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Posted April 24, 2002:
Behind the Biotech Boom
George Rathmann *51's enthusiasm for research and head for business gave rise to a $22-billion industry

By Argelio R. Dumenigo

The sidelines at the friendly football games George Rathmann *51 played in during his graduate school days at Princeton were frequented by some hard-hitting intellectuals.

On any given afternoon, Nobel laureate Albert Einstein or future winner John Nash *50 might stroll over to the field outside Frick Laboratory, where Rathmann and his chemistry classmates would play touch football as a break from research, classes, and experiments.

No matter what Rathmann did on the makeshift gridiron, the 6'-4" former Milwaukee high school basketball star would have been hard to miss. Encounters with scientific luminaries such as Einstein and J. Robert Oppenheimer were just as hard to ignore — and left a lasting impression on the man who would essentially create the biotechnology industry.

"There was a lot of magic," says Rathmann.

That magic must have rubbed off on him. In 1980 he founded Amgen, Inc. — today the world's largest independent biotechnology company — which in turn gave rise to the $22.3-billion U.S. biotechnology industry. Equated with inventors such as Henry Ford and Benjamin Franklin, Rathmann is treated within his field "with a reverence otherwise reserved for favorite teams and Mom," as one biotech industry writer put it.

"It's one thing to start a company and it's another to manage spectacular growth successfully, and he's demonstrated extraordinary talent," says Patrick McGeer *52, who once worked and played alongside Rathmann and is now professor emeritus of neurological research at the University of British Columbia.

Rathmann jokes, "I'm almost always viewed by business people as one of the best scientists they know and I'm almost always viewed by scientists as one of the best business people they know. Now the common denominator is that I'm not much of a scientist or a business man."

In truth, he's both. At Amgen, Rathmann's research and development experience, coupled with his charming smile and outgoing personality, helped turn the $18-million startup into a multi-billion operation. The company's focus on proteins and recombinant DNA technology — the transfer of a gene from one organism into another organism, literally DNA from different sources that have been recombined — led to the development of treatments such as Amgen's first product, Epogen. The red-blood cell stimulant, which supplements the supply of the naturally occurring substance produced by healthy kidneys called erythropoietin, is used by dialysis patients suffering from anemia. The company later used the same recombinant DNA technology to develop Neupogen, a white-blood cell stimulator that aids in fighting infections for people undergoing chemotherapy for cancer.

Combined, the two products had sales of nearly $3 billion in 1999. More important, says Rathmann, they helped people go on with their daily lives.

That human side of his work is something that touches Rathmann deeply. At Alumni Day in February, when he was awarded the James Madison Medal for distinguished graduate alumni, he delivered a speech in which he flipped to a slide of a woman on dialysis whose health improved dramatically after taking Epogen. The burly entrepreneur had to hold back tears as he told the audience about the patient's daughter, who thanked him for giving her mother back to her.

The enriched lives that come with successful treatments is the reason Rathmann has spoken out through the years about the new-drug approval process at the U.S. Food and Drug Administration. Currently, it can take up to 12 years and nearly $500 million to get a medication through the process and into the hands of patients.

"We ought to attempt to do better and be aware of the fact that the so-called safe path of rejection and delaying and preventing something from being tested seems safe because it means that nothing can go wrong," says Rathmann. "All you have to do is be exposed to a critically ill population, some members of which perish before a lifesaving drug is available, and you realize that, wow, if we could have saved six weeks or 10 weeks we could have saved that life. We could have changed that person's state of health by an enormous amount. I think that message has to be there all the time."

Rathmann, who now chairs the board at Hyseq in Sunnyvale, California, and at Seattle's ZymoGenetics, which recently went public, has watched the biotechnology field grow from about eight U.S. companies in 1980 to an estimated 1,273 in 2000, according to the Biotechnology Industry Organization.

Rathmann's personal fortune has grown along with the industry. He now travels in his own jet — a far cry from the $25 car Rathmann sold to his classmate McGeer when the pair parted ways at graduation. "That car would never have made it to Illinois," McGeer quips. That's where Rathmann and his wife, Joy, were headed after graduation, for a job at 3M. Rathmann worked at 3M for 21 years, where, among other accomplishments, he aided in the development of one of the company's signature products, Scotchgard.

He moved on to Litton Industries in 1972 and later to Abbott Laboratories, where he served as vice president of research and development before leaving to start Amgen.

Rathmann cofounded another biotech firm, ICOS, in 1990. The Washington-based company, which focuses on protein-based and small-molecule therapeutics, got off the ground with $30 million in initial funding, including $5 million from Microsoft magnate Bill Gates. Rathmann is credited with later wooing another round of funding from Gates by matching the billionaire's investment dollar-for-dollar.

Despite his success, Rathmann is not afraid to admit that he's had his share of failure. "I've been associated with some pretty big disappointments at some companies and I've watched some others have disasters, but you can come out whole after a short time and actually learn from the experience," he says. "There are very few things that can happen that are irreversibly damaging to your career, to your attitude, and to your ability to contribute."

