Gen-Probe's DNA Play

Gen-Probe is one of the few successful players in the emerging field of DNA probes. Long a niche player, it is teaming up with bioMerieux and Chiron to tackle bigger, more complex markets in blood banking and viral and cancer diagnostics. To do this, it needs to acquire a new set of skills.

Niche player Gen-Probe claims it is ahead in the race to fully automate DNA amplification and its partners agree.

by Wendy Diller

• Gen-Probe's success in the DNA probe market has been built on its ability to provide customers with convenient, simple-to-use products, but now it is expanding into the more complex fields of blood bank screening and viral and cancer diagnostics.

• A string of recent deals with major diagnostics companies like bioMerieux and Chiron could transform the company into a powerhouse in the fast-growing DNA probe business.

• Gen-Probe's deal with Chiron gives it much coveted rights to HCV, pitting it directly against industry heavyweight Roche and threatening to shake up the staid world of blood bank screening.

• Gen-Probe's ability to respond quickly to market demands illustrates the strengths of being a focused player in a changing field, but it still has to prove that it can deliver on its much more ambitious agenda.

In late 1995, the National Institutes of Health 's National Heart, Lung and Blood Institute asked companies to bid on development of an amplified DNA-probe-based test for screening the nation's blood supply for HCV and HIV. The agency wanted a test to help ensure the blood's safety. It was convinced that the enhanced sensitivity provided by DNA probes was worth the additional cost of using them.

The idea of applying DNA probes to blood screening had been talked about in regulatory, medical and business circles for some time. But the offer still came as a surprise to the diagnostics industry, which viewed the technology as a remote business opportunity. The tests, after all, would be expensive in an era of cost containment, the automated technology necessary to do high volume screening didn't exist, and the risk of getting the diseases from blood transfusion was already remote, given the accuracy of available immunoassay techniques. The NHLBI's involvement therefore demonstrated to many people that the near-term use of nucleic acid-based tests in blood screening was a realistic goal.

The agency's choice for a supplier also came as a surprise-the $7.7 million contract went to niche player Gen-Probe Inc. , eliminating 15 competitors, including obvious candidates like Roche , Abbott Laboratories Inc. and Johnson & Johnson . Gen-Probe, while an important force in the emerging field of DNA probes, was hardly a major player in diagnostics or blood banking. It had built a successful business by focusing on easy-to-use and convenient DNA probe kits for a small number of diseases requiring straightforward tests. Now, it was being endorsed by a highly respected government agency and getting a toe in the door to one of the most intriguing, complex opportunities in genetic testing.

Not only did the award demonstrate Gen-Probe's prowess over some competitors, but it also gave credibility to the company's heretofore low-profile efforts to fully automate its internally-developed amplification method. In the nearly two years since Gen-Probe received the grant, it has entered into several deals which could catapult it into the hottest areas within the DNA probe market, which is the fastest growing segment of the diagnostics industry.

In May 1997, the company entered into a strategic alliance with bioMerieux SA , which plans to use Gen-Probe's proprietary technologies to develop assays and instruments directed at infectious diseases [See Deal]. Enlisting Chiron as a partner is a coup because Chiron holds the patents to hepatitis C, which is a critical screening test in blood banking.

Furthermore, Gen-Probe is in the final stages of negotiating a contract with the American Red Cross , which handles half the nation's blood donations, to use its probes and technologies to screen plasma donations for HIV and HCV. The ARC, which has leased a laboratory near Gen-Probe's new headquarters in San Diego to centralize its nucleic acid screening, plans eventually to expand the program to all of its blood and plasma supplies.

Gen-Probe's CEO and president Henry Nordhoff is certain that the company's broad array of proprietary DNA technologies, its experience in the field, and its customer-oriented focus are driving its success in finding highly attractive partners who are capable of flourishing in mainstream genetic testing. It has four key technologies, including transcription-mediated amplification (TMA), which carries out different aspects of the analytical process. Moreover, Nordhoff claims that the Tigris, the automated instrument it has under development, is well ahead of anyone else's in terms of ease of use, throughput, and timetable to launch. Says Nordhoff: "Most companies develop automation first, then move to develop the probes. Gen-Probe, on the other hand, developed the probes first, then moved into automation. This has helped us to understand the market and the technology, and to build an instrument that accommodates current technology. The instrument will take less time to develop and will cost less-although more than I thought it would cost."

