Less than a year after the merger between eBioinformatics and Empatheon created Entigen, the company has closed its Sydney, Australia, office and laid off all its employees in Australia.
As BioInform went to press last week, a source at Entigen confirmed that the Sydney office was closed last month, that all Australian employees were laid off, and that a “substantial number” of US employees were also let go.
Entigen officials were not immediately available for comment.
According to the source, employees were told the company had been close to securing a new round of funding, but the investors pulled out in the wake of the September 11 attack, leaving the company out of cash.
Last month, BioInform learned that Entigen had changed the pricing structure for its BioNavigator online bioinformatics service (www.bionavigator.com) and had eliminated free trials as an option for access to the site.
BioNavigator, which used to be a pay-as-you-go service, was changed to a subscription-only service. Howard Goldstein, president of Entigen, told BioInform at the time that, “customers were spending what the annual subscription is anyway, so it made more sense to allow them to pay up front.” He added that Entigen’s decision came as part of its plan to move from its original online model toward in-house installations of BioNavigator behind company firewalls.
At first glance, it appears that the Australian layoffs eliminate the bulk of the Entigen’s bioinformatics staff. At the time of last year’s merger, eBioinformatics — a spin-off from the Australian National Genomic Information Service — had around 67 employees, while Empatheon had around 20. The bulk of eBioinformatics’ employees at the time were based in Australia, while Empatheon’s were located in Sunnyvale, Calif., and India. Empatheon did not have any bioinformatics staff.
The combined company married the bioinformatics capabilities of eBioinformatics with Empatheon’s java-based integration technology, called Adaapt.
Since the merger, Tim Littlejohn, who founded eBioinformatics and served as its CEO and CSO, left Entigen to launch BioLateral, a bioinformatics contract and consulting company based in New South Wales, Australia.
Littlejohn, who still serves as chair of Entigen’s scientific advisory board, said a total of six former eBioinformatics founders are on the BioLateral staff. He told BioInform that as Entigen moved its focus to North America, several members of the staff elected to stay behind in Australia where a “tremendous opportunity” still exists for bioinformatics consulting.
It seems that the opportunity for online bioinformatics services such as BioNavigator may be waning, however, as the news of Entigen’s troubles accompanies speculation across the industry that another bioinformatics portal company, DoubleTwist, may be facing a similar fate.
Although DoubleTwist joined Entigen last month in eliminating free trials from its online offerings, DoubleTwist spokeswoman Nicole Litchfield said the decision was based on the product’s success more than the need to cut costs. “We introduced thousands of customers to the service over the last two years during our introductory period and we were able to convert customers that way,” Litchfield said. She added that DoubleTwist now has a strong sales organization in place, which is the primary vehicle for selling the product now.