HR: Leaving Town

Deaths

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This article by Barbara Fox was prepared for the

December 11, 2002 edition of U.S. 1 Newspaper. All rights reserved.

Life in the Fast Lane: Orchid BioSciences

The founding CEO of Orchid BioSciences, Dale R. Pfost,

has lost his job, and so has Donald R. Marvin, senior vice president.

The stock price on Nasdaq had fallen to 50 cents from its last year’s

price of $4 to $7, and the company had severe financial difficulties.

In the first nine months of this year it made $50 million, lost $45

million, and had $12.5 million in cash. The two resigned on December

9.

George Poste, who had been installed in October as chairman of the

company, promises to "further strengthen our cash position and

to augment our senior management team." The company is seeking

a line of credit to pay its bills, and it also hopes to sell a

division that makes equipment for analyzing genetic differences.

Orchid was one of Sarnoff Corporation’s early spinoffs. Sarnoff’s

semiconductor expertise helped develop "miniaturized"

microfluidic lab processes for what has affectionately been known as

the "lab

in the palm of your hand" (U.S. 1, January 29, 1997).

Pfost majored in physics at the University of California at Santa

Barbara (Class of 1980) and has a Ph.D. from Brown. In Great Britain,

he was CEO of Oxford Glyco Sciences, and he came to Sarnoff in 1996

(U.S. 1, January 29, 1997).

Marvin went to Ohio State, Class of 1974, and has an MBA from Iona

College. He has worked at Miles Laboratories (now Bayer), Abbott

Laboratories,

Pepsico, and Boehringer Ingelheim in California, where he helped sell

off the diagnostic division. As a consultant at Sarnoff, he helped

hire Pfost.

After Orchid’s IPO in 2000, the stock price jumped from $8 to $57

and had 250 employees. Pfost (pronounced "post") spoke at

U.S. 1’s Technology Forum that year and predicted that Orchid’s

technology could "change the way medicine is practiced."

Sarnoff made its money. "During the first several years of

Orchid’s

existence Sarnoff had a significant ongoing revenue stream from

research

work, and Sarnoff did have an equity position which it liquidated

by the spring of 2001," says Anne Van Lent, former vice president

of ventures at Sarnoff, now CFO at Barrier Therapeutics at Princeton

Overlook. By the time Sarnoff sold the stock, it was priced between

$4 and $7 and would have been worth from $7 million to $11 million.

As Van Lent points out, Pfost and Marvin shifted strategies quickly.

"Dale and Don were very creative in looking for strategic

corporate engineering opportunities to reposition the company as the

market evolved and the need for high throughput research tools

declined," she says. They moved into the DNA area by buying such

companies as Molecular Tool, Genescreen, Cellmark Diagnostics, and

Lifecodes Corporation. Now the high-margin business of gene testing

services including a major contract for identifying individuals at

Ground Zero provides most of Orchid’s revenue. Paternity testing

(especially for race horses), gene testing for agriculture, and

forensic testing are profitable.

This year, 180 of Orchid’s 700 jobs were cut, and at the College Road

headquarters the headcount dropped from 180 to 100. A search committee

has been appointed to replace Pfost but not Marvin, and Tracy

Henrikson, Orchid’s spokesperson, says that the board feels the

company can be profitable by the end of 2003.

Among Orchid’s institutional investors are Orbimed Advisors,

Wellington Management, Morgan Stanley, and Calpers, the California

pension fund, which owns 2.7 percent of the firm. Nasdaq threatens to

de-list the stock unless the price goes up to $1 by January 8.

— Barbara Fox

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HR: Leaving Town

Sales Consultants of Williamsburg, 1311

Jamestown

Road, Suite 202, Williamsburg, VA 23185. 757-220-8760.

Www.plasticspgk.com

Richard Strenkowski has moved his executive recruiting business to

Virginia. Due to a franchise requirement with his former company,

Management Recruiters, he has changed his name so that he belongs

to a different division of that company.

A food science major at Clemson, Class of 1966, he ran plastics

companies

for 15 years. He focuses on the plastics and packaging industries.

"It’s just a great location down here," he says.

Top Of Page
Deaths

Henry Chauncey, 97, on December 3. Believing that

standardized

testing could help identify talent, he founded Educational Testing

Service in 1947 and served as president until 1970.

William T. Clark Jr., 47, on December 9. A retired

sergeant

with the Princeton Borough police, he was director of security at

the Nassau Inn.


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