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GeneGo Quietly Gets a Head Start in Systems Biology Software Market

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2000 was a big year in the genomics world, but even as the hoopla surrounding the completion of the draft of the human genome sequence helped fill the pockets of many genomics entrepreneurs, VCs were wary of backing systems biology startup GeneGo. “It was an ambitious idea, and they told us it couldn’t be done,” said CEO and founder Tatiana Nikolskaya.

Undaunted, the New Buffalo, Michigan-based firm went ahead with its plans to create a set of tools “to allow scientists to take advantage of everything already discovered in biology.” With a core management team in Michigan and a team of developers in Moscow, the company was able to bootstrap its way through 2001, when financial help finally came in the form of a $210,000 grant from the Michigan Life Sciences Corridor seed fund. The funding helped the company incorporate in September of that year and begin concentrated development of a pathway database and analysis platform called MetaCore, which it officially launched last month.

In the meantime, the company relied solely on word of mouth and its consulting skills to build a sizable customer base. These customers include Chemical Diversity, BioMax, GDC, PharmPark, University of Southern California School of Pharmacy, University of Miami Department of Ophthalmology, the UCSD Department of Bioengineering, and other commercial firms still under non-disclosure agreements. Several of these organizations, as well as a few large pharmas, are now pilot testing MetaCore, according to Julie Bryant, VP of business development at GeneGo.

While MetaCore was in development, “We were tight on the budget. We didn’t advertise or go to meetings. We were really in survival mode,” said Nikolskaya. But that situation is likely to change now that the company has made its commercial debut. With a steady revenue stream from its current customer base, the company is planning to expand its marketing activities to extend its presence in the market over the course of the year. In addition, GeneGo has applied for an SBIR grant to support development of its next product. If GeneGo gets the grant, it will have the luxury of funneling its current revenues into marketing rather than R&D. The upcoming software, an ADMET prediction package called MetaDrug, is expected to launch by the end of the year.

For now, GeneGo is anxious to take full advantage of the slight head start it has over its growing list of competitors in the pathway bioinformatics and systems biology informatics market. Well aware of commercial players like Gene Network Sciences, Genomatica, and Paradigm Genetics (see story on page 1), as well as publicly available platforms like KEGG, BioCyc, GenMapp, and BioCarta, Nikolskaya stressed that most of these efforts focus on non-human species such as yeast or E. coli, or on very limited areas of human sub-cellular biology. “We’ve identified pathways for almost all important human diseases,” she noted.

GeneGo, in fact, estimates it would take 88 man-years to duplicate the MetaCore database, which includes over 150 tables that hold 5,000 human-specific metabolic pathways, 11,200 human metabolic reactions, 2,000 human regulatory interactions, 32,000 pathway/disease links, 3,700 binding sites, 1,400 transcriptional factors, and 11,600 metabolites, according to the company. A particular point of pride for the company is a list of 50,000 synonyms that GeneGo researchers were able to resolve in the biological nomenclature stretching back to the 1950s.

But even as the company celebrates the launch of its software, it once again faces a financial challenge: The Michigan Life Sciences Corridor, originally funded by Michigan’s tobacco settlement money in 1999, has had its 2003 budget slashed in half as the state grapples with a fiscal crisis. The company must now compete for its latest round of funding against other MLSC grantees, and is preparing for its final interview on May 6. Considering the company’s history so far, it’s likely it will find a way to survive whatever the outcome may be.

— BT

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