Proteome System teams with Charles River to form contract service

Sydney-based company Proteome Systems has teamed up with big US services company Charles River Laboratories to create a new joint venture company, Charles River Proteomics Services.

The new company will make use of Proteome Systems' ProteomIQ and BioinformatIQ technology and expertise to provide proteomics testing and analysis services on a fee-for-service, contract basis to big pharma and biotech.

Charles River Proteomics, whose initial capitalisation is $US6 million ($11 million) is 80 per cent owned by Charles River, and 20 per cent by Proteome Systems. Until March next year -- when the company will become fully operational -- Proteome Systems has an option to increase its equity to 40 per cent, and in 2006 Charles River will have an option to buy all the equity in the company. Charles River expects the new company to start attracting earnings in 2004.

Proteome Systems' deputy CEO John Martin said the deal had taken nine months to come to fruition.

"[Charles River's] model is not joint ventures -- they like to own things," he said. "We talked to them because they said they had identified proteomics as one of several areas they wanted to get into. Their CEO, Jim Foster, is a very switched-on guy, and they know there's good money to be made in the service model."

In a statement, Foster said Charles River's pharmaceutical and biotech customers were telling the company that proteomics was expected to be an important contributor to new drug development.

"We are delighted to participate in this evolving market as a service provider, at such an early stage," he said. "Our selection of Proteome Systems as our partner in this exciting venture further underscores our commitment to deliver scientific excellence and state-of-the-art solutions to meet the needs of our customers."

Martin said that big pharma was turning to proteomics to improve its toxicology studies on new drugs.

He said Proteome Systems would relocate some of its Sydney staff to its Boston office to help to set up the company. He said that the Boston operations were a big incentive for Charles River, which is based in Worcester, Massachusetts, to work with Proteome Systems.

Charles River Proteomics will incorporate a 930 square metre laboratory housing the ProteomIQ automated sample handling equipment, mass spectrometry hardware and bioinformatics system. The new facility will also serve as a demonstration facility that will allow Proteome Systems and its partners to market the ProteomIQ platform and related products to customers.

In a statement, Proteome Systems CEO Dr Keith Williams said the new venture was a perfect opportunity for the company to demonstrate the strengths of its technology platform and problem solving skills.

"Charles River's considerable experience and reputation in providing drug discovery and development services and research tools makes them an ideal partner for us to enter into the proteomics testing market,' he said.

Charles River, formerly best known as a supplier of lab animals, has repositioned itself as a provider of tests and services for drug research, earning it the title of 'Company of the Year' in a recent Boston Globe report.