Pharma-Biotech Startup Ecosystem Apr 2013

7/28/2019 Pharma-Biotech Startup Ecosystem Apr 2013

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TABLEOFCONTENTS

ExecutiveSummary,3

Introduction,4

Stakeholders,5AcademicResearchInstitutions,6

IncubatorsandTechnologyParks,7

StartupandLongerTermFunding,7

StartupPharma/BiotechCompanies,8

BioscienceNetworkingGroups,9

TradeOrganizations,10

ScientificandTechnicalExpertCommunity,10

ContractResearchOrganizations,11

EstablishedPharmaceuticalandBiotechnologyCompanies,12

StateandLocalGovernments,13RequirementsforaSuccessfulIntegratedStartupEcosystem,14

ElementsofaRegionalLifeSciencesEcosystem,14

InitialAssessmentofStrengths,Weaknesses,OpportunitiesandThreats15

FromIdeastoProducts:AComplexandHigh-RiskProcess,16

PathForward,17

ProposedNextSteps,17

Acknowledgements,18

AbouttheAuthor,19

_________________________

Copyright2010,2013byThorirD.Bjornsson


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EXECUTIVESUMMARY

TheGreaterPhiladelphiaregionhasbeenhometomanylarge,well-knownandsuccessful

pharmaceuticalcompanies,andsomeofthelargestglobalpharmaceuticalcompanies

haveR&Dfacilitiesinthearea.However,theregionhasnotenjoyedproportionate

successinthepharma/biotech1startupandsmallbusinessarena.Theobjectivesofthis

paperaretocollectkeyrelevantinformationaboutregionalactivities;toidentifykey

stakeholders;toassesskeyrelevantstrengthsandweaknesses;andtodevelopanoutline

ofnextstepstofurtheradvanceavibrantandinnovativepharma/biotechstartupand

smallbusinesshub.

Tenstakeholderclustersareidentifiedanddiscussed,involvingAcademicResearch

Institutions;IncubatorsandTechnologyParks;StartupandLongerTermFunding;Startup

BioscienceCompanies;BioscienceNetworkingGroups;TradeOrganizations;Scientificand

TechnicalExpertCommunity;ContractResearchOrganizations;Established

PharmaceuticalandBiotechnologyCompanies;andStateandLocalGovernments.Abriefdescriptionisprovidedforeachclusterandarepresentativelistofmembersisprovided

foreachcluster.Suchclusteringofstakeholderswillservetobetterenableexplorationof

anintegratedregionallifesciencesecosystemdesign.

Anassessmentoftherelevantstrengths,weaknesses,opportunitiesandthreatsrevealed

keystrengthsasbeingoutstandingacademicresearchinstitutions;thepresenceofmany

largepharmaceuticalandbiotechnologycompanies;largehighlyeducatedand

experiencedworkforce;andseveralincubatorfacilities.Keyweaknesses,however,

includedthecurrentlowstandingoftheregioninthepharma/biotechstartupandsmall

businessarena;lackofaunifiedvoiceandpresence;limitedinteractionsand

communicationamongstthedifferentstakeholders;andlimitedstartupandventure

capitalfunding.Anoutlineofproposednextstepstoadvanceasuccessful,integrated,

creative,vibrantandgrowingpharma/biotechecosystemforGreaterPhiladelphiais

provided.

TheGreaterPhiladelphiaregionhasverysignificantstrengths,whichwhenleveragedina

coordinatedandintegratedmanner,coupledwithacomprehensiveteamworkinvolving

allstakeholders,promisetoenabletheregiontobecomealeaderinthepharma/biotech

startupandsmallbusinessarena,aplacewhereitneedstobeanddeservestobe.

1Notethatthispaperusesthetermspharma/biotech,biosciences,andlifesciencessomewhat

interchangeably,generallyreferringtosmallmolecules,biopharmaceuticals,diagnostics,devicesand

imaging.


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INTRODUCTION

TheGreaterPhiladelphia2regionhasbeenhometomanylarge,well-knownand

successfulpharmaceuticalcompanies,andsomeofthelargestglobalpharmaceutical

companieshaveR&Dfacilitiesinthearea.Infact,thelifesciencessectorhasbeen

responsibleforcreatingoneoutofeverysixjobsintheregionandgenerates15percentofalleconomicactivity.TheMilkenInstituteReportonTheGreaterPhiladelphiaLife

SciencesCluster2009rankedtheregionin2ndplacenationallyintheoverallcomposite

score,butrankeditin9thplaceinthesmallbusinessvitalityindex.Clearly,thepresenceof

thebigpharmaceuticalcompaniesintheareaishavingamajorpositiveeconomicimpact,

buttheregiondoesnotappeartobeenjoyingproportionatesuccessinthestartuparena.

Overthelastonetotwodecadesthepharmaceuticalindustryhasbeenexperiencing

increasinglysignificantchallenges.Theseinclude:inconsistentproductivitybasedonthe

numberofannualNDA/BLAapprovalsbytheFDA;increasingR&Dexpenditures;

increasingpatent/exclusivityexpirations;erodingrevenuesofmarketeddrugsduetogenericlaunches;increasingpercentageoftotalprescriptionsfromgenerics;andnotthe

leastattrition:ofallcompoundsenteringdevelopmentbetween90%and95%fail.This

hasledtoanincreasinginterestbythelargepharmaceuticalcompaniesinsecuring

innovativeproductsdiscoveredanddevelopedbysmallpharma/biotechcompaniesto

complementtheirownpipelines,andinpartneringwithacademicresearchinstitutions.

