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Research Triangle Institute

Research Triangle Institute

3040 Cornwallis Road
Research Triangle Park, North Carolina 27709
U.S.A.
Telephone: (919) 541-6000
Fax: (919) 541-5985
Web site: http://www.rti.org

Nonprofit Company
Incorporated:
1958
Employees: 2,500
Sales: $467.6 million (2005)
NAIC: 541710 Research and Development in the Physical, Engineering, and Life Sciences; 541720 Research and Development in the Social Sciences and Humanities

Research Triangle Institute (RTI) is the second largest independent nonprofit research organization in the United States. The institute, which operates primarily under its trade name, RTI International, employs more than 2,500 individuals who offer analysis and technical solutions to governments and businesses in the areas of health and pharmaceuticals, advanced technology, surveys and statistics, education and training, economic and social development, energy, and the environment. Established by Duke University, the University of North Carolina, and North Carolina State University, RTI operates independently of the universities and solicits its research funds, obtaining the majority of its revenue from government grants. The organization has nine offices in the United States, five international offices, one international subsidiary in Poland, and project offices scattered throughout the world.

ORIGINS

RTI's distinguished record of achievement began not long after the organization was formed, no doubt pleasing the individuals who promoted the idea of establishing a research institute in North Carolina. During the late 1950s, state leaders, including Governor Luther H. Hodges, sought a solution for what they perceived to be a pressing problem: North Carolina's dependence on low wages in the textile, farming, and furniture industries. Hodges, perhaps more than RTI's other promoters, was well aware of the industrial conditions in the state he presided over. Hodges spent 31 years working in the textile industry, rising from mill worker to the top of the leadership ranks. As a textile executive, he championed vocational education programs in the state, developing an avid interest in issues he adopted as his cause when he embarked on a political career after retiring in 1950. Elected governor in 1956, Hodges focused his political work on attracting new industries to North Carolina, seeking to elevate the stature of the state's commercial activities. RTI, formed during Hodges' administration, did much to advance North Carolina's reputation in this regard, attracting some of the most accomplished scientists in the world. Hodges went on to become U.S. Secretary of Commerce in the Kennedy administration, while RTI, too, achieved national prominence, making great strides in the advancement of technology and in life sciences.

The idea behind RTI's formation was to harness the intellectual assets already possessed by the state. Government, business, and educational administrators came together and discussed the establishment of a research park to be located between Duke University in Durham, North Carolina State University in Raleigh, and the University of North Carolina at Chapel Hill. The park became known as Research Triangle Park, a complex whose first tenant was RTI, a nonprofit research organization that operated independently of the three universities and solicited its own research funds. RTI's first projects included applied statistics and environmental research, but not long after the institute was founded, work began on what arguably became the most important project completed under the aegis of the institute.

In 1960, RTI hired Monroe E. Wall to develop the institute's chemistry and life sciences division. Wall, who had spent nearly 20 years working for the U.S. Department of Agriculture before joining RTA, hired an assistant, Mansukh C. Wani, in 1962 and together the pair began testing the reaction of natural products to human diseases. Wall and Wani identified compounds in the bark of a rare evergreen tree found in the Pacific Northwest, the yew tree, that were effective at killing cancer cells. They also found compounds in a tree native to China and Tibet that could be used to treat ovarian, breast, and lung cancer. The two discoveries eventually led to the development of two blockbuster drugs, Taxol, which was produced from an extract of the yew tree, and Campothecin, derived from Camptotheca acuminata. For their research, Wall and Wani were considered candidates for the Nobel Prize, attracting attention from the scientific community that thrust RTI into the limelight and lent legitimacy to the young institution.

RTI made numerous contributions to the advancement of science and social studies during its history. The handful of scientists composing its staff at its outset grew into the thousands as the years passed, with new arrivals bringing expertise in a variety of disciplines, including health, drug discovery and development, the environment, advanced technology, and international development. After starting with applied statistics and environmental research, the institute branched out into other areas, its diversification fueled by a steady flow of research contracts conducted under contract to government agencies, companies, and foundations. In 1962, RTI's first environmental project consisted of a survey of public health attitudes on threats from air pollution. Midway through the decade, the National Aeronautics and Space Administration (NASA) searched for ways to introduce the technologies it developed for space exploration into the commercial market. RTI was selected in 1966 as one of seven teams to discover commercial applications for NASA's pioneering work. In numerous instances, RTI's multidisciplinary expertise in statistical, physical, and life sciences was sought after for health and education research and to develop new technology, making for an impressive portfolio of achievements.

