Venture Update Vol VI, #4, April, 2002

Done Deals

RTP - Caspian Networks (www.caspiannetworks.com), a communications network hardware provider, secured $120M in fourth round financing bringing total investment in the company to $262 million, according to the Triangle TechJournal. Existing investors US Venture Partners, New Enterprise Associates and Merrill Lynch, participated in the round, along with new investors Morgenthaler and Oak Investment Partners. Caspian was incorporated in February 1999 and is now headquartered in San Jose, while maintaining significant R&D offices in Research Triangle Park. Contact: Bill Sickler (919.547.1000)

Morrisville - Gentris Corporation (www.gentris.com), which advances and applies the science of pharmacogenomics (the study of patients' response to drug treatment based on individual genetic variations) to clinical drug development and point-of-care diagnostics, raised $1.5 million in its initial round of funding from Exelixi, a publicly held biotechnology company, and Research Triangle Ventures. The funds will be used to accelerate its product development and marketing efforts. The company has six employees and expects to hire five or six more this year. Gentris is set to present at CED's upcoming Venture 2002 conference. Contact: Michael Murphy (919.465.0100)

Raleigh - Salix Pharmaceuticals, Ltd. (www.salixpharm.com) (Nasdaq:SLXP), a developer of prescription drugs for the treatment of gastrointestinal diseases, announced that the underwriters of its recent public offering of common stock exercised their over-allotment option and purchased from Salix an additional 600,000 shares. After giving effect to the over-allotment shares, a total of 4,600,000 shares of common stock were offered and sold in the offering. This transaction brings the total gross proceeds of the offering to $61.5 million. The net proceeds to Salix were approximately $57.4 million. With the addition of these funds, as of this date, the company's cash, cash equivalents and investments exceed $80 million. Contact: Michael Freeman (919.862.1000)

New Developments

RTP - Quintiles Transnational Corp. (www.quintiles.com) (Nasdaq: QTRN), the world's leading provider of information, technology and services to bring new medicines to patients, acquired certain assets of Bioglan Pharma Inc., the U.S. subsidiary of U.K.-based Bioglan Pharma Plc, in a transaction valued at approximately $26.7 million. As part of the agreement, Quintiles also has acquired Bioglan Pharma Inc.'s rights to certain dermatology products now on the market in the U.S. These products complement Quintiles' purchase of the North America commercialization license for Solaraze (TM) Gel, a topical treatment for the pre-cancerous skin condition actinic keratosis. Bioglan Pharma Inc., based in Malvern, Pa., has about 45 employees in the United States. Contact: Pam Kirby (919.998.2002)

Raleigh - Nitronex Corporation (www.nitronex.com) plans to increase its employee count from its current level of about 55 to close to 100 by the end of the year, according to Bob Lynch, president and chief executive officer. Nitronex will look to add engineers, technicians, and production people. Contact: Bob Lynch (919.807.9100)

RTP - Red Hat founder Bob Young has started a new venture that just acquired Raleigh's OpenMind Publishing Group, reports the Triangle TechJournal. The well-known founder and early leader of Red Hat who made millions from his sales of Red Hat stock after the firm went public recently started a new company called Lulu, Inc. (www.lulu.com). Lulu Incorporated has bought the assets of online textbook publisher OpenMind Publishing Group. Financial details of the deal were not available. OpenMind was a Dot Com founded in 1999 and was launched out of the Fusion Ventures Incubator in Durham. The firm created online versions of textbooks that can be changed and edited by professors through an online interface created by OpenMind. Contact: Bob Young (919.547.0012)

On The Up

TogetherSoft
Dedicated to improving the ways people work together, Raleigh-based TogetherSoft (www.togethersoft.com), is already working for more than 4,000 customers. The software development tool vendor has already landed million-dollar deals with leading companies such as J.D. Edwards, Network Computer House in Italy, and Fannie Mae and had revenues of $47 million in 2001 (up 81 percent from 2000).

TogetherSoft is poised to release the Version 6.0 of its product, the Together ControlCenter this spring. The company has also opened six European subsidiaries - Germany, Benelux, Italy, France, Finland and the Czech Republic - and a new Canadian subsidiary to complement its current U.S. and United Kingdom offices. In addition, the company has moved into the Asia-Pacific Rim with an office in Tokyo, Japan.