Thekeyobjectivesofthispaperon"APharma/BiotechStartupEcosystemforGreater

Philadelphia"areasfollows:

1. Tocollectkeyrelevantinformationaboutwhatsgoingonintheregioninthesmallpharma/biotechbusinessspace.Whilethereisnosinglesourceorwebsiteprovidinganall-inclusiveoverviewofthelifesciencesbusinessesintheregion,thetwomost

informativewebsitesarethoseofSelectGreaterPhiladelphiaandPennsylvaniaBIO.

2. Toidentifythekeyentitiesandstakeholdersinvolvedinthepharma/biotechstartupactivitiesintheregion,andhowthesecanbegroupedtogethertobetterunderstand

howtheymightbeoptimallyintegratedtoformavibrantandgrowingecosystem.This

willbefollowedbyanassessmentofkeystrengths,weaknesses,opportunitiesand

threats.

3. Todevelopanoutlineofproposednextstepstoenhancetheregionspresenceandcapabilitiesinthegeneralpharma/biotechstartupandsmallbusinessarena.

Aswasindicatedabove,theGreaterPhiladelphiaregionhaswaystogofromwhereitis

today,andthechallengesandimplicationsfortheregionaremorelikelytoincreasethan

decreaseinthecomingyears,unlessthereisanactiveintervention.

2TheGreaterPhiladelphiaregionconsistsof5countiesinPennsylvania(Philadelphia,Bucks,Montgomery,

DelawareandChester),5countiesinNewJersey(Mercer,Burlington,Camden,GloucesterandSalem)and1

countyinDelaware(NewCastle).


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STAKEHOLDERS

Astakeholderisdefinedasaperson,group,ororganizationthathasdirectorindirect

stakeinanorganizationbecauseitcanaffectorbeaffectedbytheorganization'sactions,

objectives,andpolicies.3Thus,alistingofallrelevantstakeholdersinAPharma/Biotech

StartupEcosystemforGreaterPhiladelphiacouldbeverylongindeed;however,keystakeholderscanbemeaningfullygroupedintotenclusters,asisdepictedinFigure1.One

couldarguethatthereshouldbemoreclusters,orfewer,eventhattheseshouldbe

nameddifferently.Forthepurposesofthispaper,however,webelievethesetenclusters

serveasagoodfoundation.

Figure1.ClustersofStakeholdersinaPharma/BiotechStartup

EcosystemforGreaterPhiladelphia.

Abriefdescriptionwillbeprovidedforeachclusterandwhatmembersarerepresentedin

thatcluster.Notethatthelistofmembersinagivenclusterisnotintendedtobe

exhaustiveorcomplete;rather,itisintendedtoprovideameaningfulrepresentativelist

toenableexplorationofaregionallifesciencesecosystemdesign.Manyofthecluster

memberswillhaveahyperlinktotheirwebsiteprovidingdetailedinformation.

3BusinessDirectory,2007

ACADEMIC'

RESEARCH'

INSTITUTIONS

STARTUP'&'

LONGER3TERM

FUNDING'

INCUBATORS'&

TECHNOLOGY'

PARKS

SCIENTIFIC'&'

TECHNICAL'

COMMUNITY

CONTRACT'

RESEARCH'

ORGANIZATIONS

STATE'&

'LOCAL'

GOVERNMENTS'

STARTUP'

BIOSCIENCE'

COMPANIES

TRADE'

ASSOCIATIONS

PHARMA/

BIOTECH'

COMPANIES

BIOSCIENCE

NETWORKING'

GROUPS


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AcademicResearchInstitutions

Philadelphiahassomeoftheoldestuniversities,medicalschools,pharmacyschools,

medicalresearchinstitutes,andhospitalsinthecountry:UniversityofPennsylvania,oneof

thefirstuniversitiesinthenation(foundedin1740),itsSchoolofMedicine,thenations

firstmedicalschool(foundedin1765);PennsylvaniaHospital,thenationsfirsthospital(foundedin1751);JeffersonMedicalCollege(foundedin1824,nowpartofThomas

JeffersonUniversity);UniversityoftheSciencesinPhiladelphia,thefirstschoolofpharmacy

inthenation(foundedin1821asPhiladelphiaCollegeofPharmacy);DrexelUniversity

CollegeofMedicine(formedfromHahnemannMedicalCollegeandWomansMedical

CollegeofPennsylvania,establishedin1848and1850,respectively);TempleUniversity

(tracesitsbeginningto1884);theChildrensHospitalofPhiladelphia,thenationsfirst

childrenshospital(foundedin1855);theWistarInstitute,thefirstindependentmedical

researchinstitute(foundedin1892);andtheFoxChaseCancerCenter,thenationsfirst

cancerhospital(foundedin1904).NewJerseyishometotheprestigiousPrinceton

University,oneofthetoprankeduniversitiesintheworld(foundedin1746astheCollegeofNewJersey;renamedin1896),andDelawareishometotheUniversityofDelaware,one

ofthenationsoldestinstitutionsofhigherlearning(tracesitsrootsto1743).

