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Home , Applied Biosystems, Cetus Corporation, Ivor Royston

Biotechnology and The pharmaceutical industry has embraced the genetic revolution.

CELIA HENRY

onsidering just how long people have been perspective, here was using organisms to generate products for a method that could Cthem—think thousands of years of beer “tinker with” or and wine—the industry is remark- “improve” life. In ably young. The industry as we know it today is response to scien- not even 30 years old. Yet, even in that short time, tists’ call for a moratorium on it has managed to have a major impact. recombinant DNA research, the National In the broadest sense, biotechnology is defined Institutes of Health (NIH) formed a recombinant as the use of any technology to manipulate living DNA advisory committee to oversee research in systems. However, what we call the biotechnology the field. In February 1975, prominent molecular industry is most readily associated with drugs that biologists, along with a few lawyers, physicians, are produced by bacteria that have and journalists, met at the Asilo- been genetically modified to mar Conference Center in Pacif- produce a they would not ic Grove, CA, to discuss the have otherwise produced, one issues surrounding such DNA that would normally be produced research. The recommendations by an entirely different organism. from the meeting were devel- Before the advent of biotech- oped into NIH guidelines that nology, obtaining adequate quan- were approved in 1976. tities of such molecules was an arduous exercise in protein isola- The Big Boys tion and purification. With the In 1976, venture capitalist invention of genetic engineering, Robert Swanson approached scientists could harness bacteria Boyer about the possibility of to crank out quantities of starting a company based on that made them feasible as drugs. recombinant DNA technology. Top: Biotechnology research, Artville On April 7 of that year, Genen- Center: Herbert Boyer, founder of Founding Technology tech—the first biotechnology company—and the , National Library of The most important technology for the biotech- modern biotech industry were born. Medicine nology industry got its start when Stanley Cohen, California was the perfect place for the nascent a biologist at , and Herb Boyer, biotech industry because it already had a venture a biochemist at the University of California, San capital community in place from the Francisco, discussed a research collaboration over computer industry. However, money from late-night deli sandwiches in Hawaii while attend- , the firm ing a conference. They would take advantage of that Swanson worked for, only trickled into their complementary expertise in plasmid biology Genentech until the company could demon- and restriction enzymes to insert new into strate that human proteins could be bacteria. Those new genes didn’t have to be from produced this way. bacteria. Instead, they could be from higher organ- Swanson served as the CEO of Genentech isms, and the bacteria would produce proteins from 1976 to 1990. In 1990, he was named chair- normally made by other organisms. They started man of the board, a position he held until 1996. their experiments soon after returning from the Following his retirement from Genentech, he conference, and by March 1973, they knew that founded K&E Management, an investment their method worked, giving researchers the ability management firm that provided funding to start-up to isolate and amplify genes of their choosing. biotech companies such as Cytokinetics and AGY Recombinant DNA, as it was called, met with Therapeutics. initial controversy as people, scientists included, Within three years of Genentech’s founding, grappled with its implications. Depending on the company scientists had produced three human

