From left, Steven Casey, Marjorie Benbow,
Randall Johnson, Steven Burke, Norris Tolson, Cheryl McMurry, John Chaffee and Gwyn Riddick.
Industry boosters say efforts to establish the sector
across North Carolina won’t dilute its impact.
The Triangle forged North Carolina’s reputation as a biotechnology power, and other regions capitalize on it. That’s not only desirable, it’s necessary, according to the North Carolina Biotechnology Center, a nonprofit that promotes the sector and lobbies on its behalf. Business North Carolina recently asked the center’s leaders to discuss the sector’s statewide thrust. Participating were Norris Tolson, president and CEO; Steven Burke, senior vice president of corporate affairs and acting president of the North Carolina Biofuels Center; Steven Casey, vice president of statewide operations; and the directors of the center’s five regional offices: John Chaffee, Eastern office, Greenville; Randall Johnson, Southeastern, Wilmington; Gwyn Riddick, Piedmont Triad, Greensboro; Marjorie Benbow, Charlotte; and Cheryl McMurry, Western, Asheville. Arthur O. Murray, BNC managing editor for special projects, moderated the panel, which was sponsored by the center and held at its headquarters in Research Triangle Park. Following is a transcript, edited for brevity and clarity.
What are the advantages of a statewide approach?
McMurry: Western North Carolina is not a place you immediately think of as a biotechnology hotbed, but it has unique characteristics that provide an opportunity to develop a pipeline for health- and wellness-related therapeutics. We have the most botanically biodiverse area in North America. The biotech center also has been supportive in establishing the Bent Creek Institute. It has formalized a way of doing research into native botanicals, has set up North America’s only gene bank of medicinal plants and serves as a repository where scientists from around the world can get source material in order to perform experiments.
Benbow: Look at what’s happening at the North Carolina Research Campus, where a new paradigm of health care is materializing, looking at health, nutrition and wellness. We’ve even got some exciting work in the area of ag biotech.
Johnson: In southeastern North Carolina, we have assets we’ve just barely begun to explore. Some are in marine biotech, but we’re also looking at biofuels, as well as pharmaceutical and nutraceutical applications of agricultural biotechnology. It’s all about connecting the dots with the rest of the state.
Riddick: The Piedmont Triad is really the second-most-developed bioscience region in the state after RTP. We have four research universities and a medical school. Each has its specialty. When you have diversity like that, you can be enveloped in things like regenerative medicine, which is very strong at Wake Forest; nanobiotechnology, which is being developed at all three of our big research universities; and medical technologies — for example, diagnostics.
Chaffee: Biotechnology in Eastern North Carolina revolves around three areas: translational science in nanobiotechnology, marine biotechnology and the East Carolina University Brody School of Medicine and the allied health sciences around it in Greenville. The other large component is pharmaceuticals.

"The new applications aren’t all going to be imagined in the Triangle."
Burke: This state has unparalleled capabilities. Look at what we grow across our state — trees, soybeans, fish, crops, swine. We’re developing new ways of making fuels. Look at our resources, institutional and otherwise.
Casey: To better understand the regional attributes, we needed to involve ourselves in the fabric of all 100 counties. How do you connect those dots between all these regions and activities that are taking place hundreds of miles apart?
Tolson: The message is that biotech is not for one region of the state. The reason North Carolina is a great haven for life sciences is the research and development that’s done at our universities, and they’re spread all over the state.
What applications does this have?
Casey: Aqualutions in the Triad is working in research in southeastern North Carolina. Grape growers in the east are working collaboratively with the research campus at Kannapolis. Natural products in the west are being developed to support fish farmers on the coast. Those connections could not have happened without the foresight of this organization to put this sort of infrastructure in place.
McMurry: We see the global market expanding for dietary supplements and functional foods, and we see the blending of those two areas. This gives us an opportunity to attract businesses, to create business from the intellectual property and to create jobs in western North Carolina.
Johnson: We have a burgeoning entrepreneurial community and investors who are becoming more interested in building new biotech businesses. David Fussell at NutraGrape is creating a business out of antioxidants and natural products from muscadine grapes. Kim Jones at Alganomics is looking at ways to use algae for biofuels and natural products. Businesses are transferring technology from UNC Wilmington to the marketplace to create jobs in Wilmington and Brunswick County and Pender County around pharmaceuticals and biofuels.