UniversityofPennsylvania DrexelUniversity ThomasJeffersonUniversity TempleUniversity UniversityoftheSciencesinPhiladelphia PrincetonUniversity UniversityofDelaware ChildrensHospitalofPhiladelphia FoxChaseCancerCenter WistarInstitute

Theseandotheracademicandmedicalresearchinstitutionsintheregionshouldarguably

formthebackboneofavibrantpharma/biotechstartupecosystem,providingcutting-

edgeresearch,newknowledge,andfuturemanpower.Eachoftheseacademicresearch

institutionshasitsowntechnologytransferfunction,servingtheinstitutionandits

faculty;ithasbeensuggestedtheircurrentpracticesareinneedofupdating.Manyof

theseinstitutionshavecourseandseminarofferingsrelevanttodrugdiscoveryand

developmentandentrepreneurship,andcontinuingeducation.Whiletherelationshipbetweenfederalbiomedicalresearchfundingandentrepreneurialactivityisnot

straightforward,contributionsbytheregionsacademicresearchinstitutionsto

pharma/biotechstartupinitiatives,whilelimitedinthepast,appeartobeincreasing.

OPPORTUNITIES:Imagineiftheseacademicresearchinstitutionsbandedtogethertodevelop

anintegratedandcoordinatedlinktotheregionspharma/biotechstartupcommunity.


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IncubatorsandTechnologyParks

TheGreaterPhiladelphiaregionhasseveralincubatorsprovidingtemporaryfacilitiesand

supportforlifesciencesstartupsandsmallbusinessesduringtheirinitialphases.These

includetheUniversityCityScienceCenterinPhiladelphia,thenationsoldestandlargest

urbanincubator(establishedin1963);theLankenauInstituteforMedicalResearchinWynnewood(foundedin1927);PennsylvaniaBiotechnologyCenterandPennsylvania

DrugDiscoveryInstituteinDoylestown,BucksCounty;theNanotechnologyInstituteat

TheNavyYardinPhiladelphia;therecentlyestablishedUPstartProgramattheUniversity

ofPennsylvania;andtheInnovationCenterinUwchlan,ChesterCounty.InDelaware

therearetheDelawareTechnologyParkandtheDelawareBiotechnologyInstitute,New

CastleCounty;andNewJerseysCommissiononScienceandTechnologylistsseveral

incubators,somewithintheGreaterPhiladelphiaregion.

UniversityCityScienceCenter

LankenauInstituteforMedicalResearch PennsylvaniaBiotechnologyCenter PennsylvaniaDrugDiscoveryInstitute NanotechnologyInstitute UPstartatUniversityofPennsylvania InnovationCenteratEagleview DelawareTechnologyPark DelawareBiotechnologyInstitute StateofNewJerseyCommissiononScienceandTechnology

Incubatorsandtechnologyparksarecriticalforprovidingthenecessarysupportforstartupcompanies,providinglaboratoryspace,officesandsharedspace,andgeneral

administrativesupportandadvice.MostoftheincubatorsinPennsylvaniaareinKeystone

InnovationZones,whichprovideimportanttaxadvantagesforstartupentities.These

incubatorseachhavetheiruniquehistoryandmission,andtheyhavedeveloped

innovativeprogramstoaidandattractnewstartup,e.g.,theScienceCentersQED

Program,UPstartsuniqueservices,andtheNanotechnologyInstitutesNanotechnology

ApplicationFund.Theredontappeartobesignificantcollaborativeorcoordinating

effortsbetweentheregionallifesciencesincubators.

OPPORTUNITIES:Imagineiftheregionsincubatorsdevelopedjointprogramsforsharing

resources,bestpractices,andexpertise,andfortrainingoflaboratorypersonnel.

StartupandLongerTermFunding

Whileinitialfundingneedsforstartupcompaniesmayvarygreatlydependingonavariety

offactors,e.g.,stageofdevelopmentandcapitalequipmentneeds,soonerorlatermost

willrequireconsiderablecapitaltosustainthemselvesduringthefirstfewyears.


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SelectGreaterPhiladelphiaprovidesalistofinvestmentandfundingsourcesintheir

GreaterPhiladelphiaLifeSciencesGuide,includingventurecapital,angelinvestors,

commercialandinvestmentbanks,seedfunds,andstateandfederalprograms.Offederal

fundingprograms,thebetterknownincludeSmallBusinessInnovationResearch(SBIR)

grants,aswellasNIHandNSFgrants;moreinformationisprovidedbyInnovation

Partnership.TwoPennsylvaniastate-sponsoredfundsare:

BenFranklinTechnologyPartners/SEP BioAdvance

Thekeytraditionalconnectioninastartupsituationinvolvestheone-on-onerelationship

betweentheentrepreneurandthefunder.However,tofacilitateandsustainan

expandingandvibrantregionalstartupecosystem,greaterintegrationinvolvingmore

stakeholderswillhavetoplayamoresignificantrole.Clearly,theriskoffailureof

individualstartupsisveryreal,consideringthatmany,ifnotmost,startupsareessentially

engagedinhigh-riskexploratorydiscoveryresearch.Also,anyregionalpharma/biotechecosystemiscompetingwiththoseinotherregions,eachwiththeirownuniquestrengths

andcharacteristics.Together,thesepointssuggestthattheregionshouldtakeadvantage

ofwhatthedifferentregionalstakeholderclustershavetooffertooptimizeforstartups

successesintermsofprojects,productsandprocesses.Whileithasbeensuggestedby

somethataccesstocapitalfortheregionsstartupshasbeenlimitedandperhaps

decreasingothershavecounteredthatthetrulyinnovativeandpromisingstartupswill

typicallygetfunded.

