The entrepreneur who created Memphis' first biotech business is now helping a new generation of inventors.
Preston Dorsett three weeks ago was named executive in residence at Memphis Bioworks Foundation, but has quickly gravitated to Innova, a business development project that grew out of Bioworks. Innova identifies promising technology and helps scientists turn their ideas into new local businesses.
Dorsett blazed that path himself 26 years ago, when he took a novel idea he developed at the University of Tennessee Health Science Center and turned it into Viral Antigens, a Memphis company with global reach in diagnosing disease in humans and livestock.
"When we started Viral Antigens, I thought the most difficult problems would be technical; coming out of a lab you expect that," Dorsett said. "Instead it was all the other things you don't know about like human resources, compliance and the rest of it that gave us the problems. If I can work with entrepreneurs coming out of the university, I can suggest things for them to look at and consider that they may never think of."
Dorsett and his partners sold Viral Antigens in 2000 for $9.6 million up front and annual payments for six years. He remained president until last July; after a few months of retirement Dorsett was restless and called his friend Steve Bares, president of Bioworks.
In 1982 Dorsett was the classic would-be-entrepreneur, said Ken Woody, president of Innova. Dorsett had a completely original idea that would change the world of science and medicine, but lacked the business and financial knowledge to get it to market. Those hard lessons already are making a difference at Innova, Woody said, for potential companies and Woody himself.
"The more that Steve and Preston were talking, he thought that Innova was pretty cool," Woody said. "I got him looking at a couple of deals that are in his sweet spot - biotesting - and he asked questions I never would have thought of."
Innova was structured after Bares studied a number of business incubators and found them all lacking. His goal is to create new employers that particularly can prosper with Memphis' assets, including the local orthopedic and device industry, and, thanks to FedEx, just-in-time logistics. Bares said he prefers to call Innova a "business accelerator."
Woody comes from a background in medical devices. Prior to joining Bioworks he was senior vice president of global sales for Smith & Nephew Orthopaedics. Since taking over as first president of Innova in December, he already has evaluated 37 proposals.
Dorsett, by contrast, comes from a background in biotechnology and pharmaceuticals, bringing an intimate knowledge of U.S. Food and Drug Administration issues on the pharmaceutical side, and how those products make it to market.
Woody quickly put Dorsett's office next to his own and they now operate like a wrestling tag team.
"He's helping with deal evaluation as I meet with founders in the startup phase," Woody said. "I got him involved in three deals and one looked really good. Preston agreed, but picked out four areas to look at closely. It saved me time and money and gave me an education; I would have to go out and hire experts to do that."
Another deal Woody felt was questionable did not fit his criteria, which includes being a good fit for Memphis and having a clear market potential.
"Preston helped me talk to the experts and we came back feeling that it's twice as good as anyone estimated," Woody said. "It's fascinating the things people know, and who they know."
Though Dorsett has gravitated to Innova, he still functions as a part-time sounding board for Bares, providing a unique point of view.
Not first time around the block
Dorsett's major contribution to medicine was a technique for making stupid-proof diagnostic assays, which are test kits that are ubiquitous in human and veterinary medicine today, but were revolutionary a quarter century ago. That was when doctors and veterinarians diagnosed disease with a best guess, based on symptoms and experience.
Actual tests could take 10 days, had to be performed by an expert in a culture lab and suffered a high failure rate. Worst of all, results typically were available only after the patient recovered, or died.
Dorsett's technology was a way to attach virus proteins to latex. Place a drop of infected blood on the material and antibodies in the blood would glom together with the proteins and form visible clumps. The answer is available in minutes.
The first was for Rubella. Each new test by Viral Antigens had to run the federal gauntlet, giving Dorsett a long and deep experience with the approval process.
The world of biologics
Dorsett also brings another critical experience, Woody said. He built a GMP (Good Manufacturing Process) in 2002.
GMP means the lab meets stringent FDA rules for cleanliness and pathogen isolation. The $2.5 million, 2,500-square-foot GMP adjacent to Viral Antigens is a contract manufacturer.
When a scientist reaches a threshold in his or her work, it's necessary to run a batch under GMP standards for testing and evaluation. But labs can be expensive, and with a nationwide explosion in biological research, it's hard to find time in a commercial contractor. Some scientists can wait a year for a slot; so critical is a GMP to advancing science that St. Jude Children's Research Hospital in 1991 launched a $37 million, 65,000-square-foot GMP so its researchers don't have to wait in line.
"The GMP at Viral Antigens took a long time to open, and to get the queue filled with projects," Dorsett said. "It introduced me into the world of biologics and the FDA. It gave me an intense and great experience with FDA regulations."
Dorsett has yet to take advantage of one perk of being at Bioworks: Natika Calhoun was the lab manager at Viral Antigens during the GMP project. She went on to launch LifeBlood Biological Services, which develops new, profitable products from blood that used to be thrown away.
Today, Calhoun owns LifeCyte Inc., which provides lab and validation services to the same sort of entrepreneurs that Bioworks and Innova nurture.
LifeCyte is also in the Bioworks Building at 20 S. Dudley St., just one floor above Dorsett.
"We've traded e-mail, but we're both so busy we haven't had time to visit yet," he said.