We had a guest from Texas visit last night. He said he worked for a venture capital firm. After he checked out this morning we found a thumb drive he had left in his room. The following notes from a biotechnology / bioscience conference were on it. They do not look secret, so maybe if I post them here he will see them:
Feb. 17, 2009
Omni Hotel, Austin, TX
Texas Life Science Bioscience Conference
Attendance about 130
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1:30 kickoff speech, intro by David Hargrave, Chmn, Texas Healthcare & Bioscience Institute
Dr. David Rosen, Pfizer Inc.
Drug approval has changed. Before researching a new medicine, pharmaceutical companies now must make certain customer will pay for the meds. In 2007, Pfizer had 400 projects in discovery research, more than 152 molecule entities in pipeline. Now, they are reducing this span to concentrate on diabetes and endocrinology. Other medical research is just too costly and risky.
Challenges facing big pharma:
– Screen millions of compounds, spend $1B, yet after 12-15 yr. get only 1 or 2 marketable products.
– In 1960s had 10 yr of exclusivity (time to market a drug before patent runs out and makers of generics grab the market), by 1999 it was 4 months.
– Only 2 of 10 meds that reach market make a reasonable return on investment.
– Consider Lipitor, which is now nearing end of its exclusive life. Your parents paid for the previous generation of meds that created profit that paid for the discovery of Lipitor. When you buy Lipitor, you are subsidizing 3rd world buyers who pay much lower prices.
R&D of the pharmaceutical industry is increasing, now over $55B per year.
Diseases still to conquer: cancer, alzh, heart, diabetes, SARS, TB, West Nile, obesity, malaria.
To develop a new med takes a generation.
There is no guarantee of new meds. Vaccine makers went out of business due to drop in vaccine prices & legal problems (lawsuits). Recently Congress approved funding to bring them back.
We are heading down that same path in pharma industry. If we don’t save Big Pharma, our kids generation will have no new medicines.
Industry may move to China, S. Korea, Viet Nam, India. Their labor costs are 1/10 of US costs.
How to get Pfizer interested in a med you’ve discovered: 95% of good ideas come to Pfizer through someone befriending its scientist(s).
Pfizer also has molecules under development that they would like to partner with other cojmpanies to develop.
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2:00 Panel Discussion
Bill Hammond, moderator
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Patrick Kelly, Biotech Industry Organization
Now is worst financial challenge in over 15 years.
Current entrepreneur model is to find a drug and sell it to big Pharma, not develop it yourself.
Forty states face budget shortfalls, will impact Big Pharma
Bio sciences pays avg $70K salary, compared to $40K for avg employment.
Between 2002-07, 80,000 BioSci patents were awarded in US
BP (Big Pharma) needs govt funding.
TX has incubators, VCs (Venture Capitalists)
Need patience and long-term perspective
TX is targeted by BP for more Biotech.
BP needs help from Feds to weather financial climate
Rx costs are only 10% of healthcare costs, and 60% of that is generics
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Lori Reilly, Pharma Research & Mfgrs of America
SCHIP signed, President supports healthcare
Daschle’s withdrawal has slowed healthcare reform
Kansas Gov Sebelis likely to be HHS leader
All Americans should have access to quality healthcare
Need to reduce obesity, need to coordinate care, expand evidence-based medicine (but not just on cost)
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Katie Strong, US Chamber of Commerce
Want healthcare for all Americans, but want private options for insurance
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3:15 PM
Keynote #2: Richard Seline, Founder of New Economy Strategies
Prelim data on Texas & bioscience:
United Arab Emirates, China and Texas are “off the charts” for bioscience
Some medical device work is going to China
TX is big on research and testing, evaluation and clinical trials
TX gets lots of NIH funding
Baylor College of Med gets more Fed funds than any other TX institution, followed by several UT institutions (Dallas, MD Anderson, Galveston, San Antonio, HSC Houston, UT Austin)
Houston created 2000 patents, DFW 1400, Austin 500, San Antonio 470, College Station 165 over an (unclear) time period
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Biotech’s Future in TX
TX is a global competitor in BioSci…3 big reasons.
Sante Ventures is a TX VC that is moving 2 biotech companies to TX
TX Emerging Tech Fund has invested in 95 companies in 3 yr, 40 are life science co’s
Need to “get science to bedside.”
What else TX needs to do to improve:
Physical plant (facilities) and talent in Texas is very good, world class.
Need to tell people about our assets, we are still in flyover country.
Our competition (other states) are advertising better.
TX only gets 10% of capital invested in CA.
We are missing execs and entrepreneurs.
Nobody in TX knows how to manufacture protein, nobody knows about regulatory affairs.
It’s getting easier to keep investors in TX, 10 yr ago was “impossible.”
We do excellent research in TX, but don’t have infrastructure to translate research to market.
We need to find the problems then solve them, not find solutions that may not relate to any problem.
Other states w/ bad economies (e.g., California) may start exporting talent to TX.
Innovation continues in good and bad economic times.
VCs need to back winners, to train managers.
Problem: People don’t want to come here to work because, if the company fails, there is no other “backup” employer for them to work at…but, it’s getting better as more companies move here.
Problem: Univ researchers are not oriented to patenting / registering their inventions and making money.
Also, university technology transfer offices are not funded well, they get a percentage of what they license, but have a hard time getting started.
UT System is bringing all its research findings together and marketing the package to the world…very smart!
At this time it’s very hard to get early-stage money, but Emerging Technology Fund of TX has it and is giving it out…that is drawing companies to TX.
TX needs more angel (VC) funding, the TX angels understand oil and gas but don’t know how to invest in technology.
Rio Grand Valley just started their first VC fund.
TX needs large life sciences companies to “pull in” other companies.
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4:40 PM Gov Rick Perry spoke:
Is Animal Science major from TAMU
TX is only big state with budget in the black
Wants all of us to encourage legislators to fund the Emerging Tech Fund
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