RICHARD GABRIEL - DNAPRINT GENOMICS INC (DNAP)
CEO Interview - published 04/25/2005
DOCUMENT #
ABN618RICHARD GABRIEL is President and Chief Executive Officer of DNAPrint_
genomics, Inc. Mr. Gabriel served as President and Chief Executive
Officer of Calix Corp., parent company to Pharm-Eco Laboratories, Inc.,
from 1998 to 2001. He was instrumental in closing and managing more than
$135 million in contract revenue for Pharm-Eco Laboratories and
successfully completed the formation of numerous joint ventures, limited
liability companies and spin-offs that resulted in several public and
private companies in the genetics/chemistry/pharmaceutical field. From
2001 until joining DNAPrint, Mr. Gabriel consulted for several startup
companies while working as a Partner at Genbiomics, LLC, and as head of
Life Sciences Practice at Semaphore, Inc. Prior to the formation of his
own consulting practice in 1985, he was a Product Manager for W.R.
Grace. Mr. Gabriel obtained his MBA from Suffolk University's Executive
MBA Program, Boston, Massachusetts, in 1985, and a BS in Chemistry from
Ohio Dominican College, Columbus, Ohio, in 1978.
Sector: BIOTECHNOLOGY
TWST: Would you give us an overview of DNAPrint_ genomics and how you
conceptualize the company at this point?
Mr. Gabriel: Dr. Tony Frudakis founded the company in 1999. Tony is a
geneticist who has worked in the field all his life, and it was while
working for another company that he had some different ideas about how
genetics could be applied, especially in the pharmaceutical area. So he
decided to start his own company. I came on in 2003 with the goal of
staying focused on Tony's vision. At the time Tony formed the company,
the pharmaceutical industry was trying to determine how genetics could
be applied in developing drugs. A lot of companies were gathering
information on what they consider to be isolated populations that were
relatively 'pure.' Tony sensed that there was a problem with this. The
so-called 'pure' populations, based on his analysis, showed admixtures
of populations that had different origins, and came from different
regions of the world. For instance, Icelanders have anywhere from 5%-20%
East Asian in them. Now, when you look at an Icelander, you wouldn't
automatically think that person is from East Asia. As a matter of fact,
those genes are probably inherited from the Mongol invasion, which
occurred in the 12th century. So once the genes are inherited through
some political/social event, unless there is a dilution of those genes,
they stay within that community as long as the community continues to
remain isolated, or relatively intact. Tony came to the conclusion that,
since there are no truly 'pure' populations, why not study admixtures,
and that's exactly what the company did. Rather than go directly after
the pharmacogenomics area (that's the buzzword everyone is using now for
pharmaceuticals developed through an understanding of genetics) we
actually used the genealogy market to validate our technology. In
September 2002, we introduced ANCESTRYbyDNA_, a consumer product that
provides individuals insight as to their family heritage. We provide a
kit containing a mouth swab, which is sent back to DNAPrint's
laboratory. Following analysis, the complete results, including
genealogical history, are returned on a CD-ROM disc. The kit retails for
$219.
TWST: What are the genetic parameters for ancestry?
Mr. Gabriel: We originally launched our ancestry program based on four
population founder groups. ANCESTRYbyDNA can determine to which of the
four major bio-geographical ancestry groups a person belongs ' Sub-
Saharan African, Indo European, East Asian or Native American ' as well
as the relative percentages. Those founder groups have all been
established and accepted by the anthropological and archeological
community as being the migratory patterns of mankind. That's been well
documented. In August 2004, we took it a step further and developed
EuroDNA_. If you're 50% or more Indo-European we can determine your
genetic ancestry ' Northern European, Mediterranean, Middle Eastern or
Indo, which includes Pakistan and India. So now we can separate eight
groups. Why is this important? It goes back to not what your social and
your geopolitical affiliations are, but what are your inherited genes.
From the medical side, this is an important component in diagnosing and
treating patients. Because our technology is highly versatile, we turned
our attention to the commercial markets in 2003. At that time, we
launched DNAWITNESS_, an investigative tool for the law enforcement
forensics market. DNAWITNESS already has played a key role in the
apprehension of a serial killer and currently is being utilized in more
than 80 criminal investigations worldwide.
TWST: Can you tell us more about it?
Mr. Gabriel: DNAWITNESS is an investigative tool that analyzes DNA
recovered at a crime scene and can narrow the search for potential
suspects, reducing cost and time in making an apprehension. One of the
best examples that I can give you is the role that DNAWITNESS played in
identifying a serial killer in Louisiana. A police investigation into
eight murders over an 18-month period had come to a standstill.
