A Metro on the Brink

Bill Johnston

"Nationally, most people might not recognize the Atlanta area as a bioscience cluster, but I image that within the next few years it will gain that recognition – it's happening," says Dr. William Johnston, president and CEO of Alpharetta, Ga.-based Inhibitex, a developer of antibody-based treatments for bacterial and fungal infections. One product currently in Phase II trials is designed to prevent staph infections in premature infants. Johnston serves on the Metro Atlanta Biosciences Council along with Dr. Michael Johns, executive vice president at Emory Healthcare, and David Dodd, president and CEO of Serologicals Corp.
        "The strong academic research piece is here," says Johnston, "which is typically a critical component for creating a good biotech initiative. Our venture capital piece is light. We don't have a heavy-duty venture capital base here in Atlanta that is healthcare directed. But a lot of particularly East Coast investors seem to have become very comfortable with investing in Atlanta-based companies. That transition has occurred since we've been here, which is five years."
        "A few life science companies in the Atlanta area have gone public successfully, and others are poised to do so," notes Johnston. Among these is Inhibitex, which raised $45 million in 2002 in one of the most significant biotech financing rounds in the country last year. The round was not only significant from a dollar-value perspective. "The hurdle for a company to be public has been raised very high," says Johnston. "Today, you need to be in very late stage-two trials and be able to demonstrate efficacy – in reality, you need to be a Phase 3 company to get public. That's what we're hearing from the investment banking community. [Alpharetta, Ga.-based] AtheroGenics is now out there as a public company, and any company that is a part of the next batch of companies to do so, as we will likely be, their location will begin to be viewed as a place where biotech can happen," adds Johnston. "I believe Inhibitex will be the second public biotech company in the area, which will facilitate Atlanta beginning to be thought of as a cluster."
        In January 2003, Collgard Biopharmaceuticals announced it would move its headquarters from Boston to Atlanta, keeping a presence in Boston and its research and development operations in Israel. Collgard is a clinical-stage developer of tissue-repair treatments.