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Arizona’s Two Life Science Groups Combine As $1.2M Budget Gap Threatens SFAz Funding


The Arizona BioIndustry Association last week said it is well under way to becoming the voice of the state’s life-science industry after its recent merger with the Bioindustry Organization of Southern Arizona.
The deal, which took effect with the combined board’s first meeting in February, resulted in a roughly 120-member organization whose stated goals are to increase the size of the state’s life-science footprint and advance the views of that industry more effectively than either group had done alone. The new group will retain the Arizona BioIndustry Association name, but the ABA will go by a new acronym, AZBio.
“It’s just a matter of people believing that it would be beneficial for the industry throughout the state to speak with one united voice,” AZBio President and CEO Robert Eaton told BioRegion News last week. “But also, by having a larger, more robust association, it will allow us to be able to have the folks in southern Arizona be able to take advantage of having the staff that AZBio has. It will enable them to do more things for the benefit of all of our member companies.”
The new group will have an uphill climb. For instance, Science Foundation Arizona, a public-private group that links academic-industry collaborations, is set to lose $25 million in state funding as part of a budget-tightening plan for the fiscal year that begins July 1.
The state’s $10.6 billion budget for that period, proposed in January by Gov. Janet Napolitano, a Democrat, is being reviewed by state lawmakers at a time when the Grand Canyon State struggles to fill a $1.2 billion budget chasm projected for fiscal 2009, a symptom of the overall malaise in the US economy.
AZBio must still decide whether and how to fight the budget cut in the legislature — decisions to be made by the organization’s restructured board of directors, Eaton said.
“That would certainly be up to the board of directors to decide whether or not we want to take a position on any proposed cuts,” Eaton said. “AZBio is certainly supportive of Science Foundation Arizona and their continued funding.”
Eaton, who took the group’s helm late last year, is one of two paid staffers for the new AZBio, which will operate on a budget of about $350,000. The other is Natascha Hebell-Fernando, who serves as chief operating officer. That staff could grow depending on revenue and member growth, he said.
Eaton said he and Hebell-Fernando will visit Tucson and Flagstaff “as often as needed to serve the members in those areas. AZBio, based in Phoenix, is also working on future events; new education and workforce development programs; and improving a group purchasing program for members.
AZBio contends that its merger with Tucson-based Bioindustry Organization of Southern Arizona, known as BIO-SA, has wrought a restructuring that will allow for both the regional presence and events of its predecessor groups, and a stronger voice on statewide issues.
The new organization said that statewide focus is reflected in its reconstituted board of directors, which now includes 16 research and industry professionals from across Arizona [see sidebar, below, for more information]. The new board met for the first time Feb. 15.
The combined group is also gearing up to present Biozona 2008, AZBio’s annual conference intended to link life science professionals with potential collaborators, investors and clients, set for April 8 at the Manning House in Tucson.
The merger gibes with Arizona’s Bioscience Roadmap, the blueprint for growing the state’s life-science cluster developed in 2002 by the Battelle Memorial Institute, the global R&D and laboratory-management organization headquartered in Columbus, Ohio.
The Roadmap report, available here and summarized here, recommended strengthening the industry’s representation to government and other leaders across Arizona by creating a statewide life-sciences group from what had been three regional associations.
“Our goal is not just to implement the Roadmap. Our goal is to serve our member companies,” Eaton said.

“We found having a strong industry association to be one of the important ingredients for success over the long term in building a bioscience cluster.”

