You could say Fiksu, one of Boston’s most buzz-worthy mobile startups, took the lemons its first product gave it, and made lemonade.

The firm, founded in 2008 under the name Fluent Mobile, rolled out a news aggregator mobile app in 2009, to help consumers track and read publications from their smartphones.

“What happened with the app was very similar to what we see with other apps that have a successful launch: lots of downloads in the beginning, and relatively quickly things started to peter out,” says Fiksu CEO, president, and founder Micah Adler.

“We obviously needed to figure out how to market our mobile app,” he says. So the firm contacted mobile advertising networks to take a deeper look at customer acquisition for its app. Fiksu found that attracting customers through these networks cost it roughly $3 for every user download of the mobile application.

“We immediately saw there were tremendous inefficiencies in the mobile marketing ecosystem,” Adler says. The company took that knowledge to develop an algorithm-based service that, six months later, brought the cost of acquiring a customer to well under 30 cents, he says.

At that point, Fiksu could have taken its newfound knowledge on app marketing to build a bunch of (hopefully) successful apps itself, or “use this service to help other people market their apps.” Last year Fiksu officially pivoted its business toward the latter, and spent months further developing its technology to help mobile app makers attract more customers at a fraction of what they were previously paying. It publicly announced the launch of this service last month.

“The idea here is that were able to generate very large volumes of loyal users and we’re able to do so cost effectively,” says Adler. “We’re not just … Next Page »

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A week after settling litigation related to the patents on gene-silencing treatments, Alnylam Pharmaceuticals and others have found themselves in another legal battle over the Tuschl patents related to RNA-interference treatments. This time the University of Utah has named Cambridge, MA-based Alnylam (NASDAQ:ALNY), Max Planck, the Whitehead Institute for Biomedical Research, MIT, and the University of Massachusetts in a civil complaint filed in federal court in Massachusetts on Tuesday, Alnylam said in a regulatory filing.

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Here in Massachusetts, we’re very good at collecting data. This is the state that gave birth to the spreadsheet, after all. But when it comes to launching coordinated action to solve the problems confronting one of the state’s biggest industries, we’re a bit slower.

Back in February, the administration of Massachusetts Governor Deval Patrick pulled together a group of industry, university, and government leaders to think about ways to make the state’s information technology sector more competitive. Participants in the group, which became known as the “IT Collaborative,” floated dozens of ideas (and we collected some of them here). But the Collaborative’s only concrete action was to spend $150,000 on a study to measure the IT industry’s contributions to the state’s economy.

That study is now complete, and Michael Goodman, the chairman of the Public Policy department at UMass Dartmouth, presented its findings yesterday at a public meeting attended by the governor and some 200 industry insiders. Not surprisingly, the study found that the IT industry has an enormous influence on economic activity in the state. The 10,000-plus IT companies doing business in Massachusetts spend $65 billion a year—equivalent to about 18 percent of the state’s GDP—and are responsible for another $29 billion in spending by local suppliers and contractors and $19 billion in consumer spending by employees, Goodman found.

The study did produce a few surprises: it turns out businesses aren’t too troubled by issues like long commute times in Massachusetts or the generally dismal condition of the state’s roads, bridges, and rail lines, for example. It also gathered further data confirming some long-term trends, such as the decline of the computer hardware and networking communications subsectors and the countervailing rise of software companies and IT services businesses.

But overall, there was little in the UMass study (downloadable here) to shock any IT executive, hardware or software engineer, or entrepreneur who has spent a few years doing business in Massachusetts. And in a Q&A session after his presentation, Goodman refused to be drawn out on the policy implications of the study. The farthest he would go was to point to survey respondents’ three biggest wish-list items: reduced business costs, expanded broadband connectivity, and a workforce with better training in engineering, math, and science.

At least two of those items—ensuring broader access to the Internet, and improving secondary and post-secondary education for tomorrow’s workers—are goals shared by virtually every economic development agency in the country. Achieving them would benefit all business sectors, not just the software, hardware, networking, and IT services firms that Goodman surveyed. And the third goal—making it cheaper to do business in Massachusetts, whether through lower employment taxes, simplified regulations, or more grants, loans, tax breaks, and other handouts—is also one that practically every local enterprise would endorse.

In its quest to gather more data, then, it would seem that the IT Collaborative has so far failed to take on issues and challenges that are more specific to the information technology industry—problems fine-grained enough that a) people at information technology firms could offer knowledgeable advice and solutions, and b) doing something about them might have a distinguishable impact.

At the June meeting of the IT Collaborative—which Governor Patrick also attended—Verizon regional president Donna Cupelo made a revealing remark. “Data by itself is useless,” she said. “How do we take further steps—that’s what today is about. It’s so important to take the research findings and make it meaningful, something we can use as a vital tool going forward.” The same thing could still be said six months later.

