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news
and views for entrepreneurs .....as
of Feb 3, 2012 Note: Carl Nelson Consulting, Inc is not an investment adviser and may hold a financial interest or client relationship in companies discussed.
Achillion Pharma up
12% [Feb 2, 12] Affymax up
14% [Feb 2, 12] Dynavax Tech up
11% [Feb 2, 12] It's totally implausible to think that there's going
to be a surge in manufacturing jobs. [Laurence
Katz, Harvard economist] Nevertheless, we are in a
polirtical campaign in which promises do not have to match
facts. It isn't small
businesses so much as new businesses that typically
power job growth during economic recoveries. Trouble is,
that engine isn't firing on all cylinders this time
around. Even as the pace of company closings returned to
normal, prerecession levels by the end of 2010, the
formation of start-ups continued to lag behind.
[Kelly Evans, Wall Street Journal, Feb 3] One of the
myths of SBIR is that the money helps create jobs by
funding small biz, when the facts are that the mission
agancies that control most of the SBIR money keep funding
companies that have been feeding on SBIR for three decades
with little record of economic growth contribution.
But then, myths are the power speech of politics. while over three decades Kodak’s Rochester-area
employment dropped to fewer than 7,000 jobs from 61,000,
the community itself gained a net 90,000 jobs. That’s
because the Rochester economy is more diverse than most
realize — in part, surprisingly, because of
Kodak. The high-skilled workers it let go over the years
created a valuable labor pool for start-up companies,
particularly in optics and photonics.It also helps that
Rochester has a strong higher-education sector, which
has likewise been supported by Kodak. The University of Rochester became a leading research
center through gifts from Kodak’s founder, George
Eastman, who also gave generously to the Rochester
Institute of Technology. [Duncan Moore, New
York Times, Feb 3] The ugly reality of technology as
an industry is that government subsidy of tech in
anotherwise tech sterile enviromment will not produce
magical economic growth, only local votes for as long as
the subsidy lasts. Trees
don't grow to the sky. More than half of its users access Facebook
through a mobile device, like these users in Jakarta,
Indonesia. But Facebook serves no ads on its mobile
products. That's a problem. Other vulnerabilities
include Facebook's dependence on Zynga for revenue, the
inevitable decline in user growth rates, and the
concentration of governing power held by Mark Zuckerberg
[hris O'Brien, San Jose Mercurt News, Feb 2]
Software attracts competitors who have little capital
barrier,and the established company has little to hold its
customers. All of which is one reason that government
subsidy, like SBIR, isn't needed for software if economic
growth is the object. Affymax up
11% [Feb 1, 12] Sangamo up
21% [Feb 1, 12] Shire plc (UK), the
global specialty biopharmaceutical company, and Sangamo
BioSciences, a leader in genome-editing technology,
announced today that they have entered into a
collaboration and license agreement to develop
therapeutics for hemophilia and other monogenic
diseases based on Sangamo's zinc finger DNA-binding
protein (ZFP) technology.
[press release, Feb 1, 12] Tax breaks for angel
investors have cropped up in recent years in about two
dozen states as a means of stimulating job growth. But
the effectiveness of the incentives—which range from
breaks on 15% of funding in Colorado to 100% in
Hawaii—are coming under greater scrutiny, particularly
as states face budget pressure. Many states' programs
expired at the end of 2011, were stripped of funding or
were placed under a moratorium. [Angus
Loten, Wall Street Journal, Feb 2] State handouts
lack long-term vision as politicians want high ROI by the
next election. SBIR handouts survive because they do
not require appropriations and are seen as just another
political nuisance by the agencies which capture it as
best they can for their own purposes. And neither jobs nor
economic growth is their mission. iRobot will
make a $6M investment in InTouch Health (San Diego, CA; no
SBIR) , a telemedicine company. [Julie Donnelly, Boston
Business Journal, Jan 31, 12] EpiEP (New Haven,
CT; no SBIR)
received its second $1 million investment from
Connecticut Innovations in as many years.... makes
a device that verifies the outside surface of the heart
has been accessed in order to treat arrhythmia, is in
clinical trials in Europe. It has successfully completed
animal trials at the Mayo Clinic ... moved from Virginia
in 2010 ... The state is borrowing $25 million this year
to send more cash to CI for investments such as this
one. [Mara Lee, Hartford Courant, Jan 31,
12] idea sharing is what
EvoNexus hopes to foster in its new downtown [San
Diego] incubator for young technology companies.
.... trying to mimic the success of the South of Market
neighborhood in San Francisco, where a hub of software
and Internet companies has sprouted. .... So far,
six companies have graduated from the University
City-based EvoNexus program. They have raised a combined
$55 million in venture capital. Mike
Freeman, [utsandiego.conm, Jan 31] Arkwright's real claim
to fane was that he was successful [arranged, combined,
and used the inventions of others] . the first who knew
how to make something out of other men's inventions ..
to raise the necessary capital, he must have displayed
remarkable business ability, together with a curious
mixture of cleverness, perseverance, and daring.
[Paul Mantoux, The
Industrial Revolution in the Eighteenth Century,
1928] MELA Sciences up
14% [Jan 30, 12] Bain Capital’s venture
group has raised a $600 million for a new venture
capital fund, a spokesman for the Boston firm confirmed.
The new fund will invest in technology start-ups as well
as in larger deals. [Beth Healy, Boston Globe,
Jan 30] Merrimack
Pharmaceuticals (Cambridge, MA; $1M SBIR)
focused on cancer treatments, wants to raise $167 million
in IPO on NASDAQ as "MACK" [Lynn Cowan, Wall Street
Journal, Jan 30, 12] Cempra (Chapel Hill, NC; no SBIR) developing new antibiotics for pneumonia and staph wants to raise $78 million in IPO on NASDAQ as "CEMP." [Lynn Cowan, Wall Street Journal, Jan 30, 12] First Solar up
11% [Jan 27, 12] BioCryst Pkarma up 15% [Jan 27, 12] Cepheid up 26%
[Jan 27, 12] Immunogen up
12% [Jan 27, 12] In January 2012, we sit again on the cusp of three grand technological transformations with the potential to rival that of the past century. All find their epicenters in America: big data, smart manufacturing and the wireless revolution. ... Information technology has entered a big-data era. Processing power and data storage are virtually free. ... Smart manufacturing. This is the first structural shift since Henry Ford launched the economic power of "mass production."... the unfolding communications revolution where soon most humans on the planet will be connected wirelessly. Never before have a billion people—soon billions more—been able to communicate, socialize and trade in real time. [Mark Mills and Julio Ottino, Wall Street Journal, Jan 30] More and more people
around the world are becoming entrepreneurs, according
to a Global Entrepreneurship Monitor 2011 report. The
world’s “innovation-driven” economies saw an increase of
22 percent in early-stage entrepreneurship in 2011, as
measured by the number of people operating a business
that’s less than 3.5 years
old. ... In the United States, such activity
increased 60 percent last year from 2010.
