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After his meeting with venture capitalist Brook Byers, a $300,000 check in hand, Howard Birndorf thought excitedly about a new company he and his colleague, Ivor Royston, were founding. Called Hybritech, the firm would use the new technology of monoclonal antibodies to revolutionize the tedious process of diagnosing diseases. The antibodies — protein sequences keyed to hone in on precise organic compounds — would help doctors treat patients sooner. They also thought it could establish the nascent biotechnology industry in San Diego. But while driving back from the meeting, more mundane matters intruded: Birndorf ran out of gas.
Howard Birndorf, now chairman and CEO of Nanogen, still relies on sources from early Hybritech days.
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That was 20 years ago, when Birndorf and Royston were two relatively unknown researchers at UCSD. Today, Birndorf and Royston are known as two of the fathers of San Diego’s biotechnology industry. They, their onetime associates at Hybritech, and the companies they've helped found and run, dominate the local biotech scene.
Besides Royston and Birndorf, the Hybritech alumni list includes Howard (Ted) Greene, David Hale, Tina Berger Nova, David Kabakoff, Cam Garner, Dennis J. Carlo and many more respected leaders. The companies founded by these alumni or connected with them are just as illustrious: Ligand, IDEC, Dura, Gensia, Neurocrine Biosciences, Immune Response Corp., Viagene, Gen-Probe, Nanogen and others. (An apology in advance to those whose names aren’t mentioned in this article: there are too many of you.)
Now chairman and CEO of Nanogen Inc., Birndorf still relies on the collection of bio-brainpower Hybritech assembled, a network in some ways rivaling UCSD Connect or Biocom San Diego. "I can call Dennis Carlo, David Kabakoff or Cam Garner and ask, 'What do you know about this?'" Birndorf says.
Hybritech "established that there was a business there, that taking embryonic technology and pushing it forward was a viable commercial strategy with potential for rewards, and that’s really what biotech is all about," says Robert Bohrer, a professor of law at California Western School of Law who has extensively studied and written about biotechnology issues.
In the early 1980s, Hybritech expanded at a white-hot rate, giving its employees a feeling much like those in today’s Internet companies.
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They weren’t conquering the world; they were creating a new one. They'd help cure diseases, explore fascinating areas of science, and, perhaps, get rich in the process: the ultimate win-win-win.
"Perhaps our greatest contribution was to show the way," says Brook Byers, a partner in the legendary venture capital firm Kleiner, Perkins, Caufield
& Byers, Hybritech's fund provider. Byers says the Hybritech team became "role models of responsible risk taking, good technology transfer business practices and good corporate partnering structures."
"There were very few technology companies in San Diego ... mostly computer and computer peripheral companies," Byers says. "After the Hybritech start-up, I went on to help another dozen companies get started and grow in San Diego. The San Diego community has a more cohesive characteristic compared to Silicon Valley, Austin, Cambridge, Seattle, etc. There is something special about how UCSD, Scripps, Salk, etc. work together with the business community."
The Beginning
Greene, a medical industry veteran who was then working for what is now Baxter HealthCare, remembers hearing about the potential of monoclonals as diagnostic tools in 1976. In July 1978, he decided to join a company to exploit this technology. It wasn’t Hybritech, but a rival start-up forming in Orange County.
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Trying to scope out the field, Greene decided to track down Byers at his Bay Area venture capital firm. Byers was known for religiously studying matters technological, and Greene wanted to pick his brain. What he didn’t know was that Byers was already looking into funding a company in the exact same field. When he found out, Greene says, the news caused him to utter an expletive into his cellular telephone. He did not want to let a potential rival know of his plans."
However, Greene met Byers anyway, and the canny investor sensed what was up.
"He finally dragged it out of me," Greene says. Byers introduced Greene to firm partner Tom Perkins on a boat at Balboa Island in Orange County "and the two of us just bonded. He is a very persuasive guy, one of the best." By February, 1979, Hybritech began to take shape as scientists were hired and such necessities as animal cases added. A new cash infusion of about $1.5 million came in that summer.