But if Gen-Probe is moving rapidly in a technological race, its challenge is to live up to its aggressive promises to have a fully automated, easy-to-use instrument available by early 2000. The timetable it presents may seem impressive, but some industry executives snipe that it is unrealistic, especially considering that Gen-Probe does not have expertise in systems design and construction. Gen-Probe may have succeeded beyond expectations so far, but it has never had to contend with anything as ambitious as its current undertaking. It needs to prove that it can manage the high-risk, long-term, heavily competitive projects in which it is now involved.

An Arsenal of Proprietary Technologies

When Gen-Probe was founded in 1983, it was one of a handful of companies working on nucleic acid probes. At the time, Cetus Corp., Gene-Trak Systems Inc.(now a division of Amoco Corp.), Enzo Biochem Inc. and Amgen Inc. were all interested in this new hot field. Industry soothsayers were predicting that diagnostics probes would be a huge business by the next decade. But 10 years later, only Gen-Probe had built a successful and profitable US business supplying DNA probes to clinical laboratories. The others found that developing DNA probes was more complex and costly than they had expected and dropped out or fell behind.

Gen-Probe's founders, Howard Birndorf and Thomas Adams, PhD, both former executives at Hybritech Inc. , (now owned by Beckman Coulter Inc. ) and David Kohne, an independent researcher, were convinced that they had a workable approach. At the time, many scientists didn't believe that ribosomal RNA (rRNA) varied from organism to organism, creating a stumbling block for its use in diagnostics. But Kohne discovered a method of distinguishing the rRNA of different kinds of bacteria. If it worked, the executives believed it would be an excellent target for probe-based tests because unlike DNA targets, it is found in abundance-up to 10,000 copies per cell, compared to DNA, which is present in only one or a few copies per cell. Thus, its proponents believed that tests using an rRNA target would be significantly more sensitive than DNA. It would also be easier to work with than the commonly used double-stranded DNA because it is single stranded and doesn't have to be broken apart in order to be linked up to probes: the heating process used in PCR and some other amplification technologies for separation is not only cumbersome but can also damage strands.

The company went public in 1987, and two years later Chugai Pharmaceuticals Co. Ltd.bought it for $110 million in order to have a window onto the US pharmaceutical market. While Gen-Probe hasn't materialized into a distribution vehicle for Chugai's pharmaceutical products, the subsidiary is a handsome source of revenues and profits and may in the future play a role in disease management projects that Chugai undertakes, says Bruce Huebner, Gen-Probe's EVP and COO. For now, Chugai, realizing it doesn't have expertise in the US market, has taken a hands-off approach; it isn't, for example, playing a strong role in management or funding any of Gen-Probe's R&D programs.

Since the Chugai acquisition, Gen-Probe revenues have grown to more than $90 million, with growth rate in the double digits, and its net income is more than $10 million, says Nordhoff. Company executives attribute its success partly to its portfolio of patented technologies that simplify and improve nucleic acid-based testing. The initial efforts to develop rRNA as a target have been fortified by other proprietary technologies that aid in detection and the analytical process. The Hybridization Protection Assay (HPA) uses a chemiluminescent acridinium ester label, which is a light-producing chemical compound detectable in very small amounts, to improve the sensitivity and specificity of non-amplified probes. The company claims that HPA is comparable in performance to radioisotopes but is much safer to handle. The Target Capture Assay (TCA) helps reduce false negatives by cleaning samples prior to amplification to eliminate elements that could inhibit the reaction.

And the company has expertise in developing combination tests that can diagnose two diseases from one sample simultaneously. Its new innovation, which it calls Dual Kinetic Assay (DKA) and which is a modification of HPA, can differentiate several microbes in one specimen that has gone through one analytical processing because it applies different labels to them.

Gen-Probe's internally developed amplification technology, TMA, can process either RNA or DNA targets, and incorporates some of these proprietary technologies to improve accuracy and ease of use, particularly in the area of sample processing. TMA is faster, more reliable and simpler than competing methods, says Nordhoff.

In fact, Gen-Probe executives believe that the company's simple approach to sample prep is one reason it won the NHLBI grant. Sample prep prior to nucleic acid testing involves extracting and separating the nucleic acid material from the cell. It is currently a cumbersome, time-consuming process, which players in the DNA market are working to automate (see "Qiagen's Coup in DNA Sample Prep,"IN VIVO, April 1998). While the NHLBI earmarked the grant money strictly for assay development, it also took into account the contenders' plans for automation and their approach to pre-analytic processing, noting that the assay would have to be adapted to the high-volume, low-cost environment of blood banks.

