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Rich ambitions – Tri-Cities lab has a huge list of high-tech research projects, and Spokane economic development groups hope to land a piece of the action

Nearly two years ago during a meeting in Richland, Wash., four visitors from Spokane economic development groups were talking about the fast growth taking place in the Tri-Cities. They had just toured the 220-acre Pacific Northwest National Laboratory, based in Richland. The tour showcased dozens of high-tech projects taking place there, focusing on fuel cells, nanotechnology and molecular-biology instrumentation, among others.

Tom Sowa /
Staff writer

http://www.spokesmanreview.com/allstories-news-story.asp?date=050904&ID=s1517965

“What would it take to move this lab to Spoka
ne?” one person in the group asked Gary Spanner, manager of PNNL’s economic development office.

Spanner, recalling that visit, said he “burst out laughing” at the idea that the sprawling lab, in operation since 1965, could pack up and relocate.

He said the question was both flattering and serious. It was proof that more people in Spokane believe Spokane’s economic future needs to be linked to the brainpower clustered at PNNL’s facilities on edge of the Columbia River.

With 3,600 workers in Richland, PNNL spends about $600 million annually on research projects. Officials at the lab say national priorities on increased energy efficiency and homeland security could push the budget to $1 billion in five years.

Spanner said many people misunderstand the lab’s federal role, sometimes confusing it with Hanford.

PNNL, part of a group of nine U.S. Department of Energy national labs, gets federal contracts for cutting-edge technology projects. Some involve fundamental research on narrow subjects within the areas of biology and chemistry. But others are keyed to a specific goal, such as finding a non-intrusive system to identify non-metallic weapons hidden under the clothing of people boarding airplanes.

That huge list of research projects, inevitably, has led to about 700 patents, and at least 80 companies have been spun out of the work done by researchers at PNNL.

To date, Spokane and North Idaho have not been successful in landing any of those spin-off companies, Spanner said. No such companies have formed in Pullman or Moscow, either. The largest concentration of PNNL spin-offs — about 60 start-ups — are based in the Tri-Cities, Spanner said.

Making Spokane a stronger contender for PNNL spin-offs is now a much larger goal for the area’s economic development strategists, several officials have said.

“There is certainly a lot more that we can do to reach out and connect with PNNL,” said Nathan Brown, a business consultant and author of a 2001 study called “The Innovation Economy.” That study included the suggestion that area leaders build more ties to PNNL.

“The lab is a major brick in the development of the Tri-Cities’ recent strong growth,” Brown said. He added that PNNL is the closest thing Spokane has to a technology complex similar to Stanford University or the Massachusetts Institute of Technology, both of which helped propel their surrounding communities to technological dominance.

“We have to get over the psychological barrier that it’s not close,” Brown said. “It’s just two hours away from Spokane.”

Since its inception in 1965, its role has evolved from providing research for the nearby Hanford nuclear site to becoming a think tank with scientists and engineers given the best equipment and sufficient money to develop new ideas and cutting-edge technologies.

One of those technologies, the CD-ROM — a polymer-coated digital disk that replaced phonograph records — is credited to a PNNL researcher in the 1970s, James Russell.

There are plenty of examples of companies selling products that were hatched by PNNL’s brain brigade. Among them:

• Landauer Inc., based in Glenwood, Ill., generates more than $10 million a year selling a wearable radiation badge called the Luxel. That product is licensed to Landauer by PNNL, which developed its underlying technology — for Hanford workers, originally — about 10 years ago. The Luxel now is sold worldwide to hospitals, nuclear-power sites and anywhere a person might be exposed to radiation. PNNL has received more than $1 million in royalties for licensing its technology to Landauer.

• Cool Clean Technologies, Inc., based in Minneapolis, has developed a successful chain of dry-cleaning franchises that use “supercritical carbon dioxide” technology developed at PNNL. The Cool Clean system is a safer, more effective alternative to traditional dry-cleaning solvents, according to Bill Farris, a manager of technology commercialization at PNNL.

• Mehl, Griffin & Bartek, a Virginia company, expects to sell several thousand units of an acoustic inspection device that originally was developed by PNNL researchers. The product tracks the speed of ultrasound waves moving through a container of liquid. U.S. Customs officials, Homeland Security agencies and the FBI are among several clients using the system to identify the contents of those containers.

Farris said there’s no reason why some of those breakthrough ideas couldn’t be developed by local companies, creating hundreds of good jobs in Eastern Washington or North Idaho.

