One June 3rd, 2010 Nature Biotechnology hosted a ‘Meet the Author’ event at the Nature Publishing Group New York City headquarters. The invited speaker was Mark Kessel, Founder and Partner at Symphony Capital, LLC. Mr. Kessel is a world expert in innovative product development, mergers and acquisitions, and has spent the last several decades advising companies and financiers. His goal during this well attended and intimate event was to summarize the challenges facing the drug discovery endeavor and analyze previous and future scenarios in order to distill important lessons which can help the industry produce continued success. Before attending, each participant had each read an interview with Mr. Kessel and other business leaders from Bioentrepreneur entitled ‘Other ways of financing your company‘ which discussed trends in early-stage biotech investment. Currently, Mr. Kessel is composing an article for Nature Biotechnology regarding challenges in the pharmaceutical sector, and the business development initiatives designed to deal with them. This report will attempt to summarize the talk given by Mr. Kessel to a group of ~20 graduate students and young professionals, and the information he shared will be incorporated into his upcoming article.

Current Problems within the Pharmaceutical Industry

In the future, business development functions will hold the key to success for large pharma, which is composed of the top 15-20 largest pharmaceutical companies worldwide. The well worn traditional model, which has focused on short term successes, is limiting new breakthroughs in R&D. The traditional model for big pharma is as follows: identify new blockbuster compounds, conduct large phase III clinical trials, and mass market approved drugs to the developed world. However, Mr. Kessel asks if this model can really address the world’s current unmet need for new drugs and continued to describe hurdles facing the industry today and in the future. With pipelines becoming depleted, development costs increasing and a timeline of 10-15 years to market, the US pharma industry is encountering strong earning constraints. Unfortunately, Wall Street evaluates companies based primarily on their short term gains and punishes them for not meeting quarterly expectations. This is in contrast to investment in China which is following a controlled and purposeful ten year plan. From 2009-2014 there will be $130b lost in sales by big pharma due to products going off patent. Companies such as Pfizer are buying other companies (i.e. Wyeth), not to replenish their pipeline, but to increase their earnings in order to satisfy investors. In fact, parts of their R&D pipeline are actually being shut down. There has been an increase in direct-to-consumer advertising, which should be examined more carefully and may be promoting products inappropriately. There is growing pressure from generic manufacturers. The FDA has been under increasing scrutiny to look more closely at safety, and the regulatory environment is becoming tougher. For example, Mr. Kessel asked the audience a rhetorical question: do you think the FDA would approve an oncology compound that has been demonstrated to extend life for several weeks, but produces horrendous side effects? The FDA is under Congressional oversight, and there are concerns about how the industry is conducting itself. Another question: If the customer is currently paying $0.10/pill, would they pay $1.00/pill next year for a drug which provides marginal benefit? Mr. Kessel suspects that patients might not be willing to pay more for incremental benefits during these times of budgetary constraints. He wonders if consumers will even be able to buy the drugs they have been paying for in the past. In an effort to demonstrate the direction in which the healthcare industry is moving, Mr. Kessel shares the example of HUMANA. This is an example of an insurance provider and payer, which is currently collaborating with another company BG Medicines to discover and implement biomarkers for patients. One of the overarching problems with non-personalized medicine is that drugs will often benefit only a minority of patients afflicted with an illness. It would be ideal to target those who will respond to therapy and identify them with biomarkers, and avoid dosing patients who will be non-responders. Insurance companies are  willing to pay for the test, and patients who don’t carry the markers will not get the drugs, increasing efficiency while reducing side effects and costs.

Mr. Kessel foresees a convergence of the FDA and EMA (European Medicines Agency), with a greater focus on safety which will slow down the approval process. All drugs have a safety/toxicity trade off. In the US, we are looking for perfect safety. However, in some fields, we have deemed side effects acceptable, such as oncology. The future will show an increased focus on longevity. However, big pharma is not prepared to capture new innovation, due to their corporate structure and administrative weaknesses. Their strength lies in their ability to recognize and capture external breakthroughs. There is a need to bolster drug discovery. Cutting costs to maintain earnings is not the panacea. The use of outdated business models and flip-flopping strategies i.e. diversifying pipelines/focusing on core competencies is showing inefficient and non-optimal strategic business development.

The Role of Biotech and Generics

Biotech is viewed as a collective of small and nimble companies capable of performing high level R&D. What’s happening in biotech? There are major capital shortages. Programs are being cut and slowed down. Small companies without a year of cash reserves are being unduly punished by the market. There were 17 bankruptcies in the biotech sector last year, which is more than Mr. Kessel had seen in any year since he began practicing law several decades ago. VC’s have moved their interest to late stage compounds. Biotech is looking to big pharma for capital. The biotech industry is trying to distinguish themselves from large pharma - they don’t want to be “tainted” and need to retain their image and ability to charge as much as possible for their products.