In new comments at yesterday’s event, held at the offices of Communispace in Watertown, MA, Cupelo said that … Next Page »

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Massachusetts Governor Deval Patrick traveled to Holyoke, MA, yesterday to talk about the next steps for the planned Holyoke High Performance Computing Center, a massive project designed to advance the state of the art in “green computing” for life sciences, cleantech, and other applications, while also bolstering business development in economically depressed western Massachusetts. Construction is slated to begin in the fall of 2010 and be completed in late 2011, the governor said.

The partners in the project—which is a collaboration between the Massachusetts state government, Accenture, Boston University, Cisco, EMC, MIT, and the University of Massachusetts—have raised over half of the money needed for construction, according to a press release yesterday from the governor’s office. (The actual dollar amounts weren’t named in the release.)

Since the state’s initial announcement about the project in June, the partners have made “considerable progress” on a working plan for the facility, according to the release. That includes setting up an organizational and business structure for the center, estimating capital costs and operating budgets, outlining a research agenda, and creating preliminary building designs and construction schedules. It’s expected that the facility will be located somewhere near the Connecticut River, which produces abundant hydroelectric power, or along Holyoke’s network of industrial canals, which could provide cooling water for its computing and climate-control equipment.

The three academic institutions contributing to the Holyoke center—BU, MIT, and UMass—issued a statement yesterday saying they are committed to “work diligently over the next 120 days with the Governor, Housing and Economic Development Secretary Bialecki, Energy and Environment Secretary Bowles, and other cabinet officials, Congressman Olver, Holyoke officials and our colleagues in industry to move to the next stage of planning the HPCC.” The statement said the next steps include acquiring a site, setting up agreements on how the various institutions involved will share responsibility for the center, and raising the rest of the money required.

Several entities assisting with the project—the Pioneer Valley Planning Commission, the City of Holyoke, and the John Adams Innovation Institute—have also collaborated to launch a website called Innovate Holyoke as a resource for news on the facility. The site was developed by Ten Minute Media, a Web design company run by young Holyoke-based entrepreneur Brendan Ciecko, who wrote about the computing center project for Xconomy in June.

In remarks yesterday, Governor Patrick said the computing center would serve as “an anchor of a highly competitive and vibrant innovation district in the Pioneer Valley,” which includes the three western Massachusetts counties traversed by the Connecticut River. “The potential for job growth and advances in technology and research is unprecedented, and both the center and this collaboration will serve to create long term prosperity for Holyoke and regional economies throughout Western Massachusetts.”

[Update, 10/23/09: The John Adams Innovation Institute of the Massachusetts Technology Collaborative has published a useful summary of yesterday's event in Holyoke.]

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Need a better AIDS drug? Want to turn plants into gasoline without going through that whole millions-of-years-buried-in-the-ground thing? The University of Massachusetts is hoping its researchers have figured out how to achieve such feats, and is awarding them grants to help the research along, possibly create new companies, and bring in licensing revenue to fund further research.

The UMass Office of Commercial Ventures and Intellectual Property (CVIP) gave out eight grants of $30,000 each to researchers within the UMass system whose work, the office believes, has strong potential for commercial development. “These grants will help to bring UMass inventions and discoveries into the marketplace and into people’s lives,” UMass President Jack Wilson said in announcing the awards. He said that in addition to educating students, UMass should be “an innovation engine” for the state.

Since 2004, the CVIP has given out 26 of these grants. So far, those have led to four new licenses for UMass-developed technology, $2.5 million in new research funding, and one startup company, which UMass didn’t name. Last year the UMass system brought in more than $40 million in licensing revenue.

Here’s a list of the latest grants:

Jie Song, Orthopedics Department, UMass Medical School
“Resorbable Shape Memory Biopolymer for Spine Fusion Applications”
Song has developed a polymer that mimics certain properties of bone, and that can return to an original shape after being deformed, with the shape change triggered by a temperature change. The hope is that the material will minimize tissue damage and improve bone grafts.

Celia Schiffer, Department of Biochemistry and Molecular Pharmacology, UMass Medical School
“Testing Novel HIV-1 Protease Inhibitors for Viability Against Resistant Viruses from the Clinic”
Protease inhibitors, which interfere with part of HIV’s reproductive process, were one of the great breakthroughs in fighting AIDS, but the rapidly evolving virus has become resistant to some existing drugs. Schiffer’s trying to design new drugs that are less likely to lead to resistance.

George Huber, Chemical Engineering Department, UMass Amherst
“Green Gasoline from Catalytic Fast Pyrolysis of Lignocellulosic Biomass”
Huber is building a prototype reactor that uses heating and cooling cycles and a catalyst to break down plant matter into oils that can be used to make biofuels.

Stephen McCarthy, Department of Plastics Engineering, UMass Lowell
“Novel Biodegradable Bone Plates and Adhesive Bonding”
A heat-activated adhesive should eliminate the need for drilling and screws in surgeries where doctors repair the skulls of children born with congenital defects. The grant will be used to develop an applicator for the adhesive.

