It used to take weeks of labor for a drug company to make a batch of genes for an experiment. Those days are fading, as Blue Heron Biotechnology of Bothell, WA, and an emerging group of competitors have found ways to pump out industrial quantities of custom-manufactured genes, cheaper and faster than before.
The market for custom-ordered building blocks of life has grown from virtually zero in Blue Heron’s founding days of 1999 to an estimated $60 million this year and growing, said John Mulligan, the company’s founder, chairman and chief scientific officer. The price per base pair, or chemical unit of DNA, has plummeted to about a tenth of what it was then, meaning it is now cheaper for drug companies to order manufactured genes than assign the task of making them to young scientists, said Joe Piper, managing director of Integra Ventures in Seattle, and a director of Blue Heron.
The trend has made it possible for large drugmakers to run all sorts of industrial-scale experiments that weren’t feasible before, Mulligan said. Demand has surged to the point where Blue Heron counts 19 of the world’s 20 largest pharmaceutical companies as customers. Unwieldy genes with as many as 50,000 chemical units of DNA (more than most any biologist needs) can now be custom made, error-free. After surviving some manufacturing snags a couple years ago, Blue Heron can now deliver an average order within two to four weeks.
“It’s a real business now,” Piper said. “Early on, you had to wonder if there was demand.”
Besides Blue Heron, Germany-based GeneArt, DNA2.0 of Menlo Park, CA, and at least until recently, Codon Devices of Cambridge, MA, have emerged as leaders among at least 40 companies offering the service, Mulligan said. The companies offer a way for large drugmakers (think Merck and Pfizer, although no one’s saying for sure) to buy large quantities of genes with slight variations, so they can run vast experiments to see which of their drug candidates ought to work best.
The demand has surged so much that the manufacturers have struggled to keep up. About two years ago, Blue Heron’s orders more than doubled on a monthly basis, Piper said. That led to some struggles to keep up with demand, which have since been resolved, Mulligan said.
Growth, and growing pains, aren’t just happening at Blue Heron. More recently, Codon Devices was hit with a spike in demand that it couldn’t handle from September 2007 to February 2008, says Mulligan, whose company received some customer referrals as a result. (Codon said last week it is switching its strategy to concentrate more on synthetic biology, constructing new biological products potentially for uses like cleaning up oil spills.)
GeneArt, the German competitor, has done well enough to go public in Germany and hire 190 employees. Thanks in part to a big contract signed with the U.S. National Institutes of Health, based in Bethesda, MD, GeneArt said its sales surged 61 percent in the first quarter. It expects 2008 sales of $16.5 million to $18 million Euros ($25.6 million to $28 million at current exchange rates).
The better/faster/cheaper evolution of custom gene manufacturing opens the door to making all sorts of biological organisms that don’t exist now, hence the term “synthetic biology.” J. Craig Venter, the human genomics pioneer, has talked publicly about his desire to someday synthesize entirely new organisms that might be able to clean up environmental pollutants or become renewable energy sources.
At least for today, it’s more likely that what a drug company would want from gene manufacturer like Blue Heron is many copies of genes with slight variations that would enable massively parallel experiments that could help explain, for instance, why some patients respond to a drug while others don’t. If scientists can know that ahead of time, their success rate for developing new medicines would go way up.
That’s a critical need in the pharmaceutical industry, where only 1 out of 10 drugs that enters clinical trials ever survives to become a marketed product.
“We’re seeing people tackle projects in new ways with the industrialization of molecular biology,” Mulligan said. “People are tackling research in a more rational, compelling way.”
For the sake of everyone who wants new therapies, especially patients and investors, let’s hope the industrialization of molecular biology will help drugmakers raise their batting average.
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