Authorities were looking for a white male based on eyewitness accounts
of a suspicious man spotted near one of the crime scenes. Police rounded
up a number of individuals but DNA lifted at the crime scene did not
match. Then in March 2003, the authorities sent the DNA sample to us.
Now here's what makes the case interesting. We determined that the
authorities were looking for a killer of the wrong race. We were able to
call back and tell them, 'What you're looking for is an individual who's
85% Sub-Saharan and 15% Native American; clearly, he's not a Caucasian.'
About six weeks later an African American male who was previously
discounted as a suspect was arrested after his DNA matched the sample.
As I noted, we're involved in approximately 80 cases now, most of which
we can't discuss, for obvious reasons. Another one that we can talk
about, however, was in Concord, California. This is a case that had
exactly the opposite results: the targeted groups in a murder, based on
eyewitness reports, were Hispanics and Asian gang members. However, it
turned out that the individual who committed that murder was Caucasian.
DNAWITNESS is a technology that we continue to enhance. We recently
streamlined the analysis process by introducing a DNAWITNESS test kit.
The kit enables forensics experts to conduct their own tests in their
own facilities without sending recovered DNA back to us for analysis.
With most forensics work done by state and federal labs, the kits will
enable them to utilize DNAWITNESS technology while running DNA under
their own control. We've also signed a number of distributors ' Orchid
Biosciences is one of them, as well as ReliaGene and Lynn Peavey '
companies which are well known in the forensics and investigative
communities as suppliers of crime scene products. Our kit actually will
go out through our distributors as well as directly to forensics
laboratories. We're in the beta testing stage right now, and we've
selected a number of sites that will be running their analyses with our
kits. We also have a database with 2,500 photos that includes eye color,
skin shade, hair color and a number of other features ' which brings me
to the next point. We recently added another product in DNAPrint's
forensics arsenal called RETINOME_, a genetic test for predicting human
eye (iris) color from DNA. This is something that's very similar in the
complexities that one would find in human response to a drug ' how it
relates to the gene. So if you're 50% or more Indo-European, which is
where eye color originates ' either blue, green or some shade of that in
combination with brown ' with 95% accuracy we can predict your eye color
from a DNA sample. Now, that's really important for an investigator.
Again, remember that our DNA technology has nothing to do with your
political or social affiliations. It only has to do with where your
ancestors are from. That's something you can't hide. It's like a
fingerprint. We actually screen 176 markers ' and if we do the Euro
we're up to about 352 markers. In comparison, the Federal Bureau of
Investigation (FBI) has 16 loci, or points, that it uses to make a DNA
match. So we have a larger number of points that we look at.
TWST: How does DNAPrint's technology work?
Mr. Gabriel: Our technology is based on single nucleotide polymorphisms
(SNPs), commonly called 'snips.' Normal DNA screening may require the
analysis of millions of base pairs of genes to detect biological
patterns. DNAPrint's technology for targeting SNPs eliminates the need
to screen irrelevant base pairs, saving time and money. Our technology
is proprietary and we have filed more than a dozen applications for
national and international patent protection. When we started out, we
had one of the first SNP machines ' a first-rate device that was
developed by Orchid. We actually had the beta version. We now have a
newer version made by Beckman Instruments, which bought the
manufacturing equipment from Orchid. The new machine is very accurate,
about 99.99%. With this technology we can identify the 2,000 or so
ancestry information markers in genes for our consumer and forensics
products. Looking down the road toward pharmaceutical development, we
think there is a need to understand how families are related, what a
genealogy of a family could be, if there is a disease component in a
family and whether a new drug can be specifically formulated to meet
their individual or group needs. Even though we have validated our
DNAWITNESS technology with blind test studies through police and crime
laboratories, we are looking toward certification from the American
Society of Crime Laboratory Directors (ASCLD). We need to either qualify
for certification on our own or obtain it through acquisition. So we're
currently looking at acquisitions in general ' not only for the purpose
of obtaining ASCLD certification but we're also shopping for clinical
laboratories that could enable us to do diagnostics for the FDA. We had
been focused on an acquisition that we had to terminate, and we now have
targeted a number of synergistic acquisition candidates we're looking at
that will add revenue to the company.
TWST: What about the pharmaceutical prospects?
