WASHINGTON, D.C., Aug. 1, 2001 - Over the past year, several new developments have fueled excitement over bioinformatics. The emerging field has since propelled a host of new business, academic and economic-development initiatives in the region. And it's one of the few technology sectors still winning favor with investors.
The researchers are drowning in data right now," said Greg DuPertuis, co-founder and president of Adrenaline Group, a Washington technology consulting firm. "There are opportunities for companies that believe they have better ways to mine this data."
Bioinformatics is big not just because it represents a way to put computer whizzes to work but also because many companies believe the technology could give them the edge in bringing profitable new drugs to market.
"Bioinformatics has become the driver behind becoming more competitive in this discovery area," said Wei-Wu He, a partner of Emerging Technology Partners, a Rockville venture capital firm that invests in biotechnology companies. "The people who have bioinformatics tools have an advantage over people who don't."
The market for bioinformatics products is projected to reach $11.5 billion by 2004, according to IDC, a Massachusetts-based technology industry analyst group.
It remains to be seen whether the bioinformatics sector can deliver on its promises, and questions persist: Is it an industry with long-term prospects or the just latest business fad? But whatever its future, many in the region's technology community are betting on it.
Over the past year, several new developments have fueled excitement over bioinformatics. The sequencing of the human genetic code signaled a new era in medical research. Virginia Tech launched the Virginia Bioinformatics Institute in Blacksburg with substantial state backing. The Chevy Chase-based Howard Hughes Medical Institute, one of the world's premier research organizations, announced plans to build a $500 million research campus focused on bioinformatics in Loudoun County.
The emerging field has since propelled a host of new business, academic and economic-development initiatives in the region. And it's one of the few technology sectors still winning favor with investors.
In a bleak financing climate, local bioinformatics companies are striking deals. In April, International Business Machines Corp. agreed to invest an undisclosed sum in LabBook Inc., a McLean start-up that is developing a browser for genetic research. And in June, Viaken Systems Inc., a Gaithersburg provider of information-management services to biotech companies, raised $13 million in its second round of venture capital funding.
"Over the past couple months, I've heard the bioinformatics area is one of the few areas venture capitalists are interested in," said Keith Elliston, Viaken's president and chief executive, who founded the company two years ago. "It's a very big, growing area with lots of dollars."
And local firms that rode the Internet wave have started launching their own bioinformatics initiatives. In July, Adrenaline Group, known for its software development and Web expertise, announced it would team up with Baltimore-based BioMedical Sciences Group to offer a new service to evaluate bioinformatics investments.
"We've been looking at how the needs of the greater biotechnology community intersect with the technology industry we're part of," DuPertuis said.
Meanwhile, DuPertuis, Elliston and other local tech professionals recently formed the Regional Bioinformatics Coalition, an industry group that seeks to promote the growth of bioinformatics in the Washington area.
"The region has really strong potential to develop this field," Elliston said. "It has a strong biotechnology industry in Maryland and a strong IT industry in Virginia and D.C. And bioinformatics really knits those industries together."
Efforts are underway to create this new generation of bioinformatics companies. Fairfax County officials recently approved funding to build an incubator to nurture such start-ups. And two business groups, 270 Tech and ATC Group, just announced plans to develop a bioinformatics incubator in Montgomery County.
Local venture capitalists say they've seen a spike in the number of business plans from bioinformatics firms. Wei-Wu He of Emerging Technology Partners said he has seen at least 100 business plans from such companies over the past year.
"After the Human Genome Project, people realized it's one thing to create all this data, it's another to truly understand and use it," he said. "People suddenly realize they just can't live without this discipline."
July 31, 2001