IS THE INDUSTRY MOVING TOO FAST?:

State, City Rank 3rd in Biotechnical Research - Part 2

by David Little

EDITOR'S NOTE: This is the second in a series on the impact of biotechnology on the economies of Maryland and Baltimore. [Part 1: Aquaculture, Biotechnology Are Changing Food Industry]
     If you think technological change has been rapid over the past few decades, then hold on to your hat, because progress in nearly every area of technology is speeding up. And on the leading edge of all of that change is the still new but already important field of biotechnology.
     For the record, “biotechnology” refers to the use of scientific and engineering techniques to create commercially useful products from the life processes of organisms. The field relies heavily on genetic engineering and molecular biology. It has generated new products as diverse as pollution-devouring micro-organisms and genetically-based disease therapies.
     Critics of biotechnology worry that scientists are moving too fast to probe and exploit the very basis of life. Its fans believe it will produce economic benefits, help feed the world, and control diseases. All, however, agree that the field’s potential to affect our lives is almost limitless. It will likely impact how we conceive and nurture our children, what we eat and how it is grown, even when and how we will die. The world of our children and grandchildren is largely being shaped in the laboratories of universities.
     Two events in 1980 created the impetus for biotechnical research in this country. That year the U.S. Supreme Court ruled that human-made organisms can be patented as commercial products, helping to secure the economic basis for the industry. Then Congress passed the Bayh-Dole Act to spur the commercialization of research findings in all of the sciences. Prior to the passage of that law, the federal government retained all patents generated from research involving federal funds. Useful results often disappeared within the giant federal bureaucracy. The Bayh-Dole Act handed back patents on research findings to the universities that generated them, on condition that they move aggressively to commercialize the findings in partnership with private businesses. The Act created a bias in favor of alliances with small, rather than large, businesses and it mandated that royalties be shared with the individual researchers who made the discoveries.
     Since the passage of the Bayh-Dole Act, patents generated by U.S. research universities have quintupled. They have set up offices of technology transfer and they are accepting technology licensing applications from private companies.
     Such offices have sprouted at the University of Maryland, Johns Hopkins, and UMBC.
     Start-up technology companies, particularly biotech firms, now cluster around the universities, clamoring for the risky privilege of trying to turn research patents into viable commercial products.
     In 1985 the Maryland General Assembly, taking note of these events, created the University of Maryland Biotechnology Institute (UMBI) and mandated that it not only carry out research but work to foster a private biotechnology industry in the state as well.
     The UMBI of today has grown into a large establishment with four main research arms: the Center for Agricultural Biotechnology in College Park; the Medical Biotechnology Center on the campus of the University of Maryland, Baltimore, which includes the Institute of Human Virology, headed by Robert Gallo, M.D. and dedicated to finding effective therapies for AIDS; the Center of Marine Biotechnology in Baltimore’s Inner Harbor, which explores the economic potential of the world’s marine life; and the Center for Advanced Research in Biotechnology, located in Rockville, which is exploring the uses of genetically engineered protein molecules.
     The biological and medical research done at Johns Hopkins University is so vast and multifaceted that probably no one knows exactly how much of it is biotechnical in nature. But according to Theodore Poehler, Ph.D., Vice Provost for Research and Development, “Most of the research we do here at Hopkins has biotechnical implications.” Hopkins spent about $400 million last year in health science-related research and receives more National Institutes of Health (NIH) research grants than any other university.
     The biotechnology program at UMBC is younger and smaller than the UMBI, but according to Mike Breton, Ph.D, an Assistant Vice Provost for Research, it has grown by about 15% a year for the past four years. A UMBC researcher is presently exploring the protein structure of the AIDS virus under a grant from the Howard Hughes Institute.
     Between the efforts of the region’s universities and the fact that major federal research institutions , such as the FDA and the NIH, are located in Maryland suburbs, our state now has the third largest private biotechnology industry in the country. That industry is largely a child of the Bayh-Dole act.
     But does the Act create a situation that is financially fair for all? Opinion is divided. For instance, this past April the Boston Globe ran a series of articles that asserted the Bayh-Dole Act has served as a subsidy for already-rich companies and that the federal government is needlessly forfeiting patent money that could be used to finance more research.
     Also in April, ABC News aired a report complaining that federally funded research amounts to a cash cow for the pharmaceutical companies that end up with the patents.
     Stephen Fritz, Ph.D., head of the University of Maryland, Baltimore’s technology transfer office, disagrees. “The idea of Bayh-Dole is to make more of the fruits of research available for the benefit of the public,” he said. “Private companies working through the marketplace do a far better job of that than either universities or government bureaucracies. Besides, these companies invest, sometimes heavily, to change research into products, and they lose their investment whenever things don’t pan out. Even if they get a marketable product they have only a few years to recoup their investment and turn a profit before the patent runs out.”
     According to UMBC’s Dr. Breton, even after a patent is issued a biotechnical discovery may take 10 years or more to reach the marketplace because of lengthy trials involving human subjects.
     “We choose the companies we license very carefully,” states Dr. Fritz. “And we get a fair royalty for the university-- which we use to support more research.”
     While debate over Bayh-Dole is likely to go on for some time, research continues apace, making biotechnology a promising career field for well-educated Marylanders.

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This story was published on June 3, 1998.