A year after launching its first commercial system, Sage-N Research has released a new product and is ramping up its internal marketing efforts and expanding its network of software partners.
The company was founded four years ago with the mission of building so-called "integrated data appliances" to handle the informatics demands of proteomics research. A year later, it began collaborating with Thermo Electron to develop an FPGA-based system to speed Thermo's Sequest protein identification software. The firms released the fruits of that effort last February in the form of Sequest Sorcerer, a fully configured appliance that speeds Sequest searches by up to 50-fold [BioInform 03-15-05].
David Chiang, CEO and chairman of Sage-N Research, told BioInform that the company is now "shifting from an R&D focus to a partnership and sales and marketing focus."
In line with that strategy, the firm this week rolled out Sorcerer 2 a higher-end version of Sequest Sorcerer that runs multiple algorithms and is targeted toward larger labs. The launch also marks the company's first in-house marketing campaign: Thermo Electron distributes Sequest Sorcerer, but Sage-N Research will be selling Sorcerer 2 on its own.
"That's one key need we identified when we were doing our market analysis people looking for multiple applications from the same machine."
In addition, Sage-N Research also said this week that it is collaborating with Rosetta Biosoftware to establish interoperability between Sorcerer 2 and Rosetta's Elucidator protein expression analysis software.
Both developments signal a new level of maturity for the company, Chiang said. "It was always our strategy to go with what the marketplace is looking for, which is really multiple applications rather than just Thermo's Sequest. So it's a natural evolution, but we wanted to get one solid [product launch] under our belt" before tackling the marketplace singlehandedly, he said.
The Rosetta collaboration should help Sage-N Research expand its customer base, he added. "We mainly sell into universities doing more basic research, and Rosetta's market is really large pharmaceutical companies doing biomarker discovery and work that is closer to the clinic," he said.
Chiang cited biomarker discovery as a key growth engine for proteomics analysis tools. The company anticipates a "pretty steep climb" in the market over the next three to five years, largely driven by biomarker research. "I think it's a matter of having the biomarker work actually affect the bottom line for these big drug companies. It has to go from being a science experiment to being part of the production flow, where real products are coming out," he said.
"Proteins are where the action is, and I think it will take off," Chiang said. "Proteomics is where we've chosen our beachhead."
Sage-N Research is certainly not the first company to build a business around FPGA-accelerated bioinformatics algorithms companies like Paracel, Time Logic, and Compugen pioneered the use of the technology for DNA sequence analysis in the 1990s but it's the first to do so in the proteomics sector.
So far the strategy appears to be paying off. Chiang said that the privately held firm was cash-flow positive in 2005, and he anticipates that it will also be cash-flow positive in 2006. Sorcerer is currently installed in around two dozen labs, Chiang estimated, including some high-profile groups like Steven Gygi's lab at Harvard Medical School, the John Yates lab at Scripps Research Institute, and Ruedi Aebersold's lab at the Swiss Institute of Technology, Zurich.
FPGA bioinformatics predecessors like Paracel and Time Logic not only limited their business to sequence analysis, Chiang said, but they approached the market in a different way. "We don't view ourselves as an acceleration company, which I think most of the others do," he said. "We're more of an applications company."
The focus on applications is a key element of Sorcerer 2, which supports multiple search algorithms, including Mascot, Spectrum Mill, X!Tandem, Sonar, and Phenyx. Sorcerer 2 has the equivalent throughput of a 500-processor cluster, according to the company, which is about twice the capacity of Sequest Sorcerer. The appliance, which measures approximately 24 x 24 x 8 inches, includes 1.5 TB of storage.
The company would not disclose pricing for the system.
Chiang said that Sage-N Research ultimately plans to support all available proteomics search algorithms. "That's one key need we identified when we were doing our market analysis people looking for multiple applications from the same machine," Chiang said. "So they set up a new lab, and they just buy this and plug it in and all the software is pre-installed and all the researchers dial in with a web interface on their PCs and they get Sequest, Mascot, Phenyx, whatever."
Sage-N Research is currently collaborating with an undisclosed partner to enable researchers to consolidate and compare results from different search algorithms a capability that is currently too compute-intensive for many small labs, he said.
Most proteomics labs currently run one algorithm, "and they all want to run more, but the problem is that they have problems running just one," Chiang said. "With one PC, they have to wait maybe three days for [the data analysis for] one experiment. Now we go in and say you should run at least two, so that's six days and that can be trouble. Now with Sorcerer, they're now starting to look into that."
In addition, while the firm plans to maintain its focus on proteomics, "it's our intent within the next 18 months to branch out," Chiang said. He declined to provide further details on the company's development plans, but said "it will overlap the genomics and proteomics space."
Sage-N Research currently employs 10 people. The firm opened an R&D center in Shanghai, China, earlier this year [BioInform 12-19-05], but Chiang said that the company is still seeking staff for that facility.
"We have the space, but hiring the right people is tough," he said.
Nevertheless, the company expects to double its staff with most of that growth in Shanghai by the end of the year, Chiang said.
Bernadette Toner ([email protected])