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The Massachusetts Life Sciences Center

Science Shaping Our WorldJanuary 17, 2013

Dr. Susan Windham-Bannister,President & CEO

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Overview

About the Massachusetts Life Sciences Cluster

Trends and Challenges Driving the Need for Innovation

The Massachusetts Life Sciences Initiative: A Strategic Investment in the State’s Innovation Ecosystem

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About the Massachusetts Life Sciences Cluster

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Massachusetts: The Global Leader in Life Sciences

The Massachusetts Life Sciences Cluster: The world’s leading innovation pipeline: #1 Life Sciences Cluster (Jones

Lang LaSalle), and #1 in biotech construction (Richards Barry Joyce)

World-class academic and medical institutions leading the way in life sciences research

A talented workforce

Business-friendly Infrastructure (International airport with 40 airlines, regional rail service, mass transit and five deepwater ports)

All industry sectors -- biotechnology, pharmaceuticals, medical devices, diagnostics and bioinformatics

Government leadership, through our state’s 10-year, $1 billion Life Sciences Initiative (enacted by the Massachusetts Legislature in June 2008)

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37,490

53,253

2002

2011

42%GrowthSince2002

Source: U.S. Bureau of Labor Statistics, Quarterly Census of Employment and Wages (QCEW)

Life Sciences are Critical to Our Economy

Over 80,000 Massachusetts employees work in the life sciences sectors*

Total employment in the Massachusetts life sciences sectors continues to grow despite a challenging economy

*excludes health care delivery

Employment growth in the MA biopharma sector

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Source: 2010 PricewaterhouseCoopers, National Venture Capital Association, MoneyTreeTM Report, Historical Trend Data, MassBio analysis.

In 2010, Massachusetts

biopharma companies received nearly one-quarter of all U.S. VC biotech investment –

an all-time high.

Massachusetts’ medical device firms received 12 % ($286

million)

The percentage of investments in start-up and seed stage

companies has increased

dramatically

12.0

15.9

19.520.8

23.1

16.9

0

5

10

15

20

25

2000 2002 2004 2006 2008 2010

Perc

enta

ge

Percentage invested at Start-up/Seed

Stage2002 5.4%

20064.8%

2010 21.9%

Massachusetts’ Venture Capital Dollars Encourage Company Start-ups

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Therapeutic Area Candidates

Genito-Urinary 19

Respiratory 19

Blood 25

Endocrine 29

Dermatology 33

Gastro-Intestinal 36

Sensory Organs 36

Cardiovascular 42

Musculoskeletal 46

Various 57

Central Nervous System 130

Systemic Anti-infectives 134

Oncology 349

Total (R&D) 955

Massachusetts Pipeline, by Therapeutic Area

Source: EvaluatePharma®

Drugs in development in Massachusetts address

nearly every therapeutic area – especially oncology

The Massachusetts Drug Pipeline Will Help Improve Global Health

Courtesy of MassBio Industry Trade Association 2012

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Top 5NIH fundedResearchHospitals

Top 5NIH funded

Research

Hospitals

430+Biotech

Companies

122Colleges &Universities

1stin

Venture Capital & SBIR funds

per worker

1stin

Education Level of

workforce

500Biopharma

Companies

122Colleges &

Universities

1stin

Venture Capital & federal research

funds per worker

1stin

Educational Level of

Workforce (US)

Why is Massachusetts So Successful in Life Sciences?

Life sciences innovation thrives in

Massachusetts because of the great

concentration of universities, research hospitals, educated

workers, entrepreneurs, mature companies and a

strong investment community.

400Medtech

Companies

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Trends and Challenges Driving the Need for Innovation

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Current Trends and Challenges Create Market Needs

Market Trends/Challenges

MA Health Reform “2.0”

U.S. National Health Reform (ACA) Pressure on Reimbursement

New Models of Provider and Payor Organization

Threats to Research Funding from U.S. Federal Agencies (e.g., NIH)

Population Demographics Re-shoring to U.S. of Advanced

Manufacturing “Broken” Model of Drug Discovery

and Development Emerging Markets and Disease

Profiles Regulatory Changes

Market Needs/Opportunities

Combination Products

Collaborations and Consortia Demonstrating Clinical Value to

Support Drug Commercialization

Genomics

Informatics

Mid-level Skill “Solutions”

Open Innovation Personalized Medicine and Cell

Tx Point of Care Diagnostics and

Devices

Remote Sensing and Monitoring

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“Big Pharma” Faces Significant Challenges

Drug pipelines are running dry

Many “blockbuster medicines” are about to lose patent protection

Traditional drug-development processes at big pharma are expensive and inefficient Models have not changed significantly from the late nineteenth century

-- synthesize and screen thousands of compounds in search of a few new drug candidates

