Adding New Life To Va.'s Economy
Science-Business Partnerships Stimulate Biotech
Growth
Terence CheaWashington Post Staff Writer
June 4, 2001; Page E1
For much of the past five years, Maryland
economic development officials watched with
quiet envy as Virginia's Internet industry took
the state, especially Northern Virginia, on a
historic growth spurt.
Now, Virginia is trying to be more like
Maryland, undertaking a statewide effort to
graft the best aspects of its neighbor's
thriving biotechnology industry.
As financial troubles force many formerly
high-flying Internet and telecommunications
companies into bankruptcy, Virginia government
officials, business executives and investors
believe biotechnology can be a major part of the
state's economic future.
"They're looking for the next big
thing," said Jerry Coughter, director of
biotechnology and medical applications at the
Center for Innovative Technology in Herndon.
"A lot of very smart people are looking
around and saying biotechnology is where we
ought to be."
Across the commonwealth, from Reston to
Blacksburg to Richmond, they are building
research institutes, office parks and business
incubators focused on nurturing biotech
start-ups and drawing outside firms to the
state.
In Northern Virginia, officials hope a new
research campus Howard Hughes Medical Institute
is building will attract more
scientist-entrepreneurs and create the spinoff
effect that has fueled other biotech clusters.
In Richmond, the Virginia Biotechnology Research
Park is expanding and planning a satellite
campus in the suburbs. And in Southwest
Virginia, Roanoke is building an urban research
park for new biomedical companies, and Virginia
Tech in Blacksburg is creating a biotech cluster
focused on genetically engineered plants and
animals.
Biotechnology has also caught the attention of
government officials in Richmond. Last year, the
government invested nearly $12 million to help
launch the $39 million Virginia Bioinformatics
Institute at Virginia Tech. In May, the state's
Commonwealth Technology Research Fund handed out
$7 million in grants to fund biotech-related
research at several universities.
Virginia is slowly beginning to emerge from the
shadow of Maryland, whose biotechnology sector
has gained international recognition with the
recent mapping of the human genome and the
celebrity-like success of such companies as
Celera Genomics Corp., MedImmune Inc. and Human
Genome Sciences Inc. Maryland has more than 300
bioscience companies, employing about 16,000
workers.
When factoring in large out-of-state employers
such as Merck & Co. and American Home
Products Corp., Virginia's life science sector
is not much smaller than Maryland's. The state
has about 200 life science companies employing
about 15,000 workers, Coughter said, though they
tend to be scattered around the state rather
than clustered together.
Maryland's biotechnology industry attributes
much of its success to its world-renowned
federal laboratories and research universities,
such as the National Institutes of Health in
Bethesda, the University of Maryland and Johns
Hopkins University.
Likewise, Virginia is trying to leverage the
brain-power and research talents of its own
universities to create biotech clusters. The
state is drawing on the University of Virginia's
medical knowledge, George Mason University's
computing expertise and Virginia Tech's research
capabilities in agricultural biology and
computer science.
Virginia also faces many challenges to its
biotech ambitions. It must persuade venture
capitalists to invest in a sector that's
perceived as risky, expensive and complex -- and
one that lacks Maryland's stature. It must
develop a workforce with the skills demanded by
biotechnology companies. And it must build the
highly-specialized laboratory facilities
essential to biological research.
Cel-Sci Corp. of Vienna understands just how far
Northern Virginia needs to go before it can be
compared to Maryland. The cancer-drug developer
has its headquarters in Virginia, but it runs
all its research, development and manufacturing
operations in Baltimore. Only seven of its 40
employees work in Vienna because the company
can't find the lab facilities or skilled
researchers it needs there, said Geert Kersten,
the company's chief executive.
"Northern Virginia doesn't have the
infrastructure to develop pharmaceutical
drugs," Kersten said. "For
product development companies, there's no reason
to come to Northern Virginia, except for the
quality of life."
As biotechnology becomes an increasingly
computer-driven industry, Northern Virginia sees
a future in the emerging field of
"bioinformatics," the use of
information technology to store and analyze
complex biological data.
The region sees an opportunity to develop
software and data management tools to help
biological researchers make sense of the
unprecedented amount of human genetic
information in public and private databases.
"There are many skill sets that are
critical to both biotechnology and information
technology," said Mark Herzog, executive
director of the Virginia Biotechnology
Association.
Meanwhile, some Northern Virginia counties are
developing incubators to nurture biotech firms.
In Fairfax County, government officials recently
approved funding to build an incubator for
bioinformatics start-ups in Springfield. Prince
William County is also considering a bioscience
incubator even as it tries to attract more
biotech companies to its Innovation@PrinceWilliam
technology research park in Manassas, near
George Mason University and the American Type
Culture Collection, a nonprofit repository for
cell lines, microorganisms and other biological
materials.
