GOOD IDEAS WIN: Area biotech firm example of success
Editor's note: This is the last in a series of stories on attracting biotech firms to the state.
By Luther Turmelle
BRANFORD ? To find a story that illustrates the potential that biotechnology has for the New Haven area, you need only travel a short distance beyond the Pearl Harbor Memorial Bridge into a quiet little industrial park here.
Tucked just off Route 1, Neurogen Corp. is proof that with a little help, companies with a good idea can succeed in the New Haven area, despite a lack of adequate laboratory space and a shortage of qualified workers.
You won't find any more humble beginnings than those of Neurogen. Founded in 1987 by two Yale professors, the biotechnology company has always had its headquarters in Branford.
But the lack of lab space that still plagues the New Haven area today was even more acute back then, forcing Neurogen to rent lab space from Wesleyan University in Middletown for the first three years of its existence, said Stephen Davis, vice president of finance and chief financial officer.
But armed with the idea that altering the way cells in the human body communicate with one another could ultimately be used to treat a broad variety of health problems, Neurogen persevered. The company is now highly regarded, both in Connecticut and beyond.
The company has made the "Fast 50" list - developed by the Connecticut Technology Council and Deloitte & Touche - for the last three years. The list spotlights the 50 fastest-growing technology companies in the state, based on revenue growth.
Perhaps even more important in terms of its long-term survival, the company has a lucrative partnership to develop new drugs with pharmaceutical giant Pfizer. The two companies are working together to develop drugs to treat anxiety, depression, insomnia, Alzheimer's disease and obesity.
Neurogen's drug development strategy has been to develop "a very broad portfolio in order to diversify our risks," said Davis.
'But if you're making investments across a broad array of products, the (amount) of the investment intensifies," Davis said.
Having a big-name pharmaceutical company as a partner is critical because it helps smaller biotech companies like Neurogen bring in revenue and defray some of the costs associated with bringing a drug to market. An example of that came in June when Pfizer agreed to pay at least $27 million over three years to license software developed by Neurogen to speed the drug development process.
Bringing a single new drug to market costs an average of $500 million and takes 12 to 15 years of research, according to the Pharmaceuticals Research and Manufacturers of America, a Washington, D.C. trade group.
That kind of research activity requires adequate lab space and an adequate pool of well-educated workers, both of which are in short supply in the New Haven area.
Neurogen officials solved one of its problems earlier this month when it was able to engineer a purchase of a new, 54,000-square-foot manufacturing facility adjacent to its headquarters.
The company is launching the expansion with the help of a $5 million grant from the BioScience Facilities Fund, administered by Connecticut Innovations Inc.
The Rocky Hill organization is the state's leading investor in high-tech companies. It administers several funds to foster high-tech development.
The BioScience Facilities Fund was set aside by the state legislature in 1998 to promote the growth of laboratory space statewide.
"(The) announcement represents an outstanding example of public and private collaborations that are resulting in the growth of Connecticut's bioscience cluster," said Debra K.
Pasquale, president of Connecticut United for Research Excellence, or CURE.
Roughly one-third of the new facility will be devoted to laboratory space, which will allow the company to expand its scientific staff from 130 to 300 or so, officials said.
Finding talented workers to fill those positions is proving more difficult for Neurogen, even in an industry that has average salaries of $50,000 per year in Connecticut.
"It's just a very competitive market for employees with scientific backgrounds, said Davis. "For jobs that need a bachelor's or master's degree, we keep our search pretty local, but for the top level scientists, we're looking at people worldwide."
To keep its edge, Neurogen pays its employees' insurance premiums and offers them stock options, said Christina Marks, Neurogen's manager of human resources. It has also beefed up relocation packages and bumped up salaries by 15 percent over the last 18 months, Marks said.
While Neurogen has grown beyond the size of some of the start-up companies that are just now being spun off from research done at Yale, it retains that small company feel, Davis said.
Retaining that type of culture within Neurogen is important because it allows for a free flow of ideas which might not get noticed at a larger company because of internal bureaucracy.
"The culture here is more like you'd find at a small high-tech company in the Silicon Valley," he said.
"Even though we have over 50 Ph.D.s here, we don't have everybody running around calling each other doctor. Everyone here is on a first-name basis, even Harry (Penner, the company's chief executive officer)."
Neurogen is still small enough that its entire staff can meet in a large conference room, Davis said.
And every Tuesday, the entire company meets to discuss what's going on at Neurogen
"It helps us foster the type of community we want to have here," Davis said. |