TCA, which will be incorporated into the Tigris, removes inhibitors from the samples that impede the amplification process-high concentrations of salt, for example. To do this, it isolates the target nucleic acid that is to be analyzed from a sample, washes the sample, and then returns the target to get it ready for amplification. Gen-Probe is also working on a semi-automated sample prep instrument using TCA, which will be available prior to the Tigris. In contrast, Roche's PCR, TMA's biggest competitor, has a fairly complex chemical extraction method of sample prep that can take hours, says Craig Hill, PhD, manager, scientific affairs at Gen-Probe. Moreover, he contends that PCR and other amplification technologies continue to suffer from inhibition problems that prevent the amplification reaction from working properly.

The Pragmatic Strategist

These lofty goals are a far cry from the realistic, but small-scale projects that occupied Gen-Probe in its early days. The company's practicality was a key factor in its success: it steered clear of the ambitious and costly automated systems that now devour its resources, favoring products that it could get to market quickly.

While Gen-Probe executives claim the company's success is due largely to its arsenal of proprietary technologies, they also credit its responsiveness to customers. This is important, as the nucleic acid market, at least in its infancy, is proving to be quite fickle. A seemingly sure bet, the amplified mycobacterium tuberculosis (MTB) test, for example, hasn't met expectations of manufacturers, even though it cuts the time to diagnose tuberculosis to hours from weeks. Hill speculates that one problem is that the incidence of MTB is declining faster than anyone expected in the US. Yet another likely explanation is the test's labeling-it is cleared in the US for use only on patients who test positive with rapid (sometimes inaccurate) smears-and in that case treatment is started immediately. Thus, it doesn't have obvious cost advantages.

What customers do want, according to Gen-Probe executives, is relief from cost pressures and better medical information that offers a clear and logical argument for introducing more expensive tests. Gen-Probe has more than 35 tests and components on the market, but its best-selling products by far are geared to sexually transmitted diseases, notably chlamydia trachomatis and gonorrhea. In this case, the company's argument for using its tests has caught on. While it also offers amplified tests for chlamydia and gonorrhea, its most popular products are the non-amplified Pace 2and Pace 2C combination tests. These have captured 60% of the chlamydia market in the US and virtually all of the gonorrhea market. Pace 2C, which was introduced in 1994, uses one specimen and one processing step to detect both chlamydia and gonorrhea, and the logic behind its popularity is easy to see. The combination test is just as accurate as individual tests, but it is cheaper and requires less labor and time, says Nordhoff. Yet the laboratories get reimbursed for two tests, as if they were done separately. And while the current Pace tests can't distinguish between microbes, requiring a positive sample to be retested for a specific target, future products will incorporate DKA's distinct labeling process, which indicates the specific microbe present. The company's combination test using DKA will address the problem and should be available next year.

Gen-Probe's separate amplified tests for chlamydia and gonorrhea, on the other hand, are more sensitive but haven't caught on as widely. Because they are so expensive, they are best suited to specialized situations that demand high sensitivity, such as the testing of infertility patients and asymptomatic adolescents, the company says. In a move that signals the increasing medical importance of DNA probes, the AMA last year established separate codes for amplified and non-amplified probes, including chlamydia and gonorrhea. In doing so, it took the unprecedented step of listing several dozen infectious disease agents for which it expects probes to be developed, says Charles Root, PhD, president of Venture Resources, a reimbursement consulting firm. The codes won't necessarily lead to many changes in reimbursement for the tests, since doctors were previously coding the probes according to components, resulting in lists of five or six codes for each test in order to achieve reasonable reimbursement. But the AMA's actions greatly simplify the coding process and are likely to help the acceptance of probes.

Gen-Probe also sells a line of reagents to laboratories for use as home brews and a series of semi-automated detection instruments. But overall, the company's existing markets are mature and, particularly in the case of amplified sexually transmitted diseases, its products face increasing competition from major diagnostics companies such as Roche and Abbott. Only half of the company's revenues growth, which is in the double digits, comes from the current products, says Huebner. The remaining revenues are derived from the NHLBI grant and Gen-Probe's new partners.