Mr. Gabriel: While we see our forensics business as an engine that will
generate revenues for the company, one of our fundamental goals is to
apply this technology to drug development. We recently took a big step
in that direction by acquiring an exclusive worldwide license from
Harvard Medical School's Beth Israel Deaconess Medical Center (BIDMC).
This is a royalty bearing agreement that creates an opportunity for
DNAPrint genomics to develop a new, more potent and longer acting form
of the anemia drug Erythropoietin (EPO). EPO is currently commercialized
by Amgen, Johnson & Johnson and Roche in a worldwide market that exceeds
$10 billion and that has been growing at an average annual rate of 21%.
The human gene that produces EPO was cloned in 1985 and in 1989,
scientists at Amgen introduced to market a recombinant form under the
trade name EPOGEN', a drug that many credit for the rise of Amgen in the
1990s as one of the world's most successful biotechnology companies
ever. Erythropoietin has been approved by the Food and Drug
Administration as a treatment for anemia associated with renal failure,
cancer chemotherapy, and Zidovudine-treated HIV-infected patients and to
reduce blood transfusion in surgery patients. Our goal is to develop and
market a 'super'-EPO, a more powerful form of the drug. This is a
perfect fit within the company's overarching strategy to utilize recent
genomics and chemistry advances made by our researchers to develop next-
generation drugs that maximize efficacy and minimize side effects by
tailoring medication for specific individuals and well-defined
population sectors. In addition, we already have developed a product
called OVANOME_ in collaboration with the University of Florida and the
H. Lee Moffitt Cancer Center. OVANOME is a genomic-based diagnostic tool
for matching ovarian cancer patients with the most suitable form and
dose of chemotherapy. We're particularly concentrating on patients being
treated with the drug Taxol. In previous FDA trials, Taxol-Carboplatin
drug combination therapy demonstrated efficacy in only about 60% of
patients treated. Our OVANOME therapeutic response tests have yielded
encouraging results so far. They were 96% effective in distinguishing
Taxol-Carboplatin responders from non-responders. Obviously, you do not
want to give a chemotherapeutic agent to a person unless you're going to
get a positive response. We've been collecting samples all along, but we
just now are in the process of enrolling an additional 100 patients into
a trial at the Moffitt Center, and over the next six to nine months
we'll be finalizing the data. Our goal is to be able to go to the FDA
and show them how important genetic ancestry is. When we originally
looked at the data on a prospective basis of patient populations, we
couldn't make sense of it. That's part of the problem with gene data, no
matter what technology you are using. If you don't understand the
ancestry, or the genetic inheritance that goes along with that data,
it's very difficult puzzle to solve because hundreds and hundreds of
genes need to be analyzed. We're not claiming that we have the end-all-
and-be-all answer, but we certainly have what we think is a reasonable
tool for analyzing that very complex data. The second product in our
pipeline is STATINOME_. This is a test for the cardiac drug market to
determine whether patients will be good or poor responders to a class of
drugs called statins. The importance here is that statins are effective
in cholesterol reduction but adverse reaction can lead to liver damage
or kidney failure.
TWST: What does your business model look like at this point?
Mr. Gabriel: To summarize, one goal that we have is to develop our
business model so that we continue to generate revenues in the genealogy
area. We do not believe genealogy will be our biggest market
opportunity, but ANCESTRYbyDNA has taken off in the consumer products
area, and we certainly have gotten a lot of press out of that. The
technology has been highlighted on CBS Television, ABC's 20/20 and
Nightline, and in The New York Times. So we actually plan on continuing
to expand it. We're looking at subpopulations and constantly gathering
new samples on a volunteer basis. And we're reorganizing our marketing
materials to be more consumer-oriented. In the forensics area, we've
done a tremendous job. We're actually out teaching prosecutors about DNA
technology. We've been establishing contact with the Innocence Project
as well. In addition, there's a significant opportunity here in New York
City for helping to identify all the unmatched samples of victims'
remains taken at the World Trade Center. We've been in contact with the
New York City Medical Examiner's office in the hope of convincing them
that our DNAWITNESS technology ' possibly in conjunction with one of our
distributors, ReliaGene or Orchid ' could tackle the remaining 10,000
samples from the 9/11 disaster and possibly come up with the
identification of more victims, or at least classify those samples into
groupings. The case in point that I have (and again, these are only
cases that have gone public that we're able to talk about) is of a young
girl's remains that were found in Florida. Initially, the match for the
parents was about 5,000 families. After running DNAWITNESS, we narrowed
the number down to about 50 families. That's the power of the
technology. If you're an investigator and you're looking at 5,000
families with one unknown, it becomes a daunting task. Even 50 families
is a daunting task, but at least you're not dealing with an infinite
number. The technology really has a way of narrowing down, in the case
of a murder or a felony, the person-of-interest, or in a case of human
identification of remains, the list of potential families from which you
have to take DNA samples in order to do the match.