[Olga Kilzan, Washington Post, Jan 29] A multitude of
organizations across Maryland, Virginia and the District
have made it their mission to cultivate and advance
[entrepreneurs and young companies], often with the idea
that they will produce high-growth companies and create
jobs that in turn generate tax revenue. This week
marks the one-year anniversary of the Startup America
Partnership, a national initiative created by President
Obama and chaired by former AOL chief executive Steve
Case that aims to promote private-sector investment in
entrepreneurship. [Steve Overly,
Washington Post, Jan 30]
Momenta Pharma down 21% [Jan 26, 12] in the wake of a federal appeals court ruling related to its ongoing battle to keep a competing generic formulation of the popular blood-thinner Lovenox off the U.S. market. [Market Watch] Ener1 maker of rechargeable car
batteries that was using a $118.5 million Energy
Department grant to build a factory in Indiana filed for
Chapter 11 bankruptcy protection Thursday, becoming the
latest green-energy company backed by the Obama
administration to run into trouble. Ener1 Inc.
said its prepackaged bankruptcy filing will enable the
company to receive a new infusion of capital and keep
its operations going. Ener1 reached a deal with lenders
to cut its $91 million debt in half and said it would
receive $81 million in new funds, mostly from Bzinfin
S.A., a company backed by Russian businessman Boris
Zingarevich.A subsidiary of Ener1 called EnerDel Inc.
employs 275 workers outside Indianapolis and is going
forward with building its battery plant, Ener1 said. The
subsidiary isn't in bankruptcy. [K Stech
and J Palank, Wall Street Journal, Jan 27, 12] Avila Therapeutics (Bedford,
MA; no SBIR) said
it has agreed to be acquired by biopharmaceutical giant
Celgene Corp., based in Summit, NJ., in a buy-out deal
potentially worth $925 million if Avila is able to
eventually win approval to market treatments for cancer
and other diseases. Avila, a five-year-old privately
held biotechnology company backed by Waltham’s Polaris
Venture Partners, specializes in covalent drug
chemistry, which allows molecules to bind to disease
proteins and shut them down. [Robert
Weisman, Boston Globe, Jan 26, 12] Illumina said its board of directors
had adopted a poison pill shareholder rights plan
that could allow existing shareholders to purchase more
shares at a discount under certain conditions. The
move, which is fairly common in hostile takeover bids,
could potentially make it much more expensive for Roche
to gain control of Illumina – thus thwarting the
takeover. [Mike Freeman, utsandiego.com,
Jan 26, 12]
Japanese-owned
factories
and skills account partly for the fact that
manufacturing production in the U.S. has not declined,
as some doomsayers claim, but has in fact expanded by
about one-third over the past decade. There hasn't
been a corresponding increase in factory
employment—there has been a decline—because robotics
(also pioneered by Japan) have made production more
efficient. Lecroy down 12% [Jan 25, 12] Illumina up 55%
[Jan 25, 12] Repligen up 11%
[Jan 25, 12] Interdigital
(King of Prussia, PA, nearly $3M SBIR in New York as SCS
Telecom and Interdigital Telecom) down 20% [Jan 23, 12] after the developer of
wireless technology said it plans to focus on growing
rather than on getting bought. [Peter Kay,
Philadelphia Business Journal, Jan 24, 12] When startup FireFly LED Lighting (Austin, TX; no SBIR) was accepted into the Austin Technology Incubator two years ago, its LED bulbs were still prototypes.Since then, the company has launched its product line, signed customers including Kerbey Lane Cafe and the University of Texas and received $3.4 million from backers including the Central Texas Angel Network and the Texas Emerging Technology Fund..... Since its founding in 1989 by legendary business leader George Kozmetsky, ATI has worked with more than 200 startups, helping them raise nearly $1 billion in investment capital. [Lori Hawkins, Austin American Statesman, Jan 26, 12] Graduates: Agile Planet, Atomometrics, Axelo, Calxeda, Dorsan Biofuels, Famigo, GameSalad, Ideal Power Converters, Itzbig, Nitero, Notice Technologies, Open Algae, Qcue, RFMicron, RRE Solar, Savara Pharmaceuticals, Spredfast, Terapio ($500K SBIR), Unwired Nation, WiMax.com. Entrepreneurial North
Carolina companies with high growth potential have
created 40,560 jobs over the past two decades.
[says] Durham-based CED, an entrepreneurial support
group. The study represents the first such accounting
ever compiled, said Joan Siefert Rose, CED's
president. ... of the 1,823 entrepreneurial
companies formed since 1992 in North Carolina, 78
percent were "bootstrapped," or self-funded, either by
design or because they were unable to raise outside
funding. The 397 companies that did attract venture
capital or other sources of private capital raised a
total of $7.7 billion. [David Ranii, Raleigh News
& Observer, Jan 26] No mention of the net job
growth in and by these companies by accounting for jobs
that soon disappeared. Advocates and politicians for
favorable government treatment of small biz love such
one-sided numbers. Oh, never mind, we have a democracy in
which giant banks and small companies (with as many as 500
employees) beg for and get government favor in return for
helping politicians get re-elected. We've survived for 220
years with voters who know next to nothing about
economics. Access
to capital for early stage technology and life sciences companies
is a worldwide problem with no easy fixes in
sight. .... CONNECT was
started in San Diego in 1985 to nurture early stage
technology and life sciences companies. Since then, it
has assisted in the formation and development of more
than 3,000 companies in the San Diego region, and its
model has been emulated around the world. ... When
we asked how the angels had done in the deals, everyone
told us the same tale. The angels
had not done well financially. They had not had a good
experience, and so capital has become even more gun-shy.
In many cases, instead of supporting the local
entrepreneurs, the smart capital, the super angels, have
begun to look abroad—to the United States and Silicon
Valley in particular. ....Michigan is new to the game.
Long dependent on the auto industry Michigan has now
realized that it must develop an entrepreneurial
culture, and it’s blessed to have a great research
university—the University of Michigan. The state
has committed $1 billion over a period of years to the
creation of high-tech and life sciences companies,
according to Paula Sorrell, managing director of
entrepreneurial services for the Michigan Economic
Development Corporation. Much of this is being invested
in venture funds that invest in early stage Michigan
companies. The state is also investing in pre-seed funds
that provide up to $250,000 and in support organizations
like CONNECT. [Neil Senturia and
Barbara Bry, utsandiego.com, Dec 27, 11] seven policy initiatives, most of which have bipartisan support, that could catalyze job growth without raising taxes or adding to the deficit: Recruit Foreign Talent and Entrepreneurial Capital, Expand Free Trade Agreements, Promote Tourism, Modernize Export Controls, Create National Enterprise Zones, Increase Capital Access for Start-ups, Revitalize the Housing Sector [Bradley Belt is Senior Managing Director of the Milken Institute, realclearmarkets.com, Jan 26] Since each of these has a group of losers somewhere, they are unlikely to get legislated no matter how much economic common sense they make. Present interests vote and the future does not vote. And we cannot bring back Alexander Hamilton to pound sense into politicians. Roche Holding AG is
offering $5.7 billion in cash to buy U.S. gene
sequencing company Illumina in a hostile takeover
bid that marks a major play by the Swiss drugmaker into
the gene technology field. .... Companies
such as Illumina, Affymetrix and Life
Technologies
get 20-40 percent of their revenue from U.S.
government-backed research and may take a hit from any
government funding cut. [Reuters, Jan 25,
12] Illumina enjoyed about $10M SBIR
1999-2010, and a $4.6B market cap before the Roche gambit.
Founder David Walt now owns less that 1% of the shares.
Employees: 1200. Avila Therapeutics
(Bedford, MA; no SBIR) biotechnology
company developing drugs that treat diseases through
protein silencing, said that it has achieved the first
milestone in its alliance with Clovis Oncology --- a
milestone that triggers a $4 million milestone payment
to Avila. The alliance is working on a potential
treatment for some forms of non-small cell lung cancer.
