Score one for the enzyme hunters.
San Diego-based Diversa Corp., which has made its name known in the past two years for being the Indiana Jones of the biotechnology industry, has nailed its first commercial deal to sell one of its enzyme-based products.
Although the dollar value of the deal was not disclosed (Diversa is privately held), it marks an important step for the company that travels the world's toughest neighborhoods looking for enzymes that could have value in industrial processes.
For those who ever thought the biotechnology business sounded a little boring (standing in a lab, mixing chemicals and shooting up little white mice), Diversa's business sounds more like an expensive safari. After all, these guys traded in their lab coats for bush hats and head to sub-Arctic freeze-zones or to the nearest undersea volcano to seek out what could prove to be a gold mine in the biotech realm.
Their purpose, of course, is not to see the sights but to unearth organisms that make their homes in what's called "extreme environments," where temperatures and pH levels drive off most living things. An example of this would be the cigar-shaped deep-sea Pompeii worms that live at the edge of hydrothermal vents on the ocean floor, in temperatures that approach 180 degrees Fahrenheit. More specifically, microbes that live on the backs of these worms contain enzymes that, because of their hardiness, have potential uses in the areas of oil discovery, industrial chemical processes, textile manufacturing drug research and development.
The company has been digging for similar enzymes in thermal hot springs at Yellowstone National Park and volcanic areas in Indonesia and Costa Rica. But although the firm has discovered and catalogued more than 700 proprietary enzymes -- more than the total number available from all other sources -- it has not, until now, been able to make the sales that will translate into future royalties for the company.
Under the deal announced Monday, Diversa will sell a product based on a heat-tolerant enzyme discovered living near an undersea volcano off the coast of Vulcano, Italy, to Halliburton Co., a Houston-based oil firm. Halliburton will use the enzyme in its new fracturing fluids that are designed to increase oil production in a cost-effective manner. Diversa will manufacture the enzyme for Halliburton.
"In less than two years, Diversa has used its proprietary technologies to isolate and overexpress this enzyme to create a valuable new product with the ability to enhance oil well production," Diversa CEO Terrance Bruggeman said in a statement. "The successful development of this product represents the value of Diversa's technologies for oil field recovery and validates their potential in other applications as well."
Speaking of biotech, curious investors (or the just plain curious) would do well to keep their eyes on the news this week as several industry players, including about a dozen from San Diego, make presentations at the annual Hambrecht & Quist Healthcare Conference in San Francisco.
The conference is regarded as one of the premiere opportunities for companies in the life science and health-care industries to gain investor interest. This means, of course, that biotech stocks are likely to fluctuate a bit during the week as well. It is also a time for companies to give updates on their research and development projects, which down the road could translate into some lucrative products.
The San Diego lineup includes a diverse platform of local companies, all of whom have their own reasons to be there. Diversa, mentioned above, made a presentation Monday morning. This may signal the beginnings of moving the firm toward an initial public offering, although a spokeswoman with the company said there are no plans for that yet on the table.
Amylin Pharmaceuticals, which many industry watchers considered dead after the latest clinical failure of its diabetes drug, also has a slot. That company announced Monday that, even with its setbacks, it still plans to file papers with the FDA by or during the year 2000.
Other San Diego firms making presentations include Signal Pharmaceuticals, Ligand Pharmaceuticals, Aurora Biosciences, Trega Biosciences, Dura Pharmaceuticals, Corvas, Synbiotics, Daou Systems, Maxim Pharmaceuticals and CombiChem.
San Diego's bid for national recognition as a technology hotbed may get a boost this week with the appearance of the city's crown jewel, Qualcomm Inc., in Fortune magazines' "100 Best Companies to Work for in America" issue, which hit newsstands this week.
The Sorrento Valley-based firm, which makes hand-held digital wireless phones, e-mail software and mobile tracking systems, made the top half of the list, at number 47, and was the only local firm selected to the list. The magazine cited the company's generous health benefits and its line of recreational facilities on its local campus. These include fitness centers, tennis courts, swimming pool and a sand volleyball court.
Qualcomm, like other local firms, could use the exposure, since the company is part of a local consortium that is aggressively trying to lure engineers and other talented labor here. Despite the area's beaches and unbeatable weather, San Diego tends to get lost in the shadow of Silicon Valley as well as its own past as a defense town.