Honing the Edge

U project looks to future

  • Article by: THOMAS LEE , Star Tribune
  • Updated: August 30, 2009 - 5:16 PM

The first phase of the school's ambitious biotech park opens in October near TCF Bank Stadium.

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Kevin Ross, left, senior project manager and Richard Johnson, right, biomedical facilities director, led a tour of the new medical biosciences building at the University of Minnesota.

Photo: Glen Stubbe, Star Tribune

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Vance Opperman is a board director at TCF Financial Corp. and, come Sept. 12, he will watch the University of Minnesota play its first game at the new $288.5 million football stadium that the bank helped pay for.

But for Opperman, a prominent local venture capitalist and a University of Minnesota Law School alumnus, a much more important university facility will open the following month just across the street from TCF Bank Stadium: a 115,000-square-foot lab and office building that will be devoted to high-tech research in memory loss, brain diseases and immunology.

The Medical Biosciences building -- along with the existing McGuire Translational Research Facility, Lions Research Building and the Center for Magnetic Resonance and Research -- marks the first phase of an ambitious $292 million plan to develop a 700,000-square-foot biomedical research park on the east side of the U campus. Throw in investor Steve Burrill's plan to raise a $1 billion investment fund to back the Elk Run Biosciences Center in Pine Island, and Minnesota suddenly seems awash in biotech projects.

But football stadiums aside, the park, dubbed the Biomedical Discovery District, is critical to the state's economic future, said Opperman, who has no direct connection to the project.

"I would rather see the U take a bet on biotech and the long-term economy than I would take on football," Opperman said. The district is "the most courageous, aggressive development the U has ever taken."

And its riskiest.

Under its financing plan, the U will spend $73 million on a big real estate expansion at a time that the school must raise tuition to cover budget shortfalls. The university has already pushed back the project's completion date by two years, to 2015.

Despite some impressive research, the U has historically struggled to convert its discoveries into profit. A high-profile partnership with Mayo Clinic hatched two years ago has so far yielded few licensing deals and no start-ups. The U also spent $2 million on University Enterprise Laboratories (UEL), a biotech incubator in St. Paul that failed to meet expectations.

Yet the biomedical district enjoys advantages that UEL did not. For example, the state issued a $219 million bond to back the project; UEL received no state money.

The school's improved tech transfer office is also a plus. Since 2004, the school has spun out five companies and will soon launch a start-up based on Dr. Doris Taylor's work in regenerative medicine. As of June 30, licensing revenue (excluding AIDS drug Ziagen) totaled $8.67 million, an 11.1 percent jump from the same period last year.

"The U has gotten its act together toward technology commercialization," said Frank Cerra, the university's senior vice president for health sciences and dean of the medical school. Cerra is a longtime champion of the district.

But the district's greatest asset is location. The research buildings are clustered in one area, making collaboration between scientists much easier, Cerra said.

"The proximity was absolutely critical," he said. "A big success factor in research is an environment of innovation. Researchers have to interact. People create innovation."

University officials this month broke ground on a $53.2 million addition to the Center for Magnetic Resonance and Research (CMRR). The facility provides detailed MRI images of animal and human bodies, a useful tool for scientists looking to treat cancer, heart failure and Alzheimer's disease. The expansion will host a magnet that will create the world's largest magnetic field for human imaging.

The district means "medical research and collaboration will be much enhanced, with us right in the center," CMRR director Kamil Ugurbil said. "This is not the endpoint. We've just gotten out of the gate."

But the district faces enormous challenges. Experts say university research parks still lack strong academic industry partnerships needed to commercialize research.

"Moving innovation into the marketplace does not happen naturally or easily," according to a report by the Association of University Research Parks and Battelle, a consulting and research firm that specializes in technology commercialization and laboratory management. "Research parks must continue to serve as an intermediary [between business and academia] that understands both culture and innovatively fosters integrated, collaborative efforts."

That collaboration has not come easily to the U, though the school is improving, observers say. Cerra said the school is talking with several developers to build "accelerators" on district land. Such accelerators help speed the development of new companies by providing start-ups with office space, money and experienced management.

Another obstacle: changing the faculty's attitude toward commercialization. The U's professors have historically been more interested in publishing research papers than in spinning out new companies. Cerra acknowledges the challenge, but says that the school has recruited new talent interested in tech transfer because of the U's investment in the biomedical district.

Opperman, the venture capitalist, says many biotech projects have come and gone in Minnesota without much success. But he predicts that the sheer size and scope of the U's plan means it won't be neglected.

"The U has not been particularly good at setting long-term goals and accomplishing them," Opperman said. "But the audacity of the project is an advantage; it gets people's attention. It drives more people and energy into the project -- a kind of magnetic effect."

Thomas Lee • 612-673-7744

  • about this series

  • A continuing series on innovation in Minnesota.
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  • HONING THE EDGE A CONTINUING SERIES ABOUT INNOVATION IN MINNESOTA

    To read the Honing the Edge series, go to www.startribune.com/edge.

    ONLINE

    Remember the University Enterprise Laboratories? The much-maligned incubator is launching a new plan to attract early-stage start-ups. Some of them might even come from the U of M. Go to the Patent Pending blog at www.startribune.com/blogs/pending.

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