[Chris Reidy, Boston Globe, Jan 23, 12] Achillion Pharma up 17%
[Jan 23, 12] Aphios (Woburn,
MA; $6.7M SBIR) is due
$2.4 million over two years to create a treatment for
Alzheimer’s disease, courtesy of a Phase 2
SBIR.... focuses on developing treatments for some
cancers, infectious diseases and central nervous system
disorders. It also works on a platform for drug
development, nanotechnology drug delivery and pathogenic
drug safety. [Michelle Lang, Mass High
Tech, Jan 24, 12] X-Body (Waltham, MA; no SBIR) has boosted its November fundraising tranche to $4.14 million .... focused on technology to discover and develop human antibodies to treat certain types of cancer and other diseases. [Rodney Brown, Mass High Tech, Jan 24, 12] Medical technology firm InCytu
(Lincoln, RI; no SBIR), has
taken in $1.86 million in a new equity funding round,
federal documents show. ... based on the Cellarium
platform technology first developed by David Mooney of
Harvard University. Cellarium uses a biopolymer scaffold
the size of a vitamin pill that is implanted to function
as a micro-factory, drawing in naturally occurring
cells, reprogramming them to fight cancer or grow new
tissue in a damaged area, then targeting the newly
programmed cells to those areas, according to the
company’s website. [Rodney Brown, Mas High
Tech, Jan 13, 12] The city of Asheville
is in the second stage of installing 3,643 LED street
lights made by Cree. The installation is projected to create
annual savings in energy and maintenance costs of
$260,000, Cree reported. Cree acquired the LEDway street
lights being installed by Asheville last year when it
purchased Wisconsin-based Ruud Lighting for $525
million.[David Ranii, Raleigh News &
Observer, Jan 24, 12] Solx (Waltham,
MA; no SBIR), maker of
devices for the treatment for glaucoma, has raised $3.25
million of a planned $9 million fundraise, federal
documents show. ... spun out of Boston University’s
photonics lab in 2005 and won FDA clearance in September
2008 for the medical device, which is designed to reduce
intraocular pressure while preserving trabecular tissue.
The company was acquired in 2006 by Canadian firm
Occulogix, but
founder Adams bought it back the following year. It now
operates as a privately held, independent entity.
[Rodney Brown, Mass High Tech, Jan 20, 12] Achillion Pharma down
10% [Jan 20, 12] Verastem
(Cambridge, MA; no SBIR) that is seeking to create drugs that target
cancer stem cells, is scheduled to launch an IPO next
week [DC Dennison, Boston Globe, Jan 20, 12] Alnylam Pharma said it plans to cut its
workforce by 33 percent, or 61 jobs, as part of a
“strategic corporate restructuring” plan. One goal of
the plan is to save about $20 million in 2012 cash
operating expenses. All the company’s employees work in
Cambridge. Alnylam said it is looking to align its
resources as it accelerates development of promising
drug candidates in its pipeline, including one for
hemophilia. [Chris Reidy, Boston Globe, Jan 20,
12] For human-computer
conversations, 2012 is going to be a great year. We
might actually start having proper, fluent exchanges with
robots, chatting away as if we're the same
species. All this is very fitting, as it's the centenary
of Alan Turing's birth. He was the AI pioneer who
suggested we'll one day create computers so lifelike and
responsive, we won't be able to tell them apart from
humans. ... The robotics guru David Hanson predicts even greater things for 2012. He says
we'll pile so much information into our robots that they
will burst spontaneously into life and become sentient,
self-determining beings, evolving in ways we cannot
imagine. [Jon Ronson, The Guardian
(England), Jan 21] There is still a good amount of money going toward late-stage development of drugs people started working on 10-15 years ago. But there is an alarming drop in support for today’s cutting-edge biotech startups. Last year, just 153 U.S. biotech and medical device startups got their first round of financing, the lowest amount of seed investment activity in 15 years, as reported by Ryan Flinn of Bloomberg News. .... cuts, cuts, cuts. The National Institutes of Health, the primary government agency that supports basic biomedical research, used to write checks for one out of every three grant applications, but it’s now down to about one out of every six, NIH director Francis Collins said earlier this month at the JP Morgan Healthcare Conference. Pharma companies are cutting back on R&D, firing workers left and right, and leaning on cheaper outsourced vendors everywhere they can. As many as one-fourth to one-half of biotech venture capitalists are thought to be slowly going out of business, as they are unable to raise new investment funds. [Luke Timmerman, xconomy.com, Jan 23] In the information
sector, American
domination continues to mount, contrary to
predictions of decline over the past two decades.
Although high-tech manufacturing has shifted largely to
Asia, Americans rule the increasingly strategic software
sector. American-based companies, who
constitute more than two-thirds of the world’s 500
largest software companies, including nine of the
top ten. Outside the U.S., there are no
significant equivalents of Apple ,Google, Microsoft,
Amazon and Facebook. Hollywood, for its part, rules the
entertainment world, producing 40% of world’s
audiovisual exports, a dominion that troubles China’s
President Hu Jintao, who recently complained that
the “cultural fields” represent “the focal area” for
Western “infiltration”. [Joel Kotkin,
Forbes, Jan 19] The ten largest
economies in Asia now spend roughly $400 billion a year
on research and development (R&D)—as much as
America, and well ahead of Europe’s $300 billion.
China’s investment leapt 28% in a year, propelling it
past Japan to become the world’s second-biggest spender.
... But Research
spending is an input, not an output. Many a clever gizmo
produced by well-endowed Japanese corporate labs has
turned out to be worthless. Useful innovation means
fresh thinking that creates value. [The
Economist, Jan 21] If all goes well, this
is the year Endocyte
(West Lafayette, IN; $3.5M SBIR) will apply in Europe to launch its first drug,
a novel treatment for ovarian cancer. It would be
a huge step for the small, 65-employee biotech firm. It
has put up an unusually tenacious, 16-year struggle to
turn an idea from its scientist-founder, which debunked
textbook teaching, into a drug that promises hope for
cancer victims and profits for itself and shareholders.
The long road Endocyte has taken has been costly -- over
$150 million -- and lined with obstacles.
[Jeff Swiatek, Indianapolis Star, Jan 7, 12] Wisconsin companies
raised $72 million in venture capital in 2011, a 40% drop from a year earlier,
according to figures released Friday. The decline
contrasted with venture investing nationally, which rose 22% to $28.4 billion, according
to the MoneyTree Report by PricewaterhouseCoopers LLP
and the National Venture Capital Association. [Kathleen
Gallagher, Milwaukee Journal Sentinel, Jan 20] PerkinElmer, a global manufacturer with
more than 500 employees in Shelton, is eliminating close
to 75 jobs as it moves four product lines to England and
Singapore. [Mara Lee, Hartford, Courant,
Jan 20] Regardless of how many jobs in high tech
companies shift offshore, the myth remains that government
subsidy of high tech will save US employment. Like all
subsidies, the rationales are invented to serve the
beneficiaries. Which is why SBIR awards can accumulate to
many tens of millions in companies that show no downstream
economic return other than paying for the temporary jobs.
And as long as the federal agencies can exercise complete
autonomy in awarding the money, the zero-sum game will
continue. American Superconductor
up 27% [Jan 18, 12] RaNA Therapeutics
(Cambridge, MA; no SBIR).
said it has completed a $20.7 million round of financing
co-led by Atlas Venture, SR One, and Monsanto, with
participation of Partners Innovation Fund. ... is
developing a technology platform to enable selective
activation of target genes. [Chris Reidy, Boston
Globe, Jan 18, 12] Oxford Performance
Materials (South Windsor, CT; no SBIR), which has benefited from
Connecticut's support four times since 2001, was
celebrated Wednesday by the governor, legislators and
Department of Economic and Community Development
Commissioner Catherine Smith as the first recipient of
the Small Business Express program. The state has
set aside $100 million to lend and give to companies
headquartered in Connecticut with fewer than 50
employees who need to buy equipment or have expansion
plans that require more employees than current revenue
can support. ...focusing on custom-made implants for
head and jaw surgeries, which is a much higher margin
product than its former line of raw materials for
implants. It's not yet turning a profit.
[Mara Lee, Hartford Courant, Jan 18, 12] A survey of nearly
10,000 alumni of Harvard Business School found that 66
percent of respondents believe that the US is falling
behind when it comes to competing in the global economy.
