Inova CEO Knox Singleton and UVa President Teresa Sullivan sign partnership deal. Photo credit: Washington Business Journal
Inova CEO Knox Singleton and UVa President Teresa Sullivan sign partnership deal. Photo credit: Washington Business Journal

by James A. Bacon

The University of Virginia and Inova Health System have joined forces in a $112 million partnership to launch a medical campus and a biomedical research initiative in Fairfax County. The partnership has three main components:

  • A cancer research partnership between the Inova Schar Cancer Institute and UVa. Cancer Center. The aspiration is to achieve designation by the National Cancer Institute as a Comprehensive Cancer Center, which would enhance the center’s prestige and open new avenues for research funding.
  • A regional campus of the U.Va. School of Medicine, which will enable UVa. medical students to complete clerkships and post-clerkship education at Inova hospitals in Northern Virginia.
  • A research partnership to develop the Global Genomics and Bioinformatics Research Center at The Inova Center for Personalized Health.

As part of the expanded relationship, UVa’s Darden School of Business will lead a business accelerator to speed the commercialization of medical research and the incubation of companies with innovative products.

Most of the activities will take place at the Inova Center for Personalized Health on the former Exxon Mobil campus located near Inova Fairfax Hospital, Inova’s flagship hospital.

“U.Va. is one of the most prestigious research universities in the country, and Inova is one of the largest, most successful health-care systems,” Knox Singleton, CEO, Inova Health System, said in a prepared statement. “This partnership leverages the complementary strengths of two institutions committed to providing the most advanced treatments and prevention strategies to the communities we serve.”

Twenty-eight million in funding will come from the Commonwealth of Virginia. Inova will raise another $56 million, and UVa will chip in $28 million. Dr. Richard Shannon, executive vice president for health affairs at UVa, told the Daily Progress that he did not know where UVa’s share will come from, although one possible source is the university’s new Strategic Investment Fund, which is expected to throw off about $100 million annually.

Meanwhile, in western Virginia… Virginia Tech plans to absorb the Virginia Tech Carilion School of Medicine in Roanoke within the next two years, according to Virginia Business. “Our school is a research-intensive medical school and to be able to identify that research you have to be part of the university. That was one of the drivers,” says Nancy Howell Agee, Carilion Clinic’s president and CEO.

Bacon’s bottom line: I am ambivalent about these developments. On the positive side, the UVa-Inova and Tech-Carilion partnerships could create the critical mass it takes to break into the biomedical big leagues. Both are targeting emerging fields of medicine in which they don’t have to compete against entrenched biomedical powerhouses. The potential exists to create important new drivers of economic growth in Northern Virginia and the Roanoke-Blacksburg regions, giving new impetus to Virginia’s lethargic economy.

Whether these partnerships can construct the research-clinical-entrepreneurial ecosystems it takes to be successful remains to be seen. Northern Virginia has a respectable (though modest by Silicon Valley standards) angel financing/venture capital sector which should be capable of supporting the commercialization of new technologies. Proximity to the National Institutes of Health in Bethesda, Md., is a bonus for snagging research dollars. The Roanoke-Blacksburg area, which lacks these advantages, is more problematic.

What concerns me is how these initiatives are arising from large, lumbering not-for-profit organizations — health systems and universities — that are raising their capital not from capital markets, where their deals will be subjected to close scrutiny by investors, but from their own internal resources.

Unlike private enterprises, universities and hospitals don’t pay income taxes and they don’t pay dividends. Not-for-profit hospitals extract “surplus” revenues (what for-profit enterprises would call profit) by charging patients more than they need to. Universities extract wealth by over-charging students. In other words, it can be argued that that Inova, Carilion, UVa and Virginia Tech are building their research empires on the backs of patients and students with little accountability to the public. Hospital and university boards, far from representing the interests of patients and students, are rah-rah cheerleaders for institutional growth.

Business communities and the political establishment are cheering these initiatives as well. The lack of public debate is appalling.

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10 responses to “UVa, Inova Partner in Research Initiative”

  1. LarrytheG Avatar

    not to draw any false equivalences…

    but a lot of Medical these days is powered by Medicare dollars and dollars from employer-provided insurance which is also govt subsidized and incentivized.

    autonomous vehicles was initially incubated by DARPA – remember the DARPA Grand Challenge?

    ditto drones – ditto cells phones navigation and location functionality that totally depends on the 100% govt funded GPS satellite network.

    truth is, it’s the govt that funds a lot of the research at Higher Ed… anyhow as well as many of the core technologies that underpin private seetor entreprenurship.

    If we could convert MedicAid to a managed care business model that relies on electronic medical records and distance tele- medicine – it could actually pay for itself in reduced entitlement costs – who knows!

    And in Va.. it’s the govt that largely powers Nothern Va and Hampton Roads ergo the lions share of the economy in Va anyhow.

    I think we can stand a little more faux private sector in the Med/tech fields at UVA and VaTech.

    at least it’s diversifying!!!

