Wellcome Trust-funded research innovations are now being guided to possible commercial development. Martin Ince reports
The "funding gap" is like the weather. Everyone - academics, industrialists, peers in House of Lords' reports - complains about it, but nobody does anything about it. Now the Wellcome Trust, one of the few bodies that has enough money to try to cure it, is doing just that.
The gap is the tricky point in the life of a new discovery where it is getting beyond the stage of being a laboratory finding but is still too much of a gleam in the discoverer's eye to attract big money from commercial backers.
Wellcome's answer to this conundrum is Catalyst BioMedica, a firm set up over a year ago and now starting to do deals. Its managing director, Graham Fagg, who came to Wellcome after a career in academic research and in the pharmaceutical industry, says that July 1998 marked the real start of Catalyst, with the appearance in Wellcome Trust grant conditions of clauses that gave Catalyst the role of developing research results from work funded by the trust.
Fagg is careful to reassure academics that Catalyst's intentions are honourable. The intellectual property rights flowing from Wellcome-funded research in universities remain with the institutions, and it is open to researchers to use other routes to commercialisation if they wish.
He is happy for research team leaders with promising findings to talk to their own university's technology transfer office first. On the vexed question of the ownership of intellectual property, Fagg points out that universities often risk the full ownership of the discoveries they make by ill-defined contracts with visiting staff, contract workers and others, something he hopes Catalyst will help them to improve.
The 1936 will of Sir Henry Wellcome, founder of the trust, is still its basic document, and enjoins it to promote human welfare. As Fagg sees it, Wellcome is promoting its charitable objectives via Catalyst, by applying research funded by the trust, which is also good for relations with the Charity Commission.
Wellcome had been interested in developing the research it funds for some years before Catalyst was set up. But it was the vast expansion of the trust in the early 1990s, caused by the trust reducing its stake in the Wellcome drugs firm in favour of higher-yielding investments, which propelled its asset base towards its current Pounds 12 billion and its annual spend into the hundreds of millions, that made it clear that something had to be done.
Fagg says: "We used to have a commercial relationship with CRC Technology [set up by the Cancer Research Campaign with similar objectives to Catalyst]. But the trust decided to have its own operation because we realised that we have been great at research but less good at turning it into healthcare."
The objective of Catalyst is not so much to make money for Wellcome as to ensure that the technology it pays for gets into use. By "technology" Catalyst could mean anything from a drug delivery system to a specific drug. But usually, says Fagg, the outcome of a Wellcome grant is "some improved biological understanding", for example of a disease or of a physiological process. Some but not all show the way to a new drug discovery.
One of the first Catalyst deals to reach fruition is the formation of a new biotechnology firm involved in human genetics, Oxxon Pharmaccines, in the area of human vaccines and immunology. It arises from work funded at Oxford by Wellcome and the Medical Research Council and is backed by two venture capital firms.
In this case, Catalyst has helped set up a new firm, but in others it could help establish licensing agreements with other companies, help negotiate agreements with them and monitor progress afterwards. At the moment, says Fagg, the firm has "about 15 technology transfer agreements in place". Each requires a lot of attention and the company has only eight staff.
Fagg says that Catalyst BioMedica "does not normally provide finance because we are not a venture capital group". But it does have a Pounds 20 million development fund of Wellcome money of which it is in effect the fund manager. There have been seven awards totalling Pounds 2 million and more are in the pipeline, worth up to about Pounds 500,000 each. They cover fields from diabetes and cancer therapy to Alzheimer's disease.
Fagg says: "There are plenty of ideas that need to be made more attractive before they can be commercialised. The problem could be that there needs to be more work on patents or intellectual property. But it could be that another year of research is needed." So the key to building interest in the new technology might be anything from a lawyer to some laboratory time.
Asked about areas of prime interest to Catalyst, Fagg points out that the pharmaceutical industry is constantly on the hunt for "validated targets", receptors or proteins against which a vaccine can be directed with a predictable effect.
Scientists, he says, have a constant flow of target ideas but the steady growth in our knowledge of the human genome is making the hunt for them more systematic. "Now we are finding individual receptors and enzymes and understanding their role in protein production."
This approach chimes with the rest of the Wellcome Trust approach, especially its plans for the "Genome Campus" near Cambridge where the trust wants to assemble a cluster of genomics-based firms. Many of the firm's agreements are with Oxford or Cambridge scientists.
These plans might well lead to products of immense commercial potential. But Fagg adds that Wellcome has always had an interest in areas like tropical medicine where the profit potential is less but the human need immense. Here, he says, Catalyst has had some preliminary talks but needs to think harder about different ways of making research usable.
"That is one of the things we would like to get involved with, but first we must show some success in our main business," he says.