Blue Heron Biotechnology Awarded SBIR Grant.

Business Editors & Health/Medical Writers

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BOTHELL, Wash.--(BUSINESS WIRE)--Feb. 5, 2003

Blue Heron Biotechnology, Inc. announced today that the Company has been awarded a $2.4 million grant from the National Institute of General Medical Sciences.

The Phase II Small Business Innovative Research (SBIR) grant will accelerate Blue Heron's ongoing research in gene synthesis and help to enhance its GeneMaker(TM) automated gene synthesis platform. GeneMaker was developed to provide researchers with a high-quality service that offers fast, inexpensive access to any DNA sequence. In early 2001, GeneMaker was launched commercially to provide researchers with full-length genes on a fee-for-service basis. Today, over 40% of the top pharmaceutical and biotechnology companies worldwide buy synthetic genes, gene fragments and gene variants from Blue Heron.

Although sequencing of the human and other genomes has increased the number of medically relevant gene sequences by five- to ten-fold, scientists cannot begin laboratory research until they obtain the actual DNA molecules. Up to half of these DNA molecules may be difficult to obtain using traditional methods. With GeneMaker, researchers can access every sequence needed for experiments, including sequences that would otherwise be difficult or impossible to obtain. GeneMaker has built hundreds of full-length genes and thousands of gene fragments with perfect accuracy, including sequences with 98% G-C content or with sizes exceeding 10,000 base pairs.

Under the grant Blue Heron will build, test and refine an automated DNA synthesis system capable of unattended production of 20,000 base pairs per unit in 12 hours. The instrument will be based on the novel and innovative technologies for gene assembly developed in the Phase I portion of this research. It will be commercialized in 2004 by incorporating it into the existing GeneMaker gene synthesis manufacturing.

"We view this very substantial SBIR grant as a validation of our technological approach and of the value of gene synthesis. Our vision is that reliable, high-throughput gene synthesis can improve the efficiency of biological research and pay dividends across a broad range of research programs. During the next two years we will produce over 500,000 base pairs of synthetic DNA in the test system alone. Integrating this new technology into our commercial manufacturing process will substantially expand our synthesis capacity," stated Dr. John Mulligan, President and CEO.

About Blue Heron Biotechnology

Blue Heron Biotechnology, Inc., the leading provider of gene synthesis services, was founded in 1999 to accelerate discovery research by industrializing the manufacture of custom reagents. Custom reagents are a natural extension of the $3.9 billion life science reagent market, saving the typical research organization a significant amount of time and resources. Blue Heron's proprietary GeneMaker(TM) synthesizes any gene, regardless of sequence or size, with 100% sequence fidelity guaranteed. Today over 40% of the top pharmaceutical and biotechnology companies worldwide buy synthetic genes, gene fragments and gene variants from Blue Heron.