The University of Texas atAustin

Taste Chip TechnologyDescription

1) General Description of Technology

a) Executive Summaryb) Goals and Objectivesc) Brief Description of the Technologyd) Possible Application Areas

2) Description of Selected Application Areas

a) Environmental Chemistryb) Process Control Industriesc) Medical Applications

3) External Funding

4) Competing Technologies

5) Description of Inventors

6) Summary of Press Coverage

7) Selected Press Stories

1). General Description of Technology

RAPID AND EFFICIENT ANALYSIS OF MULTIPLE CHEMICAL /BIOCHEMICAL AGENTS IN SOLUTION USING SENSORARRAYS: TOWARD THE DEVELOPMENT OF AN “ELECTRONICTASTE CHIP”

Prepared by: John T. McDevitt, Department of Chemistry andBiochemistry, The University of Texas at Austin, Austin, TX 78712

The sensor technology is extremely versatile, making it suitable for themeasurement of solutions containing chemicals, biochemical reagents,electrolytes, toxins, drugs, metabolites, bacteria, blood products,beverages, food products, etc. The sensor suite exploits a large number ofchemically sensitive microsensors which serve as “artificial taste buds”.These sensor structures can be prepared a billion at a time in a beaker,allowing for the creation of the “world’s supply” of specific sensormicrospheres (i.e. for the AIDS virus). When combined with microfabricationprocedures also developed at UT, the artificial taste bud structures areincorporated into silicon chips allowing for the mass production ofnumerous units. The electronic taste chips are able to mimic many of thefeatures exhibited by the human sense of taste. That is, complex mixturesof analytes can be analyzed and intelligent decisions related to thechemical/biochemical composition of solution phase samples can be maderapidly and accurately with this novel technology. This new technology hasthe potential to create new markets and/or capture a significant fraction ofexisting markets in the following areas:

Executive Summary: A team of scientists (McDevitt, Anslyn, Neikirk,Shear, Borich) at The University of Texas at Austin has recently developedan exciting new sensor technology that allows for the simultaneousidentification of multiple analytes in solution. This high profile researchprogram has been the focus of numerous press stories (see below) andhas been selected by the Science Coalition as one of the most importantdiscoveries of the past years. The sensor technology is extremely versatile,making it suitable for the measurement of solutions containing chemicals,biochemical reagents such as electrolytes, toxins, drugs, metabolites,bacteria, blood products, beverages, and food / beverage products. Thesensor suite exploits a large number of chemically sensitive microsensorsthat serve as “artificial taste buds”. These sensor structures can beprepared a billion at a time in a beaker, allowing for the creation of the“world’s supply” of specific sensor microspheres (i.e. for the AIDS virus,etc.). When combined with microfabrication procedures also developed atUT, the artificial taste bud structures are incorporated into silicon chipsallowing for the mass production of numerous units. The electronic tastechips are able to mimic many of the features exhibited by the human senseof taste. That is, complex mixtures of analytes can be analyzed andintelligent decisions related to the chemical / biochemical composition ofsolution phase samples can be made rapidly and accurately with this noveltechnology. This new technology has the potential to create new marketsand / or capture a significant fraction of existing markets in the followingareas:

a) pharmaceutical industryb) diagnostic testingc) point of care diagnosisd) remote patient caree) beverage, wine, beer industriesf) artificial flavor, food industriesg) travel aidsh) health and safetyi) toxicology monitoringj) waste monitoringk) chemical / petrochemical processing

Goals and Objectives: The University of Texas at Austin hasprocessed 14 broad patent applications for this technology andhas established recently its first partnership with a corporatesponsor. Likewise, a new Austin-based company which willcommercialize the technology for the veterinary sciences andhuman medicine markets has now been established (see pressreleases below). From the research results acquired to date, it isclear that new opportunities exist now in areas such asenvironmental sensors, health and safety, toxicology monitoring,waste monitoring, pharmaceutical drug synthesis / discovery, food/ beverage processing and a range of other complex fluidanalyses. The University now seeks additional relationships thatwould enable the extension of this versatile technology into othercrucial technologies. The inventors / university now seek short-term sponsored research agreements that will help to transitionfrom the laboratory these discoveries into viable products instrategic areas that have the potential to have a profound influenceon our society.