Asked to evaluate how the trajectory of the US business
environment compares with emerging markets, just 8
percent or respondents see the US pulling ahead. HBS
professors Michael E. Porter and Jan W. Rivkin designed
and conducted the survey [Chris Reidy,
Boston Globe, Jan 18] Achillion Pharma down
10% [Jan 17, 12] Biofuels company Joule
Unlimited (no SBIR) closed on $70 million in a third funding round
from new, unnamed institutional and private investors
[Mass High Tech, Jan 17, 12] Competition
escalating. Although the long decline of manufacturing
employment in the United States is often attributed to
the cheaper wages in developing countries, China and
developing countries in Asia have in recent years
sought to lure more sophisticated manufacturing
operations — and better jobs — by expanding their
engineering prowess through government investment in
education and research. The decline in U.S.
manufacturing as a share of the nation’s economy and
employment over the past decade “is not solely due to
low-wage competition,” the president’s Council of
Advisors on Science and Technology wrote recently. “We
cannot remain the world’s engine of innovation without
manufacturing activity.” [Peter Whorisky,
Washington Post, Jan 17] What's more Global, U.S.-based companies
such as 3M Co., Caterpillar Inc. and General Electric Co. have spent billions of
dollars in recent years to expand their overseas
research labs. Such companies aim to tap a broader pool
of scientific talent, tailor products to overseas
markets and curry favor with foreign governments by
doing more research abroad. ... In the six years
through 2009, about 85% of the growth in R&D workers
employed by U.S.-based multinational companies has been
abroad, according to the National Science Board,
[James Hagerty, Wall Street Journal, Jan 18] In this
political season, pay no attention to the campaign
nonsense of ideas for solving America's declining
competitiveness with more high paid manfacturing jobs
through lower taxes. Americans
want cheap goods without accepting the reality
that cheap goods need either cheap jobs or fewer
jobs. Foreign countries are willing to provide the
cheap jobs without medical insurance or pensions.
Our technology gains raise productivity whose purpose is
to make more and better goods with fewer jobs. The
political system has no solution because its goal is votes
from bribing constituents with favored policies. And SBIR
advocates are just one of the many constituent groups
seeking advantage with no economic proof of its value. “There’s no crisis of capitalism,” says Meghnad Desai, emeritus professor at the London School of Economics. “There’s a crisis of western capitalism, which has gone geriatric. The dynamic capitalism, with its energy, innovation and sheer greed for growth has moved east.” [David Pilling, Financial Tines, Jan 16] Axonia Medical
(Kalamazoo, MI; no SBIR) raised its first million in seed financing from
the Southwest
Michigan First
Life Science Venture Fund and expects to close on
another $500,000 to $1 million in the next six months,
bringing Axonia within reach of its goal of
$3 million. .... produces living,
functional tissue-engineered nerve grafts in the
lab that can replace and repair damaged parts
of the nervous system. [Sarah
Schmid, xconomy.com, Jan 16, 11] Life Technologies said it’s taking orders for
a benchtop genome sequencer that can to decode an
individual’s DNA within 24 hours and at a cost of
roughly $1,000. The company priced its new Ion Proton
Sequencer at $100,000 to $150,000, which also represents
a dramatic reduction compared with the cost of
existing DNA sequencers, and might even entice some
practicing physicians to buy into the idea of
personalized medicine. A cross-town rival, Illumina, also introduced an
improved version of its gene-sequencing machine capable
of same-day service, although Forbes’ Matthew Herper
says Illumina’s HiSeq 2500 is priced
at $740,000. [Bruce Bigelow,
xconomy.com, Jan 12, 12] A $1 million gift to
the Tech
Coast Angels
from the family of slain TCA member and life sciences
investor John G. Watson has enabled the angel group to
establish a nonprofit foundation to support
entrepreneurism in the San Diego region. [Bruce
Bigelow, xconomy.com, Jan 12, 12] AnaptysBio (San Diego, CA; no SBIR) said it has established strategic alliances with Novartis and an undisclosed pharmaceutical company. The company plans to use its proprietary technology to discover and develop new therapeutic antibodies with multiple cancer-related therapeutic targets. AnaptysBio said the two deals provide global rights to develop and commercialize a limited number of antibodies against each cancer target that AnaptysBio generates [Bruce Bigelow, xconomy.com, Jan 12, 12] Metabolix down
58% [Jan 13, 12] after
the company announced that Archer Daniels Midland decided to end the two
firm’s biodegradable plastics joint venture
[Theresa Rivas, Barron's, Jan 13] Trius Thera down
11% [Jan 13, 12] Between January and September last year, roughly 240 new high-tech and biotech enterprises were launched in San Diego County, positioning 2011 to be the best year for tech startups since the recession began, according to Connect, a support organization for the local tech industries. .... Last year, venture capitalists invested around $200 million per quarter in San Diego firms - less than half the rate they were investing before the recession began. And there’s no sign of the situation improving anytime soon. [Dean Calbreath, signonsandiego.com, Jan 15] SBIR could be a boon to startups if the federal agencies cared about economic impact of its investments. But the agencies have no interest in anything other than their own efficiencies and programs.
Foreign policy is like
hitting a baseball: if you fail 70 percent of the
time, you go to the Hall of Fame. [Robert
Kagan, The New Republic, Jan 12] KVH up 14% [Jan 12, 12] Crystal IS (Green
Island, NY; $2.5M SBIR), an early-stage developer of ultraviolet
light-emitting diodes, was acquired by Asahi
Kasei of Japan (founded
in 1931 and has 25,000 employees), the companies
announced. Terms not released. .... formed
in the late 1990s out of Rensselaer Polytechnic
Institute [Physics Dept head Schowalter];, received its first round
of venture funding in 2004. ... also received
significant funding from state and federal
grants. [Richard D'Errico, The
Businesss Review (Albany), Jan 11, 12] Got a
critical Phase II SBIR from MDA back when Jeff Bond
supported companies with serious commercialization
attitudes, not just happy words for DOD pretenses. NeuroLogica
(Danvers, MA; no SBIR) developer
of medical imaging products, has raised $12 million in a
funding round intended to support the company's
higher-than-expected orders of its BodyTom scanner, CFO
Jeff Cohen said. ...... BodyTom is the company's
portable, full body, multi-slice CT scanner, which
landed 510(k) clearance from the U.S. Food and Drug
Administration in March. The device is designed to be
transported from room to room in a manner similar to
existing chest X-ray systems.
[Michelle Lang, Mass High Tech, Jan 11, 12] Hydra Biosciences (Cambridge,
MA; two SBIRs) and
Cubist Pharmaceuticals
said they plan to start
a Phase 1 clinical trial for an experimental pain and
inflammation drug on which they are collaborating,
triggering a $5 million milestone payment to Hydra from
Cubist. [Lori Valigra, Mass High Tech, Jan 11,
12] Sun Power up 11%
[Jan 11, 12] Dexcom up 14%
[Jan 11, 12] MELA Sciences up
11% [Jan 11, 12] Xenoport up 10%
[Jan 11, 12] Connecticut
Innovations, a quasi-public authority that invests in
and advises startup tech companies in the state, is
expanding its reach, opening a third incubator,
investing in companies earlier through a 'pre-seed'
funding stage, and increasing the amount it's investing
in a few dozen firms. The expansion is financed as part
of the jobs bill proposed by Gov. Malloy last year and
adopted by lawmakers. CI will receive an infusion of $25
million this year and in each of the next four years.
[Mra Lee, Hartford Courant, Jan 11] Two ethanol subsidy
programs – which taxed imports, provided tax breaks for
U.S. oil companies, and helped promote corn-based
ethanol production – were allowed to expire at the end
of 2011. However, subsidies still remain for ethanol
developed from cellulosic feedstocks, and Department of
Energy loan guarantees remain for research and
development programs, according to an
article in Chemical and Engineering News. The long-term effects of
these expired programs are not clear, according to the
article, as some believe that ethanol is competitive
with gasoline. [AAAS, Jan 12] Charles River Labs up 17% [Jan 10, 12] BioCryst Pharmaceuticals
(Durham, NC; $1.3m SBIR in Alabama) announced positive
results from a recent study involving its
experimental gout treatment. CEO Jon Stonehouse
said on a conference call with analysts that the company
will meet with federal regulators in the coming months
to extend the current studies involving the treatment.
