I recently wrote about some outside biotechnology companies choosing Orange County for expanded operations.
Dendreon Corp. of Seattle, Los Angeles-based Abraxis BioScience Inc. and Agendia NV of the Netherlands have set up operations here or are doing so.
That prompted questions about whether the county—known as a hub for makers of medical devices along with a sprinkling of traditional drug makers—eventually could become a “biotech cluster.”
Biotech clusters are linked to anchor companies and founders, according to James Bova, an OC-based partner and Pacific Southwest regional life sciences sector leader for Deloitte Consulting LLP.
That’s because managers and scientists often leave companies and start their own.
San Francisco, which is known for its biotech companies, is fueled by a few big “grandfather” companies that have set up shop there.
They include Genentech Inc., a drug maker that’s now part of Switzerland’s Roche Holding Ltd.
Genentech has spawned some 20 biotech companies in the San Francisco area, Bova said.
Tularik Inc. was cofounded by a former Genentech scientist and later was sold to Thousand Oaks-based Amgen Inc., which still runs it as a unit in South San Francisco.
The greater Los Angeles area never has established itself as a biotech cluster because its main founder, Amgen, only has spawned three companies, according to Bova.
The anchor model worked for San Diego, according to Bova, where Hybritech Inc. is considered the grandfather of the area’s biotech business.
Hybritech, which was founded in 1978, made diagnostic tests for allergies, pregnancy, anemia and prostate cancer. In 1986, Indianapolis-based drug maker Eli Lilly & Co. bought Hybritech.
In 1996, Lilly sold Hybritech to Fullerton-based Beckman Instruments Inc., the predecessor of today’s Beckman Coulter Inc., which is moving to Brea.
As with Genentech, many former Hybritech employees went on to found San Diego biotech companies.
“One could argue that Hybritech was directly responsible for forming the San Diego biotech cluster by creating (more than) 40 biotech entities,” Bova said. “Orange County doesn’t have a Hybritech story yet and will probably need to grow organically.”
Other factors that go into biotech cluster development include strong universities and “supportive public policy and a strong social structure,” Bova said.
OC’s starting to see a hub form around the cancer fighting and diagnostic businesses of Dendreon, Agendia and Abraxis, along with locally established companies such as Clarient Inc. of Aliso Viejo.
Dendreon is developing Provenge, a treatment for prostate cancer. Agendia’s MammaPrint test assesses a woman’s risk for breast cancer and Abraxis’ Abraxane drug treats breast cancer.
Sun Units Settle
Harborside Healthcare and HHC Nutrition Services, two business units of Irvine-based Sun Healthcare Group
Inc., have agreed to pay $1.4 million to resolve charges of taking kickbacks from a supplier, according to the Justice Department.
The department alleged that Harborside, which Sun bought in 2007, took kickbacks from San Francisco-based McKesson Corp. and its affiliate MediNet in exchange for Harborside purchasing medical equipment from them.
There was a related action pending against McKesson and MediNet that remains ongoing in Mississippi.
Avanir Bounce
Avanir Pharmaceuticals Inc., an Aliso Viejo drug maker, got some good news on its lead drug candidate earlier this month.
Avanir’s shares shot up nearly 15% on Oct. 7, when it said that it would be getting an extension on its patent for its lead drug candidate, Zenvia. The move extends Avanir’s exclusive right to sell Zenvia until 2025.
Zenvia now is in a late-stage clinical study as a treatment for involuntary emotional expression disorder, where patients can’t control outbursts of crying or laughing.
Involuntary emotional expression disorder affects an estimated 2 million Americans with multiple sclerosis, Lou Gehrig’s disease, stroke and other neurological diseases or trauma than can cause brain lesions.
Avanir expects the Food and Drug Administration to have a decision on Zenvia in the second half of 2010.
The drug maker, with a market value of about $200 million last week, has been working on Zenvia for some time.
Back in 2006, the FDA said Zenvia could be approved, but said it was concerned that one of its active ingredients might lead to heart problems.
Regulators asked for more testing, and Avanir eventually started a round of clinical studies with a revised Zenvia formulation.
Bits and Pieces
Mission Viejo-based Aeolus Pharmaceuticals Inc. completed a $1.65 million financing with several existing institutional shareholders, including Connecticut’s Xmark Opportunity Partners LLC. Aeolus said it would use the money for several purposes, including developing its AEOL 10150 drug candidate … Antigen Discovery Inc., an Irvine biotech company, said it received a $1.8 million grant from the National Institute of Infectious Diseases to develop a vaccine for Chlamydia, a sexually transmitted disease.
