In October 2000, Affymetrix Inc. formed Perlegen Sciences Inc. as a subsidiary, and the fledgling company set about raising $100 million in what it called its Series B round of financing. Back then, genomics was hot and companies with solid science found the financing trail smooth.

Things have changed since then.

But even in a "more cautious and more conservative" financing environment, said Perlegen CEO Brad Margus, the company had a story good enough to raise $30 million from existing and new investors.

"It's a different environment from March 2001 when we [closed] our first round," he told BioWorld Today. "There is still a lot of money out there but the key is to differentiate yourself from others."

Mountain View, Calif.-based Perlegen has done that since its beginning. Its $100 million round in 2001 placed it in the top five of that year's list of highest private-financing rounds. Also, being linked to Affymetrix, a leader in the field of DNA arrays, helped set the young company apart. (See BioWorld Today, Oct. 4, 2000, and April 4, 2001.)

The $30 million, Margus said, will be used to "commercialize the technology we have developed so far."

"[Perlegen] finds the genetic basis of diseases and drug response," he said. "With this financing, we will scale that up and do more genetic association studies."

The company's technology places high-density arrays of DNA probes on glass wafers. Each wafer holds about 60 million DNA probes that can be used to recognize longer sample DNA sequences. The company examines which probes the sample DNA hybridizes to more strongly to determine if a known sequence of DNA is present in the sample DNA. The work allows Perlegen to identify genes that are implicated in disease and also genes that affect the body's response to drugs.

The technology "can add value downstream in the drug development" process, Margus said, and the fact that it is "not only unique, but working today" helped Perlegen raise the funds. But investors could also look at the recent spate of partnerships the company has formed as a form of validation for Perlegen's platform, Margus said.

In December, Perlegen signed deals with Eli Lilly and Co., of Indianapolis, to identify genetic markers for Lilly; with Pfizer Inc., of New York, to discover the human genetic contributions to cardiovascular disease; and with Bristol-Myers Squibb Co., of New York, to identify markers of patient response to medications in Bristol-Myers' portfolio. And while those agreements mark the progress the company has made, Margus said the company also has reached every self-set milestone, "in spite of the terrible financial climate."

The company in March completed 50 different human genomes. It has finished the human haplotype map. And it developed a platform for genotyping 1.7 million single nucleotide polymorphisms in thousands of people.

"Those were in our business plan at the start," Margus said.

Affymetrix is fairly intertwined with Perlegen. Margus described his company's technology as "a souped-up version" of Affymetrix's platform, and said Affymetrix is the manufacturer and supplier of Perlegen's wafers and chips. Affymetrix's third-quarter financial statement shows that Affymetrix received $4.9 million from Perlegen for wafer sales. For the first nine months of the year, Affymetrix received $16.5 million from Perlegen.

The $30 million is expected to last, conservatively, through early 2005, Margus said. With the round behind him, it's on to other things.

"The immediate reaction is that we can stop focusing on raising money and focus on commercializing and building value," he said. "We think we're sitting on a technology that can make an extraordinary contribution to medicine and science."

The financing was led by Maverick Capital, of New York. New investors included Eli Lilly and Co.; Biofrontier Partners, of Tokyo; and CSK Venture Capital, also of Tokyo. Also participating were Vulcan Ventures, of Seattle; BioMedical Sciences Investment Fund, of Singapore; CMEA Ventures, of San Francisco; SB Life Science Ventures; the individual Alejandro Zaffaroni and others.