OPPORTUNITIES:Imagineifbiosciencestartupentrepreneurshadaccesstoadedicated

resourceforassessinginitialfundingneedsandguidanceregardingfunding.

StartupPharma/BiotechCompanies

ThereisasignificantnumberoflifesciencesstartupandsmallcompaniesintheGreater

Philadelphiaregion,mostinthepharma/biotechareas,othersindiagnostics,devicesor

bioimaging.AnumberofthesearelistedintheLifeSciencesGuideofSelectGreater

PhiladelphiaandtheMembershipDirectoryofPennsylvaniaBIO,althoughitisworth

notingisthatthereisnotasingleup-to-datelistingoftheregionsbiosciencestartup

companies,orwhatspecificscientificormedicalcategoriestheybelongin,e.g.,by

therapeuticareasorplatforms.Tenrandomlyselectedregionalbiosciencestartupsare:

GalleonPharmaceuticals MeliorDiscovery QRPharma Tengion NuPathe Morphotek


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VitaePharmaceuticals Treventis Immunome MadrigalPharmaceuticals

StartupentrepreneursintheGreaterPhiladelphialifesciencessectorcomefromvariousbackgrounds.Somecomefrombigormediumsizepharmaceuticalcompanies,someare

serialentrepreneurs,andafewcomeoutofacademia.Whilemostofthefounderscome

fromwithinthisgeneralregion,afewcomefromoutsidetheregion.Inorderto

significantlystrengthenandexpandthelifesciencessmallbusinesssectorintheGreater

Philadelphiaregion,itwillbeimportanttobetterunderstandthechallengesandissues

theseentrepreneurshavefaced,andwheretheydecidedtolocate.Aquickinformal

surveyoftheregionssmalllifesciencescompaniesdoessuggestthatthereisgreater

heterogeneityandfewerconnectionsamongthesecompaniesthanthoseinthethree

majorbiotechhubsinthecountry,i.e.,Boston/Cambridge,SanFranciscoBayArea,and

SanDiego/LaJollaArea.Also,thereappeartobelimitedconnectionsbetweenthisregionslifesciencescompaniesandtheacademicresearchinstitutions.Bothofthese

factorshavebeenshowntobeimportantcharacteristicsofthethreemajorbiotechhubs

inthecountry.4

OPPORTUNITIES:Imagineiftherewereoptimalmechanismsforfacilitatingconnectionsand

communicationbetweenstartupentrepreneursandacademicresearchinvestigators.

BioscienceNetworkingGroups

Thereareafewregionalbiosciencenetworkinggroups,mostnotablythePharmaceutical

ConsultingConsortiumInternational(PCCI),theGreaterPhiladelphiaSeniorExecutive

Groups(GPSEG)LifeSciencesSubgroup,andBiostrategyPartners.Eachofthesehasits

ownobjectivesandmission,e.g.,PCCIiscenteredaroundmonthlypresentationsby

individualstartupcompaniesandtheGPSEGsLifeSciencesSubgrouphostsaseriesof

meetingaddressingspecifictopics.Others,suchasBiostrategyPartners,offerconsulting

services,lecturesandcoursesontopicsrelevanttostartingnewbiosciencecompanies.

TheScienceCentersQuorumprogramofferspresentationsandnetworking

opportunities,andthePennsylvaniaBIOsponsorspresentationsandpaneldiscussions.

PharmaceuticalConsultingConsortiumInternational GPSEGLifeSciencesSubgroup BiostrategyPartners UniversityCityScienceCentersQuorum

PennsylvaniaBIOSponsoredEvents

4Forexample,WhittingtonK,Owen-SmithJ,PowellWW.Networks,PropinquityandInnovationin

Knowledge-intensiveIndustries.AdministrativeScienceQuarterly,March2009,pp.90-122


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Inadditiontothesenetworkinggroups,therearenumerousopportunitiestoattend

lectures,workshopsandcoursesonavarietyoftopicsrelatedtoscientificandmedical

innovations,atthedifferentuniversitiesandacademicresearchinstitutions.The

challenge,however,hasbeenthatuntilrecentlytherehasntbeenacentralized

mechanismtobekeptawareofwhatisavailable,althoughthishaschangedwiththe

recentimplementationofBasecampBusiness,whichisapromisingevent/calendarlistingtool.

OPPORTUNITIES:Imagineifthedifferentregionsnetworkinggroupscollectivelyreevaluated

theirapproachesanddevelopedjointprogramsforsharingresourcesandexpertise.

TradeOrganizations

EachofthethreestateshavingcountiesinGreaterPhiladelphiahasabiosciencestrade

associationthatfocusesonpromotingthatstatesbioscienceindustry,servingasapublic

policyleaderandpublicadvocateforthebiosciencecommunity,andservingasacatalystfordevelopingacohesivebiotechnologycommunity.

PennsylvaniaBIO BIONJ DelawareBIO

Thesebiosciencetradeassociationsprovidegreatopportunitiesfordevelopingvitallinks

betweenthedifferentpharma/biotechstakeholders,largeandsmall,throughforumsfor

workshopsandconferences,facilitatingthedevelopmentofstrategicpartnershipsamong

stateandregionalpharmaceuticalcompanies,biotechnologycompanies,medicaldevice

companiesandresearchinstitutions.Theseorganizationshavethepotentialtoplaya

criticallyproactiveroleindevelopingagrowingregionalpharma/biotechstartup

ecosystem.