Brief Description of the Technology: Scientists from The University of

Texas at Austin have developed recently a new type of sensor array that functions as

an "electronic taste chip". The device functions by using a combination of state-of-the-

art micromachining, novel photochemical sensing schemes, molecular engineering of

receptor sites, and pattern recognition protocols to detect a variety of important

biological and chemical agents. This is an exquisitely powerful sensor array that

allows for the simultaneous detection of multi-analyte systems, while also properly

“rejecting” irrelevant chemical/biochemical species in the environment.

Capabilities:

• the sensor array structures are compatible with microfabrication methods leading tosmall and inexpensive (i.e. disposable) sensor units

• sensor suites responsive to multiple analytes, antigens, toxins and bacteria can beprepared

• arrays can be calibrated readily so that new analyte systems can be recognizedwith minimal delay

• ultra-high sensitivity is provided with Charge-Couple-Device (CCD) detection oftransmission and/or fluorescence signals

• pattern recognition capabilities can be combined with the described sensor arraysto allow for the simultaneous detection of multi-analyte systems, while also properly“rejecting” irrelevant chemicals in the environment

• simple methods have been developed to create numerous (i.e. billions) of nearlyidentical artificial taste buds, tailored for specific application areas

• information regarding the chemical / biochemical composition of liquids is obtainedin “real time” with the direct digital feed of data going to a computer; this enablesboth remote patient care on the medical front as well as robotics surveillance ofpotentially toxic sites in the remediation market area

These capabilities are described more fully below.

For more information, please contact:

Licensing Contact: Ms. Renee Harvey MallettOffice of Technology Licensing and Intellectual PropertyMCC Building, Suite 1.9A, (R3500)3925 W. Braker LaneAustin, TX 78759Phone: (512) 471-2995; Fax: (512) 475 -6894Email: mallett@mail.utexas.edu

Technical Contact:Prof. John T. McDevittDepartment of Chemistry & BiochemistryThe University of Texas at AustinAustin, TX, 78712Phone: (512)471-0046; Fax: (512) 232-7052Email: mcdevitt@mail.utexas.edu

Possible Application Areas:

The development of smart sensors capable of discrimination ofdifferent analytes, toxins, and bacteria has become increasingly importantfor environmental, medicinal, clinical, military, environmental, foodprocessing / evaluation, health and safety, remote sensing, and chemicalprocessing applications. As mentioned above, the multisensor arraytechnology possess a number of unique features that appear to make it theanalytical method of choice for a wide range of application areas. Indeed,following the public announcement of the discovery of the electronic tastechip, the inventors were contacted by potential customers expressinginterest in this technology from all of the following areas:

a) human diagnostic testingb) veterinary medicinec) beverage industryd) artificial flavor / fragrance industriese) travel aidsf) health and safetyg) waste monitoringh) chemical / petrochemical processingi) scientific instrumentation (i.e. HPLC detectors)j) environmental chemistry

A short overview of some of these areas is provided below.

2) Description of Selected Application Areas

Medical Applications: The described multi-analyte sensor arraytechnology holds considerable promise for the evolving medical field. As thehealthcare system is molded by new cost cutting measures, the industry issimultaneously driven by the advancement and emergence of theexpanding field of biotechnology. With these two forces in play, it isapparent that healthcare technology must not only become moreadvanced, but it must also strive to become more efficient/cost effective.

