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GenTel acquires GlaxoSmithKline chip platform

Fitchburg, Wis. - Alex Vodenlich believes his life-science company, GenTel BioSciences, has taken a major step with the acquisition of a protein chip platform from GlaxoSmithKline, but just how major could depend on the degree to which the technology improves the quality of data GenTel delivers to customers.

GenTel, which has developed a protein chip used by cancer researchers, announced the acquisition during an open house at its new facility in the Fitchburg Technology Campus.

Vodenlich, president and CEO of GenTel, said the company has moved to the front ranks of life-science service providers in one fell swoop. “It basically accelerates what we're doing by many fold,” he stated.

Terms of the transaction were not disclosed. As part of the acquisition, GenTel has added two former GlaxoSmithKline employees to its staff, and they will be based at Research Triangle Park in North Carolina.

A real coup
Last month, GenTel announced that it had raised an additional $500,000 in venture capital to pursue a transaction with a large pharmaceutical company, but until now it has declined to identify the company. The funding commitment brings to $2 million the total amount of financing GenTel has raised, the bulk of it coming from two Wisconsin investor organizations, the Appleton-based NEW Capital Fund, and Wisconsin Investment Partners of Madison.

GenTel, formed in 2000, expects the newly acquired platform to strengthen its position in the multiplex immunoassay market. The term multiplex refers to the fact the assays, or tests, can perform multiple quantitative measurements on each biological sample, improving cost effectiveness, reducing specimen consumption, and producing additional data.

Vodenlich said it would have taken GenTel a long time to duplicate the protein chip platform it purchased from GlaxoSmithKline. The platform integrates instruments, web-based software applications, and statistical tools that will enable GenTel to design and screen protein arrays, and analyze multiplex protein micro arrays. He said GenTel's customer base, including large pharmaceutical firms, now will rely on the company for a greater variety of services, including the screening of pre-clinical and clinical samples.

GenTel's association with GlaxoSmithKline began roughly two years ago, when the pharma company began to supply GenTel's protein array slides. On metrics like data quality and reproducibility, Vodenlich said GenTel's slide worked best within GlaxoSmithKline's system, so when the pharma giant decided to reorganize its technology development group and shed the protein chip technology platform, GenTel was interested.

Vodenlich isn't the only person who is bullish on the purchase of the protein chip platform. Paul Domanico, former vice president of U.S. technology development for GlaxoSmithKlein, and now president of his own consulting firm in Durham, N.C., said the protein chip platform will give GenTel a complete set of capabilities for the development of protein biomarker applications. These applications have the potential to improve the understanding of disease.

Domanico isn't surprised that a major pharmaceutical firm would shed a technology asset. Increasingly, these companies have been selling off such assets to focus on their core business of drug discovery.

“There are very few ramifications for a pharmaceutical company to sell off a technology platform,” Domanico said. “This is the most common approach when the information from a platform yields long-term competitive advantage, yet the platform itself would yield only a short-term competitive advantage to pharma.”

Carolina connection

In conjunction with the acquisition, GenTel has added to its staff Dr. Anna Astriab-Fisher, who will serve as vice president of assay development, and Bryan Reep, who brings expertise in the production of arrays. Assays are procedures in which the properties of an object are measured; arrays are genetic tools used to detect variations in DNA and susceptibility to disease, and measure the efficacy of drug therapies.

Astriab-Fisher, who is among those who developed some of the applications purchased by GenTel, and Reep will be based at a facility in Research Triangle Park in North Carolina. Vodenlich said the North Carolina location, which is in close proximity to several major research universities, will serve as a research center for protein array development, while the manufacturing function will be centered in Fitchburg.

GenTel, which employs 16 people at its Wisconsin facility, has been doubling its revenue on an annual basis, Vodenlich said, and he expects that trend to continue. Even though part of the protein chip platform is automated, Vodenlich plans to add two to four workers in 2007, and increase the company headcount by 20 to 30 percent annually.

Part of his calculation is the market position made possible by the platform, which gives GenTel a chance to land screening deals in the $1 million to $3 million range.

According to Vodenlich, the acquisition is not part of a screening agreement, but with the platform, GenTel is in a better position to compete for lucrative drug-screening contracts with GlaxoSmithKline and other major pharma companies.

“Now we have experienced skill sets and a platform to go out and get that business,” he said.

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