China, Brazil, India, and Russia are viewed as rapidly growing global markets. Consumers in those nations will be frequently purchasing from primary generics producers - Pfizer, Teva, Sanofi. They are willing to pay more for name brand generics, which have increased perceived safety assurances. They are frequently opposed to generics produced in their home country. Most new compounds in development are coming out of the US. China will soon have a robust pipeline, as well. Their is a diminishing pack of Phase III compounds to pursue, creating a very small universe for pharma. There are many in-licensing deals occurring. The number of new compounds produced has been cut in half, while the budget spent on bringing them to market has doubled. Compounds which are in-licensed should be deployed. The need to maintain earnings is the most pressing issue for management. Pharma has the cash on hand, this is not the problem. However, that cash is only generating 2% interest sitting in the bank. For example, pharma is engaging in share buyback programs and purchasing outstanding shares with cash in order to control their per share income (less shares creates more revenue per share when revenue is held constant). Shareholders expect their investment to go towards innovation, instead of buying a financial instrument.

Approaches to Addressing Cutting Edge Science

Companies are assessing the cutting edge science being produced at academic institutions. VC is focusing less on early state companies. Pharma has set up their own VC wing. Sometimes they outsource their VC arm to third parties. They are investing in companies that have new platforms. Accelerator programs, such as Lilly’s Chorus have been developed as independent divisions to carry out drug development until Phase III, independent of corporate management. These divisions are sometimes spun out as new companies. There are new partnering deals occurring, drugs are becoming pre-partnered. Other companies are even experiencing foreign take overs.

How did Big Pharma Become the Partner of Choice?

The ultimate solution would be to combine the best of biotech with the best of pharma. Biotech has the entrepreneurial spirit, which can move fast and make quick decisions. Pharma has a global sales force in place, are experts with large clinical trials, regulatory affairs and has cash on hand. Pfizer has attempted a hybrid approach by creating a unique business development unit for each of its therapeutic areas, independent of each other. However, to change big pharma there needs to be a mandate from the top which awards risk taking. These companies are not taking on great compounds in order to avoid risk. Mr. Kessel suggests a change in compensation which allows leaders to shed their “risk avoidance” behavior. He mentions that “no one has ever been fired for not taking on a great compound”, but one can sure be fired for not getting their compound to pass FDA approval. Management consultants, such as McKinsey could be used to help change the corporate culture, though this often takes 5-10 years. There needs to be a creative approach to deal making which helps support innovation on the drug development side. The one size fits all approach needs to be dismissed, and the industry needs to consider new areas of opportunity. For example, the healthcare IT industry is developing databases on how patients respond to various compounds based on previous clinical trials. This could be used in the future to predict the human response to new drugs and streamline the regulatory pathway.

Final Comments

Biotech traditionally suffers from poor management, in that they don’t abandon their failing compounds early enough. Many opportunities still remain for large in-licensing deals (20-90 deals next year). Biosimilars will play an important role, though there will be less of them with more focus on generics. In the future, diversification will be key. Productivity will get worse and we will look to biotech for compounds. The Novartis Model will become more common, as big pharma purchases branded generics, consolidates, and acquires.

]]> http://matthewaengel.com/blog/meet-the-author-mark-kessel/feed/ http://matthewaengel.com/blog/2010-nagps-northeast-regional-conference-pittsbugh-pa/ http://matthewaengel.com/blog/2010-nagps-northeast-regional-conference-pittsbugh-pa/#comments Fri, 04 Jun 2010 05:51:26 +0000 Matt http://matthewaengel.com/blog/?p=1837

This year the 2010 National Association for Graduate-Professional Students (NAGPS) held their Northeast Regional Conference in the beautiful city of Pittsburgh, PA. NAGPS is non-profit, student run organization which functions to represent graduate student interests on a national platform. The NAGPS mission is develop a graduate-professional student network, provide useful resources to grad students, and advocate at the national level on their behalf. This year I was elected to chair of the Employment Concerns Committee at the national conference in Lincoln, NE. I am chairing the Employment Concerns Committee which is carrying out several surveys this year to better understand graduate student stipends, benefits, and career development.

University of Pittsburgh - Tower of Knowledge

At this regional conference in Pittsburgh, we had two days of seminars, talks, and brain storming sessions co-hosted by the University of Pittsburgh and Carnegie Mellon. My trip was sponsored by the Stony Brook University Graduate Student Organization and the Graduate School. Friday afternoon and evening events were help on the UPitt main campus and included a talk by comic artist and author of PhD Comics, Jorge Cham, which unfortunately I couldn’t attend. Saturday’s sessions were held on the Carnegie Mellon campus, and the weather was totally amazing. Their campus has some really nice spots, and I would highly recommend visiting it. UPitt was essentially situated directly in the center of Pittsburgh and integrated into the city itself. There were hundreds of college students walking around, as it was the last day of classes, and lounging in the grass until a brief thundershower came and chased everyone away. I left Pittsburgh back for NY on Sunday afternoon and has just enough time to see the Phipp’s Conservatory and Botanical Gardens. Saturday night featured a wine tasting co-sponsored by both university’s graduate student associations held at the Pittsburgh Zoo & Aquarium.

