29 Nov DNASTAR catches second wave of sequencing
Madison, Wis. – The origins of Madison’s technology industry can be traced back much farther than 1982, but Fred Blattner felt pretty isolated when he opened DNASTAR, Inc. that year.
Other than another young company – an upstart called Promega – and a few more, the producer of DNA analysis software was in need of companionship. The early 1980s was an era where it was considered bad form – even a social stigma – for an academician like Blattner to start a business. The dominant perception was that research and development was a “big company” function.
“We were among the first five or 10 [technology] companies getting off the ground at that time,” said Blattner, a genetics professor at the University of Wisconsin-Madison and CEO of DNASTAR. “We were pretty lonely.”
Amid the solitude, Blattner wanted to take advantage of the expanding knowledge of DNA. He launched DNASTAR in his basement with the help of an SBIR grant and then UW-Madison undergrad John Schroeder, now the company’s vice president of R&D.
Blattner was among the first professors on the UW campus to conduct DNA sequencing. Even nationally, he was part of a small universe, but since it was impossible for anyone to scan volumes of genomic data with the naked eye, there was strong demand for analysis software.
Unfortunately for DNASTAR, the weak link in the sales process was the fact that Apple was still largely a gleam in someone’s eye. Since it was developing software before there were computers that could run it, the company had to build the computers and sell the software and computer in a bundle, but that didn’t stop Blattner from mowing a different landscape. Little by little, the personal computer would begin to proliferate in research labs and businesses, and he would be joined by other university professors who discovered a market for their research tools.
And now, with a revolution underway in structural biology and its 25th anniversary approaching, DNASTAR still offers DNA sequencing, which permits a more in-depth analysis of genes, and has moved into database searching and micro arrays.
“They were one of the early leaders in bioinformatics and in assisting researchers with tools,” said Jim Leonhart, executive vice president of the Wisconsin Biotechnology and Medical Device Association. “They are now quite a major player around the world.”
The convergence of life science and high-volume computing means that data integration is the name of the game for researchers. As the quality of data and computing increases, the task of cross referencing, comparing, and pinpointing data becomes more difficult, and the need to develop next-generation sequencing technology continues to spell opportunity for DNASTAR.
In the four weeks since introducing SeqMan Pro, an enhancement of DNASTAR’s Lasergene sequencing software, customers already are asking – in the hope of pushing limits – how much genome can be assembled on a desktop computer?
“In the first era of DNA sequencing, companies would be happy to get five to six times [the coverage] for $1 to $2 million,” Blattner said. “Now, you can get 100 times for about $10,000.”
Driving down costs and covering more genome is only one of the challenges faced by DNASTAR’s 30 employees. For the sake of product interoperability, they also must keep up with advances in desktop operating systems and other technologies. Company management believes it has a competitive advantage with its ability to read both the Sanger method for DNA sequencing and new sequencing technologies.
DNASTAR does not release information on its finances, but general manager Tom Schwei maintains the company has been consistently profitable. Its clientele includes three of the America’s top five pharmaceutical companies, plus several prominent research institutions, including Cornell University and Washington University in St. Louis. Although two-thirds of it customers are in the U.S., the company has clients in more than 65 countries.
Blattner has expanded internationally while avoiding venture investors. Although DNASTAR has received numerous government grants, it hasn’t taken the venture capital route, and the lack of media splash that usually comes with attracting equity funding has contributed to a somewhat underappreciated role in genomics – at least among the general public.
“People inside the industry know them just because they have made work a lot easier for biotechnology companies and pharmaceutical companies,” Leonhart said.
“Fred hasn’t gone out and raised a lot of money,” Schwei added. “He puts his own money into things, and he has been patient in developing them.”
Blattner’s sequencing work on a laboratory workhorse called E.coli – only a few E.coli strains are life-threatening – has led to the discovery of 100 different genomes for E.coli. He started Scarab Genomics, which has developed what it calls Clean Genome E.coli for use on industrial fermentation, and he was involved in the founding of the Madison genomics firm NimbleGen.
With reluctance, Blattner concedes that he is a serial entrepreneur, the kind that starts multiple companies and helps create the critical mass of technology businesses that every chamber of commerce craves. However, he’s also quick to share the credit with supporting institutions like the Wisconsin Alumni Research Foundation and the law that states computing power doubles every 18 months.
“On the whole, it’s been interesting to ride on the whole Moore curve,” Blattner said, referring to the technology adoption life cycle articulated by author Geoffrey Moore.
Blattner marvels at how far genomics has come. While the latter part of the 20th century became “the age of DNA,” Blattner recalls that when he started graduate school in 1962, there was still some question as to whether DNA actually was a hereditary substance and how important it really was.
He also marvels at the company DNASTAR now has in the Madison technology and biotechnology communities, which he said has gone from fertile to extremely fertile. “I was blessed to be in Madison, where the soil was pretty fertile to begin with,” Blattner stated. “Now, it’s positively alluvial.”
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