TWST: It sounds like, longer term, the real opportunity is on the
pharmacogenomics side.
Mr. Gabriel: Well, the same thing applies in pharmacogenomics. Think of
it this way: Take an African-American medical patient who enrolls in a
trial for a drug that works specifically, let's say, for high blood
pressure. This is a condition that occurs more frequently in African-
Americans. But as it turns out, the patient's ancestors were mostly
Native American or East Asian; perhaps there was an African-American
great, great grandfather somewhere along the line whose characteristics
the patient inherited. The patient lives in the African-American
community and cannot be expected to change his or her social or
political affiliations just because of a DNA sample. The real problem is
that the patient may not have inherited the required gene that is
beneficial for the drug treatment, and the drug might actually do more
harm than good. What we want to do is optimize the drug development
process with what we call 'Theranostics' ' genetically tested drugs
appropriate for specific individuals and well-defined population
sectors. Our goal is to help insure that patients receive the
appropriate medicine and proper dosage the first time around. This takes
us back once again to the case in point where social/political
affiliations come into direct conflict with inherited ancestors. Your
genes have nothing to do with your political voice. As a matter of fact,
they don't care. But understanding a person's ancestry or genetic
inheritance is extremely important to the doctor and the patient. That's
really what our focus is. We have taken up the banner and actually had
discussions with the FDA.
Dr. Frudakis wrote about this as part of a discussion panel for current
pharmacogenomics guidelines, which includes hints about ancestry and
genetic inheritance. We're proponents of having an open dialogue with
the FDA and with the National Institutes of Health (NIH) about the
importance of genetic ancestry.
TWST: Is anybody else working in the same space?
Mr. Gabriel: Oh, certainly. The NIH itself has a pharmacogenomics
branch. The head of Human Genome Sciences has come forward on the
importance of genetic ancestry; the head of Celera Genomics has spoken;
Affymetrix and Perlegen Sciences are in this. There's a lot of
competition in this field. We just happened to start early, and we
happen to believe that diversity is a human quality that is a wonderful
trait ' but that it also brings along inherited markers that maybe
aren't so good from a medical standpoint. And for the medical field, we
think this is the only way to rationalize drugs.
TWST: Is there broad understanding and agreement on this?
Mr. Gabriel: There's a lot of debate, mostly around geopolitical and
social concerns ' which are legitimate. There is absolutely no question
about the legitimacy of these concerns. We live in a democratic society,
and in order to have a debate we need to have an open dialogue about it.
There are already laws on the books that offer remedies for many of the
concerns. I would say that if an insurance company discriminates against
an individual because of an inherited marker and denies that person
insurance, it could result in hundreds of millions of dollars' worth of
lawsuits. At the same time, the federal government wouldn't allow this
type of discrimination to begin with. So there's plenty of legislation
in place to protect individuals. There are independent review boards at
hospitals, patients' bills of rights ' a lot of legislation is in place.
You cannot discriminate against individuals in the United States and get
away with it.
TWST: What type of standards does DNAPrint genomics set for itself?
Mr. Gabriel: We operate under the highest ethical standards and have a
strict code of ethics. DNAPrint genomics has a unique database that
gives us an understanding of families and how they're related, but we
don't divulge any of that information. Our customers' data is private.
If they ask us to destroy the DNA we do ' though some people ask us to
keep it because, for historical reasons, they want to make sure that if
they're doing a family genealogy they'll have DNA samples from all the
members of the family for comparison. And in that case we keep those
DNAs.
TWST: Is all that going to inhibit development?
Mr. Gabriel: Starting before Dr. Mark McClellan's tenure at the FDA, but
really under his leadership, this issue has come to the forefront. I
have to say that the FDA has taken an absolutely stellar lead in
encouraging this dialog. And along with that, the NIH has been also a
strong promoter and will continue to be. I think it's in the best
interest of all mankind to understand what your heritage is and what
diseases are inherited.
TWST: Tell us about the company's management and its goals for the
future.
Mr. Gabriel: We've all been working at this for some time. I've been in
the pharmaceutical business for 20 years.
