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President's Q&A, February 2015
February 23, 2015
Dr. Perman held a group Q&A on Feb. 23 at the School of Pharmacy. The session included a presentation by James L. Hughes, MBA, chief enterprise and economic development officer, vice president, and director of UM Ventures, on UMB’s role as an economic engine in the state. Excerpts of that and questions and answers that followed appear below.
Dr. Perman: Thank you for coming to the Q&A. You may have been admiring the photography behind me. These are the winning entries in the Snap photo contest. Some of the winning photographers are here with us today. Please stand up to be recognized. You do lovely work.
One of the things I have tried to do each Q&A is to begin with a topic. Today’s is economic development, what we’re doing with community, what we’re doing with the BioPark. It’s one of the areas that really distinguishes this campus and I think makes our future bright. I’ve asked Jim Hughes, our vice president in charge of these matters, to update us.
Mr. Hughes: When you think of economic development, the core traditional activities of the University are really the key drivers. Certainly educating all the people we do and the research we do and just being one of the largest businesses in Baltimore City all have a tremendous impact. What I am going to focus on today are just a couple slices of that — what we’re doing in the community surrounding us and what we’re doing with industry, particularly biotech and pharmaceutical companies.
I borrowed the title of this talk, “Entrepreneurial Culture Boosts Business,” from a recent op-ed.piece that Dr. Perman did in The Baltimore Sun.
East of Martin Luther King Boulevard is an area that we are branding, to a certain extent, UniversityCity. This is a partnership that Dr. Perman and the mayor formed a few years ago and they co-chair a committee. Unlike a lot of committees that start with enthusiasm and then die off, this has been going strong and really picking up steam. The initial focus was on security.
Looking at the Lexington Market area, we really have three police forces there — University, Baltimore City, and MTA. They’re coordinating with one another and their efforts have dramatically brought down crime.
How many of you are aware we now have the Bromo Arts District? In this area near the heart of the campus but slightly to the east with the Hippodrome Theatre, we now have the Everyman Theatre. We have received, from the city and the state, designation as an arts district. This is beginning to pick up momentum.
We also have projects that are just beginning. Kathy Byington and Angela Fowler-Young have been working hard with the University properties. We have about a dozen or so properties that the University has purchased over the years and are in need of repair. Kathy is working with a private developer who will hopefully be developing, in fairly short order, Drovers Bank and Sons of Italy. This is a key block between the Hippodrome Theatre and Lexington Market.
Lexington Market is the big push right now. There’s been some coverage in the press of doing a major revitalization of the market. I expect in the next three to six months we’ll come back with some plans there and get your input.
To the west of Martin Luther King Boulevard, Southwest Baltimore has come together with a coalition of community leaders. They have come to the University, to the medical center, the Goldseker Foundation, and several others and said we need your help to look at this area. So it’s the seven neighborhoods just to the west of us. The University helped fund a master plan that’s focusing on residential development in that area, also looking at various neighborhood parks and really trying to drive retail around Hollins Market, which is a smaller version of Lexington Market, B&O Railroad Museum, and just along Baltimore Street there.
Now let me talk about the BioPark. A lot of the attention for the BioPark is on buildings. Today, I’d like to focus on some of the collaborations. We have about three dozen tenants in the BioPark, small companies, large companies, we have a number of startup firms there. Just to highlight a couple of these, Gliknik was co-founded by Scott Strome in the medical school. In addition to developing his technologies, they’ve raised $50 million to develop Dr. Strome’s technologies. They are also funding research in three other departments in the University, both in the medical school as well as the pharmacy school.
PathSensors – a company in the BioPark that started off being unrelated to the University — has recently won a state grant and partnership with a faculty member of the University. Advanced Metrics is a startup company coming out of our Department of Psychiatry. Ocular Proteomics – people there now have faculty appointments in the University. There are increasing numbers of collaborations there.
We also have what are called contract research organizations. Actually, this is where some of our biggest collaborations have come in. Paragon Bioservices has 125-130 workers in the BioPark and they’re looking to double that over the next two years. They have teamed up with the University to apply for a number of federal grants including about two years ago we won a $15 million grant with the Department of Defense. Paragon has a GNP biomanufacturing facility probably about the size of this room, which cost millions and millions of dollars. By teaming up with University faculty, we are getting access to that and we’re also winning federal funds.