Melisenda McDonald, Department of Chemistry, UMass Lowell
“Novel Hydrogel-based System for Maintenance of Mammalian Cells in Culture”
McDonald hopes to make it easier to keep cultures of animal cells alive for use in research with minimal cost by using hydrogels, which are mixtures of water and polymers with a gooey consistency.

Kevin Fu, Computer Science Department, UMass Amherst
“Zero Power Telemetry for Implantable Medical Devices”
Implantable medical devices, such as pacemakers, now include wireless communications to send information on the patient to doctors. By relying on the data receiver to supply to power to monitor the devices, Fu hopes to extend the battery lifetime of the implantable devices, reducing the need for procedures to replace batteries.

Babs Soller, Department of Anesthesiology, UMass Medical School
“Noninvasive Sensor for Optimizing Athletic Performance: Proof of Concept for Novel, Portable Technology”
Soller is building a smaller, lighter sensor than those currently used to monitor a person’s metabolic rate and exercise capacity. The new sensor will also include wireless communication.

D.V.G.L.N. Rao, Physics Department, UMass Boston
“Fourier Phase Contrast Microscope”
A new microscopy technique could yield a major improvement in the types of microscopes used in research.

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Shares of Worcester, MA-based RXi Pharmaceuticals (NASDAQ: RXII) hopped on a bit of a roller coaster this morning when the company—which was spun out of Los Angeles’ CytRx to develop RNAi-based treatments for human diseases—made its debut on the NASDAQ Capital Market. After being distributed to CytRx shareholders last night, the stock began trading at $6.01 and quickly climbed as high as $23.95, before falling back to around $10.50 in the early afternoon.

RXi, formed as a subsidiary of CytRx (NASDAQ: CYTR) in January 2007, was founded by a group of four RNAi researchers, including UMass Medical School professor Craig Mello, who won the 2006 Nobel Prize in medicine for co-discovering RNAi. The company joins Cambridge, MA’s Alnylam (NASDAQ: ALNY) and Boston-based Dicerna Pharmaceuticals on what many believe will be a growing list of local firms focusing on turning RNAi’s gene-silencing abilities into treatments for a host of diseases. (See Dicerna founder John Rossi’s take on the field’s potential, for instance, or Alnylam CEO John Maraganore’s.) RXi’s IP portfolio includes a suite of patents licensed from UMass, Cold Spring Harbor Laboratory, and the Carnegie Institution of Washington.

CytRx’s own stock climbed yesterday from $1.59 to $1.87, and followed RXi up a bit further this morning before dropping back down to around $1.70. As a result of last night’s distribution, the California company now owns approximately 49 percent of RXi’s outstanding shares.

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At a meeting in Boston this morning, Massachusetts energy and environmental affairs secretary Ian Bowles signed a memorandum of understanding with University of Massachusetts president Jack Wilson calling for the creation of a committee to coordinate research, education, and public service activities around clean energy. Bowles said that an “effective inter-organizational approach” like that outlined in the memorandum was needed to meet the clean energy needs of Massachusetts citizens. Wilson noted that the university’s energy expertise—with at least 120 researchers studying areas such as offshore wind energy, microbial fuel cells, and cellolusic biofuels—could help the state compete for leadership in the cleantech industry, and he pointed to the university’s existing track record of commercializing clean energy ideas, including UMass spinoffs Konarka and SunEthanol.

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The Massachusetts legislature promised Governor Deval Patrick he’d get some action this month—on his long-delayed billion-dollar life sciences initiative, anyway—and it delivered right on Valentine’s Day. The House yesterday unveiled its version of the bill, which according to media reports is largely faithful to the one the Governor introduced in May.

Indeed, the 10-year, $1 billion House plan mirrors Patrick’s by earmarking half the money (in bonds) for capital projects, a quarter for research grants, and a quarter for targeted tax credits, according to the Boston Globe. But House Speaker Salvatore F. DiMasi “is seeking to put his own imprint on the life sciences plan with an array of narrowly targeted, regional spending initiatives that would benefit individual companies, communities, and University of Massachusetts campuses. Even roadbuilders, vocational high school students, and scientists in Israel get a piece,” wrote the Globe‘s Matt Viser.

Some such goodies include $12.6 million for an I-93 interchange near Wyeth Pharmaceuticals’ (NYSE: WYE) 1,800 person Andover campus and $12.9 million for water and sewage-treatment infrastructure improvements in Framingham (where Genzyme is expanding). And the University of Massachusetts is a big winner, getting a planned $95 million to build a life science center at its Amherst campus and $90 million to help build a center at the medical school campus in Worcester focused on genetic therapy and RNAi-based medicine.