Today, a large majority of healthcare dollars are spent on laboratorydiagnostic tests and on the acquisition of the instruments necessary forthese tests. One of the most common laboratory tests involves the analysisand quantification of blood electrolytes. This process, although routine,requires many costly steps involving drawing of blood, sample packaging

for transportation to laboratory facilities, analysis and ultimately disposal.On average, 85-95% of hospital patients undergo such routine testing on adaily basis. Even these simple tests can cost from $40-150 dollars persample, depending upon the site at which it is evaluated. The describedmulti-analyte sensor array technology, however, when applied in a similarcapacity, is expected to be far superior to current methods in that the newmethodology can bypass the usual laborious laboratory analysis.Moreover, the multi-analye sensors described here possess the advantageof real-time analysis, enabling on site functional evaluation. Further, thenew capabilities afforded with the sensor chips, in turn, diminish drasticallythe sample packaging and handling costs. Finally, the reduced samplevolume needed for the micro-chip array-based electronic taste chiptechnology will translate into significantly smaller amounts of medical waste.

A particularly attractive feature of this technology is that it will allow anurse to monitor a patient’s blood electrolytes without having to draw bloodwith a syringe and without utilizing a traditional hospital laboratory (i.e. aprocedure similar to current blood glucose analysis for diabetics). The newtechnology would also eliminate costly repeat hospital visits by patients withchronic disease who require weekly blood monitoring, as they would beable to use a portable device in their home. Computer interfacing of thetechnology (already demonstrated by the UT scientists in a prototype)would allow the remote transfer of data from a patient’s residence to thedoctor’s office/hospital via modem.

Although blood electrolyte analysis with the sensor suite by itself isrevolutionary, this type of analysis represents only one of the possibleapplications for the sensor technology. Indeed, many more specificdiagnostic tests involving more detailed blood analysis could also beassayed concomitantly, due to the multi-analyte sensor array capability.Like the evolution of technology made possible by the transistor, the powerof medical analysis methods is likely to be increase significantly with theadvent of the electronic taste chip technology.

The utility of this technology is not limited to routine blood tests.Indeed, several other currently expensive testing procedures could berendered obsolete by this innovation. For example, in the evaluation of toxicor septic patients, diagnosis and rapid treatment are paramount as theseconditions are generally life or death situations. Evaluation of such patientsgenerally consists of drawing several samples of blood in various sterilemediums and either culturing these specimens for bacterial or viral growthor screening them for multiple known toxins. Unfortunately, the associatedlaboratory results are obtained too late for meaningful clinical decision, dueto the lag time associated with the current testing modes. These patientsare generally treated broadly and intensely with multiple antidotes and

cutting-edge antibiotics, costing thousands of dollars per dose. This“generic” treatment may continue for several days until the results of thecultures or toxin screens are known. Real-time analysis and screening ofsuch patients with this sensor technology would provide the physician withan accurate and timely diagnosis, allowing a specific treatment to beadministered. Moreover, the emergence of antibiotic resistance, athreatening healthcare dilemma, due to such “generic” treatments woulddrastically decrease. This is particularly important as most county hospitalbudgets spend approximately 50% of their budget on emergencydepartment patient care.

Another avenue easily traversed by this technology involves antibodyscreening for multiple genetic and communicable diseases. Although thiskind of testing is not as common as those previously mentioned, it is farmost expensive. Due to the relative decreased frequency of testing andhigh cost of equipment involved, this evaluation is generally done byregional laboratories and often involves shipment to out-of-statelaboratories. Delays of weeks, and subsequently large expenses are oftenassociated with such tests. Multi-analyte sensor technology, applied in thisarea, would not only provide rapid on-site analysis, but would allow severalassays to run simultaneously using a single specimen. With multi-analytesensor array technology, screening of this type could be accomplished withthe same ease of routine blood chemistry evaluation. Physicians in privatepractice facilities, previously unable to provide such intricate testing, wouldconsequently have the same medical diagnostic capabilities as largedeveloped medical centers and laboratories.

The new technology represents to the medical field not only aversatile and adaptable diagnostic medium, but also a definitive method toprovide precision diagnostic capabilities in a compact and extremely costeffective form. The technology should be attractive to both large medicalfacilities as well as to rural single physician practices. Furthermore, theease of production and low production cost lends itself to disposabilitywhich is essential with strict guidelines governing medical testing.

