The Bio-Entrepreneur
Alum Ken Carter founded a company to speed the process by which drugs are created. Now he just has to prove to Big Pharma that it works
GSBS alumnus Ken Carter says he sometimes feels a little like Magellan must have felt--he thinks he's onto something big, but the hard part is convincing others that he's right. As CEO and founding president of Avalon Pharmaceuticals in Gaithersburg, Maryland, forty-three-year-old Carter has proven convincing enough thus far to get initial investors on board in 2000 and 2001 and raise $70 million-one of the largest accumulations of private capital ever amassed by a U.S. biotechnology firm. The draw for venture capitalists is some stunning new technology that he says soon may bring potent, side-effect-free cancer drugs within reach of those who need them. But until that first drug meets Food and Drug Administration approval, Carter is on the hunt for pharmaceutical companies that will agree to enter into partnerships with Avalon and to help him persuade the world that conventional methods of drug discovery are all but obsolete.
"We believe what we're doing has the potential to transform the way pharmaceutical discovery work is done," Carter says. For a man with such an awesome conviction-a man who hob-knobs with senior executives at "Big Pharma" (as the pharmaceutical industry collectively is called) and whose company has broken a Wall Street record-Carter's manner is surprisingly casual. During our interview, he laughs at himself when he has trouble retrieving a message from his new cellular phone. "Genetics is a breeze compared to this," he says, grinning as he pushes the little buttons.
Carter remembers the day his view of the world started to shift. It was 1981, and he was a junior at Abilene Christian University on a spring break trip with friends when he stumbled on a copy of Time magazine featuring a cover story about Herb Boyer. Co-founder and chief scien tist of the world's first genetic-engineering com pany, Genentech, Boyer had cloned the gene for human insulin in 1978. Boyer's story triggered in Carter a train of thought-that genetic in formation had potential to cure disease-that gained momentum during his years at UTMB, where he studied the genetic response to inflammation in the liver, working under Dr. John Papaconstantinou, professor of human biological chemistry and genetics. Papaconstantinou recalls being impressed with Carter's laboratory work, but he was even more impressed with the young man's sense of purpose. "Kenny knew early on the route he wanted to take," he says.
Carter graduated from UTMB in 1989 as researchers raced to map the human genome, and went to the University of Massachusetts Medical School, where he was granted the third-ever postdoctoral fellowship given by the NIH Human Genome Project; some of his work was featured on the cover of Science in 1993. That year, Carter was among the first scientists recruited by Human Genome Sciences, where he developed and directed the company's gene mapping initiative. In 1999, when the scientific world was beginning to ask, "What's the next step?" regarding the genome, Carter found himself at a crossroads: Should he continue studying the human genome-a job he found incredibly exciting-or help start a "next generation" genetics company that would apply what was known about the genome to drug discovery?
For advice, he turned to his UTMB mentor, and Papaconstantinou did not mince words. "I told him he needed to weigh the risks: that should the business fail, the venture would greatly affect his ability to get back into academic medicine," Papaconstantinou says, noting that the academic world would expect ongoing research. "But I let him know I felt that he could do what he was wanting to do. And what he did took a lot of guts."
With backing from some big-name scientists, including Alan Walton, co-founder of several of the nation's most prominent biotechnology companies, and Bradley Lorimer, a former vice president for Johnson & Johnson who had grown frustrated with the snails' pace of drug discovery, Carter made his decision in January 1999: "I quit my job and for a year made cold calls from my basement to venture capitalists," he says. He raised $10 million that year, selling investors on his hope of a better cancer drug, and sooner.
It's a goal he's still selling three years later, and one that seems to him more attainable every day, Carter says. With several drug candidates already patented, Carter now spends most of his time wooing senior executives at pharmaceutical companies to help Avalon with the $500 million it costs to get a new drug to market. With such high stakes, executives greet Avalon's revolutionary approach with skepticism, if not blunt disbelief. Carter explains to them that, whereas traditional drug discovery means investigating a compound's effect on a gene's "target" protein, Avalon allows scientists to do what few had ever dreamed possible-to look simultaneously at a compound's effect on the genes of every cell in the body. In this way, scientists considering a new compound can gather vast amounts of information at warp speed. When Big Pharma executives ask Carter to validate his claims by investigating a pilot drug, Avalon can produce in mere weeks a wealth of information about pros, cons, and side effects that the traditional drug company may have spent years uncovering.
Avalon's speed and accuracy is made possible by its one-of-a-kind discovery platform, which was built through partnerships and collaborations with several service companies-robotics and technologies firms for the miniaturized wet-lab, and, to do what Carter says is the most difficult part, bioinformatics application services that interpret the baffling amount of data the lab generates. Because this discovery platform renders it unnecessary to identify target proteins, Carter says Avalon can shave one to three years off the drug discovery process; and because the compound screening investigates effects on healthy as well as unhealthy cells, the drugs discovered should have far fewer side effects.
In short, what often has been assumed about drug discovery-that it is a slow process, and that the drug carries almost as many risks as benefits-need not be assumed any more.
It's a lot for Big Pharma to chew on, but Carter does not seem discouraged by the industry's incredulity or frightened by the risk of failure. Until that first drug hits the market, Avalon can be likened to Magellan trying to send a message home, Carter says. "Magellan didn't doubt for one second he was three-quarters of the way around the world."