Michigan Tech Bear Bones Research Gets a Boost
July 11, 2008—
The steady stream of funds supporting the commercialization of Michigan Tech bone-research technology as a treatment for osteoporosis continues.
The UP Business Capital (UPBC) group, an arm of Northern Initiatives in Marquette, recently invested $50,000 to help move the venture forward.
“This is equity capital, not a loan,” says James Baker, director of Michigan Tech’s Technology and Economic
Development office. “They see the promise. They are willing to risk their investment because there is the potential upside, but there are no guarantees.”
Northern Initiatives is a nonprofit community development corporation that strives to enhance the regional economy with a simple but ambitious goal—supporting start-up companies and getting established companies to relocate to the UP.
Baker describes the infusion of money for the bone research as “significant and essential.”
“High-risk financing for technology start-up companies is difficult to get in this region,” he says. “People are justifiably cautious about speculative bets. But a willingness to take a calculated risk has grown high-tech economies elsewhere in the country, and we hope to emulate that.”
It’s an investment in the future, says UPBC’s Kathy Leone, vice president for commercial loans. “Our goal is to strengthen communities with increased jobs,” she says.
The work centers around technology being developed by Michigan Tech’s Seth Donahue, associate professor of biomedical engineering. He has isolated a bone-building biomarker in the blood of black bears, which don’t lose bone strength during hibernation. If humans were off their feet like that, Baker says, “bones would deteriorate very rapidly and very noticeably.” Donahue has evaluated the compound and is encouraged; more laboratory tests are under way.
Donahue’s work has caught the eye and the pocketbook of other backers. Over the last four years, support has come from the Michigan Universities Commercialization Initiative and the National Institutes of Health.
“Osteoporosis is a widespread disease,” Baker says. “From a business standpoint, the upside potential is significant. A lot of companies are pursuing this market, and the competition is stiff. The prize is big, but the fight is also hard.”
The Apjohn Group in Kalamazoo, Michigan, supports start-up biotech companies, particularly in pharmaceuticals. The firm has procured the commercial rights to Donahue’s technology.
Apjohn founded Aursos Inc., a biotechnology company headquartered in Houghton with operations in Kalamazoo. Donahue is chairman of the advisory board of Aursos, which is raising money for the initiative and sought the capital from UPBC. Overall, the endeavor has attracted $500,000.
“It’s seed funding to raise bigger funding,” says Ronald Shebuski, chief scientific officer of Aursos and a partner with Apjohn.
Shebuski says that principals in the initiative are “very pleased” about the financial support from UPBC.
“It’s helping us grow the UP economy,” he says. “It’s quite encouraging. We’re very enthusiastic.”
Shebuski says that all of this collaboration is galvanized around the vision of reaching a national market —a treatment option for millions of people, especially women, affected by osteoporosis.
Shebuski believes there’s “a high likelihood” that a mid- to large-sized pharmaceutical company will acquire this emerging technology.
He compares the initiative to the cholesterol market, which has spawned many products totaling several billion dollars.
Similarly, he says, “A small part of the osteoporosis market would be significant.”
With that kind of potential, those involved expect to continue to garner support from grants, angel capital (wealthy investors), matching funds from the state and venture capital.
Michigan Technological University is a public research university, home to more than 7,000 students from 60 countries around the world. Founded in 1885, the University offers more than 120 undergraduate and graduate degree programs in science and technology, forestry, business and economics, health professions, humanities, mathematics, and social sciences. Our beautiful campus in Michigan’s Upper Peninsula overlooks the Keweenaw Waterway and is just a few miles from Lake Superior.