Bolstering RNAi research, and helping to establish the Worcester center, have always been key parts of Patrick’s plan. Indeed, UMass Medical School professor Craig Mello—who shared a 2006 Nobel Prize for co-discovering RNAi, a technique for turning genes off—had written the Governor an eloquent letter explaining the vision behind the center just a few months before Patrick first announced his initiative in May at the BIO conference. At that time, Patrick earmarked $38 million for the RNAi center, which is projected to cost nearly $300 million overall.

The House is expected to vote on the bill by the end of the month.

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Almost every presentation on incubating early stage technology companies includes some reference to the “Valley of Death” or the “Funding Gap”—meaning the difficulty entrepreneurs have finding initial small investments to get their startup companies going and to complete technical viability and proof-of-concept work.

Several research institutions and universities have been busy over the last five years creating internal programs to help bridge the Valley of Death and move technologies closer to commercialization. This year the Massachusetts Technology Transfer Center (which I run) will grant $800,000 in state funding to about 20 “proof of concept” projects at Commonwealth research institutions. The Deshpande Center supports MIT faculty in commercializing their technologies—and Boston University, UMass, and the University of Vermont have similar (but much smaller) projects. These programs usually include a lot of other business support—advising, coaching, marketing studies, introductions to potential investors or industry partners—which helps ensure that viable business propositions are developed alongside the technical work.

This early-stage support for technology development moves the discoveries from “we think it will do this” to “it isn’t pretty, and it isn’t optimized, but it works.” And the business support helps in pitching discoveries in a compelling way to venture and industry investors. The results of these projects are impressive: several new companies have been formed and funded, and based on these successes several other institutions are considering developing similar programs.

But building a bridge over the “Valley of Death” only works if you have enough resources to build it all the way over the valley—or if someone is building from the other side and you meet somewhere in the middle. It was initially thought that angel investors would help fill this gap. While angels can provide both funding and sound advice to early stage companies, they cannot handle the volume of deals and investment required—even in a state with as many angels as Massachusetts.

There are several very new initiatives that are bigger in scale, that have more resources, and that support early stage companies in more advanced development. Partners HealthCare has created a fund which invests in spin-offs based on inventions from Massachusetts General Hospital and Brigham and Women’s Hospital. UMass is now able to co-invest in its spin-off companies alongside venture capitalists. Brook Ventures is working on a new seed fund focusing on companies spinning out of New England research institutions. Biogen Idec, Pfizer, and Novartis all have new incubator programs. Is this the start of a trend, and is there going to be more funding available to support our very early stage companies over the funding gap—or am I just an optimist?

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UMass Lowell announced today that it will build an $80 million center for nano- and bio-manufacturing research, among other projects. The Emerging Technologies and Innovation Center will be built with a combination of state, federal and university funding.

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You can’t spend much time in Kendall Square without realizing how critical universities are to the local innovation ecosystem. One way to look at the role they play is to look at the startup companies formed around technology invented in academia. That’s exactly what I’m about to do—and if you want to cut to the chase you can click here—but first, a conundrum:

In the course of helping Bob get this company off the ground, I’ve had to dig up answers to innumerable startup-related questions that previously I wouldn’t even have thought to ask. Does the term sheet include a double or single trigger for acceleration? Where does one send an 83(b) election if one normally files taxes electronically? If the office lease specifies that tenants have to arrange nightly cleaning, does that literally mean somebody has to clean the place every night?

So far I’ve managed to come up with reasonable-seeming answers for each of these queries as they’ve arisen. But this week I ran into one that has me stumped: When is a startup founded? Where along the timeline of kicking around ideas, writing up plans, pitching them, filing patents, hiring consultants, writing new plans to replace the ones shot down in the first pitch meetings, squeezing cash and free labor out of friends and family, hiring lawyers, filing trademarks, reserving domain names, cold calling investors, filing incorporation papers, looking for office space, alpha testing a product, printing stationery, closing a financing deal, dealing with the broken toilet in the new office, and actually putting a product in the hands of customers—where along that timeline do you put the arrow that says “Company Founded?”

Turns out, folks at different companies and in different universities’ tech licensing offices have wildly different answers to that question. And that complicated things tremendously when we asked five schools—MIT, Harvard, Boston University, Tufts, and UMass—to tell us about the new companies founded around their intstitutions’ technology since the beginning of 2006. Typically, I’m finding out, universities peg the founding of a spinoff to the date when the company licensed the school’s patents. Individual companies might use that date, or they might use the date of their incorporation, the date of their initial funding, or some other milestone. (The strange thing about the licensing approach is some companies wind up being incorporated years before they’re “founded.”)

Thinking back, it’s surprisingly hard to pinpoint a single moment when Xconomy went from being an idea/project/pipe dream to being a real company. The closest I can come is May 8, 2007–the day we incorporated in Delaware. And so in whittling down contenders for our list of recent university spinoffs, I limited myself to only those with incorporation or formation dates in 2006 or 2007. That meant I had to drop some really interesting companies (MIT spinoff Tempo Pharmaceuticals, for instance, was incorporated on November 28, 2005), but at least it levels the playing field. And to be clear, this is not meant to be exhaustive; many spinoffs this young are still so stealth that they haven’t yet authorized their parent institutions to talk about them. But even with those limitations, I think the list–found here–provides a nice snapshot of the latest wave of technologies flowing out of university labs and into the marketplace.

