STRATEGIC INSIGHTSEconomic Development
Laid-back coastal-mountain lifestyle bolsters Northwestern biotech
By Barbara DePompa
May 15, 2004
In 1997, when Bristol-Myers Squibb decided to divest targeted drug therapy research efforts, Clay Siegall and Perry Fell, two Ph.D.s expert in molecular immunology, proposed a spinoff to enable them to continue their research in treating cancer with targeted drug therapies.
This move allowed the pair to form Seattle Genetics, a six-year-old biotech specializing in developing cures for cancer using tumor-reactive monoclonal antibodies (mAbs). The company recently announced a revenue jump of 200 percent, from $1.7 million in 2002 to $5 million in 2003.
Seattle Genetics uses the targeting capability of mAbs to identify and kill cancer cells while limiting damage to normal tissue. The company currently has three drugs in clinical trials and three more in pre-clinical programs. One of the furthest along, called sgn15, is a drug antibody conjugate — a product that targets a receptor on the surface of lung cancer cells. Other targeted drug therapies treat both solid tumors and hematologic malignancies, such as Hodgkin's disease and other lymphomas.
| LOOK, IT'S SUNNY: Seattle Genetics, which targets cancer cells, has grown from two to 110 employees. Quality of life attracts workers.
In addition to the busy product pipeline, Seattle Genetics derives revenue from partnerships with large pharmaceutical companies to license its antibody-drug conjugate (ADC) technology, comprised of potent drugs and linkers for attaching the drugs to monoclonal antibodies. The company currently has licensed its ADC technology to Genentech, Celltech Group, and Protein Design Labs, as well as its antibody-directed enzyme pro-drug therapy (ADEPT) to Genencor.
Both Siegall and Fell moved to Seattle from different parts of the United States. Siegall, a Washington, D.C.-area native, had also lived in Connecticut and New York but came to Seattle while working for Bristol-Myers in 1992. "In less than two years," he recalls, "my wife informed me that she and our four children would never leave."
To Siegall, the biggest plus of living and working in Seattle is the easygoing yet stimulating quality of life. "I look out my window onto Puget Sound," he says. "I leave my lovely suburban home to visit downtown Seattle in less than 30 minutes for dining, entertainment, and a variety of cultural activities."
In the past six years, Seattle Genetics has grown from its two co-founders to a company of 110 employees, a number expected to be about 150 by the end of 2005. The company currently operates out of a 64,000-square-foot facility, though it also leases some space in another nearby building.
The company, which went public in 2001, recently advised Wall Street that it expects to grow revenue by at least 20 percent per year for the next two years. "Clearly, the goal is to beat that target," Siegall adds.
Over the years, he says, there have been many applicants for each job opening, and turnover is extremely low. "Each person is handpicked after careful screening, and once they join they really seem to enjoy the exciting, entrepreneurial feel of the company. We also have an open communication style, and do many things to keep everyone in the loop."
Another attraction is the active biotech community in the region — currently eight public companies and 50 private companies, as well as world-class academic facilities such as the Fred Hutchinson Cancer Research Center, the University of Washington, Seattle Biomedical Research Institute, Benaroya Research Institute, and the Pacific Northwest Research Institute. There are also branch offices of a few large biopharmas, such as Amgen and Merck.
New draft legislation, called Bio 21, is winding its way through the state legislature to bring an additional $250 million in funding (possibly from the state's tobacco settlement) for biotech research and development. At the moment, however, Washington state ranks 46th for state funding of R&D, according to the Technology Alliance, a local economic development group.
Nevertheless, a 2002 Brookings Institute report ranked Seattle as a biotech area on par with San Diego and Raleigh-Durham, N.C., trailing only San Francisco and Boston.
From Siegall's perspective, the only downside is the relatively low number of big pharmas in the region, which tends to cramp Seattle Genetics' recruiting efforts. The cost of living, too, may induce sticker shock in prospective candidates from the Midwest. On the other hand, Siegall says, the Seattle area's cost of living appeals to new hires from San Francisco and Boston.
Yes, the region still has its long stretches of rainy days, so Siegall prefers to emphasize the temperate climate overall. "It mists quite a bit," he admits, "but you can play golf here year-round, which is a plus for players coming from the northeastern U.S."
> Snapshots from Other Biotech States