By spending $800 million over the next decade on new researchers and facilities, the University of Kansas Medical Center hopes to grow into one of the nation’s top 20 research centers — as well as quadruple its research budget, address a key local public health issue, and accelerate a decade-old regional biotech effort.
KUMC’s research initiative, announced June 19 and dubbed ”The Time is Now: KU/KUMC 10-Year Life Sciences Strategy,” calls for the medical center to hire 244 new researchers and build 862,500 square feet of new facilities at its main campus in Kansas City, Kan., as well as its other campus in Lawrence, Kan., through 2016.
During that time, the new researchers are expected to help the medical center nearly double its research budget from the current $76 million to $150 million, within five years, and more than double that sum to $340 million in another five years. KUMC said it would also build up 10 programs deemed to be promising, and pursue National Cancer Institute designation for its KU Cancer Center.
“I think we’re doing just about everything we can do as far as the number of applications going in with the current size of our faculty. What we need to do is to grow our faculty, to get more applications in,” Paul Terranova, KUMC’s vice chancellor for research, told BioRegion News on June 20. He spoke a day after KUMC announced “Time is Now” details in a 48-page report.
“It’s just like sales. You knock on more doors, you make more sales,” Terranova added.
At $453.6 million, the initiative’s largest single expense would be hiring the new researchers. They would include 152 senior researchers expected to bring with them sizeable grant funding from the National Institutes of Health or other sources; the remaining 92 would be junior researchers with no such requirement.
The expense reflects the cost of relocating professionals; nearly all are expected to be recruited from elsewhere, Terranova said. The report calculated KUMC will pay $2.5 million per senior researcher and $800,000 per junior researcher over five years.
Such expenses would be justified, the report concluded, by the $7 billion in economic impact that expanding KUMC is projected to generate based on the additional research. That impact, he said, would be comparable to the $4 billion in economic activity generated by the University of Iowa, which had a total $137 million in research funding in 2006.
“Since Iowa has one medical school and we have one medical school, we thought that it would be a good state to compare with,” Terranova said.
Building an ‘Entrepreneurial Culture’
The initiative offers the promise of providing a major lift to the area’s life sciences industry: “Not only statewide in Kansas but regionally in the Kansas City area, it would be a big step forward,” said William Duncan, president of the Kansas City Area Life Sciences Institute in Kansas City, which promotes regional biotech development.
But an observer of biotech efforts in the Midwest cautioned that “Time is Now” alone won’t guarantee the biotech success sought by the Kansas City region.
Walter Plosila, vice president of the Battelle Technology Partnership Practice, said the region will also need to build an entrepreneurial culture allowing companies to build strong management teams, as well as draw investors for all stages of venture capital, step up its NIH funding, and strengthen its technology commercialization effort.
“Just having [“Time is Now”] by itself is not enough. It takes 12 to 14 years even after you build the research base and do all these other things you have to do to build biotech-driven economies like San Diego or [North Carolina’s] Research Triangle Park,” Plosila said.
“Time is Now” marks the newest phase of a campaign to grow biotechnology in the Kansas City region that straddles Kansas and Missouri. After Jim and Virginia Stowers, cancer survivors and founders of American Century Investments, established the Stowers Institute for Medical Research in Kansas City, Mo., in 1994, business and government leaders formed a task force that in 1999 recommended building a cluster whose institutions could grow over 10 years to generating a combined $500 million a year in research.
While the Stowers gave more than $300 million to their institute in the years since, building an endowment that grew from an initial $50 million gift to more than $2 billion, it took years for state government and business groups to follow up.
In 2005, the Greater Kansas City Community Foundation’s Blue Ribbon Task Force chaired by former Yale University president Benno Schmidt recommended the region spend $650 million over 10 years to hire 160 new researchers and build new facilities at KUMC, in a report titled “Time to Get it Right: A Strategy for Higher Education in Kansas City,” which he co-authored with former University of Michigan president Jim Duderstadt. Schmidt’s task force issued an updated report Jan. 9, with the title “Time to Get it Right, One Year Later: Time to Get Things Done.”
Last year, a public-private partnership formed to promote one biotech specialty in the region — the development of an “Animal Health Corridor” cluster of animal health and nutrition companies — released a consultant’s report detailing the area’s attractions for industry. They include the presence of four of the top 10 global companies specializing in animal health products: Bayer Animal Health, Boehringer Ingelheim Vetmedica, Fort Dodge Animal Health, and Intervet; and combined sales by 37 animal-health companies of about $1.4 billion, or 27 percent of the nation’s $5 billion in animal-health sales.
The corridor helped the Kansas City Area Development Council, which promotes an 18-county region straddling Kansas and Missouri, draw one new company to the region. Symbiotics, the developer of tests for about 45 animal and zoonotic diseases, relocated its headquarters and R&D operations, and their combined 42 jobs, from San Diego to a 15,000-square-foot facility in Kansas City, Mo. Symbiotics also benefited from economic incentives — $1.6 million in income tax credits from Missouri, and a 10-year, 50 percent real property tax abatement from Kansas City.
KUMC hopes companies spun off from its research will also relocate within the region. Since 2004, Kansas has increased its incentives in recent years, creating a state Bioscience Authority to support research, attract new life sciences companies, and retain existing ones, using the incremental increase in all taxes except property taxes generated by new biotech companies and expansions of existing ones. That is supposed to generate $580 million over its first decade.
