BioWorld International Correspondent
GeneProt Inc., a Swiss firm attempting to make industrial-scale proteomics a new paradigm for target and drug discovery, is drastically scaling back its operations, slashing its payroll by nearly half.
The Geneva-based company is cutting 45 jobs from a total work force of 95 people in order to reduce cash burn, and plans to revamp its business model and strategy, which, it said, will be based around "smaller, more targeted contracts."
GeneProt's founding team included the founders of the Geneva-based bioinformatics firm GeneBio SA, Denis Hochstrasser, Amos Bairoch and Ron Appel, along with Robin Offord and Keith Rose, both authorities on protein chemistry. It attracted two Nobel Prize winners to its board, Edmond Fischer and Sir Aaron Klug.
The company raised a reported US$122 million, which included backing from equipment vendors Compaq (now Hewlett-Packard Co., of Palo Alto, Calif.) and Waters Corp., of Milford, Mass. It installed 51 advanced mass spectrometers, which it had working around the clock at its Geneva facility, plus supercomputing capabilities in order to crunch the data they generated.
So far, it has disclosed two alliances with pharmaceutical firms. It entered a five-year, US$41 million deal with Novartis AG, of Basel, Switzerland, in November 2000. As part of that, it embarked on a large-scale proteomic analysis of 12 liters of plasma supplied by Duke University Medical Center in Durham, N.C., in order to identify factors associated with heart disease. Earlier this year, it delivered a collection of novel data-mined polypeptides and proteins to Serono SA, of Geneva, which has an option to obtain an exclusive license to develop them further. Under its own steam, it has commenced a large-scale study of cerebrospinal fluid in order to identify proteins and peptides linked to degenerative and vascular dementias, particularly Alzheimer's disease.
In the current environment, however, the company is finding it difficult to land more deals. "We are feeling the impact of the current economic situation on research and investments in biotechnology, which are suffering a marked slowdown," CEO Bertrand Damour said in a company statement.
Chris Redhead, a London-based biotechnology analyst at WestLB Panmure, said pharmaceutical firms are now saturated with targets. "Clearly, protein targets will always be important for drug development. The question is, how many targets do pharmaceutical companies want? You get the sense that they're drowning in targets at the moment," he said.
The deal flow for listed European companies engaged in proteomics, such as Oxford GlycoSciences plc, of Abingdon, UK, and GPC Biotech AG, of Munich, Germany, has been poor. "Clearly from a research point of view, proteomics is always going to be important," Redhead said. "The present commercial value of that is questionable.
"What's going to give you the value is the smart approach," he said, citing GPC Biotech's pilot deal involving its LeadCode drug-target interaction screening technology with Eli Lilly and Co., of Indianapolis, as an example. Redhead also identified UK firm Proteome Sciences plc, of Cobham, Surrey, which has developed "Sensitizer" technology, which, it claims, delivers a 100-fold improvement in the sensitivity of mass spectrometers, as another proteomics firm with an attractive strategy. It has a virtual structure and a low cash burn, yet has entered two deals since December.
GeneProt officials could not be reached for comment.