OPPORTUNITIES:Imaginetheimpactthesetradeorganizationscouldmakebyproactively

fosteringthedevelopmentofpharma/biotechstakeholderclusters.

ScientificandTechnicalExpertCommunity

TheGreaterPhiladelphiaregionhasarichpooloftalentforallofthefunctionsneededfor

afullyintegratedpharmaceuticalorbiotechnologycompany,fromtechnicalexpertstomid-levelandseniorlevelexecutives.Table1belowprovidesalistoftypicalfunctionsina

fullyintegratedlargepharma/biotechcompany;thislistisnotexhaustive.

Consideringthenumberoflayoffsinthepharma/biotechsectoroverthepastseveral

yearsinthisregionduetoreduction-in-forceand/ormergersandacquisitions,thereisa

sizeablepoolofhighlyeducatedandexperiencedtechnicalexpertsandmid-leveland

seniorlevelexecutiveswhoareinterestedinparticipatingindifferentwaystosupport


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Table1.TypicalFunctionsinaFullyIntegratedLargePharma/BiotechCompany.

MedicinalChemistry Biostatistics InVitroandInVivoPreclinicalEfficacy MedicalAffairs Pharmacology HealthOutcomes

DrugSafetyandToxicology

BusinessDevelopment DrugMetabolism/Metabolites IntellectualPropertyandPatentLaw TranslationalResearch RegulatoryAffairs Pharmaceutics/Formulations PharmaceuticalLaw EarlyClinicalDevelopment Chemistry,ManufacturingandControls ClinicalPharmacology SalesandMarketing Pharmacokinetics/Pharmacodynamics ProjectManagement LateStageClinicalDevelopment VaccineDevelopment ClinicalDrugSafetyandEpidemiology Manufacturing

GreaterPhiladelphiaspharma/biotechstartupecosystem.Whilemanyofthese

individualshavefoundnewjobs,inthisarea,commutingtoothercities,ormovedoutof

thearea,manyarestillunderemployedorintemporaryjobs.Thus,thistalentpool

representsanuntappedsourceofneededexpertiseindrugdiscoveryanddevelopment

forgrowingapharma/biotechstartupecosystem.

OPPORTUNITIES:Imagineiftherewasawell-organizedlistingofregionalconsultanciesand

experts,sortedbyexpertiseareas,neededforavibrantlifesciencesstartupecosystem.

ContractResearchOrganizations

Contractresearchorganizations(CROs)areincreasinglyperformingmanyofthenon-

clinicalandclinicalactivitiesthathavetraditionallybeendoneinternallybyfullyintegratedpharmaceuticalcompanies.SelectGreaterPhiladelphiaprovidesalistof

regionalCROsintheirGreaterPhiladelphiaLifeSciencesGuide,coveringbothnon-clinical

andclinicalCROs.Examplesofresearchactivitiesthatcanbeoutsourcedtothese

organizationsincludethoselistedinTable2below:

Table2.ResearchActivitiesOfferedbyContractResearchOrganizations.

TargetIdentificationandValidation BiomarkerServices PreclinicalDiscoveryResearch ClinicalResearch PreclinicalDrugSafetyandToxicology DevelopmentPlans DrugMetabolism DataManagement PharmaceuticsandFormulations RegulatoryAffairs AnalyticalServices MedicalWriting ProjectManagement Manufacturing

InadditiontothesemoreconventionalresearchareashandledbyCROs,recentlyformed

specializedmedicinalchemistryentities,specificallyMoulderCenterforDrugDiscovery


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ResearchatTempleUniversityandTheChemistryResearchSolution(TCRS)inBristol,

BucksCounty,areprovidingneededresourcesfornewcompanies.

MoulderCenterforDrugDiscoveryResearch TheChemistryResearchSolutionApotentialwayforstartuplifesciencescompaniestogainsignificantlygreaterefficiency

andspeed,andthusgettingfastertoago/no-godecisionpointregardingproof-of-

conceptorleadcompound,istoincreasetheinvolvementofCROsinperformingactivities

theyarebestat.Itsinthisgeneralareawheretechnologyparkscanhaveamajorimpact

byhousingdedicatedsupportlaboratoriesforpreclinicalwork.LifesciencesCROsinAsia,

particularlyinmedicinalchemistry,discovery,andpreclinicalsafetyandtoxicology,are

alsolikelytobeincreasinglyusedbypharma/biotechstartupsandsmallbusinesses,as

partofthegeneralglobalizationacrossotherindustries.

OPPORTUNITIES:Imagineiftherewasawell-organizedup-to-datelistingofallrelevantsupportfunctionsforpharma/biotechstartupcompaniesintheregion.

EstablishedPharmaceuticalandBiotechnologyCompanies

SevenofthetenlargestglobalpharmaceuticalcompanieshaveR&Dfacilitiesinthe

GreaterPhiladelphiaregion5,i.e.,GlaxoSmithKline,Merck,Pfizer,Johnson&Johnson,

AstraZeneca,Bristol-MyersSquibbandSanofi-Aventis.Therearealsoafewmid-size

companies,e.g.,Cephalon,EndoPharmaceuticals,ShireandNovoNordisk,withR&D

facilitieshere.