Rich Fitzgerald - Allegheny County Council President delivering talk at Sunday morning “Pancakes and Politics” at U of Pitt.

Sunday morning, we were privy to a special session of “Pancakes and Politics” organized by Daniel Jimenez, President of the U of Pitt Graduate Student Association. The invited speaker was Rich Fitzgerald, President of the Allegheny Town Council. Rick spoke primarily to the benefits of natural gas extraction in the Allegheny County region around Pittsburgh, and how revenue derived from this process could be used to lower property taxes. He fielded many questions from students regarding the application of alternative energy technologies in lieu of natural gas, which he was not supportive of. Afterwords, I was able to speak with him on the side about some of the issues surrounding wind power and sustainable energy generation, which he kindly listened to. Daniel Jimenez ran for a local position for the Democratic Party in Pittsburgh this year, which was great experience. He is well known for leading the charge against the Pittsburgh “Tuition Tax”.

University of Pittsburgh Student Union

Besides all this sightseeing (I have a few more pictures to share also), we actually did cover alot of ground and do alot of work. I delivered one presentation and lead another brainstorming session. The first presentation covered recent developments and lobbying efforts of Stony Brook University staff and students regarding the proposed New York State Public Higher Education and Investment Act - PHEEIA (Governor Patterson’s Press Release). The brainstorming session I lead was on the two projects we have in development in the Employment Concerns Committee, and we focused on the first project which is nearing launch. It is a nationwide survey to determine best practices at University Career Centers.

NAGPS Employment Concerns Committee - Career Center Analysis and Survey

The conference itself was a huge success with attendees from over a dozen schools featuring many new member institutions. If you have any questions about NAGPS or would like to know more about the Employment Concerns Career Center Survey you can contact me at ecc@nagps.org.

Finally, may favorite pictures were taken on the last day at the Phipp’s Conservatory. I will end this post with some of my pictures taken hastily on Sunday morning. I was able to fit in a visit to these botanical gardens after I checked out of my hotel, but before my flight. Talk about efficiency! Enjoy!

Orchids

Plantings

The Hobbits

The Sun Room

The Cloister Garden

Phipp’s Conservatory during thunderstorm

I had the most amazing experience at Phipp’s Botanical Gardens. While I was walking there, I noticed the skies were clouding and thought to myself that thunderstorms could be brewing. In that case, I would be caught without my umbrella or rain coat since everything was packed and at the hotel. I pressed ahead anyway, and while inside the stunning glass greenhouses, it began to pour. I real torrential rain and thunderstorm! It was quite an experience walking through a greenhouse during a thunderstorm. The winds picked up and began gushing a cool breeze throughout the previously warm and humid terrariums. Rain started coming inside though the various pores in the ceiling. It was an amazing experience that will never be duplicated for me. I was lucky enough to call the hotel shuttle who picked me up and got me to the airport safe and sound! For free! thank you Holiday Inn of Pittsburgh - Five Stars!

We’ve all had our fair share of travel experience. But how many of us can claim they know how to haggle in an Egyptian street market? How about getting the cheapest flights around or picking the right gear? The site http://www.nomadicmatt.com/ is a great source for those who want to take a quick peek at some of the options out there. Even for the veteran frequent flyer, there is always something new to learn and besides, the travel blog is a great outlet for creativity! This reminds me, I need to update my own site and include some of my own recent adventures up here. Enjoy!

Bruce Engel, Maestro

]]> http://matthewaengel.com/blog/sbu-wind-ensemble-2010/feed/ http://matthewaengel.com/blog/life-after-stonybrook-finding-your-career-path/ http://matthewaengel.com/blog/life-after-stonybrook-finding-your-career-path/#comments Tue, 23 Mar 2010 16:35:12 +0000 Matt http://matthewaengel.com/blog/?p=1787 Taking Your Career Path Beyond the Zebra Path

Well, I have been extremely tardy in updating my blog. For that, I apologize. In fact, I am so late, I am posting an advertisement for an event which already happened. However, from the post I think you will still be able to read about the event and learn about the speakers, who were extremely interesting. It was a complete success - we had good attendance, the speakers gained invaluable experience, and the audience, including myself, learned alot about the career paths of these two unique Stony Brook University alumni. The talk was organized by the HERA Group at Stony Brook University. The University Career Center helped us advertise on their website, as well. Below, I’ve included the speaker’s bios and will just give a few points of advice the speakers gave out. Adam DeRosa suggested that if you are doing a PhD to find a young advisor who is trying to publish as much as possible. Luke Suroweic suggested hitting as many networking events as possible with your suit on, business cards and resume out - that is how he got his first internship. And the rest is history!

Free Coffee and Snacks!

