PHILADELPHIA – A new multi-institutional proof-of-concept center in five months will begin soliciting the first of three rounds of formal proposals from researchers in the Philadelphia region seeking pre-seed funding to help commercialize their life-science technologies, a key organizer of the effort told reporters last week.
The proof-of-concept center will award up to $200,000 over 12 months that will be matched by the institutions contributing the technology, and this city's University City Science Center.
The center is part of a broader 18-month pilot program intended to strengthen the region's tech-commercialization effort — long a weakness in the region's quest to build a top-tier life-sci cluster.
The center will be named QED, the abbreviation for "quod erat demonstrandum," the Latin phrase appended to mathematical or philosophical proofs.
"We're taking projects that are still owned by university tech-transfer offices, and funding them to the point where they can be a viable venture," Stephen Tang, the Science Center's president and CEO, said in describing the effort during a presentation before a group of journalists, held at the campus. "We know that we won't pick all winners. So the idea here is to clear the pipeline of the losers quickly so that things don’t linger in our environment and lose credibility over time."
QED is one of several tech commercialization programs planned for launch over the next year and a half by a consortium of research institutions, life-sci businesses, and Science Center.
With 2 million square feet of space in 15 buildings spread over 17 acres, Science Center is the nation's oldest and largest urban science campus and is a key player in the tech-commercialization campaign. However, it had yet to discuss details until last week, even after outlines of the effort — including the proof-of-concept center — had surfaced here at a Dec. 15, 2008, conference whose speakers included Pennsylvania Gov. Edward Rendell [BRN, Jan. 5].
The first request for proposals "will come to fruition in June or July. We're going to be in pre-solicitation over the next, probably, 30 to 60 days," Tang said, answering a BioRegion News question during the presentation.
Tang's remarks followed a presentation of the multiple programs that will comprise the broader tech-commercialization effort to the group of journalists, which was invited to visit Science Center as part of a four-day tour of life-sciences employers.
The 2nd International Life Sciences Press Tour was arranged by Select Greater Philadelphia, a regional economic-development group that promotes life-sci and other technology development within an 11-county region that straddles northeast Pennsylvania, southern New Jersey, and northern Delaware.
During his presentation, Tang detailed plans to solicit three rounds of RFPs for entrepreneurs interested in commercializing technologies developed by subsets of the two dozen universities and research institutions participating in QED.
The first subset, which will join with responding entrepreneurs, includes Children's Hospital, the University of Delaware, Drexel University, the Lankenau Institute for Medical Research, Rutgers-the State University of New Jersey, Temple University, Thomas Jefferson University, the University of Pennsylvania, the University of the Sciences, and the Wistar Institute, a nonprofit biomedical research institute in Philadelphia.
During the fourth quarter, QED will release its second RFP for work with technologies developed at Fox Chase Cancer Center, Monell Chemical Senses Center, Philadelphia University, Rowan University, Villanova University, and Widener University.
And during the second quarter of 2010, QED's third RFP will go to entrepreneurs wishing to form tech-commercialization partnerships with Delaware State University, East Stroudsburg University, Lafayette College, Lehigh University, Lincoln University, the Philadelphia College of Medicine, Salus University, and Swarthmore College.
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Tang said he envisions funding three projects based on the first RFP, five projects detailed in the second RFP, and 10 projects from the third RFP.
"The ultimate goal here is to create a much larger fund, and have a much larger presence, and fund many more projects," he said. "Very simply, we see ourselves as an intermediary that catalyzes convergence of early-stage technology, funding, entrepreneurs, facilities, and business services, in the greater Philadelphia technology ecosystem.
"What we're trying to do is maximize the value of early-stage technology generated by researchers across the region, to accelerate technology commercialization," Tang added.
As a result, he said, Science Center hopes to reduce the risk for entrepreneurs and investors, match new technologies to successful entrepreneurs, and help the region draw top-flight faculty and students to metro Philadelphia.
QED hopes to support emerging companies in Philadelphia's life-sciences industry much as two such existing centers nationwide have done for engineering: The Deshpande Center at the MIT School of Engineering, and the von Liebig Center at the University of California-San Diego Jacobs School of Engineering, both of which were studied in a January 2008 report by the Ewing Marion Kauffman Foundation, available here.
QED will fund "some combination of therapeutics, whether pharmaceuticals or medical devices, in vivo and in vitro diagnostics, or some sort of other device or research tool," Tang said. "We're going to target the life science industry because we have such a high concentration of those companies here."
Not only startups, he said, but later-stage companies that could expand within University City, including overseas companies eligible to use the Science Center's 3-year-old Global Soft Landing program, funded in part by the US Commerce Department's Economic Development Administration.
Metro Philadelphia, he said, could learn from Cambridge, Mass., which has evolved into the East Coast's largest biocluster by nurturing life-sci startups and retaining them as they grew into multi-million-dollar corporations. He cited Novartis' growth in the city in part by converting a former factory of the New England Confectionary Co. into the 500,000-square-foot headquarters of the Novartis Institutes for BioMedical Research.
