Indianapolis Business Journal gathered leaders in the state’s life sciences industry for a Power Breakfast panel discussion July 25.
Panel members included Ron Henriksen, president and CEO, EndGenitor Technologies Inc.; Elizabeth Hart-Wells, assistant vice president and director, Purdue University Office Of Technology Commercialization; and David Johnson, president and CEO, BioCrossroads. Also joining the discussion was Dr. David S. Wilkes, executive associate dean for research affairs; August M. Watanabe professor of medical research, professor of medicine, microbiology and immunology at the Indiana University School of Medicine; and Pete R. Yonkman, executive vice president, strategic business units, Cook Medical. The discussion was led by IBJ life sciences reporter J.K. Wall.
The following is an unedited transcript of the discussion.
WALL: I'll start off with kind of looking back. Earlier this year we marked a bit of a milestone in the life sciences here in Indiana with the 10-year anniversary of BioCrossroads. When that was formed in 2002, it was kind of a significant step in some of the major life sciences institutions in the state, Lilly and IU and Purdue and many others getting together and putting some resources behind encouraging entrepreneurial activity and more entrepreneurial activity in the life sciences, and I want to ask all the panelists if they can look back 10 years and say what in your mind is the biggest accomplishment that's happened in that time here in Indiana and at the same time what's the biggest challenge that remains yet to be tackled? Ron, can you kick that off?
HENRIKSEN: I would say, I don't know if it's here in Indiana only, but I think the understanding and the knowledge of the human genome, which is the base of all the things we're doing today, had to be one of the great things and now we know about the general sequence, we're able to identify individual variants, identify microRNA, which is becoming more and more important, by the way, it has your little code on the corner of your RNA that says how long you're probably going to live if you don't have an accident or something, but that's coming in very quickly, right now it's a very hot area, and we've got this thing, the transcriptionally active gene, we just understand so much more about mechanisms of how this all works than we did before. Do you want me to do challenge, too?
WALL: Sure, throw it out there.
HENRIKSEN: The challenge is you've got all of this information just coming in from everywhere, you know, the universities, companies like Lilly and Cook and so forth, so what do you do with it, how do you get your arms around it, how do you make it useful, and that really is going to be an ongoing challenge, I think. You know, the technology of the information system maybe hasn't kept up with the technology of the biology.
WALL: Who else has thoughts? David?
JOHNSON: J.K., Ron is much more substantive with his response to your question than I will be. By the way, I remember 10 years ago going to visit Ron when Ron was one of about five people who thought there might be some real potential with developing this sector here. My answer to your question would be that I think in the last 10 years we've gotten our act together and it's a pretty good act. At the BioConference, that Mr. Jones who's our representative from the state, a couple weeks back in Boston and there was a report card put out by Bio/Battelle that showed that Indiana's number 1 no matter how you rank states in the life sciences right now, number 1 in terms of the absolute number of employees, number 1 in terms of how fast the number of jobs here are growing in that sector, number 1 in the concentration of industry that we have in the state, just 1's all across the board, and there are fewer than 10 states that are in that first tier. So all of a sudden we are the envy of other states when it comes to having our act together, even though there's an awful lot of stuff we need to do, and I thought about that and I looked at that report and I recalled a time about 10 years ago when another reporter, who no longer is with the Indianapolis Business Journal, but who was very skeptical about our ability to organize anything here, got his hands on a Brookings Institution report looking at biotech centers of the US and called me up with some measure of glee and said "You guys aren't on this, nothing's going on," and I said "Just wait." So, you know, we are now, no matter whose index it is, no matter what kinds of reports you get, we are being validated all the time for what we're doing. The biggest challenge is what do we do next? You know, when you've got 1's all across the board and you're in the top tier all the way across, the next direction is not a positive one if it's down, so we need to figure out how to up our game and that, I believe, is going to involve a lot more work with the basic assets we have here, all of which are in place for tremendous growth, and a heck of a lot more smart, focused collaboration involving the industry here and academia here and we'll probably have a chance to talk more about how to do that.
WALL: Okay. Dr. Wilkes, did you have thoughts?
