More venture capital urged for start-upsIs Maryland a...

LIFE SCIENCES

February 02, 1993|By Liz Bowie

More venture capital urged for start-ups

Is Maryland a hotbed of venture capital, or is the biotech industry being held back by a lack of capital?

The debate was revived by University of Baltimore economics Professor Zoltan J. Acs' recent article in Economic Development Quarterly.

Dr. Acs has stirred the pot by saying that local venture capital firms don't support Maryland's biotechnology businesses, particularly start-up companies.

He wrote that only 43 percent of the biotech firms in the state get any money here, and that it represents a small portion of their capital. "These results also suggest that Maryland has not developed the sophisticated venture capital networks that are needed to promote science-based industries like biotechnology."

The statistics he uses are several years old, and the professor says "my sense is that there has been an upturn in investment in this region."

"I read that and laughed," said Charles Newhall, a partner with New Enterprise Associates, largest of the 24 venture firms in the Baltimore-Washington area. He said NEA has invested $10 million in 17 Maryland high-tech companies that have revenues of $1 billion and employ 10,000.

The firm also has organized syndicates worth $330 million for companies in the state. Meanwhile, mid-Atlantic venture firms are responsible for funding companies in the region that have $2 billion in revenues and 20,000 employees, Mr. Newhall said.

But others say that much more money -- and much more commitment -- from local venture capital firms will be needed to develop a viable industry in the region. Most of the deals handled by local firms involve out-of-state technology companies, they add.

Walter Plosila, who heads the Montgomery County High Technology Council, said the greatest complaint from entrepreneurs is that the largest venture capital firms do not want to get involved in the earliest stages of a company's development. The firms are more apt to put money into small established companies than into companies that are trying to attract seed capital.

"They are not the originators of deals. Generally somebody finds a deal and asks them if they want to participate," he said.

Univax postpones secondary offering

Univax Biologics Inc. of Rockville postponed its secondary public offering after the stock price dropped to $7.50 last week, from $11.50 at the time it registered with the Securities and Exchange Commission on Dec. 30.

"A significant amount of uncertainty in the market for biotechnology stocks has forced down the price of Univax's stock to an unacceptable level," the company said in a statement. Univax said it has $30 million in cash and believes it is prudent to wait until the market improves.

The company hopes to sell vaccines and a vaccine hybrid, called polyclonal antibody, that would provide immediate, short-term immunity to diseases.

Money from the sale of the 2.5 million shares would pay for further development of three products that are close to marketability.

'Talk show' touts biomedical research

A Johns Hopkins University professor has turned to the talk show format for a class that attempts to interest students and the public in biomedical research.

You might not think that Hopkins students need entertaining, but Dr. Shin Lin thinks some pre-med students aren't aware of the wealth of careers in the biomedical field.

Funded by a grant from the Howard Hughes Institute, Dr. Lin's course is free and open to the public. The lectures, which began in January, are held every Monday through May 3 from 7 p.m. to 8 p.m. in Room 111, Mergenthaler Hall on the Homewood campus. Each week a different lecturer or guest will talk about a specialty. For instance, a National Institutes of Health administrator, a scientist from a pharmaceutical company and Hopkins researchers will be questioned by Dr. Lin about their work.

There's no homework or textbook, but there is a final exam for students.

"We welcome anyone," Dr. Lin said. "The bigger the crowd the better the atmosphere."

For more information, call 516-7245.

Scios Nova in last tests of kidney failure drug

Scios Nova Inc. began the final studies last month for Auriculin atrial natriuretic peptide (ANP), a drug to treat acute kidney failure.

Preliminary tests of ANP indicate that it should have therapeutic value in treating the estimated 160,000 patients affected yearly in the U.S. by acute kidney failure, the Mountain View, Calif.-based company said.

The study will be conducted at 35 centers on 500 patients. If the results are good, the company can apply to the U.S. Food and Drug Administration for marketing approval, a process that can take months or years.

Crop Genetic grows beneficial insects

Crop Genetics Inc., a biotechnology company in Hanover, has found a new way to grow lots of insects that will be used in place of pesticides and herbicides.

In its so-called "breeding farm," insects are grown on mesh screens on which a nutritional gel has been poured. The farm's temperature, humidity and airflow are kept constant with the help of a computer.

The company recently received a patent for its invention, which takes some of the tedium out of growing bugs.

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