Genetic research venture in Fairfax County loses funding and falls apart

Even to Dietrich Stephan, a genetic researcher shopping his idea for a potentially revolutionary $400 million molecular laboratory, it all sounds like science fiction. He says he's trying to "change the world" one DNA sequence at a time. The goal is to create "miracle drugs" -- something that could wipe out cancers, Alzheimer's and autism.

All Stephan needs is money. Preferably $100 million to start.

Stephan, 40, has logged stints at Johns Hopkins University and the National Institutes of Health, founded two labs that develop made-to-order genetic profiles for patients and identified 10 genes that cause Lou Gehrig's disease, all the while making inroads in the study of brain cancers and leukemia.

But his latest venture, a much-publicized plan for a 300,000-square-foot personalized medicine laboratory in Fairfax County called the Ignite Institute for Individualized Health, fell apart last month because of two things Stephan is not so experienced at mapping out: politics and funding. When a publicly traded technology firm withdrew its $25 million investment last year, Ignite's hospital partner, Inova Health Systems, followed suit with its $25 million commitment. By April, Fairfax had abandoned its tax break plans for the genome center, which had been announced at a ceremony in November attended by then-Gov. Timothy M. Kaine (D) and Gov.-elect Robert F. McDonnell (R).

It was a rather quick and disappointing failure for the region's biotechnology industry, underscoring the difficulty in getting such research-based medical projects funded during harrowing economic times, according to Washington area officials, business leaders and medical researchers. Sitting unused are $25 million in Virginia public grants that had been earmarked for Ignite. And Stephan is now searching for a new home for his unfunded laboratory.

"We need solutions. We need original thinking, and I still believe that it's a foundation, a research-based place like Ignite, that can find the next billion-dollar cure," Stephan said Monday in an interview. "I see this as a huge opportunity."

Ignite was meant to bring together 400 world-class scientists in a state-of-the-art facility that officials said would be the nation's proving ground for personalized medicine, including gene isolation in an effort to diagnose diseases in patients years before symptoms crop up. Stephan purchased 100 second-generation DNA sequencers at an undisclosed cost, allowing researchers to map 7,500 full human genomes per year. The machines would make Ignite the largest facility of its kind in the Western Hemisphere.

But Inova officials say they soon found themselves alone when it came to "non-contingent" dedicated dollars. Todd A. Stottlemyer, executive vice president of corporate services at Inova, which had hoped to be the clinical side of Ignite, said the research lab's potential was only outweighed by its ambitious funding plan in the current economic environment.

"It wasn't that we didn't believe in it," Stottlemyer said. "It's that we were the only ones left funding Ignite at the end of the day."

Sometime last year, Stephan said, a corporate investor that he declined to identify pulled its $25 million verbal commitment after its board decided it could not spend the money in such a depressed market. Inova officials say they couldn't afford to be out on their own with the project; Stephan and his team say they had patched the funding gaps with a number of private and philanthropic investors.

Fairfax County Supervisor Penelope A. Gross (D-Mason), who has served as the county's representative on the Inova Health board and who helped broker the Ignite deal, said the county had no choice but to withdraw its own commitment of up to $150 million in industrial revenue bonds after Inova had left the table.

"Ignite had the potential for being a transformative industry in Fairfax County," she said. "It was very disappointing that we couldn't make the economics work."

In many ways, personalized medicine is still in its infancy but many believe it is the predictive, and preventive, health care of the future. Inova has focused its personalized medicine research efforts on three areas -- cardiology, oncology and neurology. Edward Abrahams, executive director of the Personalized Medicine Coalition, a Washington-based industry trade group, said the practical applications are already being felt in area hospitals, including Shady Grove Adventist Hospital in Rockville.

"A lot of investment is headed this way, and it's because personalized medicine offers solutions to large-scale health-care problems," Abrahams said.

As Stephan and his team wrap up their failed partnership with Inova, they are surveying at least six potential sites, including the Washington area, for their new lab. "We're talking about weeks, not months, and we've been bouncing around the country trying to find that right magical mix of a place," he said.

His dream is to create billion-dollar pharmaceutical drugs that can prove effective in cancers and other diseases. He highlights the drug Imatinib, marketed by Novartis as Gleevec in the United States, which is approved to treat a certain type of chronic myeloid leukemia and another type of cancer called gastrointestinal stromal tumor.

All he needs now is the money.