  2. With respect to VT’s 100% intern match rate and ~110 applicants for each med school slot it looks like it must at least be GOING in the right direction.

    My my my how the old school has changed since I finished in ’50.

  3. TooManyTaxes Avatar

    This requires more thinking, but it clearly makes more sense to do major research in Fairfax County than it does in Charlottesville. The economic impact on NoVA and, hence, the entire state will likely be much larger.

  4. LarrytheG Avatar

    I’ll be the contrarian again. I think Virginia is too geographically reliant and worse too reliant on military/DOD Federal Govt spending.

    I think Virginia needs to diversify it’s economic development both geographically – and revenue sources…

    we should be doing what North Carolina and other states have been doing and try to start new and grow existing economic development – especially in regions that have lost their industrial base – coal, furniture, textiles and in the age of the internet – leverage that to feed off of Universities that already have core academic and technology programs oriented to 21st century commerce.

    Link the Universities with Community Colleges – AND with Regional Medical Centers and other employers who need more well-qualified employees who are equipped with the academic and knowledge skills needed to produce goods and services that are globally competitive but also benefit Virginia and it’s regions in need of more economic development.

    NoVa and Hampton don’t need “more” .. “help”… they have the infrastructure and workforce to attract economic development already – and truth be known – and TMT should admit this – more jobs in NoVa will further exasperate the transportation nightmare that in turn drives people to spraw in the outer rings – making transportation even more of a nightmare…

    Why not more places like Charlottesville and Blacksburg – growing vibrantly with an abundance of affordable housing in the core urban areas and more potential to add to it without forcing mega-commutes of 40-50 miles and worse?

    1. TooManyTaxes Avatar

      Larry, I don’t disagree on the traffic impact. My point is only operating this new “business” in NoVA will likely have a greater impact economically than if it were operated in Charlottesville, Blacksburg, or even Richmond. I think the multiplier effect would be bigger here (NoVA).

  5. LarrytheG Avatar

    whatever multiplier effect you’d get – would it be worth the increased traffic?

    I think the other parts of Va need economic development more than NoVa/Hampton does if we are going to not expect NoVa/Hampton to subsidize them – their unemployment and their schools.

    can’t have it both ways…

    we really do need to try to get other parts of Virginia to start creating jobs… for the folks that live there… unless we just want to continue to subsidize them…

    1. TooManyTaxes Avatar

      “whatever multiplier effect you’d get – would it be worth the increased traffic?”

      An excellent question. I don’t know the answer. The development at Tysons is producing both additional real estate tax revenues and increasingly bad traffic congestion. I’ve asked a Supervisor when the County expects growth at Tysons to enable the County to lower real estate tax rates. No forecast.

  6. LarrytheG Avatar

    growth will lower taxes? a novel idea for sure…. but hate to break it to you but I don’t think I have EVER heard such a thing actually happen!!! I always thought it was a standard lie told by politicians to those who were willing to believe it pretty much along the lines that tax cuts would lower the cost of govt!!!!

    can you tell I’m a cynic? 😉

    1. TooManyTaxes Avatar

      Arlington County readily advertises that it has the lowest real estate taxes in the area and offers one of the highest levels of service. Accepting arguendo those as good results, the commercial revenues from the Rosslyn Ballston Corridor are generally credited as the root cause.

      We residents of Fairfax County have been treated to the same argument – Tysons can produce lower real estate taxes – at least in real terms. I was just asking the County to provide more details. Now could our supervisors have been fibbing to us?

  7. Reed Fawell 3rd Avatar
    Reed Fawell 3rd

    Inova and UVA pulled off this deal because they both overcharge their students and patients, and soak taxpayers of vast amounts of money to line their own pockets, while refusing to properly educate their own students. This has been going on for a decade.

    Meanwhile their arrogance and waste soars. Uva’s Sorensen Institute, for example, recently appointed itself as not only an instructor of government affairs for its young UVa students but also designated itself as the instructor of US Presidents for the duration their first 100 days in office. Imagine that? And the State of Virginia is no longer big enough and good enough for the University of Virginia. So UVa has gone global, serving the Chinese.

    And what has happened to the Virginia Governor’s $15 million dollar gift of other peoples’ money (taypayers’ money) to fund the Inova / George Mason deal on the Exxon site? Is the Governor going to reach into in his pocket to repay Virginia’s taxpayer for that laughable and corrupt giveaway of taxpayer money? And how are folks expected to get to the Exxon site?

    And is UVA going to return the $2.4 billion that UVA fleeced under false pretenses from its own students and taxpayers generally over the past decade? And how about the $60 million spent to fund the New Disney World Rotunda, a rip-off orgy of waste and pretense to house UVa’s board of Visitors?

    Is this only a start on UVa.’s road to becoming a global powerhouse of influence peddling, theft of public moneys, and “look at me” posturing claims of greatness and achievement built on little more than other peoples’ money? When will this Ponzi scheme collapse? I’d bet it will fall apart far sooner than we expect.

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