DNA Alley

By Carole Buia

Like California's Silicon Valley and Massachusetts' Route 128, Montgomery County, Md., has been transformed in the past decade from a sleepy suburb into a bustling scientific Mecca. The 15-mile stretch of Interstate 270 that runs from Bethesda to Gaithersburg now houses one of the world's largest and smartest collections of genomic firms. The chief draw is the NIH, which dispenses $14 billion a year in research grants. But there are other attractions--proximity to Johns Hopkins, a start-up-friendly local government, an abundance of office space; and most of all, a critical mass of like-minded scientist-entrepreneurs determined to unravel the secrets of the genome and spin them into gold.

--By Carole Buia

1 GENOMICS FUND.COM PORTFOLIO MANAGER: Steve Newby LAUNCHED: March 2000 NET ASSETS: $25 million WHAT IT DOES: Runs the only mutual fund that invests exclusively in genomics

As bad luck would have it, Newby launched the market's first genomics fund (symbol: GENEX) in March, only a few weeks before the NASDAQ--led by high-flying Celera--got hammered.

2 GENE LOGIC INC. PRESIDENT AND CEO: Mark D. Gessler FOUNDED: November 1994 EMPLOYEES: 250 WHAT IT DOES: Builds custom and nonproprietary gene-expression databases

A reseller of genetic information, Gene Logic offers as its main product the GeneExpress reference database, which shows which genes are over- or under-expressed in various diseases ranging from heart failure to cancer. Gene Logic gathers and packages the data and sells it to biotech and pharmaceutical companies.

3 HUMAN GENOME SCIENCES CHAIRMAN AND CEO: William A. Haseltine FOUNDED: July 1992 NUMBER OF EMPLOYEES: 650 WHAT IT DOES: Patents genes and develops proprietary gene-based drugs

HGS was founded as a partnership between Venter and Haseltine to exploit the research coming out of TIGR, but the two parted ways in 1997. The company today holds U.S. patents on 159 genes and has four genomic compounds in clinical trials. These include a drug that curbs the toxic effects of chemotherapy and a drug that promotes wound healing.

4 THE INSTITUTE FOR GENOMIC RESEARCH PRESIDENT: Claire Fraser FOUNDED: July 1992 EMPLOYEES: 230 WHAT IT DOES: Genomics research on a not-for-profit basis Started by Venter after he left the NIH, this outfit is the mother of Celera. Run now by his wife, Claire Fraser (Venter serves as chairman of the board), it claims credit for identifying many of the human genes used in research today. TIGR (pronounced Tiger) now concentrates on microbial and plant genomic research, the results of which it publishes free on its website: www.tigr.org

5 FBR EMERGING TECH PARTNERS KEY OFFICERS: Wei-Wu He, William F. Snider, Emanuel J. Friedman FOUNDED: September 2000 FUND SIZE: $40 million WHAT IT DOES: Venture-capital fund that invests in local genomics firms

Since it was launched last fall, the first genomics venture-capital fund for DNA Alley has invested in six companies, one of which, Informax, went public in October.

6 NATIONAL INSTITUTES OF HEALTH ACTING DIRECTOR: Dr. Ruth Kirschstein FOUNDED: 1887 EMPLOYEES: 16,000 WHAT IT DOES: Conducts and funds medical research for the U.S. government

The Bethesda-based campus of the NIH houses the world's foremost medical-research center. It consists of 26 institutes and centers, including the Genome Institute--Celera's fiercest competitor--led by Francis Collins. The NIH's research is deep in scientific expertise and wide in scope, from uncovering the genetic roots of the rarest cancers to understanding the molecular basis of the common cold. Venter got his start here, bringing both glory and controversy to the Institutes during eight stormy years.

7 CELERA PRESIDENT: J. Craig Venter FOUNDED: May 1998 EMPLOYEES: 741 WHAT IT DOES: Maps genomes and sells access to its rapidly growing databases

After several pit stops along the Rockville-Bethesda corridor, Venter established his brainchild--Celera--in Rockville. Here he built the world's largest collection of genome-sequencing computers and won the race to map the 3 billion letters of human DNA (as well as the genomes of several other species). But with the NIH's Human Genome Project publishing much of the same data free on its website, Venter must now convince corporate customers that his DNA maps are more accurate and his proprietary software tools indispensable.

8 FOOD AND DRUG ADMINISTRATION COMMISSIONER: Jane Henney FOUNDED: 1927 EMPLOYEES: 9,000 WHAT IT DOES: Inspects, approves and sets safety standards for foods and drugs

The final hurdles before any new drug--conventional or genomic--can come to market are the FDA's extensive testing procedures for safety and efficacy, which can take up to 15 years. Despite recent well-publicized recalls, the agency's rigorous standards and safety record are the envy of the industrialized world.