"These results give us momentum as we enter 2012 and
make it a very exciting year for BioCryst," he
said. BioCryst has yet to have any of its drugs
approved for the U.S. market. Its flu treatment
peramivir was approved in Japan and Korea in 2010.
[David Bracken, Raleigh News & Observer, Jan 10,12] Achillion Pharma up 23% [Jan 9, 12] AMAG Pharma down
10% [Jan 9, 12] Inhibitex up
140% [Jan 9, 12] Intermune up 11%
[Jan 9, 12] LeCroy up 10%
[Jan 9, 12] Drug maker Bristol-Myers
Squibb is
buying hepatitis C drug developer Inhibitex (Alpharetta,
GA; one Phase I SBIR in 1999) for about $2.5 billion, paying a premium
to become a bigger player in the growing business of
treating the potentially fatal virus. ... focuses
on treatments for bacterial and viral infections. The
small company has had an up-and-down history, with its
shares falling in late 2010 after Inhibitex posted
disappointing trial results for its FV-100 shingles
treatment. Near the end of 2011, the stock price hit a
52-week high of $16.49 due to interest in the company's
hepatitis C treatment INX-189. By contrast, the shares
recorded a 52-week low of $2.15. [JD Rockoff, A
Das, and G Chon, Wall Street Journal, Jan 9, 12] TechMaine, the technology industry trade group in the Pine Tree State, has completely thrown in the towel, filing for Chapter 7 bankruptcy protection. [Mass High Tech, Jan 5] Xoma announced it is cutting its
workforce by about a third to focus primarily on
developing its lead drug candidate, an anti-inflammatory
agent it hopes will prove useful for treating various
health problems. [San Jose Mercury News, Jan 6,
12] Navidea Biopharmaceuticals (Dublin, OH; no SBIR) the new identity of the former Neoprobe, has obtained $10 million in debt financing from a life sciences investment fund following a nearly $30 million infusion a few months ago, while hinting at another possible acquisition. ....The company’s most recent acquisition was the rights to AZD4694, which is being researched for use in detecting Alzheimer’s disease. [Carrie Ghose, Columbus Business Journal, Jan 5, 12] Novogy
(Cambridge, MA; no SBIR) cleantech startup, has raised $4 million of a
planned $7.5 million fundraise, federal documents
show. ... developing cellulosic biofuels,
but in Novogy's case, specifically made from waste paper
sludge. [Rodney Brown, Mass High Tech, Jan
6, 12] Nanocomp Technologies
(Concord, NH; $5.4M SBIR) nanomaterials company, has raised $7.7 million
of a planned $25 million new financing round, federal
documents show. ... In November, Nanocomp was
chosen to supply its yarn and sheet material made from
carbon nanotubes to the U.S. government under a
Department of Defense program that helps manufacturing
companies meet anticipated federal needs for their
products.[Rodney Brown, Mass High Tech, Jan 6,
12] American Science and Engineering said it has received an order for five of its Z Backscatter Vans from a law enforcement agency in South America. [Chris Reidy, Boston Globe, Jan 6, 12] Blend Therapeutics
(Watertown, MA) announced
its launch as a biotechnology company that aims to focus
on so-called “combination medicines.” Company
founders include Robert Langer, David H. Koch Institute
Professor at the Massachusetts Institute of Technology;
Stephen Lippard, the Arthur Amos Noyes Professor of
Chemistry at MIT, and Omid Farokhzad of Harvard Medical
School. Their specialties include chemistry and
nanomedicine. [Chris Reidy, Boston Globe,
Jan 6, 12]
We are today
living in what the scholar Shoshana Zuboff has labeled
“the age of the smart machine,” in which technology is
increasingly able to substitute for more and higher
human functions. Every great advance for Silicon
Valley likely means a loss of low-skill jobs elsewhere
in the economy, a trend that is unlikely to end
anytime soon.
InterMune up 10%
[Jan 5, 12] Mirador Biomedical
(Seattle, WA; no SBIR) has
won FDA clearance to market its medical device for
a new set of uses, which doctors have been asking
about for months. Mirador said today that its
digital pressure sensor technology, which it calls its
Compass platform, is now cleared by the FDA for
a half dozen different medical uses. ...Mirador got
its first FDA approval after less than two years of
work, and little more than $1 million of investment.
Last April, Mirador pulled in another $1.5 million in
financing for its commercial plans.
[Luke Timmerman, xconomy.com, Jan 5, 12] Invent a robot, make
more enemies than friends. The United States faces a
protracted unemployment crisis: 6.3 million fewer
Americans have jobs than was true at the end of 2007.
And yet the country's economic output is higher today
than it was before the financial crisis. Where did the
jobs go? .... new research is showing that
advances in workplace automation are being deployed at a
faster pace than ever, making it more difficult for
workers to adapt and wreaking havoc on the middle class:
the clerks, accountants, and production-line workers
whose tasks can increasingly be mastered by software and
robots. [David Talbot, Technology Review,
J/F12] Go ahead, ask the USG for a subsidy to
develop a tech tool that raises productivity (=cuts
manufacturing labor), especially if you can prove large
commercial demand to a gullible government. Satcon Technology
($35M SBIR since 1986)
said it will cut 140 employees [about 35 percent of its
worldwide workforce] globally, close its Canadian plant,
and reduce other costs in an effort to improve its
financial performance [Lori Valigra,
Mass High Tech, Jan 4, 12] They hope for a lot more
than the present $0.58 per share, down from a high of 40
in 2000. For the last three years, it has lost a total of
$53M. biotech startup
ImmuneXcite
(Cambridge, MA; no SBIR) has taken in $2.48 million in the company’s
first institutional funding round, according to a
federal document. .... developing a product platform
that will cause an excited immune response to things
like cancer cells, based on the research of co-founder
and chief scientific officer Ifat Rubin-Bejerano, a
senior researcher at the Whitehead Institute at MIT.
According to the presentation, Rubin-Bejerano discovered
a polysaccharide that is found on the cell walls of
fungal cells, which triggers the body’s immune response
to such cells if there is a fungal infection.
[Rodney Brown, Mass High Tech, Jan 4, 12] Clearside Biomedical
(Atlanta, GA; no SBIR) startup
co-founded by a former Inspire Pharmaceuticals (no SBIR either) executive
has raised $4 million in funding from investors ... its
pharmaceutical research-and-development work will be
based in the Triangle .... owns the rights to a
micro-needle used to deliver drugs to the back of the
eye and the retina that was developed by scientists at
Emory University and the Georgia Institute of
Technology. [David Ranii, Raleigh News
& Observer, Jan 4, 12] Universal Display
down 11% [Jan 3, 12] Senomyx up
10% [Jan 3, 12]
As economies mature, manufacturing jobs sooner or later shrink, with or without globalization [as] people tend to spend less on goods and more on services [and] productivity growth tends to be higher in manufacturing than in services. ... U.S. workers who lose their jobs due to globalization have to take a 20 percent pay cut, on average, to get their next job, the worst decline of any country in the Organization for Economic Cooperation and Development (OECD) [Richard Katz, Foreign Affairs, Jan 12] Regardless of the economics, the politicians will talk as if they know how to fix the jobs situation. In fact, their explanations and policies tell that they know next to nothing and expect voters to respond to their focus-group tested patter. biotech startup Permeon Biologics (Cambridge, MA; no SBIR) has taken in $2.5 million in an equity and debt financing round .... looking to develop therapies based on the discovery of a class of proteins that will allow protein-based therapies otherwise too complex to finally get inside a cell wall. The company was founded by Harvard University professor and Howard Hughes Medical Institute investigator David R. Liu, also the founder of Ensemble Therapeutics (no SBIR). [Rodney Brown, Mass High Tech, Dec 30, 11] GMZ Energy
(Newton, MA; no SBIR) has
raised another round worth $4.5 million, based on
federal filings. ... developing thermoelectric
materials based on nanotechnology developed at MIT
[Rodney Brown, Mass High Tech, Dec 30, 11] Boston Therapeutics (Manchester, NH; no SBIR), a developer of diabetes therapeutics, announced that it has secured its first purchase order for distribution of the dietary supplement Sugardown in Italy. [DC Dennison, Boston Globe, Dec 30, 11] A public company ... a leader in the field of glyco-pathology, a specialized field involving understanding the importance of carbohydrates in biochemistry and progression of diseases. [Thestreet.com] Dart Therapeutics
(Great Barington, MA; no SBIR), a company the Wall Street Journal profiled in
its health blog this week as a “do-it-yourself drug
development” company focused on developing treatment for
Duchenne muscular dystrophy and funded by patient
organizations.... the DIY company model that Dart
has adopted has led to the formation of a new company, Halo
Therapeutics (no SBIR), after Dart bought the drug
halofuginone as a potential treatment for DMD. And the
model could potentially serve other rare disease drug
programs. [Michelle Lang, Mass High Tech,
Dec 30, 11] Advice with a cuppa.
