Company Moves: ORC Buys; PLS Sells

Princeton Softech Acquires SELECT

New in Town

Crosstown Moves

Contracts Awarded

Management Moves

Deaths

Corrections or additions?

These articles were published in U.S. 1 Newspaper on June 2, 1999.

All rights reserved.

Life in the Fast Lane: Compugen

Scientists on the cusp of this century who are trying

to develop therapies from genomic and protein sequences can be likened

to the gold miners of the 19th century. They each must sift through

the mud and water for countless hours before finding the gold. For

the ’49ers, it was nuggets of metal; for scientists it is useful sequences

of DNA and proteins.

But unlike the miners, today’s gold diggers have the tool of bioinformatics

to help them shovel, sift, and determine what’s gold.

One company with a high-tech sieve is Israel’s Compugen, which has

recently moved into the Exit 8A area to set up a secondary research

and development home. Compugen’s use of bioinformatics is the sieve

with the ability to analyze gene sequences thousands-folds faster

than through traditional laboratory screening and other analysis methods

and products.

"Bioinformatics is the application of computer technology in order

to model and understand the molecular mechanisms of life," says

Simchon Faigler, one of the founders of Compugen and the vice president

of technology. He sees Compugen’s place in the pharmaceutical field

as using bioinformatics to convert the ever-increasing pool of genetic

data from raw material into meaningful information. The ultimate goal

is to pave the way for cures and therapies.

"Our customers are looking for genes that have some effect on

specific pathologies or diseases," says Faigler. The key to Compugen’s

speed is algorithms, or mathematical formulas, that dictate how the

computer hunts for similarities between sequences and how it identifies

a match. "Sequences are small pieces of a very large puzzle,"

says Faigler. "Our program tries to assemble them together to

build up a bigger picture."

The algorithms Compugen has embedded in its products increase the

speed at which meaningful information can be extracted from genomic

and protein sequence data, accelerating the discovery of new drug

targets. By using its own technology, Compugen researchers have been

able to identify over 3,000 genes that were previously unknown. They

used standard experimental methods to estimate that more than 90 percent

of these new gene forms (more than 2,700 genes) are real — they

are in present in human cells.

The company has reached significant milestones in its short history.

Last year Compugen won a contract from the U.S. Patent and Trademark

Office to supply software and hardware for examining biological patent

applications and accelerating the approval process. Compugen’s products

will analyze the extensive protein and DNA sequence data being submitted

in the patent applications.

Another coup happened last October, when the company signed a three

year, multimillion dollar collaboration with Parke-Davis for the LEADS

drug target discovery platform. This platform addresses two problems

facing researchers today. "It takes all known data and clusters

this data together, solving the puzzle of how to build genes out of

the fractional data available right now," says Faigler. "Then,

out of these genes that we built, we can fish out those that might

be useful to the life science or the pharmaceutical researchers."

Compugen has also finished its fourth round of financing. "Each

round was bigger," says Faigler. Far from the seed capital of

$100,000 per year Compugen received in 1993, the end of 1998 saw the

close of a $15 million equity private placement. Clal Biotechnologies

Industries, one of Israel’s investment firms, led the financing. Other

financiers of this round include Hapoalim Investments, Ampal, Evergreen

Funds, and Cayrex Private Equity.

When the company began, its one financial supporter was the Israeli

government, which granted seed money and a place to work — in

the Negev desert town of Sde-Boker. The company recently moved to

the metropolitan Tel Aviv. And despite the office in New Jersey, Compugen

has no plans to sell itself off to American bidders like some Israeli

companies are doing. "I don’t think we’ll even consider it,"

says Faigler.

All the money made by the company is being invested back into research

and development. It has not recorded any profits in six years, and

a rough estimate by Faigler predicts five more profitless years.

Compugen and the field of bioinformatics have grown with the expectation

that new drugs and therapies will be derived from information gleaned

from the blueprint of the human genome. With only a fraction of the

100,000 human genes already discovered, the database of information

is massive and the challenge is picking out the useful information

from the junk.

The company’s first product — the Bioaccelerator — was a piece

of specialized hardware that attached to a workstation and could accelerate

certain analysis software by three orders of magnitude. Since then

the company has developed the BioXL which is even faster than the

Bioaccelerator.

Customers came soon after the products were offered. Merck bought

the first Compugen machine (slightly larger than a personal computer)

in 1994 and has since bought two more, at about $200,000 each.

In 1995 the company began to market GenCore software, the first sequence

analysis package designed for high throughput environments — where

thousands of genes and other biological sequences are analyzed daily.

The software, packaged with the company accelerators, has become the

de facto standard for high throughput sequence analysis, says Faigler.

