Biotech Needs Charity, and Profit Motive, To Flourish

5/11/09

(Page 2 of 3)

than research, with shortened timelines, often measured in months rather than years. In contrast, Immunex’s blockbuster, etanercept (Enbrel), didn’t arrive on the market until more than 15 years after the company was started.

Money from venture capitalists across America is going more and more towards no research-development only companies (NRDO). Many companies now have just a few quarters to find success or burn through all their cash. Getting the money they need to survive was difficult even before the current economic crisis. And companies with a long-term focus, say on curing malaria, may not get any money at all. Many companies here in Seattle are shedding people, not hiring them. A new researcher at a biotech company today could be looking for another job in a few years, along with a lot of other people. Not a hopeful way to start a career.

So, what would I recommend to a new biomedical researcher with a fresh PhD?

I’d say, check out the non-profits. These are really the only groups that have shown growth in employment numbers over the last few years. They often combine the cutting edge approaches of universities with the sharp focus on human health found in the best biotechs. They have a long-term view, usually directed towards finding a solution to a multifaceted medical problem. And novel approaches are being created to permit these organizations to do more than they ever have before.

Seattle is unique in the country for the number, financial strength and cutting edge research being done by its non-profit research organizations. Most cities are lucky to have one or two high powered research institutions in their midst. We have more than 10 that together are working from over $2 billion in grants for biomedical research.

The Fred Hutchinson Cancer Research Center remains close to the top 25 of all US institutions for discretionary grants from the federal government, with almost $220 million received last year (UW was number 5 with over $475 million received). Even smaller non-profits, such as PATH, the Seattle Biomedical Research Institute, the Infectious Disease Research Institute and the Institute for Systems Biology, are getting large grants from both governmental and non-governmental sources. Just within the last six months or so, the Institute for Systems Biology received a $14 million grant from the NIH to study flu, the Infectious Disease Research Institute received $7 million from the Bill & Melinda Gates Foundation to study treatments for leishmaniasis and the Seattle Biomedical Research Institute received $2.3 million to examine malaria vaccines. There are many more grants funding other non-profits.

These institutions provide a large number of positions for biotechnology in the Seattle area. Written well before today’s current troubles, a report by the Washington Biotechnology and Biomedical Association revealed that non-university research institutions employed more than half of the estimated 7,300 biotechnology workers then in Seattle. The ability of these organizations to gather money from grants indicates that they can continue to support many researchers.

Besides having money for research, these organizations also provide a unique environment for young researchers. Surveys have shown that many starting scientists are looking for something more than a specialized career in academia. Several of our non-profit research institutions provide just that. In the latest poll, just released by The Scientist, examining the Best Places to Work for Postdocs in the United States, the Institute for Systems Biology and the Fred Hutchinson Cancer Research Center were in the top 15.

They have money, they are great places to work and they are focused on the hardest, cutting edge research problems in the world today. This involves such things as personalized medicine, cancer, tuberculosis, malaria, and pandemic flu. At the moment, however, these non-profit research institutions are focused on research, not on developing drugs for human therapeutics.

Yet, this is changing. They are no longer completely satisfied with just pushing the boundaries of science. Organizations such as the Infectious Disease Research Institute are already starting to develop their own therapeutics … Next Page »

Richard Gayle is the founder and president of SpreadingScience. Follow @

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  • http://www.linkedin.com/groups?gid=1904794 Mark Minie

    Rich,

    Thanks for this informative, insightful, and provocative article…

    A few questions come to mind…

    1) Is all non-profit activity in biology focused in biomedicine? (especially in Seattle…)

    2) Can these L3C type organizations fill Seattle’s need for so-called “Small Good Life Sciences Businesses” (SGLSB’s) that are an important part of the “ecosystem” in the acknowledged 1st tier bioresearch regions in the US (BosWas, SF and SD)?

    3) Is there a significant role for high level (PhD) biologists in the support of these types of organizations other than as “bench” researchers?

  • http://www.spreadingscience.com/ Richard Gayle

    Mark,

    Great questions. I focused on biomedicine as most of the statistics I used focused on that. It is a pretty generous umbrella term.

    An L3C appears to be a good fit for many socially responsible investors and non-profit organizations. They have a flexibility that could permit them to be used in several parts of the ‘ecosystem’, including SGLSBs.

    Their advantage comes from the ability to support corporations whose possible return on investment is much, much lower than current efforts. Entire areas of investment become possible.

    An L3C could be organized very much like a for-profit biotech corporation, with the same requirements for experienced PhDs as any other biotech.

