Building a Community
LabCentral formally opened in April, five months after welcoming its first tenants. Co-founders Johannes Fruehauf, M.D., Ph.D., and Peter Parker joined Cambridge Innovation Center (CIC) founder and CEO Tim Rowe to create the incubator, using a $5 million capital grant from the quasi-public Massachusetts Life Sciences Center (MLSC).
Dr. Fruehauf, LabCentral’s president and executive director, told GEN the incubator generates revenue from startups, which pay rent starting at $4,000 a month for a bench, as well as $15 million from industry partners that include J&J, Novartis, and Pfizer, for access to incubator members.
LabCentral selects startups deemed to have the highest potential for success, starting with an online application. Startups that look promising are invited to visit or speak by phone. The final step is a formal presentation before a selection committee that includes Dr. Fruehauf, Parker, and Robert Urban, head of the J&J Innovation Center based at the incubator. Of over 100 applicants, about 25 have been approved.
“We select our companies based on their willingness to be part of a community, not just hunker down and do their own science, but also to communicate, to share, to embrace our idea of transparency, to help out other people next to them. That’s what’s going to make a difference for them in the end, if they communicate and interact with other scientists, then they’re more likely to come up with good new ideas,” Dr. Fruehauf said.
About two-thirds of LabCentral’s startups are drug developers; the rest develop research tools or medical devices. About half are spun out of or affiliated with nearby MIT, from which the incubator rents its space. The region’s other research institutes and universities, including Harvard and Tufts, also generate startups.
LabCentral expects to fill its entire 28,000 square feet this summer, then double its space in an adjacent building under construction—a buildout for which MLSC has awarded a second $5 million grant.
Bayer HealthCare houses startups at “CoLaborator™” sites in Berlin and San Francisco’s Mission Bay. Merck & Co. contributed $90 million toward the California Institute for Biomedical Research (Calibr), a not-for-profit formed to accelerate translation of basic research into new treatments. Illumina is creating an accelerator program for startups developing next-generation sequencing applications; the application deadline was extended to July 30. In November, Celgene plans to start housing in its San Francisco space startups funded by Versant Ventures under a collaboration with Versant-backed incubator Blueline Bioscience in Toronto.
Versant is among venture capital firms doubling as incubators. Last year, Avalon Ventures and GlaxoSmithKline (GSK) launched a $495 million collaboration to form and fund up to 10 early-stage life science businesses in San Diego, each with $10 million in Series A financing and R&D support from the VC firm and pharma giant.
Avalon and GSK jointly approve the new companies, one of which has been created. The partners will use San Diego incubator space to house the startups, whose staffs will actually work for an entity named CoI, short for “community of innovation,” moving among the startups.
“It’s more capital efficient,” Jay Lichter, Ph.D., managing partner with Avalon Ventures, told GEN. “You can get senior people who are somewhat expensive to work on an early-stage company, but only spend maybe 10 or 20% of their time on it.”
A postdoc or senior researcher from the founder’s lab is brought in to drive science, under Avalon supervision “to make sure they’re doing product development as opposed to just research,” Dr. Lichter said.
This story has been corrected from an earlier version, which mistakenly said Avalon and GSK created five new companies, not one. GEN regrets the error.