COMPANY PERSPECTIVES

As our mission affirms, RTI is dedicated to improving the human condition through cutting-edge study and analysis in health, drug discovery and development, the environment, education and training, economic and social development, advanced technology, and international development. We are proud of our scientific stature and our reputation for innovation. By continuing to conduct impartial, reliable, multidisciplinary research and by helping to develop and broker new technologies for our clients, we are fast becoming the world's preferred resource for turning knowledge into practice.

NEW ERA BEGINNING IN 1999

RTI enjoyed steady leadership throughout its first half-century of existence, rarely having to experience the potentially jarring transition from one reign of command to another. During its first 40 years in operation, the institute was guided by only two different leaders, which made the appointment of its third leader a notable occasion. The selection of Victoria Franchetti Haynes, the first female to head RTI, as president and chief executive officer in 1999 represented far more than a rare transfer of power, however. Under her direction, the institute began to adopt a markedly different approach to its endeavors by developing beyond the straight research role it played during its first four decades of existence. Haynes intended to retain RTI's status as a nonprofit organization, but instead of brokering licensing deals for new technologies she intended to bring innovations to market by creating independent, for-profit companies whose spin-off from RTI would generate funds for research projects. At the same time, Haynes wanted to increase RTI's interactions with corporate clientele, as she sought to lessen the institute's dependence on government research grants, which accounted for nearly 90 percent of RTI's revenues when she joined the organization.

The arrival of Haynes marked the beginning of what promised to be a new era at RTI. Raised on a farm in Redding, California, Haynes earned a doctorate in physical and organic chemistry at Boston University, spending nearly 25 years in research, management, and business development capacities before joining RTI in July 1999. After leaving Boston University, she joined chemicals giant Monsanto on a government contract job in analytical chemistry, eventually rising to director of technology at the corporation's plastics division. Haynes left Monsanto in 1992 after 15 years of service and joined B.F. Goodrich, first serving as vice-president of the company's advance technology group before being promoted to the position of chief technical officer. At B.F. Goodrich, Haynes established "a tremendous track record in the administration of research," according to a B.F. Goodrich colleague quoted in the February 11, 2000 issue of the Triangle Business Journal, giving her the credentials to attract the attention of RTI's 30-member board of business leaders and university administrators. "I had spent my life doing research and managing research," Haynes said in June 29, 2001 interview with the Business Journal, reflecting on her appointment as RTI's leader. "Now I had the opportunity to run a research business."

When Haynes joined RTI, the institute employed a staff of 1,525 worldwide with record-high revenues of $206 million. There were 900 social scientists, 350 engineers, and nearly 300 scientists in chemistry and life sciences working for the organization, conducting research under contract for clients such as the National Institutes of Health, the U.S. Environmental Protection Agency, NASA, pharmaceutical giant Glaxo Wellcome, and RTI's largest customer, the U.S. Department of Health and Human Services. Haynes wanted to achieve an even split between government and commercial work, a balance she believed would take 20 years to realize. Her more immediate goal was to commercialize RTI's research work, something the institute had tried before Haynes's arrival.

In 1995, RTI helped launch Data Communications Technologies, a company devoted to marketing data-compression technology. In 1998, the start-up venture was sold to Atmel Co., providing RTI with capital it plowed into another start-up venture. With $1.3 million from the Data Communications spinoff and the help of venture capitalists, RTI launched Ziptronix, a semiconductor technology company that served as Haynes' blueprint for her directive to commercialize the institute's technology. Ziptronix, which used RTI-developed technology that integrated multiple chips in a device so they acted as one chip, was spun off in October 2000, giving the institute a way to cash in on the proprietary technology it developed while adhering to its charter as a nonprofit organization.