ENTERPRISE OF THE CHEMICAL SCIENCES 67 proteins in bacteria in rapid succession. The first company, went public in 1983. Its first true block- protein to be cloned was somatostatin in 1977. buster drug was Epogen, a genetically engineered Human insulin followed in 1978, and human version of erythropoietin, a protein that stimulates growth hormone in 1979. the formation of red blood cells. Epogen remains Although the company still had no products, one of the most successful biotechnology drugs, BIOTECHNOLOGY AND Genentech went public in 1980. It launched its with more than $2.4 billion in sales in 2003. GENETIC ENGINEERING initial public offering (IPO) on October 14. Shares Plenty of DNA research was going on outside were offered at $35 each. Within the first hour, the of California as well. was founded in 1978 stock price had jumped to $89, and it ended that by a group of biologists—many from the Boston first day at $71.25, marking one of the most suc- area—who gathered in Geneva. Future Nobel cessful public offerings on record. Prize winners Phillip Sharp of the Massachusetts Genentech’s successful IPO demonstrated that Institute of Technology, who won for RNA alter- biotech companies could raise capital before getting native splicing, and Walter Gilbert of Harvard anywhere near the clinic. A wave of new biotech University, who won for DNA sequencing, were companies was created in the wake of Genentech. among the founders of Biogen. The company is One of those companies was , which located in Cambridge, MA. originally stood for Applied Molecular Genetics, in Genzyme, another Boston area company, was Thousand Oaks, CA. founded in June 1981 by Henry Blair and Sherry Amgen was founded in Snyder. Genzyme has managed to thrive as a TAKING A DIFFERENT TAQ 1980 and began operations broadly diversified biotech company with divisions Kary B. Mullis, a scientist at in early 1981 with initial working in diagnostics, therapeutics, surgical prod- in Emeryville, CA, came up with the idea for the funding of approximately ucts, and tissue repair, among other areas. polymerase chain reaction (PCR) in the spring $19 million. Members of of 1983 while driving. He suggested using a pair the company’s original The Other Biotech of primers to bracket the desired sequence and Scientific Advisory Board While work with protein drugs was going on, a copying it using DNA polymerase. He quickly real- (SAB) included Leroy C. parallel branch of the biotech industry was devel- ized that such an approach would allow him to Hood, then at the Califor- oping—monoclonal . Antibodies are double the number of copies of the DNA and that nia Institute of Technolo- proteins made by the immune system in response cycling through the reaction several times would gy. Other SAB members to foreign agents. result in an exponential amplification of the tar- were at the University of Antibodies have excellent recognition proper- get DNA. Mullis and his colleagues took close California, Santa Barbara, ties, but they are difficult to isolate in large quan- to two years to show that the concept actually and the University of Cali- tities. A breakthrough by César Milstein and worked. fornia, Los Angeles. Thou- Georges Köhler at the Medical Research Council Before PCR could become a viable commercial sand Oaks was picked as Laboratory of in Cambridge, technique, it was necessary to find a DNA poly- the location for the new U.K., in the early 1970s changed that. They found merase that could survive temperatures cycling company to be near its that by fusing an -producing cell with a between 37 °C, where annealing and polymeriza- SAB members. The first myeloma cell (an immune system cell) they tion occur, and 95 °C, where DNA denaturing CEO of Amgen was could get a cell that pumped out large quantities of occurs. The DNA polymerase known as Taq poly- George Rathmann, who a single antibody. Such cell fusions are often called merase from the thermophilic bacterium Thermus had been a vice president hybridomas. aquaticus, found in hot springs in Yellowstone for research and develop- The first company founded to commercialize National Park, was chosen. ment at Abbott Laborato- monoclonal antibodies was San Diego-based Hy- Because PCR was tangential to Cetus’s main ries. In 2002, Amgen ac- britech, started in 1978 by venture capitalist Brook focus on cancer therapeutics, the company looked quired the Seattle biotech Byers, Ivor Royston, a professor at the University to outside partnerships to commercialize the tech- company Immunex. of California, San Diego, and Howard Birndorf, a nique. Cetus signed an agreement with Kodak to The first biotech prod- researcher with Royston. The original idea was to develop in vitro diagnostic tests and entered into uct was marketed in 1982. produce monoclonal antibodies as research tools to a joint venture with Perkin-Elmer. Other compa- Genentech’s human replace polyclonal antibodies (mixtures of antibod- nies approached Cetus about the possibility of insulin, called Humulin, ies that target the same antigen), but the compa- licensing agreements. One of the companies that was licensed to Eli Lilly ny’s scope quickly expanded into diagnostic tools Cetus negotiated with was Hoffmann-La Roche, and Company, and it re- and potential therapeutics. It launched its IPO in which had exclusive rights to the basic patent for mains a major product 1981, raising $12 million followed by a $33 million interleukin-2, which Cetus was developing as an today, with sales of more second round in 1982. The company’s first product anticancer drug. Hoffmann-La Roche (Roche) than $1 billion in 2003. was a test kit for immunoglobulin E. Hybritech was funded diagnostic research at Cetus to the tune Genentech brought its purchased by Eli Lilly in 1985. of $6 million per year for five years. In 1991, own product to market in Hybritech was just the first in a line of compa- Roche bought the rights to PCR. Perkin-Elmer 1985—human growth nies seeking to commercialize monoclonal anti- formed a strategic alliance with Roche to com- hormone, which was the bodies. However, therapeutic success wasn’t mercialize PCR. first biotech product to be achieved until 1998, when the FDA approved manufactured and market- Rituxan, a developed by

Above: PCR instrument, ed by a biotech company. IDEC Pharmaceuticals and Genentech to treat Pharmaceutical Century Amgen, which is today the largest biotech non-Hodgkin’s lymphoma, a type of cancer. A year

