We often talk about innovation in terms of science and technology, but in today’s healthcare ecosystem, it’s just as important to innovate on the business side of things.
That’s what the $250 million Harrington Project for Discovery & Development, a national initiative based at University Hospitals Case Medical Center, is trying to do. It comprises nonprofit and for-profit entities aimed at helping new developments in biotechnology cross the “valley of death,” which lately has become more of an “uncrossable canyon,” according to Baiju Shah, the CEO of BioMotiv, the for-profit side of the project.
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Shah, who left his post as head of Northeast Ohio life sciences trade group BioEnterprise earlier this month, gave his first public presentation in his new role at the BioOhio Regional Annual Conference in Cleveland on Thursday.
“You can’t find VCs who are interested in a therapeutic coming out of a university or institution,” he said.
That’s because early stage biotech VCs as a group have not earned a significant return on their investments, he said, and those who have survived are investing later stage after phase 1 data is available. The Harrington Project is employing a novel funding model to accelerate research through early development stages to a point where it could attract commercial interest.
The Harrington Project has three components: the nonprofit Harrington Discovery Institute and Innovation Support Center, and for-profit BioMotiv.
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The discovery institute will provide 10 “scholar-innovators” per year with $200,000 and industry guidance to help them develop their discoveries. So far, Shah said, the institute has received 129 applications and will announce its first class in November.
Additional funds of up to $500,000 would be available for some inventors whose developments show promise through the Innovation Support Center, which would also help them establish relationships with industry experts and entrepreneurs to prepare their discoveries for commercialization.
Then BioMotiv comes in. Shah emphasized that BioMotiv doesn’t work like a venture firm or pharmaceutical company trying to bargain with a startup. Rather, it wants to in-license inventors’ technologies and use its own leadership team to move the discoveries into phase 1b/2a clinical studies. After that, they would be ready to out-license the technology to pharmaceutical companies or VCs, with some of the profits being reinvested in the company.
BioMotiv has raised $21 million so far, but plans to raise $100 million in capital.
The team has already selected its first technology and hopes to announce about a half dozen technologies by December, Shah said.
“If you don’t innovate into the for-profit side, you’ve taken a project further into the canyon and left it there,” he said.
[Photo from Flickr user bdearth]
