Expats Offer Ideas for Developing Biotech Here

by David Robinson

Kenmore native Peter Barton Hutt serves on the board of eight biotechnology companies, so he knows very well how those fledgling firms can't afford to waste time as they burn through their cash.

Lancaster native Terry McGuire, who now makes his living managing a Boston venture capital firm that invests in life sciences projects, understands how competitive it can be for start-up companies to raise the funding they need.

And Bruce A. Holm, the University at Buffalo's senior provost and the executive director of its Center for Excellence in Bioinformatics and Life Sciences, knows that the region's $225 million investment in life sciences won't pay dividends unless the research here develops commercially viable products.

So it's especially important for the region to lay the groundwork early on so that the advances coming out of the region's big investment in life sciences don't fall by the wayside because they got snarled in red tape and a drought of funding.

It's also the idea behind the efforts by
UB and the Buffalo Niagara Enterprise to build a network of about a dozen former Western New Yorkers with strong ties to the life sciences industry who can offer advice to local companies and maybe even open a few doors to potential investors.

Hutt, a Washington, D.C., attorney who once was general counsel to the U.S. Food and Drug Administration, says one thing the Buffalo Niagara region could do is to get the area's hospitals and life sciences groups to work together to create a coordinated approach to clinical trials.

Those trials are essential in the development of new medical products, allowing them to be tested on actual patients. The snag, Hutt says, is that each hospital typically has its own review board. That can waste valuable time and worsen the drain on a fledgling company's resources.

A better idea, Hutt says, is to create a centralized review board, that would save time and money by putting the multihospital trial through a single, consolidated review. It also would make it easier and faster for companies to find enough qualified patients by tapping into a pool of candidates at several different hospitals.

"This is a practical thing you can do," Hutt says. "The faster I accrue patients into the clinical trial, the lower my costs."

Costs are important because most of those companies won't have any source of revenue, since the products aren't ready to go on sale yet. Instead, the companies have to rely on money raised from investors, including venture capital firms.

McGuire, the managing general partner of Polaris Ventures in Boston, says really good ideas almost always attract funding. But researchers in Buffalo have to work a little harder to find funding, because the region isn't a hotbed of either venture capital or, at least for the moment, life sciences research.

"As a venture capitalist in Boston, I have plenty of opportunities that are right in my backyard," McGuire says. "The biggest issue, then, is how do I, as a venture capitalist in Boston, learn about opportunities in Buffalo?"

That's where building ties with venture capitalists like McGuire comes in. McGuire says his firm is approached by between 5,000 to 10,000 companies seeking funding each year. Probably half of those are immediately dismissed because they aren't the type of investment Polaris seeks, but just 200 to 300 make it far enough to get a closer look by the company's analysts. Of those, only about 50 get what McGuire calls "a serious look," with Polaris making an investment in only about 15 of those.

"That's where the network is so important, where someone calls me and says "Take this out of the 10,000 pile and put it in the 300 pile,' because I know them and they know that this is the type of investment that I look for," he says.

e-mail: drobinson@buffnews.com