The traditional business model at big pharma also is expensive and inefficient: Identify promising new blockbuster drugs Conduct large, expensive clinical trials If successful, promote the drugs with extensive marketing and sales

presence in developed countries

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Manifestations of the Problem

Internally developed pipeline productivity at big pharma has decreased significantly -- averaging one new molecular entity a year per company

…And…

The cost of bringing a new drug to market has continued to rise -- currently estimated to exceed $1 billion

……But……

The timeline for developing and getting a drug to market has not declined -- can take as long as 15 years

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Current Challenges and Opportunities are Creating an “Innovation Crisis”

How do we get “better” at innovation:Pace

Cost and Risk ReductionSuccess Rates

Significant Breakthroughs

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The Massachusetts Life Sciences Initiative: A Strategic Investment in the State’s Innovation Ecosystem

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The Role of State Government is Both Financial and Collaborative

Discovery Development Delivery

The Strategy:Targeted initiatives to strengthen, support and promote highly functioning

ecosystems in our key innovation sectors

The Innovation Process

ROLE OF STATE AGENCIES AND QUASI-PUBLIC AUTHORITIES: Funding Workforce development Technical Assistance Convening and collaboration Partnerships Build capacity and infrastructure Market development Research and policy

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The Massachusetts Life Sciences Initiative

Announced by Governor Deval Patrick at BIO in Boston June 2007

Enacted by the Massachusetts State Legislature and signed by Governor Patrick in June 2008

Announced at BIO in San Diego June 2008

10-year, $1B investment in the Massachusetts life sciences cluster:

Sectors

• Biotech• Pharmaceuticals• Medical Devices• Diagnostics• Bioinformatics

Stakeholders

• Academic Institutions• Industry• Industry Associations• Investors• Medical Centers• Non-profit Research Institutes

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The Massachusetts Life Sciences Center: Who We Are and What We Do

Mission:

Serve as the “hub” of the Massachusetts life sciences Supercluster

Encourage innovation through investments in good science and good business

Strengthen and protect Massachusetts’ global leadership position in the life sciences

Accelerate the commercialization of promising treatments, therapies and cures

Create jobs and drive economic development

The Massachusetts Life Sciences Center develops and offers creative programs that fund innovation-driven economic development initiatives in the Massachusetts life sciences cluster, but also may have relevance for other “innovation” sectors.

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Discovery Development Delivery

The MLSC Strategy:Fund targeted initiatives that reduces barriers, fill gaps and promote

collaboration across the life sciences innovation process. Enable MA to “innovate how innovation occurs!”

• Promote and fund convening and collaboration• Partner with and leverage private sector stakeholders• Invest in early stage companies (pipeline and external innovation)• Support workforce development and training • Build capacity, infrastructure and unique resources in Massachusetts

The MLSC’s Overall Strategy is to Invest in Gap Closure Across the Innovation Life Cycle...

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…and Coalesce the Massachusetts Life Sciences “Cluster” into a “Ecosystem”

MLSCInvestments

In a high performing

innovation clusters these components

work well individually and together as an

ecosystemTop 5

NIH fundedResearchHospitals

Top 5NIH funded

Research

Hospitals

430+Biotech

Companies

122Colleges &Universities

1stin

Venture Capital & SBIR funds

per worker

1stin

Education Level of

workforce

500Biopharma

Companies

122Colleges &

Universities

1stin

Venture Capital & federal research

funds per worker

1stin

Educational Level of

Workforce (US)

400Medtech

Companies

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MLSC Investment Tools and Programming Budget

• 10 years• $1 billionInvestment

$500

mill

ion

Cap

ital F

und

$250 million

Tax Incentive Program

$250m Investment Fund (subject to appropriation)

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Secretary of Housing and Economic Development Gregory Bialecki

Secretary of Administration and Finance Glen Shor

President of the University of Massachusetts System Robert Caret, Ph.D.

A CEO of a Massachusetts-based life sciences corporation Abbie Celniker, Ph.D., CEO, Eleven Biotherapeutics

A researcher involved in the commercialization of biotechnology, pharmaceuticals or medical diagnostic products Lydia Villa-Komaroff, Director and CSO, Cytonome/ST

A physician licensed to practice medicine in the Commonwealth and affiliated with an academic medical center Edward Benz, M.D., President & CEO, Dana-Farber Cancer Institute

A person with financial expertise in the life sciences Joshua Boger, Ph.D., Founder & CEO (Retired), Vertex

The MLSC Board of Directors

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The MLSC Scientific Advisory Board FY ‘13

CHAIR: Harvey Lodish, Ph.D., Whitehead Institute, and Professor of Biology and of Bioengineering, MIT

CHAIR: Harvey Lodish, Ph.D., Whitehead Institute, and Professor of Biology and of Bioengineering, MIT