Environmental Chemistry: The multi-sensor array technology iscapable of providing digital information regarding the classes ofcompounds and the amounts of these same species in a broad range offluids. The rapid rate through with which complex fluids can be analyzed inthis context makes this technology suitable for a wide range of importantenvironmental applications. Possibilities here include the analysis oforganic, inorganic and radioactive pollutants in water; determination ofharmful substances, including their metabolic breakdown products; theevaluation of metabolic breakdown patterns and other chemical

degradation patterns in the environment and in biological samples.Furthermore, the technology may be exploited to gain informationregarding the fate of pesticides in the environment as well as thedestination of oil, polycyclic aromatic hydrocarbons (PAHs), volatile organiccarbons (VOCs) and organohalogen compounds such as PCBs, dioxin,chlorinated pesticides, and volatile organohalogens. Continuous monitoringof the local environment using the sensor arrays with the low power andcompact units makes the technology suitable for wide spread use in theareas described above.

Process Analysis: A large percentage of consumer products usedfor modern application are composed of complex chemical and biochemicalmixtures. During the manufacturing of these products, it is necessary tomonitor product quality from batch to batch. The strict governmentregulations for food and drug industries places a burden on the commercialsector for the monitoring of the purity of the final products. Even forestablished products where processing methods are well defined, it isnecessary to evaluate carefully the product quality to insure the individualbatches meet government standards. Often in these cases, a new batch ofthe product is only started following the taking of a sample from the lastbatch. These specimens are then sent off to a remote laboratory. In themean time, the completed product is placed in quarantine until confirmationof the product purity is obtained from the certified laboratory days later. Thepresence of small amounts of soap reside or alternative undesirableproducts from an earlier batch forces the manufacturer to discard, at agreat expense, the impure batch. While it is likely that some time will berequired for the government to accept the validity of the electronic tastechip for such analyses, in the short term the sensor array should serve asan in-house “intelligence gathering device”, suitable for a large number ofprocessing industries. The described technology would appear to be well-suited for the near term commercialization in this area. The fact that thenew technology could speed the time to market for products of high marketvalue means that the upside potential in this area is large.

In the food/beverage and pharmaceutical industries, there isconcerted effort to develop new products. Upon identification of promisingnew products, these industries establish new pilot plants to begin thetransition from the laboratory discovery to the commercial productproduction. It is at this evolutionary stage that industries are most receptiveto the adoption of new monitoring technology. It is also at this time that newprocess monitoring equipment is most needed. The placement of theportable electronic taste chip modules into the processing stream wouldallow for the plant engineer to make intelligent decisions regarding theprocess control variables (i.e. reaction time, processing temperatures,catalyst/reagent concentrations, etc.). At present, samples from processingplants are sent either to an on-site analytical laboratory, or worse yet, to acommercial facility. In either case, undesirable delays ensue leading to lostproduct and more expensive processing costs. It is expected that once theprocessing engineers become acquainted with the technology that thesensor technology will be moved onto the full scale processing plants. Forthe latter case, a large number of sensor chips will be consumed (i.e. razorblade model).

3) External Funding

Over six million dollars in Federal funding has been secured by thescientists at The University of Texas at Austin to support the basic scientificissues related to the electronic taste chip technology. In addition, two worldclass centers have been established in the last year at UT for the furtherdevelopment of this area. A list of the current grants that support the area isprovided below.

1. National Institute of Health. “The Development of an ElectronicTongue.” $783,008; 4/01/98 to 3/31/01. 1R01GM57306-01

2. Army Research Office, MURI. "Texas Consortium for theDevelopment of Biological Sensors", $2,999,000. 05/01/99-04/30/02.DAAD19-99-1-0207

3. Beckman Foundation Technologies Initiative. “Center for the Designand Fabrication of Sensor Arrays.” $2,500,000, 7/99 - 6/04.