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Below are some of the Boston area’s newest university spinoffs—including companies incorporated or formed since January 2006—and the schools from which they spun. For more on how we generated the list and determined the founding date for each (who’d have thought it could be so tricky?), see here.

Ascent Therapeutics
Sherborn, MA
(Tufts, 2006)
Ascent was launched by former Epix Pharmaceuticals CEO Mike Webb to commercialize work from Tufts-New England Medical Center. The firm is focusing on developing treatments for cancer and inflammatory diseases. In an article last year, Webb told the Boston Business Journal that Ascent would likely partner with an Indian firm for chemical development and preclinical testing.

BA Logix
Medford, MA
(Tufts, 2007)
BA Logix (short for Boolean Accelerator Logic Systems) was launched by pre-seed investment firm Allied Minds to commercialize technology from the lab of Karen Panetta, an associate professor in Tufts’ Department of Electrical & Computer Engineering and a BA Logix co-founder. In a press release, Panetta says that the company’s image-processing and compression technologies “can support a broad set of end users and optimize their wireless, security, video and signal processing needs.” Allied Minds’ other portfolio companies—all launched with university partners—are all in the biomedical sector.

BosteQ
Boston, MA
(Boston University, 2006)
BosteQ’s founders, Boston University associate professor Lars Oddsson and the Massachusetts Eye and Ear Infirmary’s Conrad Wall, are developing wearable devices—tricked-out belts and socks, essentially—to help elderly people improve their balance and avoid falling. Mass High Tech has more details on the technology and the challenges BosteQ will face in getting the technology to market.

Bind Biosciences
Cambridge, MA
(Harvard and MIT, 2006)
Founded by MIT’s Robert Langer and Harvard Medical School’s Omid Farokhzad, BIND (for BioIntegrated NanoDelivery) is developing treatments for cancer, inflammatory disorders, and cardiovascular disease based on nanoparticles targeted to specific cell types or tissues. Polaris Venture Partners and Flagship Ventures are both backing the firm.

ExProDx
Boston, MA
(Boston University, 2006)
ExProDx was founded by BU School of Medicine professors Avrum Spira and Jerome Brody to develop DNA-based diagnostic tests for lung cancer risk determination and diagnosis. In July, the firm won a $175,000 Launch Award from BU’s Office of Technology Development. According to a BU announcement, the firm is using the cash “to prepare for an upcoming clinical trial, legal and regulatory consultants, personnel, and working capital,” so evidently these guys know how to stretch a dollar.

Encapsion
(UMass Lowell, 2006)
This nanotech/biopharmaceutical firm was founded around technology invented by UMass Lowell professors Stephen McCarthy and Robert Nicolosi. The firm, which is targeting a range of pharmaceutical and consumer-product applications for its technology, raised $7.5 million in a first-round of financing this January. New York’s Ascent Biomedical Ventures is an investor.

GMZ Energy
Newton, MA
(MIT, 2006)
GMZ has licensed four MIT inventions, each centered on thermoelectric materials and nanomaterials—which can convert heat to electricity and vice versa. The company is quite stealthy, but in state filings the president, treasurer, secretary, and director are all listed as Michael Clary at the Sand Hill Road (Menlo Park, CA) address of Kleiner Perkins Caufield & Byers.

iWalk
Cambridge, MA
(MIT, 2006)
MIT Media Lab professor Hugh Herr, himself a double amputee, co-founded iWalk to commercialize PowerFoot One, a robotic prosthetic ankle. The device, which allows users to have a more normal gait by adjusting the ankle’s positioning, stiffness, and power on the fly, is slated to hit the market next summer.

Lakewood Pharmaceuticals
Sarasota, FL
(Tufts, 2007)
Lakewood develops treatments for infectious disease. Its lead candidate is a human monoclonal antibody-based treatment for food poisoning caused by certain e. coli strains. The technology was originally developed by Saul Tzipori, director of infectious diseases at the Cummings School of Veterinary Medicine at Tufts.

Nara Biosciences
Boston, MA
(Boston University, 2006)
This early stage drug-discovery company was co-founded by Kenneth Walsh, a PhD biochemist and professor in the Boston University School of Medicine. A licensing deal is still in progress, according to N. Stephen Ober, director of innovation and entrepreneurship in BU’s Office of Technology Development, but the company plans to target obesity and metabolic disease.

