Applied Sciences Group, Inc.

No one disputes the need to transfer technology and research into commercial products and economic development.

The difficulty has been bridging the gap between the research scientists and theorists and the entrepreneurs and device manufacturers. A group that met for the first time during a Business First Technology Roundtable hopes to continue that process with regular meetings.

The participants at the June 10 discussion were so invigorated at the end of the 90-minute session that a second date has already been scheduled, with one volunteering to host the event and three individuals volunteering to handle the logistics and planning of the group.

"If the device companies could come out and listen to some of the research that's going on with the need of the commercial possibilities, once those two then start talking then you can go out to a venture capitalist and say 'we've got this idea of here'," said E. Bruce Pitman, associate dean for research and sponsored programs in the University at Buffalo College of Arts and Sciences. "But the researchers are over here and the companies are over there and they're not talking yet."

What's going on

Though there are plenty of technology companies in the region, many have no idea what's going on in the research labs of places like UB, Roswell Park Cancer Institute and Hauptman-Woodward Medical Research Institute - ground zero for bioinformatics and biomedical research in the region. Lots has been written about the future of the bioinformatics industry in the region, but without the ability for companies to connect to that research, the region could lose out on the economic development side.

Richard Leska, special counsel at Phillips Lytle LLP, works with entrepreneurs to raise capital and maneuver past the common pitfalls to grow their business and succeed. The importance of matching local investor dollars with local companies is vital to the process, he said.

"If you have funding from outside the area that has no ties to the area and no interest in benefiting the area, then they're just looking to make a buck," he said. "There's no interest in developing jobs. One of the topics I'd like to talk about is developing local funding and also entrepreneurship. Not only helping companies grow, but creating an environment in which companies develop into industries and other service providers grow up around them. They grow off that entrepreneurship and develop this cycle."

Need for products

Bioinformatics, basically the blending of computation with biology, has unlimited applications. Norma Nowak, director of scientific planning at the UB Center for Excellence in Bioinformatics, said the computer technology industry has risen to the occasion and the local industry has plenty of opportunity to do the same.

There is a real need, she said, to determine how to link together multiple databases for analysis, such as combined hospital medical records.

"We need the core infrastructure to allow that communication to occur," she said. "It's trying to find the software that can help us make everything talk together."

The commercial applications for bioinformatics are broad. The science is being used for biodefense and dealing with dangerous pathogens, as well as things that cause chronic conditions like sinus infections in frequent air travelers, said John "Iain" Hay, chairman of the department of microbiology in the UB School of Medicine and Biomedical Sciences.

"We can develop a vaccine based on bioinformatic information we can get these days that we couldn't get before," he said. "The commercial applications are obvious."

Daniel Porreca, president of medical records firm MedWisdom, said products that will enable healthcare organizations to share information electronically are long overdue.

"Some 95 percent of the documentation about an interaction between a doctor and their patients is on paper," he said. "Bioinformatics, in my simple world, is that reverse engineering. Couple that with the historic data of what has happened and there's a powerful dovetail that can occur."

Where once this type of application seemed decades off, now it's more like a matter of years.

"Technology is at a point where we can do the computation and we see exponential growth in capabilities," Porreca said.

Organizationally, creating a computer program to manage the huge mounds of data produced by research efforts will be incredible, Pitman said.

"To bring all that stuff together and say 'we think we understand and have a good guess how to treat that person now,' that biomedical information is a huge challenge," he said. "Organizationally, we need to be able to get this information."

Funding commercialization

Those on the corporate side say they are eager to provide applications and devices and work with the researchers, but there's still a need for venture capital to fund their efforts.

"My feeling from the various meetings that I go to is there's a lot of excitement in bioinformatics and communities come up with solutions to establish initiatives in bioinformatics," said Yangzhou Wang, a research scientist at Hauptman-Woodward Medical Research Institute and co-founder of Virmatics LLC, which focuses on the development of automated and intelligent information management tools for bioinformatics in academia and industry.