Supported by the Career Center and GSO

View the PDF

Westri Stalder, Tom DiNapoli and Matthew Engel

]]> http://matthewaengel.com/blog/tom_dinapoli_meeting/feed/ http://matthewaengel.com/blog/stony-brooklyn-presents-the-spinto-band-small-black-west-dakota/ http://matthewaengel.com/blog/stony-brooklyn-presents-the-spinto-band-small-black-west-dakota/#comments Wed, 03 Feb 2010 19:13:15 +0000 Matt http://matthewaengel.com/blog/?p=1760 Bringing the Best of Brooklyn’s Independent Music Scene to Stony Brook University

21 and over

Free and Open to the Public

Doors Open: 8:30 PM

West Dakota (www.myspace.com/westdakotayeah) – 9 PM

Small Black (www.myspace.com/smallblacksounds) – 10 PM

Spinto Band (www.myspace.com/thespintoband) – 11 PM

Location: University Cafe, Stony Brook University

In early September 2009, I was privileged to attend an information session at Brookhaven National Laboratory (BNL)  regarding the proposed 32 MegaWatt (MW) solar power plant to be installed on site. The presentation was given my Timothy M. Green, Natural Resource Manager of the Environmental Protection Division and consisted of an overview of the BP (British Petroleum) Solar Project. The plan is to build the largest solar power plant ever in NY on Long Island, and would involve collaboration with the Long Island Power Authority (LIPA), BNL, and BP while following Governor Patterson’s 45 by 15 plan.  The Governor’s policy calls for 45% of NY State’s energy to be generated by renewable sources and improved energy efficiency. This is a great shift forward, if in fact it can be implemented.

Solar Electric Generation Facility Competes with Oil-Fired Power Plants

Patterson’s call to create this solar power plant as part of his 45 by 15 plan is an excellent moderate goal for several reasons, but a poorer long term goal. This is a positive short term goal because the construction of a solar power plant in the tri-state area will serve to demonstrate feasibility of solar power generation on a large scale to New Yorkers, educate consumers about the capabilities of this technology, provide a testing ground for BNL photovoltaic researchers, and raise awareness about solar energy to the general public. Also, it is extremely important to note that this plant will be operated, managed and connected to the grid by LIPA - a non-profit NY State electric utility company. They are responsible for distributing electricity to all Long Island residents, though LIPA does not currently own any electric generation assets. LIPA functions by outsourcing distribution and transmission line maintenance to NationalGrid. The construction of this new plant is different from the current model, in which the oil-fired power plants in this region are operated and managed solely by National Grid without a single other power company existing in the region to compete and drive down prices. Therefore, the solar power electric generation facility which will not be owned by National Grid represents the first source of competition for electric utilities in this region.

Weakness of Large Scale Solar Power Plants Compared to Small, Locally Owned Solar Powered Electric Generation Facilities

However, the weakness in creating large scale solar power plants for electricity production for individual and commercial usage is that it is unsustainable. In the future, if we were to build enough new solar power production plants to sustain the Long Island region we would require much more land than is available for new development (data forthing). The alternative solution is too construct individual ‘power plants’ at the end user’s location by installing photovoltaic (PV) arrays at the actual site of energy consumption - another words, install solar panels at home or work. This would (1) marginalize the environmental impact and reduce development costs by eliminating the need to tear down trees and build plants on empty land; and (2) increase efficiency and reduce costs by eliminating electricity lost during long-distance transmission from the power plant to the consumer.

Environmental Impact and Research Component

In September of ‘09, it was announced that this facility would be producing 50MW. In the last 4 months, the total power output has been reduced roughly 30% to 35MW, which takes a significant amount of benefit out of the proposed advantages of this project. Upon questioning, the representatives of this project stated that one major advantage of this plant over smaller, locally owned PV systems would be savings due to the “economies of scale”. A 30% reduction in power output and probably panel construction lowers this benefit. During the meeting with LIPA and BNL representatives it was states that LIPA wanted “to provide more green energy to [their] customers”. They solicited a proposal for large scale power plant construction and received many offers. The audience at this talk received some information on the technical specifications of this operation as well as alot of ‘greenwashing’. Greenwashing is the act of stating rhetoric in order to improve public image. However, in this case, the greenwashing is being backed by significant action so some rhetoric is in order, such as “we must diversify our energy resources to increase security”. No offense, but adding 32MW to the grid is not going to do much to reduce dependence on foreign oil. It is really just a first step.

