CEO Interview: CombiMatrix Corporation - Dr. Amit Kumar

• On 1:12 pm EDT, Tuesday October 20, 2009

67 WALL STREET, New York - October 20, 2009 - The Wall Street Transcript has just published its Biotechnology Report offering a timely review of the sector to serious investors and industry executives. This 70-page feature contains expert industry commentary through in-depth interviews with public company CEOs, Equity Analysts and Money Managers. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

Topics covered: Heightened M&A Activity - Trend Toward Orphan Disease Drug Development - Generic Drug Competition - Current Length Of FDA Approval Process - Ownership Ego Preventing Shareholder Returns - IPO And Secondary Offering Window Opening - Big Pharma R&D Pipeline - Decreased Clinical Development Risk - Impact Of Health Care Reform - Convergence Of Large-Cap Biotech And Pharmaceutical Companies - Easier Credit For Small Cap Biotech Companies - Developments In Cancer Chemotherapeutics - Gene Delivery Technology

Companies include: ADVENTRX (ANX); Abbott Labs (ABT); Advaxis (ADVX); Amedisys (AMED); Amgen (AMGN); Amylin Pharmaceuticals (AMLN); Antares Pharma (AIS); BioDelivery Sciences (BDSI); Biogen Idec (BIIB); Biomarin (BMRN); Boston Scientific (BSX); Bristol Myers (BMY); CVS Caremark (CVS); Celgene (CELG); Cerner (CRN); Cerus (CERS); Coke (KO); CombiMatrix (CBMX); Coventry Health Care (CVH); DARA (DARA); Eisai (ESALY); Eli Lilly (LLY); GenVec (GNVC); Gilead (GILD); GlaxoSmithKline (GSK); Health Management Associates (HMA); Human Genome Sciences (HGSI); Inspire Pharmaceuticals (ISPH); Intellect Neurosciences (ILNS.OB); InterMune (ITMN); International Stem Cell (ISCO.OB); Javelin Pharmaceuticals (JAV); Johnson & Johnson (JNJ); Keryx Biopharmaceuticals (KERX); Kraft (KFT); MAP Pharmaceuticals (MAPP); Medco (MHS); Merck (MRK); Merit Medical (MMSI); Novartis (NVS); Novelos (NVLT.OB); Novo Nordisk (NVO); Nutrisystem (NTRI); OSI Pharmaceutical (OSIP); Orexigen (OREX); Pepsi (PEP); Pfizer (PFE); Rite Aid (RAD); Schering-Plough (SGP); Takeda (TKPHF); Teva Pharmaceuticals (TEVA); Viropro (VPRO.PK); Walgreens (WAG); Wyeth (WYE); XOMA (XOMA); ZIOPHARM (ZIOP).

In the following brief excerpt from the 70-page report, Dr. Amit Kumar, CEO of CombiMatrix Corporation, discusses the outlook for the sector and for investors.

TWST: How do you explain to the general public what CombiMatrix does?

Dr. Kumar: We make products and services that enable the analysis of genetics, and that enablement is used in a number of different fields like drug discovery, analysis of genetic factors, genes and how these biomarkers correlate with diseases. Most laypeople have heard about the sequencing of the human genome, and that basically was just the beginning of the process of understanding genetics. From a qualitative standpoint, we understand a little bit - maybe 10% - about the genes in our bodies. However, that understanding is increasing at an exponential rate. Our products help scientists understand how genes function, how they interact with each other and cause diseases, and how the genetic factors control drug responses for various types of people. Our products are used as tools, but they are also used in diagnostics, one of the more exciting areas of biotechnology from an investment perspective. Even though scientists only understand about 10% of our genes, that's enough of an understanding in many cases, especially in oncology, where our products help doctors evaluate a patient's genetics and determine how that disease is going to progress for that patient, and how best to treat that patient. So we not only provide tools for scientists doing these basic research studies to understand genes, but we also provide diagnostic services to physicians and patients who are interested in evaluating what's the best way to treat particular illnesses.

TWST: Tell us about your technology.

Dr. Kumar: We have a couple of different technologies, and we're adding additional capabilities. Basically, our semiconductor technology allows us to utilize all of the investment and engineering capabilities of the semiconductor industry to synthesize DNA molecules, biological molecules, on these chips in an array format. A DNA array is a chip that allows an individual to study a large number of genes all at one time. As opposed to studying one gene at a time in a serial fashion, an array allows one to do a parallel analysis on a large number of genetic markers. An analogy to the computer business is illustrative. In the old days, before we had microprocessors and computers, people would create a spreadsheet one box at a time. Now with a microprocessor and a computer, you can change one box and it automatically changes the other appropriate boxes in that spreadsheet. Basically, a microprocessor allows a computer to do multiple functions all in parallel. That's what a DNA array does on the biological scale - instead of studying one gene in one cell or one tissue at a time, you are able to study a large number of genes all at once. This is useful because many of the medical questions that one wants answered require an analysis of a large number of genetic markers.

TWST: Tell us about your drug development and biodefense programs. What is the status of what you're doing in those two areas?

Dr. Kumar: CombiMatrix provides the tools that enable scientists to understand genetics and then help develop drugs based on that understanding. Additionally, we focus on certain molecules through a minority-owned subsidiary that's developing a small molecule drug, addressing a number of oncologies, including leukemias as well as potentially solid tumors. That first compound is now in a Phase I clinical trial in England, and so far it looks promising. In the biodefense area, we utilize our array technologies to develop products that are of interest to our military. These are systems that enable the military to test for things like anthrax, and plague and various other things that would be of concern in a battlefield situation or in a situation where people are concerned about terrorism. We've also developed a number of tests for things like influenza. H1N1, that's the swine flu, is one of the influenzas that people are concerned about, and our technology enables us to detect H1N1 as well as more pathogenic versions, like the bird flu and things like that. These tests are being used by a number of military labs and a number of government agencies. We've run some of these tests on our military personnel soldiers who've gotten sick to evaluate what kind of illnesses they have.

TWST: What do you see for CombiMatrix over the next five years?

Dr. Kumar: I think this is a very exciting time for the company. We are engaged in a very exciting field in medicine, and many of our products not only are incredibly beneficial in today's medical environment, but also as health care reform issues are discussed, all of our products will benefit from many of the various types of proposals and suggestions that are being made. It's not clear what's going to happen at this point, but whatever happens, there will be definitely a greater emphasis on wellness, early detection and things like that. We anticipate that all of those initiatives will benefit us. Over the next five years, I think we will show successively more exciting products getting onto the market. Obviously, we expect and hope that our financial results will continue to improve and get to a point where we are a much bigger company that's very successful.

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