Gen-Probe's response to the maturation of its markets has been to move into broader, tougher areas, enlisting the help of well-entrenched players in diagnostics. Through its alliance with bioMerieux, the French microbiology company, it is making a foray into infectious disease testing. bioMerieux, which lacks its own nucleic acid technology, is modifying a series of instruments that incorporate Gen-Probe's TMA as part of its strategy of dominating infectious disease testing. Gen-Probe, for its part, is using bioMerieux's extensive sales and distribution network to help increase sales of its existing products in international markets, which now account for only 10% of the company's revenues, says Huebner (see "Focused Consolidator: bioMerieux,"IN VIVO, May 1998). The sales and marketing arrangement went into effect at the beginning of 1998, and sales are up significantly in Western Europe, says Nordhoff.

In the near-term, the partners are working on a module that can run amplified probe-based assays on bioMerieux's immunoassay system, called the Vidas,without dramatically changing its design or throughput. This is the only project, which attempts to combine immunoassays and probes on one instrument, that is in late stage development and aimed at existing Vidas customers. It is a way for bioMerieux to extend the life of the Vidas and to evolve with customers to the concept of a disease-focused lab, rather than a laboratory revolving around a specific technology for testing, like hematology or microbiology. From Gen-Probe's perspective, the Vidas project gets it in the door of smaller laboratory customers. The first tests are slated to be for sexually transmitted diseases, to be followed by MTB and quantitative viral load tests. The system should be available in Europe sometime next year.

A Blood Bank Bonanza

But even as Gen-Probe places more emphasis on moving into automated DNA systems in the clinical laboratory, perhaps its most intriguing opportunity lies in another direction altogether-the blood banking industry. The Tigrishad already been under development as a clinical diagnostics system when the NHLBI put out its bid. Gen-Probe quickly seized the opportunity and began working to meet the stringent needs of blood banks. In doing so, Gen-Probe is not only reinventing itself but is also threatening to shake up the cozy world of blood banking, now dominated worldwide by two immunoassay-oriented giants, the Ortho/Chiron joint venture (of J&J's Ortho Diagnostics Systems Inc. and Chiron) and Abbott (see "A Coup for Gen-Probe," IN VIVO, July/August 1998).

The opportunity is intriguing for several reasons. Gen-Probe and other proponents of nucleic acid testing in blood banks argue that the current blood supply could be safer because even the most sensitive immunoassays don't pick up contaminated blood from recently infected victims. In HIV, this so-called seroconversion window-the gap between the time when the person is infected and the time the first antibodies appear-is a few weeks. But in HCV, the period can last for three months, making the need for an HCV nucleic acid test particularly pressing.

This position is controversial-opponents argue that the risk of acquiring these diseases from the blood supply is remote given the accuracy of existing immunoassays, and the cost of nucleic acid testing is high. But their protests may be in vain: the advent of nucleic acid testing is being driven by regulation in Europe and the US, where government officials, shaken by previous blood contamination scares, aren't willing to take chances. The European Community has already issued a directive requiring products made from human plasma and sold in the EC to be screened by DNA probes for HCV beginning July 1, 1999. While similar rules aren't in effect in the US, US manufacturers who export plasma products to Europe will have to comply with them. The FDA hasn't yet issued any regulations of this kind because it doesn't usually take action until after a test is approved, regulatory experts say. Nevertheless, it is holding a meeting to explore the current state of HCV nucleic acid testing technology on September 16, and has issued draft guidelines advising manufacturers and laboratories about how to set up studies of nucleic acid based HIV tests.

Furthermore, Gen-Probe's recent deal with Chiron gives it a distinct advantage over the competition. This is because Chiron holds a series of critical hepatitis C patents. It is no accident that Ortho/Chiron and Abbott are the two world leaders in blood banking-they are the only companies in blood banking with licenses to Chiron's HCV patents. But neither, including Chiron's own joint venture with Ortho, has Chiron's permission to use HCV in nucleic acid testing. To be sure, Chiron's agreement with Gen-Probe is non-exclusive, and Chiron says it is considering granting access to HCV to others, but few companies are anywhere close to Gen-Probe in the race to develop a high-throughput blood screening system.