AstraZeneca

Bristol-MyersSquibb

Cephalon

EndoPharmaceuticals

GlaxoSmithKline

Johnson&Johnson

Merck

NovoNordisk

Pfizer

Sanofi-Aventis

Shire

Ashasbeenmentionedabove,largepharmaceuticalcompaniesarelikelytobe

increasinglydependentonaconstantsupplyofinnovativeproductsdiscoveredand

developedbystartupsandsmallcompaniestosupplementtheirpipelines.Thepresence

5InPennsylvania:GlaxoSmithKline,Merck,Pfizer,Johnson&Johnson,Sanofi-Aventis,Cephalon,Endo

Pharmaceutical,Shire;inNewJersey:Bristol-MyersSquibb,NovoNordisk;inDelaware:AstraZeneca.


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ofthelargetomediumsizepharmaceuticalcompaniesintheregionrepresentsgreat

potentialopportunitiesforconnectionsandcollaboration.

OPPORTUNITIES:Imagineiftheselocallybasedlargetomediumsizepharmaceutical

companiesactivelyparticipatedandcontributedtothestakeholderclusters.

StateandLocalGovernments

Ultimately,thethreestatesformingtheGreaterPhiladelphiaregionhavethemostat

stakeinseeingathrivingandgrowinglifesciencessectorintheregion.Eachofthesehas

itseconomicdevelopmentoffices.

CommonwealthofPennsylvania StateofNewJersey StateofDelawareInordertohaveatrulymeaningfulimpactonsignificantlygrowingtheGreater

Philadelphiaslifesciencesstartupsector,thethreestateswillneedtoplayamore

proactivecollaborativerolethantheyhaveinrecentyears.

OPPORTUNITIES:Imagineifthethreestatesdevelopedacomprehensiveactionplanforthe

regiontightlyconnectedtolocalactivitiesinvolvingthestakeholderclusters.


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REQUIREMENTSFORASUCCESSFULINTEGRATEDSTARTUPECOSYSTEM

ElementsofaRegionalLifeSciencesEcosystem

Anecosystem,asusedhere,isdefinedasadynamicandcomplexsysteminvolvingthe

interactionsbetweenacommunityofinterconnectedstakeholdersonwhomtheircombinedoptimumsuccessdependsdirectlyorindirectly.Consideringthetenclustersof

stakeholdersdiscussedabove,whichformtheregionslifesciencesecosystem,thereisa

greatnumberofpotentialconnectionsamongsttheseclusters,asisdepictedinFigure2,

althoughsomeofthesewillbestrongerdependingonthespecificobjectivesofeach

interaction.

Figure2.OpportunitiesfromIntegrationofInterconnectedClusters

ofStakeholders.

Inadditiontothebenefitsoffosteringandbuildingtheconnectionsbetweenindividual

clusters,onealsoneedstoconsiderthebenefitsofinteractionswithinanygivencluster.

Infact,insomecircumstances,thesemayinfactbeequallyimportantasthosebetween

clusters.Alloftheseconnections,betweenandwithinstakeholderclusters,needtobe

consideredfortheirleveragingimpactonmaintainingandgrowingthepharma/biotech

startupecosystem.

ACADEMIC'

RESEARCH'

INSTITUTIONS

PHARMA/

BIOTECH''

COMPANIES

STATE'&

'LOCAL'

GOVERNMENTS'

SCIENTIFIC'&'

TECHNICAL'

COMMUNITY

CONTRACT'

RESEARCH'

ORGANIZATIONS

'TRADE'

ASSOCIATIONS

BIOSCIENCE

NETWORKING'

GROUPS

STARTUP

BIOSCIENCE'

COMPANIES

STARTUP'&'

LONGER;TERM

FUNDING'

INCUBATORS'&

TECHNOLOGY'

PARKS


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InitialAssessmentofStrengths,Weaknesses,OpportunitiesandThreats

WhiletheGreaterPhiladelphiaregionhasamajorpresenceinthepharmaceuticalsector,whichislargelyduetothepresenceofseverallargecompanies,theregionislagging

behindinstartupandsmallbusinessactivityinthissector.Consideringthemanyand

diversechallengesfacingthepharmaceuticalindustrytodayandthecurrenteconomicslowdown,coupledwithanincreasingdependenceofthelargerpharmaceutical

companiesoninnovativeproductsdiscoveredanddevelopedbystartupsorsmall

businesses,thisrepresentsaconcern,andanopportunity,fortheregion'sfuture.

Whilethereareanumberofimpressiveindividualeffortstodevelopastrongpharma/biotechstartuppresenceintheregion,theseappeartohavebeenisolated,

independenteffortsthathavenotsystematicallyleveragedallthepotentialsynergiesof

thecollectivestakeholdersintheregion.

Thelifesciencesstartupandsmallbusinessesintheregionappeartobemoreheterogeneousandtohavefewerconnectionsamongthemselvesandwiththeregionsacademicresearchinstitutionsthanisobservedinthethreemajorbiotechhubsinthe

country.Althoughwearenotawareofanypublishedresearch,onewouldexpectsuch

characteristicsofalifescienceshubtobepotentiallyassociatedwithlesscutting-edge

andinnovativeresearchthanitotherwisecouldbe.

Perhapsthemostimportantimpressionisthattheredoesntappeartobeacohesiveandwell-connectedcommunityofstakeholders.Infact,theredoesappeartobealackofa

unifiedcenterofgravitytobringtheGreaterPhiladelphiaregiontotheleadership

positioninthelifesciencessectoritneedsanddeserves.