Joshua Baer,
36-year-old entrepreneur arrived here in 1999, recruited
out of Carnegie Mellon University's School of Computer
Science by Trilogy
Inc. Since then, he has sold one company and started two
more, and invested in more than 25 local startups and
advised countless entrepreneurs. His efforts to mentor
Austin's newest wave of young companies include formal
projects, such as the launch of tech accelerator Capital
Factory, as well as informal ones, such as weekly office
hours at West Lake Hills coffee shop Lola Savannah,
where anyone can schedule a free 20-minute business
brainstorming session. My hobby is startups. I don't
watch sports or anything like that." [Lori
Hawkins, Austin American Statesman, Jan 1]
Building out the US
economy and resuscitating America's social contract with
workers and the non-financial sector will require a
massive shift in thinking and policy about industrial
and domestic innovation policy. China is is
driving realities in the global economic sphere today;
not the United States -- and America, to revive its
economy, needs to figure out how to drive Chinese-held
dollars (along with German and Arab state held reserves)
into productive capacity inside the United States while
not giving away everything. [Steve Clemons, The
Atlantic, Dec 28] Massive shifts means abandoning the
earmarking for interest groups (like SBIR recipients) and
using economic criteria for government support of
inovation. Oh, don't worry; as long as politicians
are elected to office, interest groups will get their
claimed fair share. in a culture that’s
gone from speaking to shrieking, bad news is more
welcome than good news. [Allan Sloan, Wash
Post, Dec 31] 2011 was the year that Americans were
constantly told to avoid getting their hopes up.
... Why can't we have 24 hours to enjoy the
declining unemployment rate, the faster housing starts,
the soaring stock market, the burgeoning GDP?
[Joe Queenan, Wall Street Journal, Dec 31] Alexion Pharmaceuticals
(Cheshire, CT; $1.7M SBIR, founded 1992, Phase II
SBIR in 1995), the maker
of a drug for a rare blood disease, agreed to acquire
closely held Enobia Pharma (Montreal, Canada) for as
much as $1.08 billion, adding experimental treatments
for genetic metabolic disorders. Last May, Enobia
announced plans to open a US office in Cambridge. [Bloomberg
News, Dec 29, 11] Went public in 1996, traded as low
as $1.5, now has $13B market cap at around $70. Overall government
research spending (relative to G.D.P.) has been heading
down since its peak in the space-race years of the
1960s. And because it’s nearly impossible to imagine
Congress significantly increasing research financing,
any growth in long-term R. and D. will be, largely, up
to the private sector. And that’s the real problem. From
a C.E.O.’s perspective, long-term R. and D. is a lousy
investment. The projects cost a lot of money and often
fail. And even when they work, some other company can
come along and copy all the best ideas free.
[Adam Davidson, new York Times, Dec 28] Despite the massive
injections of public funds, banks are clearly not
lending to small businesses, the vital source of
economic recovery. Indeed, the vast government
borrowings are 'crowding' private corporations out of
funds available for lending. [John Browne,
safehaven.com, Dec 28] So, since the government
policy is not working, the solution is more of it. Any
beneficiary of a government handout knows that more is
better. if the crises of the
past several months have taught us anything, it’s that
despite the allure of a new Asian currency champion,
despite the potential for the European project to be
saved, despite the weakness of the dollar and the gains
in gold over the last decade, when large institutional
investors truly get scared, they buy
U.S. dollars. [David
Callaway, Market Watch, Dec 28] as Art Laffer recently estimated, reduced
marginal tax rates may roughly be considered 10 times as
important as reduced regulatory costs, and stable money
may be considered 10 times as important as reduced tax
rates. [Peter Ferrara, Forbes, Dec
29] Enjoy our advantage of the American economy and
American governance. Ignore the many doomsayers raising
alarms in search of public office. Medrobotics (Raynham, MA; no SBIR) developer of robotic snake technology, has taken in $6.48 million of a total $10 million offering of debt and option, warrant, or other right. ... a spinout of Carnegie Mellon University that was previously known as Cardiorobotics ... developing robotic technologies for surgical and interventional applications, including minimally invasive cardiac surgery. Its main product is the cardioARM, a snake-like robotic probe controlled remotely. It is designed to enable surgeries with minimal or no incisions. [Lori Valigra, Mass High Tech, Dec 28, 11] biotech startup Daktari
Diagnostics (Cambridge, MA; no SBIR) has raised $5 million of a
planned $10 million financing round made up of equity
placement and debt, federal documents show. ... working
on a low-cost HIV point-of-care test that can perform
critical CD4 white blood cell counts, to be used to
monitor the effectiveness of AIDS treatments in
developing countries. [Rodney Brown, Mass
High Tech, Dec 28, 11] Some Bay State largesse.