The plant will cost $220m and the panels will be manufactured by BP in the USA. BP is seeking a ROI over 20yr, the length of its contract with DOE. The panels will be standard crystalline PV modules and will take up 200 acres. Total acreage of the lab is 5,625 acres. By optimizing space, the laboratory was able to reduce the standard 8-10 acres/MW to 5 acres/MW. This will be achieved by closely packing the panels with 18.5ft of spacing apart to gain maximum efficiency without causing loss due to shadowing. Construction would occur right in the middle of the lab. The arrays would be interdispersed with smaller step-up transformers (converting DC->AC power) sprinkled throughout the plant. A final step-up facility will be used to bring the voltage to 69kV in order to be compatible with voltage already along the grid. The electricity produced would not be for the lab and the Department of Energy will continue to own the land. If approved, construction will begin in Spring 2010 and go online May 2011. While the facility would create jobs by requiring 200 people for construction, it will only require 2 people to manage the plant. There are no moving parts.

Research and Commercial PV Array Specifications and Location

Approximately 10 acres of this plant will be dedicated towards a research array which would produce 1-2MW of power for the lab. These panels will be used to study battery storage systems, the effects of local climate on PV modules, and how fluctuations in the grid impact output. The 37MW plant should be capable of producing 40m kWhrs/yr. These panels are projected to last up to 40 years, It will require 500,000 gallons of water/yr just to wash the panels.

Other locations on the BNL site were considered. A dispersed system along roadways was ruled out since it would be difficult and inefficient to connect these panels. The goal is to direct energy from the PV arrays to the LIPA substation - and a disparate chain of panels would require more voltage and pipeline to link the arrays. During peaks hours LIPA will be able to reduce the load of its current grid and avoid 1.2m metric tonnes of carbon dioxide. For reference, 2000 acres of 75 yr old trees sequester 2.2 thousand cubic tonnes of carbin dioxide. I did not realize that trees sequester most of their carbon while growing - a good excuse to plant more!

Summary and Conclusions

In summary, this is an inspirational and practical project that I believe will seriously benefit the regional economy and environment. However, I still fail to understand why the 200 acres of PV arrays were not built on rooftops. Considering the average house uses 5,256 Kw-hours/year then this 40million kW plant should be capable of powering ~7,160 homes. If each home takes up 0.5 acres then we would have ~3,600 acres available to build panels. Therefore the 7,160 homes which are being powered by this lone plant could potentially produce much more power combined if they were equipped with their own PV systems. Some further calculations - assuming each home is 0.5 acres, but only has 0.25 acres os usable area for panels then this reduce our total acreage available to 1,800 acres. Assuming BNL’s factor of 5 acres/MW then 7,160 homes could be capable of producing 360 MW. This is 10x the power of the current plant. Therefore, the government should seriously consider investing in PV systems for the individual homeowner, rather than municipal utilities in order to account for increased efficiencies.

Additional Information

How Many Solar Panels Do I Need to Power my House?
New Project Developments
BP Long Island Solar Farm - Environmental Review
enXco Eastern Long Island Solar Project - 17MW of Solar Energy to be constructed on Suffolk county Public Land

By now, most of us who use the internet daily have had some interaction with cloud computing. Cloud computing allows users to write documents, create presentations, spreadsheets or store data on a virtual server accessible via the web. The most well known example is Google Docs which allows users to create and collaborate on articles in real time, online. This way, you and I could be working on the same document simultaneously without having to email it back and forth. It allows for many users to be working on the same project at any one instant and automatically backs up the most updated version. It also allows you to store an almost limitless number of documents on the internet for free, thereby allowing one access to files from any computer in the world at any time, without having to lug around the data yourself. This is a tremendous convenience at no cost (for now).

I have been using Google Docs for several years, and it has never inspired me to write a blog post. However, most recently I encountered a new piece of software/service which I found so convenient and useful, that I am rushing to spread the word. I would highly recommend making an account with the service Dropbox which gives you 2GB of webspace for free. So what’s the big deal you say? Dropbox features one of the most user friendly drag-and-drop interfaces I have ever seen. It allows you to toss files directly up onto the cloud from any computer - that has the dropbox application installed. And then download them from any computer. The only drawback of this process is that it requires you to download and install a program on each machine, however it is lightweight, relatively non-intrusive and worth the convenience of being able to store large quantities of files on the fly. What’s really cool, and a great marketing strategy, is that you gain additional storage space when you successfully invite users to sign up for the service.

Dropbox Wiki

When I discovered the service, I was curious as to how they make money. What is their business model? How does a company which provides services for free make any profit? I believe this is a common catch-22 on the web. Everyone wants information, services, and conveniences for free and we are so used to this almost no one is willing to pay for web content or storage space. Dropbox offers additional storage options beyond the 2GB for a fee - 50GB for $9.99/mo or 100GB for $19.99/mo. I questioned why anyone would pay for this or keep that much data on the web? The answer I got from a friend, was that once customers become accustomed to the conveniences of keeping their files on the web, they may eventually reached their storage limit and decide to splurge for an upgraded their account. I am curious how many paying vs. non-paying custiomers Dropbox has and how they plan to increase their paying user base.

