In an unnamed laboratory located between the campuses of Harvard and the Massachusetts Institute of Technology, a group of scientists are searching for the next billion-dollar drug.
Funded with $500 million from some of the wealthiest families in American business, the group has caused a stir in academia by dangling seven-figure payouts to lure highly qualified college professors into a for-profit bounty hunt. His goal, in his own words: to avoid the bottlenecks and paperwork that slow down traditional paths of scientific research at universities and pharmaceutical companies, and to discover a multitude of new drugs (initially for cancer and brain diseases) that can be produced and sold quickly. .
The Braggadocio of startups is an extremely rigid approach, and many former academics have founded biotech companies in the hope of getting rich from their great discoveries. This group, which boasts the name Arena BioWorks by quoting a quote from Teddy Roosevelt, doesn’t have a single idea, but it does have a big checkbook.
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“I make no apologies for being a capitalist, and motivation for a team is not a bad thing,” said tech mogul Michael Dell, one of the group’s big-money backers. Others include heir to the Subway sandwich fortune and owner of the Boston Celtics.
The problem is that for decades, many drug discoveries have not only originated in colleges and universities, but have also generated profits to help fill endowment coffers. The University of Pennsylvania said it has earned hundreds of millions of dollars from research into mRNA vaccines used against Covid-19.
According to this model, any such unexpected event will remain private.
The arena had been operating in stealth mode since early fall, before turmoil over Israel and Hamas erupted at colleges along its border. But researchers moving to the new lab say the impetus behind it has become sharper as the reputations of higher education institutions take a hit. They say they are frustrated by the slow pace and administrative woes at their former employers, as well as what new hire J. Keith Joung calls “terrible” pay at Massachusetts General Hospital, where he worked before Arena.
“It used to be that moving from academia to industry was considered a failure,” said Joung, a pathologist who helped design the gene-editing tool CRISPR. “Now the model is reversed.”
The motivation behind Arena has scientific, financial and even emotional components. Early backers first thought about the idea in a conversation at a mansion in Austin, Texas, in late 2021; Dell, along with Facebook’s first investor James W. Breyer and Celtics owner Stephen Pagliuca, talked about this issue with each other. seemingly endless requests for money from college fundraisers.
Pagliuca donated hundreds of millions of dollars, largely devoted to science, to his alma maters Duke University and Harvard. This earned him a seat on four advisory boards for institutions, but he began to realize that he had no concrete idea of what all that money was producing, other than his name on a few plaques outside various university buildings.
In the following months, these early backers met with Boston venture capitalist and trained medical doctor Thomas Cahill to devise a plan. Cahill said it would help find scientists from companies like Pfizer, as well as disillusioned academics willing to give up demanding university positions in exchange for a big cut of the profits from any drugs they discover. The Arena’s billionaire backers will keep 30 percent, with the rest going to scientists and overhead.
Science for profit is nothing new, of course; The $1.5 trillion pharmaceutical industry provides ample evidence of this. Business moguls like Jeff Bezos and Peter Thiel have poured hundreds of millions of dollars into startups trying to extend human lifespans, and scores of pharmaceutical companies have raided universities for talent.
A significant percentage of drugs are obtained from government or university donations, or a combination of the two. According to the scientific journal PNAS, each of the 210 new drugs approved by the Food and Drug Administration from 2010 to 2016 was linked to research funded by the National Institutes of Health. A 2019 study by Jeffrey Flier, former dean of Harvard Medical School, said the majority of “new insights” into biology and disease come from academia.
This system has long-standing advantages. Often aided by their nonprofit status, universities have a virtually unlimited supply of low-wage research assistants to assist scientists with early-stage research. Groundbreaking drugs, including penicillin, emerged from this model.
The problem, according to scientists and researchers, is that it can take years for university institutional approvals to advance promising research. The process, which aims to eliminate unrealistic proposals and maintain safety, can require writing lengthy papers that can consume more than half of some scientists’ time. By the time funding is secured, the initial research idea is often already stale, setting off a new cycle of grant applications for projects that are sure to become obsolete in their own time.
Stuart Schreiber, a longtime Harvard-affiliated researcher who left to become Arena’s chief scientist, said his more unorthodox ideas rarely received support. “It got to the point where I realized the only way to get funding was to apply to study something that had been done before,” Schreiber said.
A pioneering chemical biologist in fields such as DNA testing, Schreiber’s cachet helped attract about 100 researchers to Arena. Harvard declined to comment on his departure and that of others he helped attract.
There is an air of calculated secrecy in Arena’s operations. Joung, who resigned from Mass General last year, said he did not tell his former colleagues where he was going and some asked him if he was terminally ill. Cahill said many scientists he hired quickly had their university email access disabled and received harsh threats of legal retribution if they tried to recruit former colleagues.
The five billionaires backing the Arena include Michael Chambers, North Dakota’s richest man and manufacturing mogul, and Elisabeth DeLuca, the widow of one of the founders of the Subway chain. They each invested $100 million and expect to double or triple their investment in subsequent rounds.
In confidential materials provided to investors and others, Arena describes itself as “privately financed, completely independent, publicly owned.”
Arena’s supporters have said in interviews that they do not plan to completely cut donations to universities. Duke turned down an offer from Pagliuca, an alumnus and board member, to set up part of the lab there. Dell, a major donor to the University of Texas hospital system in its hometown of Austin, has leased space for a second Arena lab there.
Schreiber said it would take years and billions of dollars in additional funding for the team to learn whether its model leads to the production of a valuable drug.
“Will it be better or worse?” said Schreiber. “I don’t know, but it’s worth a try.”
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