By Ray Stern
By New Times
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Phoenix City Councilman Greg Stanton a strong proponent of the project says he's confident that IGC will do everything possible to raise the funds needed to do the promised project. But he concedes he has no idea how successful IGC has been to date in securing the needed drug money.
ABBI officials at Arizona State University say the institutes are assuming that IGC will obtain the full funding needed to do its planned research. If IGC funding is derailed, momentum to start ABBI also will slow.
"If IGC isn't fully functional, my guess is Jeffrey Trent is not going to come out here," says Jonathon Fink, vice provost of research at Arizona State University. "If he doesn't come, that reduces some of the urgency to get ABBI launched."
Officials in the governor's office take a different view.
Tim Lawless, Hull's executive assistant for business, says Trent and his team of researchers will be employees of ABBI and are expected come to Arizona no matter how much funding IGC is able to raise from drug companies.
"Having the IGC is important, but it's not the overriding thing," Lawless says. "The scientists are coming here to ABBI."
As ambiguity swirls around IGC's financial underpinnings and the impact on ABBI, fund-raising on the local level continues. IGC and ABBI promoters have secured major financial commitments from the state ($30 million), Phoenix ($21.5 million), Maricopa County ($5 million), private foundations ($15 million), universities ($8 million), local hospitals ($1.5 million) and private contributors that include several banks ($3.5 million) for a total of $84.5 million. ABBI is also hoping to receive funds from the federal government ($10 million).
But even more locally raised money is needed.
At a hastily scheduled press conference last month to announce, to no one's surprise, that IGC had selected Arizona as its prime location, it was made clear that another $20 million needed to be raised for ABBI.
For all practical purposes, IGC and ABBI are part of the same chromosome.
ABBI will be run by Trent and his handpicked team of IGC scientists. Its goal is to generate marketable products from the information generated by the consortium.
"IGC is not going to come here unless the people who are going to be involved with running IGC also have a place for them to do their work," says ABBI fund-raiser Steve Roman. "Therefore, we are trying to create that infrastructure, which is ABBI."
ABBI is expected in time to become a profit center but only after sustaining substantial losses in the first few years. A PricewaterhouseCoopers study paid for by the state estimates that ABBI will lose $98 million in its first five years of operations.
IGC wants to make sure ABBI has enough public and private funds to cover the projected losses. So far, about $78 million in public and private funds has been committed towards ABBI. That's why IGC says it will come to Arizona, but only if an additional $20 million is raised for ABBI.
Negotiations between the state and Trent's team are continuing over the final structure of ABBI, which is expected to be a nonprofit corporation. While ABBI will receive significant public funding, its board of directors is expected to be controlled by private interests. ABBI is also expected to set up a for-profit subsidiary to market any products that might be developed.
Even as ABBI is preparing to offer Trent the top scientific job at the institutes, there is no definitive agreement on what percentage of ABBI's potential profits will be returned to the state.
This is a crucial issue for the universities, which are diverting $8.2 million in Proposition 301 money that was allocated for on-campus research projects into ABBI, an organization that will fall outside university control.
"There needs to be a way for profits to get back to taxpayers from inventions that come from publicly funded research," ASU's Fink says.
IGC's work conducted so far at Scottsdale Healthcare has been supported primarily by the manufacturers of the microarray chips used to analyze the tumors. Motorola is one of three companies that have contributed to the effort.
In what may be an indicator of private sector interest in the IGC effort, Motorola says it is not prepared to contribute cash to the project even though IGC could potentially become a major consumer of the company's microarray chips.
"At this time, we are not considering a financial commitment," Schmelkin says.
The underwhelming financial response to IGC outside of Arizona appears to be tied to the fact that the consortium's fundamental mission to conduct microarray analysis of how genes relate to cancer is already being conducted throughout the United States.
The National Cancer Institute has invested several hundred million dollars in microarray gene expression research at laboratories throughout the country. As a result, there has been an explosion in the amount of microarray data being created.
"Proficiency in generating data is fast overcoming the capacity for storing and analyzing it," according to the National Center for Biotechnology Information. "As more laboratories acquire this technology, the problem will only get worse."