His current contributions at Hyseq focus on research involving the sequencing of genes with an eye towards the development of treatments for cardiovascular diseases, cancer, and inflammatory and infectious diseases.

Rathmann is excited by the advances made in the sequencing of the human genome during the last few years, not only for the boost they give his industry, but for the potential they have to wipe out common diseases and conditions. Although he, like many others, initially thought the breakthroughs in genetic research would be a shortcut for success, Rathmann realizes there is a lot of research and testing ahead.

"The sequencing of the human genome last year was a positive jolt for the whole field of biotechnology. A lot of stocks benefited from more enthusiasm, more visibility, more general confidence that this was going to change how we do things — and it will — but it's going to be another few years before we see the real benefits. We've barely scratched the surface of what its impact is going to be," he explains. "It's kind of fun to watch it unfold."

Rathmann's excitement over research is what led him to Princeton. He earned his undergraduate degree in physical chemistry at Northwestern University in 1948 in just three years, and it was his senior adviser at Northwestern, Robert Burwell, Jr. *36, who suggested Princeton to him.

Once on campus, Rathmann says he was inspired by professors who gave their graduate students plenty of attention, including Charles Smyth '16 *17, Walter Kauzmann *40, and Hugh Stott Taylor, who headed the chemistry department from 1926 to 1951.

Smyth, his thesis adviser, served as Rathmann's mentor before the term was trendy, Rathmann says. "He was an inspiration because he was always right. He was very careful about facts and very thorough. If he took a sharp pencil to any paper you wrote, it was always vastly improved," he recalls.

Dean Taylor, who was later knighted by the Queen of England, was dedicated to keeping his students abreast of new developments, Rathmann says. "Dean Taylor almost invariably came to physical chemistry class with a recent issue of the Journal of Physical Chemistry under his arm and you just knew that he was anxious to keep us current and actively interested in the emerging science of the time," he remembers.

Rathmann still follows Taylor's example, staying on top of scientific advances, even though the chairman and CEO titles he has held could have shifted him away from it. "I think that a person who is strictly a manager and has lost interest in the science, or never really wanted to bother with it, really has severe limitations in leading new efforts on scientific frontiers," he says.

There are plenty of new efforts in biotechnology right now. With more than 350 biotech drug products and vaccines currently in clinical trials targeting more than 200 diseases, including various cancers, Alzheimer's disease, heart disease, diabetes, multiple sclerosis, AIDS, and arthritis, the future of the biotechnology industry looks bright, says Rathmann. But he says that a drop in investments is definitely taking a toll on many companies, which have been forced to lay people off or shut their doors altogether.

"We've gone through a longer period of time than I could remember of really tough times for financing, and in our system we believe it should be on your shoulders to raise money and get your job done," he says. "But I think the industry is still thriving. If you look at the pace of discovery, it has not slackened at all, even though there has been a lot of pressure on companies to make ends meet. The opportunities today, I feel, are as great as they ever were."

Argelio R. Dumenigo is PAW's associate editor.




The academics of terrorism

What Princeton professors are exploring in their research

By Melissa Harvis Renny '03

Even before the U.S. watched the twin towers fall, Princeton faculty members were working to stop terrorism around the globe.

The psychology department researched American right-wing extremists, from militias to white supremacists, trying to understand what drove them to violence. In the Woodrow Wilson School, professors worked to reduce the numbers of nuclear weapons in the U.S. and the Soviet Union so that these weapons would not fall into the wrong hands. Professors in the politics department studied terrorist organizations in Africa in relation to the U.S. embassy bombings of 1998, examining why certain countries were havens for terrorists.

Since the terrorist attacks on the U.S., Princeton faculty members have continued their work, applying it to the constant, current threat of terrorism in the U.S. Through papers, lectures, and legislation, Princeton University is helping to fight the war on terrorism.

"Terrorism depends on a viewpoint," said Jon Drummond, a graduate student in the social psychology department who is doing research on what motivates terrorists. "I try to look and see how the world appears through the eyes of the terrorists."

In order to help the government better understand the way that terrorists think, Drummond and Eldar Shafir, a professor of psychology and public affairs, attended an FBI conference in February on countering terrorism. At the conference, researchers, academic scholars, and personnel from justice, intelligence, and law enforcement agencies combined their knowledge on different aspects of terrorism and made recommendations to the FBI.

Drummond and Shafir also provided input to Senator Ron Wyden's (D-Ore.) Science and Technology Emergency Mobilization Act. This bill would create a science and technology equivalent to the National Guard, mobilizing academics and security experts to work together for U.S. security.

"I think that one of the lessons learned from September 11 is that just the process or just the intention to mobilize and bring to bear all applicable knowledge was probably lacking in many ways," Drummond said.

On campus, Drummond is working with John Darley, a professor of psychology and public affairs, on a theory that explains how people come to extreme views. Called "deviant legitimation," this theory asserts that terrorists move toward violence through a series of recognizable steps over time that leads them to lose faith in their establishment or government, and then to justify their use of violence. Drummond stressed that terrorists do not become violent overnight; rather it is a long, slow process full of thwarted efforts.

