At Perlstein Lab, we’re interested in sharing our experiences so other young biotech companies can learn from us. We like to share our financial information to give you an idea of how and where we spend our money. If you plan to start, or are currently running a young biotech company, feel free to compare your numbers to ours. We’re especially interested to know how other therapeutics/drug discovery companies are faring.

Previously we highlighted our 2014 totals, and January to May 2015. In this post we’ve updated the numbers for Q1 to Q3 2015. So far this year we’ve spent $735,941.19, on a pace for $1MM/year. We believe that’s extremely capital efficient for a lab using four different species in parallel: yeast, worms, flies and patient cells.

Perlstein Lab Q3 Spend Pie Chart

PAYROLL (39%) is our biggest expense with 4 PhD’s, a Virtual Lab Manager, support staff and contractors, and recently we’ve hired some seasoned specialty consultants such as Greg Wagner and Narmada Shenoy for preclinical tox/pharm and formulations, respectively.

TAXES (18%) include federal and state taxes, and several fees associated with operating a company in California.

OVERHEAD (20%) includes rent at [email protected], utilities, and operating costs (such as waste removal). Overhead and Payroll (and Taxes) are fairly fixed costs and do not change much from month-to-month. We will see a spike in the near future as we renewed a Service Agreement for one of our core HTS instruments.

OTHER (10%) includes legal fees, marketing, and travel to conferences as we display our data to the world. Most recently we attended the Global Genes Patient Advocacy Summit. We spent several thousand dollars on academic and BioPharma-focused conferences. These expenditures are like marketing costs because it’s how we spread the word about our progress and receive feedback from the community.

LAB SUPPLIES (13%) fluctuates over time. If we’re not buying big equipment, we spend around $10,000 per month. Compounds, 384-well plates, and sealing film are our most common expenses. The suppliers we spend the most with are E&K Scientific, Cayman Chemical, Chembridge, and Amazon. We can’t stress enough how important it is to have good relationships with suppliers. It will result in lower prices and better customer service, saving time to focus on other tasks.

That low amount relative to total spending is a testament to model organisms, which are inexpensive to maintain. You can see how Lab burn rate compares with our Company burn rate:

Q3 Perlstein Lab Burn Rate

Here are Three More Lessons Learned in 2015:

  1. Contractor management takes more time than planned. In the last two months we’ve hired more contractors. This leads to more emails, invoices & payments, and meetings (via phone, Google Hangout, and in-person). Plan for this extra time commitment when expanding the circle around the core team.
  2. It feels great to get good data. Few moments boost company morale more than when our data proves our model.Recently, data has shown that we’ve identified lead compounds for Niemann-Pick C with unprecedented drug-likeness and a novel mechanism of action.
  3. Company culture matters. You hear this about companies, how important it is to have a team that likes working together, communicates well, and trusts each other. Sometimes data doesn’t work out and morale sinks, but the support of great co-workers creates an environment in which it’s easy to bounce back and prepare for the next hurdle.

This post was created by our HappiLabs Virtual Lab Manager, Tom Ruginis (w/ edits from Ethan)


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