An incubator for "blue sky" research. Here's the skinny from Bio-IT World.Biogen-Idec's Innovation IncubatorBy Kevin Davies
January 18, 2007 | DELRAY BEACH, FLORIDA -- Last summer, Biogen-Idec began asking senior investigators for new ideas in ways to access external innovation. Rainer Fuchs, who has led the companys informatics group for several years, was ready for a fresh challenge.The result? The Biogen-Idec Innovation Incubator, or BI3. BI3 is a new business model in which Biogen-Idec will provide facilities, space, and money, and expertise to help scientific entrepreneurs develop new therapeutic candidates. Biogen-Idec will retain rights over the eventual product, but, as Fuchs discussed in a presentation at CHIs annual Pharmaceutical and Biotechnology Leaders Summit in Delray Beach, Florida, the partnership offers many tangible advantages for would-be entrepreneurs.
Over the years, Biogen-Idec has partnered with many groups in industry and academia throughout the pipeline. Arrangements range from collaborative inquiry “ academic grants with no strings, typically in early discovery “ to investment in new ventures with venture capital companies in preclinical stages. Biogen-Idec might invest a few million dollars in a new venture but would not be the lead investor. Investment in later-stage companies has a greater relative impact on the pipeline, but is highly competitive.
The goal of BI3 is to nurture early-stage companies in drug discovery and possibly development. Fuchs hopes to identify and target innovative lead-stage product candidates by providing funding and an entrepreneurial environment to foster original ideas.
Fuchs said the focus will be on identifying proposals that champion innovative biology with disease-modifying potential. Fuchs is looking to identify drug prototypes --- biologic or small molecule -- that are still a few years away from a potential IND. The partnership will be a milestone-driven R&D plan with a clear path to transition into development. Hes looking for an entrepreneurial founder and science team that is excited to play a leadership role. Most of the ideas will likely fall in Biogen-Idecs three major therapeutic areas: immunology, neuroscience, and oncology. The end goal is not to make money but to make key contributions to Biogen-Idecs R&D pipeline.
Take FourBiogen-Idec is offering four components in a single package: space, funding, scientific support, and business support. Fuchs explained the company would invest up to $10 million, take an equity position, and require a pre-negotiated option for product rights. Its "capping the upside," Fuchs admitted, but offers "a compelling financial return in a short timeframe. The return for us is at the end."
The BI3 shared space is located adjacent to Biogen-Idecs headquarters in Cambridge, Massachusetts. Scientific support would provide access to the animal facility, biomarkers, sequencing, NMR and crystallization facilities. In addition, there would be ad hoc access to scientists and R&D management experienced in drug discovery. As for management services, Fuchs said, "We want scientists to spend two to three years concentrating on the science, not worrying about payroll, or hiring a CFO."
Fuchs argued that the BI3 value proposition uniquely offers support for opportunities that may be too early for venture capitalists; a quick financial return; improved capital efficiency; the ability to focus on drug discovery; and an affiliation with a world-class biopharma organization.
In return, Biogen-Idec has a shot at virtualizing R&D by tapping external pre-proof-of-concept innovation, providing rapid entry into novel biologics with a direct impact on its pipeline. Biogen-Idec will maintain a disciplined investment approach, so failure to reach pre-set milestones would quickly end the program.
Fuchs said hes already received a large number of proposals, but hasnt made any decisions yet.
