. The EPR
assets were originally acquired by IGC in March 1997 as part
of the purchase off all of the business assets of Medical
Advances, Inc. (MAI). This Milwaukee based company was founded
in 1985 as a technology transfer from the Medical College
of Wisconsin to develop, manufacture and market RF coils for
the MRI industry. The EPR products were included in the original
technology transfer, but were never central to the MRI market.
These products fulfill a niche market among members of the
EPR research community. The role of Molecular Specialties
is to continue to serve this community.
As the result of discussions on collaboration in September
2002, Stelar, s.r.l. and Molecular Specialties, Inc. entered
into an agreement in which Molecular Specialties will serve
at the North American marketing entity for Stelar's Spinmaster
FFC 2000 fast field cycling NMR relaxometer. Stelar introduced
the product in 2000 and has since taken orders and installed
20 FFC NMR systems in Europe. The principals of Stelar and
Molecular Specialties have known each other and worked together
in other areas of NMR for the past 12 years.
In May 2003 Molecular Specialties filed a provisional patent
titled "A Scan Method for Collecting Magnetic Field Maps
in Magnetic Resonance Imaging at High Speeds Using a Single
Radiofrequency Pulse". This element of intellectual property
will give Molecular Specialties a potential position in MRI
and fMRI technology and applications.
Business Plan/Strategy (prepared April 2002)
There is a proposed concept in university-based technology
transfer to create companies that can commercialize "orphan"
or narrow market products. A company of this nature in its
initial strategy will create a commercial platform for products
and technologies that because of limited market size would
not be attractive to larger enterprises, but will fill a void
in market demand. Furthermore, the concept of this sort of
company is not driven by investors demanding a "cash
out" plan. A very successful business can be formed around
an annual revenue stream of $2 million to $5 million. The
concept is to create a business model that generates jobs
in the high technology sector and products that can support
the mission of scientific and medical researchers worldwide.
For the universities that are the origin of the technology,
royalties based on licensing the technology could be expected.
Without the "small company model", esoteric and
narrow market technologies may languish in the files of university
technology transfer offices.
Molecular Specialties is a model of a company that can transfer
university-based technology into "orphan" or narrow
scientific and clinical markets. The foundation market to
be addressed by Molecular Specialties will be electron paramagnetic
resonance (EPR) scientific community. This area of science
explores molecular structures using principles of biophysics
and microwaves as the measurement tool. At the Medical College
of Wisconsin located in the Department of Biophysics (formerly
Biophysics Research Institute) is the National Biomedical
ESR Center. This Federal Government funded laboratory has
an international reputation, and is one of the largest ESR/EPR
research centers in the world. The principal of Molecular
Specialties has had a 17-year working relationship with the
forerunner Biophysics Research Institute. A collaborative
research agreement and the license of intellectual property
will be pursued by the Company from the Medical College of
Wisconsin to market microwave probes and accessories developed
in the Department of Biophysics. These products have been
put into practice in EPR research, and a ready market is expected
to produce revenue for Molecular Specialties in the first
year of operation. Additional EPR products are being developed
and patented by the Medical College of Wisconsin in collaboration
with the Jagiellonian University, Krakow, Poland. Molecular
Specialties will be used as a conduit to take these new products
to market.
Besides the EPR product offering, Molecular Specialties will
be working with the technology transfer offices of the Medical
College of Wisconsin and other universities to identify additional
possible business opportunities synergistic with the Company's
marketing strengths and business strategy. The technology
transfer may not be limited to university based research.
The principal of Molecular Specialties has been approached
by an Italian company to explore U.S. potential for NMR spectrometer
accessories, and several companies involved in the development
of specialty RF coils for the MR research market have approach
the principal concerning collaboration. Collaborations of
this sort have the potential to move Molecular Specialties
into the research instrumentation and medical research markets.
Initially all production of Molecular Specialties products
will be out sourced from suppliers who have expertise engineering,
fabrication and the manufacture of products to be offered.
As volume increases and the economies of scale dictate, manufacturing
will possibly be brought in house. This type manufacturing
will require some specialty machining of parts and electronic
assembly and test. Shipping will be limited to incoming and
outgoing small parcels. As more of the engineering is brought
in house with the transition of the technology, electrical
and electronic type of laboratory space will be required.
With the emphasis in whole in having the State of Wisconsin
become more aggressive in nurturing high technology industries
and the Greater Milwaukee area specifically focused through
Tech-Star in creating enterprises based on local college and
university technology transfer, the strategy and organization
of Molecular Specialties fits the profile.
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