Funding history includes $20 million from TA Associates. In February 2002, the role of TogetherSoft's founder, Peter Coad, changed from CEO to Chairman and Chief Strategy Officer. John R. "Beau" Vrolyk, a 30-year business veteran and member of the TogetherSoft board, currently serves as interim CEO. Poising itself for continued growth, TogetherSoft has recruited and obtained other key members of management in 2001, adding additional talent and results-driven experience to its executive team.

"We have an extremely passionate, and visionary founder and strong leadership in our management and board," says Grace W. Ueng, the company's vice president of marketing. "We are passionate about wanting to capture every developer's desktop."

Look for TogetherSoft as it presents at CED's upcoming Venture 2002 conference.

Contact: Shawn Ramsey-Kroboth (919.865.0576 or shawn.ramsey-kroboth@togethersoft.com)

In the Pipeline

Genomics Consortium Update: Work Begins On N.C. Biogrid Development

Biotechnology researchers are producing such massive amounts of genomic data that the information-technology industry is hard-pressed to store, analyze and share it. Technology leaders in North Carolina hope a solution lies in a new statewide computer grid that will provide computing, data storage and networking resources for academic and industrial research labs.

The N.C. BioGrid will provide distributed computing and data storage resources to Consortium associates and other research labs over MCNC's high-speed North Carolina Research and Education Network (NCREN). The BioGrid will allow users to share genomics, proteomics, and related data as well as the computing resources needed to analyze the data.

"The BioGrid will do this so transparently that scientists will think the data resides on their workstations when, in reality, it may be distributed to many sites across the state," said Dr. Thomas Dunning Jr., vice president of high-performance computing and communications at MCNC, in an earlier news release.

Distribution of data sets among academic and industrial labs will allow each set to be managed by an institution with the appropriate expertise. Sharing computing resources will mean that researchers will be able to use on-campus computing resources more efficiently while getting access to shared off- campus resources, including the high-performance computers at the North Carolina Supercomputing Center, a division of MCNC.

All of these services will be provided by a sophisticated layer of software, referred to as "middleware," that provides the intelligence needed to turn NCREN into the N.C. BioGrid.

When completed, the N.C. BioGrid will run on one of the world's most powerful servers, the IBM eServer p690 - code-named "Regatta" - which can process a trillion operations per second. IBM's Enterprise Storage Server, code-named "Shark" - will provide data storage, access and security for more than a petabyte of data - the equivalent of one billion books, 400 pages each.

The first phase of the BioGrid project will be a test bed to gauge software and better understand the issues of storing, analyzing and moving large bioinformatics data sets in a high-speed, networked environment. The test bed should be ready by this summer, and the BioGrid should be fully operational within two to three years.

CED thanks Barry Teater and the NC Biotech Center for their update on the N.C. BioGrid.

Springboard: Southeast 2002

CED has been recruited to host the first Springboard Southeast Venture Forum, showcasing high-growth women entrepreneurs, the country's fastest growing - but untapped - entrepreneurial sector, on September 27, 2002.

Launched in San Jose in January 2000, Springboard has showcased 215 women entrepreneurs at eight venture forums. Presenters to date have raised nearly $700 million in equity capital for their businesses.

CED will be working with technology organizations, investors, and women's business champions in the Carolinas, Florida, Georgia, Tennessee, Alabama, and southern Virginia to identify, select and coach the most promising companies, who will present to a national audience of investors.

CED's co-hosts for this landmark event are Springboard Enterprises and the Kenan-Flagler Business School at The University of North Carolina at Chapel Hill.

Springboard will be officially launched April 16 at the DuBose Home & Rizzo Conference Center in Chapel Hill.

For more information, contact Holly Rice at hrice@cednc.org.

Mark Your Calendar!

Venture 2002
April 30 - May 1, 2002
The Friday Center
Chapel Hill, NC

Biotech 2002
May 20, 2002
The Sheraton Imperial
RTP, NC

Entrepreneurial Excellence Awards
June 4, 2002
Entertainment & Sports Arena
Raleigh, NC

For more information, visit the CED Web site (www.cednc.org) or call 919.549.7500.

CED is a private non-profit organization supported, in part, by corporate contributions, including funding from Kauffman Center for Entrepreneurial Leadership at the Ewing Marion Kauffman Foundation and Kilpatrick Stockton, L.L.P.

Research Triangle Venture Update is published by the Council for Entrepreneurial Development (CED), a non-profit organization located in Research Triangle Park, N.C.