Alex Philippidis Senior News Editor Genetic Engineering & Biotechnology News
Facilities are a response to industry’s retreat from in-house R&D and deepening valley of death.
This summer the Regents of the University of California can expect to be formally presented with plans by University of California, San Diego for a $110 million research center designed to speed up development of new treatments by the university and its industry partners. UC San Diego expects the Center for Novel Therapeutics (CNT) to promote interaction between private company researchers and their university counterparts based at nearby clinical facilities, namely UC San Diego Moores Cancer Center and the UC San Diego Health Sciences campus.
“There’s a huge gap between the discovery at the bench and the application of the discovery and development of a new therapeutic,” Thomas Kipps, M.D., Ph.D., the cancer center’s interim director, pointed out to GEN. “And this is intended to make that gap a little less onerous to bridge.”
UC San Diego isn’t the only academic institution developing a translational medicine center. On May 16, the University of Florida (UF) marked the “topping out” of construction through installation of the final metal beam for its $45 million Clinical and Translational Research Building in Gainesville, FL. Slated for completion in February 2013, the building will house the UF Institute on Aging, the Clinical and Translational Science Institute, and an Ambulatory Clinical Research Center.
Not all translational medicine efforts involve bricks and mortar. In April The Ohio State University committed $20 million and Ohio University another $15 million toward a new venture fund designed to finance early stages of biopharma and other innovative technology ventures from the two schools as well as other Ohio-based academic institutions. Dominion Ventures will serve as general partner for the $35 million fund.
The venture fund as well as the UF and CNT projects reflect growing interest by universities toward a more active role in bringing new medicines to market. The evolution reflects a confluence of trends: big biopharma continues its retreat from conducting R&D in-house and move toward buying it from others; startups continue to see declines in available venture capital for research and preclinical work as well as the Phase I testing phase; and academia seeks alternative funding sources to cash-strapped state governments as well as closer ties with those sources.
Changing Role of Academia
The wobbly economy of recent years has shaken governments. Universities, many of which draw millions in funds from those same governments, have to pursue deeper and richer partnerships with industry than previously possible through traditional licensing deals. In the 2010 fiscal year, according to the Association of University Technology Managers (AUTM), institutions responding to the group’s survey recorded a combined $2.4 billion in tech transfer licensing income. That’s up 3% from 2009 yet still almost 30% below the $3.4 billion racked up in 2008.
Universities, like big biopharma, are also looking to translational centers to spread their R&D costs. During FY 2010, AUTM institutions spent $59 billion on R&D, up 9.5% from $53.9 billion a year earlier. While federally funded R&D grew to $39 billion from $33 billion in FY 2009, an 18% gain, industry-sponsored research stayed flat at $4 billion both years.
“If you want to build systems and processes and reward structures that encourage innovative new companies, you need a source of innovation to license technology from,” Todd Sherer, Ph.D., president of AUTM, told GEN. “That’s where the university pretty quickly comes into the analysis.”
For biopharmas, universities are a source not only of new technology but of experts for consulting arrangements and, especially for schools with academic medical centers, often a source of patients for clinical trials, Dr. Sherer pointed out. “More and more, they are telling us that they want to look at our research assets—not just technologies and research opportunities but what assets do you have that we might be able to partner with you in some creative, innovative ways and help make this drug discovery, this R&D continuum work more effectively.”
The translational focus poses a challenge to universities, which as a result must get better at picking translational projects, he noted. Where once universities gave funds freely to researchers, not expecting to see results let alone results with market potential, schools have learned to explore patent possibilities, with help from industry experts during their project selection processes, “so that we can think about clinical and regulatory issues and the kinds of things that might stop a project from getting to market,” Dr. Sherer explained.
Requirements for Success
It could also indicate that there’s a lot of shopping going on by biopharmas, since CNT faces much competition. The San Diego region has several options for startups, from space at numerous research institutes to centers opened in recent years by pharma giants.
Merck & Co. disclosed plans in March to launch a new $90 million nonprofit translational medicine institute. In return, Merck holds options to obtain exclusive commercial licenses to drug candidates resulting from research by the new California Institute for Biomedical Research (Calibr) in La Jolla, CA. Last October Johnson & Johnson transformed part of its La Jolla drug research center into Janssen Labs at San Diego, an incubator for startup drug development and medical device companies. Pfizer, on the other hand, last year wound down operations at a La Jolla incubator it opened in 2007.
One selling point for UC San Diego: It is ahead of the UC system in tech transfer, disclosing 388 inventions in the 2011 fiscal year compared with 367 in FY 2010. That’s a 6% gain compared with an overall 1% increase system-wide to 1,581 inventions. However, UC San Diego’s 10 startups lag behind the 15 created at UC’s San Francisco, Sacramento, and Santa Cruz campuses, and 19 at UC Santa Barbara and the Los Angeles basin.
Ultimately, CNT and other translational medicine efforts will succeed based on how well they deliver on promises to join researchers from industry and academia and especially on how much money both sectors save by teaming up through these centers to deliver new drugs faster. Companies and especially their investors will be looking to the centers to drive down R&D costs plus time to market. The result could lead to conflict with the more expansive and less dollar-driven visions of their academic partners. It’s a conflict both academia and industry will have to work at avoiding in this new marriage of resources.
Alex Philippidis is senior news editor at Genetic Engineering & Biotechnology News.