SNBL is another example. They have a 96-bed clinical trial unit. The Center for Vaccine Development in the medical school has run over a dozen NIH-funded clinical trials there. Those clinical trials have brought in over $50 million to the University.
A local benefactor, John Hussman in Howard County, created the Hussman Institute for Autism. They’re in the process of recruiting 20 top researchers from around the country. Half a dozen of those researchers already have joint appointments at the University and now are applying for federal grants with us.
We have also been fortunate to have private developers who have invested a tremendous amount of money. We’ve got a great building going up across the street (HSF III) and you sort of think of the 10-year process of getting money from the legislature to do that, which is great when they give it to us. Here we have had comparable amounts or even more money invested by the private sector in helping to build the BioPark. So Wexford has invested $140 million and they plan to invest another $110 million.
The Maryland Proton Treatment Center is a $200 million facility. Bill Regine, chair of Department of Radiation Oncology, has already applied for well over $100 million in federal grants. So, we’re getting the private sector to invest in the community but it’s also helping us to expand our research activities.
Going beyond the BioPark – corporate-funded research represents just under 10 percent of the total funding that we have at the University. We added about $10 million in corporate funding in FY14. One of the ways we’ve done that is our Center for Clinical Trials has been very busy negotiating master agreements with private companies. We have over 30 master agreements. By having a master agreement with the company means that when there’s a new research project with them we don’t have to negotiate a new agreement.
I’d like to emphasize Medimmune a little bit. Part of what we’re trying to do is have more strategic relationships. If you go back just two years ago, Medimmune sponsored only $100,000 of research at the University. In FY14, it was over $800,000. They’ve committed to spending a minimum of $6.5 million over five years. We’re already on a path to be substantially more than that. Some of the initial projects that they’ve selected and we’re working on, Bob Ernst in the School of Dentistry, working with Dave Goodlett here in pharmacy. We also have a very exciting project with Sunjay Kaushal and the School of Medicine.
One of the ways that we’ve started to reach out more strategically to companies is by having industry liaisons, people from industry who are teaming with our faculty to develop these types of relationships. Thanks to a referral from the School of Medicine we have a former vice president from Bristol Meyers Squibb who’s working with us to make this happen.
Allow me to provide a couple examples of the impact we are having. Some 3 million to 5 million people a year get cholera. Over 100,000 people are still dying of cholera. That incidence is increasing unfortunately. It’s very prone to very severe epidemics. When there was the earthquake in Haiti, you had a big ballooning of cholera there. Right now there’s no vaccine in the U.S. and the other vaccines that exist in the world take two doses. If you think back to Haiti, our University was great and responded. We had a bunch of people from Shock Trauma who went down there. They were unprotected from cholera. So in the U.S., we think of first responders, military troops, also travelers. We have a bunch of people from this University going to areas around the world that are prone to cholera.
Coming out of the Center for Vaccine Development we have a cholera vaccine that has just completed phase three clinical trials and they are submitting an official request to the FDA for the approval to sell this. It would be the first vaccine approved in the U.S. and it would be a single dose. We hope within the next 12 months that this will be on the market.
Tokai is one of our more high-profile startup or early-stage companies. It is developing a drug to treat prostate cancer. Treatments for prostate cancer have improved but still one out of 36 men will die of prostate cancer. One out of seven will get it. Tokai has completed phase two clinical trials. They have raised $150 million, $98 million of that just a couple months ago through an IPO. We hope that in the next several years they will have a new drug to treat prostate cancer on the market that was invented here at the School of Medicine.
These are a couple of the newer deals we’ve done. Close to 7 million people in the U.S. suffer from mitral valve regurgitation when a heart valve is not working properly. In order to fix that right now you need open heart surgery. It’s cracking open the chest, going on a heart bypass machine, shutting down the heart, and it’s a three- to six-hour surgery. You’re in the hospital for a week, you’re out of commission for a month. Because it’s such a dramatic surgery a large percentage of people who would benefit from the surgery aren’t getting it.