"You can't understand why this [September 11] happened until you see the way that the world looks through the eyes of those people," Drummond said.

Frederick Hitz '61, director of the Woodrow Wilson School's Project on International Intelligence, agrees that seeing the world through the eyes of the terrorists is crucial. The Inspector General of the CIA from 1990 through 1998, Hitz claims that before the CIA can change its rules of operation in regard to terrorism, it needs to understand terrorist cultures.

"What we really need to do is strengthen the cadre of analysts and intelligence collectors who work on these issues, because it seems to me there is not really much excuse for not knowing the threat that fundamentalist Islam and disgruntled citizens of the Middle East pose to the U.S. as the big target, and to the West in general, because of our prosperity and success and their poverty and hopelessness," he said.

In a recent article for the Harvard Journal of Law and Public Policy, Hitz assessed the pros and cons of using of spies to gather international information, giving the CIA law enforcement powers, allowing assassinations during peacetime, and recruiting journalists and academics as agents. Hitz stressed the need to preserve U.S. citizens' constitutional rights while protecting the country from terrorist threats.

The nuclear threat

Protecting the U.S. from terrorist threats is something Frank von Hippel, director of the Program in Science and Global Security at the Woodrow Wilson School, has done for years. As the former assistant director for national security in the White House Office of Science and Technology, and the chairman of the Federation of American Scientists, von Hippel holds a strong belief that nuclear weapons are intrinsically terrorist weapons.

"Nuclear weapons are weapons of terror whether countries own them or terrorists own them," he said.

In the days following the September 11 attack, von Hippel and his colleagues on the Russian American Nuclear Security Advisory Council (RANSAC) sent a letter to President Bush and Russian President Vladimir Putin, urging the leaders to prevent terrorists from gaining access to nuclear weapons. The letter called on the U.S. and Russia to revive underfunded programs that would eliminate nuclear materials left over from the cold war, because "inadequately secured nuclear material anywhere is a threat to all nations everywhere."

Von Hippel expressed specific concerns about Pakistan's stockpile of weapon-grade uranium in an article for the Journal of the Federation of American Scientists. Weapon-grade uranium is highly enriched uranium that, von Hippel said, educated terrorists could turn into a gun type nuclear explosive like the one the U,S, used on Hiroshima during World War II. In the article, Von Hippel made a series of recommendations that included increasing the security of fissile material, increasing transparency between countries about the size of their nuclear stockpiles, ending the production of Plutonium and highly enriched uranium (HEU), and disposing of excess stocks.

In order to make these recommendations realities, von Hippel and his colleagues worked with a series of NGOs (non-governmental organizations) to reverse the Bush administration's initial decision to cut funding for these programs. After September 11, when the administration received $40 billion supplemental to the fiscal budget, von Hippel and his colleagues lobbied so that a portion of this money would go to these key programs. Due to their efforts, the administration reevaluated the budget and allocated $250 million of the money toward programs with Russia that will reduce the threat of nuclear terrorism.

Possible protection

While this money will help programs in need, the struggle to insure safety is far from over. Von Hippel is currently working with graduate students in the Woodrow Wilson School on protection against weapons of mass destruction. One method of protection they are researching is potassium iodide pills. When a nuclear explosion occurs, radioactive iodide is inhaled and goes directly to the thyroid gland, increasing the chance of thyroid cancer. By saturating the thyroid with nonradioactive iodide — the potassium iodide pills — people can protect themselves from the health effects of a nuclear catastrophe.

Zia Mian, a colleague of von Hippel's in the Woodrow Wilson School, is examining the distribution of these potassium iodide pills in the areas around nuclear reactors as a part of his task force this semester. Mian's task force will examine the possible effects of terrorism on nuclear power plants, using three power plants in New Jersey for models.

"An attack on a nuclear power station can be potentially catastrophic," Mian said. "A nuclear power station is a fixed nuclear weapon of sorts."

While professors in the Woodrow Wilson School and the Psychology Department have been able to work for immediate change, other professors have had a more difficult time finding their place in the torrent of research on terrorism. Jeffrey Herbst '83, chair of the politics fepartment, claims that academics have had a particularly hard time focusing their work since September 11.

"I think academics are particularly challenged when the world changes like it did on September 11, and we want to be relevant to day-to-day controversies, but we have to stick to what I think is our comparative advantage, which is trying to put these things in larger context, and trying to think about more than what's going to happen in the next 48 or 72 hours," Herbst said.

Herbst will put the attacks in a larger context in a conference he is planning for late September that will focus on the heterogeneity of views in the Islamic world. He sees the conference as a platform to expose the U.S. to ideas in the Muslim world that may not be widely known.

"The basic idea is that a lot of people in Muslim countries have all kinds of notions about democracy, about terrorism and the like, and they don't have a very big voice in these countries because the governments are authoritarian and because the fundamentalists in many cases, have crowded them out or intimidated them," he said.

A year after the terrorist attacks, this conference will provide testimony to Princeton faculty's work toward a greater understanding of Islamic cultures, work that, they hope, will prevent terrorism from occurring in the future.