August 1, 2005 (Vol. 25, No. 14)

Presence of Large Firms and Innovative Spinoffs Help Keep Industry Strong

For the second straight year, North Carolina ranks third behind California and Massachusetts as a biotechnology powerhouse. In fact, North Carolina continues to be the “leading center in the Southeast for biotechnology,” according to Ernst & Young’s Global Biotechnology Report 2005.

The state’s 225 life science companies employ 40,000 people in a variety of biotechnology, drug discovery, lab testing, and biomanufacturing facilities.

Large pharmaceutical firms anchor the industry, including GlaxoSmithKline, Wyeth, and Biogen Idec. Both technology and management know-how migrate from these large firms to spinoff companies. At least a dozen startups sprung from GlaxoSmithKline, including those developing new drugs and contract research organizations.

Much of the activity centers in Research Triangle Park, bordered by Chapel Hill, Raleigh, and Durham, home to the University of North Carolina (UNC), Duke University, and North Carolina State.

“About half the state’s biotech companies are spinoffs of university research,” says Barry Teater, director of corporate communications at the North Carolina Biotechnology Center ( in Research Triangle Park.

The state-funded North Carolina Biotechnology Center, created in 1981, was the nation’s first state initiative in biotechnology. Today the Center promotes economic development by assisting companies with financing, networking, and technology advice. Life science companies also are growing around Wake Forest University in Winston-Salem.

Research Triangle Park is one of the country’s oldest technology parks, started after World War II to create technical jobs to stop the brain drain of graduates from local universities. The first tenants were computer, chemical, and engineering companies. GlaxoSmithKline (then Burroughs Wellcome) was the first drug company to move to the Park in 1970, and the current facility employs 5,000 people.

The 7,000-acre campus employs 40,000 people, and about 10,000 of them work in life science companies. There’s still room to grow, and Research Triangle Park “will peak at 90,000 workers,” says Rick Weddle, president of Research Triangle Foundation (, which develops and markets the Park worldwide.

When companies worldwide are looking to expand “we’re on the short list,” says Weddle. Research Triangle Park, which serves as a model for others starting technology parks, faces the unique distinction of mapping its next 50-year growth cycle.

Future plans include combining bioinformatics and life science efforts. As other states build their first biotechnology parks, “we’re trying to decide what to become next,” says Weddle.

“Biotechnology is incredibly important to North Carolina,” says Lisa Rowe-Ralls, vp of the Council for Entrepreneurial Development (, a private, non-profit economic development group.

In the last five years, North Carolina lost 100,000 textile and furniture manufacturing jobs. The Council for Entrepreneurial Development coordinates efforts to retrain people to work in biomanufacturing. The state’s $60 million tobacco settlement is funding programs at community colleges and universities to work in all aspects of biomanufacturing.

“We’re applying our strong manufacturing work force to the life science industry,” says Rowe-Ralls.

With those new skills, workers should have no problem finding jobs. The biomanufacturing sector is booming in North Carolina. “The combined chemical, pharmaceutical, and medical device manufacturing sector employs 20,000 people,” says Teater.

To encourage more growth, a $36 million Biomanufacturing Training and Education Center is under construction at North Carolina State University. The 91,000-sq-ft facility will open in 2007 to train 2,000 to 3,000 students yearly in an innovative training project. The facility also will attract new biomanufacturing, pharmaceutical, and agribiotechnology companies.

Diosynth Biotechnology (, an 80-year veteran of biologics manufacturing, has two facilities in Research Triangle Park. Both facilities are dedicated to cGMP biopharmaceutical contract manufacturing and process development services of monoclonal antibodies, vaccines, and recombinant proteins.

The cGMP manufacuring facilities include cGMP fermentation and cell culture manufacturing suites up to the 2,000-L production scale. The process-development facilities include separate suites for fermentation and cell culture, downstream processing, protein analysis, and product formulation development laboratories. Separate suites are provided for cGMP stability testing and product storage.

“Our goal is to increase the value of our customers’ pipeline and products. We help our customers succeed by driving products efficiently, rapidly and cost-effectively from preclinical development to market supply,” says Anitra Johnson, marketing and sales associate at Diosynth.

New Endeavors

Those new companies will join the variety of companies already based in North Carolina. Two-year-old Asklepios Biopharmaceutical ( in Chapel Hill is a spinoff of gene therapy discoveries made at the UNC.

Researchers at Asklepios, named for the Greek god who healed incurable diseases, created a Biological Nano Particle (BNP) that “delivers genes, RNAi, and monoclonal antibodies into cells,” says Sheila Mikhail, CEO.

BNP is based on adenovirus-2, known to safely deliver genes. Because adenovirus-2 does not express genes well in muscle, other viral particles are attached. The resulting BNP is a synthetic hybrid that’s 1,000 times more efficient at delivering genes to muscles.

“So less gene therapy is needed, and it’s safer for patients,” says Mikhail. The first gene therapy trials will start late in 2005 to treat Duchenne’s muscular dystrophy, with funding from the Muscular Dystrophy Association (MDA). “It’s the largest grant the MDA has ever given to a for-profit company,” says Mikhail. The next target for BNP will be congestive heart failure.

Xsira Pharmaceuticals (www. not only changed its name from Norak Biosciences in January 2005, but also its focus. Originally a drug discovery tool company, Xsira in-licensed worldwide rights to eight patents held by researchers at the Harbor-UCLA Medical Center, which relate to using adenosine as a painkiller in surgery patients.

“We morphed into a product company with a clinical pipeline,” says Terry Willard, executive president. Xsira plans to develop adenosine as a painkiller for post-surgical pain. Initial clinical studies have been conducted on 300 patients, and Xsira will launch Phase III trials late in 2005. Adenosine given during operations reduces post-surgical pain and the need for addictive narcotics like morphine.