One example of the kind of company officials
would like to attract is LabBook Inc., a McLean
company founded last year to develop software
for biological research. Its flagship product,
the Genomic XML Browser, allows researchers to
analyze and graphically display genetic data.
"The problem is pharmaceutical and
biotechnology companies are overwhelmed with
different types of data sets," said Shawn
Green, LabBook's chairman and chief executive,
who previously served as vice president of drug
discovery at Rockville biotechnology company
EntreMed Inc. "We provide the researcher
with the tools to integrate that data in a
meaningful way.
Northern Virginia's biotech ambitions got a
major boost late last year when the Howard
Hughes Medical Institute, one of the world's
premier medical research institutions, announced
it would spend $500 million to build a
bioinformatics research campus on 281 acres in
Loudoun County. Officials hope the campus will
become a hub of scientific and entrepreneurial
activity that spins off companies and draws life
sciences firms to the region.
Richmond's biotechnology ambitions center around
the Virginia Biotechnology Research Park, which
occupies 34 acres downtown, next to Virginia
Commonwealth University, the region's major
research university.
The park, founded in 1992 as a joint venture
between Virginia, the city of Richmond and
Virginia Commonwealth University, was launched
to nurture biotech start-ups. It has a mix of
tenants including firms developing drugs,
medical diagnostic devices and tissue
engineering technology. The park has given rise
to Richmond's three publicly traded biotech
firms: Insmed Inc., Commonwealth Biotechnologies
Inc. and Allos Pharmaceuticals Inc.
"Many folks tend to think of Richmond as
the state capitol and a traditional
manufacturing town," said Robert Skunda,
the park's president and chief executive.
"We've also seen the tremendous growth of
technology companies."
With six completed buildings and two more under
construction, the park has about 600,000 square
feet of space, representing about $150 million
in investment. When it is complete, the park
will have cost $500 million, will have 1.9
million square feet of space and will employ
3,000 workers, Skunda said.
Earlier this year, the park struck a deal with
neighboring Chesterfield County to build a
satellite campus on 325 acres on the banks of
the James River, about 10 miles from downtown
Richmond. They hope to attract outside companies
and give more space to homegrown firms that
outgrow the downtown park, Skunda said.
"This region as a whole is beginning to
embrace the life sciences and biotechnology as
its economic future," Skunda said. But he
said Richmond must work harder to attract
entrepreneurs and venture capitalists to the
region. "If we're going to build
biotechnology, we're going to have to enhance
the attraction of investors."
In Roanoke, economic development officials are
trying to create a new generation of biomedical
companies to revitalize an economy dominated by
health care, transportation and manufacturing.
In November 1999, Virginia Tech, the University
of Virginia and Carilion Health System launched
the Carilion Biomedical Institute, an incubator
that seeks to help entrepreneurs bring new
medical technologies to the marketplace. The
institute aims to "accelerate the
transition of research into products that
benefit health care and create economic
development opportunities in southwest
Virginia," said Dennis Fisher, the
institute's president and chief executive.
With an initial $20 million investment by
Carilion Health System, the institute is
developing products in the fields of medical
robotics, laboratory automation and diagnostic
tools. Earlier this year, Carilion launched its
first company, BioPhile Inc., which makes
high-tech automated laboratory freezers to store
and retrieve medical tissue, blood and DNA
samples.
The city of Roanoke has planned a 110-acre
research park that it hopes will transform its
dilapidated south side, which is occupied by a
cement factory, scrap yard and storage
warehouse. The Riverside Center for Research and
Technology will be built with $174 million in
several phases over the next 15 years.
"We want to create high-quality jobs in
this region, and we see biomedicine as an
industry of the future," said Elizabeth Neu,
Roanoke's director of economic development.
In Blacksburg, Virginia Tech is working on
bioinformatics and agricultural biotechnology.
The Virginia Bioinformatics Institute now
employs 25 researchers in such disciplines as
physics, mathematics, biology and engineering,
working together to solve some of most difficult
problems of computational biology. The institute
plans to double again next year and eventually
employ 200 to 300 researchers. It hopes to
attract biotech firms to the region, spin off
companies and form partnerships, such as its
recent agreement with Sun Microsystems Inc.,
said Bruno Sobral, the institute's director.
Blacksburg is also home to several firms that
specialize in developing genetically engineered
plants and animals, including CropTech Corp. and
the U.S. subsidiary of PPL Therapeutics PLC, the
Scottish company that created Dolly the cloned
sheep in 1997.
CropTech, founded by Virginia Tech professors
Carole Cramer and David Radin in 1992, is
developing tobacco plants that have been
genetically altered to produce human proteins
when cut. The company hopes the plants could be
used to mass-produce biological pharmaceuticals
to treat human disease.