WILKES: Yeah, I think to Ron's point, the human genome's been a major asset and being able to map that. That absolutely gets us on the eave of really doing personalized medicine to me, really tailored medical care, the best drugs for, you know, for a particular individual's genetic makeup, and I see that overall, it's in its infancy, but I think that's going to be a huge opportunity going forward. I think on the challenge side, although we are rated very highly, as David mentions, you know, going through the new company start-up environment is pretty challenging and having done that firsthand I think the short answer of early stage capital is a rate-limiting step for us and still the monies, the venture monies, are concentrated on the coasts, there are great opportunities here, but as a community I think we need to figure out a way that we can invest in early ventures and that's not a Series A money per se but the smaller capital that would help a number of ventures get started.
WALL: Peter, Libby, do you have thoughts on this question?
HART-WELLS: Yeah, I'll answer from the perspective of more the fundamental research, not surprisingly. I have two thoughts for the last 10 years, one Ron alluded to, which is information technology, that particular field has advanced exponentially and is converging into other industries, which I think is positive. I also think that there has been more trending in the fundamental research funding for multidisciplinary work and I also think that's a positive trend that's feeding into a number of sectors, including the life sciences, who are benefiting from that multidisciplinary research.
WALL: And then can you give an example of that multidisciplinary research?
HART-WELLS: So the CTSI, we'll say, for example, is a collaboration among IU, Purdue and Notre Dame and that's a National Cancer Institute, National Institutes of Health cost-share, federal-funded program, so that converges core competencies of these three research institutes into each other to generate new ideas, new basic fundamental research that's leveraging the strengths at different universities. You wouldn't necessarily have seen that 15, 20 years ago.
WALL: And do you see another challenge ahead? If not, --
HART-WELLS: I'm in the Technology Commercialization Office, so we do nothing but see challenges.
WALL: See them every day. Pete, do you have any thoughts?
YONKMAN: 10 years ago I had been in the industry for a year, so I don't really know what I was doing back then, but I think if I look at today, though, what's interesting, I would echo some of the sentiments up here, if you have conversations -- We have conversations with people, the money people in Chicago or in New York, and they have a tremendous respect for what has been built in Indianapolis, I think as we all do, they understand what the assets here and what all of that is. I think the biggest challenge will be how do you attract money from outside of Indianapolis and from outside states to come to Indiana and take advantage of what's been built here. I mean in the last 10 years you've seen, I've seen, tremendous change and you've seen the level of sophistication of all of the various entities, whether it's government or industry or the start-up founders. That key will be to raise that profile and then to be able to get people interested to come and be a part of what's happening here in Indiana, I think.
WALL: Well, and on funding, I'm sure no one has other thoughts on funding but it came up a couple times already, the environment certainly changed a lot in the last few years, the amount of money going into life sciences, venture capital as one measurement went down and kind of bounced back up last year and seems to be going down again this year. Why is that happening and what needs to be done in Indiana to try to improve the situation as much as possible. Ron?
HENRIKSEN: This isn't a question answered just for Indiana, but I've done a lot of thinking about this and talked to several people. You know, if you look at how the industry has done, in many ways we're not as good as we thought we were going to be at this point in time. I'm old enough to have been around in about 1992, and 20 years ago, when biotech was just really starting to roll, you know, we had promises of structured-based drugs and all kinds of new technologies, no exotic -- we're not going to look at exotic plants and that sort of stuff, we're going to redesign things, and I look at today where we are and some people think that the whole industry is languishing and that's for a couple of reasons, an appalling number of recent drug candidates into the FDA have failed clinical trials, some promising new technologies that were expected to improve drug discovery have not worked as well, and on top of that then the FDA has tightened its criteria, they're taking a very, very cautious stance on things and they're not approving drugs that would've gone through quite easily four or five years ago, so we're not really sure what's all behind that, whether it's part of Obamacare or not, I'm not sure, and so many of the investors, the venture capital investors who have funded a lot of this are deserting the venture capital space for these kinds of companies and they're going with other safer returns, and the key about that is that historically the companies, and I've run three of them, that start out that way with VC money, with small ideas, if they prove out, those are the raw material for companies like Lilly and other pharma companies to replace their drugs that are going off patent with those new start-up drugs, so the whole cycle might be slowing down and I am really concerned about it.
WALL: That the big pharma companies may not have enough companies to acquire or license?
HENRIKSEN: Yeah, they've normally been pulling in great ideas and new drugs from these small guys and if the small guys are not around it's going to be a problem.