In fact, neither Abbott nor Ortho/Chiron have programs which are well along in developing an automated nucleic acid blood screening system, although Abbott executives say they are looking into the field. The reasons for the apparent competitive inaction aren't clear, but Gen-Probe executives point to the fact that they can devote themselves to the project: other companies have to cover a variety of markets. They speculate that perhaps the larger suppliers were preoccupied with other programs-Abbott was working on the Architectmodular series of instruments, for example. And J&J dropped its nucleic acid program altogether. Chiron's Mickey Urdea, PhD, SVP, nucleic acid diagnostics, says his company studied all of the amplification technologies, but picked Gen-Probe because TMA is simple to use, specific and sensitive, and Gen-Probe is far ahead of others in developing an automated instrument for single unit screening.

The upshot is that the only serious competition Gen-Probe currently faces comes from Roche, whose PCR technology is by far the most widely used amplified nucleic acid testing method. Roche has had a big effort underway for more than a year to develop nucleic acid screening technologies for blood banks. The three-part program includes adapting current PCR assays to be processed in pooled samples from many different donors, using semi-automated instruments. This is an intermediate step until Roche develops a high-throughput fully automated system for single-unit testing, which it expects to be ready for commercialization by 2000. And, Roche is undertaking separately a special project supported by the Japanese government that will result in a prototype system for single-unit blood screening.

Roche, however, doesn't have a license for Chiron's HCV patents. Nevertheless, it has been aggressively selling PCR-based HCV kits to blood banks in Europe as a research tool, arguing that laboratories are clamoring for its test, which is the only one available commercially. Roche's actions have prompted a lawsuit from Chiron. Roche, for its part, is countersuing, and won't discuss the issue. But by blanketing the field with its own tests, Roche might be trying to claim that Chiron is trying to block a medically critical test which only it can provide, a legal argument that may have some precedence, some industry experts say.

Not A Slam Dunk

Gen-Probe executives are optimistically predicting that the bulk of the company's revenues will come from blood screening by 2001. But they can't estimate more specifically the size of the opportunity because no one knows exactly how nucleic acid blood screening will be implemented. Authorities aren't sure whether to screen each of the 50 million units of blood processed by blood banks worldwide per year, or test in pools. The former is costly and time consuming, but effective, while the latter is less expensive and faster but flawed. The pools involve mixing together small amounts of blood taken from many samples and screening the combined mixture. However no one knows the optimal size of a pool-larger pools are cheaper to screen and fewer tests are required, but they are also less accurate than smaller pools containing selections from fewer samples. Nevertheless, pooling is increasingly viewed as the best near-term method of screening until automated technologies like the Tigrismake high-throughput single unit screening possible.

The EC directive permits pools, but doesn't specify the size of the pools, and different countries are likely to enforce different requirements. The Netherlands, for example, is looking at combining no more than 48 samples in a pool, a relatively small amount, but other countries are looking at pools combining 128 units.

Gen-Probe, for its part, is designing the Tigristo be applicable to single-unit screening. The instrument is a walk-away system with throughput capabilities of 500 tests per 8-hour shift, ramping up to 1,000 tests in a 12-hour shift. Gen-Probe is working with an OEM supplier, Rela, to make the instrument, and hopes to start clinical trials with it next year, getting it to market in late 1999. The first tests will be the combined HCV/HIV test, a quantitative HIV viral load test, and a combined chlamydia/gonorrhea test.

The project is by no means a "slam-dunk," Nordhoff warns. Gen-Probe has had to learn to work with Center for Biologics Evaluation and Research, which monitors the blood supply, and with an OEM supplier which itself has undergone significant change in order to meet Gen-Probe's needs-Rela was a small software and engineering house when Gen-Probe started to work with it more than two years ago. And while Gen-Probe is on the verge of clinching a deal with the American Red Cross, it views that deal as a demonstration rather than a money-maker, at least in the initial stages.

Expanding Clinical Opportunities

If Gen-Probe seems to have a sure head-start in blood banking, it faces much stiffer competition in the clinical diagnostics arena as it gets involved in the race to automate DNA testing in the clinical laboratory. While it has done some work on its own to develop tests for cancer and infectious diseases, it now has two strong partners in this field, bioMerieux and Chiron. On the other hand, because of fierce competition, it, like other contenders, has little margin for error technically or strategically-witness companies which have had to drop out of the race, like J&J, or those which are struggling, like Akzo Nobel NV 's Organon Teknika NV.

