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Proteomics Companies Struggle In 2002, But Mass Spec, Academics Thrive

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2002 has been a mixed bag for the fragmented proteomics industry. While several companies that offer proteomics-based research were struggling to sign up new customers to keep their revenue streams flowing, mass spec vendors other than the patent-perturbed Waters generally had a good year, and academic researchers received plenty of funding.

Among the proteomics companies, neither Cellzome nor MDS Proteomics has translated impressive scientific results into partnerships yet. The companies made a splash early in the year with their simultaneous publications in Nature of comprehensive analyses of protein complexes in yeast, which demonstrated their technical capabilities. However, there was little overlap between the two datasets, pointing out the need for validation of proteomics data by different methodologies. Cellzome then hired David Brown, a veteran of the pharmaceutical industry, last fall to help it market itself more effectively. Around the same time, MDSP announced a shift in its business strategy, offering companies services more downstream in the drug discovery process, rather than in target discovery. This strategy might be paying off: MDSP said last week it is close to signing a deal with a pharmaceutical partner (see article below).

Cellzome and MDSP were not the only ones who found the partnership scene difficult. Last July, GeneProt decided to postpone its planned new facility in New Jersey indefinitely because it had not been able to sign up a deal similar to the one it has with Novartis in Switzerland that would keep the new US site busy.

But a number of companies convinced pharma to sign on for proteomics: in January, Syrrx announced a multi-year research collaboration with Pharmacia. Affinium Pharmaceuticals struck a $30 million deal with Pfizer in May — maybe its new name, changed from “Integrative Proteomics” in March, helped. In September, SurroMed and Eli Lilly started a collaboration. Then last month, Serenex signed a deal with Johnson & Johnson, after another with Pfizer/Pharmacia this summer. Astex Technology signed up with Mitsubishi Pharma, and Ciphergen started working with Novartis.

One recurrent theme among proteomics companies this year was the need to cut costs and to refocus business to areas that might pay off more quickly. This summer, Large Scale Biology laid off 30 percent of its workforce and cut its spending by 30 percent to focus on more immediate revenue streams. Structural Genomix laid off 20 percent of its workforce, especially in bioinformatics, to change its focus from discovering targets to developing lead compounds. In the fall, Oxford GlycoSciences laid off 40 employees and cut its proteomics spending in favor of taking drug candidates into clinical development. Finally, GeneProt said recently it would lay off 20 employees by January and slash its spending by 40 percent in 2003, while MDSP told ProteoMonitor last week that it had laid off about 35 people and cut its burn rate by $10 million this year.

News in the mass spectrometry sector was dominated this year by the US patent dispute between ABI/ MDS Sciex and Waters over Waters’ high-end triple quadrupole technology. In June, a judge ruled against Waters, which had already pulled several of its instruments off the US market and experienced a downturn in its mass spectrometry sales over the year. The general economic climate did not seem to affect mass spec vendors overall, though: ABI, Thermo Finnigan, and Bruker all reported strong orders and increased sales for the third quarter.

Meanwhile, “biomarkers” seemed to be the new buzzword. After Lance Liotta and Emanuel Petricoin published a study of ovarian cancer biomarkers in The Lancet in February, using Ciphergen’s chip technology, diagnostic protein markers suddenly seemed like an attractive way to translate proteomics into products fast. In this area, Correlogic licensed its technology to Quest Diagnostics and Labcorp in November, Syn X Pharma received a patent for its Alzheimer’s marker and partnered with Ortho-Clinical Diagnostics; while OGS won a $5.5 million Cystic Fibrosis Foundation grant to find CF biomarkers, and Matritech started working with Mitsubishi Kagaku Medical on a mass spectrometry-based breast cancer test.

Throughout the year, funding for academic proteomics showed no sign of drying up. In October, the National Heart Lung and Blood Institute named 10 proteomics centers across the country that will receive a total of $157 million over the next seven years. Likewise, the Department of Energy’s Genomes to Lifes initiative doled out $57.5 million for three teams of proteomics researchers. Other NIH institutes are getting interested in neuroproteomics.

Finally, the Human Proteome Organization defined five initiatives this year, and is busy getting them off the ground. In November, HUPO organized its first world congress in Versailles, attracting about 880 proteomics researchers from all over the world.

While the economic climate next year might still be uncertain, these developments indicate that interest in proteomics is still high, and the field appears poised for continued expansion.

— JK

 

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