Dr. Hector Gomez, our Chairman and Chief Medical Officer, has been in it
all of his life. He has 11 drugs under his belt; I have four or five and
probably have been involved with 60 or 70 ' from discovery all the way
to approval ' over the course of my career. There are three or four
drugs on the market now that have gone through my previous company's
hands. We're dedicated individuals, and I thank our shareholders for
believing in our company. And that, quite honestly, is why we're looking
for acquisitions. We want to build our revenue, and we either build our
revenue through sales, selling a new technology into a market, which is
hard, or we acquire it ' and we're aggressively looking at both because
the goal is to boost shareholder value. I myself am a shareholder.
TWST: What are you looking for in the way of acquisitions?
Mr. Gabriel: Companies that bring accreditation to us in the
pharmaceutical area as well as in the forensics area. We are looking
across a broad spectrum of companies, both public and private.
TWST: Are there any milestones that you can set out for the next year or
two?
Mr. Gabriel: Our milestones have always been the same. They haven't
changed from the first day I came onboard. The goal is to make the
company profitable as soon as possible, and we're pursuing that by
developing products that we can get out into the market. Our new
DNAWITNESS test kit is just an example. We continue to build our
database. We have a 2,500 photo database and we collect samples. We're
building our product portfolios to make our products attractive to the
customers in genealogy as well as in forensics, and we will continue to
do that. Pharmacogenomics is a longer haul, but it certainly offers a
much greater point of return when a product is approved and is accepted
by the market. So we look at it in a three-step fashion. We look at our
consumer products market, building our continued consumer base, and we
have probably sold, oh, I don't know, 11,000 or 12,000 samples, or kits
into that market, and our long-term goal is to have, quite literally,
millions of those. So we will be a very unique company in that we will
have analyzed, literally, millions of DNA samples on a blind basis '
blind samples. We know nothing about the individuals; we just get a DNA
sample, and we report on it back to them. We also think there's a
tremendous opportunity in forensics. In the investigation of cold cases
-' and there's a backlog of hundreds, if not hundreds of thousands of
such cases ' our technology can be used to help categorize those cases.
Certainly categorizing DNA samples is important for the Innocence
Project. If a crime scene sample shows that the suspect is Caucasian and
the individual who's incarcerated is African-American, obviously, you
move his DNA to the top of the pile and you do the match and you free
him. So there's plenty of opportunity in those two markets for growth.
It's steady and consistent growth. It will, however, not be the bell
ringer. The real bell ringer for this technology has always been in the
pharmaceutical area, really matching the patient with the doctor and
with the therapy through 'Theranostics.' That's what this technology can
do. It can actually put the doctor and patient back in control of the
pharmaceuticals that are being administered for the disease that's being
treated. We can do this one step at a time, one drug at a time. We'll
just proceed down that path and have an open dialog with the FDA, the
NIH and move our technology forward. In addition, we're looking at
licensing opportunities for therapeutics as well ' in other words,
talking to people about drugs that we can bring in. We want to run
clinical trials of drugs along with our technology, and instead of
having 40% or 60% efficacy we could have up to 95% efficacy, which means
longer product life. That's a novel concept, and an important one.
Especially when patents expire, the question always is, how you keep
generics out. Well, how you keep generics out is that you have a product
that is 95% efficacious. That builds brand loyalty, and people don't
want to change. Aspirin has been around for a couple of hundred years,
and everybody knows Bayer aspirin; or Tylenol, anyone can make Tylenol,
but no one thinks of acetaminophen, people think of Tylenol. That's
brand loyalty. It's something that's been around in the pharmaceutical
industry itself, and you do that by making a product that, when you take
it, the result is there. You take Bayer aspirin, you know what you get;
you take Tylenol, you know what you get. So if you have a disease and
you have a drug that treats the disease, the doctor knows that it's an
efficacious drug, and if you match the patient to the drug and it works,
then that's what's going to happen. That's how scrips are generated.
TWST: Thank you. (TJM)
RICHARD GABRIEL
President & CEO
DNAPrint genomics, Inc.
900 Cocoanut Avenue
Sarasota, FL 34236
(941) 366-3400
(941) 952-9770
www.dnaprint.com
e-mail: dnap@dnaprint.com
&save_presets=0&go=upper&a=940906&b=0&banner_ref=HASH(0x9cbf1cc)&zeitraum=9&ind_volume=ON&zoom.x=0&zeitbis=&bis=1113292369.48471&bname=&cookies=HASH(0x89351d4)&req_host=ARRAY(0x9ce6908)&zeitvon=0&von=0)
