TRW Technology Plays Key Role in Genomic Race.

Business Editors & Health/Medical Writers

BIOWIRE2K

RESTON, Va.--(BW HealthWire)--March 24, 2000

When Paracel Inc. agreed to be acquired by Celera Genomics Corporation, technology developed by TRW Inc. (NYSE: TRW) for national security took on a new mission - helping discover and document human gene sequences.

Paracel was founded in 1992 with advanced information filtering technology developed by TRW. In exchange for an exclusive license to its Fast Data Finder(R) technology, TRW received equity ownership in Paracel. Paracel adapted FDF technology, originally used by the military to handle large quantities of electronic text in multiple languages, to develop products in text and genomic data analysis and become a leading bioinformatic vendor.

In a stock-for-stock deal valued at some $283 million (exact value to be calculated at closing), Celera Genomics, a PE Corporation business, announced this week it had signed a definitive merger agreement to acquire Paracel.

"One facet of TRW's strategy is to spin-out a subset of the myriad world-leading technologies developed in our defense sector," said Dr. Donald C. Winter, executive vice president & general manager of TRW Systems & Information Technology Group in Reston, Va. "We can commercialize a larger percentage of our technologies through technology transfer, and we can create - through the successes of these spin-outs and our equity participation - substantial value for our shareholders. We view Paracel's success as a validation of this strategy."

In one of its first efforts to commercialize technology, TRW agreed to license FDF to a new company formed by its inventor, Dr. Kwang-I Yu, then a TRW Technical Fellow. TRW has retained a more than 10 percent ownership in Paracel on a fully diluted basis and has a member on Paracel's board of directors. TRW also retains the right to incorporate the FDF technologies in systems that it develops for the Federal government.

Winter describes Paracel as the first big success spawned from TRW's "information technology bank," the forerunner for a number of technologies emerging in the TRW pipeline. Those ventures include continuing collaboration with Paracel, pursuing large-scale commercial text analysis efforts.

"I am very grateful to TRW for its sponsorship of Paracel at its formation and as a strategic partner throughout our years of development," said Kwang-I Yu, chairman, president and CEO of Paracel Inc. "Our TextFinder(TM) and GeneMatcher(TM) product lines are descendents and adaptations of TRW technology, and we fully expect to continue our partnership with TRW after our merger with Celera. This is a clear case of the successful transfer of defense technology into one of the most important commercial arenas of the 21st century - genomics and biotechnology."

At its essence, the FDF is a special-purpose, massively parallel supercomputer capable of complex pattern matching in text and other character data types. Through collaboration with the California Institute of Technology, FDF was first applied to genomic data comparison in 1990.

TRW Inc. provides advanced technology products and services to the automotive, aerospace, and information technology markets worldwide. TRW's 1999 sales were $17 billion. For more information, visit http://www.trw.com .

Paracel Inc., founded in 1992, provides high-performance genomic and text analysis systems for the pharmaceutical, biotechnology and government markets. Paracel is a privately held company located in Pasadena, Calif. More information about Paracel is available at http://www.paracel.com .