Winston-Salem one of the ten cities in the nation leading biotechnological innovation-Winston-Salem chronicle

By Algenon Cash

Of its origin, Winston-Salem is a city of great ideas and innovations. The city built international brands – BB&T (now Truist), Wachovia (now Wells Fargo), RJ Reynolds (now Reynolds American), Hanesbrand, Krispy Kreme, Piedmont Airlines. But we couldn’t keep them.

Our ability to create is indisputable, but our attempt to maintain what we are building? It’s not that great. Companies born in Winston-Salem have organized a mass eviction over the last few decades.

We are now at another turning point, this time in biotechnology and regenerative medicine. The WFIMM Institute of Regenerative Medicine (WFIMM) is a leading innovative studies in organ regeneration, cell therapies and the treatment of chronic diseases.

Winston-Salem is one of only the ten cities in the nation selected by the National Scientific Foundation (NSF) as the Innovation Center-the only one focused on healthcare.

Few people are aware that some of the most avant-garde medical breakthroughs are happening here. Dr. Anthony Atala, a world-renowned pioneer in regenerative medicine, was the first to create an engineering body to be implanted in a person. These patients are still walking.

“Dr. Atala really directs the scientific discipline of regenerative medicine, “Dr. Tim Bertram, the new chief employee of the WFIRM ecosystem,tOld Me during a recent interviewS “We have over 600 scientists working in different fields of regenerative medicine.”

The goal? Discover ways to use cells, genes and tissue engineering to create solutions for chronic diseases that current medicine cannot cure. This is an ambitious vision that could put Winston-Salem on the global card for biotechnological innovation.

For all his progress in research, Winston-Salem has not yet translated this advantage of jobs, investment and a real industry. This is a familiar story: we invent, we innovation and then … we lose it somewhere else.

Charlotte took our banking. Relog took our technological talent. Will we allow Boston, RTP or San Francisco to take our biotechnology industry?

But there is a challenge: scientific breakthroughs do not automatically lead to economic success. One of the biggest barriers to the transformation of medical discoveries into real-world treatment is not science-it is production.

“Producers represent 80-85% of failures in regenerative medicine,” Bertram explained.

This means that if Winston-Salem solves the challenge of producing biotechnology, we do not only attract start-ups-we reserve them.

“The reality is that after you have a mark on the production of biotechnology, you do not move,” Bertram said. This is a large-scale opportunity for the economic development of Winston-Salem. Unlike industries such as banking or technology, where companies can move for better incentives after biotechnology companies are building manufacturing facilities, they do not leave.

But biotechnology production is not cheap.

“The average price for opening from the lab to a commercial product is over $ 2 billion,” Bertram told me. “That is why we are struggling to attract risk capital. Investors want exit strategies. “

Winston-Salem has a lot of wealth, but it is a conservative wealth. The families in the city have built savings through more traditional industries – agriculture, textiles and production. Investors are excited about throwing money into another residential building in Main and Main – but they will not take the same risks from startup companies for biotechnology. The city is full of intelligent savings, but they are pressing at risk.

Bertram knows this problem first -hand.

“When I started Proki, we raised a few million dollars from local investors. A year later, they received a 12 -fold return. “

But in order for a company to grow outside its early stages, it needs hundreds of millions or even billions of funding.

Risk capital companies in Boston, Silicon Valley or Austin will not fund Winston-Salem unless it moves to their city. And wealthy investors in Winston-Salem are not comfortable to make the species high-risk, high rewards that biotechnology requires.

Bertram works on a concept he calls a “kind capital”-a structured investment platform that brings together local capital and defines the opportunities for biotechnology at an early stage.

“We need to help investors understand the real likelihood of success,” he explained. “In medicine, 95% of things fail. But if we risk science, we prove the production process and show a clear regulatory path, we suddenly go from 5% likelihood of success to 50% or more. This changes the investment equation. “

He believes that the unique combination of Winston-Salem’s biotechnological innovations, qualified workforce and production history can create an industry for sustainable life sciences-if we allow it to flow.

We have this culture of innovation and entrepreneurship, I told Bertram. But we were trying to keep it. It’s like trying to keep water -the more we get caught, the less we have.

Bertram also sees him.

“The talent is here. Science is here. The workforce is here. But we have to build the capital ecosystem around it, “he said. “We need people to stop looking at this as charity or economic development and to start seeing it as what it is – one of the most high -end investment opportunities in the next century.”

He is right.

In recent months, I have been difficult for Winston-Salem. Some may say too hard. My criticism of the economic direction of our city, our struggles to retain business and our inability to cultivate a thriving innovative economy have broken feathers. But after this conversation, I see a real way forward.

The only question is – will we take it?

Algenon Cash is a nationally recognized speaker and managing director of Wharton Gladden & Company, an investment banking company. Get to it[email protected].