RXi Pharmaceuticals
Worcester, MA
(UMass Medical School, 2006)
RXi was formed as a subsidiary of biopharmaceutical firm CytRx to focus purely on RNAi-based therapeutics for a host of ailments, starting with neurodegenerative diseases, cancer, diabetes, and obesity. UMass’s claim on the company is that three of the firms co-owners—including Craig Mello, who shared a 2006 Nobel prize for his role in the discovery of RNAi—are professors at the UMass Medical School. What’s more, RXi has licensed a suite of patents from the school (the firm has a three-year deal granting it options to all unrestricted therapeutic RNAi technology developed there) as well as from Cold Spring Harbor Laboratory and the Carnegie Institution of Washington.

Sand 9
Boston, MA
(Boston University, 2007)
Funded by General Catalyst Partners and Khosla Ventures, Sand 9 develops radio frequency components for wireless devices. The company was founded “to deliver integrated circuit economics to the front-end-module of wireless transceivers,” according to a job ad for the firm (in case anybody’s looking).

SunEthanol
Amherst, MA
(UMass Amherst, 2006)
Biofuel firm SunEthanol’s founder and chief scientist is UMass Amherst microbiology professor Susan B. Leschine. Leschine and a colleague discovered a cellulose-degrading microorganism in soil near the Quabbin Reservoir; now dubbed “the Q microbe,” the bug forms the basis of SunEthanol’s technology for converting corn stover, wood chips, switch grass, and other plant material into ethanol. Investors include VeraSun Energy, Battery Ventures, Long River Ventures, and AST Capital; UMass has an equity stake as well.

TetraPhase Pharmaceuticals
Watertown, MA
(Harvard, 2006)
Built around an exclusive license to technology developed in the lab of Andrew Myers, chair of Harvard’s Department of Chemistry and Chemical Biology, Tetraphase is developing new tetracycline antibiotics targeted at drug-resistant bacteria. Last year the company raised $25 million in Series A financing from Mediphase Venture Partners, Fidelity Biosciences, Skyline Ventures, Flagship Ventures, and CMEA Ventures.

Quanterix
Cambridge, MA
(Tufts, 2007)
In 1998, Tufts chemistry professor David Walt co-founded San Diego-based Illumina, which staked an early claim in the SNP genotyping field. Now he’s helping to put together a local startup, Quanterix, with aims to build single-molecule and single-cell analysis systems for drug discovery and diagnostics. Arch Ventures, Bain Capital 
Ventures, and Flagship Ventures are all investors.

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A packed ballroom full of conference goers is avidly waiting for UMass Medical School professor Craig Mello to tell them about RNA interference, or RNAi—the discovery of which earned Mello and his collaborator, Stanford’s Andrew Fire, last year’s Nobel Prize. Mello is not about to disappoint, but the first slides in his PowerPoint are not your typical highlights from the scientific literature. Instead, there’s a snapshot of a slightly uncomfortable-looking Mello standing next to a slightly dour-looking Vice President Dick Cheney. (Not exactly the same shot as this White House photo by David Bohrer, I think, but you get the idea.) In the upper left corner of the slide, Mello adds: “Vote!” And if that doesn’t work, he adds in the upper right: “Educate!!”

Last November, fresh off the announcement that he and Fire had won the Nobel and just ahead of the White House visit where this picture was taken, Mello made a valiant effort to educate the President himself about the importance of funding RNAi, and other biomedical research. For the conference crowd, gathered two weeks ago at Boston’s Seaport Hotel, Mello boils down the message of his one-page letter to the President: “We drilled the well, and the oil is flowing, but we need a pipeline.” But evidently, almost a year later, says Mello, “the letter is still on the desk.”

After Mello’s talk, I somehow managed to slip through the phalanx of fans angling for photos and autographs long enough to make my own request: I wanted to see that letter, and I wanted to share it with Xconomy’s readers. Mello was generous enough to oblige. (You can read the letter here.) He also shared a second letter, written a few months later to the newly elected Massachusetts governor, Deval Patrick. In it, Mello outlines the promise of RNAi as a research tool and, eventually, as the basis for medical therapies. He then lays out in some detail the resources required to build an “RNAi Therapeutic Center” at the UMass medical school. This time, the note must have struck home because when Patrick unveiled the details of his $1 billion life-sciences initiative last month just such a center featured prominently in the plan.

What I love about these letters is how artfully each addresses its intended audience. (To Bush, Mello writes: “Importantly, RNAi is a natural process that occurs in all our cells, and its use to treat and study disease raises no ethical concerns.”) What troubles me is how differently Patrick and Bush reacted. If a U.S. researcher who’s essentially hopping the plane to Stockholm as he writes can’t get any response from the President, what member of the scientific community can?

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Editor’s note: The following is a letter written by Nobel Laureate Craig Mello to President George W. Bush on November 26, 2006. For more on the letter and its outcome see this post.