• Gary Borisy, Ph.D., Director and CEO, Marine Biological

Laboratory

• James J. Collins, Ph.D., Professor of Biomedical

Engineering, Boston University

• John M. Collins, Ph.D., COO of Center for Integration of Medicine & Innovative Technology

(CIMIT)

• Robert D’Amato, M.D., Ph.D., Judah Folkman Chair in Surgery and Director, Center for Macular

Degeneration Research , Harvard Medical School and Boston

Children’s Hospital

• Rainer Fuchs, Ph.D., Chief Information Officer, Harvard

Medical School

• Richard A. Goldsby, Ph.D., John Woodruff Simpson Lecturer and Professor of Biology, Amherst

College

• Lita L. Nelsen, Director, Technology Licensing Office, Massachusetts Institute

of Technology

• David Walt, Ph.D., Robinson Professor of Chemistry

and Howard Hughes Medical Institute Professor at Tufts

University School of Medicine

• Philip Zamore, Ph.D., Professor, Biochemistry and Molecular Pharmacology,

UMass Medical School

• David Walt, Ph.D., Robinson Professor of Chemistry

and Howard Hughes Medical Institute Professor at Tufts

University School of Medicine

• Philip Zamore, Ph.D., Professor, Biochemistry and Molecular Pharmacology,

UMass Medical School

AcademiaAcademia

• T. (Teo) Dagi, M.D., M.B.A.Partner, HLM Venture Partners

• Jonathan Fleming, M.P.A., Managing General Partner, Oxford Bioscience Partners

• Carmichael Roberts, Ph.D., M.B.A. Partner, North Bridge Venture Partners

• Lauren Silverman, Ph.D., Managing Director of Novartis Option Fund

• T. (Teo) Dagi, M.D., M.B.A.Partner, HLM Venture Partners

• Jonathan Fleming, M.P.A., Managing General Partner, Oxford Bioscience Partners

• Carmichael Roberts, Ph.D., M.B.A. Partner, North Bridge Venture Partners

• Lauren Silverman, Ph.D., Managing Director of Novartis Option Fund

Venture CapitalVenture Capital

• James Barry, Ph.D., Executive Vice President & COO, Arsenal

Medical

• Dalia Cohen, Ph.D.,Founder and President, ALN Associates

• Dale Larson, Director of Biomedical Systems, Draper Laboratory

• James Barry, Ph.D., Executive Vice President & COO, Arsenal

Medical

• Dalia Cohen, Ph.D.,Founder and President, ALN Associates

• Dale Larson, Director of Biomedical Systems, Draper Laboratory

IndustryIndustry

• Alison Taunton-Rigby, Ph.D. CEO, RiboNovix, Inc.

• Alison Taunton-Rigby, Ph.D. CEO, RiboNovix, Inc.

EntrepreneursEntrepreneurs

• Alan Smith, Ph.D.Former Chief Scientific Officer, Genzyme a Sanofi Company

• Alan Smith, Ph.D.Former Chief Scientific Officer, Genzyme a Sanofi Company

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The “Bottom Line” Life Sciences Center’s Impact: June ‘08 – December ‘12

• Corporate Investors

• NIH

• Private Foundations

• Institutes

• Other Private Investors

• Academic Institutions

Grants to Academic Organizations and Medical Centers

Grants for “Shovel Ready” Capital

Projects

Investments in Life Sciences Companies

Public Dollars Invested/ Committed

= $312 M

Matching Investments Attracted = $1.02B

3 X multiplier

• Permanent

Job Potential = 8,754

• Building Trades

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Supporting promising scientific research ($13.6 million - matched dollar for dollar)

Funding 21 new investigators ($5.1 million)

Helping five universities and academic medical centers compete for top faculty ($3.75 million)

Funding research collaborations between eight industry and academic partners ($4.8 million)

Strengthening our World Class Academic Institutions

Life Sciences Center Research Matching Grant Program: accelerating the translation of treatments and therapies “from the research bench to the bedside”

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Incentives for companies to locate and grow jobs in Massachusetts

Center can commit up to $25 million/year

Companies commit to creating a certain number of jobs in the year following award

Fifty-four (54) active awards totaling $56.7 million to companies that have created or are promising to create more than 2,000 jobs.

