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With New Deals in Hand, InforMax CEO Details Growth Strategy, Russian Roots

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OCKVILLE, Md.--1999 was a good year for bioinformatics software provider InforMax. The company doubled its staff to 110 while maintaining its focus on revenue growth and being profitable, Alex Titomirov, chairman and CEO of the ten-year-old operation, told BioInform. Some of the company’s most recent wins involve Bristol-Myers Squibb and the US National Institutes of Health, which both licensed Vector NTI Suite, InforMax’s desktop sequence analysis software package that now has more than 800 customers--more than 10,000 individual users.

InforMax has undergone major growth since its startup days when Titomirov, a Russian émigré with a doctorate in molecular genetics from the Russian Academy of Sciences, launched the company to supply software to speed drug discovery. Titomirov spoke recently with BioInform about his experience growing a startup bioinformatics company in the US.

BioInform: Besides the two new contracts, what else is InforMax doing?

Titomirov: We are seeing a lot of customers who had been with our competitors jump off those ships and return to us. Most of those customers have been using Vector NTI Suite for years but went elsewhere for enterprise software. Now we are in discussions with at least 10 major pharmaceutical companies about enterprise deals for Software Solution for BioMedicine, our enterprise solution.

We are adding more modules to SSBM, including one for gene expression. We’re working on an internet project that will enable almost every researcher to use our website’s intelligent browser, which will be Vector NTI-based. We will be providing a fully integrated in silico drug-development platform by the end of 2000 when the genomics, proteomics, and of course bioinformatics modules and others will be integrated in one platform.

We are also happy with our new management team, which includes Timothy Sullivan, senior vice-president of sales and marketing, and James Bernstein, COO and head of business development. Other key employees are Vadim Babenko, our head of technology development, James Dickey, vice-president of sales and head of the South San Francisco office, and CFO Joe Lehnen.

BioInform: How did the company get to where it is today?

Titomirov: After we were established in 1990, it took us some time to develop our first product, Vector NTI. We wanted to build a brand name and have as many customers as possible in the marketplace before moving on to major products like enterprise software packages. To develop technology like this takes time--it takes no time to license it from other companies, but then integration of that technology and making that technology work is a major problem. The first product was sold in the beginning of 1993. Originally the company raised $175,000 to start and only this past summer we raised $4 million from FBR Technology Venture Partners. Also, we’ve been doubling our revenue every year the past four years--during which we’ve been profitable, too.

BioInform: Is this a rare claim for a bioinformatics software company?

Titomirov: Yes. Most of them, if not all, were based on spending venture capitalists’ money and selling the future. We’ve been bootstrapping, but the payoff was huge because we wanted to keep our independence and not sell our shares of the company to venture capitalists for a small amount of money.

BioInform: What distinguishes your products?

Titomirov: Our company is different from anyone else because we have built our technology ourselves. We pioneered knowledge-based software engineering and are strong in data integration. Our Java applets are large and work no differently than Microsoft C++ code. The performance of Java is such that you wouldn’t see the difference between the C++ programs and the Java programs.

InforMax was built on the idea that medical biologists who know how to program would never be able to build quality code--only vice versa. At our company, mathematicians and programmers built professional code with advice from medical biologists. We made them work together but we never let the biologists write the code because it is so difficult for them. Only three programmers out of 60 have left the company over the last nine years, so we have tremendous consistency among our work force.

BioInform: To what do you attribute your low turnover rate?

Titomirov: The motivation of the programmers, the business climate, and the company’s friendly atmosphere. To get a job at InforMax, people have to pass many tests and procedures. We don’t just hire people on the fly and then figure out what they can or cannot do.

BioInform: Where do you find your computer scientists?

Titomirov: In development, we have a mix but the key programmers are Russian. We have strong connections over there because of our ties to the Russian Academy of Sciences. The Russian education system is very broad and people trained there who are very good mathematicians or programmers, for example, know a lot more about biology than mathematicians trained elsewhere. But don’t think that we only want Russians. We tried to hire people in other countries but we just couldn’t find people from other sources.

BioInform: Is the US educational system different from that of Russia because it allows students to specialize sooner?

Titomirov: Yes, that’s the key because in America’s system, you can study whatever you want, allowing you to avoid some courses. In Russia, there are many requirements and instruction in biology, and math is very strong.

--Matthew Dougherty

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