BUS205: Whilst Being Trained as an Oncologist, Dr David Chan Witnessed Much Pain: Company and Tort Law Assignment, SUSS, Singapore

Assignment Details:

Whilst being trained as an oncologist, Dr David Chan witnessed much pain and suffering of his patients in the cancer ward. This experience inspired him to develop a liquid biopsy test so that early cancer can be detected without invasive procedures, and the patients can receive treatment at the earliest stage so that their life expectancy and the quality of life can be improved. Dr Chan named his invention “Liquidum” and obtained a patent from the Intellectual Property Office of Singapore.

He conducted several hundred tests for patients across the country in both public and private hospitals. This invention was well received by his medical colleagues and also endorsed by the Ministry of Health. Dr Chan incorporated Liquidum Care Pte Ltd to commercialise his invention. The aim of the company is to enable early detection and treatment of cancers in the quickest possible way without invasive surgeries. His first laboratory and clinic were set up in Orchard Road. He had been granted $100,000 from the government to set up this company.

Over the years, Dr Chan has opened up four more laboratories and clinics, providing diagnostic services to private and public hospitals around the country. Many investors have approached Dr Chan to list the company on the Singapore Exchange (SGX), following a successive listing of two other medical groups that specialised in internal medicine and orthopaedics. Dr Chan has plans to bring his invention to the United States and Europe. However, he is hesitant to relinquish control of the direction of his company.

He concedes that he will need a large pool of funds to expand his business into the American and European markets. In his words, he said “the cost of running a healthcare start-up can be very high. The equipment can be the cost of an HDB flat, with its usual depreciation.” Dr Chan has come to you for advice for fundraising options.

Assignment Question:

Question 1: Illustrate how Liquidum Care Pte Ltd can raise equity and debt from the capital market, taking into consideration the advantages and disadvantages of each type of fundraising.

Question 2: Describe the relevant regulations for the various ways Liquidum Care Pte Ltd can raise funds for its business needs. Make a recommendation to Dr Chan as to which is the most appropriate option.