Riddick: The universities in the Triad are developing more than $200 million in sponsored research money. We have two research parks: Gateway University Research Park in Greensboro, which is a joint effort by N.C. A&T State University and UNC Greensboro, and Piedmont Triad Research Park in Winston-Salem, which we think will probably be the largest urban research park in the U.S.
Chaffee: ECU’s Brody Cancer Center and UNC Chapel Hill are collaborating to research and develop cancer treatments. The Heart Institute at East Carolina has built $180 million in facilities to research and treat heart and stroke patients. The Metabolic Institute is one of six centers identified by National Institutes of Health that are investigating the causes of obesity and diabetes and developing treatments. They’ve been exploring opportunities to collaborate with scientists at the Hamner Institute and Research Triangle Institute.
What about the recession?
Tolson: Our research universities will continue to pump out ideas, science and technology that need to be proliferated around the world. We know how to do that in North Carolina. We can help North Carolina pull out of this recession.
Casey: Companies can help themselves as well. We’ve seen cycles of recessions across other industries in the past, and what that tends to lead to is a retooling of process and procedure. Companies are laying off workers, but some functions are best served by outsourcing. You’ll see growth in merger-and-acquisition activity as companies like Glaxo start filling their pipelines by looking earlier at drugs in other companies’ pipelines.
Burke: Societies will always need drugs and food and crops and environmental remediation and new fuels and new ways to affect our survival in a changing climate. So while there might be short-term difficulties with financing and outcomes, we have reached the stage in which, recession or not, society is increasingly dependent on this technology.
Benbow: Again, look at what’s going on at the North Carolina Research Campus in Kannapolis. We will need fruits and vegetables, and there will probably be more pressure to make sure that those fruits and vegetables are locally grown. The state Department of Agriculture is looking at different soil types and other methods to promote that.
McMurry: The biotech center has been instrumental in focusing on what the market requires and how to get that research done. We also look at how we can cut down on the time it takes to benefit people in the health and wellness arena. While we are in this recession, we’re nonetheless putting those processes in place, and we’ll see increased businesses and increased jobs and an even more vibrant sector than we’ve seen to date.
Riddick: Biotechnology is not recession-proof. But look at the way the markets have performed. Through the end of 2008, the Nasdaq Biotech Index was down about 22%. The rest of the Nasdaq was down more than 42%. During times like this, people can forego their latest Blu-ray DVD player and maybe even the latest cell phone, but they can’t forego medicines for chronic diseases. Those always are needed.

"California’s out of money. Boston’s too cold, and there are no jobs."
Chaffee: There’s going to be some contraction. We’re seeing it in some of the pharmaceutical industry. And certainly there are going to be biotech companies that are going to struggle for cash, and the investors that are out there are going to be deliberate in terms of where they spend. But we just had a discovery at one of the labs in Carteret County. It is a test for a toxin in shellfish that doesn’t have to wait three days for a response from a lab. That’s the type of technology that will move forward even during a recession because there will be a built-in demand for it.
Casey: Recession drives innovation. This gives the sectors that have unique characteristics a chance to look at what else they can do with the capabilities they have. Take Charlotte, with its big banks, which are starting to lay off people. Banks deal with great deals of numbers, so there are data centers in Charlotte. What else can we do with those data centers? Well, you read about things happening at UNC Charlotte like bioinformatics, the human genome project, genomics in itself. Is there a way to convert bank data centers to respond to the burgeoning data flow coming from our human genetics? So recessions sometimes do lead to opportunities for innovation.
How do you respond to critics who say spreading biotechnology operations across the state comes at the detriment of the Triangle, where they are strongest?
Tolson: What the biotech industry, just like any other industry, needs are workers and money. All the workers don’t live in the Triangle. A lot of good science minds come to our universities from rural North Carolina. Many would like to go back there to work, so we encourage people who look at our state or want to grow a business in our state to look at all the counties. Will that hurt the Triangle? I don’t think so.
