Lack of support drives scientists away from Valley

August 1, 2008

By Flinn Foundation

[Source Phoenix Business Journal, Angela Gonzales] – The Valley is suffering from a case of brain drain this summer.

Effective Oct. 31, Dietrich Stephan is leaving his post as deputy director for discovery research and director of the neurogenomics division at the Translational Genomics Research Institute in Phoenix.

His departure comes on the heels of Dr. Andrew Skodol leaving his position as CEO of the Institute for Mental Health Research. Skodol is taking with him Dr. Donna Bender, who left Columbia University last year to become IMHR’s research director.

While Skodol and Bender plan to stay in Arizona — they are starting a research nonprofit in Tucson — Stephan is moving to California to run a company he co-founded called Navigenics Inc.

Stephan said tried to get venture capital to finance Navigenics and the other company he started in 2006, Amnestix Inc., but the only VC interest was from California sources. So, he set up headquarters for both operations there and traveled between the two states to run his companies and conduct research at TGen.

A month ago, he sold Amnestix to a European pharmaceutical company. Although he declined to reveal the sale price, he said TGen had a 5 percent equity stake in Amnestix.

“My goal was to bring all that information back to TGen and assist in building the infrastructure in Arizona,” he said. “Arizona is on the cusp of being able to do this, but we need to really focus on it and get it done.”

Losing Stephan’s two biotech startups follows the 2007 departure of Michelle Hanna’s Ribomed Inc. to San Diego.

Barry Broome, president and CEO of the Greater Phoenix Economic Council, said Arizona doesn’t have a comprehensive economic development plan. In addition to a dearth of venture capital, he said the state continues to lack lab space for biotech startups.

Broome scoffed at the state funding for Science Foundation Arizona.

“The $25 million is a small sum of money that keeps the concept alive, but not enough money to change our competitive position,” he said.

Stephan, who had his own struggles attracting funding, was instrumental in advancing research through the Southwest Autism Resource and Research Center.

Denise Resnik, one of SARRC’s co-founders, said she hopes to find other opportunities to work with him.

“Dietrich’s contribution to the autism program has been huge,” she said.

And the departures continue.

Dr. Marlene Freeman recently left the psychiatry department at the University of Arizona in Tucson, as did Dr. Alan Gelenberg, who chaired that department. Dr. Timothy Vollmer is vacating his spot as chairman of neurology at St. Joseph’s Hospital and Medical Center in Phoenix to move to Denver.

Mike Meyer, chairman of IMHR, said the nonprofit didn’t have enough funding to continue to pay Skodol and Bender. Over the past five years, IMHR has given $1.5 million in seed grant funding to researchers focusing on mental health issues. That funding generated $4.5 million in additional grants.

But the funding stream from the Arizona Legislature dried out, and IMHR was not able to supplement it with private and foundation donations, Meyer said.

“You’ve got this brain drain going on.” he said. “With the lack of funding, we couldn’t continue to support Andy and Donna.”

Carol Lagesse, who ran IMHR’s administrative office, also left.

Still, Meyer said, IMHR isn’t closing its doors. The volunteer board will continue to give seed funding to mental health researchers, as long as it is able to raise about $500,000 through private donors this year.

Skodol, who previously headed up the New York State Psychiatric Institute and was a professor of clinical psychiatry at Columbia University, said he was disappointed. He had hoped to start an evaluation, training and treatment center to specialize in personality disorders at IMHR.

Instead, he has formed the Sunbelt Collaborative, a nonprofit dedicated to collaborating with other research centers throughout the Southwest. He said it is best to be close to UA’s psychiatry department in Tucson.

Skodol said Arizona’s talent drain doesn’t bode well.

“You are losing more scientists than you are attracting at this point, at least in mental health,” he said. “I know people who have moved on who wanted to stay, but the support elsewhere is much greater.”

For example, IMHR tried to put up some money to keep Freeman in Arizona, but couldn’t get matching funds from UA, he said. Now she’s at Harvard Medical School and recently appeared on the cover of the New England Journal of Medicine for her research.

Gelenberg was a similar story. He had wanted to start a bipolar program at UA, but couldn’t get the support and now is in Wisconsin, Skodol said.