Promise of Tomorrow: Biotech’s Next Hot Companies By CARLOS MARTINEZ Staff Reporter Scores of biotech firms in the San Fernando Valley are in the midst of developing new therapies and medical devices, but only a handful are likely to see their products come to market anytime soon. While Southern California is filled with biomedical expertise, given the proximity to UCLA, USC and Caltech, it has not received the venture capital that has poured into Silicon Valley or San Diego, said Ahmed Enany, executive director of the Southern California Biomedical Council. “You see funding, but it’s not comparable to these other places, and a lot of it goes not to traditional biotechs that deal in biology, but companies that make medical devices,” he said. Despite the success of Amgen, the 101 Corridor’s oldest and most prosperous biotech, it has not been the runaway biotech hub many had expected, local experts say. Partly because Amgen has not spawned spinoffs in the way large pioneering companies in other areas have, the 101 Corridor has not garnered the attention of venture capitalists who have fueled biotech growth elsewhere, Enany said. “You’re just not getting that ‘critical mass’ that biotechs talk about in terms of getting that important VC interest,” said Gary Clark, president of the non-profit Ventura County Biotechnology Institute. Funding issues have left a number of biotech startups by the wayside in recent years, but some are poised to make their bid to perhaps become the next Amgen, Clark said. Here are a few of the companies that could gain a higher profile in the next few years. Solgene Therapeutics This Westlake Village-based biotech firm hopes to make a bundle with its drug delivery system that encapsulates living cells and releases them much as they would be released by the body naturally. Solgene CEO Edward Pope said the system is ideal for delivering insulin and bone growth cells to reduce the impact of osteoporosis and arthritis. Ahmed Enany, executive director of the Southern California Biomedical Council, said the technology offers potential for the company, which is struggling with funding at the moment. “They have something that could eliminate the symptoms of diabetes and that has very real possibilities,” he said. Solgene is currently on a capital drive to raise the $6 million needed to begin clinical trials for a product that could be in the market in seven to eight years, Pope said. Estimated revenue for the product could reach $5 million its first year, double that in succeeding years, Pope said. AlleCure Corp. The Valencia-based biotech bankrolled by Alfred E. Mann, founder of MiniMed, is developing allergy vaccines that its managers say could make asthma a thing of the past. Enany said the company’s research into these vaccines will prove immensely profitable once they reach the market. “Allergies are a big market and, if you have a vaccine that addresses that market, it will become huge. There’s no question,” he said. The two-year-old company receives its funding, an undisclosed amount, from Mann’s MannKind Corp. Although AlleCure won’t estimate how much its technology would be worth once its products hit the market, Enany said it would be in the “hundreds of millions” of dollars. Second Sight Inc. The year-old company is developing eye implants that connect a video camera to the patient’s optic nerve, giving sight to those for whom other therapies do not work. Gary Clark, president of the non-profit Ventura County Biotechnology Institute, said the company’s technology is unique in its application for blind patients. “There’s nobody else out there doing that, so it’s a wide open market for them,” Clark said. The company received a $12.5 million grant in 2000 from the National Healthcare Institute, but its general funding comes from Alfred E. Mann’s MannKind Corp. Second Sight CEO Robert Greenberg said the company anticipates the implants will be available within five years, with “high revenues” expected in the first year, but he would not elaborate further. Greenberg estimated there are 3 million patients around the world that could benefit from the implants. ZLB BioPlasma Inc. Blood and its related products are what make this year-old company go. Bankrolled by Australian and Swiss investors, the Glendale-based firm hopes to make a serious bid at being a major provider of blood products to the nation’s labs and blood banks after acquiring blood labs in the Midwest and Nevada. Although its financing remains confidential, ZLB president Pete DeHart said ZLB hopes to service the growing market of immune-based therapies and services. Richard White, manager of White Associates Investment Fund, said in a few years the company could be ready to take over a large segment of a market served by scores of smaller labs dealing in human plasma. “They’re very aggressive in their strategy and it looks like it will pay off,” he said. Advanced Biotherapy Inc. Already conducting clinical trials, the Woodland Hills-based biotech is looking at marketing its biologically engineered interferon-gamma antibodies for therapies that would treat several diseases, including rheumatoid arthritis. Advanced Biotherapy president Edmond Buccalletto said the company is developing therapies for the newly patented antibodies, but also is looking to license it. “We’re looking at a market that is in the tens of millions, so it’s difficult to say how much this is worth down the road,” he said. The antibodies would also treat multiple sclerosis, juvenile rheumatoid arthritis, psoriatic arthritis and Ankylosing Spondylitis, a condition that causes curvature of the spine. But the company warned that it would be five to eight years before the product comes to market. “There are always ifs, so if this product works like they say it does, then it could be really big,” said Brent Reinke, managing director of Crosby Heafey. Aperio Technologies Inc. A medical device maker in Thousand Oaks, this company is already making a push for its proprietary slide-scanning equipment that allows microscope slides to be scanned and digitized with high-resolution images. The two-year-old company developed specialized computer programs that can be applied to its slide scanners, allowing scientists access to and retrieval of slides remotely. The company has begun marketing its technology and is developing other related applications, but the privately held firm would not disclose its financial targets or funding. Richard White, manager of White Associates Investment Fund, said the firm’s technology is getting attention from labs and other biotechs, and could take off once it gains wider acceptance.
