Like many biotech companies, XenoTech had the usual beginnings of university-rooted research. However, what's not so usual is the fact that Dr. Andrew Parkinson not only managed to sustain the business but, in fact, grow operations to impressive proportions in less than a decade.

It's no secret that many biotech start-up companies will not survive. By some estimates, only one in four start-ups will make it in the business world. It's simply the nature of the beast.

However, every so often, a scientist can truly witness the true fruits of his or her labor

in the evolution of new commercially viable pro-ducts that ultimately lead to improving human lives.

Incubators can be instrumental in helping these young companies reach new levels of success.

How a success story was launched

Dr. Parkinson's research began at the University of Kansas Medical Center in 1983 when he was a professor of pharmacology and toxicology. Since his Ph.D. student days, he has been involved in research on how the liver metabolizes - or breaks down - drugs and other chemicals.

His research led to the development of some pre-clinical tests, based on in vitro experiments with non-transplantable human liver, to evaluate the safety of drugs under development by Big Pharma worldwide.

Eventually, Dr. Parkinson took his research one step higher and founded XenoTech in 1994.

"We set up shop in the Biotechnology Development Building, which is KUMC's business incubator," said Parkinson. "After a year or so, we occupied the entire incubator - 6,500 square feet - which is a combination of laboratory and office space."

XenoTech continued to provide products and contract research services to optimize the discovery, development and approval of drugs, food additives, nutraceuticals, agrochemicals, cosmetics and fragrances.

In essence, the company offers outsourced lab services that help pharmaceutical companies figure out which drug compounds should be thrown out and which ones should undergo continued testing. The research is an instrumental segment in the early part of the drug development process.

Just two months ago, XenoTech said good-bye to KUMC's incubator and moved to its own new 20,000 square foot lab/office facility in Lenexa in the Greater Kansas City Metro.

A nurturing environment

Business incubators - regardless of the industry - are heralded for the various forms of help and guidance that they can provide to young companies.

It is quite common for incubators to be located on university property or in the nearby vicinity. The relationship is a symbiotic one in many respects for the university and incubator business involved.

"When XenoTech was founded in 1994, I was still a faculty member at KUMC," said Parkinson. "Therefore, the proximity of the incubator to my laboratories and office at KUMC allowed me to wear two proverbial hats at the same time.

"The major advantage of moving into the business incubator is that XenoTech had access to affordable laboratory space where it could conduct research in compliance with the Good Laboratory Practice regulations - something that is difficult to achieve in an academic setting," said Parkinson.

Thomas Noffsinger, Ph.D., executive director of the Kansas University Medical Center Research Institute, outlined several other benefits of an incubator.

"You have to be connected to a major computer system, for one thing," said Noffsinger. "Sometimes scientists need to try a drug out on animals, and we have an animal-testing facility next door to the incubator, with space available on a rental basis."

He went on to say that the incubator offers biosafety instruction, as well as biomedical waste services.

"No young company can afford that," said Noffsinger.

University incubators also provide proximity to the human factor - scientists - and generally should offer the basics necessary for any business establishment. Things like accounting services, a receptionist, a conference room, and telephone, fax and computer connectivity.

While an incubator may be a great route to the future for a start-up company, not just anyone can establish operations in an incubator.

Dr. Noffsinger said to obtain space in KUMC's incubator, there is an extensive selection process for businesses to go through before getting accepted. A variety of important questions must be answered.

Does the new business look promising? Does it have a sound business plan? What kind of history does the company have? And what is its potential to pay its bills as time goes on?

Generally speaking, incubators are designed to be a temporary home for two to three years for companies just starting out.

They can minimize overhead and front-end costs, provide office and lab space, and offer technology infrastructure necessary for conducting research. Additionally, the incubator staff is on-hand to give business advice and provide important information on regulations.

For BioPhan Technologies, Inc., locating in the Lennox Tech Enterprise Center of High Tech Rochester (TEC) in New York has proven extremely advantageous.

"Our decision to locate at TEC has paid off many times over," said Mike Weiner, CEO of BioPhan Technologies, Inc. "The proximity to other high-tech people and executives has enabled us to find valuable business opportunities in which we have taken an interest."

Forging into the future

While just 20 years ago, business incubators were virtually unheard of, there are now hundreds of them in various locations around the world.

As for XenoTech's future, Dr. Parkinson says the plan is simple.

"We have plans to expand and improve our existing product line and services to take advantage of increased demand (which is growing around 30 percent a year)," he said. "We feel it will not be long before we will need to make plans to build a second facility adjacent to our current facility. So it will be back to the drawing board with our architects."

A Sampling of Biotech and High-Tech Incubators

The University of Florida's Sid Martin Biotechnology Development Institute - Alachua, Fla.

Biosquare - developed by Boston University and Boston Medical Center

John P. Robarts Research Institute - London, Ontario, Canada

Nidus Center for Scientific Enterprise - St. Louis, Mo.

Maggie L. Walker Business & Technology Center - Richmond, Va.

Ottawa Biotechnology Incubation Center - Ottawa, Ontario, Canada

University of Kansas' Biotechnology Development Building - Kansas City, Mo.

Virginia Biotechnology Center - Richmond, Va.

BioHouston Incubator - Houston, Texas

Lennox Tech Enterprise Center of High Tech Rochester (TEC) - Rochester, N.Y.

Evanston Business & Technology Center - Evanston, Illinois