The authority gained unwelcome attention in recent months when its founding chairman Clay Blair resigned after the state of Kansas launched an ethics inquiry into his distributing funds to business associates and family members. Blair, a Mission, Kan., developer who did not return a telephone call from BioRegion News, has told the Kansas City Star he had done nothing improper and resigned to devote more time to his eponymous business, Clay Blair Services.
The British Are Coming
Lynn Parman, vice president of life sciences and technology development for the Kansas City Area Development Council, said a stronger KUMC can build on recent job-attraction successes she said were attributable to the presence of the medical center.
Parham cited OncImmune, which bases 125 jobs in a 15,000-square-foot facility it opened last year in Linexa, Kan., The facility is the US headquarters of a Nottingham, UK-based developer of a test for screening breast cancer well ahead of traditional mammography
“That was a great validation of the cancer research that you have in this area,” Parham said. “When you have research occurring here, you will recruit companies.”
Focus on Cancer, Bioengineering
KUMC will spend more than 40 percent of its “Time is Now” money, $331 million, expanding its KU Cancer Center. The expense reflects in part the cost of pursuing National Cancer Institute designations, first as a “cancer center” and then a “comprehensive cancer center.”
The initiative calls for the medical center to hire 244 new researchers and build 862,500 square feet of new facilities at its main campus in Kansas City, Kan., as well as its other campus in Lawrence, Kan., through 2016.
Also included is the cost of building a new facility expected to account for much of the 310,000 in new square feet of space it seeks for cancer research, “probably in KC,” Terranova said. He said the project set to break ground in four to five years, depending on the pace of fundraising.
The medical center envisioned expanding its cancer program as early as 2004, when it named Roy Jensen, formerly a pathologist at Vanderbilt University, to run it. Jensen’s program is based in KUMC’s 60,000-square-foot Lied Building, in space vacated when the medical center last January moved its liver, reproductive system, neuroscience, proteomics, and diabetes/obesity research programs into the new 200,000-square-foot Life Sciences Innovation Center.
Terranova said the expansion is being pursued to address a regional public health question: Why is Kansas’ decline in cancer deaths lower than the decline recorded for the nation as a whole?
According to United Health Foundation’s annual America’s Health Rankings for 2006, Kansas’ cancer death rate was 201.6 deaths per 100,000, based on CDC data from 2001 to 2003. That’s the same death rate as 2005, based on CDC data from 2000 to 2002. Yet during that time, its overall state ranking slipped from 20th to 23rd since the average national cancer death rate decreased from 203.6 to 201.8 deaths per 100,000 over the same period.
Worse, Kansas’ state Department of Health and Environment recorded an increase in the cancer death rate from 2004, when 193.1 deaths per 100,000 were recorded, and 2005, when the figure was 197.4 deaths per 100,000, according to its Annual Summary of Vital Statistics reports for those years.
Even before “Time is Now” was released, KU Chancellor Robert Hemenway declared cancer the medical center’s number-one research priority.
“We think this is the best way we can improve the health of Kansans and the region,” Terranova said.
The Kansas Legislature and Gov. Kathleen Sebelius agree; KUMC this year received $5 million from the state for its cancer research effort. The medical center — which receives a total $113 million in state support each year — expects to obtain the same amount of cancer money for each of the next 10 years, accounting for $50 million of the $331 million cost of cancer research expansion.
The state is expected to fund part of the $800 million sought by KUMC for “Time is Now.” Additional funds are expected to come from private philanthropists and foundations and an as-yet-undetermined share of KU’s $1.26 billion endowment.
Another key research priority for KUMC is bioengineering. Late last year KU named Paulette Spencer director of its Bioengineering Research Center, with an eye to expanding the program’s personnel and facilities. She is currently the Hamilton B.G. Robinson professor in the departments of Oral Biology and Pediatric Dentistry at UMKC, and director of its Center for Research on Interfacial Structure and Properties. She will join KU’s faculty later this summer as Deane E. Ackers distinguished professor in the School of Engineering.
As part of “Time is Now,” the medical center committed to boosting bioengineering’s current staff of 26 researchers with another 19 researchers — 10 senior, the rest junior. KUMC also envisions building a new facility to satisfy its need for 180,000-square feet of new space, but has not decided whether it should be located in Kansas City, Kan., or Lawrence.
“It’s an area we really want to develop. We see this as an area that has strong translational component, as well as a strong technology transfer component,” Terranova said.
In addition to bioengineering, KUMC would expand emerging research programs specializing in bone disorders, diabetes, heart disease, immunology/virology, integrative medicine, obesity, ophthalmology, personalized medicine, and public health. The emerging programs are expected to collaborate with Stowers and other institutions in the region, notably Children’s Mercy Hospitals and Clinics and St. Luke’s Hospital.
“We know that for Kansas City and our region to transform our economy, we must have a world-class medical center,” said Barbara Atkinson, KUMC’s executive vice chancellor and executive dean of KU’s School of Medicine, in an introduction to the “Time is Now” report.
“We know that our region will not become a top-20 life sciences center without a top-notch academic medical center. We know that the benefits of the Stowers Institute will not be captured and applied to enhance human health without the partnership of an equally strong academic medical center. We understand the challenges before us and we’re ready to take action.”