Article courtesy of the St.Louis Post Dispatch...

Divergence receives $637,000 grant for parasitic roundworms research

By Rachel Melcer
Of The Post-Dispatch

Divergence Inc., a biotech startup in Creve Coeur, won votes of confidence this week from both scientists and investors.

The company - which is developing ways to control parasitic roundworms that harm people, plants and animals - was chosen through a peer-review process to receive a two-year, $637,000 research grant from the National Institute of Health's National Institute of Allergy and Infectious Diseases. It is the company's third federal grant.

Divergence also was selected by 41 health-care venture capital firms to present its business plan at the BIO VentureForum next month in San Francisco. Divergence is the only St. Louis company among 131 early-stage biotechnology companies participating. More than 350 firms applied, according to the sponsor, the Biotechnology Industry Organization of Washington, D.C.

"Participating . . . provides an opportunity for Divergence to meet and bring its story to sophisticated life sciences investors - and that can only be helpful for a company that may, on occasion, be seeking funding," said Chief Executive Derek Rapp.

Three-year-old Divergence has raised nearly $5 million in angel and venture funding. But biotechnology takes years to develop and pass through regulatory procedures. If all goes well, Rapp said, Divergence could have a product on the market "well in advance of the end of this decade."

Raising grant money that doesn't require an equity stake in the company wins favor among Divergence's existing investors, Rapp said. But he is even more pleased because it comes from fellow scientists.

"In this peer-review process, (scientists) are reviewing our grant application and deciding that what we are doing merits funding and recognition," he said. "I hope it serves as validation of the good science that is happening at Divergence."

Reporter Rachel Melcer: \E-mail: rmelcer@post-dispatch.com \Phone: 314-340-8394

Published in Business on Friday, September 20, 2002
ARTICLE: Copyright(c) St.Louis Post Dispatch. All rights reserved.