Needs of Global Start-up companies (Deliverable 2) GlobalStart wp1 Studies Deliverable 2 Needs of Global Start-up Companies Table of contents p

2. Estonian Genome Foundation. Ettevõtted ja teadusasutused. Quattromed Ltd. [http://geenikeskus.cma.ee/index.php?lang=est&show=1&sub=8&form_id=5&PHPSESSID=406e0319c2d83e307503c28d99083bf3]

2. Efert, T.. Success stories of two Estonian biotechnology companies. In: Biotechestonia, pp. 12-13

[http://www.investinestonia.com/pdf/BiotechEstonia.pdf]

3. Menrad, K., Bührlen, B., et al. Research on the Estonian biotechnology sector innovation system Final report submitted to Enterprise Estonia, Tallinn, 2003. Fraunhofer Institute for Systems and Innovation Research. [http://www.ut.ee/orb.aw/class=file/action=preview/id=23222/FHuur03.pdf]

4. Frank, L. Biotechnology in Baltics. Nature Publishing Group, 3 p. [http://www.geenivaramu.ee/mp3/Biotechnology%20in%20the%20Baltic%20(Nature%20Biotechnology%20june%202001).pdf]

1. Profile and background

Quattromed is a biomedical company. Established in 1999 by four scientists from Tartu University, it is a spin-off company from the Tartu University, offering molecular diagnostics on the Estonian market. Since the foundation, Mr. Mölder was involved in the company, first as a business consultant, preparing the strategic business plan, and capital budgeting such as cash flow estimations and capital structure. Six months later he became a company’s CEO.
In the beginning, three business lines were run: molecular diagnostic, proteomics, and gene-therapy. Molecular diagnostic is the greatest cash-generator for the company; the development of this area began by 1994 at the Tartu University in cooperation with clinical doctors. As the University researchers were focusing on scientific research, the founders who realized the business potential, established the company in 1999. The company soon realized that the gene therapy involved high risks, requiring high initial investments. However finding investors for high-tech business was difficult, as the venture capital market was/is not developed in Estonia, so the idea was at first abandoned.
From the beginning Quattromed was generating cash from molecular diagnostics. Furthermore, approximately 200 000 € in loan was obtained from the Estonian Innovation Fund in 1999. The loan was used to renew university premises, buy new equipment, and build up the organization. In 2002 additional loan was granted from the same institution for the R&D of a project on proteomics. Part of the loan was transformed into the grant, as the company obtained a strategic investor. As the cash generating capability of the company is limited, the chances for the company to receive a bank loan were small. The problem with foreign investors was that investors grant loans mostly higher than 500 000 €, which was too large amount for the company.
Total assets of the company amount for approx. 400 000 € (2004) from which approx. 200 000 € are intangible assets such as patent protection and R&D development. These assets were financed by approx. 100 000 € from equity and 300 000 € from outstanding loans. The annual turnover has increased from 150 000 € in the year 2000 to 700 000 € expected for 2004.
First patent was submitted to Estonian Patent Office under the principles of the Patent Cooperation Treaty (PCT) in 2001 and in 2004 the Company applied for US national patent based on the same priority.
The customers in the molecular diagnostic are doctors at medical clinics. For proteomics the main customers are researcher from the universities. First customer relationship was established in 1999, a private medical clinic in Tallinn who was interested in molecular diagnostic methods as it believed that such a diagnostic can bring more reliable results. The contacts established with their doctors dated from 1994 from Tartu University. Currently, there are approximately 30 clinics, which are Quattromed’s customers. From these institutions, over 300 doctors are in their customer database. The market share is 60-70% in Estonia. The main competitors are the labs of the clinics, which are smaller in size, as they cannot match their molecular diagnostic capabilities with Quattromed’s. There relationships with the University are not as strong as Quattromeds.
Currently, the company employs 26 persons: 15 laboratory researchers, and 11 administrative personnel. From year 2000 R&D laboratory was established with 5 fulltime scientists working on our partners projects and developing new products The majority of them come from universities, which facilitates their development of relationships.
In the next 2-3 years, Quattromed wants to expand their service capabilities by getting involved in the larger part of the development life cycle.

2. Mapping the major milestones of the company

Pre-venture phase

Foundation

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