Inspire Pharmaceuticals (www. in Durham licensed P2Y2 technology from the Cystic Fibrosis Research Center at UNC. The original goal was to find drug candidates for cystic fibrosis. But receptor-mapping experiments showed that P2Y2 receptors lie on all mucosal surfaces.

“So we started to study other diseases where mucosal hydration is impaired, like dry eyes,” says Mary Bennett, executive vp of operations and communications. The company has two drugs in clinical trials for ophthalmology disorders that are agonists for P2Y2.

Production in Plants

The production of recombinant proteins in plants is more economical than in bacteria or mammalian cells. Biolex (www. in Pittsboro uses the tiny, floating aquatic plant lemna, or duckweed, as a protein factory.

Lemna is genetically stable, and the recombinant protein is secreted into the growth media and purified. Biolex’ Lemna Expression (LEX) System even makes difficult proteins like cytokines and monoclonal antibodies. Biolex is in a Phase I trial of its recombinant alfa interferon, made with LEX, to treat hepatitis C virus.

Whereas a mammalian cell manufacturing facility costs up to $400 million to build, a LEX facility can be built for $50 million, according Jan Turek, president and CEO. Transgenic animals also can produce recombinant proteins in their milk or eggs, but it takes several generations to breed animal lines.

With LEX, “we can go from a gene to IND in 18 months and double our biomass every 36 hours,” says Turek. Compared to other transgenic plants like corn and tobacco, LEX is contained inside a manufacturing plant. Biolex makes therapeutics for its own development and for strategic partners like Centocor (New Brunswick, NJ).

The sequencing of the human genome surprisingly discovered fewer genes than expected. So genes must undergo alternative RNA splicing to make proteins. Ercole Biotech (www.ercolebiotech. com) in Chapel Hill sees an opportunity to design drugs that interfere with alternative splicing to restore biochemical balance in diseased cells.

Ercole’s Splice Switching Drugs (SSD) modulate RNA splicing in a way that increases beneficial gene products while decreasing disease-related products. SSD are oligonucleotides that bind a targeted sequence in pre-mRNA, then direct the production of a specific form of the spliced mRNA. Unlike antisense, ribozymes, and siRNA, SSD do not knockout a gene.

Drugs in Ercole’s pipeline address cancer, inflammation, cardiovascular disease, and genetic disorders. Ercole’s first gene target, Bcl-s, is widely overexpressed in numerous cancers. One splice variant of Bcl-s promotes survival of cancer cells, while another promotes cell death.

SSD treatment decreases the level of the cancer-promoting variant and increases the level of the gene for cell death. Other SSDs target splice mutations in beta-thalassemia, a genetic disease that leads to iron overload and early death. Impaired gene variants related to cystic fibrosis and Duchenne muscular dystrophy also can be restored to normal with SSD in animal models.

The technology behind Stasix, the freeze-dried blood platelets developed at Hemocellular Therapeutics (, dates back 30 years to hemophilia research at UNC. The company started in Chapel Hill in 2002 to find a substitute for fresh platelets for medical emergencies.

When a blood vessel breaks in the body, platelets form a natural plug to stop bleeding. Stasix is mixed with saline, infused into an injured patient, and quickly stops bleeding until fresh platelets and plasma can be administered.

The freeze-dried platelets in Stasix are treated with paraformaldehyde, which the body recognizes as foreign and disposes of within 15 minutes. However, “that’s enough time for them to pass by the wound site a hundred times and activate a life-saving plug,” says Tom Fischer, Ph.D., company founder. Stasix is undergoing human safety testing for FDA approval.

Speeding up Purification

Based on technology discovered at Duke University, researchers at Phase Bioscience (www. phasebio. com) developed the DeltaPhase Technology that uses elastin-like polypeptides (ELPs) made of amino acid chains. ELPs become soluble or insoluble, depending on moderate changes in temperature and salt concentration.

ELPs speed the purification of recombinant proteins by fusing with proteins in solution. By changing the temperature or adding salts, “the liquid turns to a solid and the good stuff falls out,” says Cindy Clark, company president.

ELPs replace column chromatography purification. “It’s cheaper, faster, and easier,” says Clark. Phase BioScience opened a new lab facility in Durham to make proteins and peptides for clients. The DeltaPhase Technology is scalable from benchtop to bioreactor processes.

In June 2005, Tranzyme Pharma ( raised $32 million in private funds to pursue small molecule drugs for gastrointestinal disorders. “There’s a big hole in the market for new therapies for gastrointestinal diseases and little innovation in Big Pharma,” says Vipin Gard, Ph.D., CEO.

Tranzyme’s chemistry platform creates a library of small molecules that behave more like peptides or proteins, yet are taken orally rather than injected. “Our sweet spot is finding small molecules to modulate ghrelin receptors,” says Dr. Gard.

Next-generation vaccine vectors are in the pipeline at AlphaVax ( in Durham. The company starts with an avirulent form of the Venezuelan equine encephalitis virus, then adds a desired gene that makes the virus produce a protein that acts as a vaccine.

Dozens of genes from different disease targets have been incorporated into the company’s Vector ArV technology, which allows for immunization against new diseases.

For example, the method immunizes mice against HER2/neu-associated breast cancer. The HER2/neu vaccine infects dendritic cells, which produce high levels of HER2/neu proteins. This creates a long-lasting immune memory primed to attack breast cancer cells carrying HER2/neu. In mice implanted with HER2/neu tumors, the vaccine prevents breast cancer in 86% of them.

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