Compugen is selling the acceleration hardware and software products

to an impressive array of big pharmas and smaller firms. In addition

to Parke Davis and Merck, the clients include SmithKline Beecham,

Amgen, Eli Lilly, Bayer, Wyeth Ayerst, Human Genome Sciences, Incyte

Pharmaceuticals, and Millennium Pharmaceuticals. Collaborators include

Parke-Davis, EBI (in the United Kingdom), the Sanger Centre (UK),

and the Weizmann Institute in Israel.

As far as competition goes, no one comes close to providing what Compugen

does, says Faigler. But to evaluate his claim one must step back to

look at the contenders in the various contests:

In one arena the government-funded Human Genome Project (HGP)

is battling it out with entrepreneur Craig Venter of P.E. Celera to

try to sequence the complete human DNA located in the 23 chromosomes.

Scientists believe there are between 100,000 and 150,000 human genes

embedded within those chromosomes.

"They are trying to measure the sequences at the DNA level, the

home of the chromosomes, trying to extract the DNA code from the 23

pairs of chromosomes present in every human cell," says Faigler.

"After they finish doing it all the raw data of the human genome

will be known." The government-funded method has the reputation

of being more accurate but significantly slower. Scientists claim

Venter’s method is risky, but if he succeeds he will have the data

before it enters the public domain.

In another arena the Institute of Genomic Research (TIGR) in

Rockville, Maryland, and NIH’s National Center for Biotechnology Information

have built gene databases out of available data. The NIH database

is called Unigene.

A quick tutorial: DNA (in the nucleus of the cell) is the template

that generates the RNA. The RNAs, in turn, are translated into mature

RNAs (MRNAs) which in turn are translated into proteins, which do

the actual work. Random short samples of MRNA (very close to the proteins

themselves) are called ESTs or expressed sequence tags. These ESTs

are the most popular subject for current research.

Faigler says that TIGR and NCBI are using only the ESTs for their

input data. In contrast, Compugen works with almost all of the available

public data: ESTs, MRNAs, and the actual DNA. "We are taking all

the known data including the genomic data from the HGP project and

analyzing it together," says Faigler.

Compugen’s analysis is superior, Faigler says, "because the quality

and level of pharmaceutically relevant information that you can extract

from this data is higher than the raw data itself." He also says

Compugen has better modeling of the biological processes that generate

the data. "We can reverse-build the pieces of the puzzle and get

more accurate results."

"We build genes out of this data," says Faigler, "and

genes and the function of genes are what people are looking for."

Sometimes fate brings people together and sometimes

it’s mandated military service. The latter was the case for the three

founders of Compugen, who formed their company in 1993 after each

had finished serving for the Israeli army. Eli Mintz, Amir Natan,

and Simchon Faigler took their studies of math, science and computers

into the field of bioinformatics.

Mintz, the CEO and president, developed algorithms and wrote and managed

software for Israel Aircraft Industries’ Mabat subsidiary. Natan,

VP of software, developed algorithms and signal processing software

at Rafael, the National Armaments Development Authority. Both are

still in Israel.

Simchon Faigler moved to the U.S. in September. Faigler, along with

the others, studied at the Hebrew University where he earned a BA

in physics and mathematics. He spent the rest of his time there in

the communications division, in development of rapid hardware for

smart communication systems. After a year as an independent consultant

for the defense industry, he joined his army colleagues to start a

company outside the area of defense. He currently lives in Edison

with his wife, Ruth, an accountant, and their son and daughter.

The Israeli company is closing its first U.S. branch, in Woburn, just

outside Boston. Sales and customer support staff from that office

will move to Exit 8A, along with new hires and employees from Russia

and Israel. In two months the Exit 8A office will have 13 employers;

it will expand its R&D efforts and continue to support partners and

customers in the area. Compugen has grown to nearly 100 employees

worldwide.

"Our object in the future is to concentrate on big customers —

the 50 large pharmaceuticals," says Faigler. "New Jersey is

a very good place to be."

— Monika J. Guendner

Compugen, 7 Centre Drive, Suite 7, Jamesburg 08831.

Simchon Faigler, VP, technology. 609-655-5105; fax, 609-655-5114.

Home page: http://www.cgen.com.

Millstone, Not!

Enough discussion, the Department of Transportation

is saying, about the Millstone Bypass. With or without the support

of Princeton Township and Borough, we’re going to build it. "After

working close to 20 years on this project we need to move forward.

Further analysis would not help the motorists on Route 1," says

DOT spokesman John Dourgarian, after a meeting last week on the $50

million project. "There is rarely a transportation project that

has unanimous support, but it was very clear that West Windsor, the

Princeton Chamber, Mercer County, Princeton University, Eden Institute,

and Sarnoff are all in strong support."