4) Competing Technologies

Electronic Noses: As an example of the success expected fromarray based sensors, we first outline how the sense of smell has beenmimicked allowing for the identification and quantification of complexmixtures of vapors. Array based sensors displaying the capacity to senseand identify complex vapors have been demonstrated recently using anumber of distinct transduction schemes. All these sensors display thecapacity to identify and discriminate between a variety of organic vapors byvirtue of small site-to-site differences in response characteristics. Patternrecognition of the overall finger print response for the array serves as thebasis for an olfaction-like detection of the analyte species. Limited chemicaldiversity and the lack of understanding of the molecular features of suchsystems makes their expansion into more complex analyses unlikely.Importantly, although the individual sensor elements respond only in aslightly different manner than do the neighboring sites, the selectivity anddiscrimination capabilities are brought out from a comparison of the“fingerprint” signal of the entire array. Pattern recognition algorithms areused for the identification of the analytes of interest. What makes thesystem particularly powerful is the ability to “teach” the array to respond tonew stimuli. For this purpose, the fingerprint signal for known and/orunknown analytes is recorded into a database for future use in theidentification of the same or similar species. This notion of a pattern is of

paramount importance for the electronic nose, and is a key feature for oursensor arrays.

Other Polymer Supported Chemical / Biochemical Sensors:Historically, one of the most commonly employed sensing techniques hasexploited colloidal polymer microspheres for latex agglutination tests(LATs) in clinical analyses. Commercially available LATs for more than 60analytes are used routinely for the detection of infectious disease, illegaldrugs, and early pregnancy tests. The vast majority of these types ofsensors operate on the principle of agglutination of latex particles (polymermicrospheres) which occurs when the antibody-derivatized microspheresbecome effectively “cross-linked” by a foreign antigen resulting in theattachment to, or the inability to pass through a filter. The dye-dopedmicrospheres are then detected colorimetrically upon removal of theantigen carrying solution. However, LATs lack the ability to be utilized formultiple, real time analyte detection schemes as the nature of the responseintrinsically depends on a cooperative effect of the entire collection ofmicrospheres.

New advances in localized analyte recognition have been developedby Walt and coworkers (Dickinson, T. A.; Walt, D. R. Analytical Chemistry1997, 69, 3413-3418). This group has covalently attached polymeric“cones”, which are grown via photopolymerization, onto the distal face offiber optic bundles. These sensor probes are designed with the goal ofobtaining unique, continuous, and reproducible responses from small-localized regions of dye-doped polymer. Here, the polymer serves as asolid support for “indicator” molecules that provide information about testsolutions through changes in their optical properties. These polymer-supported sensors have been used for the detection of analytes such aspH, metals, and specific biological entities.

While the developments in this area are impressive, the practicalmethods for manufacturing large numbers of reproducible sensors haveyet to be developed. The UT technology described here possesses anumber of strategically important advantages related to manufacturing,sensor reproducibility, and enhanced sensitivity. Many of these advantagesare brought about using the highly reproducible micromachining methods.

DNA on a Chip Technology: Similar to the electronic nose, arraysensors that have shown great analytical promise are those based on the"DNA on a chip" technology. These devices possess a high density of DNAhybridization sites that are affixed in a two-dimensional pattern on a planarsubstrate. To generate nucleotide sequence information, a pattern iscreated from unknown DNA fragments binding to various hybridizationsites. Both radiochemical and optical methods have provided excellent

detection limits for analysis of limited quantities of DNA. (Stimpson, D. I.;Hoijer, J. V.; Hsieh, W.; Jou, C.; Gardon, J.; Theriault, T.; Gamble, R.;Baldeschwieler, J.D. Proc. Natl. Acad. Sci. USA 1995, 92, 6379). Althoughquite promising for the detection of DNA fragments, these arrays are limitedto nucleotide sensing. However, many of the target molecules of interest tomedical, environmental, food/beverage industries do not possess DNAcomponents. Thus, the need for a flexible, non-DNA based sensor is acute.Moreover, while a number of prototype DNA chips containing up to a fewthousand different nucleic acid probes have been described, the existingtechnologies are not scaleable. As a result DNA chips are prohibitivelyexpensive. So far, the production of DNA chips and sensor arrays has nottaken advantage of state-of-the-art microfabrication processes and otheradvances in the area of Material Sciences.

