Gene Logic, one of the few genomics database companies that weathered the bioinformatics storm of years past, recently announced that it would be extending its business into saving failed pharmaceutical compounds, primarily by finding new indications for them — a strategy Gene Logic calls “drug repositioning.”
CEO Mark Gessler says that this new focus is in addition to, rather than an alternative to, its existing business in genomic data and software. That arm of the business continues to do well, he says, and Gene Logic is in the process of expanding the customer market for its database — traditionally sold to pharma — into academic, government, and biotech settings.
The plan to get into drug repositioning is no small matter. Gene Logic expects to spend $14 million this year to start up this business. That money will go toward broadening the company’s technology (particularly into metabolomics), working with compounds, and sales and marketing costs, Gessler says.
Plenty of genomics companies have tried to establish relationships with pharmas to work on failed compounds, so why does Gessler think Gene Logic will have any more luck than many of its struggling peers? One crucial difference, he says, is that while many biotechs try to license such a compound from a pharmaceutical company, Gene Logic deals in milestone payments and royalties without making claims on IP: pharma delivers its compound, Gene Logic does its work, and the compound is returned to its owner. That adds a level of security for the pharmaceutical company and avoids the miles of red tape typically required to license a compound. That, in combination with the multiple technology platforms Gene Logic has at its disposal, is a model that has never been tried in this field, Gessler says.
Thanks to the company’s years-long informatics relationships with pharmas, Gene Logic already has seven projects in the works for its drug repositioning efforts, Gessler says. The work will rely on Gene Logic’s toxicogenomics expertise and database resources as well as the imaging, screening, and other technology it acquired through its $4.5 million purchase of Millennium Pharmaceuticals’ Horizon group last year.
Ideally, Gessler says, his staff will be able to “take a phase II failure, repurpose it, and drop it back into phase II” — all in less than a year. Gessler, who says the best bets may be compounds that failed for efficacy, rather than toxicity, hopes to have 20 compounds under his roof by the end of this year. And, of course, he and his team are looking to get a failed compound back into the clinic as soon as possible to prove their business model can be a success. If all goes well for the drug repositioning business, Gene Logic hopes to reach profitability in 2007.
— Meredith Salisbury