On November 17, 2009 I was privileged to play first trumpet with the Stony Brook University Wind Ensemble, under the direction of Maestro Bruce Engel. I actually had a small solo in Phantom of the Opera, by Andrew Lloyd Webber - since it was the last piece of the program I was nearly exhausted by then. You can see the advertisement we distributed above, which came out beautifully. We are very lucky to have some dedicated community members who give their time to design and print these flyers for us. During the performance on the Staller Center Main Stage, the musicians (myself included!) get to wear a tuxedo on stage with bow ties while we are playing. I’ve been in this ensemble for over a decade now, and I always love it. Below I am putting a few videos taken of our performance, including one from ‘Harlem by Night’ by David Bennett with a terrific trumpet solo, and other of Phantom of the Opera. Enjoy!

On Oct. 25, 2009 the Fundamentals of the Bioscience Program Alumni Organization launched its official alumni website: fobip.org/alumni. The Fundamentals of the Bioscience Industry Program is a semester long collaborative course covering information critical for students to prevail in the biotechnology, pharmaceutical, and business worlds. Graduate students are able to hear and watch seasoned professionals from both start-up and established companies describe their career paths and discuss their business models. The program has an excellent reputation for producing bright, motivated students who have been extremely successful in their careers.

The target audience for the alumni website is professionals working in the biotech and pharma industries. I wanted to create a resource that would feature useful articles from alumni and guest authors with experience relevant to program graduates. One of my goals was to put a spotlight on the alumni and draw attention to the high caliber of its course instructors, graduates, and applicants. We hope to feature articles covering the the financial industry, venture capital, intellectual property, technology transfer, recruiting, and academia in relation to biotechnology. We want to provide information that will be useful to the start-up entrepreneur, industry veteran, and job seeker. Without any advertising we have had already 1,000’s of page views and hundreds of unique visitors. I am hoping that the content we generate will be a useful resource and we are aiming to add interviews and new articles approximately every 2 weeks.

I dreamed up this concept in early Summer 2009 and discussed it with Kate Posnanski, Manager of Programs at the Center for Biotechnology. With the help of many program alumni such as Jenne Relucio and Banke Fagbemi, we were able to bring the project to fruition and launch the website this Fall. I decided to use my experience creating websites use Wordpress to generate the blog format with some additional features. We have an alumni page we are trying to build on every day featuring over a dozen of our graduates.

On the techie side, I used Wordpress as my publishing platform with the Red Evo News Blue theme from Red Evolution installed. This theme evens offers a modest support forum which was able to answer some of my questions about theme customizations about controlling the length of the except. The except is the text displayed on the homepage describing the content of an article in brief. Also, I took advantage of using custom fields for the first time. Before creating this site, custom fields were a complete mystery to me. I found this video tutorial EXTREMELY helpful, and now I use the custom field to display images on the homepage for each post. There are both thumbnail and featured image custom fields available, built into the Red Evo News Blue theme. This was also the first time I embedded a Google Calendar into a website. That part was extremely simple, and if you want to know how to do that check here.

In summary, I hope to continue building this special website, which I hold dear to my heart and hope it will bring alot of benefit to the Fundamentals Program and its graduates. Cheers!

By Mathew A. Engel

Day 1 Summary: Venture Capital Financing, Intellectual Property Management, and Emerging Business Models

The 2009 Life Science Summit took place from September 23 to 24, 2009 at the Hyatt Regency Hotel in Happauge, NY. There were hundreds of attendees representing the biotech industry and academia from all over the state. The industry attendees showed a diverse segmentation with strong representation from university technology transfer offices, law firms, venture capital firms, medicine, privately held biotech companies, mid and large-cap pharmaceutical companies. As a graduate student and alumni of the Fundamentals of the Bioscience Industry Program, I spent most of my time talking with accomplished professionals from successful companies who had experience commercializing technology, raising capital, or evaluating new ventures. Below I will summarize my findings from the most interesting sessions throughout the first day of the summit. Hopefully, in the near future I will publish a follow-up covering day 2.