"We need to do the same in Philadelphia," Tang said. "We need to keep jobs, we need to keep this growth alive in this urban center."
The Science Center also plans to turn 4,000 square feet of vacant space within its newest building, the 155,000-square-foot 3711 Market St., into a "clubhouse," or site for formal and informal meetings between researchers, venture capitalists, entrepreneurs, and other life-sci professionals.
The clubhouse will offer a boardroom with videoconferencing capability, "the ability to have something to eat, something to drink in a café style, with very soft seating areas, all of which will be wired in a Wi-Fi environment" and designed to look "a lot like a really nice airport lounge," Tang said.
The clubhouse will be intended to be a place "where people can gather and talk about ideas, talk about innovation, which will ultimately lead to higher-quality projects and higher-quality entrepreneurial ventures," said Tang.
In addition to life-sci entrepreneurs, the clubhouse hopes to draw IT, nanotechnology, marine and alternative energy, "and the businesses and financial services supporting these communities," he added.
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That site, to be dubbed the Quorum, is one of three services planned under that name. In addition to building out the Physical Quorum, Science Center will support programs and events at numerous venues around the Philadelphia region as part of what it calls a Satellite Quorum. Philadelphia-area life-sci and tech community members will also be linked through an online community, or Virtual Quorum.
"The reason we picked 'Quorum' is because it means 'that which is required to transact business,'" Tang said.
Science Center has committed $1 million over "several" years to launch the tech-commercialization programs, Tang said, adding that the center has won support from Pennsylvania officials to match an as-yet undisclosed part of that investment. Science Center will seek a similar amount of funding from Delaware and New Jersey, said Tang.
The Quorum services, like the proof-of-concept center, are designed to accelerate tech commercialization in a region whose historically weak tech-transfer effort was faulted by a group of CEOs in a 2007 report.
CEO Council for Growth, a group of more than 70 business leaders in Philadelphia and 10 nearby counties, concluded in a recent report that the region’s tech-commercialization effort did not reflect the volume of commercial tech activity, including biotech startups, of its concentration of academic institutions and pharmaceutical companies [BRN, Oct. 15, 2007].
The 36-page report, titled Accelerating Technology Growth in Greater Philadelphia, was commissioned by the Economy League of Greater Philadelphia, a nonprofit policy research group that champions regional economic growth.
Tang said the Science Center will position itself as an intermediary that can help bridge what he called the "culture clash" between the region's academic and business sectors. He said it will also strive to become a catalyst to promote tech commercialization in and around Philadelphia by uniting the two sectors with venture capitalists and public and private economic-development groups.
The Philadelphia region's key challenge, Tang said, is attracting venture capital comparable to the research dollars drawn by the region's universities and research institutions. While Philadelphia is third-highest among metropolitan areas in drawing National Institutes of Health research grant dollars — about $800 million in the federal fiscal year that ended Sept 30, 2007 — it fares worse in VC awards.
According to the annual MoneyTree Report, just as the US economy and financial institutions were skidding into financial turmoil, the Philadelphia region racked up $45.5 million in seven venture capital deals during the fourth quarter of 2008, down almost 26 percent from $61.3 million in nine deals during the final three months of 2007.
Year to year, however, metro-Philadelphia finished 2008 with $278.7 million in venture capital, down nearly 19 percent from $343 million in Q4 '07, both years yielding 29 deals.
"That gap today is really an opportunity to accelerate technology commercialization," Tang said.
The current financial upheaval, he said, heightens the chances of startups being stranded by nervous investors pulling back from earlier commitments.
"We believe if we start this process right now, even under this rather severe economic climate we can begin to fill the pipeline of projects, so that when we do recover, that pipeline will be full," said Tang. "And by engaging the rest of the ecosystem, the rest of the community, we can gain support of some very early-stage technology that hasn’t been there before."
The tech-commercialization effort marks Science Center's effort to address priorities that Tang cited in an interview with BRN just over a year ago, when he was named to the Science Center helm over interim president Dean Lewis and other candidates [BRN, Jan. 21, 2008].
“I think it’s a matter of defining the community, setting priorities, and finding a way to work together. Those are the challenges ahead,” Tang told BRN at the time. "Perhaps we needed a catalyst or a way to align interests better. That’s hopefully the basis of the leadership that I will bring to the SC and to the region.”
Third Incubator's the Charm
During the presentation, Tang and Curt Hess, the Science Center's senior vice president of real estate operations, told reporters that the campus has a new asset ready to use in its tech commercialization program: the 10,000-square-foot third incubator of lab and office space completed late last month.
At deadline two companies had agreed to lease office space in the space: Avid Radiopharmaceuticals, a clinical-stage developer of molecular imaging agents; and ERYtech Pharma, a French biotechnology company specializing in encapsulating therapeutic molecules or enzymes into red blood cells.
Rents in the third incubator will range on average from about $1,300 per month for office space — with office amenities that will include Internet, use of a copier, and a fax machine — while lab rents will range from about $2,500 per month for a quarter of a lab suite, to about $10,000 per month for a full lab suite.
The new incubator joins two existing facilities at Science Center, one at 3701 Market St., the other at 3624 Market St.