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Oxford Open for Business


England benefits from critical mass of clever individuals.

By Renate Krelle

June 10, 2008 | “It's fashionable to draw Silicon Valley over a map of England," says Tim Cook, visiting professor in science entrepreneurship at Oxford's Saïd Business School.

Cook, the former head of Oxford University's technology transfer company, Isis Innovation, has been part of a prospering of high-technology companies, particularly bio-focused companies, in the green valleys of England's south east-a region which includes the counties of Oxfordshire, Surrey, and Kent.

The area has an economic output on par with Austria and Norway, according to the South East England Development Agency. Together with London, it is very much the economic powerhouse of the U.K., and both established technology companies and start-ups are concentrated in the area.

Oxford, of course, is constantly vying for top billing in the U.K. academic charts with Cambridge University, two of the corners of what is often referred to as the "golden triangle" of academic institutions in the U.K.-the third geographic point representing the University of London and Imperial College, London. Together, these institutions receive a large slice of England's higher education research funding.

The concentration of health care and device companies in the region is impressive: some 900 companies, including nine of the world's ten leading pharmaceutical companies, according to SEHTA, the South East Health Technologies Alliance. But Cook downplays direct parallels with the technology hubs of San Francisco or Boston, although he agrees that the presence of a leading university such as Oxford creates a critical mass of clever individuals to seed innovation.

"The university has an impact in that it brings useful people into the area. It provides a forum or dating service in that useful people meet other useful people. And, in the case of students, it also expands the usefulness of those useful people," Cook says.

Cook believes that as well as entrepreneurs, other personalities are essential: "In nuclear reactors they have graphite blocks which slow down the neutrons until they're going slow enough to intact with the next piece of uranium. You need a certain amount of graphite people to facilitate the interactions between the dynamic ones. They might be landlords, lawyers, and the professional classes."

Cook has observed these reactions in progress many times as an entrepreneurial culture developed at Oxford. He built Isis from a tiny office back in 1997 to a 50-strong technology transfer group today, which spins out a new externally-funded company every couple of months.

Tom Hockaday, Isis' current managing director, says the company also has a strong "open innovation" model, through both its industry networks-including the Oxford Innovation Society-and a business division called Isis Enterprise. "For the last three years, Isis Enterprise has been working with public and private sector clients beyond Oxford, helping clients develop their own technology transfer processes using our experience, networks, and skills in evaluating new business options."

Cumulative Effect
Helen Lawton-Smith, of the Oxfordshire Economic Observatory, agrees that Oxford has been the beneficiary of a "cumulative effect" of serial entrepreneurs moving to their next ventures as early spin-outs such as Powderject and Oxford Magnet Technology have matured and been taken over by large companies. "The biotech sector is growing particularly well in this region," she says. "There is a growing specialization in biotechnology within the university."

Major government funding for U.K. biomedical research comes from the Medical Research Council (MRC). In 2006, Oxford was the largest recipient of both MRC funding and grants from the Wellcome Trust. Oxford's total external research income for the 2006-7 year exceeded $500 million, more than any other British university.

The leading universities such as Oxford, Cambridge, and London generate more spin-offs than other universities. The southeast attracts 60% of the total investment from members of the British Private Equity and Venture Capital Association-$12 million in 2006. "There is still a national problem of getting later-stage finance, but Oxfordshire can't solve that itself," says Lawton-Smith.

Spinning Value
In 2000, Oxford University struck a remarkable deal to build a new department of chemistry, the first such deal of its kind in the world. In return for a $40 million investment, a publicly-listed commercialization company, IP Group, acquired the rights to 50% of Oxford's equity in spin-out companies and technology licence revenues, based on intellectual property created in department, until 2015. The pace of chemistry spin-outs has accelerated, and Isis has helped launch 11 companies, four of which are now listed on London's AIM stock exchange.

One of these companies, which recently raised $20 million from private investors, is Oxford NanoLabs, a 2005 chemistry spin-out based on the work of Hagan Baley, an expert in membrane protein engineering. The company, which is developing a next-generation sequencing platform, aims "to be to genomic medicine what broadband was to the internet," according to CEO Gordon Sanghera. "Our nanopore technology is much more elegant than existing technologies and avoids expensive and time-consuming labeling techniques."

Sanghera, an Oxford alumnus, began his commercial career at Medisense, a local blood glucose monitoring company acquired by Abbott Laboratories in 1996 for some $876 million. "Medisense created an exceptional talent pool that you can draw from," he says. "As a spin-out, you can also 'steal' some very good people coming straight out of Oxford. And we are also able to leverage places such as the Rutherford Appleton laboratories, which has a particle accelerator."

Although Oxford is ringed by science parks, Sanghera has found it difficult to the find the right "next level" of facility for the company-growing pains for the industry in the region. But at least "the proximity to London is important for access to the financial markets."

The Next Wave
Back in the labs, a new class of inventors are eyeing the world markets. Biochemist Andrew Pickford aims to leapfrog current protein analysis techniques by using an artificial intelligence technique known as "swarm intelligence" to analyze NMR data, speeding 3-D structure calculations from months to hours.

Software that provides a "color-blob" image of brain activity in real time produced by the Centre for functional Magnetic Resonance Imaging of the Brain (FMRIB), is helping assess how different brain structures are affected by drugs or disease, such as schizophrenia and Alzheimer's.

And former chair of chemistry Graham Richards, who has spun out several successful firms including Oxford Molecular in 1989, is working on an "ultrafast" molecular shape recognition software. It assists in screening potential drug candidates from huge libraries of molecules by measuring the positions of the atoms within a molecule, an approach that is orders of magnitude faster than current methods.

All of the technologies are patented and Isis Innovation welcomes interest from commercial partners.

Renate Krelle is business relationship manager at Isis Innovation. She can be reached at renate.krelle@isis.ox.ac.uk.

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This article appeared in Bio-IT World Magazine.

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