5) Description of Inventors

Dr. John T. McDevitt received his B.S. degree in Chemistry in 1982from California Polytechnic State University, San Luis Obispo. There he wasdistinguished with the Chemistry Department Research Award. He obtainedhis Ph.D. degree in 1987 in the area of physical chemistry from StanfordUniversity where he was further honored with a prestigious GraceFellowship. He then completed postdoctoral research at the University ofNorth Carolina at Chapel Hill where he became proficient withelectroanalytical techniques and molecule-based devices. In September of1989, he accepted a position as Assistant Professor of Chemistry at TheUniversity of Texas at Austin where he was recently promoted to the level ofAssociate Professor. In 1990 he received a Presidential Young InvestigatorAward from the National Science Foundation and in 1991 the ExxonEducation Foundation Award. Dr. McDevitt is an expert in materialschemistry, optical measurements, self-assembled monolayers, andelectrochemical investigations. His broad knowledge of chemistry, physicsand engineering disciplines will serve as a useful link between the variousresearchers involved in the described project.

Dr. Eric V. Anslyn received his B.S. in Chemistry in 1983 fromCalifornia State University Northridge. He obtained his Ph.D. from theCalifornia Institute of Technology in 1987. He then moved to ColumbiaUniversity to complete NSF funded post-doctoral research in a morebiological area. In the fall of 1989, he moved to The University of Texas atAustin as an Assistant Professor, and in 1995 he was promoted toAssociate Professor. He received the Presidential Young InvestigatorAward, a Dreyfus-Teacher Scholar Award, a Sloan Fellowship, and wasnamed a Searle Scholar. His independent research has focused upon thedesign and synthesis of molecules that perform functions and tasks.

Molecular recognition and enzyme mimicry are the focal points of the work.Dr. Anslyn is an expert in thermodynamics, kinetics, organic synthesis,library methods, and molecular design. His expertise will be used to formthe chemical entities that perform the complexation and fluorescencesignaling.

Dr. Dean P. Neikirk is currently a Professor of Electrical andComputer Engineering and holder of the Cullen Trust for Higher EducationProfessorship in Engineering at The University of Texas at Austin. Hedeveloped the first monolithic, high resolution far infrared imaging detectorarray, and received the 1984 Marconi International Fellowship YoungScientist Award for his contributions to the development of millimeter-waveintegrated circuits. He received an NSF Presidential Young InvestigatorAward in 1986 for the application of integrated circuit fabrication techniquesto new electromagnetic structures. He is presently supervising a number ofM.S. and Ph.D. students on projects involving integrated circuit processing,high frequency properties of transmission lines, semiconductor devices,and micro-machined sensors and actuators. Dr. Neikirk has over 150publications in refereed journals and conference proceedings. Hisexpertise will be exploited to fabricate the array structures, to interface theelectronics as well as to develop the appropriate signal processingprotocols.

Dr. Jason B. Shear received his B.S. in Chemistry at the Universityof Texas in 1989, and obtained his Ph.D. in Chemistry from StanfordUniversity in 1994. His predoctoral studies at Stanford were supported by aHoward Hughes Fellowship, and concentrated on development of newspectroscopic techniques for analyzing neurotransmitters. Afterward, hemoved to the Applied Physics Department at Cornell University as an NSFpostdoctoral fellow, where he designed chemical and biologicalapplications for multiphoton-excited fluorescence and photochemistry. Hisresearch at Cornell led to the development of new analysis approaches forinvestigating neurotransmitter secretion from living cells. In the Summer of1996, Dr. Shear returned to the University of Texas as a tenure-trackassistant professor. He has recently been named an Office of NavalResearch Young Investigator to support his research into development ofoptical biosensors for analyzing trace levels of neurotoxins. His knowledgeof ligand–receptor interactions, ultrasensitive optical measurementapproaches, and extensive background in neurochemistry will be tapped tooptimize sensor detection limits and temporal resolution, and will provideexpertise in the possible handling and measurement of neuroactive ligands.