So, Jim Gammie in the School of Medicine has developed a device that would result in minimally invasive surgery that would take less than an hour. You’re not breaking open the chest, there’s no bypass, the heart continues to beat, and you’re out of the hospital in a couple of days — dramatically decreasing the cost of the surgery, decreasing how traumatic it is and also increasing the number of people who would be eligible for it. This device is going to be in clinical trials in the next couple of months in Europe. We hope it will be available for patients in the U.S. within the next several years.
Also developed out of the Department of Surgery, by Bart Griffith, is looking at a way of dealing with lung deaths. Actually, over 200,000 lung deaths, and these are non-cancer in the U.S. Right now their treatments are very, very limited. Usually, it is putting them on a ventilator, which is very rough on the lungs. There’s a chance of stroke and infection and it’s also very expensive. What Dr. Griffith has developed is a very portable device similar to pulling a suitcase at the airport. This might not seem to be ideal but it certainly beats being tied down to a hospital bed in the ICU. So, early stage. We’ve got a ways to go with this one but are getting very good traction.
And you don’t need to be working in a lab or working as a surgeon to come up with an idea. We had a group of people in the Department of Diagnostic Radiology dealing with a whole bunch of software issues. You have multiple information management programs and they don’t talk with one another and you’ve got data in one system and other data in another. So the group in radiology put together essentially an overlay that pulled information from all these different systems. They have built a company around that. We all come up with these back doors and these fixes that aren’t done with the existing software programs. They found people at universities all across the country are doing this. They have now created a consortium, AI Bridge, Analytical Informatics, that’s similar to an app store.
The ideas for some of these inventions can come pretty much from anywhere. I think anybody in this room if they thought about it have something that potentially could make it to the market.
We have about 165 active licenses out there in the market. I have highlighted about half a dozen or so. We have had a huge increase over the last several years. Phil Robilotto is here. He came on about three years ago. Dr. Perman supported our office about three or four years ago so we’ve been able to build up the staff. We’ve had a big increase in invention disclosures. This is faculty, staff, or students saying I’ve got an idea that might be something. Then licenses are when we sift through all those ideas and then we take them to a private company and license them. We’ve had very good increase over the last couple of years.
Let me just touch on that process. We start with the invention. The first thing we do is a technology assessment. We look at is that patentable? Does it have good, strong science? Is there a market for it? We sift through those three areas and we decide what to do next. Typically, we’ll file an initial patent protection on that.
We also start marketing, going out and identifying those companies most likely to have an interest in that technology and we start contacting them. But a big part of it is the technology development. So as neat as your idea might be at that early stage it’s probably not quite where it needs to be for a company to leap in and invest millions of dollars to develop it. So, we spend a fair amount of time focusing on the technology development.
Hopefully, if we’re all successful, we have a technology license. This probably happens about a third of the time with the ideas that come in.
Final slide. We have been focusing a lot of attention on building up our relationship with College Park and both the entrepreneurial programs that they have within their business school and their engineering school but also, I think much more significantly, looking at the research expertise they have. So we’ve got great programs in genomics. They have great computer sciences. Bringing those together. We have great uses of physics with radiation therapy or radiology. They have a wonderful physics department. Bioengineering, brain science, big new initiative focusing on sports medicine. We’ve got the medicine, they have the sports. We have people at both campuses. We call them site miners who are working together to make those connections between the faculty.
There are a lot of great ideas out there. We’re probably just scratching the surface. If you could help us to spread the word on the opportunities out there we would greatly appreciate it.
Dr. Perman: Thank you, Jim. Look, why do we do all this? Why do we concern ourselves with making the Westside of downtown revitalized, working with our communities to the west, having the dynamic BioPark? We do it because this University is obligated to do it but it also ensures our future as a great place to work, an exciting place to be, an institution on the move. That’s why I want you to have this information. Are there questions or comments for Mr. Hughes?
Q: Before I came to the School of Nursing last semester I was involved with a startup in Annapolis. We had a medical device. We were funded to about $3.5 million so the Harpoon Medical example with Dr. Gammie caught my eye. I’m curious to know, where will the next $100 million come from to make Harpoon successful? I’m new to the UM Ventures idea and also do you ever take outside inventions in-house and bring them to the next level?