"Based on the fact that the project is entirely in West

Windsor, we should advance this project as fast we possibly can,"

says Dourgarian.

The process: a public information session this summer, environmental

assessment by fall, a public hearing in the fall, environmental review

by the Federal Highway Administration, final design, and property

acquisition. "We feel we can start construction in 2002 and complete

it in two years."

What will happen: A cloverleaf will be built at Route 1 and Harrison,

eliminating the traffic signals at Harrison and Washington and Fisher

Place. Eden will move nearby to new quarters built and funded by Princeton

University. The bypass road will start at the railroad bridge in Princeton

Junction, proceed through Sarnoff property and over the cloverleaf.

Motorists can either peel off at Harrison or continue along the canal

to turn right on Washington Road.

Opponents of the original plan can claim minor victories: The opportunity

to enter and leave Princeton under the archway of Washington Road’s

dramatic elms will be preserved, because Washington Road will remain

open for right turns on and off Route 1.

The bypass road was downgraded from 45 or 50 miles per hour to 40

miles per hour and will be posted at 35. Instead of coming within

350 feet from the Delaware & Raritan Canal, the closest point now

is 500 feet. A signal will disperse traffic at the point where the

bypass road intersects Washington Road.

What won’t happen: The Washington Road circle will not be replaced

by an underpass, nor will the bypass be extended from Washington Road

to Alexander Street.

— Barbara Fox

Top Of Page
Company Moves: ORC Buys; PLS Sells

Opinion Research Corporation International (ORCI),

3206 Route 206 and Orchard Road, Box 183, Princeton 08542-0183. John

Short, chairman and CEO. 908-281-5100; fax, 908-281-5105.

The company announced the acquisition of Macro International

Corp., another market research firm, for $28 million on Friday, May

28. This will nearly double the size of the 61 year-old firm, and

place it among the top 10 market research companies in the US. While

most Opinion Research clients are Fortune 500 corporations, most of

Macro’s business comes from government contracts. The acquisition

will mean Opinion Research will have offices in Europe, Latin America,

Asia and Africa, as well as the US.

The expansion comes on the heels of former CEO Michael Cooper’s resignation

in February. John F. Short, former chief financial officer, is now

both chairman and CEO.

Princeton Learning Systems Inc., 707 State Road,

Suite 212, Princeton 08540. William J. Healy, president. 609-924-2882;

fax, 609-924-5090. Home page: http://www.fsu.org.

Yipinet, a California-based Internet company, has bought

Princeton Learning Systems, and the two companies will merger their

online learning systems. Princeton Learning Systems was founded four

years ago (U.S. 1, November 25, 1998, and March 24, 1999) to design,

implement, and manage Internet and Intranet-based systems for training,

testing and regulatory compliance. Its core software product providing

access testing and reporting via the web, and its chief virtual product

is Financial Services University.

Yipinet is 18 months old, funded to the tune of $18.5 million, and

plans to go public this year. The Princeton branch of the company

will stay on State Road and retain its employees; William Healy will

stay with the new company and be president of PLS Services, and Steven

Haase will be vice president of sales and financial services.

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Princeton Softech Acquires SELECT

Princeton Softech (CHRZ), 1060 State Road, Princeton

08542-1423. Joseph A. Allegra, president. 609-497-0205; fax, 609-497-0302.

Home page: http://www.princetonsoftec.com.

Princeton Softech has bought SELECT Software Tools PLC,

which has a product line that meshes with Princeton Softech’s eData

distribution and management technologies — Object Oriented, Component-Based

Development products for developing and implementing Java and C++

eBusiness applications.

Princeton Softech has bought all the assets of SELECT, which will

continue its R&D activities at its current home office in Cheltenham,

England. Princeton Softech, a subsidiary of Computer Horizons Corp.,

has 110 employees on State Road. SELECT is also a public company (Nasdaq:

SLCTY).

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New in Town

TRISH USA Corp., 379 Princeton-Hightstown Road,

Building 1, Suite 3, East Windsor 08520. Shandy Amin, CEO. 609-371-5111.

Home page: http://www.trishusa.com.

TRISH USA Corp, a developer of workflow management and customer care

software, has opened an office on Princeton-Hightstown Road. The 10-year

old company moved from the Secaucus area. TRISH also has an office

in Brazil, where the majority of its clients are located.

The six-person staff on Princeton-Hightstown Road develops and customizes

software for clients including Lucent and Embertel.

