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Horizons

ENTERPRISE

Drawn by impressive research budgets, talent, and 'serendipity,' a prodigal son returns to build a biotech oasis in Phoenix

By Mark. D. Uehling

December 15, 2003 | It started with Francie Mallery, a cancer patient. Her husband happened to be a Phoenix lawyer and dealmaker named Richard Mallery. As she died, the family oncologist, Daniel D. Von Hoff, director of the Arizona Cancer Center, told the Mallerys that physicians could not always target specific types of tumors. Basic research was needed.

As Richard Mallery recalls: "I said, 'Who's the best?' Dan said, 'Jeff Trent.' I said, 'OK, let's get him and do it.'"

Sure enough, early in 2003, Arizona lured local boy Jeffrey Trent from the National Human Genome Research Institute (NHGRI), where he was deputy director under Francis Collins.

Throw in a few consultants, add the support of an Arizona governor or two — and Phoenix suddenly had an ambitious, well-funded, 20-year plan to join the ranks of big-league multidisciplinary institutions such as the Wellcome Trust Sanger Institute, the Broad Institute, and Seattle's Institute for Systems Biology. Two new nonprofits have Mallery's fingerprints on them: the Translational Genomics Research Institute (TGen) and the International Genomics Consortium (IGC).

In concert with TGen and IGC, a host of other scientists and labs comprise a larger Phoenix life science scene of surprising vigor. "This is the framework in which contemporary biology and medicine will be shaped," says George Poste, the former research head of SmithKline Beecham who has taken over a multidisciplinary life science effort called the Arizona Biodesign Institute at Arizona State University (ASU), which will work on everything from nanotechnology to polymers to implants connected to the brain.

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ASU's professors and labs are being tightly integrated into TGen and IGC, Poste says. Other academic institutions may still school their students in traditional ways, but not in Tempe, a few miles east of Phoenix. "There is now a single school of life sciences," Poste says about ASU. "They broke down all the boundaries. Biology will increasingly become an information-based discipline. It's not for the timid."

Poste quickly concedes that ASU lacks the reputation of, say, a major gene-sequencing center such as MIT or Washington University in St. Louis. "This was not in the vanguard of leading research universities," he says. "It was not and is not. This is the start of a major transition at ASU. There is an entirely new climate at ASU in terms of a commitment to advanced research."

He says that university and individual scientists can hold equity in private life science companies — and that state funds are available to raise academic salaries to levels that scientists from pharma companies would not find embarrassing. Says Poste: "This is not an old-fashioned structure in academia."


Just Add Cash 
The first ingredient, of course, is money. Over the next two decades, Arizona taxpayers have committed $1 billion. That's about what Michigan has promised for the life sciences. But Arizona's bet is far larger than those placed by states like Pennsylvania, Illinois, North Carolina, and Connecticut. Phoenix alone has raised $43 million for a building with 170,000 square feet of lab and office space for TGen and IGC — a bill that grumbling taxpayers in other states might be in no mood to pay.

Ultimately, TGen may have 350 employees (triple its present size) to IGC's 80. If companies move to Arizona or are spun out of its universities and institutes, as many as 5,000 to 25,000 new jobs could be generated in the life sciences in the Phoenix metropolitan area. With a population of 1.3 million (sixth in the nation, expected to surpass Philadelphia in mid-2004), Phoenix is trying to keep growing, despite contractions in the tourism and semiconductor industries.

Trent, TGen's president and scientific director, is a widely published geneticist studying molecular signatures of cancer. He is perhaps best known for discovering the location of a gene that predisposes men to prostate cancer. "TGen is founded with an infrastructure that includes a series of core high-throughput technologies," Trent says, declining to elaborate on which vendors will be used.

Trent lists an impressive lineup of deals with organizations such as IBM and ASU, for high-performance computing; Affymetrix and Agilent, for gene-expression equipment; the Mayo Clinic, for patient data and tissue; the Salt River Pima-Maricopa Indian Community, for diabetes patients; and the Consortium for the Institute of Genomic Medicine in Mexico, to study diseases afflicting Hispanic people.

