Cytomation: Small biz with long reach

Biotech company markets cell-sorting tool around world

Cytomation CEO Nigel Ferrey uses a bit of the Old World to define his company’s work.

“We’re tool makers,” he says.

That description, apt as it is, sounds quaint. But make no mistake, Cytomation is firmly rooted in the present and poised for the future, as evidenced by the tool it makes.

The tool is a sophisticated biotechnical instrument called a flow cytometer. It identifies and sorts individual cells, blending such diverse technologies as laser-optics, electronics and fluidics.

The instrument, dubbed the MoFlo, isn’t the only flow cytometer on the market. It is the fastest, Ferrey said.

Cytomation has boosted by as much as 10-fold the speed at which cells can be identified and sorted. Depending on the type of cell, Cytomation’s MoFlo can sort as many as 100,000 cells per second.

“We do the job of sorting cells more quickly and efficiently than anyone else in the world,” Ferrey said.

That speed opens up new possibilities, said Cytomation customer Karen Helm. Helm manages the Cancer Center Flow Cytometry Core at the University of Colorado-Denver. The three-year-old MoFlo in her facility is 10 times faster than the machine it replaced.

“That makes it possible to do experiments we couldn’t do before because we can sort in two hours what would have taken 20 hours to sort before,” Helm said. With the older technology, “all the cells would have died before we got them sorted.”

In Helm’s facility the MoFlo is used by as many as 100 different researchers each year, largely for cancer research. Applications for the tool, however, are much broader, ranging from sperm sexing to HIV research to the burgeoning field of drug discovery.

Since it began offering the MoFlo for sale in 1994, Cytomation has sold more than 165 machines to research facilities worldwide, including sites in Canada, Europe, Japan, Australia and Argentina.

The machines are custom-configured for each client’s specific research needs and range in price from about $200,000 to $500,000. Large, complex and long lasting, “these are cornerstone pieces of instrumentation in a research lab,” Ferrey said.

Ferrey is building his firm’s future not just on the jaw-dropping technological advances that have spurred the MoFlo, but on the commercial applications its rapid sorting abilities enable.

A three-pronged strategy of research and development, sales and marketing and entrepreneurial activities is positioning Cytomation for a healthy future as the technology leader in the field, Ferrey said.

He lines it out: “We go outside and look for technology … clever ideas. We develop cutting-edge instruments and sell them worldwide to the research community. And then we apply this technology to appropriate commercial areas in a way that allows each one to have its own identity.”

Already Cytomation has incorporated XY Inc., a daughter company involved in sperm-sorting for livestock breeders. XY Inc., Ferrey said, has its own identity, its own mission and its own market. “But it’s all enabled by the proprietary technology of high-speed cell sorting.”

A similar entity could take shape around drug-discovery efforts, Ferrey said.

The tool builders are building even more than flow cytometers, related equipment and new business endeavors. In September the company broke ground on the first of three phases of a $7 million, 80,000-square-foot campus planned on eight acres in southeast Fort Collins.

The first phase will more than double Cytomation’s existing 11,000-square-foot manufacturing facility, which is adjacent to the new site.

This physical expansion accommodates a growing staff ã employee numbers have more than doubled over the past two years to 113 worldwide. In Cytomation’s Fort Collins headquarters, 92 employees are engaged in the work of research and development and manufacturing. Cytomation also maintains sales offices in Freiburg, Germany, and Melbourne, Australia.

Cytomation has roots in Australia. Founded in 1988 by three Australians and an American, its original mission was to improve flow-cytometer performance. In the firm’s early days it developed and marketed an add-on software and electronics product, Ferrey said.

By 1992, Cytomation was looking for a new business strategy. “To really make this a serious company, we really needed a complete instrument,” Ferrey said.

In 1993, the company licensed the technology for a modular flow cytometer from Lawrence Livermore National Laboratory. The flow cytometer was developed to help speed the sorting of human chromosomes as part of the Human Genome Project.

In Cytomation’s early days, the toolmakers were like carburetor builders, Ferrey said, using an analogy to describe the company’s evolution. Today, they build the whole engine.

Looking ahead, Ferrey expects to end 2000 with revenues “somewhere north of $20 million. He projects revenues of $30 million in 2001, $50 million the following year. Employee numbers will swell, too. An initial public offering could loom as well.

The growth he envisions relies on attracting “simply the best scientists worldwide,” and Ferrey has focused on building Cytomation internally.

To do so, Ferrey cultivates a culture at Cytomation which he describes as the best of both worlds: A fertile technological environment and a quality work environment: “Where people can have all of the intellectual excitement they had coming out of the university in the context of a business that has upward potential for their own careers. And they can actually afford to retire some day.”

The culture at Cytomation is not just for its scientific staff, however.

Ferrey describes an “upside-down” organization in which management works for employees.

“I work for everybody. It’s my job to empower them and it’s the job of their supervisors to empower them to do great things,” he said of his staff.

At Cytomation, empowerment is driven by communication, Ferrey said; ensuring everyone is pointed in the same direction and everyone understands the science, the strategy and the culture.

Cytomation’s culture and size appeal to customers such as Karen Helm.

“They’re very customer-friendly and accessible because they are a small company,” Helm said. “They’re great to work with as a business. Their equipment is designed by people who know this science and have just made it easy to do the job we have to do.”

With a price tag that can push a half million, Cytomation is acutely aware that the MoFlo flow cytometer represents a major investment in research infrastructure, Ferrey said.

It comes with this exhilarating extra, however: “What’s exciting is almost not what’s done, it’s what we can do and what we will do in the future. It’s what I tell clients … ‘What you’re buying today is good, in fact it’s great. But what you’re really buying is something that’s going to ensure in the future that you’ve got the tools you need to do the things you’ve yet not thought of.'”

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