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Application Tech – Business Description
Application Technologies will become a leading developer of proprietary, innovative and value-added packaging delivery systems for consumable products.
Application Technologies’ primary goal is to deliver innovative and value-added unit dose packaging technologies that create better efficacy and ease of use in topical consumable products. By supplying superior packaging to the consumer, Application Technologies will provide an optimum return on investment to our investors, our strategic partners and our employees.
Application Technologies have succeeded in raising a total of $ 455,000 in venture financing. The first round of funds of $ 230,000 are currently being applied towards completion of product development and experimental tooling, while the second round of funding serves to start operations and bring the key founding executives on staff full time. Application Technologies have been incorporated as a California C-corporation, and will become fully operational during May 1999. The inventor of the Appli-K pouch assigned all patent rights for the Appli-K technology to us at incorporation.
The business model of Application Technologies is primarily driven by the unique opportunities offered by our first packaging technology, the Appli-K Pouch.
Description of the Appli-K Packaging Technology
The Appli-K Pouch is a utility patent-pending packaging with built-in applicator. The unique features of the pouch provide opportunities to enhance existing products and develop new products in a wide range of categories.
Unit-dose packaging is becoming a major trend in the $86 billion packaging industry. Pouches and gelcaps are now prominent in a wide range of categories, specifically in skin care, cosmetics and pharmaceutical topical applications.
Currently the only way to apply these packaged ingredients is to tear open the pouch, squirt the ingredient into your hand and apply it to the desired area. Now the ingredient has put unnecessary mess on your hand and has also been contaminated prior to application. And you may even have had to use additional applicators such as cotton balls and Q-tips. It’s inconvenient and non-sterile.
A unit-dose package with built-in applicator solves this problem. However, to date, there has been no cost efficient way to produce an applicator that enables sterile application or make a unit-dose package that is convenient to use.
The Appli-K Solution
The Appli-K Pouch is the first ever unit-dose packaging that addresses the above-described problem. This solution is based upon the following unique benefits:
- A built-in applicator for one-step usage, eliminating mess and additional cotton balls.
- Sterile application based upon this applicator.
- Isolates ingredients from oxygen and light, creating better product stability and efficacy.
- A dual chamber design that enables mixing of ingredients immediately prior to application.
All of these create convenience for the consumer and a sterile application and environment.
Using the Appli-K Pouch as our core technology, Application Technologies will follow a 3-tiered approach, as shown below, to bring the product to market.
- Tier One: We will license the exclusive right use the Appli-K Pouch in targeted topical application categories. These categories will include bum treatment, surgical applications and pharmaceutical topical drugs. In these categories there are substantial barriers to entry to develop ingredients, including FDA regulations and capital requirements. In addition we will provide manufacturing support to licensees. Tooling capability for all three tiers will be developed in alliances with Product Solutions Inc.
- Tier Two: In such cases where the ingredient is in essence a commodity, and has little differentiation, we will private label manufacture. For example, alcohol swabs for use with injection needles. We will develop and own the tooling to produce pouch, and will contract with existing operations for manufacturing and filling.
- Tier Three: This third tier focuses on vertical integration with strategic partners possessing formulation and marketing capabilities. Our sole responsibility in partnership remains the development of packaging. An example here is the alliance between R.P. Scherer and Avon, where Avon introduced their most successful product, Retinol, with $100 million in sales in its first year of introduction, using R.P. Scherer’s gelcap packaging technology.
Our complete business model is shown graphically below:
|Application Technologies Inc.|
|Table of Contents||Appendices|
|1. Executive Summary
2. Business Description
3. Management Team
4. Market Analysis
5. Marketing Strategy
6. Operations Strategy
7. Critical Risks
8. Deal Structure
|Notes on Financials
|All information herein is confidential and belongs to Application Technologies Inc.|