Metabolon Featured in The News and ObserverLife sciences technology company Metabolon has more than doubled its workforce in the past 24 months and expects to double it again during the next two years as it diversifies its business. John Ryals, CEO of the privately held Durham company, sees its coming diagnostics business as having even greater potential than its existing analytics services business. Metabolon's analytics work for drug and consumer product companies and universities generated $14 million in revenue last year, double the 2009 total. "This year we're probably looking at $20 million," said Ryals, who previously co-founded and led publicly traded Paradigm Genetics. Founded in 2000, Metabolon has about 100 workers, up from 45 in May 2009. About 85 of Metabolon's workers today are based in Durham; 37 have doctorates "They have flown under the radar," said Carol Marino, vice president and head of U.S. investing at Syngenta Ventures, the venture capital arm of agribusiness giant Syngenta, which is an investor in Metabolon. "Theyhaven't done enough PR on their own. They're a terrific company." Metabolon, which has raised $32 million in funding to date, was founded in 2000 but existed mostly on paper until Ryals was recruited as president and CEO in April 2002. Ryals joined the business a few months after he was fired for undisclosed reasons as CEO at Paradigm; he had refused to resign. Although Paradigm was struggling at the time he left, under Ryals the company raised more than $100 million in financing - including an initial public offering of common stock - and had 280 workers at its peak. Metabolon, which has raised $32 million in funding to date, was founded in 2000 but existed mostly on paper until Ryals was recruited as president and CEO in April 2002. Ryals joined the business a few months after he was fired for undisclosed reasons as CEO at Paradigm; he had refused to resign. Although Paradigm was struggling at the time he left, under Ryals the company raised more than $100 million in financing - including an initial public offering of common stock - and had 280 workers at its peak. Metabolon's patented analytics technology finds biomarkers, or biochemicals, that point to a disease's existence or severity. It performs these analyses for a host of drug companies, including Merck, Pfizer and GlaxoSmithKline, that want, for example, to understand how a medication works or pinpoint problems in manufacturing biotechnology drugs. It also works for consumer product companies such as Colgate-Palmolive. "We've done many studies on (Colgate) Total toothpaste, because they're trying to prove that Total actually affects gingivitis and periodontitis," Ryals said. "We've published now three papers in the Journal of Dental Research on this where we can show ... a very dramatic effect." A new insulin testThe company's technology also can be used for diagnostic products. Its first, Quantose, which is expected to be ready to launch shortly, is aimed at detecting insulin resistance. That can lead to Type 2 diabetes, cardiovascular disease and hypertension. "It's a very huge market," Ryals said. "About 30 percent of all the people in the developed world are at risk for insulin resistance." Currently, the prevailing test for insulin resistance is an oral glucose tolerance test, which involves imbibing a glucose drink and sitting in a doctor's office for two hours or more while your blood is drawn at regular intervals. Neither patients nor doctors like it, Ryals said, andmany general practitioners don't use it. Quantose, by contrast, involves taking a single blood sample and no glucose drink is necessary. Quantose is a test that would be administered by primary care physicians, which is why Metabolon is seeking a marketing partner. "There are 250,000 GPs in the U.S. It takes a very large sales force to reach them," Ryals said. "We're talking to a lot of major lab testing companies and diagnostic companies." Next on the agenda are two diagnostics for prostate cancer that the company hopes to introduce next year, including a detection test that could help avoid unnecessary biopsies. About 70 percent of all biopsies for prostate cancer turn out to be negative, Ryals said. Since the cancer diagnostics would be marketed to a much smaller group of doctors - urologists and uro-oncologists - Metabolon plans to market those on its own. Raising capitalIt's an ambitious agenda that requires major funding. Ryals envisions raising about $10 million in additional capital this year and a significantly larger amount next year to hire a sales force and start its cancer diagnostics business. Given the company's record, Ryals and the company's investors, which include Aurora Funds of Durham, don't anticipate difficulty raising $10 million this year. Next year's much larger target, however, is a question mark because of the difficult funding environment. An initial public offering of common stock would fit the bill, but who knows what shape the IPO market will be in a year from now? The good news, said Jeff Clark of Aurora Funds, is that Metabolon can afford to be patient because its analytics business is already approaching break-even. He is optimistic that the company could use its own cash to get its diagnostic cancer products off the ground if necessary. david.ranii@newsobserver.com or 919-829-4877 |