Anassessmentofthestrengths,weaknesses,opportunitiesandthreatswithrespecttoamajorregionalpharma/biotechstartupecosystemisshowninFigure3.

Figure3.SWOTAssessmentofGreaterPhiladelphiaRegionsLifeSciencesEcosystem.

STRENGTHS

Outstanding1Academic1Research1Ins9tu9ons

Many1Large1Pharma/Biotech1Companies1

Highly1Educated/Experienced1Workforce

Several1Incubator1Facili9es

OPPORTUNITIES

Integrated1"HardWired"1Community1of1Stakeholders

Integra9on1of1Scien9fic1and1Technical1Experts

Revised1Technology1Transfer1Prac9ces

Educa9on1and1(Re)Training1of1Workforce

THREATS

Ongoing1Large1Pharma/Biotech1Challenges

Unchanged1Incen9ve1Mechanisms1in1Academe

Limited1Progress1from1Genomics1Revolu9on

Limited1State1and1Federal1Involvement

WEAKNESSES

Low1Standing1in1Small1Business1Vitality1Index

Lack1of1Unified1Voice1and1Presence

Limited1Intera9ons1Amongst1Stakeholders

Limited1Startup1and1Venture1Capital1Funding


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FromIdeastoProducts:AComplexandHigh-RiskProcess

Drugdiscoveryanddevelopmentisanexceptionallycomplicatedandhigh-risk

proposition,requiringnumerousdisciplinesandfunctionscollaboratingandproviding

theirexpertiseforasuccessfuloutcome.ThefivelargechevronsinFigure4depictan

outlineofthisprocess,whichtypicallytakes10-15years,startingwithanideainvolvingaspecifictargetandaspecificintendedindicationonthefrontend,andendingwitha

submissionofamarketingapplicationtoregulatoryauthoritiesontheotherend.The

largefullyintegratedpharmaceuticalcompanieshavedevelopedhighlyintegratedand

efficientprocessestomanagedrugcandidatesthroughthisprocess,withappropriate

expertcross-functionalteamsresponsiblefordifferentpartsoftheprocessandguidelines

forgo/no-gocriteriaatthedifferentmilestones.

Thereisalotapharma/biotechstartupecosystemcanlearnfromthewaysuccessful,fully

integratedlargepharmaceuticalcompanieshavemanagedthisoverallprocessinthemost

costeffectivemanner.Atthesametime,thereisalsoalotlargepharmaceuticalcompaniescanlearnfromthewaypharma/biotechstartupandsmallcompaniesoperate,

beingmoreagileandlessbureaucratic,applyingmorecutting-edgescience,andmore

willingtoexperimentwithinnovativebusinessmodels.Itisthroughacoordinated

integrationoftheappropriatestakeholderclustersthattheGreaterPhiladelphiaregion

canbesuccessful.Interestingly,itisthiskindofanintegration,requiringathoughtfuland

deliberatedialogue,wheretheGreaterPhiladelphiaregionhasoftenexcelled.

Figure 4. Process map of the drug discovery and development process (large

chevrons),alsoshowingwherethedifferentstakeholderclusterscaninteract.

Exploratory*

DiscoveryTargets

Genomics

Networks

Full*

DiscoveryChemistry

Efficacy

Indica8on

Preclinical*

DevelopmentDrug;Metabolism

Drug;Safety

Pharmaceu8cs

Early*Clinical*

DevelopmentBiomarkers

Transla8on

Learning

Late*Stage*

DevelopmentClinical;Trials

Registra8on

Confirming

Academic*Research*Ins?tu?ons

Incubators*and*Technology*Parks

Bioscience*Trade*Organiza?ons

Scien?fic*and*Technical*Expert*Commuinty

State*and*Local*Governments

Bioscience*Networking*Groups

Startup*and*Longer*Term*Funding*Mechanisms

Contract*Research*Organiza?ons

PRODUCTSIDEAS

Startup*Bioscience*Companies Established*Pharma/Biotech*Companies

IND NDA/BLA

PROJECTS PROCESSES


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PATHFORWARD

Basedontheanalysispresentedinthispaper,theoverarchingconclusionisthatall

relevantstakeholdersneedtoaddresstogether,withasenseofurgency,howbestto

advanceavibrantandgrowingpharma/biotechstartupecosystemfortheGreater

Philadelphiaregion.Consideringthecurrenthighattritionratefordevelopmentcompounds,aswellasforstartupcompanies,oneobviousconclusionisthatmuchgreater

interactionisneededbythedifferentstakeholderstooptimizeforthesuccessofregional

pharma/biotechstartupandsmallcompanies.Intheconsiderableliteratureavailable

aboutthehistoryandsuccessfactorsofthemajorbiotechhubsinthecountry,one

characteristicisthattheyhavemorehard-wirednetworks,whichhavefostered

continuinggrowthandsurvival.Thisisthereforeoneofthekeyissuethatneedtobe

addressed.

Onthepositiveside,theregionhasmost,ifnotall,ofthecollectiveexpertiseneededto

makethiswork.Thisincludesallthedifferentstakeholderclustersthathavebeendiscussedabove.Anotherpositivefactorinvolvesthegreatinterestandsupportbythe

regionsbiosciencesleadership,aswitnessedbyimportantconferencesheldduringthe

pastyear,e.g.,theBioPharmaConferenceatWestChesterUniversity(May2012)and

PCCIs5thAnnualRoundtableonfederalsupportforlifesciences(June2012),aswellasby

theissuanceofareportonLifeSciencesLeadershipfortheNextDecadebythe

CommonwealthofPennsylvaniasLifeScienceLeadershipAdvisoryCouncil(May2012).

