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updated 2:54 PM CDT, Jul 28, 2018

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LSDF may metamorphose into life science, cancer research administrator

Recrimination and agitation over the Republican-led legislative defunding of the Life Science Discovery Fund Authority (LSDF) has given way to cautious enthusiasm about the possibility its staff and board may be tapped to administer and oversee funding activity for the state's new Cancer Research and Endowment Fund (CREA).

It's not yet certain that LSDF, created a decade ago out of the state's share of Tobacco Settlement millions to promote growth of the life science industry in this state, will take over administration of what would be a Center of Excellence for Life Science and Cancer Research. But bringing that about could amount to creating some vision out of what has been legislative confusion.

The Legislature's 2015 final budget compromise funded the cancer-research entity in a head-scratching manner while killing future funding for LSDF. But the lawmakers did not put the organization itself out of business because LSDF must function well into the next biennium to oversee fulfillment of the 46 grants already awarded from the fund. It just can't make any more life-science grants.

The quixotic aspect of the Legislature's creation of CREA was that the lawmakers gave specific detail to its board makeup and duties and required that it contract with "a program administrator" to oversee grant solicitation and distribution and fund management.
 
But lawmakers didn't designate who would manage the $10 million annual state-fund grant that would have to be matched from the private sector before it could be spent, so there has been speculation since then that LSDF would be a logical entity to oversee CREA.
 
Rep. Jeff Morris 

The proposal to turn cancer-fund administration over to LSDF has been up in the air since it was approved by the state House and passed out of committee in the Senate, but stalled in the Senate Ways & Means committee when the regular session ended.

Democratic Rep. Jeff Morris, a member of the LSDF board and sponsor of the proposal, said he hopes the legislation paving the way for a new role for LSDF will be part of final budget negotiations. He explained that Sen. Andy Hill, chair of the Ways & Means Committee and the key Republican in the negotiations, "asked if we would object to a 6 percent administrative-cost cap and I indicated we would not."

John DesRosier 
eanwhile, as a future role for LSDF remains unclear, its board of trustees, staff members and a number of recipients of its grants will gather March 25 to celebrate the contributions of John DesRosier, who served first as director of programs when LSDF was established in 2005, and through most of the Authority's existence as executive director. DesRosier, who has retired, had spent almost a quarter century in research and technology commercialization before joining LSDF as it was forming.

Among those who will be on hand to thank Des Rosier is Lee Huntsman, the first executive director, who was appointed by then-Gov. Christine Gregoire after LSDF was established in 2005 by Gregoire and the Legislature.

I asked Gregoire for a comment on the decade of LSDF's existence and on DesRosier's role and she said: "LSDF has accomplished more than I could have hoped. I believe it has helped save lives and I believe it will continue doing so and there is no greater accomplishment. We were fortunate to have John DesRosier as the leader to make it happen."

Commenting on DesRosier's role guiding LSDF, Morris said "John was one of the best strategic hires I've seen by our state in my years of public service. He made our grant-selection process world class and many other states have looked to our process to improve their own performance"

Part of what the cancer-fund legislation envisions is a board that better reflects an understanding of cancer, but by coincidence that comes somewhat with the current board, whose chair is Carol Dahl, executive director of the Portland-based Lemelson Fund. 

Dahl's research while a faculty member at the University of Pittsburgh was cancer focused and she also spent nearly six years at the National Cancer Institute and built the Office of Technology and Industrial Relations and multiple programs there during that period. 

Asked about her view of DesRosier's role, she said he"has truly been an amazing advocate for the life sciences in Washington and an outstanding steward of the state's investment in LSDF."

"The substantial impact of the LSDF funding resulting in over $60 million in health-care saving, more than a half billion in follow-on funding, and hundreds of lives saved ,is a credit to John's leadership and the dedication of the entire staff that has supported  LSDF since its inception," Dahl said.

One of the largest grants from LSDF was $5 million to Omeros Corp., which related to a $20 million partnership with Vulcan to advance the company's leading-edge G protein-coupled receptor program. GPCRs, which mediate key physiological processes in the body, are one of the most valuable families of drug targets.

Omeros chairman and CEO, Dr. Gregory Demopulos, described LSDF as "an important catalyst for innovation in Washington State's life sciences. And through investments like the one for Omeros has left a legacy of creating jobs and improving health and will have a sustained impact on the people of the state."

DesRosier described LSDF as having been a "critical resource" in helping early stage companies survive so they could gain traction for new sources of funding, including attracting traditional investors.
 
One such beneficiary of LSDF grants is M3 Biotechnology, a young Seattle biotech company focused on commercializing a drug that would reverse neurodegenerative diseases like Alzheimer's and Parkinson's by re-growing brain cells.
 
"LSDF funding allowed us to cross the start-up 'valley of death' until we could gain funding traction," said Leen Kawas, the 30-year-old CEO and president of M3 who recently announced completion of an over-subscribed A-Round that brought in nearly $10 million.

Because I was assisting Kawas with marketing and introductions while she was awaiting key grants from LSDF, I bit my lip for being unable to write about LSDF or its challenges with the legislature until her grants had been approved and there was no longer a conflict of interest.

I asked DesRosier if there was anything he wished LSDF had accomplished before the lawmakers struck it from future funding.

"I wish we had been able to create a more diversified revenue stream and not be dependent solely on state funding," he said.

Dr. Bruce Montgomery, perhaps the Northwest's most prominent biotech entrepreneur as well as the longest-term member of the LSDF board, may have best summed up the feeling of lost opportunity that the end of LSDF's life-science mission embodied for many.

"The best quote I can offer is the line from Joni Mitchell's 'Big Yellow Taxi': 'don't it always seem to go that you don't know what you got 'til it's gone,'" Montgomery replied to my request for a quote.
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