Forum: R.I. biomedical industry needs support

What could Rhode Island’s biomedical innovators accomplish if they had ready access to capital that didn’t come with a requirement to move to Route 128 or farther out of state?
What if university endowments, major companies’ pension funds and the state treasury all put even a sliver of their money into an investment fund focused on the Rhode Island knowledge economy? Some of the firms the fund invested in would, of course, fail, but others would yield good returns. And there would be a second payoff: jobs and economic growth.
That was one of several ideas proposed at the “Best and Brightest Forum on Medical Innovation,” held Dec. 14 at Brown University and co-sponsored by the Council for American Medical Innovation and the New England Biotech Association.
The event, one of several being held nationwide, was meant to gather ideas to shape the fledgling council’s agenda, with the ultimate goal of influencing the Obama administration to make policy and budget choices that promote biomedical innovation and economic growth.
The council’s chairman, former U.S. House Majority Leader Richard Gephardt, who moderated the discussion, noted that in Rhode Island alone, the biopharmaceutical sector employed more than 10,000 people in 2006, generated more than $2.3 billion in economic output and invested more than $24 million in research and development.
Across the country, Gephardt said, health care is a top employer, and medical innovation is “a way out of our economic crisis,” both because of the economic growth it generates, and because medical advances can sharply reduce the economic toll of disease.
Then there’s the human factor: Gephardt’s wife, Jane, has personally benefited from Enbrel, a biological arthritis drug made here in Rhode Island by Amgen Inc., and their son, Matt, now 39 and with two children, was diagnosed with cancer when he was 18 months old and has survived against the odds thanks to bold medical innovators, Gephardt said. The investment-fund idea came from U.S. Rep. Patrick J. Kennedy, D-R.I., who is working on a proposal to rearrange how the federal government funds biomedical research, trying to make the system less fragmented. But local money is crucial, too, Kennedy said, and while the Slater Technology Fund is doing a good job, it’s not enough.
“Rhode Island creates ideas, but investment banks take them to other states,” he said. “We need to own our medical innovation in order to create jobs here.”
Peter J. Snyder, vice president of research at Lifespan, said Rhode Island needs to promote collaboration in this sector, so individual entities are not shouldering the cost all by themselves.
Lifespan’s hospitals now attract more than $80 million per year in research funding, he said, and they are pumping nearly $15 million per year of their own money into research, and making major capital investments to expand lab space. But they face “rising pressures,” especially as the number of uninsured patients rise, so they can’t keep investing in isolation, as they have typically done in the past.
“We need to spread the risk and also spread the benefit that would come from expanding our capabilities,” he said. For example, he noted, Lifespan wants to build a new center for clinical research, and it would like to have partners in that endeavor. The demand is there, he added, citing as an example a small, local pharmaceutical firm that is now doing its clinical research in Montreal, but has $800,000 in funding for a study starting next year that could be done here.
Stephen Lane, CEO of Ximedica, a large, medical-device development firm in Providence, said it’s important not to forget medical devices – and medication-delivery systems – in these discussions, because that’s a sector with lots of potential for growth, and also a natural, new path for many local manufacturers to take as their old markets dry up. Lane also suggested encouraging different health care-related companies in the state that now have incompatible business models – CVS Caremark Corp. versus the pharmaceutical firms, for example – to test new collaborations and system innovations.
Lane and several others noted the advantage that Rhode Island has in being so compact and interconnected, with all major stakeholders readily available. Kennedy jumped on that, saying CVS in particular could be a major resource, especially given Chairman, President and CEO Thomas M. Ryan’s commitment to the state and to the University of Rhode Island.
“He’s a salesman for us, but we’re not utilizing him,” he said.
Asked what more universities could do, Dr. Leonard Bell, CEO of Alexion Pharmaceuticals Inc., in Smithfield, said creating more ready-to-use lab space would be a big help.
But Bell and others also stressed that national-level policies are crucial to the success of biomedical innovators. All the miracle drugs in the world are worthless, for example, if insurers’ annual and/or lifetime benefit caps put them out of patients’ reach, he said, so well-crafted health insurance reforms must be passed.
And Stephen Evangelista, president and CEO of the Arthritis Foundation of Northern and Southern New England, which he said invests about $2.1 million per year in research, said a 12-year, data-exclusivity period for biological therapies must be granted.
Enbrel, for example, was “a truly life-changing innovation,” he said, and if the federal government doesn’t give companies like Amgen enough time to recover their R&D investment, it’ll stifle future innovation. &#8226