Biotech/Pharmaceuticals
With Genome Complete, Myriad Allies With Others to Pursue Proteins
Adam Feuerstein
04/04/01 - 03:39 PM EDT
Myriad Genetics (MYGN Quote - Cramer on MYGN - Stock Picks), Hitachi (HIT Quote - Cramer on HIT - Stock Picks) and Oracle (ORCL Quote - Cramer on ORCL - Stock Picks) are forming an alliance to create a complete database of human proteins in three years. The partnership, valued by the companies at $185 million, combines Myriad's expertise in protein research with computer hardware from Hitachi and software from Oracle. Friedli Corporate Finance, a Swiss investment bank, is also backing the venture, which intends to sell database information to pharmaceutical and biotech companies. Human protein research -- known as proteomics -- is considered the next great biotechnology quest after the mapping of the human genome. Proteins are the complicated mixtures of amino acids that regulate many of the body's functions. Genes carry a person's genetic blueprint, including instructions for how proteins carry out activities in human cells. By understanding the form and function of proteins and how they affect the human body, researchers hope to identify targets to cure disease or prevent disease altogether. The quest to create a database of human proteins, however, is very complicated. While there are thought to be 30,000 human genes, there are possibly 10 times more proteins. And each protein's makeup is a lot more complicated to decipher, which requires an enormous amount of computing power. "This year's frenzy over proteomics is last year's genomics," says John McCamant, editor of the Medical Technology Stock Letter. "It's not enough to create a protein database; it's the business model you create with that database." McCamant believes companies like Myriad can make a decent business from licensing a protein database to drug makers, but the bigger pot of gold is in actually identifying disease targets, then developing drugs to counter them. (McCamant has no position in Myriad.) Several other ventures have already announced their intention to create human protein databases, including acclaimed gene mapper Celera Genomics (CRA Quote - Cramer on CRA - Stock Picks), which is teaming with Compaq(CPQ Quote - Cramer on CPQ - Stock Picks) and the Energy Department. Last year, IBM(IBM Quote - Cramer on IBM - Stock Picks) said it was teaming up with proteomic researchers to build a new supercomputer dubbed Blue Gene. In recent trading, Myriad shares were off $1.94, or 6%, to $32.06. Oracle was up 49 cents to $13.74; Hitachi was down 14 cents to $83.26.