Dear Mr. President:

I wanted to take this opportunity to make you aware of an exciting advance in medical research. This discovery, called RNA interference (or RNAi), was recognized this October with the Nobel Prize just eight years after its first description, and only five years after its first application in the study of human disease. Coupled with the human genome map, RNAi is now rapidly advancing our understanding of the inner workings of the human body and of the underlying causes of disease. RNAi holds great promise as a direct therapeutic intervention for devastating diseases including Alzheimer’s, Cancer, Lou Gehrig’s disease, HIV, Diabetes and many others. These include diseases like Pandemic Flu that pose serious threats to our National Security.

Mr. President, RNAi is so new that no other President has had an opportunity to make policy decisions that will capitalize on its potential. RNAi is of broad relevance to both public health and to the vital biotechnology and pharmaceutical industries that employ so many of our citizens. Importantly, RNAi is a natural process that occurs in all our cells, and its use to treat and study disease raises no ethical concerns.

RNAi was discovered in the United States through research sponsored by the National Institutes of Health (NIH), and although RNAi is already speeding the discovery of new drugs and therapies, more can and must be done. Most importantly, we must continue to invest in medical research, both to alleviate human suffering, and to insure that this country maintains its leadership in the biomedical sciences. This investment will yield new discoveries, while allowing researchers around the country to rapidly advance the many avenues of research that are now open to us thanks to RNAi.

Mr President, I sincerely hope that you will act without delay to bring RNAi and its implications to the attention of Congress and to the people of our country. It would be very appropriate for you to mention RNAi and your intention to increase NIH funding in your State of the Union Address in January. The discovery of RNAi along with our nation’s sweep of the Nobel prizes in the sciences and economics are great news for our country. Your action now can ensure that the United States of America continues to lead the world in the advancement of science and technology. I look forward to the opportunity to meet you on the 30th of November and to provide you with further information.

Very Sincerely Yours,

Craig C. Mello
Blais Professor of Molecular Medicine
University of Massachusetts Medical School

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Editor’s note: The following is a letter written by Nobel Laureate Craig Mello to President George W. Bush on February 21, 2007. For more on the letter and its fate see this post.

Dear Governor Patrick:

It is a pleasure to write in response to your recent note. In a year in which I have had so many wonderful things happen, I want to thank you for your excellent description of RNAi at our celebration in Worcester on January 26 and for your recent invitation to share my thoughts about the possibility of some funding in your upcoming capital budget for our efforts at UMass to advance this exciting science.

I know that you have been in discussion with University of Massachusetts President Jack Wilson about similar investments in the University. It is my understanding that he forwarded to you a draft report done by a panel of faculty from Amherst and the Medical School identifying the opportunity to build a program in Stem Cell Research and Developmental Biology. The report responded to the requests of the University’s Science and Technology Committee of the Board of Trustees as well as provisions in the Stem Cell legislation passed in 2005.

The recent report forwarded by President Wilson builds on the many strengths within the University and includes resources for important shared technology hubs that would enhance the work of University scientist and student researchers. We could not overstate the importance to all our research of the $12 million investment proposed for these vital cores, which include a Gene Silencing Core, a Proteomics and Protein Fractionation Core, a Microarray Core, a Sequencing and Synthesis Core, a Chemical Biology Core and a Bioinformatics and Computational Biology Core.

While embedded in the proposal around Stem Cell Research and developmental Biology, the ‘Cores’ President Wilson is proposing provide essential tools to our research initiatives in RNAi.

More specifically, however, over more recent months, those of us working on RNAi based gene silencing have been developing a proposal to capitalize on our preeminent position and expertise and create an RNAi Therapeutic Center (RTC) here at the Medical School.

If Small Molecules were the therapeutic modality of the 1950′s and 1960′s (with over 1000 approved products and over $175 billion in sales); and Proteins and Antibodies became the modality of the last decade (now with over 200 approved products and over $40 billion in sales); we believe the next great modality will be RNAi.

Our RTC will provide key reagents and expertise for RNAi-based screens and discovery of novel proteins that function in cellular processes and human diseases. The RTC will also develop new technology for increasing the effectiveness of RNAi in gene silencing, both in cell systems and in intact animals. The vision for this Center emphasizes facilitating and promoting clinical and translational research by application of RNAi to testing hypotheses on underlying mechanisms of disease processes and ultimately to developing the next generation of powerful drugs to treat a broad range of diseases including cancers, Alzheimer’s, diabetes and heart disease.

RNAi has become a premier research tool across the entire range of biological fields, based on its specificity and potency in silencing gene expression in both primary and cultured cell systems. Its utility is being increasingly enhanced by further innovations and applications. Furthermore, RNAi has now been shown to be effective in silencing genes in intact animals and is being tested in humans. Importantly, this technology will greatly facilitate the development of the next generation of medicines for a broad range of human diseases.