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Ted Greene was one of the execs behind the founding of Hybritech.
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"It seemed like an infinite amount of money," Greene says. As the company grew, its monoclonal antibody technology appeared to be potentially useful for therapeutic treatments, not just diagnostics. But exploring that new use might spread the company too thin, away from its already profitable venture in diagnostics. So IDEC Pharmaceuticals was spun off in 1985 to develop therapeutics.
Success In Failure
But Hybritech's glory days were soon to end. For about eight years, it had been the shining example of a successful biotech company. Hybritech's success drew the attention of Eli Lilly & Co., a large pharmaceutical company based in Indianapolis. In 1985, Lilly decided to buy Hybritech. The deal closed early in 1986 for about $500 million. A very conservative, button-down company, Lilly was, and is, known as well-respected, honorable but plodding. Lilly's risk-averse executives didn’t mesh with Hybritech's wacky try-anything culture.
"It was like 'Animal House' meets 'The Waltons,'" says Tina Berger Nova, who also recalls being told by a Lilly scientist that she was young enough to be his daughter.
"Unfortunately, Lilly was not able to retain the management team that built and made Hybritech such a success from 1978 to the merger in 1986," Byers says. "Then, instead of promoting from within (like Roche allowed at Genentech with Art Levinson), they rotated executives out to run Hybritech. Some were good, some were not, but the lack of consistency and relevance hurt, for sure."
The predictable exodus of talent followed. Flush with cash from the Lilly buyout, many of the Hybritech family had the wherewithal and desire to repeat the company-building experience.
In the same year Hybritech was sold, Birndorf helped found Gensia Pharmaceuticals, now Gensia Inc. The amazingly prolific Birndorf went on in rapid success to help found Gen-Probe, IDEC and Progenix, now called Ligand. From 1991 to 1993, Birndorf was president of Birndorf Technology Development, an investment and consulting company. And in 1992, Birndorf became a founding director of Neurocrine.
Royston also helped found companies, including IDEC, GeneSys Therapeutics, Sequana Therapeutics and Corixa, and a local venture capital company, Forward Ventures. But much of his passion is focused on the Sidney Kimmel Cancer Center. Royston founded the center seven years ago to help speed up the advance of cancer treatments from the laboratory to the clinic. Although the goal was very similar to biotech's mission, Royston says an academic-type nonprofit institution was needed to provide that conduit. The close relationship can be seen in the Center's cooperation with IDEC, developer of a drug to treat a form of non-Hodgkins' B-cell lymphoma. IDEC is the second local biotech firm to get approval for a therapeutic drug. Agouron Pharmaceuticals was the first, in 1997.
"Ivor, Howard, and I started (IDEC) in 1988 in the continued belief that therapeutic antibodies would work on intractable diseases that plague mankind," Byers says. "We were considered lunatics by Lilly. Obviously, time has proven us right. IDEC has become a profitable, independent, public company. That was important to us and to the world class management team we attracted to IDEC in the late 1980s (who are still with IDEC)."
Greene and Hybritech alumni Tim Wollaeger scored a home run with Pyxis, a medical products company that Wollaeger founded and Greene chaired before its public offering. He was replaced by Ron Taylor, still another Hybritech executive. In February 1996, Pyxis was purchased by Cardinal Health for more than $900 million.
The post-Hybritech Wollaeger also became known as an investor, a general partner of the local venture capital fund Kingsbury Associates. Kingsbury's investments include Biosite Diagnostics and Digirad. By contrast, post-Lilly Hybritech languished. Lilly grew increasingly frustrated with the lack of return on Hybritech and its other San Diego biotech holdings, and sold them off in the mid-1990s. In 1995, Hybritech was sold to Beckman Instruments for a rumored fraction of its purchase price, which Lilly did not disclose publicly.
