Wanted: Risk capital for biotech research

Published 12:00 am Wednesday, October 29, 2008

By Emily Ford
CHARLOTTE ó Finding investors poses the toughest current challenge for the N.C. Research Campus.
“Our biggest need is risk capital,” said Clyde Higgs, vice president of business for campus developer Castle & Cooke North Carolina. “You can’t go to Bank of America and get a $5 million loan on five patents.”
The campus needs venture capitalists to invest in start-up companies, Higgs said.
He spoke at the Charlotte Biotechnology Conference at the University of North Carolina at Charlotte, which brings together academics, industry and investors.
Higgs suggested that companies and investors present at the event “get to know each other.”
The nation’s economic downturn has slowed investment, said Kenny McDonald of the Charlotte Regional Partnership.
“The entire pipeline is at risk,” he said. “Even healthcare projects right now are having to struggle.”
But the health and life sciences sector still offers the greatest potential for growth in the Charlotte area, McDonald said. The industry has spurred massive investments in the past and created many jobs, he said.
Biotech will play a role in other growth industries in the region, including defense and energy, McDonald said.
The Research Campus has a venture capital fund that invested about $35 million in NovaRX, a cancer vaccine company directed by Justin Murdock, the son of Research Campus founder David Murdock. Justin Murdock said his company will open a research and development unit in Kannapolis next year.
An angel fund called IMAF will open in Kannapolis, said Higgs. And he is talking to “brand name” venture capital funds on both coasts.
The money can’t arrive too soon, audience members said. Industry looking for a place to grow needs venture capital in the Charlotte region “urgently,” said one business leader.
“I have to go where the money is,” he said.