68 ENTERPRISE OF THE CHEMICAL SCIENCES later, Genentech won Food and Drug Administra- reaction. The fluorescent dyes eliminated the tion approval for Herceptin, a monoclonal anti- health hazards of the radioisotopes that were previ- body that targets the Her2/neu receptor in patients ously used and allowed all four bases to be analyzed with metastatic breast cancer. in a single gel. The company commercialized the technology in 1986. Automat- BIOTECHNOLOGY AND False Assumptions ed sequencers later became the workhorses of the GENETIC ENGINEERING In the early days of the biotech industry, compa- . nies operated under the false assumption that In 1983, Kary B. Mullis of Cetus Corporation development of biotech products would be easy. invented the polymerase chain reaction (PCR), After all, they were making proteins that the body which amplifies small amounts of DNA. PCR has already made. They also assumed that once the particularly revolutionized diagnostics and forensic technology of cloning the protein was developed, chemistry by allowing tiny quantities of DNA to the rest would be easy. be copied and yield enough DNA for analytical The first-generation biotech products were analysis (see sidebar). replacement proteins—things such as insulin for diabetes and and interleukin-2 for can- Hunting cer. It seemed reasonable to assume that these In the early 1990s, several biotech firms such as drugs would not cause any surprise Human Genome Sciences (HGS) of Rockville, side effects. The companies forgot MD—founded by William A. Haseltine in that they were delivering large 1992—concentrated on identifying and patenting quantities of the proteins systemi- genes related to human disease for the purpose of cally when they are usually present finding drug targets. The business models for locally at fairly low levels. Early these companies called for selling information to clinical trials with interferon and larger pharmaceutical companies rather than interleukin-2 were plagued by developing drugs. However, such strategies severe side effects. proved unsustainable, and companies such as In addition, the cells being used HGS, Millennium Pharmaceuticals, and Celera to produce the proteins made a form are transforming themselves into full-fledged that differed slightly from the ones drug-development companies. humans make. They had different In 1990, the Human Genome Project was patterns of carbohydrate modifica- launched to obtain the complete blueprint of tions, and the bacteria stuck an human DNA. The project was made possible by extra on the end of the technologies to automate the sequencing of protein that could cause allergic DNA. The international public effort, which reactions in patients. included laboratories from the United States, the United Kingdom, and Japan, was expected to DNA Tools take 15 years. Advances in methods of analyzing DNA helped The appearance of the company Celera Gen- to propel the industry forward. Before a gene omics, a joint venture of Perkin-Elmer and Craig could be inserted into bacteria, it was necessary to Venter, founded in 1998, turned the quest to se- know the sequence of nucleotides in that gene. In quence the human genome into a race between 1977, Frederick Sanger of the Medical Research public and private efforts. Celera was using a new Council’s Laboratory of Molecular Biology in approach, called whole-genome shotgun sequenc- Cambridge, U.K., and Walter Gilbert of Harvard ing, in which computer programs were used to University independently devised methods for reassemble the genome sequence. In June 2000, sequencing DNA. Francis Collins and Venter unveiled a draft se- Sanger’s method uses an enzymatic approach in quence of the human genome, effectively declaring which special versions of the nucleotides serve as the race a tie. chain terminators that prevent further growth of Public fascination with the Human Genome the DNA molecule. The synthesis results in DNA Project fueled a biotech boom in 2000, based on chains of different lengths, and the sequence of the the mistaken notion that the genome sequence bases in the DNA is revealed by separating the itself would lead directly to cures for disease. More DNA with gel electrophoresis. Gilbert’s method than 60 IPOs were launched that year. According uses chemical reagents that selectively cleave the to one estimate, the biotech industry raised more DNA at the different bases, again resulting in than $32 billion through all avenues that year. DNA strands of varying lengths that are separated Today, there are hundreds of biotech compa- by gel electrophoresis. nies, ranging from tiny start-ups to the large inte- DNA sequencing became even more useful af- grated biotechnology companies. They work in ter and his coworkers at the California every imaginable therapeutic niche. Some Institute of Technology invented an automated branches of the field have moved beyond thera- peutic biotechnology to agriculture and even Above: DNA sequencing, 2003, DNA sequencer in 1985. Hood used fluorescently Analytical Chemistry labeled dideoxy reagents in the industrial chemicals. ◆

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