Presented in the midst of a sharp economic recession, the 2009 conference of the Arizona BioIndustry Association (AZBio) was fittingly marked by tales of ingenuity, teamwork, endurance, and triumphs over long odds.
Biozona 2009, which took place April 7 at the new Sheraton Phoenix Downtown hotel, featured keynote addresses from Larry Mehren, chief financial officer of Oro Valley’s Ventana Medical Systems Inc., and Roger Newton, president and CEO of Michigan-based Esperion Therapeutics Inc. and co-discoverer of the blockbuster drug Lipitor. Both Mehren and Dr. Newton devoted portions of their addresses to describing the intricate, high-stakes negotiations that led to their firms completing billion-dollar deals with giants in the pharmaceutical industry.
Also highlighted at the conference, which was attended by over 250 members of Arizona’s bioscience community, were data from a new Battelle study on the economic impact of the state’s bioscience sector. Walter H. Plosila, senior advisor for Battelle’s Technology Partnership Practice, reported that in 2007, the year offering the most recent data, the biosciences generated $12.5 billion in revenues and accounted for more than 87,400 jobs, while contributing more than $765 million in state and local taxes.
“Between 2002 and 2007, economic activity within the bioscience sector increased 57 percent, jobs 20 percent, and tax revenues 35 percent,” Dr. Plosila said. “This rate of growth is difficult to find elsewhere in the nation.”
“If we continue to promote policies that encourage the growth and success of private-sector bioscience companies, Arizona will continue on its path toward becoming a recognized center of excellence for this global industry,” said Bob Eaton, AZBio president and CEO, in the Phoenix Business Journal.
The conference also included several breakout panel discussions with research, industry, and public-policy experts; company showcases where firms introduced their business models and technologies; and an exhibit hall featuring 28 bioscience-related organizations and companies.
Mehren, delivering the conference’s morning keynote address, provided a behind-the-scenes account of Ventana’s transformation from a University of Arizona professor’s idea for a new diagnostic tool into a publicly traded company valued at $3.4 billion in an acquisition last year by Swiss biotechnology giant Roche Holding AG.
Mehren’s remarks focused on the two individuals he described as most responsible for Ventana’s success: Thomas Grogran, the UA cancer pathologist who invented the automated slide-preparation device that became Ventana’s first technology platform, and Christopher Gleeson, who, Mehren said, brought visionary leadership to the company when he became its president and CEO in 1999.
“A discussion about Ventana is a discussion about people,” Mehren asserted. “Tom faced rejection after rejection” as he sought funding to launch Ventana. “The fact that he continued to quit formed a basis for the company.”
When Gleeson arrived as CEO, Mehren said, a “lack of leadership had led the company to lose its way, and Dr. Grogan had decided to leave the company. Chris’s first decision was to bring back Tom Grogan.”
As Ventana became a rising player in tissue-based diagnostics over the next several years, it began drawing attention from major pharmaceutical companies, and in 2007 Roche initiated a hostile takeover bid. “No matter how well prepared you are, things still move fast,” Mehren said.
Over the next several months, he and Gleeson crisscrossed the country, meeting with wavering shareholders and working to cement the perception that Ventana was worth more than Roche had offered. “We decided we were sellers,” Mehren said, but at the right value.” The sale of Ventana for $89.50 per share, he said, met their internal standard.
Dr. Newton’s midday address recounted his own career path from his chairmanship of Parke-Davis and Co.’s Atherosclerosis Drug Discovery Team, through the founding of Esperion Therapeutics Inc. in 1998, to its acquisition by Pfizer Inc., and to Esperion’s return to independence in 2008.
Despite the success Dr. Newton’s team had enjoyed with the discovery of the cholesterol-reducing drug Lipitor, he recalled that “the lack of follow-up blockbusters prompted increased merger and acquisition activity,” on the part of Parke-Davis’s parent company, Warner-Lambert Co. In restructuring, Dr. Newton said, Warner Lambert’s research-and-development operations were upended.
In leaving Warner-Lambert to launch Esperion, Dr. Newton said, he wanted not only to pursue new drug candidates, but to return to his roots. “The road to innovation,” he told conference attendees, “leads you back to the basic science.”
That inclination to place highest value on the pursuit of research discoveries remained with Dr. Newton even after Esperion was acquired by Pfizer–which now owns Lipitor–in 2003 for $1.3 billion. So when Pfizer opted to shut down a substantial portion of its research on cholesterol-lowering agents, Dr. Newton opted to restart Esperion as an independent company again, oriented around development of a lead small-molecule compound that inhibits fatty-acid and cholesterol synthesis. Pfizer holds an equity position in the company still, but Esperion is otherwise functioning like many other startup firms–seeking venture-capital funding and operating with a small staff of scientists.
“We’re dedicated to discovering new therapies through vibrant teamwork and excellence in science,” Dr. Newton said. “I realized at 24 that I loved research. With Esperion, I get to live that love.”
Eighteen firms with their sights set on the kind of run that Dr. Newton has had were represented at Biozona 2009 in three company-showcase sessions. The firms were: Transmed Oncology Inc. of Cave Creek; TR BioSurgical LLC of Chandler; C-Virion Corp., HumaGene Inc., MedApps Inc., and TGen Drug Development Services LLC of Scottsdale; Applied Microarrays Inc. and Intrinsic Bioprobes Inc. of Tempe; Amplimed Corp., LiPoint Inc., Luceome Biotechnologies LLC, MSDx LLC, and Vaxx Inc. of Tucson; and ApopLogic Pharmaceuticals LLC, KromaTiD Inc., NeuroQuest Therapeutics, Pharmatech Oncology Inc., and Quest Product Development Corp. of Colorado.
Both in terms of presenting and exhibiting companies, and conference attendance, Biozona 2009 set new highs. Nina Ossanna, director of business development for the BIO5 Institute at UA, and vice-chair of AZBio’s board of directors, noted the substantial growth the annual conference has enjoyed over the past several years.
“Back in 2002, we were out in the parking lot of the DoubleTree Hotel in Tucson,” she said in remarks to conference attendees. “People have worked hard to make this statewide organization a success.”
For more information:
“Report: Arizona biosciences contribute $3.6B,” Phoenix Business Journal, 04/07/2009