Home > Sample Business Plans > Zif

Zif Medical Devices
Executive Summary

Zif Medical Devices will produce medical syringes with the strategic product benefits of automatic safety, ease of use, and low-cost. Zif (Zero Incident Frequency) will initially target psychiatric hospitals followed by the pre-filled nuclear medicine syringe, family practice, and hospital markets.

Market Need
There are an estimated one million needle-sticks (accidentally getting stuck with an exposed needle during a medical procedure) a year. This costs the medical industry over $3 billion annually to test and treat injured health care workers. The worldwide needle-syringe market is $1.5 billion (12 billion units). Safety syringes have less than a 10% penetration into the syringe market. 80% of the market in the year 2000 will be comprised of safety syringes.1 The market potential for the year 2000 is 9.6 billion safety syringes. This leaves 70% market share potential from now till the year 2000. The demand in the U.S. for conventional syringes was 4.8 billion in 1994 representing $700 million in revenues.

Currently there are several syringes in the market that claim some form of safety. These syringes have had little impact on this market mainly because of their high cost compared to standard syringes, and their inconvenient design. Additionally, most of these safety syringes provide few safety benefits because they require manual intervention to ensure safe operation.

Product Development
Zif's unique product design is based upon extensive market research. Zif 's competitive advantages include automatic safety, ease of use, and low cost.

The Zif design is in the process of being submitted for patent protection. The firm of Woodard, Emhardt, Naughton, Moriarty & McNett of Indianapolis completed the initial patent search and found that Zif has several claims that can be patented. Additionally, Zif has developed two prototypes and has held focus groups with medical personnel at several locations including psychiatric and full-service hospitals. Zif is in the process of testing a second prototype.

Commercialization
Zif will pursue one of the following commercial options:
  1. License the technology to an established medical device company.
  2. Build specialized tooling and contract manufacturing and distribution functions.
Option #1
Zif currently needs $250,000 to complete the patent application, field trials, and Food & Drug Administration approvals. Upon FDA approval, $150,000 is required to commercially license this technology. Thus, $400,000 is required to commercialize this product under Option #1.

Option #2
Pursuit of commercial option #2 will require $400,000 in year one for the development costs as stated in Option #1. $1.47 million is required in year two to launch mass production of this new product. Zif plans to grow through the investment of retained earnings, thus no further capital outlays will be needed.

Zif plans to capture 15% market share of the U.S. psychiatric hospitals and pre-filled nuclear medicine syringe market within three years of operation and 9% market share of the overall U.S. safety syringe market by year five. Further growth will then be pursued through penetrating the overall hospital market.

Financials
Option #1 Option #2
Approach License Manufacture
Capital Investment $400,000 / 20% equity$1.87 million / 30% equity
Overall NPV2 $1.3 $4.4
Return on Initial Investment3191% 176%

Management Team
Zif will be incorporated in order to effectively raise capital and limit shareholder liability. The president of the company will be David Bean. Mr. Bean has a BS in Mechanical Engineering, extensive experience in engineering and manufacturing in the plastics industry, and is acquiring an MBA at Purdue University. Mr. Bean will be responsible for the company's general management, and contract printing, assembling and packaging needs. Hank Cattadoris, an expert mold designer and project engineer with 15 years experience, will be vice president in charge of mold design, procurement, startup, processing and customer molder relations. Joe Schroeder, BA & MBA in marketing, will be vice president in charge of sales, marketing, distribution, and human resources. Tom Evans, MBA in Finance, will be vice president in charge of finance and accounting. Tom has extensive experience as a corporate controller. As the company grows, additional professional help will be hired as the need becomes significant and justifiable.

1 Theta Group research report.
2 Options are discounted at 50% and 30% respectively.
3 Compounded annual return. Based on industry average P/E Multiple of 20.


Zif Medical Devices
Table of ContentsAppendices
0. Executive Summary
1. Product Design
2. Market Analysis
3. Commercial Options
4. Marketing Strategy
5. Manufacturing Plan
6. Organization
7. Corporate Vision, Mission
8. Financial Plan
Depreciation Schedule
S&A Budgets
Sales Forecast
Focus Group Summaries
Testimony
Management Resumes
Patent Attorney's Opinion
FDA Consultant's Option
© 1996 Zif Medical Devices. All rights reserved.