Mr. Hughes: The money comes from the private sector. The state and the University can put a little money in initially, but that caps out pretty quickly. Harpoon has raised $3.6 million, similar to the startup that you were involved in. Of that, $100,000 came from the University and the majority of it came externally. Then it’s really relying on the private sector to get to the next stage.
Q: I’m from the Center for Translational Medicine at the School of Pharmacy. It might be interesting to find out what private industry is interested in sponsoring and to have some kind of forum where we could invite industry leaders as well as venture capitalists to the table and meet with people on campus who have ideas.
Dr. Perman: That sounds like an excellent idea. Jim, we’ve done a little of that but we probably could do more.
Mr. Hughes: We certainly would be eager to work with you to help highlight what you’re doing to other companies.
Dr. Perman: I think industry, based on travels that Jim and I have had, would be very eager to come and interact face to face. It was one of the reasons I wrote that op-ed for The Sun. We need to do much more with these opportunities, much more with these partnerships. As you know, the climate in the state is right for this as well. So, thank you for your suggestion.
Let me pick on Chief Williams for a minute. How do you think things are going, sir?
Police chief Antonio Williams: Actually, we do have good news because all of us certainly had some serious safety concerns about last year. As you know, we put some things in place to try to mitigate those incidents and certainly help everyone feel safer. I thank you all because we’ve gotten a lot of excellent feedback about the services that we’ve been providing. Last year at this time, we already had four robberies. This year we had one. We will strive to keep that up.
Peter Murray, chief information officer and vice president: Just to follow up on security, I’d like to talk about information security and information security awareness. You may know that there are millions of attempts made every day to get unauthorized access to our network and to your machine. There is evidence of greater security awareness at UMB, since our records indicate fewer incidents of individuals clicking on links in emails sent by people they don’t know, and giving out their username and password. I would like to thank you for being diligent and careful, and for your help in protecting our University data. We really appreciate your efforts with information security. Thank you very much.
Q: I thought a lot more hands would have gone up by now. I’ll go ahead and break the ice. First of all, the University needs to be commended for trying to deal with the first set of state cuts, by dealing with the hiring freeze and the deferred maintenance. That’s very honorable. Some of those cuts still found their way to our departments. I’m wondering if you wouldn’t mind commenting on the governor’s proposed claw-back of the COLA?
Dr. Perman: Thank you for the question and for the points about how we’re dealing with this here. But let me first say that I want to make sure that everybody understands that there’s the balance of this year and then there is the governor’s proposed budget for next year. One of the reasons that we made the decisions we made, namely dealing with hiring, dealing with deferred maintenance, none of which is pleasant in itself, is that other solutions would be one-time solutions and wouldn’t get us on the path of the hard work we need to do to meet the challenges of July. So, I appreciate the comments about what we’ve decided to do for this year. They really are intended to get us on the path to an expense base that positions us better for next year.
As for the claw-back, for anyone who doesn’t know, there is a proposal that the 2 percent cost of living adjustment, the COLA, which was placed in effect Jan. 1, be pulled back as of July 1. That is the governor’s proposal. It is under review by the attorney general to determine whether that can be done. That’s where the matter stands at this point.
Q: What else are we doing to try to put ourselves in a better budget situation?
Dr. Perman: What we are doing at this point is planning. In my State of the University speech last April I announced an intent to form a group led by Pete Gilbert, our chief operating officer, to try to take out over the ensuing several years $20 million in expenses. That group has been working diligently, talking as a team of leaders to their folks in each area. So, I would rather not have been challenged by a $6.9 million cut to this campus for this year. We won’t know for sure until we know what’s going to happen with the COLA, but we’re estimating an additional $3.5 million cut for this University as of July 1. We’re working as a team to decide where we can take out expense. We will get through whatever is ahead of us.
We may need to do some selective reductions in force. We may need to do things that are as straightforward as not spending the state dollars for what have been appropriate expenditures for food and everything in between. I am confident that we can deal as a family and as leadership together in making these numbers. As you heard from Mr. Hughes, we are not intending to retreat, we’re intending to move forward.