Funding to match federal small business grants (SBIR & STTR)

$4 million awarded to eight life sciences companies

Working capital for early-stage life sciences companies

$15.1 million in loans awarded to twenty –four early-stage companies

Helping Life Sciences Companies Grow

Accelerator Program:

SBMG Program:

Tax Incentive Program:

Mass Challenge - $100,000 sponsor

MIT $100K Competition - $10,000 sponsor

Boston University - $5,000 sponsor

Worcester Polytechnic Institute - $5,000 sponsor

Business Plan Competitions:

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Funds interns working at Massachusetts companies with fewer than 100 employees

Nearly 1,000 interns representing 117 different colleges and universities have been placed at 307 companies across the state

More than 160 participating interns have been offered full or part-time jobs at the conclusion of their internships

Supporting Workforce Development in the Real World:Internship Challenge Program

Objective: Increase interest , skill development and employment readiness for life sciences careers by providing “real world” experience

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MLSC program for: Vocational technical schools Community colleges Workforce training organizations

Awards grants of up to $250,000 per institution for equipment and supplies that support life sciences training

Industry match is required for funding above $100,000

First round of awards made Feb 23, 2011, Second round December 19, 2012

Awards made to 63 institutions across Massachusetts; $6.6 million investment Over $1 million in additional “matching”

funds provided by industry sponsors

Supporting Workforce Development in Classrooms:Equipment & Supplies Program for Skills Training and Education

Dr. Susan Windham-Bannister, Ph.D., President & CEO, Massachusetts Life Sciences Center, and Lt. Governor Tim Murray observe a biology student checking results from an experiment at Nashoba Valley Technical High School in Westford, where the second round of equipment and supply matching grants from the MLSC was announced on Dec. 20, 2012.

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Wastewater Project at Framingham Technology Park

Renovation of the Loeb Lab at the Marine Biological Laboratory

New England Regional Biosafety Laboratory at Tufts’ Cummings School of Veterinary Medicine

The Albert Sherman Center at the University of Massachusetts Medical School

Gateway Park in Worcester

Joint Center for Personalized Cancer Therapy at UMass Boston

UMass Dartmouth Biomanufacturing Center

Dana-Farber Molecular Cancer Imaging Center

Joslin Translation Center for the Cure of Diabetes

Museum of Science Boston “Hall of Human Life”

UMass Lowell Emerging Technologies and Innovation Center

Massachusetts Accelerator for Biomanufacturing (MAB)

Making Massachusetts “Life Sciences Ready”

To date the Center has committed $194M to twelve capital projects

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MLSC Investments Have Contributed to the State’s Abundant Laboratory Space….

2007 2008 2009 2010 2011

16,064,000

16,780,000 17,021,000

17,800,00018,437,000

Source: Colliers Meredith & Grew, Life Science Review, 2007-2011

Since 2007, nearly 2.4

million square feet of commercial

lab space has been added

to the state’s inventory

through new construction

and renovations

Courtesy of MassBio Industry Trade Association 2012

Life Sciences Center investments have helped fund the creation of more than one million square feet of new laboratory and manufacturing space.

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…and Incubator Space to Support the Growth of New Life Sciences Companies Across the State

Cape Ann Business Incubator

Massachusetts Biomedical Initiatives

Tufts University Biotechnology Transfer

Center

UMass Boston

M2D2 at

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MLSC Neuroscience Consortium (launched June 2012)

Objective: Create a pioneering new model of collaboration designed to leverage Massachusetts’ rich neuroscience environment to:

Accelerate pre-clinical research available to the pharmaceutical industry Introduce academic researchers to targeted research Facilitate new models of industry-academic partnership

Massachusetts’ basic neuroscience, translational, and clinical research distributed across more than a dozen world-renowned institutions amounts to what may be the highest density of neuroscience research in the world.

Neuroscience Consortium Charter members:

First Solicitation for Proposals was Released September 24, 2012. Nearly 100 proposals received!!

Abbott Biogen-Idec EMD Serono Janssen Research (Johnson and

Johnson)

Merck Pfizer Sunovion (Dainippon

Sumitomo)

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International Pre-Commercialization Program

Objectives: Promote and motivate collaboration

between life sciences companies in Massachusetts and other countries

Facilitate partnerships between companies in Massachusetts and other countries to execute exciting new projects

Provide joint funding to subsidize the costs and accelerate the execution of these projects

Approach:

Partner agencies with funding and scientific review authority implement the collaboration with the MLSC

Competitive solicitation used to select the most promising project(s) proposed by teams consisting of a Massachusetts-based and non-U.S. based company

Program focuses on collaborative life sciences projects in late R&D or development

Participating companies must each articulate their role in executing the proposed project

Massachusetts companies will receive funding from the MLSC; international company will be funded by relevant Partner agency

Each of the participating companies will provide matching funds

Objective: Promote late stage industry R&D collaborations between a Massachusetts company and an international company with joint funding provided by the MLSC and an international partnering agency

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International Partnership Assistance Portal (IP-ap)

Objective: Make it easier for international companies to identify and pursue potential partnerships with Massachusetts companies.

Massachusetts is open for collaboration: 24/7, 365 days a year.

Free, password-protected, cloud-based portal -- Create your user profile at https://partnering.masslifesciences.com

Open to MA-based life sciences companies and international life sciences companies

Companies describe their business and qualities they are seeking in a partner

Searchable database - MA companies can search MA and international companies, and international companies can search MA companies

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Keeping in Touch

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