What Does it Take to Build a Biotechnology Company in Today’s Environment

The opening plenary session was a great way to spark the crowd’s interest and attention. In the back of my mind, I am always thinking about starting a biotechnology company and therefore always eager to hear advice from seasoned industry veterans. These individuals, especially those who volunteer as panelists or speakers are often willing to share their knowledge and offer some deep insight to beginners. In this session the speakers focused on how to raise capital. Those who are evaluating your proposal will be thinking “where is the technology” and “where is the project”. It is suggested that you network and these connections will lead you to investors who can also guide you into small collaborations. Their role is to keep these smaller companies on track. Currently, most of the demand is for products in late stage clinical trials, in this space demand remains high. Pharma is limiting their investment to certain therapeutic areas. The days of massive deal for a new platform technology are behind us. The huge investment in genomics with no products to show for it was cited. Most deals come about because someone knew someone. It’s not just writing a business plan and patents (though that is still required!). Venture capital (VC) will only stay in for a very short time. Pharma will only jump in Phase II. VC largely invests in people they know. Mailing the best business plan in the world to VCs will get you nothing. You have to meet people some way that might invest. For example, some of the people on the panels today are Angel investors. Remember to “pick your partners”. The entrepreneur better be prepared to invest. Are there other options besides start-up? Many of the panelists, knowing what they do now, would not have chosen to start their own company. “Got to be ignorant to go do it”. Today, businesses are focusing on staying extremely lean - infrastructure is reduced. Reducing the amount of money necessary to operate. However, a company can only “be so lean” and achieve their business goals. VC is not going to be the “sugar baby” that’s going to take the company all the way through. There are drug discovery and medical chemistry labs on campus. The university should have a funding pool designated for small companies coming out of academia. One of the panelists spent time describing the experience of his friend who was trying to raise capital. His friend took no as just another opportunity to go back to him. However, it’s good to get someone with more experience and put together a team of people. “Build a culture and your company”. Medical devices is a great area to get into now. Diagnostics tools is a “neat area to be going into”. Get management in - VC looks at management team. Get help and advice from VC. Donald L. Drakeman, Venture Partner at Advent Ventures had previously ran a company and was now a VC. His motto is “management, management, management”. What makes great management? Management that will step aside.

Is the VC funding Model Broken?

Mary C. Tanner, Managing Director at Peter J. Solomon & Co. and Maggie Flanagan LeFlore, Managing Director at MedImmune Venture Inc. were two of the most outspoken panelists during this business workshop. The panel delivered an overview of the VC industry covering current trends in their investment strategies. VC’s are adaptable and clever. They are in the business of building private companies to be sold. Their goal is to reach a deal with your company, in which payments are made as milestones are met. LeFlore covered 18 deals in the last year. Private companies are easier to sell. Fewer and fewer big pharma are in the market for these investments. Their has been a fundamentals shift in exit strategy. Survival has followed those most adaptable to change. There are many exit strategies. How to get the VCs interest? Early stage risk is notorious, your goal should be to find little pockets of money to move things forward. Your faculty members better be well known (i.e. published in Nature, Science, Cell..). One of the panelists, E. Jonathan Soderstrom, Managing Director of the Office of Cooperative Research at Yale University had brought a compound to the attention of Lily. They asked for a proof of concept in humans! He did not even have that in animals. The message is that you cannot expect Lily or Genetech to fund your development costs when the product is highly experimental.

National Resource Defense Council Loses Legal Battle Against US Government

The National Resource Defense Council, local state environmental advocacy groups and Native American tribes have been protesting the construction of a new $12 billion pipeline which stands to stretch from Alberta, Canada to Wisconsin, US. On August 20th, the U.S. State Department approved permits for Enbridge Energy to begin construction. The pipeline will allow for 450,000 barrels of heavy crude to be pumped from tar sands in Canada, transported, ultimately to be refined in Wisconsin, as reported by the Associated Press. Tar sands, or oil sands, are extra heavy deposits of “unconventional crude oil” stored as bitumen deposits - a substance similar to tar, or asphalt. Bitumen contains lead, arsenic, selenium, mercury and many other toxic elements. Until recently bitumen recovery had not been considered profitable to extract due to the necessary mining process. Since this material is nearly solid, harvesting this material requires heating the tar until it is nearly boiling deep underneath the earth, and then separating out the sand and water. Some of the world’s largest tar sands reserves are in Canada, which produced 44% of its oil from this source in 2007.

Affect on US Oil Consumption

As of 2000, the US was consuming 19.6 million barrels of oil per day, one quarter of the world’s consumption at an annual rate of 7.2 billion barrels. This rate of consumption is increasing by 2% annually. It is estimated that Canada contains roughly 1.7 trillion barrels of tar sands oil, and at the aforementioned rate, is enough to last the US 237 years. However, it should be noted the cost of extracting the resource is very high - both financially and environmentally. This type of oil, referred to as unconventional oil requires surface mining or other in situ techniques that require massive amount of water and energy. Therefore, the economic benefit of mining this unconventional oil source was non-existent with the relatively cheap cost of fuel until 2005. The chart below illustrates the price of light crude oil on the NYMEX from 2001 through 2009.

Here we can see that crude oil peaked at over $140/barrel in early 2008. Economists may consider the correlation of these record high costs as a precursor to the current recession seen in the US right now. It is difficult to calculate if this was an example of correlation or causation - i.e. did the record high prices of oil spur on the recession? or did a recession cause the price of oil to collapse? This link provides historical charts tracing the price of crude oil back to 1983. The massive monetary and industrial investment in tar sands oil production and transportation infrastructure is a sign of an important trend to come in the near future - the probable increase in costs of crude oil. Since Q1 09 there is a clear rise in the cost per barrel, and this trend is likely to increase, barring unpredictable political events abroad. This commitment and investment in construction could only be worthwhile if the price of crude was expected to rebound with a dramatic increase in price. At $75/barrel, the intensive energy required for tar sands oil mining is not economically profitable. The NRDC case described above was dismissed by a federal judge on procedural grounds, claiming the NRDC lacked the proper authority to challenge the pipeline’s environmental impact permit.

