Building an Innovation Zone in Austin

By SUSAN LAHEY
Reporter with Silicon Hills News

Sen. Kirk Watson speaking at the Austin Chamber's Innovation Summit, photo by Susan Lahey

Sen. Kirk Watson speaking at the Austin Chamber’s Innovation Summit, photo by Susan Lahey

Austin is poised to become a global center of innovation, especially in the field of life sciences and medical research, but there are some big hurdles to overcome and potential threats that could knock the city off its trajectory, if it’s not careful.

That was the bottom line of the Austin Chamber of Commerce’s Austin Innovation Economy lunch Thursday at the Hyatt.

More than 350 people attended the event which looked at Austin’s plans for an Innovation Zone proposed to be from MLK Blvd. south to the river and from San Jacinto to I-35, according to Texas Sen. Kirk Watson. Watson has been named as incoming chair of the advisory committee for the project. The centerpiece of the project is the Dell Medical School at the University of Texas but Watson said the innovation zone will not only coordinate with Central Health (the county’s public healthcare district) and Seton but will also coalesce around art, software development, media and other elements of the community.

Dr. Clay Johnston, inaugural dean of the Dell Medical School at the Austin Chamber's Innovation Summit, photo by Susan Lahey

Dr. Clay Johnston, inaugural dean of the Dell Medical School at the Austin Chamber’s Innovation Summit, photo by Susan Lahey

At present, according to Dr. Clay Johnston, inaugural dean of the Dell Medical School, the medical field is leagues behind where it should be in terms of innovation.

“Doctors still use pagers,” he pointed out, “one of the least effective ways to communicate.”

The U.S. has one of the most expensive medical systems in the world, but life expectancy has only risen by less than a decade since the 1960s. In terms of actual care, he said, we’re comparable to Cuba.

The reason the medical field is so far behind is that the financial model for medical care depends on people being sick, on multiple procedures and doctor visits. Innovation creates efficiency, eliminating redundancy and therefore causing a loss of income.

There’s a built-in disincentive to innovate which means it’s time for a revolution in health care. One of the goals of the innovation zone is to make research through the University of Texas Dell Medical School and make it available for entrepreneurs to create that innovation revolution. The innovation center will create better access for collaboration, clinical trials and other advantages of critical mass in a medical practice, university and research setting.

Another speaker, Thomas G. Osha, managing director of innovation and economic development with Wexford Science and Technology which is a real estate investment company that helps develop research and innovation centers, said Austin has some distinct advantages as well as risks.

Much of the funding for medical research, Osha said, has come from the National Institutes of Health and NIH funding is being significantly reduced. At the same time, research and development costs are skyrocketing, making medical research more exclusive. In addition, he said, a lot of people believe we’re creeping up on a new tech bubble “We’ve drifted from the lean startup model and are chasing ever sillier return models.” Moreover, he said, Austin does not have the talent pool yet to support the opportunity in life sciences and medical research.

Each of those situations, he said, presents an opportunity for Austin to differentiate itself.

“You have phenomenal things happening in music, art, culture, the innovation zone should be the thing that stitches all of those things together.” Austin needs to approach the innovation zone in a way that’s exclusively Austin, he said, including “open, thoughtful, creative, inclusive.” Other medical research and life sciences organizations are replacing NIH money with Department of Defense and Homeland Security money, he said. Startups in this space often require an investment of at least $10 million, which generally means the company gets pulled to one of the coasts where there is not only funding but access to institutions and opportunities for clinical trials. The creation of the innovation center, combined with the attractive Austin lifestyle might be able to counter that. People talk a lot about Boulder The lifestyle in Austin, plus the power of proximity can create an advantage that Silicon Valley lacks and Cambridge, Massachusetts is “losing a little bit,” Osha said.

“People always talk about Boulder and how they have five strong clusters. But those clusters never talk to each other. Cross pollination is the way to move forward.”

Comments

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  1. […] Constructing an Innovation Zone in Austin Greater than 350 individuals attended the occasion which checked out Austin's plans for an Innovation Zone proposed to be from MLK Blvd. south to the river and from San Jacinto to I-35, in accordance with Texas Sen. Kirk Watson. Watson has been named as incoming chair of … Learn extra on Silicon Hills News […]

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