The Massachusetts Life
Sciences Center, a quasi-public agency tasked with
implementing the state’s ten-year, $1 billion Life
Sciences Initiative, today announced the awarding of
$2.2 million in loans [$750K each] to three early-stage
life sciences companies. Intelligent Bio-Systems,
(Waltham, MA; $6.3m SBIR) DNA sequencing company with a patented, higher
performance, lower cost, DNA sequencing instrument and
consumable system; Allurion Technologies,(Wellesley, MA; no
SBIR) company that is
developing a novel medical device designed to induce
significant weight loss by displacing volume in the
stomach. The device can be delivered without surgery and
it can be eliminated via an orally available, non-toxic
dissolution agent; and Paragonix Technologies,(Cambridge, MA; no
SBIR) company that is
commercializing first-in-class, single-use and highly
portable organ preservation and transport devices called
‘Sherpas.’ Paragonix has begun with a Sherpa for kidney
transport, but is planning to expand their ‘Sherpa’
product line for other organs. [DC
Dennison, Boston Globe, Dec 28, 11] OnChip Power
(South Boston, MA; no SBIR) boosted its Series A fundraise by an additional
$1 million, bringing the company’s first round to $2.8
million. ... developing technology that would
allow for a smaller, less costly power supply for LED
bulbs, in an effort to help drive greater adoption of
the energy-saving lighting option. [Rodney
Brown, Mass High Tech, Dec 27, 11] The Belmont Rapid
Infuser, manufactured in Billerica, was just used in the
first ever liver transplant in Iraq. The trip was
sponsored by The Red Crescent and Zheen International
Hospital. Two young brothers were involved in the
living-donor transplant surgery, which was
successful, according to the company. The Rapid Infuser
is manufactured by the Belmont Instrument Corporation (Billerica,
MA; $400K SBIR in 1990s). [DC Dennison, Boston
Globe, Dec 27, 11] Cardeas Pharma (Seattle, WA; no SBIR) Obtains $5,000,000 New Funding Round ... stealth mode pharmaceutical developer. ... plans to use the money to run both preclinical experiments and initial clinical trials of a novel therapeutic to be used in hospitals. [xconomy.com, Dec 21, 11] Next year could be a
fundraising drought for promising medical device
start-ups in Minnesota. Venture capitalists are
feeling less confident about making investments in 2012,
with 58 percent of them predicting fewer investments in
biopharmaceutical and medical device businesses,
according to a national survey from the National Venture
Capital Association. [Wendy Lee, Minneapolis Star
Tribune, Dec 27] Tougher plants than
thought. The
Environmental Protection Agency said Tuesday that a tiny
fraction—less than one-tenth of 1%—of renewable fuels
required to be used in the U.S. next year will come from
cellulosic biofuel, based on projected production
volumes, despite a congressional target that the fuel
made from plant stalks and other inedible materials
account for more than 3% of the total. The
disappointment gets worse as "Once again, refiners are being ordered to use
a substance that is not being produced in commercial
quantities—cellulosic ethanol—and are being required to
pay millions of dollars for failing to use this
nonexistent substance. This makes no sense," he said. The
developers were glad to get the federal subsidies after
promising delivery and are now hoist on their own petard
for failing to deliver. At least SBIR never imposes such
penalties on failure. Thriving and complaining. we have a structural jobs issue, but not an issue of making things and innovating. American manufacturing remains highly productive and a significant component of economic vitality, but it employs far fewer people (12 million or so and declining) and far more technology. It is a pillar of the statistical economy but not of employment. So too are the wondrous new worlds of Silicon Valley and social media, which thrived in 2011 and will continue to into 2012, but which primarily benefit those already doing well (if you can afford an iPhone and use one, you tend to have a college degree and do not face the same job challenges as a high-school-educated construction worker). In the year ahead, the gap between the digital haves and have-nots is likely to grow along with income inequality, but in a country of 300 million people, the number doing well exceeds the number struggling by a considerable margin. Not a reason to back-pat, but not cause for ritual group-excoriation either. [Zachary Karabell, The Daily Beast, Dec 27] The complaints come from a population still living in the dream of post-WWII prosperity and demanding more government than they are willing to pay for. While their elected representatives have no great incentive to tell them that their dreams will not be coming true. Even programs like SBIR engage in the same illusion that more money can be diverted into their pockets without hurting the government programs that pay the bills. More for me, and send the bill to ..... Ferrate Treatment
Technologies (Orlando, FL ; one SBIR) plans to use a chemically
unusual form of iron to clean water up, not make it
dirty. ... A machine small enough to be carried around
in a pickup truck, Mr Daly claims, could generate enough
ferrates to purify 75m litres (20m American gallons) of
water a day. The system is now being tested at two
plants in Florida. [The Economist, Jan 20,
11] The Flaum Eye Institute
at the University of Rochester Medical Center has
launched a new initiative to accelerate the development
and commercialization of new technologies. Called
the Excubator, the initiative builds on the region’s history
of innovation in eye care, optics, software, and
engineering to launch a new generation of technologies
to treat diseases of the eye, officials
said. The Excubator will be a private
company jointly owned by URMC and private investors, and
it is designed to reduce the steep risk normally
associated with high-tech startups by placing these
ideas in the hands of businesses with a proven record of
developing new technologies. [Rochester
Business Journal, Dec 22]
In 1980, Abraham Karem,
an engineer who had emigrated from Israel, retreated
into his three-car garage in Hacienda Heights outside
Los Angeles and, to the bemusement of his tolerant wife,
began to build an aircraft. The work eventually spilled
into the guest room, and when Karem finished more than a
year later, he wheeled into his driveway an odd,
cigar-shaped craft that was destined to change the way
the United States wages war. The Albatross, as it
was called, was transported to the Dugway Proving Ground
in Utah, where it demonstrated the ability to stay aloft
safely for up to 56 hours — a very, very long time in
what was then the crash-prone world of drones.
Three iterations and more than a decade of development
later, Karem’s modest-looking drone became the Predator,
the lethal, remotely piloted machine that can circle
above the enemy for nearly a day before controllers
thousands of miles away in the southwestern United
States launch Hellfire missiles toward targets they are
watching on video screens. [Peter Finn,
Washington Post, Dec 23] If SBIR had existed in
1980, Karem couldn't have got one since he was not a US
citizen in a political world that favors home cooking,
however mundane. Momenta Pharmaceuticals developer of novel and
generic drugs, has formed a $33 million collaboration
deal with Baxter International that could balloon to more
than $450 million with possible milestone payments
included. [Michelle Lang, Boston
Business Journal, Dec 23, 11] A123 Systems said it found a “potential safety issue” in batteries it supplies to Fisker Automotive Inc. A123, which also sells batteries to automakers such as General Motors Co. and Daimler AG, said hose clamps that are part of the internal cooling system of its batteries supplied to Fisker were “misaligned” and may cause coolant to leak. Such a leak could lead to an electrical short circuit. [Craig Trudell, Bloomberg, Dec 23, 11] Mercury Computer Systems (Chelmsford, MA; no SBIR, market cap $400M) will pay $70 million to acquire a pair of companies that make electronic warfare and intelligence-gathering systems. Mercury is buying KOR Electronics (Cypress, CA; $6.8M SBIR mostly USAF) which makes digital radio and radar test gear, as well as Paragon Dynamics (Aurora, CO; no SBIR), which provides intelligence analysis and exploitation services. [Hiawatha Bray, Boston Globe, Dec 23, 11] Acceleron Pharma’s
(no SBIR) development
and commercialization collaboration with New Jersey
partner Celgene continues to pay off in the
form of funding for the Cambridge biomedical company.
... co-founded in 2004 by Christoph Westphal, life
sciences-focused serial entrepreneur [Michelle Lang, ,
Mass High Tech, Dec 23, 11] Provenance
Biopharmaceuticals (Waltham, MA; no SBIR) has raised $8 million from
brand new stealthy health care products acquisition
company Allopexx Enterprises LLC to fund development of
an anti-cancer therapy. [Rodney
Brown, Mass High Tech, Dec 23, 11] Many of the people laid
off by the large companies [Kodak, Xerox, GM, Bausch
& Lomb] in Rochester [NY] are highly trained
engineers who have started their own companies and live
in the upscale neighborhoods of Pittsford, Penfield and
Brighton. Some have left the engineering world behind as
they made the transition from company man to
entrepreneur. ... iCardiac Technologies
(Rochester NY; no SBIR)
which measures cardiac side effects of prescription
drugs, has grown to 50 employees and receives a steady
stream of resumes during these times of high
unemployment nationwide, many from current and former
Kodak employees. .... private-equity
firm Trillium Group has helped fund a number of
start-ups, including iCardiac and Thermal Gradiant
(Rochester, NY; no SBIR), a molecular diagnostic company started in 2004
by two people who worked at a Kodak spinoff bought by
Johnson & Johnson. [Dana Mattioli, Wall
Street Journal, Dec 24, 11] If Congress really
wanted a jobs engine, it would seriously re-structure SBIR
to push more awards to such start-ups with economic
potential and away from SBIR junkies that have a
semi-permanent relationship with the large agencies. A $7 million tranche of
funding for GMZ
Energy, (Newton, MA; no SBIR) heat-to-electricity
technology firm, appears to be one of the largest energy
VC rounds of the quarter. ... produces
thermoelectric materials based on nanotechnology
developed at MIT and Boston College. The company said
the new funding would be used to accelerate its
engineering and commercialization efforts. [Kyle
Alspach, Boston Business Journal, Dec 21, 11] With a pending initial public offering, Aspen Aerogels (Northborough, MA; $17M SBIR) raised $15 million in debt, options and warrants, with a planned top end of $25 million, according to a regulatory filing. ... founded in 2001, develops and markets as aerogel technology used for insulation products in a variety of markets, including oil and gas; building and construction; outdoor gear and apparel; solar thermal; appliances; and transportation. [Rodney Brown, Mass High Tech, Dec 22, 11] A company that designs
surveillance cameras for the military has moved from the
suburbs of Boston to Putnam, winning $1 million in
venture funding from Connecticut Innovations, the
state's quasi-public authority that invests in
technology firms. RemoteReality (Westborough, MA; $2.7M
SBIR) also received
venture capital from a private VC firm, Kuwait Holdings
and an individual investor. RemoteReality, which
has received more than $10 million from the Pentagon to
advance its technology, is looking to hire
engineers. [Mara Lee, Hartford Courant,
Dec 22, 11] Lingering
in nursery. A small Wheat Ridge company has
landed three NASA awards to develop devices that could
be used on deep-space missions and for maneuvering
satellites. ... TDA Research has
85 employees, serves a number of military and
aerospace customers and earns a share of its $11.6
million in annual revenues from NASA projects.
