Harvard Accelerator Program, Proving Its Mettle with Startups and Pharma Partnerships, Looks to Raise Big New Fund
Here in Boston, we like to tout our universities, our faculty, our students. The academic community is one of the crowning strengths of the New England economy, not to mention a major driver of its global impact. But what have universities done for the local startup and business innovation community lately?
I’m not going to give a full answer here—it’s one of the broader themes I’m exploring around town—but I’ll give you a piece of the puzzle.
Harvard University’s Office of Technology Development has what it calls an “Accelerator Fund” that has been chugging along for four years now, and it has achieved some notable results. As of last month, the $10 million fund has given out $5.2 million in grants, which have supported more than 30 projects over five annual cycles. It’s still early to add up the returns on this investment, but already it has led to more than $10 million in partnership money for the university, and several startups that have received outside venture funding. (The Harvard office declined to give specifics on licensing revenues to date.)
What’s more, the model apparently has proven successful enough that the team is about to begin raising a much bigger fund, in the $20 million to $30 million range. And unlike in the past, when Harvard developed a laggardly reputation when it came to commercializing its research, universities around the country are starting to look at the school as a possible role model for technology transfer and startup development practices.
The Accelerator Fund, which Xconomy wrote about in early 2008, was created to help Harvard scientists commercialize their inventions by forming industry partnerships, licensing technology, and starting new companies, primarily in life sciences and biomedical fields. As technology development head and senior associate provost Isaac Kohlberg puts it, “The pipelines of Harvard were empty.” The school “suffered from a branding issue with stakeholders about the role of technology development,” he says.
Kohlberg and his team, which includes Curtis Keith, chief scientific officer of the Accelerator Fund, were brought in to overhaul Harvard’s tech transfer and development offices. Kohlberg joined the university in 2005 and had previously worked in tech transfer and industrial partnerships in senior roles at Tel Aviv University and New York University. Keith, who joined in early 2008, previously co-founded Cambridge, MA-based CombinatoRx (now called Zalicus) and is a Harvard PhD (in chemistry and chemical biology).
Looking back on the first four years of the Accelerator program, Kohlberg singles out five factors that have been important in its growth:
—Its focus on life sciences, which makes up some 60 percent of Harvard research.
—The governance structure for making investment decisions (a small group of people, mostly from industry).
—An internal project management system, including staff to manage grants, projects, and R&D roadmaps.
—The flexibility to perform certain parts of the chosen projects in external contract research organizations, not just in Harvard labs.
—Being integrated with Harvard’s business development program, which includes intellectual property and licensing transactions.
Meanwhile, the biggest challenge in the early days of the program was having a clear R&D roadmap with milestones for each project, Kohlberg says. “When you build bridges across death valley, you need to make sure the bridge ends up on the other bank, and not in midair,” Kohlberg says.
Part of what differentiates the Harvard program, Keith adds, is that “other universities give out money, but there’s not the sense of ownership and sense of urgency and focus on results.”
So what kinds of projects have received funding from the program, and what has come of them?
One example comes from Harvard professor Tobias Ritter, whose research on adding fluorine to organic molecules (such as pharmaceutical drugs) to make them more stable, potent, and better able to penetrate the blood-brain barrier, was supported in part by the Accelerator Fund. The project turned into a Boston startup, SciFluor Life Sciences, which has an exclusive license on the technology and a group of compounds from Harvard. In May, SciFluor said it raised a $5 million Series A round from Allied Minds.
Another story involves Proteostasis Therapeutics, a well-known drug developer based in Cambridge, MA, that raised a big venture round in 2008. The company’s drug technology, which targets neurodegenerative diseases and other ailments by altering protein homeostasis networks, has roots at The Scripps Research Institute, the Salk Institute for Biological Studies, and Northwestern University. But Harvard scientists Dan Finley, Randall King, and Alfred Goldberg, also working in the field, developed some promising drug compounds and worked with the Harvard tech development office to pursue a licensing deal with Proteostasis. As a result, the three Harvard researchers were recently named scientific co-founders of the company. And in May, Proteostasis inked a strategic alliance with Irish pharmaceutical firm Elan to develop the drugs.
The big aim of such pharma partnerships, of course, is for “one major drug to come out of it,” Kohlberg says. To that end, he says, the five-year goal for the Accelerator Fund is for one or two drug candidates born from Harvard research to be in Phase 1 clinical trials, and for at least one of the program’s startups to enter into exit talks with another company.
But a deeper, more scholarly motivation is baked into the program as well, and it serves as a key driver of the fund. “There is a societal mission inherent in the Accelerator,” Kohlberg says. “It goes directly to one of the core missions of the university, public service, what universities are all about.”