Furthermore,thereareseveralexamplesofgreatactivitiesandinitiatives,suchasthose

sponsoredbytheScienceCenter,PCCI,andUPstart,tonameonlythree.

Itisthereforenotunreasonabletoaskwhatsneededthatisntalreadybeingdone?In

short,whatsmissing,ashasbeendiscussedabove,istheintegrationofthedifferent

stakeholderstocollectivelyfosterandsupportonabroadbasistheregions

pharma/biotechstartupecosystem,togetittoaplacewhereitneedstobeanddeserves

tobe.Thiswillrequiremuchgreaterandcloserinteractionsamongthedifferent

stakeholdersthanappearstohavebeenthecase.Andnote,thiswillnothappenonits

ownproactiveinvolvementisrequired.

ProposedNextSteps

Belowisalistofproposednextstepsandactivities.Someofthesehavebeenhintedatas

opportunitiesforeachofthestakeholderclusters.Thislistisbynomeansexhaustive,norisitinaprioritizedorder,ratheritismeanttoserveasanexampleofwhatcanbe

envisionedasadevelopmentalpathforahighlysuccessful,integrated,creative,and

growingpharma/biotechecosysteminGreaterPhiladelphia:

Formaninitialworkinggroupofapproximately10-15interestedindividualsrepresentingdifferentstakeholderclusterstodevelopageneralactionplan.


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Guidethecreationofindividualclustersofstakeholders,andfosterthedevelopmentofasharedunderstandingofthebenefitsofworkingtogether.

Developaworkscopedocument,withstakeholderbuy-in,includingspecificgoalsandobjectives,andidentifyspecificworkgroupsthatmayneedtobeformed.

Developasetofmetricsbywhichtomonitorprogresstowardsdefinedgoalsandobjectivesandatimetableforachievingthese.

Createacoalitionofclustersofstakeholderswhosemissionitistoadvanceavibrantandgrowingecosystemforpharma/biotechstartupsandsmallbusinessesinGreater

Philadelphia.

Exploreinasystematicmannerthehiddenpotentialsynergiesintheconnectionsbetweenandwithinthestakeholderclusters,e.g.,academicresearchinstitutions

harmonizingbestpracticesanddevelopingjointworkshops.

Formanetworkofthescientificandtechnicalexpertcommunitywithextensiveexperienceandexpertiseindrugdiscoveryanddevelopment,andestablishmechanismstoconnectthesewiththepharma/biotechecosystem.

Conductselectedworkshopsandtaskforces,includingparticipationinprecompetitivecollaborativeefforts,aimedataddressingkeyopportunitiesandchallengesfacingthe

biopharmaceuticalindustryandthescientificcommunity,whichstartupscantake

advantageof.

ACKNOWLEDGEMENTS

Workingdraftsofthefirstversionofthispaper(December2010),wereinitiallyforwardedtoaboutseventycolleaguesandfriendsduringthelatterhalfof2010,representingmost

ofthestakeholderclustersdiscussedinthispaper.Anumberofveryvaluableand

insightfulcommentsweregenerouslyoffered,whichhelpedmakingthepaper

significantlybetter,andIamforeverindebtedtoallofthesecolleaguesandfriends.This

revisedandeditedversion(April2013),addressesafewomissions,e.g.,addingatenth

shareholdercluster,BioscienceNetworkingGroups,addingafewmemberstosomeofthe

stakeholderclusters,andstreamliningtheproposednextsteps.


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ABOUTTHEAUTHOR

Dr.ThorirD.Bjornssonhasheldpositionsbothinacademiaandindustry,theformerat

DukeUniversityMedicalCenterandJeffersonMedicalCollege(totaling18years),the

latteratBristol-MyersSquibbandWyeth(totaling13years).AtJeffersonMedicalCollege,

Dr.Bjornsonheldanendowedchair,SamuelM.V.HamiltonFamilyProfessorofMedicine,ProfessorofPharmacology,andDirectoroftheDivisionofClinicalPharmacology.At

Bristol-MyersSquibbandWyeth,heheldthepositionofVicePresidentandledglobal

earlyclinicaldevelopmentandclinicalpharmacology,acrossalltherapeuticareas,for

bothsmallmoleculesandbiopharmaceuticals.Subsequently,heworkedwiththeCritical

PathInstitute(2years),andatthepresenttimeheisPresidentofanewnonprofit,

TherapeuticsResearchInstitute.Dr.Bjornssonreceivedhisclinicalpharmacologytraining

atStanfordUniversityMedicalCenter.Dr.Bjornssonhaslednumerouscross-functional

andcross-organizationalinitiatives,aimedatorganizationalandprocessimprovements,

andoptimizingscientificandprecompetitivecollaboration.Hehasreceivednumerous

awardsforhiswork,andhasbeenanactivememberonseveralprofessionalsocietycommitteesandreviewcommitteesaswellasindustryprofessionalorganizations.Hehas

authoredorco-authoredapproximately230papers,abstracts,andbookchapters.

AddressCommentsTo:

ThorirD.Bjornsson,MD,PhD

539St.DavidsAve.

SaintDavids,PA19087

Phone:610-688-8911

Mobile:610-733-0763

Email:[email protected]

Documents

Pharma-Biotech Startup Ecosystem Apr 2013