 With so many scientists and physicians in the region ready to help, "we have an outlet to get things into Phase I clinical trials that is just remarkable."

Jeffrey Trent, Tgen 

About the only thing Phoenix lacks is a major medical school, but there is one a few hours away in Tucson. With so many scientists and physicians in the region ready to help, Trent says, "we have an outlet to get things into Phase I clinical trials that is just remarkable."

Still, he seems leery of providing any tutorials for the benefit of other communities trying to compete with San Francisco and Boston. That's because TGen's origins can partly be found in his colleagues' 25-year friendships and Arizona roots that no regional development coordinator could engineer. "There is a serendipity quotient," Trent says. "Some of these things just come together."

None of the Phoenix backers are openly competitive; however, they let it be known that they are already welcoming visitors uncertain about the business climate in deficit-riddled states like California. "We're certainly entertaining a couple of groups," Trent says. "I'm not saying Novartis is going to make another institute and put it here. I'm not trying to slam any state." Sitting on a hotel patio, with the scent of sage and orange trees wafting through the air, he is not unaware of the practical side of the luminous high desert. Says Trent: "You can buy a house here. You can recruit here. You can get in and out of airports."


Renaissance State 
Scientifically, TGen hopes to be able to push new therapies into clinical testing quickly. TGen's chief operating officer, Dick Love, is a biotech veteran who guided Fludara I.V., a treatment for chronic lymphocytic leukemia, and Betaseron, the first drug of its class to be approved for patients with multiple sclerosis. Love sold one startup to Schering AG and raised more than $450 million in equity offerings for another.

 Now under construction: The Phoenix Bioscience Center will house TGen and IGC and provide 170,000 square feet of lab and office space, courtesy of $43 million raised by the city of Phoenix. 
Love says that the state of Arizona has committed to spend $20 million annually on TGen, approximately 30 percent to 40 percent of its optimal budget. The rest of the money will have to come from federal grants and, potentially, industry. Love adds that Trent's genomic expertise could yield more effective new drugs when coupled with working with data from the Mayo Clinic or tissues being gathered by the IGC. Which is not to say profit is the motive. "We'll make our data and tissue available to the public," Love says. "We'll put it out there."

The technological component of the Arizona renaissance is significant. Data is the major product of both TGen and IGC. IBM is helping ASU make its supercomputer one of the fastest in the world (it's number 53 on the latest Top500 Supercomputer Sites list). Trent was lured to Arizona in part after Pricewaterhouse Coopers was called in to draft a strategic plan to raise the profile of the state. A third of those being hired at IGC are bioinformaticians. "We are deeply invested in in silico," says Michael Berens, IGC's CEO.

In business terms, part of the appeal is decidedly horizontal: obtaining a steady supply of blood and tissue to analyze. The American Indians and the Mayo Clinic will help on that front. But not surprisingly, given its lure to people seeking a warm place to retire, Arizona also has a high incidence of Alzheimer's disease and Parkinson's disease, and the Phoenix institutes will be allied with a highly successful brain bank in Sun City, a self-contained retiree metropolis. The key is both logistic and cultural: The brain begins to decay hours after death, and everyone in Sun City dies within a tiny geographical radius. Equally important, Sun City has extensive tutorials (a so-called "warm autopsy" outreach program) to get elderly residents and their families comfortable with the idea of donating their brains to science.

For some of the key figures in Arizona, there is an ebullience, a confidence that may at first be a bit unexpected for weary pharmaceutical executives. A robust crop of genomically derived medicines for cancer are on the way, says Von Hoff, who is also TGen's director of translational drug development: "They're coming fast and furious. This next year is going to be dramatic." Von Hoff predicts that better selection will lead to two-thirds or even three-quarters of oncology drugs reaching clinical trials, not one in 17 as was the case in the 1970s.

Phoenix has clearly brought together experienced bioinformaticians, veteran bench scientists, and proven drug finders — and given them a small but respectable pile of money to play with. What they are about to do with those funds bears watching.*



PHOTO CREDITS NELSON BY PHOENIX BUSINESS JOURNAL



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