Future of alternative energy at stake

With all the government pledges and political talk about alternative energy investment, technology development, and job creation, the presidential approval of this project to go forward was a massive disappointment. Economists and environmentalists alike agree that the current long-term strategy of investing in oil production is a major step in the wrong direction (see Thomas Friedman Hot, Flat and Crowded). Sierra Club Executive Director Carl Pope says ”This project will lock our nation into a dirty energy infrastructure for decades to come”. “Instead of increasing our reliance on oil and piping in pollution, the State Department should support clean, American energy and the jobs that come with it.” The decision by the federal government to allow this construction and old polluting technology infrastructure to go in place is a significant blow to the alternative energy industry. Instead of supporting the research, development, and commercialization of alternative energy technologies i.e. cleantech, the federal government is tacitly approving the influx of billions of barrels of oil, the carbon monoxide that is produced as a biproduct and released into the atmosphere, not to mention the destruction of the natural environment from which this tar sands oil came from. From an economic standpoint, this project will produce jobs in the short term, but threaten a nancesent industry from burgeoning in the long term which ahs the opportunity to transform our country and our world. This project will cost American jobs that could have been created in the high-technology industry which sustains long term financial growth, opposed to short term construction projects that do not add to any new industry.

Essentially, this is a major victory for big oil sanctioned by our own government which is acting as a mouth piece for the clean energy industry while doing literally nothing to practically support it. The rise of cleantech is not an if, but when. If it not now, it will be in the future when petroleum resources are no longer economically or politically viable or people realize that burning oil for fuel is not sustainable. And if America is not a leader in this innovation, surely China and India will step up to the plate.

In July 2009, I passed a major milestone in my graduate research in the Department of Biomedical Engineering at Stony Brook University - I passed my qualifying exam! This literally required hundreds and hundreds of hours of work, during which I read over 50 scientific publications and synthesized them to come up with an original grant proposal. In this case, my challenge was to use a tissue engineering approach to treat degenerative disc disorder. Below, I will place my statement of interest plus a copy of the grant proposal and presentation I made. I most definitely learned a tremendous amount from this process, most of which I will be keeping private and storing away for later use. But it really teaches you how to make an effective presentation and to prepare thoroughly for a talk.

In a nutshell, the project focuses on stem cell implantation technology to treat spinal chord injuries associated with aging, and could also be applied to acute injuries.

Click on individual slides to see the full image

PROJECT SUMMARY: This proposal aims to design an in situ curable hydrogel composed of PNIPAAm-PEG capable of delivering therapeutic cells and drugs to the degenerated nucleus pulposus (NP) of an intervertebral disc (IVD). The therapeutic cells will be human mesenchymal stem cells (hMSCs) differentiated into NP-like cells by exposure to hypoxic low oxygen conditions in the presence of transforming growth factor β1 (TGF- β1). The hydrogel is composed of a solution containing 10% PNIPAAm-PEG(8000) at a 1:1600 ratio of PNIPAAm:PEG which undergoes a sol-gel transition at physiological temperatures (32°C). Modifications to the PEG molecular weight or concentration can be used to alter the hydrogel stiffness or sol-gel transition temperature. These properties will allow users to prepare cell and drug loaded solutions at ambient temperatures and then inject them into the degenerated disc, at which point they solidify in situ. The hydrogel is capable of being blended with small molecule inhibitors of nitric oxide synthase (NOS). The inhibition of NOS has been shown to increase proteoglycan content which can restore disc height to the degenerated IVD.

Download copy of grant proposal here (.pdf)

It has been some time since I wrote a post on here, and it is for a good reason. A lot of great and interesting things have been happening, and I still plan on sharing them. I have to say the one thing about writing a blo, and that is the longer you wait to post something, the tougher it becomes. I have alot of great ideas floating around my head, and several of them already have legs. I often see or hear something in the news and think “Gee. That would be really great to write about on my website”. Alas, it hasn’t been happening as frequently as I would like. However, the topics I have in the pipeline are going to grab your attention and capture the current trends in energy, technology, and financial investments in these fields. They include a report on biofuel start up companies, the mass production and marketing of electric vehicles, a new 37 Megawatt solar panel plant being built at Brookhaven National Laboratory, the launch of a new website I have created and a note on my passing of the Ph.D. qualifying exam in biomedical engineering at Stony Brook University. This is alot of stuff to write about! For now, I just wanted to mention that I’ve linked this blog with my LinkedIn profile using their Wordpress application. To see this, you have to be signed into LinkedIn and able to view my full profile. Check it out, it’s really neat! I’m wondering if it’s possible to link multiple blogs there, since I actually manage almost half a dozen websites by this point. Hope to keep you posted and have a great week!