Venturing Into a New Enterprise.

Former Amgen chief Gordon Binder starts a new Chapter

It's tough to get the rapt attention of a jaded bunch of venture capitalists and biotech entrepreneurs. A lot of them have heard it all before.

But in a hall at UCLA a few weeks ago, former Amgen CEO and Chairman Gordon Binder had them hanging on his every word, as he spoke about the future of biotech, and perhaps more importantly, himself.

After all, it's not exactly a secret that the recently retired executive of the world's largest biotech company has more than $100 million worth of stock options.

With that sizable war chest, Binder is back at work with Larry Souza, Amgen's former research director -- this time building a VC firm.

"It's true, as some of my friends say, I am flunking retirement," says Binder, eliciting chuckles from the crowd. "(But) I think the future of biotech is strong, and that is why Larry and I are going to do this enterprise."

For a man who cut his teeth as a financial manager, first with Ford Motor Co. and later with System Development Corp., Binder has in a sense come full circle. It's about money again, and more than a few in the Los Angeles biotech world are hoping it will land their way.

The 65-year-old Binder is a man of great reserve and dignity, so nobody will say this to his face, though they whisper it behind his back: there's irony that Binder now wants to morph into a venture capitalist.

While he's credited with growing Thousand Oaks-based Amgen during the past dozen years into a giant with a market cap approaching $100 billion, he's also faulted for doing little to nurture the L.A. area's biotech community, which now lags behind the Bay Area, Boston and even San Diego.

But Binder is unrepentant, saying he and Amgen had a more important agenda on his crowded plate.

"We promoted the U.S. biotech industry," he says. "I spent the time in Washington. I put in a lot more time there than most CEOs do."

Indeed, even today Binder is on a 10-hour weekly retainer at Amgen, lobbying in Washington, D.C. for Medicare prescription drug coverage.

He has so far been reluctant to talk much about his new VC endeavor, especially the size of its initial fund, since he and Souza are still raising money. But he has hinted here and there where he's headed.

He does not intend to move from the Holmby Hills home that he shares with his wife, Adele. And, while he agrees that VCs should concentrate on companies in their own backyard, he does not plan to limit himself to the Los Angeles area. He says that California, as well as the Massachusetts Institute of Technology, will be his firm's focus.

Binder sits on the MIT board, and Amgen, under his tenure, has developed a strong relationship with the Cambridge technology powerhouse, supporting various scientists' projects there. Amgen is actually finishing up construction of an eight-story building on the edge of the MIT campus to have a presence in the area.

Even so, Souza, who retired from Amgen a few months prior to Binder, said that his interest in starting the VC firm was piqued when he began receiving calls from members of the Los Angeles-area biotech community.

"I had people contacting me," says Souza, who's only 47. "There was some interest in the L.A. community."

Binder also sits on the board of MIT's rival Caltech, and says, "You can mentor and help the companies you invest in if they are close."

So there's no doubt that more than a few dollars should flow into Los Angeles from Binder and Souza's fund.

William Goddard, a highly respected chemistry and physics professor at Caltech, says that Binder has the capacity to find and nurture companies with the potential to rival Amgen in size and prestige, potentially fomenting the growth of a thriving biotech community.

"He is capable of bridging the gap between money and technology," said Goddard, who sits on the board of Bionomix, a Caltech spinoff that is developing computerized tools to determine the structure and function of proteins. "I can come out and say I will create a billion-dollar venture fund, but am I really in a position to do something good with that billion dollars?"

Arthur Klausner, a general partner at Domaine Associates, a venture capital firm with offices in Laguna Nigel, said that the ball is really in Binder's court. He could drop $10 million to $20 million in seed money, or he could raise a quarter billion dollars and focus a good portion of it on the region.

"He's got a Rolodex that is second to none, so I would expect he would be able to raise money," Klausner said. "If he wants to raise a significant amount of money, that would be great."

The timing may be critical, with the recent completion of the mapping of the human genome and talk of creating a biotechnology center in Pasadena with a focus on bioinformatics, which combines the fields of biotechnology and computer science. And VC funding will be at a premium as the country's biotech centers race to capitalize on new advances wrung from the human genome project.

Binder acknowledges this much: He is interested in very young startups where he can lend the expertise he has gained over four decades in business, and in particular at Amgen.

"Helping and nurturing companies so they would be a better partner for Amgen is something I spent real time on, so that part is going to be very much the same," he says.

He also says he's open to financing a broad spectrum of companies, as long as they are medical and technology-based.

Longtime Amgen director Steve Lazarus, a managing partner at Chicago-based venture capital firm ARCH Venture Partners, said that he has had many a conversation with Binder on the subject.