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Gene-IT Kicks Off 2007 with New Customer, New Exec; Eyes Dx Market as Growth Driver

Coming off a year in which it nearly doubled its business and added around 25 new customers, Gene-IT has expanded its executive team in hopes of driving additional growth in 2007.
This week, the company announced that it had appointed Michael McManus, most recently vice president of business development for the BioSciences group of Fujitsu Computer Systems, to the newly created position of vice president and general manager.
The company also announced this week that medical diagnostic firm Biosite has become the latest customer for its GenomeQuest sequence search service — an agreement that underscores the firm’s goal to establish a stronger foothold in the diagnostic market in the year ahead.
McManus, who has also held executive positions at AnVil and CambridgeSoft, will head up the company’s product marketing efforts. He’ll work with two other informatics industry veterans who have joined the firm in the last year: Nick Mitropoulos, vice president of worldwide sales, who was formerly vice president of sales at Accelrys; and Drew Arnold, head of strategic accounts, who previously led Lion Bioscience’s US operations.  
McManus said that his primary role will be to better elucidate the benefits of GenomeQuest, which falls into a category he described as “integrated genomics search.”
GenomeQuest’s search methodology “presents a unified view of many disparate data sources in a format that’s easy to understand and make decisions about, and it’s the use of search as an underlying methodology for bringing together disparate data that’s different than the traditional data integration that’s used to connect separate databases,” McManus said.
“That’s the category we have to define — to show that it’s a viable methodology, that customers value it, and that it gives meaningful results,” he said. “Our customers are telling us it does, but what we haven’t done yet is to explain to the market what we’re hearing from our growing customer base.”
The company claims that GenomeQuest offers a number of improvements over traditional sequence search tools like NCBI Blast — particularly when searching patent databases for gene sequences. Unlike Blast results, GenomeQuest can display hits sorted by priority date or other parameters, such as species. The software also draws from multiple resources, including the major public sequence repositories, commercial suppliers of sequence content, and the US Patent and Trademark Office and other worldwide patent offices.
Gene-IT released GenomeQuest in early 2004 and initially targeted it toward intellectual property professionals within biotech and pharmaceutical companies as well as patent offices and biotech law firms.
By the end of 2005, the company had around 40 customers for its software. CEO Ron Ranauro told BioInform this week that the firm added around 25 new customers during 2006. The privately held firm does not disclose its sales figures, but Ranauro said that Gene-IT “almost doubled the business year over year from 2005 to 2006.”
Gene-IT also made good on several product-development goals that it set for itself in 2006. After raising $4.1 million in first-round financing in late 2005, company officials said that they planned to release new GenomeQuest modules for RNA interference and diagnostic biomarker discovery during 2006 in order to expand the company’s customer base beyond its core of IP specialists [BioInform 12-05-05].
The Biosite agreement is a sign that this strategy has paid off. Ranauro said that the company now has around a dozen diagnostic firms on its roster, though many of them have not yet been disclosed. Those that it mentions on its website include Roche Diagnostics, bioMérieux, and Third Wave Technologies.
Ranauro said that diagnostic firms face particular challenges when it comes to sequence searching that should drive demand for GenomeQuest’s capabilities. “In the Human Genome Project era, the IP search problem revolved around genes and who owns the genes,” he said.

“As pharmaceuticals in-license biotech therapies where diagnostic products might be considered part of the go-to-market strategy, having a clear IP position around not just the therapy, but the diagnostic, could be critical.”

Now, however, “We’re seeing this dynamic where there is this much longer tail, where there are many, many, many more companies that are involved in using genetic information for diagnostics or other alternative approaches to understanding human disease and therapy that don’t have the scale and resources of a pharmaceutical and are actually driving a lot of the growth and the demand for this kind of information and for these kinds of tools.”
Ranauro added that for diagnostic firms, “the amount of information is staggering and the actual needle that they’re looking for is exceedingly small in most cases. Diagnostic probes are not typically full-length genes, so the signal to noise can be almost unbearable.”
Michael Whittaker, vice president of intellectual property at Biosite, told BioInform via e-mail that the company was previously using NCBI’s Blast to conduct patent searches on sequences of interest. “The difficulty with this method, however is that often, patentees may not use the same names for these sequences in their patent literature and so regardless of how complete a database may be, a search by a certain name may not pull all the relevant IP associated with a certain target,” he wrote.
Whittaker said that Biosite decided to seek another option “to ensure a more rapid, accurate, complete search,” and decided on GenomeQuest after considering several other products.
Ranauro said that the drive toward personalized medicine and companion therapeutic/diagnostic products should drive further demand among biotechs and pharmas to build solid IP strategies around biomarker sequences. “As pharmaceuticals in-license biotech therapies where diagnostic products might be considered part of the go-to-market strategy, having a clear IP position around not just the therapy, but the diagnostic, could be critical,” he said.
In addition, the company intends to expand its market beyond the IP space with the launch of a GenomeQuest upgrade in the first half of the year. Company officials declined to provide further details on the target customer base for the new product, however.
McManus said that one of the company’s “major goals” for 2007 is to “get that out soon and use it to drive business going forward for rest of the year.”
Ranauro noted that the firm is “well funded” and that it doesn’t intend to seek additional financing in 2007. At the end of the year, he said, “the question will be, ‘What’s the expanded growth opportunity as to whether we need more [financing] or whether our own organic growth can drive the company to meets its goals?’”

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