Alpha Capital Corp., 379 Princeton-Hightstown Road,

Building 3, East Windsor 08520. Ragu Patel, managing director. 609-426-9002;

fax, 609-426-9069.

The Alpha Group, a boutique investment banking firm that specializes

in financial transactions for businesses with revenues between $100,000

and $25 million, has opened its third office at 379 Princeton-Hightstown

Road. The company also has locations in Woodbridge and Virginia.

Alpha Capital Corp., as the new branch is called, will focus on the

emerging technology sector companies, assisting them in fundraising,

business planning and preparation for IPO.

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Crosstown Moves

National Association of Scholars, 221 Witherspoon

Street, Princeton 08540. Stephen Balch, president. 609-683-7878; fax,

609-683-0316. Home page: http://www.nas.org.

The National Association of Scholars, founded in 1987, was scheduled

to move its headquarters from 575 Ewing Street to 221 Witherspoon

Street on Tuesday, June 1. Phone and fax numbers are the same.

King Interests Inc., 506 Carnegie Center, Princeton

08540. William F. King III, president. 609-951-6900; fax, 609-951-6935.

The real estate development firm moved from 504 Carnegie Center.

K&L Labs, 33 Wall Street, Princeton 08540. Lawrence

Fridkis, founder. 609-924-6880; fax, 609-924-6890. Home page: http://www.kllabs.com.

K&L Labs, a pre-press and offset printing firm, moved from Route 571

to 33 Wall Street. Phone and fax numbers are new.

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Contracts Awarded

PharmaSeq Inc., 11 Deer Park Drive, Princeton Corporate

Center, Suite 204, Monmouth Junction 08852. Wlodek Mandecki, president

and CEO. 732-355-0100; fax, 732-635-0428. Home page: http://www.pharmaseq.com.

PharmaSeq Inc. has signed an agreement with Sarnoff Corporation for

Sarnoff to design and make miniature micro-transponders that will

transmit the identity of DNA sequences coded into the transponders.

It also announced a $250,000 investment by the NJ Commission on Science

and Technology to commercialize light-powered micro-transponders in

a radio-frequency identification system.

The Women’s Law Project, 1908 Riverside Drive,

Trenton 08618. H. Joan Pennington, executive director. 609-394-1506;

fax, 609-394-2574.

The nonprofit organization providing sliding scale and pro bono legal

services has received a grant of $236,998 from the Office of Justice

Programs in the U.S. Department of Justice to expand its services

for domestic violence victims. The funds will be used to train and

appoint attorneys specializing in domestic violence in Mercer, Burlington,

and Ocean counties. Women’s Law Project (WLP) was founded in 1997,

under the aegis of the National Center for Protective Parents Inc.

Hailing the grant as an endorsement of WLP’s mission to secure quality

legal representation for domestic violence victims Pennington says,

"These women have lost their children, lost their property, and

even lost their safety by going into court unrepresented or representing

themselves." WLP’s attorneys work with the shelter in Mercer County

operated by Womanspace and the shelters in Burlington and Ocean counties

operated by Providence House.

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Management Moves

The Windrows at Princeton Forrestal, 2 Azalea Court,

Forrestal Village, Princeton 08540. Paul M. Lewis, executive director.

609-514-0001; fax, 609-514-0005.

Paul M. Lewis is now executive director at this retirement community

developed by CareMatrix Corporation of Needham, Massachusetts. It

includes Chancellor Park (an assisted living community), Forrestal

Skilled Nursing and Rehabilitation Center, and independent townhouses.

Lewis went to the University of Vermont.

Consultation on Church Union, 258 Wall Street,

Princeton 08540. Lew Lancaster, general secretary. 609-921-7866; fax,

609-921-0471.

Consultation on Church Union, a 30-year-old organization promoting

interdenominational unity among nine member churches, closed its office

on Wall Street Friday, May 28. Daniell Hamby, the general secretary,

is taking over the parish at St. Andrew’s Episcopal church in Yardley.

The organization is looking for a new executive. Lew Lancaster, a

resident of Louisville, Kentucky, who has been with the Christian

ministry for 40 years, will act as general secretary in the interim.

Top Of Page
Deaths

Mary E. DeCore, 91, on May 22. She and her husband owned

Jack Honore’s Barber Shop on Palmer Square.

Ruth Moment Cortelyou, 92, on May 23. In Franklin she

established and ran the Farm School and Camp Rogapeki-J.

B. Bud Chavooshian, 77, on May 27. He was assistant commissioner

of the Department of Community Affairs and a professor at Rutgers.

Joyce M. Cipelli, 61, on May 27. She was a waitress at

P.J.’s Pancake House for 30 years.

Corrections or additions?


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