The Medical School has amply exploited its unique position at the forefront of the RNAi. World-class scientific advances in the field from our scientists include: a.) discoveries of novel components and mechanisms that promote RNAi function in gene silencing, b.) the development of novel chemistries to stabilize and deliver RNAi to target cells, c.) the application of RNAi to alter gene expression in primary tissues of the body and d.) the use of RNAi to screen for genes that function in a variety of cell processes and disease states such as cancer and diabetes.

UMMS scientists are at the cutting edge of research in all these RNAi fields and represent a critical mass of talent and expertise that can be mobilized to further develop powerful RNAi technologies and to make them available to all scientists at the Medical School and beyond.

We seek to build an RTC with the following concentrations:

Screening and Target discovery. RNAi screening is a powerful approach to discover genes that function in specific cellular processes that can be assayed in single cell or high throughput format. The Center will procure and be a repository for RNAi reagents (libraries of silencing RNAs) that facilitate the knockdown of every gene in the human genome. The center will prepare these RNAi libraries in forms (retroviral and lentiviral vectors) that permit the delivery of silencing RNA to a variety of cell types commonly utilized in the laboratory. These libraries can then be applied by investigators to diverse systems in target discovery programs.

The RTC will need to constantly acquire the equipment and technology that is as cutting edge as is our science. To maintain our preeminent position, we will need to be THE place that has the latest, fastest most accurate tools to do the science and push it along the development pipeline towards therapeutic products. The inability of individual scientists from their grant funds—or even groups of scientists pooling their resources to create self financing ‘cores’—to purchase and/or access technology where the leaps in speed and accuracy is matched only by leaps in expense is holding us back from reaping the full rewards of the genomic revolution. The RTC hopes to provide resources to unlock these opportunities.

The Center will also provide expertise in design, processing and quality control for these RNAi libraries in order to facilitate their widespread use. Expertise in assessing off target effects of RNAi involving such confounding issues as interferon or toll receptor responses will also be available. Already several Medical School laboratories have had major success with RNAi screening in discovery of novel proteins that function in cancer cell metastasis and cell signaling pathways. These discoveries have high relevance to potential therapeutic approaches to such diseases as cancer, diabetes and degenerative diseases of the central nervous system like Alzheimer’s and ALS (Lou Gehrig’s Disease).

RNAi chemistries for stabilization and delivery: UMMS scientists have already discovered exciting new ways of prolonging the lifetime of RNAi in serum and in tissues—thus extending the time and extent of gene silencing. The Center will build on this novel technology to further improve RNAi stability. Center scientists will test these improvements in animal models. Similarly, UMMS scientists have invented ways of using nanotechnology to enhance the delivery of RNAi to specific tumors and organs. The use of nanoparticles and nanotubules in conjunction with stabilized siRNA will pave the way for the therapeutic use of RNAi in humans. A key goal of the Center will be to further innovate in the field of RNAi chemistry and retain the cutting edge position that the Medical School enjoys in this field.

RNAi-based gene silencing in human diseases: A major goal of the Center is to engage clinical and translational scientists at UMMS and elsewhere to promote their research. Researchers with disease models and hypotheses to be tested with respect to specific genes of interest will be supported in their efforts to silence such genes in vivo. Acquisition of gene-specific siRNA and appropriate co-factors (e.g., nanoparticles) will be facilitated by the Center in support of clinical researchers’ projects. GMP quality siRNA will be generated with quality control methods to assure purity and efficacy. Delivery methods will be tailored to the needs of the investigator. Importantly, the Center will employ scientists who are expert in the handling of animals and the delivery of RNAi in vivo. This expertise will be invaluable to both clinical and basic researchers who wish to test important hypotheses within whole body conditions. The Center envisions its expertise being extended to delivery of RNAi for gene silencing to primates and humans in the near future.

Resource needs

We are early yet in the evolution of our plans. As you can imagine, the more we think about the opportunity the more we think we can do and the more resources we will need. At this juncture, however, we have identified some of the building blocks—what we might term ‘Phase One’. In addition to the $12 million for research cores embedded within the University’s Stem Cell and Developmental biology initiative, our RNAi Therapeutic initiative will be looking for resources to meet the following initial needs:

• $20 million to develop laboratory and support space that may need Good Manufacturing Practices/Good Laboratory Practices (FDA standards of operations) capability to produce RNAi for use in animals and humans; instrumentation for siRNA synthesis, etc;
• $13 million capital investment in equipment, laboratory technology and supplies (siRNA reagents for animal and human studies; chemicals for nanoparticle synthesis and preparations; emerging laboratory technologies; computing and informatics); and
• $1.5 million in annual operating support for the high end technology programs supporting this effort to develop our science into therapeutic products (RNAi Synthesis Core: synthesis and animal work; shRNA Library Core; RNAi stability and delivery technologies)

I know that the leadership at the President’s Office and at the Medical School can work with your staff as necessary to match our needs to your budgetary processes.

Thanks again for your continuing interest in our science and your strong support for the University of Massachusetts.

Sincerely,
Craig C. Mello
Blais University Chair in Molecular Medicine

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