"The consensus is that (Lilly's management) really did lead to the decline of Hybritech," Bohrer says. "It lost its entrepreneurial and risk-taking, innovative people and way of business.
"I think Lilly learned a lot," Bohrer says. "They learned that what you don’t do with a biotech acquisition is impose on it the same way of doing business as a large pharmaceutical company."
The Record Today
The Hybritech bunch learned a few hard lessons on their own. One is the peril of pushing the envelope of medical research, because sometimes your assumptions aren’t correct. Stock in Gensia, for example, crashed by 50 percent in October, 1994, after its flagship cardiovascular drug, Protara, failed clinical trials. Likewise, Amylin stock fell by nearly half in August, 1997, when it reported unexciting results from clinical trials of its flagship diabetes drug, Pramlintide.
Adversity bred resilience at Gensia. Under David Hale's direction, Gensia refocused its attention to the injectable and specialty drug market, and relocated its headquarters to Irvine, where it owns a drug manufacturing plant. The company today is known as Gensia Sicor, and also provides contract manufacturing. Hale signed on to lead Women First HealthCare, a Del Mar start-up developing products for women in their midlife years.
And although the odds look long, Amylin is still investigating uses for Pramlintide, hoping to target its clinical testing amid the confusing welter of diabetes-related conditions to find the best target population.
Stock in Nanogen, developer of a gene-analyzing chip, also is lagging amid general investor coolness toward biotech, Birndorf admits. While not thrilled with the situation, Birndorf says it’s endurable. Later this year, Nanogen will release its first product. The company raised plenty of money in its IPO last year and as of the third quarter of 1998 reported more than $68 million in cash on hand. That's enough to last the company for several years, Birndorf says, and afford the "luxury" of being patient while looking for corporate partnerships or strategic alliances.
Biotechnology stocks tend to rise and fall in cycles of about two and one-half years, Birndorf says, although the performance of individual stocks is obviously affected by how well the company is doing. Still, he says, investor psychology eventually will change and look at the sector more favorably.
Ann Randolph, managing director of the trade group Biocom San Diego, says the Hybritech experience is a source of strength for the company’s "progeny" as they lead their own companies through a difficult period when investors tend to ignore biotech for more trendy sectors.
"They are knowledgeable and have the experience of how it works. They went through the R and D phase to commercialization," Randolph says. While some may have been new to the industry when they began, she says, "they're now seasoned veterans."
"Biotech is so fundamental to the quality of life and reducing suffering that it will be with us forever," Byers says. "It is like fundamental physics or chemistry; it has become and will continue to be an essential part of our understanding of medicine and health and life. So, even though there will be financing cycles, hundreds of well run biotech companies will succeed." And thanks to the actions of some local test tube cowboys 20 years ago, San Diego should have its share.
Where are the jobs in San Diego’s bioscience community? Everywhere. About 250 bioscience companies are located in San Diego, and more can be expected in the future. Those already here employ nearly 25,000 of your friends, neighbors and family. As the bioscience industry continues to grow, new positions become available, and the need to fill them is growing.
The majority of San Diego’s bioscience companies — the field covers biotechnology, biomedical, medical device and pharmaceutical companies — offer a variety of career opportunities, from entry level to Ph.D. The positions vary in discipline as much as they do in scope.
So just what is bioscience? It is a term used to classify any and all companies whose primary business may include one or more (take a breath, please) of the following: agricultural technology, bioinformatics, biomedical devices, biomedical products, biotechnology, bioengineering, cell/antibodies/reagents, chemicals, food/beverage, clinical research, contract services, dental technology, diagnostics, drug delivery systems, health care computers, marine sciences, medical equipment/supplies, ophthalmic, orthopedic, pharmaceutical, therapeutics and veterinary sciences.
