Vision unrealized? University of Minnesota faces new reality

Dr. Frank Cerra has hitched his wagon to outgoing University of Minnesota president Robert Bruininks.

Cerra, medical school dean and head of the school’s Academic Health Center, is retiring at the end of the year partly because Bruininks is doing the same.

“My good fried Bob Bruininks is stepping down,” Cerra said in a previous interview with MedCity News. “I agreed to stay as long as he did. He’s moving on, so I think it’s time to move on.”

It’s just as well. Together, the two men had sought to remake the school into a top research university and an economic engine for Minnesota. But as Bruin-erra (a bit of stretch? Sorry.) prepare to exit, their vision is in doubt.

The school already was facing shrinking state aid. But with Republicans unexpectedly set to seize control of the legislature and possibly the governor’s office —  promising swift and far reaching budget cuts — it’s logical to assume the university’s research ambitions will be, at best, placed on hold if not severely diminished.

There are plenty of targets:

Biomedical Discovery District — The state already has approved a bond to help pay for the $292 million district. A lot of it has been built, so I’m not suggesting the district will cease to exist. However, there’s more to the district than buildings. The point of building world-class research facilities was to attract world-class research faculty. And that takes money.

Furthermore, developers behind the planned adjacent Minnesota Science Park likely will need state money for infrastructure improvements, including moving commercial railroad tracks out of the way. Good luck.

The Minnesota Partnership for Biotechnology and Medical Genomics — The highly touted research partnership between the university and Mayo Clinic lives hand-to-mouth on state dollars, and those dollars are harder to find.

Facing deep state cuts in 2008, the university cut nearly 40 percent from the partnership’s annual $8 million budget. Last year, the university cut $300,000 from the partnership, this time with Mayo’s blessing, angering lawmakers who had fought to protect the money.

Cerra and Dr. Robert Rizza, Mayo executive dean for research, continue to argue that the partnership has been an overwhelming success. Budget-minded Republicans might feel otherwise.

In its seven years, the partnership has yielded only one startup — not exactly what lawmakers had in mind when they first approved the initiative. True, a lot of that research is cutting-edge stuff that requires a long time line. But try selling patience to politicians whose strength has never been long-term thinking.

Which brings us to…

Decade of Discovery –– Without state aid, the 10-year initiative led by the university and Mayo Clinic to combat and ultimately cure diabetes easily could become the Lost Decade. Of the estimated $250 million-to-$350 million needed to fund the initiative, about $26 million would come from state coffers.

At this point, holding on to that will be tough. Asking for an additional $26 million over time is looking more unrealistic.

Last month, Cerra expressed confidence the university and health system could get the money. “The proof of concept is there,” he said. “We have legislators who made the investment in the [university/Mayo] partnership.”

Then again, that was BEFORE the November elections.

Democratic Rep. Kim Norton, a  key supporter and member of the House Committee on Higher Education and Workforce Development, won her reelection bid but will be operating in the minority. Her Democratic colleague and fellow partnership supporter, Rep. Andy Welti, was defeated.

Democratic Sen. Kathy Saltzman also lost to Republican newcomer, Ted Lillie. With so much turnover, Mayo and the university will be hard-pressed to make their case to new legislators who weren’t around in 2003 when the partnership was born.

The school’s state financial woes also hurt its ability to attract national funding. Historically, universities with weaker state support also see their federal research money dwindle, said Tim Mulcahy, the university’s vice president of research.

In order to win grants from organizations like the National Institutes of Health (NIH), the school needs to put forward high-quality research projects to vie for a limited pool of federal dollars, he said.

In other words, you need money to put yourself in the position to win more money.

Last year, the school’s main Twin Cities campus won $241 million in NIH money, down 6.5 percent from 2007, according to NIH statistics.

At 2 percent a year, the NIH budget has hardly been growing, meaning the competition for grants is becoming even more intense, Mulcahy said. (Assuming of course, Congress doesn’t whack the NIH budget, as well).

“It’s going to take its toll in the long run,” Mulcahy said.

Compounding the problem: Minnesota’s congressional delegation historically has not done a good job in winning federal research money for their districts, said Frank Jaskulke, the top government affairs official for LifeScience Alley.

Not that anyone in Washington, D.C.,  is openly supporting earmarks right now. The one Minnesota congressman who was a master of winning earmarks, Rep. Jim Oberstar, chair of the House Transportation Committee, narrowly lost his seat.

And politically, the university has not enjoyed many friends in St. Paul. Everyone from Republican Gov. Tim Pawlenty to Democratic Rep. Tim Mahoney has taken shots at the school.

I suspect the university won’t do much better when the Republicans call the shots in the legislature. At the risk of making a broad generalization, conservatives typically see universities as liberal bastions of elite intellectuals — not exactly the Republican voting block.

Incoming Republican Sen. Lillie, for example, accused the $60 million angel investment tax credit — which won overwhelming bipartisan support — of benefiting only “a few targeted businesses near the University of Minnesota.”

Here’s the main problem: While the university has arguably succeeded in establishing itself as a major research institution, it has not fared as well in economic development. Winning grants and building research facilities are fine, but they don’t win a whole lot of political support.

Know what does?

Creating companies, industries and jobs. And here’s where the school’s record is a decidedly modest bag. While the school’s Office for Technology Commercialization (OTC) has made progress over the years, it hasn’t advanced nearly fast enough to quiet the haters. And it may never.

Perhaps it’s time for the university to fundamentally rethink its relationship with business, said Peter Bianco, director of lifescience business development at Nilan Johnson Lewis who’s leading efforts to create the Minnesota Science Park.

If the school no longer is able to count on public support, it must pursue private money and expertise, Bianco said.

The university always has had an ambiguous relationship with business: on the one hand embracing commercialization, but on the other, never quite making it a top priority.

Finding professors with a natural instinct for capitalism is like trying to remember the last time the Golden Gophers football team won a football game. You just come up blank.

“The U doesn’t have a lot of entrepreneurs,” said Mike Selzer, a former medical device executive and CEO of XO Thermix Medical, a university-bred startup. “There are only a select few who get it.

“It’s going to be better,” he said. “You will have a lot of complaining that nothing is happening. All it takes is to get people up to speed.”

The university, however, may not have the luxury of time. Cerra acknowledges the new reality. The school must not only do more with less but also reshuffle its priorities, he said.

“There’s no question that politicians use the U as a whipping post to make a political point,” Cerra said. “But hey, there are a bunch of things that we haven’t done well with. We must prove we can work together and get excellent returns for state money.”

But that’s a job neither Cerra nor Bruininks will have to worry about anymore.