Private bio-science companies and U look to spur innovation


During the last few years of his 24-year run as a Medtronic executive, Dale Wahlstrom, a native Minnesotan, was saddened when he had to make more and more investments outside of his home state to stay competitive.

So when Mayor R.T. Rybak and several city council members asked Wahlstrom, now head of the BioBusiness Alliance of Minnesota, to prepare a plan to create a prominent life sciences industry in an underutilized area near the University of Minnesota, he couldn’t refuse.

“Minneapolis is a special environment because it has so many of the components right here,” Wahlstrom said of the area’s many hospitals, medical companies and researchers at the University. “It has explosive potential.”

The result was a statewide model outlining the components necessary to create a successful bioscience industry – founded upon education, infrastructure and policy – and it’s being used to spur innovation by placing private bioscience companies near the University’s burgeoning $292 million Biomedical Discovery District.

Although development on some of the University’s bioscience facilities is already underway, construction of private research facilities could be a couple years off because the land is currently owned by several different entities and no official agreements with businesses have been signed.

The idea behind the one-page model, dubbed the Minnesota Life Science Community, is to create an ecosystem that allows bioscience to serve as a major portion of the economy, Wahlstrom said.

In this case, it will work by placing private bio-science companies, such as medical device and gene therapy companies, in close proximity to academic research facilities in hopes that the two will collaborate.

“The private sector is usually behind lock-and-key at the company level, not really available for the community to turn into economic advantage,” he said.

Historically, this model has spawned such breakthroughs as the pacemaker back in the 1950s, Mike Christenson, director of the city’s Department of Community Planning and Economic Development, said.

“For years, we’ve had this industrial area of Minneapolis waiting for job growth and now it appears that we have a roadmap to follow,” Christenson said.

The Life Science Community model can be applied at any level, Wahlstrom said. Although the University provides Minneapolis with good access to skill sets and resources, it’s still important to look beyond the city walls to fulfill its needs.

“It’s a matter of looking at everything you need to be successful,” he said. “If you don’t have it, find out where to find it.”

The model is a portion of Destination 2025, a 20-year strategic plan released in January detailing recommendations for the six life science markets in the state to achieve economic competitiveness.

Representatives from the University participated in the two-year study to develop Destination 2025, including Frank Cerra, vice president of the Academic Health Center and Tim Mulcahy, vice president for research.

The development site covers roughly 60 percent of the Southeast Minneapolis Industrial area, a 700-acre swatch of land northeast of the University that has been on the city’s radar for decades, but now houses only grain elevators, railroad storage and small businesses, Christenson said. In 2003, Governor Tim Pawlenty included it in the 1,500 acres designated as the Minnesota Bioscience Zone, located in the Twin Cities and Rochester. Bioscience companies within the zones receive a variety of tax exemptions.

Currently, the area remains broken into several different sectors of ownership, including railroad companies such as Union Pacific, the city, private developers such as Hubbard Broadcasting and the University, which can make real estate development very complicated, Haila Maze, senior planner for CPED’s Planning Division, said.

“With things that are as complicated and multi-jurisdictional as these, it’s not usually fast-going,” she said.

John Wall, of real estate developer The Wall Companies, owns 15 acres of SEMI, with which he plans to create the Minnesota Innovation Center, a portion of SEMI that will someday house bioscience companies.

“It’s so motivating to think we could have a project like that,” he said, “it’d be an economic engine for the entire Midwest.”

The Innovation Center would serve several functions, he said. Aside from the vital task of commercializing research into the economy, it would benefit students by having them work directly with companies – perhaps even attending classes in their labs – in addition to allowing students to form relationships with companies that could eventually become employers, he said.

Now that the city has cleared old grain elevators, railroad tracks and buildings from the site, it’s ready to begin construction of new buildings, Wall said.

“We would love to secure our first tenant any day now,” he said.

The city has been in the process of planning roads that will cross through the SEMI area, developing storm water runoff systems, demolishing grain elevators and assessing the environmental damage of contaminants left over from the rail yard and manufacturing companies, Maze said.

“We’re nearing the end of the process where it’s all process,” she said, “and we’re getting closer every day to the part where we actually start building something over there.”

Some businesses currently located in the SEMI area won’t have to move, and the city will support their expansion, Christenson said. In other cases, the city is helping them relocate, he said.

To achieve real economic growth, Minneapolis must learn to balance its priorities, Wahlstrom said.

“It’s not like you can just invest in research or just invest in manufacturing and have a sustainable future,” he said. “You have to invest in both. You have to support all components or else it becomes less optimized than it could be.”