Monday, April 05, 2010

Ignite Institute loses major funding partner

Ignite Institute for Individualized Health, a medical center startup hailed to be an economic development coup for Fairfax County, has lost one of its biggest sources of funding after Inova Health System’s board voted to pull out of the partnership.

But Ignite Institute’s founder said Inova’s decision doesn’t detract from his effort to launch the ambitious medical research institute, which was touted to bring nearly 500 world-class scientists to a newly built campus in the next five years to study personalized medicine.

“Ignite is absolutely going to launch and we’re on track to do so,” said Dietrich Stephan, president and CEO of Ignite Institute and originator of the idea.

Inova, which was one of the founding partners of the institute, said it could no longer back the venture after it ran into delays in raising additional funding.

“The money that they needed for the scope and scale for what was being proposed for the Ignite Institute was challenging at best,” said Tony Raker, a spokesman with Inova. “With the economic conditions, it became more of a challenge.”

Ignite had said it needed at least $150 million to start construction on a new campus. Inova had committed to pitch in $25 million, and Virginia had bestowed another $3 million from its Governor’s Opportunity Fund in an incentive grant. Just this week, Virginia Gov. Bob McDonnell signed into law another measure that frees $22 million for such a research institute, so long as it creates 415 jobs, through $5.5 million annual chunks available starting July 2011.

Ignite had said it planned to hire its first 100 scientists by the end of this year. It’s taking up temporary quarters in the Center for Innovative Technology building, while longer-term lab space is being built out in the next wing of the Herndon building.

Inova leaders had said the original plan to invest the $25 million in the institute was also based on Ignite’s ability to assemble a total $100 million, including the state commitments. Stephen M. Cumbie, Inova Health System board’s chairman, had said the team had come close to another potential $25 million grant from a national technology company that he wouldn’t name.

“But there was a change of CEOs and a pullback, and again a lot of this was being driven by the economy,” Cumbie said. “That and other prospects didn’t materialize.

“We were certainly concerned about starting down that road without the capital being raised,” Cumbie added. “The plan we felt great about. Dietrich is a world-class scientist, there’s no question about that. We had a lot of faith in him.”

With a key medical center partner leaving the table and a brutal economy still leaving wide budget deficits in its wake, Fairfax County leaders said they also can no longer support a multimillion-dollar bond that they had been considering to help locate Ignite Institute in a permanent residence in the county.

“Fairfax County has never before entertained even the idea of purchasing a building in partnership with an institute,” said Sharon Bulova, chairwoman of the Fairfax County Board of Supervisors. “For us, this was a very major consideration and therefore for us, there was a lot of risk associated with it, especially during this time. … Unfortunately, it just turned out not to be possible.”

But Stephan said he’s still collecting a syndicate of national partners and funders for the venture, describing these latest moves as a “reshuffling.” Ignite recently bought new gene sequencing equipment, making it the largest concentration outside of Asia to help scientists decipher through genes a patient’s predilection toward certain diseases.

“It’s mission-critical to maintain momentum,” Stephan said. “This is the future of medicine. Literally. Personalized, preventative medicine is the solution to our health care crisis today. It needs to be in the greater Washington area because of policy decisions. It will absolutely happen.”

Though, these are serious setbacks in an initiative that was grandly announced in mid-November at a press conference with two governors and a host of state, county and Inova leaders as an “accelerator” of the county’s infant biotech sector.

“I’m really disappointed that this didn’t work out, but I’m hopeful that something will come back, maybe in a different iteration,” Bulova said. “Everyone was very excited, very optimistic, and really thought that it could happen. And the harsh reality is that it was just a rough time to try to do something as ambitious as the Ignite proposal.”

Vandana Sinha
Washington Business Journal

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