Small firms grow nicely 'in vitro' 'In-dish' techniques could one day replace testing with animals

Courage begets profit

Maryland companies include Paul Silber's precocious moneymaker

February 04, 1996|By Mark Guidera | Mark Guidera,SUN STAFF

Friends thought Paul Silber had bet the farm when he ditched a secure job as a toxicologist with Dallas-based Mary Kay Cosmetics, packed everything into a U-Haul van and headed for Maryland to start a company based on an obscure, yet promising, field of biotechnology.

Five years later, Mr. Silber relishes the memory as his Baltimore-based company, In Vitro Technologies, announced that in 1995 it turned a profit for the first time on revenues of almost $1 million. And he's expecting big growth in the next several years.

"I guess you could say my failing and my genius is that I started this company three years ahead of its time," said Mr. Silber.

Mr. Silber's upbeat tone would appear to be warranted. For the field his company specializes in, called "in vitro" -- or "in the dish" -- testing has caught the eye of some of the world's major pharmaceutical houses, cosmetics and household product companies, as well as regulators in Europe, Japan and to a lesser extent the United States.

In vitro testing uses human cells in the laboratory to test what effects new drugs, medical devices, household products and chemicals might have on people. It also is used to test the possible effects two or more drugs might have on one another and the human body if used simultaneously.

Currently, in vitro testing is largely used to screen products early in the development stage for potential adverse reactions or side effects.

Armed with that data, pharmaceutical and biotechnology companies can go back to the laboratory to tweak their new product before moving ahead.

Down the road, say experts, the process is likely to have a huge impact on the formulas for new perfumes and household cleaning agents, and more importantly on which new disease-fighting drugs and implantable medical devices win approval from regulators.

Potentially, it might replace costly and controversial animal testing -- now required for new drugs and medical devices before they advance to human clinical trials -- and generate millions in worldwide sales for companies offering the service.

At least three Maryland-based companies, including Mr. Silber's privately held start-up, are among 50 nationwide that offer in vitro services. Should regulators ever allow in vitro testing to replace animal testing, competition would explode.

Publicly held BioWhittaker, located in Frederick County, has positioned itself to grab a share of the expected growth by buying Clonetics, a California company considered a leader in culturing human cells in the laboratory for in vitro testing. Clonetics operations will be shifted to BioWhittaker's Walkersville headquarters this year.

Clonetics reported earning $700,000 on sales of $4.8 million in 1994, and expects revenues for 1995 to tally in at $5.4 million. Analysts said the acquisition should position BioWhittaker as a strong player in the emerging human cell culture and in vitro testing business.

The Rockville firm

Microbiological Associates, based in Rockville, has 20 years of experience in the field, and is developing new in vitro techniques. The privately held company expects significant business growth by offering the service to its pharmaceutical and cosmetics clients, said Dr. Brandon J. Price, vice president for business development.

"We see a lot of growth potential for us from in vitro testing," he said. Microbiological Associates declined to cite its growth projections for in vitro work.

But Mr. Price said the company expects the biggest revenue growth to come from new testing techniques developed for pharmaceuticals and biopharmaceuticals and consequently has increased its spending on developing new in vitro techniques by 20 percent.

The company recently was awarded a $1.2 million two-year contract from a European foundation to conduct research on new in vitro toxicity tests to show how they could be a safe, reliable replacement for animal testing, said Mr. Price.

"There is widespread interest in seeing an in vitro test developed for everything from birth defects to organ toxicity," said Dr. David Jacobson-Kram, vice president of the toxicology division at Microbiological Associates, whose in vitro test clients include some of the world's largest pharmaceutical and cosmetics houses as clients.

Mr. Silber, who launched his company in 1990 at the business incubator at the University of Maryland-Baltimore County campus, projects revenue growth of 60 percent annually for the next three years.

He also expects the In Vitro Technologies 10-person lab staff to grow to 50 by 1999.

The reason for the strong outlook, said Mr. Silber: testing improvements by his small team of scientists, and inroads In Vitro is making in markets overseas, including Japan.

Well-known clients

In Vitro's client list already reads like a Who's Who of the biotechnology and pharmaceuticals industries: Centacor, Glaxo Wellcome, Du Pont, Merck, Hoffman-La Roche.

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