6) Summary of Press Coverage

The development of the "electronic taste chip" has been recognizedby the Science Coalition as one of the best scientific advances of 1998. Thesame work received widespread publicity in the scientific and in the popularmedia. A few representative examples include the highlighting of the workPopular Mechanics and Scientific American, two of the world's most readpopular science publications. The University of Texas at Austin alsoreceived positive coverage for this discovery in an ABC News segment withPeter Jennings, CNN, the BBC, as well as many radio programs andAustin's local TV networks. A partial summary of the press coverage of thistechnology follows.

ABC Nightly News with Peter JenningsCNNBBCChemical and Engineering NewsNew York TimesLA TimesPopular Mechanics cover storyScientific AmericanThe New ScientistGerman National NewspaperGerman National RadioThe Washington PostEE TimesWinnipeg Free PressTexas A&M New WavesFort Worth Star TelegramTulsa WorldAustin American StatesmanDaily TexanOn CampusThe Texas AlcaldeThe HinduU-Wire TodaySDI Instrument Business OutlookXinhua News AgencyEmerging Food R&D ReportFood Ingredient NewsAppliance ManufacturerThe New Straits TimesBusiness FirstJOM

Pittsburgh Post-GazetteThe Weekly ReaderScience ScopeU-Wire TodayXinhua NewswireEmerging Food R& D ReportResource

7) Selected Press Stories

Amanda Bronstad, "Biotech firm to hatch here," Austin BusinessJournal, March 27, 2000

Biotech firm to hatch hereAmanda Bronstad Austin Business Journal

A Florida incubator firm whose majority owner is a TL Ventures investoris launching a medical diagnostic in Austin with an initial investment of about $5million in convertible debt.

Executives at the XL Vision Inc. incubator envision the new company,tentatively called LabVision, could reach a $ billion market capitalization andemploy up to 200 people. XL Vision plans to pump $20 million in equity intoLabVision, with an eye toward taking the startup public.

Sebastian, Fla.-based XL Vision, which bills itself as an "incuvator," isteaming up with chemistry professors at University of Texas to createLabVision. The new company, set to open within a month, plans to lease 12,000square feet at the Monterrey Oaks office park in South Austin and move in bymid-June, says Mike Otworth, interim CEO of LabVision.

Privately owned XL Vision, which has launched four other companies inthree cities outside Florida, will provide capital as well as human resources,marketing and other services for LabVision, Otworth says. This will be Vision'sfirst company in Austin.

"A lot of incubators don't go to the degree we do," Otworth says. "Someprovide you with office space and combine you with other people who aredeveloping other technologies and companies. We have people here who haveexperienced development strategies for a startup."

Otworth says he expects the Austin company to employ 15 people by thissummer, between 25 and 40 in its first months and up to 200 within two years.John McDevitt, a UT chemistry professor leading the university's side of thecompany's development, couldn't be reached for comment. XL Vision expects

LabVision, which will adopt a new name in a month, to go public within two orthree years, Otworth says.

Two of XL Vision's startups already have gone public: eMerge Interactive Inc., aSebastian, Fla.-based online marketplace for the beef production industry, andChromaVision Medical Systems Inc., a San Juan Capistrano, Calif.-basedmanufacturer of imaging systems to diagnose and treat cellular diseases.

Otworth was mum about the particulars of LabVision's technology, sayingonly that it will be used for "medical diagnostics for human and veterinaryscience applications." But he says XL Vision's long-term goal is to take all itsstartups public, including LabVision.