    But it could also be organized in a novel fashion to reflect the dual nature of its focus – social good followed by profits.

    In either case, experienced scientists will serve a very important purpose at such an organization, just as they do at the non-profits today.

    The hope is that an L3C, or similar, enlarges the ‘ecosystem.’

  • http://www.lymanbiopharma.com Stewart Lyman

    Nice job, Rich, covering the various job options available to young scientists. Times certainly have changed in the biotech world. I was unfamiliar with L3C organizations; this format may represent an excellent approach for setting up new biotechnology-based groups around town. FYI for readers who are interested, I maintain a hyperlinked list of Seattle biotech non-profits (in addition to Seattle biotechs) on my Website at http://www.lymanbiopharma.com/seattlebionon-profits.html

  • http://www.spreadingscience.com Richard Gayle

    Stewart,

    Thanks for the link. I had meant to provide it in my discussion. Your list had been helpful in my hunt for numbers. Its absence was an oversight.

  • CMCguy

    Richard I too think this article brings up a viable option for researchers to consider at not-for-profits although from practical view I do wonder how many such positions are really available. I may be Generalizing yet in many cases the lab research components seem relatively small staffed, sometimes highly specialized and have little turn over (which can be positives) so can have limited opportunities and/or be highly selective. Also these organizations do not always recruit directly in publications and have connections to groups/collaborators that they source from or work with Recruiters to find candidates.

    I do argue that biotechs are “geared more towards development” than research oriented however could be semantics plus the vast amount of Development that occurs between discovery and approval/commercial products (that is not always as recognized in some circles). The majority of biotechs still are heavy into the “R” side, albeit very directed/goal driven verses academia, and frequently can stumble when try to shift to “D”. The industry has migrated more to the later types but in reality they must go hand in hand. Unfortunately neither type seems highly capable to attract the funding to support vibrant activity in current times.

  • http://www.spreadingscience.com Richard Gayle

    CMCGuy

    All good points. I’m not certain that this approach would necessarily replace the current situation as much as provide a new outlet for innovation. Something like an L3C allows for the creation of a novel institution that could access money for R&D programs that are not profitable enough right now.

    There might be a multi-tiered set of organizations. One, similar to the current situation,works on therapeutics with near-term, high profit potential. The next works on those with a longer term, modest profit potential while the non-profits continue to work on things that, as of yet, have little or very,very long term profit potential.

    The addition of the middle tier could only increase the universe of research positions, as well as all the support personnel.

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  • CMCguy

    Richard I was not discounting the value of such organizations as merely suggesting there many not be a large quantity of employment opportunities from such (which was part of your story). In fact I do see they can often fill gaps that are less emphasized in most academia, biotech or large pharma whether are from finance considerations or maybe the difficulty of the challenge that makes “unattractive”. These type of organizations can be highly focused and goal driven to particular mission while having more latitude and flexibility in time-lines and collaborations than in typical industry situation. With appropriate leadership, capital and perseverance sounds like a feasible approach for promoting innovation to me.

  • http://www.spreadingscience.com Richard Gayle

    CMCGuy,

    I appreciate your comments. I only found out about L3Cs a few weeks ago myself so the feedback lets me know how viable the idea is.

    Just how many positions could be created by a novel approach such as an L3C is really unknown. Getting some real-world experience would be very useful.

    But, I’m hopeful that this might be a productive avenue, particularly with the unique position the non-profit research institutions occupy in the Seattle area.

  • SPACAdvisor

    This is an interesting article, but I agree with CMCguy that there aren’t enough research-based PhD-level jobs in non-profits to make this advice a truly viable option for the majority of PhD-level scientists in the Seattle region, unless one wants to be a perennial postdoc or change careers. Some scientists who want to stay in Seattle ultimately choose to go into a field where they don’t do research, but they still use their scientific training. Examples include teaching, science writing/editing, fundraising, tech transfer, and administration.

  • http://www.spreadingscience.com/ Richard Gayle

    SPACAdvisor,

    I certainly agree that it is very tough for any PhD level scientist. We can have a discussion at another time about the possibility of an overabundance of scientists in the Puget Sound or US and what to do about that.

    But I chose to concentrate on the choices _IF_ the scientist wanted to focus on research in Seattle. The non-profits seem poised for expansion in ways that other possibilities are not.

    Will they be able to soak up all the scientists out there who want to concentrate on research? Probably not. But I think sources of additional jobs are always good. Perhaps this is a way to overcome some of the advantages Boston and San Diego have so that more researchers can stay here rather than move elsewhere.

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