Burke: It is the nature of technologies to start someplace as a result of human imagination and then to go farther afield. Constraining biotechnology to the Research Triangle Park would have been like constraining the Industrial Revolution to the Midlands of England in the 18th century.
Chaffee: Technology seeks out new applications, and the new applications aren’t all going to be imagined in the Triangle. You have some very brilliant minds that choose to live elsewhere. A large part of what we’re doing in the regional offices is identifying who is out there, what they’re doing, where they want to go and what they need to get there.
Riddick: The state’s research parks have created a network to do exactly what we’ve been doing — sharing information and making sure that regions have specific assets and strengths. If there are inquiries coming into the state, they will be matched to those assets.
Chaffee: Take the marine laboratories in Carteret County. These are Triangle-university-based, but they’re so far from their main campus that they might as well just be on a Caribbean island. Part of our responsibility is identifying that we’ve got a marine-science cluster in Carteret County. We also can help them actually make connections not only to their main campuses in the Triangle but also to campuses throughout the state. Developing those capabilities and building those bridges between multiple institutions strengthens the state.
Benbow: Whoever wants to find a place to put their biotech home in North Carolina can. And if they do, as an economic developer in my region, I’m able to say, “Well, just because you sit here in the Charlotte region doesn’t mean you’re not going to be able to tap into the assets from the five other regions.”
Casey: RTP is the bait, and the state of North Carolina is the hook. They look at us because of RTP, but it’s the attributes that we have across the state that allow these companies to make decisions based on their needs. Is it land needs? Is it labor cost? It’s not going to be too long before you’re going to see companies start moving a little farther north from what we see now as RTP, and the lines between RTP and the northern areas of the Research Triangle region will become more blurred.
Johnson: The term “spreading biotech around the state” might be the wrong way to think about it. We’re really building it across the state. We’re making the whole pile larger, not moving assets from one area to the other.
Do people expect too much too soon from the state’s biotechnology industry?
Burke: Ours is an age in which we expect quick outcomes from new technology. For biotechnology, we’re in necessarily a long-term endeavor. Some of the changes will come more deliberately, but those changes will affect our life well into the future.
Tolson: But biotech also offers incremental change. When we talk about nutrition research at the North Carolina Research Campus, what we’ll learn is that we can incrementally improve our quality of life and our health by making small changes in the way we live and eat, coupled with the way we grow those crops. So it’s not just monumental issues that will cause biotech to become more important. It’s the incremental change.
What’s one thing the state could do to help promote the industry to compete against places such as Boston?
Tolson: Keep doing what we’re doing and do it better. Places around the world covet our model. We need to make sure that we keep reminding ourselves that we are doing it pretty well.
Riddick: That means continue to develop the right policy at all levels of government and industry and to really support innovation in research as well as nurturing entrepreneurs.
McMurry: It seems to me that there are opportunities for creative, nimble funding mechanisms that can be deployed to help biotech and biotech-related companies get their products into the marketplace.
Chaffee: We need to redevelop the technology-transfer model in North Carolina. The state does extremely well on the research component; but as we move it into development, we fall behind. If we can reinvent our tech-transfer model — not necessarily pouring more money into it but just improving it and changing the way we incentivize tech transfer at our universities — we’d have immeasurable results.
Benbow: I get a huge number of résumés from people who have left North Carolina but want to come home. Can we do something to bring that talent to North Carolina? I feel strongly that if you’re pinched right now — losing your job in one of these more expensive biotech centers — the cost of living in North Carolina is great. Now is the time to go recruit companies.
Johnson: We need to strengthen our culture of entrepreneurship in this state. We’ve done a great job of recruiting and building industry, but most of our successes in biotech are going to come from entrepreneurial ventures that start very small.
Casey: I was at a meeting and a product manager for a multinational, multibillion-dollar organization said, “North Carolina, with your assets that you have here, your lower cost of living, your available labor force, you can be the No. 1 biotech center in the nation.” And somebody stood up and said, “Come on, can we really be No. 1?” And he said, “I believe it with all my heart.” California’s out of money. Boston’s too cold, and there are no jobs. We have an available, trained labor force here. You can come down here and build a factory at a fraction of the cost that it would cost you in San Jose, and you can hire labor without cannibalizing your neighbors.