"There's a lot of pressure for survival," he said. "There needs to be a fundamental change, especially with the investment people. They have a lot of business plans in front of them every week and have segments in traditional areas where they have expertise. In bioinformatics and other high-tech sectors, they don't have the knowledge or cannot assemble quickly an evaluation team to make a clear decision. People talk to me about how well your presentations are and that's the end of it."

"One thing we've found is the majority of venture capitalists are looking for revenue-stage companies and if you're not into that stage, it's pretty difficult," said Dick Engl, president of Integral Information Systems.

Sharing the vision

Those who have had success finding the dollars say it is possible to find local dollars. That's what will help bring dollars in to help commercialize ideas, said Dave Barthel, president & CEO of SmartPill Diagnostics Inc., which has raised close to $6 million in the last six years.

SmartPill's technology is aimed at diagnostic drug delivery - a $12 billion market, Barthel said.

"Those are the things that attract money," he said. "For the last four years, every decision I've made has been about, will it attract money - will a VC like it, will it attract investors."

"SmartPill is a very attractive opportunity and it's a Buffalo story. The technology developed originally at UB in the pharmacology department initially for drug delivery," he said.

That's why when Barthel goes after dollars from outside the area, it just makes sense to talk up the entire region - not just his own company.

"I leverage every opportunity I heard, talk about the Medical Campus and bioinformatics," he said. "I build a story on not only SmartPill but also on the area. We need a win. We need one lead company. Is it going to be SmartPill?,I think so. We're about a year away from that threshold."

Leska said that's the real key: Selling the vision of everything here.

"It's a vision everyone's pursuing feeding it back," he said. "Once it gets out there, then local investors will understand and it will be easier to make the sell, easier to know what you're selling toward. It should all be about that vision. This is a bit extreme, but we need to be messianic leaders trying to find disciples and try to build everyone's understanding about what we're trying to build here and what the bioinformatics and medical care infrastructure will look like five, 10, 15 years down the road. It will make it easier for everyone to raise money."

Paul Buckley, president of Applied Sciences Group Inc., said the biggest problem there with raising that awareness is the media doesn't give it enough attention. People need to see articles and watch news stories almost daily to get used to the idea that bioinformatics and bio life sciences is a growth industry, he said.

"We really need more of that and more often," he said. "It's not just roundtables like this that are going to sell it."

Continuing the conversation

Hays says it's important to take a step back, however, and first come up with some sort of business plan to make such a campaign more effective.

"We can't jump on our horses and ride off in all directions," he said. "One place you can start is to work at what strengths we already have here in Buffalo."

That's what BuffLink Inc. is trying to do, said Marnie LaVigne, project manager. She frequently meets with companies who have great ideas but just don't know the next step or how to meet the right people to help advance their ideas to the commercial level.

"The key is commercial entities pairing up with the R&D we have at UB," she said.

Porreca said raising that awareness could start with identifying a few "rain makers" to get the ball rolling, whether it's established companies like Wilson Greatbatch or Parmed Pharmaceutical or those on the verge, like SmartPill.

"What's gong to foster more investment is the successes," he said. "I'm cheering for you Dave (Barthel). There's no magic pill, but maybe there's a SmartPill."

"You've got this set of building blocks and you've already got a bunch of established companies. Hype the hell out of the ones that already exist and use that to hype the ones coming up," Buckley said. "Everything is in place but you have to act on it."

Kevin Kelly, president of TR Services, said the awareness has begun already. It just needs to continue.

"What's going to make it accelerate is the big one, the home run, and it's poised to happen," he said. "With the research and life sciences being done, commercializing that can foster it. I think there's a real good opportunity for a home run here."

The important thing is to keep going, bottom line, and actually walk the walk, not just talk the talk.

"We don't want to get stuck in what is always a typical analysis paralysis," LaVigne said.

Source: From Research to the Real World