Haynes intended to follow Ziptronix's spinoff with other technology developed by the institute. RTI was working with a Massachusetts-based biotechnology company, Addiction Therapies, to market what had the potential to become the first pharmaceutical treatment for cocaine addiction. The institute also was involved in research related to ultra-clean gasoline and nearing the point for the commercialization of the technology. "We have started investing much more aggressively in our intellectual property," Haynes remarked in a November 16, 2000 interview with the News & Observer, taking "an essential step toward building financial strength."

KEY DATES

1958:
Research Triangle Institute is formed.
1967:
Two of the institute's scientists, Monroe E. Wall and Mansukh C. Wani, isolate compounds that lead to the development of Taxol.
1999:
Victoria Franchetti Haynes is appointed president and chief executive officer of the institute.
2000:
Ziptronix is spun off as an independent company.
2001:
A new business unit, RTI Health Solutions, is formed.
2004:
Revenues exceed $500 million for the first time.

As Haynes sought to balance the ratio of government to corporate business and to create money-making start-ups using the institute's proprietary technology, the organization's profile was altered. The changes reflected the two new aims of RTI, giving it the infrastructure to pursue its goals. In May 2001, RTI Health Solutions was formed, a new business unit that began operating out of Research Triangle Park and an office in Manchester, England. The business unit was created to provide analysis services to the healthcare industry, representing another attempt by Haynes to commercialize the institute's research. RTI Health Solutions' mission was to determine the value of healthcare products for the pharmaceutical and medical devices industries by providing analysis of product cost-effectiveness and clinical trials. Before the end of the year, Haynes made another bid to strengthen the institute's presence in the marketplace, forming a new business unit named Corporate Ventures, which was focused on commercializing the institute's research. At roughly the same time Corporate Ventures was formed, RTI acquired Health Economics Research, a Boston, Massachusetts-based for profit research firm with 47 employees.

RTI approached its 50th anniversary enjoying robust financial growth under the control of Haynes. She took the helm of a $200 million organization in 1999 and celebrated eclipsing the $500 million mark five years later. RTI's financial growth during the period was aided by a contract with the U.S. Agency for International Development. Awarded in 2003, the three-year contract, originally budgeted at up to $467 million, involved the reconstruction effort in Iraq, providing a substantial boost to the institute's annual revenue total. In the years ahead, as Haynes strove to make her vision a reality, the pursuit of commercial business was expected to deliver continued financial growth, providing the funds for RTI's research projects in its second half-century of existence.

Jeffrey L. Covell

PRINCIPAL SUBSIDIARIES

RTI-Polska Sp z.o.o. (Poland).

PRINCIPAL COMPETITORS

Science Applications International Corporation; Battelle Memorial Institute; The Scripps Research Institute.

FURTHER READING

Begos, Kevin, "Good Intentions Meet Harsh Reality," Winston-Salem Journal, December 19, 2004, p. A1.

Burritt, Chris, "Research Triangle Park Turns 40," Atlanta Journal-Constitution, February 21, 1999, p. D5.

Cannon, Steve, "Monroe E. Wall, Co-Inventor of Cancer Drug Taxol, Dies at Age 85," News & Observer, July 8, 2002.

, "Raleigh, N.C.Area Tech Research Group to Expand," News & Observer, December 14, 2000.

Dyrness, Christina, "President of Raleigh, N.C.Area Research Institute Outlines Goals," News & Observer, November 16, 2000.

, "Raleigh, N.C.Area Research Center Plans to Make Money from Its Technologies," News & Observer, February 15, 2002.

Leo, John, "'Country Girl' Leads RTI to 'Be the Best,'" Business Journal, June 29, 2001, p. 3.

Michael, Karine, "RTI Takes New Tack," Triangle Business Journal, May 19, 2000, p. 1.

Sherman, Denise, "Haynes Prepared to Lead RTI's Growth," Triangle Business Journal, February 11, 2000, p. 30.

Zimmer, Jeff, "North Carolina's Research Triangle Institute Reports Further Growth," Herald-Sun, May 17, 2001.

, "Raleigh, N.C.Area Nonprofit Research Institute Reports Record Profit," Herald-Sun, November 15, 2000.

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