Gen-Probe executives don't foresee conflicts between the bioMerieux and Chiron partnerships and say on the contrary that they complement each other by getting Gen-Probe involved in different aspects of DNA testing. The bioMerieux deal in the area of infectious diseases basically allows bioMerieux to incorporate TMA into systems developed by bioMerieux. While the Vidasmodule is aimed at small laboratories and designed for amplified DNA probes that already exist in other formats, bioMerieux has a longer-term, more ambitious goal of combining TMA with DNA chips on a new instrument which it is developing. BioMerieux has exclusive rights to DNA chips made by Affymetrix Inc. for use in bacteriology [See Deal]. The intent is to be able to detect hundreds of targets simultaneously, which is particularly useful for infectious disease experts who at the onset may not know what target they are looking for. The instrument will be able to simultaneously diagnose infectious diseases and do susceptibility testing to determine antibiotic resistance. It is probably three to four years away from completion, says an Affymetrix executive.

And while competitors are following similar strategies, Gen-Probe executives are convinced it has the best approach. Roche also has a license to use Affymetrix' chips, but Roche's deal is non-exclusive and covers only viral applications. Becton Dickinson & Co. is also incorporating its internally developed amplification technology onto a chip-based instrument using chips developed by its strategic partner Nanogen Inc. [See Deal]. But Gen-Probe, while not in a formal partnership with Affymetrix, surveyed many chip technologies and concluded that Affymetrix has the most extensive patent portfolio and is far ahead of others in its development process, says Nordhoff. "It has solved a lot of problems that other companies are just beginning work on, like hybridization on a chip."

If the bioMerieux deal revolves around bioMerieux-built systems, Gen-Probe's deal with Chiron calls for Chiron to sell Gen-Probe's systems and assays to clinical laboratories and blood banks, and thus has greater upside potential for Gen-Probe. While the bioMerieux deal covers both an early initiative to get automation off the ground and a longer-term project, the Chiron deal gets Gen-Probe into the middle-ground-the mid to large clinical laboratory interested in straightforward automated DNA testing. It calls for Chiron to market a Gen-Probe built system to clinical laboratories for use in certain infectious disease and cancer diagnostics. The instrument will be the Tigris, modified to fit the clinical lab rather than blood bank needs.

Perhaps the biggest uncertainty in the Chiron deal is the fate of Chiron Diagnostics Corp.Chiron Corp. is seeking a strategic partner or buyer for its diagnostics subsidiary, and as a result the sales strategy appears to be unclear in the near-term. The parent company intends to keep rights to the HCV patent, and handle the sales strategy for the blood banking business, but the buyer or strategic partner of Chiron Diagnostics is likely to assume responsibility for selling Gen-Probe's instruments to clinical laboratories, a responsibility which on the clinical side, will be shared by Gen-Probe (Gen-Probe won't be selling to blood banks).

Stepping Up to the Plate

If Gen-Probe's focus and pragmatism helped it corner the DNA probe market while other companies struggled, its contract with the NHLBI signaled a new phase in its evolution and in the evolution of the probe industry. The award signaled to many people that nucleic acid screening of blood banking products was not just a pipe dream. And, it indicated that Gen-Probe was not just a one-trick pony with a few good test kits. On the contrary, it showed that the company could pay close attention to its markets and move swiftly. Gen-Probe jumped on the opportunity. It promised to develop a combined amplified HIV/HCV test, which would be more sensitive and save on labor. And because Gen-Probe was already selling combined probes, the NHLBI felt it had the best shot at making such a product a reality. Moreover, the agency was impressed by the Tigris, which could process up to 1000 tests in 12-hour shift, had fully automated sample prep and would be ready for market in 2000.

Now Gen-Probe has to live up to its promises. Like everyone else in this business, it is going to face enormous competition, most notably from Roche, leaving little margin for error. Gen-Probe's understanding of the technology and the customer base is helping it in the design and development of its instruments and probes, as well as in attracting top-flight partners. It has come out ahead in several patent challenges, notably from the Vysis Inc. subsidiary of Amoco. It has a parent with deep pockets, which could, in a pinch, help out, although that hasn't been necessary. It has been able to keep development costs under control-the price tag for the Tigris is less than the $50 to $100 million companies usually spend on building new systems, says Nordhoff, and the funding is coming from Gen-Probe sales, as well as bioMerieux and Chiron. As it gets more engrossed in the mainstream DNA diagnostics race, the skills it needs to survive are shifting. It is, for example, gaining an understanding of building systems, something that doesn't come naturally to a chemistry-oriented house. It is also juggling several important partnerships at once. And Gen-Probe appears to be acquiring one of the most critical skills in business-the ability to manage change.