Texas Med Center Playing Catch-Up On Commercialization
Despite being the largest medical complex in the world, Houston’s Texas Medical Center lags behind other healthcare strongholds in commercialization. In medical research hubs like Boston, every $5 of research spending produces $1 of commercialization, San Francisco is even better at a 3-to-1 ratio. At the TMC, it takes $24 to produce $1 of commercialization. To compete, the TMC will need to do better.
“If you look at the MITs and Stanfords of the world, the paradigm is no longer publish or perish, it’s now commercialize or perish,” Texas Medical Center Operating Officer and Executive Vice President Shawn Cloonan said at Bisnow’s National Healthcare South event Tuesday.
The Texas Medical Center handles more than 10 million patients and 750,00 emergency room visits every year. A surgery begins there every three minutes. Historically, the TMC has used its 50M SF of developed medical space to focus on treatment, not innovation. That is changing.
"Five years ago, and for the first time in our 70-year history, all TMC CEOs and executive leadership came together to form a strategic plan,” Texas Medical Center President and CEO Bill McKeon said in a recent press release.
The Texas Medical Center's big push for commercialization centers around TMC3. Five academic institutions are planned to be involved with the project, which will feature a large central building surrounded by four other buildings offering research and lab space. The timeline and cost of the project have not been announced, but Texas A&M and Baylor already have permission to participate and the University of Texas is expected to sign on soon.
A recent study found that TMC3 could have a $5.2B impact on the city of Houston.
“Very imminently we have a major announcement on that project, it’s too important to this city,” Cloonan said. “The bottom line is, we are building TMC3 to be a honeypot that attracts industry. We need something iconic."
“We’re in desperate need of research space,” Baylor College of Medicine Chief Business Officer Kimberly Cotner David said. “We’re landlocked in the Medical Center, that’ll be our next foray into a building.”
Research dollars are key to pursuing commercialization, and funding the right idea could lead to thousands of square feet of development as enterprises expand. Baylor is the top recipient of National Institutes of Health grants in the Texas Medical Center, accounting for roughly 25% of the area's $2B in federal research grants. Statewide, Texas has committed $3B in funding for cancer research and prevention as part of the Cancer Prevention and Research Institute of Texas. Houston institutions such as The University of Houston, UT MD Anderson Center, Baylor College of Medicine and Rice have received a large portion of the $1.9B in grants to date.
“The economics of research funding isn’t well understood,” David said. “As hard as it is, it’s a very important part.”
Incubator space is also springing up in the TMC, helping bridge the gap from research to product. Last year Johnson & Johnson opened the 26K SF Center for Device Innovation. In 2016, JLABS @ TMC opened as a 34K SF co-working/incubator space. TMCx+, an accelerator, opened its 24K SF space in 2015, and TMCx opened in October 2014. The roughly 40K SF TMCxi, an area aimed at attracting tech leaders and venture capitalists, will open in June. All the spaces are in the larger 100K SF Innovation Institute at the TMC.
TMC leadership is betting that the Texas Medical Center's $3B in new projects and 100,000-plus healthcare professionals will be enough to boost it up to the level of other prominent healthcare hubs like Boston and San Francisco.
“We'are asking people to move across the country. I’ll take that bet. I’ll bet on Texas,” Cloonan said.