- The Washington Times - Monday, April 30, 2001

Mark D. Gessler is no mad scientist.

At 39, he runs Gene Logic Inc., a company that is in two of the hottest businesses at the moment: information technology and genetics.

In that role he's forever busy especially these days. Friday he was named chairman of the company; today his company is releasing its first-quarter earnings report, which he said last week will meet Wall Street's expectations of steady growth.

The company is also in discussions with potential clients.

"We think that our pipeline of potential customers is the best it's ever been and it includes top pharmaceutical companies and biotech companies worldwide," says Mr. Gessler, who has started and seen into fruition six companies over the past two decades.

When big talk about genetic research began in the early 1990s, he saw the opportunity to build a business that would be both profitable and lead to the development of products that could forever change human life.

The result was Gene Logic, which sells subscriptions to its database of genomic research exploring the relationship between human genes and illnesses.

"Now that the [human] genome is sequenced, the next conquest, which will take a heck of a long time and it's extremely important, is to understand how genes are related to disease," says Mr. Gessler, a charming dark-haired Pittsburgh native.

Lounging in a conference room at Gene Logic's newest facility in Gaithersburg, the chief executive took time recently to tell The Washington Times about his business.

"We've built a database that tracks gene activity in human disease," he says. "We don't want to be in competition [with drug-developing biotechnology] companies. We want to enable them to do their work."

Since it was started in 1996, Gene Logic has signed up 16 clients, mostly large pharmaceutical and biotech companies. These subscriptions last up to three years and cost from $6 million to $16 million.

To build its database, the company collects thousands of human tissues from university hospitals. These tissues are studied and classified, as is the family history and habits of each of the subjects, explains Mr. Gessler, casual in a navy blazer, white shirt and khakis. So if a client wants to know what genes are involved in breast cancer, the client can search the database and even narrow it down by asking for a specific age group, habit (smoker, nonsmoker, level of caffeine or alcohol intake) and family medical history.

"Over time we're building up an e-human like what would be the genomic representation of an average 44-year-old woman on estrogen therapy," Mr. Gessler says.

As it builds it research, Gene Logic will create individual databases for diseases that much is known about. This quarter the company will be releasing its first specific disease database, which will offer all that is known about how genes relate to cardiovascular conditions.

Another of its products is a database that studies toxicity, or how existing drugs work on people suffering from certain illnesses.

Big drug makers like Pfizer, SmithKline Beecham, Procter & Gamble, Japan Tobacco and Merck are clients of Gene Logic. Its latest client, Sankyo Co., Japan's No. 2 drug maker, signed up in early April.

Although fundamentally Gene Logic is doing well according to analysts, the company's stock has dropped along with all biotech shares as investors have become more skeptical about the industry. This, in turn, has lead to fewer deals.

"Investors in the moment aren't assigning tremendous value to companies with subscription models," says Carl Gordon, analyst with OrbiMed Advisors in New York.

Shares of Gene Logic closed at $18.05 Friday on Nasdaq a price well off its 52-week high of $48.50 a year ago.

The volatility is one of the things Mr. Gessler likes most about biotech.

"I can't imagine a more exciting field at this time in history it's exciting, volatile, risky," he says. "I'm not a scientist, but I'm one of those business people who love science."

Mr. Gessler also revels in collecting vintage race cars: He has 10 of them.

In terms of management, Gene Logic's chief executive "is very up front," says Robert Olan, analyst with New York's J.P. Morgan. "He does a good job communicating where the company is and its strategic direction … Especially in early 2001, when deals were getting signed slower than expected, he was very clear and straight with investors."

Mr. Olan says he believes Gene Logic's "area of focus is going to be important for at least the next several years."

Mr. Gessler is equally optimistic. He points out that the company has added four new subscribers to its database so far this year, and hopes the clientele will double by next January.

"We're at the front end of a fairly steep curve coming after the sequencing era," Mr. Gessler says. While companies could build databases like Gene Logic's, it would be too expensive and take them too long, so they are better off turning to Gene Logic for the information, he says.

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