PNNL isn’t permitted under federal law to give advantages to companies based on where they’re located, Farris noted. Successful examples like Landauer’s Luxel result from private companies learning about PNNL’s research on their own, or because PNNL researchers have identified firms that are the best qualified to develop a product, he said.

Ultimately, added Farris, PNNL will choose the commercial partner that’s best suited to turn the idea into a good product.

Still, he said, “as close as we are to Spokane, it’s natural that we should be able to develop more meaningful relations with companies there.”

Spokane-area leaders, aware now of PNNL’s huge basket of research, have been trying to encourage companies in Eastern Washington to build closer ties to the federal lab. So far, no deals have been developed.

Still, several Spokane and Eastern Washington companies now are looking closer at PNNL. They include ReliON Inc., formerly Avista Labs; Avista Corp.; Schweitzer Engineering Laboratories Inc., of Pullman; and Itron Inc., of Spokane. Those three companies are looking at different areas within PNNL’s list of energy-research projects, which include fuel cells, power grid management and alternative power generation. Also looking at tighter collaboration with PNNL is Inland Northwest Health Services (INHS), the nonprofit that operates the medical-information network for area hospitals. INHS and PNNL officials have talked about using PNNL’s high-end software tools to develop more efficient systems to track medical and public-health information.

Civic leaders here acknowledge it’s their obligation to build those ties with PNNL, not the other way around.

“It’s up to us to make the right contacts to be aware of what’s going on there,” said Jon Eliassen, president and CEO of the Spokane Area Economic Development Council.

Added Patrick Tam, executive director of the Spokane Intercollegiate Research and Technology Institute: “It will require more effort on our part. They (PNNL) have been getting along fine without us.”

Eliassen said one step in the right direction might be if area economic development groups assigned the job of high-tech-related initiatives to just one agency. Tam said increased funding of economic-development groups would allow them to devote more time to establishing closer ties with PNNL.

While no companies in Spokane and North Idaho have licensed a technology or turned a PNNL idea into a commercial product, several have used the lab for guidance and technology assistance.

Steve McGrew, founder of New Light Industries, on the West Plains, has worked with PNNL on several occasions, either through the lab’s “technology assistance program” or through a cooperative research agreement.

The cooperative agreement involved PNNL engineers investigating the best way to develop a 3-D holographic printer. “We ended up with useful results” due to PNNL’s work, said McGrew. New Light spent several thousand dollars on that project, he said.

McGrew said his company will complete its prototype of a holographic printer this summer. New Light then hopes to license it to companies that need 3-D holograms as a security feature for currency, corporate documents and important materials, he said.

PNNL provided similar services to Commuter Cars Corp., a Spokane company that’s trying to market a thin, battery-powered car called the Tango. Another Spokane company, GenPrime Inc., hired PNNL to investigate its PrimeAlert product to see if it was capable of detecting certain biological viruses. That research has been helpful, said GenPrime CEO Jim Fleming.

While Spokane now has a better feel for PNNL’s size and impact, Spanner said his office needs to continue the job of explaining the lab’s unique and complex system and rules.

“We are not an Office Depot with off-the-shelf technology waiting for people to develop,” Spanner said. Nearly one-fifth of the total research done at PNNL is still devoted to cleaning up Hanford. About 43 percent of the lab’s work in Richland is focused on national security, on projects that might never produce spin-off products, he added.

And because nearly all the work there is done for a specific federal contract and a particular need, the technology research usually is not quickly transferable to the marketplace.

“There’s almost always an inevitable development process, taking time and money,” he said.

Farris, whose office evaluates more than 200 PNNL ideas every year and decides which are worthy of patents, said Spokane and North Idaho officials would be smart to place their economic-development bets on three research areas at PNNL: the fuel-cell energy group, the bioscience products area, and analytic instrumentation.

The fuel-cell area is ripe with opportunities to develop “smart-energy” appliances and efficient buildings that will play a key role in addressing the nation’s energy needs, Farris predicted.

The bioscience products area, one of PNNL’s newer focuses, involves research on using agricultural byproducts to develop new chemicals that can be used in products ranging from adhesives to medicines, he said.

Analytic instrumentation, he said, has potential benefits for pharmaceutical firms developing new drugs.

Spokane doesn’t have to be a biotech Mecca to develop the kinds of young companies that could do that kind of work, he added.

Said Farris, “Those companies could be based anywhere.”

“It’s up to us to make the right contacts to be aware of what’s going on there.”

Jon Eliassen, president and CEO of the Spokane Area Economic Development Council, on the need for city leaders to build ties with PNNL

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