Issue Date: April 20, 2009
Entrepreneurs In Academia
TIMOTHY M. SWAGER remembers presenting a poster on conjugated polymers as a postdoc at his first Gordon Research Conference in 1989. An older gentleman saw the poster and said, "This is all pretty stuff, but how much a pound is this going to cost?" A few thousand dollars, Swager estimated. The man replied, "Son, there isn't anyone who is going to pay more than $1.00 per pound for a polymer."
A more complex version of the polymer became the basis for sensors that detect TNT vapors. A small company called Nomadics, which is now part of ICx Technologies, an Arlington, Va.-based security company, developed the sensor technology, which is now being used to find roadside bombs and bomb makers in Iraq. The polymer costs tens of thousands of dollars per pound, but it saves priceless human lives.
Swager, now chair of the chemistry department at Massachusetts Institute of Technology, described how the polymer he developed in academia was commercialized by a small business at a symposium in the Division of Small Chemical Businesses at the American Chemical Society meeting last month in Salt Lake City.
Sixty-five percent of U.S. workers are employed in small businesses, said Michael Lefenfeld, the symposium's organizer and president of SiGNa Chemistry, a small business with headquarters in New York City that is developing materials and processes based on stabilized reactive metals. With big chemical companies cutting back R&D programs and laying off thousands of workers, small chemical businesses now represent a significant portion of the chemistry-related invention pipeline and may yield jobs even in these tough economic times, he said.
In the current economy, it is particularly difficult, although not impossible, to raise the money to start a small chemical business, said entrepreneur John A. Rogers, a chemistry professor at the University of Illinois, Urbana-Champaign. Even though investors are tightening their belts, he suggested that it's a good time to hire, to get high-quality low-rent space, and to buy equipment. "The net balance, however, is that things are more difficult," he said.
At the ACS symposium, seven professors described how they used small businesses as vehicles to move research from the academic laboratory into products and services in pharmaceuticals, catalysis, life and materials science, nanotechnology, and laser devices. Each professor has founded at least one start-up company. Some of these companies have been more financially successful than others, but each has yielded jobs, products, and lessons about science, technology, and business that the professors pass along to their students.
Inspired by their adviser's successful small chemical start-ups, most of George M. Whitesides' students and postdocs at Harvard University want to start their own companies. This is the kind of entrepreneurial spirit that is needed to get new technology out of the ivory tower and into broader use, Whitesides argued. "If you look at the big problems now—energy, environment, climate change, affordable health care—all of these things have enormous chemical components to them," he said. "The biggest problems in society are now chemical, and we are going to need to get that technology into the world."
That said, Whitesides is plain about how chemical businesses work. "The objective of a company is to provide a return for its investors," he said. "It is nice to say that a company should also solve social problems, but basically, it is a mechanism for taking money from investors and giving them back more money." Businesses fail when people forget the objective, he added.
"If you want to make money, this is a good way to do it," Whitesides said about starting a small business. But Nobel Laureate Robert H. Grubbs, a chemistry professor at California Institute of Technology who is currently involved with three small chemical businesses, counseled, "Don't do it to make money."
MONEY ASIDE, students benefit from seeing how the science that they worked on gets translated beyond a journal article and into an application, Grubbs and others noted. Companies can also enhance the productivity of an academic research group, said Marcos Dantus, a chemistry professor at Michigan State University. "Students learn that their work can revolutionize industry, and the company gives them access to equipment that is not available at other universities," he said.
As in teaching, putting in a lot of time is essential for starting a small business. Rogers suggested the rough timeline to get a small chemical business off the ground and marketing a product is at least four years. But according to Dantus, "'Overnight success' takes about 10 years."
Balancing commitments can be tough, the professors noted. Because running a research group as well as starting and maintaining small businesses involves many hours, it's important to work in time for family and friends, said Joseph M. DeSimone, a chemistry professor at the University of North Carolina, Chapel Hill.
Balancing the needs of a research group and a role in one or more small businesses can be tricky, too. Professors have to publish papers to get the grants that feed their students and postdocs, Grubbs pointed out, but they must patent before publishing to protect intellectual property.
Entrepreneurship can also invite negative reaction in academia. Several professors told C&EN that some of their university peers "looked down on" them for seemingly diverting attention from their students by starting businesses. To this criticism, they respond by saying that starting companies gives their students an education in how chemists can give back to the world.
The motivations to start a company vary. For example, Ronald Breslow, a chemistry professor at Columbia University, didn't plan to do it, but he did so to get funding for human trials of a cancer drug that is now approved by the Food & Drug Administration.
The story starts with science, Breslow said. In 1971, Charlotte Friend, a microbiologist and oncologist at Mount Sinai School of Medicine, found that dimethyl sulfoxide turns cancerous red blood cells into healthy cells. Breslow and cell biologist Paul A. Marks and coworkers started in 1974 to look for more potent analogs. The result was suberoylanilide hydroxamic acid (SAHA) (C&EN, April 16, 2007, page 42).
