Lending Center to Serve Labs

Pfizer Donates Costly Equipment That Others Will Be Able Borrow
Ann Arbor News - September 07, 2006

By Mike Ramsey
News Business Reporter

Pfizer Inc. is donating more than $1 million worth of lab equipment to create a new statewide lab equipment lending center in Ypsilanti designed to help small biotech companies.

Ann Arbor Spark - Washtenaw County's economic development and business accelerator organization - and the state biotech association, MichBio, have teamed with Pfizer to create the Michigan Innovation Equipment Depot.

Small companies with limited access to cash can apply through the state's 11 SmartZones to get the equipment, which they can use as long as they stay in Michigan or stay in business. SmartZones are regional collaborations between businesses, universities, governments and community organizations that help to facilitate growth of tech businesses.

David Canter, senior vice president and site director for Pfizer's Ann Arbor labs, said supporting life sciences is in the best interests of the state, the company and the people who benefit from biomedical research.

"Yes, I think we are going to watch this idea, we will learn from it, what went well, what needs to be improved and hopefully, the rest of my fellow sites in Pfizer R&D will use this as a template.''

Pfizer has traditionally disposed of extra, older equipment by donating it to research universities, but Canter said he wanted to make a formal effort to promote other biotech companies by getting the equipment in their hands. He approached Ann Arbor Spark and MichBio about coordinating a program to distribute the equipment.

This equipment, valued at $1.1 million in current resale value, comes from Pfizer's Ann Arbor and Kalamazoo research facilities. The cost of new equipment would far exceed $1.1 million.

The pharmaceutical giant employs more than 2,000 in Ann Arbor, and its presence here has helped foster the growth of other pharmaceutical companies. Pfizer, more and more, looks to other companies and universities instead of its own labs to develop drugs.
So giving equipment to startups could benefit the company in the long term.

Michael Finney, president and CEO of Ann Arbor Spark, said he plans to contact other well-established life science companies and equipment manufacturers to ask them to donate to the inventory at the depot.

To gauge interest in the depot, Spark and MichBio have contacted a few companies to get a feel. Finney said interest in items has been strong.

"We are already getting a lot of inquiries from companies around the state, and it's an indication of the kind of demand that is out there,'' said Finney.

Spark will process applications for equipment, managing the depot and seeking new partners. MichBio will assist in vetting the applications to ensure the appropriate businesses are awarded equipment and in advertising the depot to its members.

Stephen Rapundalo, executive director of MichBio, said he believes the depot is unique in the United States and will be a big boon to small companies that have just one, two or three employees.

"I think there's no shortage of startups that would love to get their hands on the equipment,'' he said.

According Michigan Economic Development Corp. statistics, there are 550 life sciences companies in Michigan, though a portion of them are service providers to biotech companies and don't do lab work.

Rapundalo said his goal is to approve applications within one month, so the applicants have the equipment quickly. The companies are required to pay an administrative fee of 1 percent of the value of the equipment.

Companies that get the equipment can use it for three years and then are evaluated to see whether they are still using the equipment. The idea is to allow them to use the equipment for the remainder of its useful life, Finney said.

Included in the 200 pieces of equipment is a mass spectrometer, which separates atoms or molecules based on minuscule differences in mass. A new one would cost about $330,000.

For a small startup like Cerenis Therapeutics, getting access to a $330,000 piece of lab equipment for a 1 percent fee could be a big help in growing the company.

"These are very, very useful pieces of equipment,'' said Bill Brinkerhoff, chief operating officer of the year-old company that has labs in Ann Arbor and France. "And a lot times, even though the equipment might be four or five years old ... they age well.''

Mike Ramsey can be reached at mramsey@annarbornews.com or 734-994-6864.