[Ann Shrader, Denver Post, Dec 23, 11] How touching -
small company, the heartthrob of our politicians, gets
government help! This touching small company has
touched Uncle Sam for at least 378 SBIR projects funded
with guessed average of $400K and a total guess of
nearly $150M of which $6M came in 2010.
Government encourages college-age kids to stay in
nursery school. Cell Therapeutics paid off $11.2 million to retire all of its outstanding convertible debt. [Valerie Bauman, Puget Sound Business Journal, Dec 19, 11] Even economists who claim that these policies stimulate—such as those at forecasting firm Macroeconomic Advisers—admit that they cost jobs as they are turned off, leaving the recovery no better off. [John Taylor, Wall Street Journal, Dec 21] Could he be talking about SBIR created jobs lasting only as long as the SBIR money keeps coming in? Actually, no, he was talking sbout temporary tax breaks. ImmunoGen added yet another collaboration deal, this time working with Eli Lilly and Co. to develop anticancer therapeutics under an agreement that could bring in up to $200 million or more to ImmunoGen. Staring with an up front payment from Lilly of $20 million, ImmunoGen will apply its Targeted Antibody Payload (TAP) technology to monoclonal antibodies from Lilly’s library to make these new antibody-drug conjugate (ADC) cancer-fighting therapies, the companies said [Rodney Brown, Mass High Tech, Dec 20, 11] Excelimmune(Woburn, MA; one SBIR, founded 2006) working on a treatment for methicillin-resistant Staphylococcus aureus (MRSA), has rounded up $12 million from an undisclosed private investor. [Michelle Lang, Mass High Tech, Dec 20, 11] Metamark Genetics(Cambridge, MA; no SBIR, founded 2007) and Janssen Biotech (Horsham, PA; no SBIR), a therapeutics developer, have formed a research, collaboration and licensing deal that could bring [Metamark] molecular diagnostics company up to $365 million in milestone payments. [Michelle Lang, Mass High Tech, Dec 20, 11] Grove Instruments (Worcester, MA; $400K SBIR) closed an oversubscribed $6 million Series B Preferred Stock offering, according to a news release from the developer of a noninvasive blood glucose meter. [Michelle Lang, Mass High Tech, Dec 20, 11] American Superconductor up 16% [Dec 20, 11] II-VI up 11% [Dec 20, 11] Progenics Pharma up 31% [Dec 20, 11] after [Progenics and Salix] said a late-stage study for an expanded use of the constipation treatment Relistor yielded positive results. [AP, Dec 20] Targacept down 36% [Dec 20, 11] said that their experimental depression drug TC-5214 failed in a second late-stage clinical trial. [AP, Dec 20] Trius Thera up 10% [Dec 20, 11] said its new antibiotic tedizolid phosphate performed well during the first of two Phase 3 clinical trials, and that the second trial will be completed late next year. [Gary Robbins, signnsandiego,com, Dec 20] Repligen said it has completed the acquisition of the business of Novozymes Biopharma Sweden AB, the Swedish unit of Novozymes Biopharma. The all-cash transaction, which was announced in October, had Repligen making an upfront payment of $22.7 million. [Chris Reidy, Boston Globe, Dec 21, 11] Agilyx (Beaverton, OR; no SBIR) that converts waste plastic into crude oil has landed $25 million in investment, anticipating an expansion and, ultimately, a stock listing. ... "We don't see ourselves needing to do another private round," said Chris Ulum, Agilyx's chief executive [Richard Read, The Oregonian, Dec 19, 11] ClearEdge Power (Hillsboro, OR; no SBIR) a fuel-cell maker that raised $73.5 million in August. [Richard Read, The Oregonian, Dec 19, 11] Correx (Waltham, MA; no SBIR, founded 2004),bumped up a previously announced funding round, taking in about $3.3 million of a planned $4 million financing, the company indicated ... makes a device designed to help surgeons access the heart during aortic valve bypass. [Michelle Lang, Mass High Tech, Dec 19, 11] Dicerna Pharmaceuticals
(Watertown, MA; no SBIR) said that Kyowa Hakko Kirin Co. Ltd., or KHK,
has elected to advance its first collaborative oncology
candidate from the research stage into formal
development studies, a move that triggers a $5 million
milestone payment for Dicerna. [Chris Reidy,
Boston Globe, Dec 19, 11] venture-backed RNA
interference (RNAi) company developing novel therapeutic
agents and related drug delivery systems in multiple
disease areas based on its proprietary Dicer
Substrate Technology™ platform and Dicer Substrate siRNA
(DsiRNA) molecules. Dicer Substrate Technology is a next
generation RNAi approach that results in greater
potency, longer duration of action and enhanced delivery
potential, differentiating it from other RNAi approaches
[company website] Superconductor
Technologies begins work early next year to convert a former
chip industry site into a pioneering factory for
next-generation superconducting wire.The plant will
employ a few dozen people next year and expand to about
135 over the next few years.The company chose Austin
because of its reservoir of experienced semiconductor
manufacturing engineering talent and available
clean-room-equipped buildings, such as the former
Applied Materials building. .... an investment
banker, said STI has a far better manufacturing process
than rival companies. "They can produce the wire at
one-tenth the cost" of other companies, Conley
said. [Kirk Ladendorf, Austin
American Statesman, Dec 19, 11] Let’s say you are that
ambitious postdoc at the Salk Institute, or that
microbiologist picking up a business degree at Rady or
San Diego State, what
should you expect from [VC Steve]Jurvetson?
... What will be waiting for you and your business
plan? We look for people with infectious
enthusiasm,” he replies, “individuals who convince us
that they have the best thing ever. That make us jump
out of our seats. We look for intellectual agility and,
frankly, for enough self-confidence that you can still
be humble, that you don’t pretend to have all the
answers like a salesperson.” There’s got to be
that dream of innovation, an explanation of how “what
you got” will change the world in 20 years. But don’t
forget, this is no longer just about research science,
not when you step out of the cab. VC’s are into 10X
returns, with 100X oh-so-much-sweeter. [Steve
Chapple, signonsandiego.com, Dec 19] To make life
easier for San Diegans on Biotech Beach, Jurvetson is
moving money South from Silicon Valley. Long-term evidence
indicates that the starve-the-beast
strategy not only fails, but may make the
problem of unrestrained spending growth worse,
suggesting that a "serve the check" strategy might be a
more effective means of curbing the growth of government
spending. The simple explanation for this seeming
paradox is that the starve-the-beast strategy currently
allows Americans to receive a dollar in government
services while only having to pay 60 cents for it. Rigorous analyses from
centrist economists Christina and David Romer of UC
Berkeley, and
from libertarian economist (and Reagan White House
alumnus) William Niskanen conclude that the
starve-the-beast strategy fails. Strikingly, Niskanen's
analysis found that lower taxes correlated with higher
levels of federal spending. As a result, Niskanen argues
that raising taxes may be the most effective way to
reduce government spending. [Steven
Hayward, Breakthrough Journal, Issue 2] The essay on
conservatism got a Sydney Award from columnist David
Brooks who annually praises the best essays he finds in
the year. In the Archives
helping small high-tech companies get from idea to marketPrepared by Carl Nelson Consulting Inc, carl@carl-nelson.com; http://www.carl-nelson.com |
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