The history of San Diego’s bioscience community shows that the majority of companies started in the mid- to late '80s, usually beginning as research facilities. With this growth came an immediate need to add manufacturing facilities and staff. All too often when hearing of bioscience positions, people tend to think of jobs that require advanced science degrees — and many do. But many are available to those without a science education. A huge number of career opportunities can be missed simply because one does not know where to look.
For example, Gen-Probe Inc., internationally recognized as a leader in the development, manufacture and commercialization of genetic probe tests for diagnosing human diseases, employs about 570 people, of which 160 are in manufacturing/operations. The company is expanding into blood screening markets and is establishing and staffing a new facility in the Rancho Bernardo area which is expected to employ more than 50 additional manufacturing personnel. In addition, Beckman Coulter Inc., another internationally recognized leader, manufactures laboratory automation and human medical diagnostic products and employs roughly 490 people in the San Diego area. About 250 of Beckman's employees work in manufacturing/operations in positions that do not require advanced science degrees. Also, Dura Pharmaceuticals Inc., a San Diego-based developer and marketer of prescription pharmaceutical products for the treatment of respiratory conditions, employs around 350 employees in San Diego. About 50 of those now work in manufacturing/operations. If the FDA approves Dura's main product, the Spiros dry powder inhaler, Dura will hire many more manufacturing personnel.
Many new positions are popping up everyday in San Diego, requiring all different levels and skills. Qualified employees are in high demand throughout the San Diego bioscience community. Since there is such a high demand for good people, these openings are filled very quickly.
So just how does one get a job in San Diego’s bioscience community? Since the trick is finding the right opportunity at the right time, a candidate often applies to many companies at the same time and also takes advantage of any contacts he or she may have within the community. It also is wise for someone involved in the community or someone just getting into it to partner with an industry-specific search firm.
In addition to Dura Pharmaceuticals, Beckman Coulter and Gen-Probe, many bioscience research and development companies in San Diego utilize the services of scientific personnel agencies. For example, Immune Response Corp. conducts research in the areas of AIDS and auto-immune diseases and uses scientific agencies for a variety of reasons. Lisa Gonzales, the human resources representative for Immune Response, calls on her search firm when a traditional advertisement isn’t doing the job. She cites the firm's abilities to quickly provide prescreened and qualified scientific personnel.
Another reason the companies turn to search firms is to try out a person in a particular position before hiring permanently. The procedure also gives the employee the opportunity to decide if the job meets his or her goals.
Placement firms often have the inside track as to what jobs are open and when they are available, and can help candidates with career-development planning. Among the services to look for are help in résumé-writing, interviewing and matching job skills with what employers are seeking. Once they have taken on a job-seeker, some agencies provide these services at no charge.
San Diego does not lack for bioscience research opportunities. There will always be the need to develop new products and improve those that exist. As more local firms receive FDA approval for their products, the need for personnel will grow. All levels of a company will expand, from manufacturing to clinical research, regulatory affairs, quality control, quality assurance, data management, histology, product development, pharmacology, virology, chemistry, biochemistry, molecular biology, microbiology and many more. Manufacturing jobs also will increase including: manufacturing associate, formulations technician, maintenance technician, calibration technician, clean room technician, assembler, packaging/filling technician, quality control inspector, quality assurance inspector and shipping receiving clerk.
As the San Diego bioscience community evolves, manufacturing career opportunities will become more prevalent. Entry-level careers also will be available to those who never thought they could work in the bioscience industry.
In addition, those with manufacturing skills should register with bioscience personnel placement firms who, through their relationships and expertise, know what opportunities are open and when. To find people to fill the growing number of opportunities, many successful bioscience companies also will need to partner themselves with similar bioscience placement firms. Therefore, it is crucial that the San Diego business community continue to support the growth in the manufacturing sector of the bioscience industry.
Jeff Prekker is branch manager of Yoh Scientific San Diego, a bioscience placement firm. He has spent the last six years finding contract and permanent jobs in the industry for clients.
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