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Archive for Monday, July 30, 1990

RESEARCH AT KU CENTER FACTOR IN FUTURE GROWTH FOR NEW STATE INDUSTRY

July 30, 1990

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Last week's announcement by Merck and Co. and Du Pont that they're joining forces to create an independent, research-driven, worldwide pharmaceutical firm will have little effect on Merck's research at its INTERx facilities in Lawrence, says a company spokesman.

However, the announcement underscores how important pharmaceutical and biotechnological research at Kansas University are to Kansas economic development, according to key players in Kansas' attempt to build its pharmaceutical industry.

"Overnight, we're not going to have the world's pharmaceutical industry here, but I see a continuous increase in activity," said Eli Michaelis, director of the Higuchi Biosciences Center at KU.

The new company formed by Merck and Du Pont will be called the Du Pont o Merck Pharmaceuticals Co. It will have a research staff of about 1,500, including more than 400 doctoral-level scientists, a first-year research and development budget of $230 million, a professional sales staff of 600 people and first-year sales of an estimated $700 million.

ARNOLD Repta, president, of INTERx Research Corp., 2201 W. 21st, said he foresees no impact on Merck's local facility by the joint venture.

"I don't see it having any influence at least in the short term," Repta said.

INTERx is a wholly owned subsidiary of Merck and Co. and provides the company with research drug delivery systems. The company leases property from the KU Endowment Association on KU's West Campus, but is not directly tied to KU, Repta said.

INTERx began in 1968 as the first research facility of the Alva Corp. of Palo Alto, Calif. In the early 1970s, the late Takeru Higuchi, a renown KU pharmaceutical researcher and entrepreneur, and his colleagues purchased the facility from Alva and formed INTERx. INTERx was bought by Merck and Co. in fall of 1980.

Repta said INTERx has grown carefully to 42 employees and he expected to see continued controlled growth.

MERCK and Du Pont's new research and development venture underscores the importance of companies such as Oread Laboratories, 1501 Wakarusa, which is the industrial partner of the Higuchi Biosciences Center at KU.

Bill Duncan, president of Oread, said the state is committed to being involved in the developing technology transfer and "from our perspective things are starting to pick up some momentum."

"We're just now starting to see the fruits of our labor from the past," Duncan said. "In the fall, we'll be introducing what we call research products into the marketplace."

The product is a kit to be used by pharmaceutical companies' researchers for in-house work, Duncan said.

Oread Labs holds six patents on the research kits, which are the first products being developed based on the patented technology.

OREAD Labs contracts with the pharmaceutical industry both in the United States and Japan for research and development of products that serve the industry, he said.

The company now employs 43 full-time people and a dozen part-time people, many of whom are KU students, he said. He expects that number to slowly grow up to about 100 people.

Oread Labs began in 1983 on KU's West Campus as a corporation set up by Higuchi, who leased space in McCollum Laboratories through 1987. In January 1988, the company moved into an 18,000-square-foot facility in the Oread West Research Park, which was expanded by another 22,000 square feet in December. Both buildings represent an outlay of about $4 million, Duncan said.

MICHAELIS said a recently announced $1 million state grant from the Kansas Technology Enterprise Corp. will be used by the center for fundamental and applied research.

It also will help strengthen research in the area of drug delivery and help set up two new HBC centers.

Currently there are two centers in the HBC: the Center for Bioanalytical Research and the Center for Drug Delivery Research. One of the new ones will deal with drug design metabolism and toxicology.

The other new one will provide research in molecular engineering and immunology, Michaelis said.

He said HBC currently has agreements with several pharmaceutical companies, including Smimadzu, a large Japan-based scientific instrumentation manufacturer, which has a research laboratory located with HBC on KU's west campus.

HBC'S existence has spun off a company called Cypress Systems, which designs software and hardware computer packages for specialized analytical instrumentation.

He said the research and development companies bring in hundreds of thousands of dollars in investments from the pharmaceutical industry to Lawrence. For example, Glaxo, a large pharmaceutical firm, is about to initiate a $250,000 contract with the drug delivery research center. Seven representatives of Japan Tobacco's pharmaceutical division visited HBC two weeks ago. Another company, Taisho, is negotiating a small contract with the drug delivery research center.

"Considering that the center for drug delivery research has been in existence for only a year, I see that is remarkable increase of activity," he said. "I think the Oread Labs will be expanding into new areas and getting involved in more activities."

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