AZBio traditionally focused on its Phoenix home base, while BIO-SA had been based in Tucson and focused there. A third group, the Northern Arizona Bioscience Steering Committee, has worked for more than a year to develop the industry in its namesake region, where Battelle recently completed a more detailed regional Roadmap report published late last year [BioRegion News, Nov. 26, 2007] and available here.
AZBio hopes the northern Arizona group will eventually grow into a full-fledged association that will also merge into it, according to Eaton.
“They’re going to have strong regional associations, but working together on a combined state association, so it’s the best of both worlds,” said Walter Plosila, a senior consultant to Battelle’s technology partnership practice who authored Arizona’s Bioscience Roadmap, completed by Battelle in 2002 and updated since then, most recently last year.
Plosila will remain active in helping Arizona grow its life-science industry despite retiring earlier this month from a full-time position with Battelle, where he had been vice president of the group’s tech-partnership practice [see the BRN Interview, this issue].
“I think the challenges of having technology industry leaders and industry associations that can explain industry’s thinking, bring key industry players to the table and work directly with a legislature, doing all that kind of educational and advocacy is very important in any state, including Arizona,” Plosila said. “If you look at the history around the country, including my own history, in building a strong bio industry, we found having a strong industry association to be one of the important ingredients for success over the long term in building a bioscience cluster.”
Building such an association in Arizona, he said, required combining a Phoenix group long envisioned as a statewide association with a Tucson group that enjoyed more participation from life-science companies.
“There are benefits to both groups, and the challenge was to get the right chemistry in place for a true statewide association, so that neither felt that the other was going to dominate,” Plosila said. “They worked out, I think, a pretty interesting approach not unique to Arizona, but somewhat similar to Colorado and other places where you have regional groups that are chapters of a strong statewide group.
“It all came down to the issues of who’s going to dominate, whose agenda is going to be set, and all of that,” he added.
Eaton said merger talks were in progress when he joined AZBio in October 2007.  “It had been in the works for a considerable amount of time, probably over a period of a year.”
At AZBio, Eaton succeeded Jon McGarity, who left the organization the previous May to join InSys Therapeutics, a developer of drug-delivery systems focused on pain management and central nervous system disorders that moved its headquarters to Phoenix from Chicago.
Eaton arrived at AZBio seven months after resigning as president and CEO of MdBio, Maryland’s life-science industry group, and a division of the Tech Council of Maryland.
Eaton, who has declined to disclose the reasons for his departure from MdBio, defended his tenure during an interview last year with a BioRegion News’ sister publication, GenomeWeb Daily News. Eaton cited MdBio’s growth to 110 members following its 2005 merger with the tech council, the expansion of workforce development programs, and the launch of the annual Mid-Atlantic Bio Conference, co-organized with the Virginia Biotechnology Association.
Speaking last week to BRN, Eaton said the challenge of building a statewide life science group in Arizona was not too different from what he faced in Maryland.
“It has some similarities because there are some strong regional presences in Maryland that needed to work together more effectively as one statewide association,” Eaton said. “The distances in Arizona are a little bit bigger. Obviously it’s a larger state, geographically, so that poses somewhat different challenges, although the congestion in Maryland makes it impractical — even shorter distances take just as much time to travel between.”

New Board Draws Pros from Across Arizona
Intent on reflecting the geographic breadth of Arizona’s life-science industry, the Arizona Bioscience Organization, known as AZBio, has named 16 professionals to its new 21-member board of directors.
Six members of the board will come from the Phoenix region, six from the Tucson region, and three from the Flagstaff/northern Arizona region; the remaining six will be at-large members that can come from any regional group, and will be chosen by the 15 regionally based directors:
  • Rob Ashley, CEO of Ashley BioPharm, Tucson.
  • David Cohen, president of Can-Am Pharmaceutical Services, Tucson.
  • Michael Cusanovich, director of Arizona Research Labs at the University of Arizona, Tucson.
  • Gordon Goodyear, senior principal and president of 3dbiosurfaces, Tucson.
  • Saundra Johnson, executive vice president of the Flinn Foundation, Phoenix, and the board’s sole at-large member to date.
  • Rob Kennedy, CFO of Apthera, Scottsdale.
  • Edward Koeneman, chief operating officer of Kinetic Muscles, Tempe.
  • Loretta Mayer, chairman of the board and president of SenesTech, Flagstaff.
  • Christine Meis McAuliffe, a member of the Phoenix law firm Jennings Strouss and Salmon, and co-chair of the firm’s biotechnology and life sciences industry group.
  • Jon McGarity, head of InSys Therapeutics in Phoenix, and AZBio’s former president and CEO.
  • Michael Mobley, associate director Biodesign Institute at Arizona State University, Tempe.
  • Jacqueline Nicol, director of intellectual property and partnering for BioVigilant, Tucson.
  • Nina Ossanna, director of business development for the BIO5 Institute at the University of Arizona, Tucson.
  • Thomas Rainey, president of the Northern Arizona Center for Emerging Technologies, a nonprofit small-business assistance program in Flagstaff.
  • Debbie Snyder, vice president of operations for TGen Drug Development Services, Scottsdale.
  • Diane Williamson, president and CEO of Earth Friendly Fuels, Flagstaff.

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