Burnham Snags $50M Gift, Sparks Translation of Basic Science into New Treatments

1/26/10Follow @xconomy

Big news is out this morning from the Burnham Institute for Medical Research. The San Diego-based nonprofit says it’s getting a $50 million donation from T. Denny Sanford, enough for the whole institution to be re-named in honor of the philanthropist.

The center will now be called the Sanford-Burnham Medical Research Institute. That decision was made now that Mr. Sanford, who made his fortune in the private equity business, has committed to donate $70 million to the research center over the past three years. Besides his direct support of the Burnham, the financier gave another $30 million in 2008 to create the Sanford Consortium for Regenerative Medicine to support stem cell research in San Diego.

This is really just the latest coup for the Sanford-Burnham Institute, which has been on a roll over the past couple of years. The institute scored a six-year $98 million grant from the National Institutes of Health in September 2008 to establish one of four new drug discovery centers at academic centers around the U.S. Its annual budget has seen double-digit annual increases in recent years, climbing to $154 million. The staff has grown to 1,000 people at campuses in San Diego, Santa Barbara, CA and Orlando, FL. The institute loves to talk about how its scientists were ranked No. 1 worldwide in terms of impact over the past decade, as measured by citations in peer-reviewed scientific journals.

That’s all impressive stuff when scientific publications are the coin of the realm, but the Burnham is also well aware its research has yet to deliver a major breakthrough for human health like, say, Novartis’ imatinib (Gleevec) for leukemia. So over the past year, the center has intensified its push to pursue that lofty goal by hiring two key people: One is Michael R. Jackson, a former Johnson & Johnson drug discovery expert; the other is Paul Laikind, a former biotech CEO, to negotiate more deals with drug companies with the money and expertise to create the next generation of Gleevecs. So the Sanford donation is really about fueling a transformation engine that can help the Burnham cross the gap between basic research and real-world applications.

Paul Laikind

Paul Laikind

“Denny Sanford’s continuing generosity will help us make a greater impact on human health,” said John Reed, the Institute’s president and CEO, in a statement.

As it so happens, I heard about this big donation just as I was sitting down to write a feature about how Burnham intends to do a better job of applying its ideas in the wider world, by hiring Laikind as its new chief business officer. Laikind is a biochemist by training, with a 25-year track record as a biotech startup executive, most recently as the CEO of San Diego-based Metabasis Therapeutics (acquired by Ligand for $3.2 million in October). I’ve written a lot in the past couple years about academic centers around the country trying to do a better job of this notoriously tricky business of relating to the business world, including the University of Washington and The Scripps Research Institute, so I was curious to hear Laikind’s perspective.

Donations like the one from Sanford—spread out over five years in $10 million annual chunks—provide a certain amount of budget stability, and could enable researchers there to get tantalizing early experimental data that can be used to help win further federal grants, and maybe entice commercial partners to help sponsor further research. Laikind didn’t want to comment yesterday about the impact of the donation on tech transfer, but that much seems obvious.

When I sat down last month with Laikind in a Burnham conference room, he was talking about something that will be a challenge no matter what. He talked about carefully navigating a new culture, and making sure science isn’t just done for science’s sake. “It’s the Burnham Institute for MEDICAL Research, not just research,” Laikind says. “The motto here is to translate cutting edge science into products that can benefit patients.”

Lots of academic centers say that same thing, but it’s rare for an academic institution to have someone like Laikind with the knowledge of the whole gauntlet of clinical trials and regulatory hurdles that drugmakers need to navigate for years after a basic biomedical discovery is made.

But there are cultural differences Laikind was definitely adjusting to in his first few weeks on the job. Being a CEO means he’s in a position to tell a lot of people what to do, and expect them do it. That’s not quite how it works in academia. “In a company you can direct things and set goals, while at an institution you talk to the scientists and everybody has to buy in,” Laikind says.

So what are the goals in terms of commercial applications, I wondered? It will likely involve a mix of startup formation and licensing of technologies to drugmakers, Laikind says. He’s also interested in what he called “thematic” collaborations, in which say, a company with interest in neurodegenerative diseases agreed to sponsor some research of top Burnham researchers in the field, in return for some rights to commercialize the fruits of the science. Another idea being kicked around is for an incubator to help nurture ideas with commercial potential, Laikind says.

Some might wonder why a place with great basic research, with people who unravel the mysteries of what genes and cells do, would want to get more involved with the more directed, profit-driven world of pharmaceuticals. It really boils down to recognizing that if academics don’t reach out to do more applied work, then it won’t get done, Laikind says. That’s because Big Pharma companies have been cutting back on their basic research budgets, which has opened up the fabled “valley of death” where promising ideas are too mature to receive basic federal funding, but still too risky to receive support from profit-driven companies or venture capitalists.

Given that reality, how far does an academic institution like Burnham have to extend its resources, before a pharma or biotech company will carry the ball forward? I like to use a football analogy to explain what’s going on. In the past, academics might have carried the ball to the 10-yard line, and handed it off to a drug company who would go the remaining 90 yards to the end zone (FDA approval of a new drug). Now the academic center has to carry it to something more like the 30-yard line or so, Laikind says.

What that means is that instead of just elucidating a new target on cells for drug development, Burnham scientists, such as J&J vet Michael Jackson, will go so far as to synthesize new small-molecule compounds to hit the target, and even run screening tests to come up with an optimal small molecule drug candidate that specifically hits the target, and doesn’t appear to hit related targets and cause side effects. But Burnham will not go so far as to do the expensive and time-consuming work of clinical trials—that’s still the domain of biotech and Big Pharma, Laikind says. “We think we can meet Big Pharma partway,” he says.

This is all in the very early stages. Burnham has a staff of about 6.5 full-time equivalents working on technology transfer, doing the work of managing invention disclosures, material transfer agreements between research centers, patent filings, and business development.

The goal at the Institute will be to increase licensing revenues, partly as a way of building up a new stream of financial support, Laikind says. He didn’t provide licensing income figures, but I found that Burnham reported $943,000 in licensing revenue in fiscal 2006, according to a report by the Association of University Technology Managers. That’s a puny sum compared to the $3.9 million in licensing income that flowed that year to the Salk Institute for Biological Studies, or the eye-popping $300.7 million that went to the leading institution that year, Massachusetts General Hospital.

Most institutions don’t really want to flaunt how much money they capture from licensing income, because they don’t want donors to think they are already flush. Burnham is more likely to measure its impact in groundbreaking products that have roots in its research, basically big hits like the Novartis drug that transformed the treatment of chronic myeloid leukemia.

“If you work hard to get products to patients, then revenue will naturally be a part of it,” Laikind says.

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