It would take nearly $100 million to continue preclinical testing of SAHA and complete Phase I and II human trials, Breslow said. So in 2001, he and his colleagues started New York-based Aton Pharma and raised venture capital to do that work.
Aton won approval for Phase III trials of SAHA in 2004; soon thereafter, Merck & Co. bought Aton and completed the trials. In 2006, FDA approved the anticancer agent, now called vorinostat (Zolinza), for treating cutaneous T-cell lymphoma. The drug has such broad activity that clinical trials continue today to test its use against many other kinds of cancer as well as other diseases, Breslow added. Sales of Zolinza in 2008 were $15 million, according to Merck.
Like Breslow, Grubbs didn't set out to start a company. Materia, the Pasadena, Calif.-based company he founded in 1998, "sort of grew out of necessity, mostly for my sanity," he said. So many labs had requested samples of his air-stable ruthenium olefin metathesis catalysts that his research group at Caltech couldn't reliably fulfill them all. Materia's production facility in Texas now produces large, high-quality quantities of the catalyst.
Making catalysts and finding uses for them remain the company's platform. "Any place you have double bonds, you can use this catalyst," Grubbs said.
Materia's latest projects include making cosmetics and pheromones. The list has grown so long that focusing on just a few products is now needed, Grubbs said.
Other companies based on platform technologies are spinning off products. For example, UNC's DeSimone said Liquidia Technologies, a North Carolina-based firm that he started, may soon spin off specific products based on its platform technology of designing particles and patterned films for life and materials science applications.
Liquidia's platform technology grew out of DeSimone's efforts to build fluoropolymers by using supercritical CO2. When the group discovered particular perfluoropolyethers, DeSimone thought the materials' low surface energy made them good candidates for materials to mold individual particles. He started Liquidia in 2004 with another UNC faculty member and two former graduate students. They developed a technology called PRINT (particle replication in nonwetting templates) to use perfluoropolyether molds to make micro- and nanosized particles from various organic and inorganic materials without the residual film between the particles that had previously hindered other strategies.
PRINT's ability to control size, shape, chemistry, and modulus of particles makes it a powerful way to produce particles with controlled performance for numerous applications, said DeSimone. For example, Liquidia can make particles of pure bioactive pharmaceuticals suitable for inhaled delivery or particles that mimic red blood cells.
Despite the versatility of its technology, Liquidia is a product-development company with a focus on manufacturing, DeSimone emphasized.
Among the professors who spoke at the symposium, Whitesides is one of the most prolific in commercializing lab results. He founded the Cambridge-based Nano-Terra in 2005 to commercialize soft lithography techniques developed in his Harvard lab. Nano-Terra has licensed a number of Whitesides' patents and signed collaborations with large companies including 3M and Merck KGaA.
Nano-Terra's business is not based on manufacturing a product itself, but the company profits when its customers sell jointly developed products to consumers. "We solve customer problems," Whitesides said. "It's an experiment that is working so far."
Whitesides is also a cofounder of Durham, N.C.-based Semprius, together with Illinois' Rogers and two other professors. Established in 2004, Semprius commercialized a technology developed in Rogers' lab to stamp or print, for example, high-performance semiconductors, transistors, or silicon nanoribbons onto surfaces such as glass, flexible or rigid plastic, metal, or other semiconductors. Semprius' printing technology could be licensed to advance development of large electronic displays, Rogers said, because the infrastructure for creating displays is prohibitively expensive for a small company.
OF THE SEVEN professor-entrepreneurs, several sit on their companies' boards. Dantus, founder of BioPhotonic Solutions, in East Lansing, Mich., is the only one who acts as his company's president while still keeping his faculty position.
As a Ph.D. student of Ahmed H. Zewail's at Caltech, Dantus worked on the first femtosecond studies of chemical reactions and continues to work with femtosecond lasers. He sought a way to reliably deliver ultrashort (sub-10 fs) laser pulses to a target. Reliable delivery would avoid the need for postdocs to tweak the laser daily and would make femtosecond laser techniques more attractive for applications such as biomedical imaging and remote detection of explosives.
To achieve that goal, Dantus' research group at Michigan State invented a pulse optimization method to compress ultrashort pulses on the way to the target. BioPhotonic has six full-time and four part-time employees who have helped commercialize multiphoton intrapulse interference phase scan (MIIPS), which is used at research institutions worldwide.
Two decades after his first Gordon Conference poster session, MIT's Swager is following the entrepreneurial spirit of his Ph.D. adviser, Grubbs. Swager started his own company in 2001, called Iptyx, in Cambridge, Mass. It will commercialize related triptycene-based polymers that have low dielectric constants or high strength. By leveraging his experience in security technology, he hopes these new polymers can be used to produce ultra-high-strength materials such as bulletproof glass.
Unfazed by the numerous challenges he has already encountered as a small-business founder, including the tough climate for financing, Swager is not giving up. His advice to students and other scientists who want to start companies: "Have patience."
- Chemical & Engineering News
- ISSN 0009-2347
- Copyright © American Chemical Society