The Show Must Go On: Invest Northwest Forges Ahead Despite Grim Biotech Climate

Xconomy Seattle — 

There are easier things to do these days than trying to organize a biotech investing conference in Seattle. The local cluster has taken its share of body blows, the weather is usually pretty gray in late winter, and investors aren’t in the mood to bet on anything more risky than U.S. Treasury bills.

It’s all made Chris Rivera’s job as the new president of the Washington Biotechnology & Biomedical Association more difficult, forcing him and his staff to be more creative as they try to keep attendance from falling off a cliff at this year’s Invest Northwest conference March 17-18.

It has always been a challenge for life sciences companies to attract the industry’s financiers to this far corner of the country, away from the big money centers of New York, Boston, and San Francisco. So Rivera says he’s been flipping fast through his Rolodex among venture capitalists in those places, as well as business development officers at big pharmaceutical and biotech companies, to urge them to come spend a couple days in Seattle. This has clearly been hard sledding. Attendance at the industry’s most important investing event, the JP Morgan Healthcare Conference in San Francisco, was 6,600 this year, down about 12 percent from 7,500 in the previous year. Last week’s BIO CEO and Investor conference, held at the posh Waldorf-Astoria in midtown Manhattan, drew about half as many people as in past years.

Rivera’s goal is to draw 500 or 600 to Invest Northwest, roughly on par with the past.

“Attendance being down from previous years is my biggest fear,” Rivera says. “You always want to make sure the attendance is where you want it, and you want people to walk away in the end and feel it was valuable to them.”

With about four weeks still to go, more than 200 people have registered for Invest Northwest, Rivera says. Many people have historically tended to sign up in the last few days and weeks before the conference, so he thinks it’s still possible to reach the WBBA’s goal. As usual, the conference, in its eighth year, will feature about 60 companies from the Northwest in the business of biotech, medical devices, biofuels, and life sciences instruments.

What most of these companies have in common is that the work requires years and years of product development cycles, and long periods of relying on investment capital to keep the business going before it can even think of turning profitable.

Since many investors aren’t in the mood to make that leap of faith during a downturn, Rivera is turning to another source of vital capital to these startups—the Big Pharma industry. The industry is full of companies that have struggled to innovate and keep their pipelines full of promising new products that can replace established moneymakers that are losing patent protection year by year. Rivera is hopeful that some of these companies will step in and provide essential capital to help support local biotechs, as Danish drugmaker Novo Nordisk did in December through a partnership with Seattle-based VLST.

Combine those folks with angel investors who are taking an increasing interest in life sciences, and some venture capitalists with longer-term investing horizons, and Rivera thinks there will be a mix of people who can help keep life sciences innovations moving ahead. This will not be the place for big names from places like Fidelity, T. Rowe Price, or Wellington Management, who like to invest in the industry’s rock stars, such as Genentech, Amgen, and Gilead Sciences.

“The model of the industry is different than it was five or 10 years ago,” Rivera says. “To go from an idea to the market is really tough. Companies need to partner along the way, and that’s why we’re bringing licensing executives from Big Biotech and Big Pharma.”