SAS Spins Off New B2B Internet Company for Biomedical Research

Business Wire, May 26, 2000

Business Editors/High Tech Writers

CARY, N.C.--(BUSINESS WIRE)--May 26, 2000

iBiomatics Will Speed Drug R&D

Through the Use of Information Technology

SAS Institute, the market leader in Web-enabled data warehousing and decision support, announced today that it has spun off its first business-to-business Internet company.

iBiomatics LLC, a wholly owned subsidiary of SAS, will enable researchers in the life sciences industry to better understand and predict the safety and effectiveness of drugs and medical devices at Internet speed. This spin-off takes on greater significance now that scientists have almost finished mapping the human genome. Biotech and pharmaceutical firms, already over-burdened with research data, now must handle huge volumes of genetic information to develop new therapies.

By unifying anonymous data and knowledge about specific drug projects and making it available through secure Internet portals, iBiomatics will accelerate medical research. This will benefit patients by saving time and money in drug development. According to Kenneth Kaitin, Ph.D., director of the Tufts Center for the Study of Drug Development at Tufts University, it takes about 14 years and costs half a billion dollars to bring a single new drug to market. "Pharmaceutical companies need to shorten development times and reduce R&D costs to be successful in the current competitive marketplace," he said. "Using Internet technologies to leverage all of the data about a single drug development program will help them accomplish that."

"Packaging and delivering research information over the Internet changes the structure of biotechnology and drug development," said Lee Evans, president of iBiomatics and previous executive director of SAS PharmaHealth Technologies. "For the first time, research organizations of all sizes will have access to biomedical information through a Web browser. They can focus on scientific research, and iBiomatics will deliver, leverage and add value to their information."

"Since information is now the primary catalyst and currency of any marketplace, we believe that the growth of other markets will pale in comparison to that of bioinformatics over the next decade," said Doug Laney, vice president of the META Group, an IT advisory services firm. "The forthcoming deluge of information from unraveling the genome, matched with the accessible analytic output from collaborative biomedical research ventures like iBiomatics, will enable unfathomable advances in life sciences and spawn countless ancillary industries."

Why a spin-off? A more focused approach

To Dr. Jim Goodnight, president and CEO of SAS, spinning off the new company makes sense. "SAS has been a catalyst for speeding research in the pharmaceutical industry for more than 20 years," he said. "This spin-off represents the best of both worlds. iBiomatics will be able to move with the speed and agility required in today's rapidly changing life sciences industry, and will have the rock-solid foundation of SAS."

iBiomatics includes the staff and technologies of the SAS PharmaHealth Technologies business unit, which will become a division of iBiomatics. The new subsidiary will remain part of the SAS family. In addition, SAS will provide iBiomatics access to its data warehousing and decision support software, and the R&D behind it.

"iBiomatics will provide a valuable addition to SAS' corporate portfolio and will build a major new channel to extend the company's technologies into the burgeoning life-sciences market," said Andre Boisvert, vice president of business development and strategic investments at SAS. "As an outside director of iBiomatics, I'm looking forward to putting together a world class board of directors to solidify this company's place in the life sciences industry."

The market and opportunity

According to PricewaterhouseCoopers, industry sources suggest the pharmaceutical and biotechnology industries worldwide spent more than $43 billion on R&D in 1999. Information technology investments account for between 12 and 15 percent of that sum, Evans said. The $500 million development price tag for each marketed drug continues to rise, and the main culprit is a research process that operates without an efficient, electronic system for managing, archiving and reviewing analysis-ready data. PricewaterhouseCoopers estimates that drug development companies can save $200 million per marketed drug by deploying what it calls "e-R&D," a term that describes the computerization of the R&D process.

"Scientists need Internet-enabled medical research systems to develop better, more targeted therapies," Evans said. "They'll find that with iBiomatics."

About SAS Institute

SAS Institute, the world's largest privately held software company, is the leader in decision support and data warehousing, providing integrated enterprise information-delivery solutions and e-business solutions. SAS markets packaged business solutions for vertical industry and departmental applications, as well as an integrated suite of software tools and consulting services. These allow companies to transform the wide variety of data within their organizations into information that business users and researchers need to make better decisions. SAS software and services are used at more than 33,000 business, government and university sites in 110 countries. SAS' 1999 revenues totaled $1.02 billion.