STATE OF THE ART
Venture capitalists, grab your textbooks and lab coats. A new stage of the biotech revolution is under way in the 265 laboratories around the world working on the 15-year, $3-billion Human Genome Project (HGP). The HGP is an attempt to map the entire human genome -- the 100,000 genes and 3 billion chemical compounds that form the complete genetic instruction set for a human being. In the past 18 months, at least eight genome-related companies have sprung up, hoping to find the genes that either cause or predispose people to any number of diseases -- and thus to create more effective treatments. The new companies have, all told, raised about $100 million, according to BioWorld Financial Watch. "The rapid acceleration in technology developments and the raw knowledge about the genome create one of the most lucrative and seductive opportunities I have ever witnessed in a dozen years in venture capital," notes Kevin Kinsella, a general partner with Avalon Ventures, in La Jolla, Calif. Kinsella himself launched a genome start-up last August. But on top of their technical challenges, genome start-ups confront some additional sticky issues: patenting genes or gene fragments can be tricky. Then, too, the possibility of genetically screening human beings poses huge moral questions.
Some start-ups jumping into the genome fray:* * *
"If you actually know the gene that causes a disease, your drug development is that much more relevant," notes Mark Levin, a venture capitalist with the Mayfield Fund, in Menlo Park, Calif., and a five-time biotech-company founder. Levin's latest start-up is Millennium Pharmaceuticals. Launched in January 1993 with $8.5 million of venture funds, Millennium is a gene-sleuthing and drug-development company that is initially targeting complex but common conditions like obesity and Type II diabetes. The start-up, which has attracted two internationally renowned gene experts as "founding scientific advisers," hopes to raise $150 million to $200 million over the next four to five years.* * *
Glen Evans likes to say he is working on the ultimate Star Trek scanning device: an object you can hold in the palm of your hand that will tell you your precise genetic makeup. "It's not inconceivable that with this technology you could stand on a street corner in New York City touching people to look for a potential kidney or bone-marrow donor," says Evans, the director of the Salk Institute's Molecular Genetics Lab. He is also a scientific adviser at and cofounder of Nanogen, a venture-backed start-up that is developing diagnostic methods using semiconductor sensing chips. By putting DNA information onto a microchip instead of studying it in a test tube, Nanogen's technique should permit multiple analyses of even the tiniest sample. The anticipated results are cost savings and speed, notes CEO Howard Birndorf.* * *
"We are not a genome company in the sense that others are," says Mark Pearson, one of the nine founders of Darwin Molecular. Darwin is taking a vertically integrated approach that Pearson claims will enable it to beat competitors to the market with proprietary oral drugs. First, the company hopes to speed up DNA analysis 10-fold to 100-fold by using robotics and automation. Then Darwin will use three-dimensional computer modeling and electronic "protein libraries" to store and process the vast amounts of information generated. In keeping with its name, Darwin also hopes to evolve, in test tubes, "designer" molecules that can intervene in the progression of diseases such as cancer and AIDS. The company received its $3 million in start-up funds from two of its founders, biotech veterans George Rathmann (founder of Amgen and current CEO of ICOS) and Ronald Cape (founder and former chairman of Cetus).
-- Alessandra Bianchi