"When we look at business opportunities, we look at things with bigmarket opportunities," he says. "We're not interested in incremental changes --we try to bring revolutionary changes to the market."

Safeguard Scientifics Inc., which invests in more than 200 companiesnationwide, owns 55 percent of XL Vision, says Richard Jacobs, first vicepresident in research at Philadelphia-based Janney Montgomery Scott LLC.Wayne, Pa.-based Safeguard posted revenue of $2.33 billion for the ninemonths ended Sept. 30.

Safeguard's investments in companies with an Austin presence include TLVentures, which is based at Safeguard's campus, and New York-basedTechSpace LLC, which is seeking to incubate 50 high tech startups with a newcenter here.

UT takes equity in tech firm, May 19, 2000, Dallas Morning News

The University of Texas at Austin will accept equity in a Florida start-up, ratherthan royalty payments, in exchange for access to technology developed by theschool's researchers.

At a time when investors are increasingly interested in biotechnologycompanies, equity ownership in Labnetics Inc. offers the university potentiallgreater rewards than royalty payments.

Although other universities have made equity deals, the agreement marks thefirst time that UT has agreed to be compensated solely through stock for ittechnology, said Renee Mallett, associate director of technology licensing forthe school.

Sebastian, Fla.-based Labnetics declined to reveal specific terms of the deal,but the company said the agreement stipulates that the university's ownershipcan't be diluted to less than 5 percent by additional investors.

Taking stakes in start-ups can be risky. "Equity can be fantasy money," saidKatharine Ku, director of the Office of Technology Licensing at StanfordUniversity in Palo Alto, Calif. "You can't run an office on it. We couldn't live onjust equity deals."

Stanford, in the heart of Silicon Valley, held equity in 53 companies as ofDecember, according to the university's licensing report. The school took in$40.1 million in royalty revenue in its last fiscal year from 339 differenttechnologies.

Labnetics seeks to develop medical diagnostic technology based on small,disposable computer chips. According to the company, the chip can test for amany as 100 different conditions with a single sample of blood.

The technology can be used for animals and humans. Labnetics intends torelease its technology first to the veterinary market, where regulatory hurdlesare lower, said Michael Otworth, interim chief executive at the company.

UT-Austin was interested in the equity position in part because it has beenbuilding a strong relationship with the company, Ms. Mallett said.

Labnetics has said it intends to keep the lion's share of its busines in the Austinarea, offering a potential boost to the region's nascent biotechnology industry,she said.

"They like our inventors, and we like them liking our inventors," Ms. Mallett said."And they like to keep us involved."

Indeed, the university will have a formal oversight role at the company. As partof the arrangement, the university will take a board seat at Labnetics, Mr.Otworth said.

Labnetics is being formed at XL Vision Inc., a business incubator in Floridawhose shareholders include Safeguard Scientifics Inc., a technologyinvestment company, and TL Ventures, a venture-capital firm.

As part of the agreement, XL Vision has committed $1.3 million in a sponsoredresearch agreement with UT-Austin.

UT's Office of Technology Licensing and Intellectual Property seeks to protect,market and license rights to the work of the faculty and staff of the school.License agreements may be based solely on royalties, equity or somecombination of the two.

The licensing deals are intended to sponsor continued research at theuniversity, and to serve as an incentive to inventors who share in the income. Aspecial committee reviews potential conflicts of interest for the universityresearchers.

UT tongue may hook up with electronic nose -- July 26, 1998

UT tongue may hook up with electronic noseOn the Web: University of Texas at AustinBy Dick StanleyAmerican-Statesman Staff

Published: July 26, 1998

Remember the New Coke debacle? The hired tasters loved it. But few othersdid, and the old formula was hastily resurrected as Classic Coke. With the newelectronic tongue, under development by University of Texas chemists and electricalengineers, New Coke might have been licked much sooner.

The device, consisting of hundreds of chemical microsensors on a silicon waferto mimic the taste buds of a human tongue, has a multitude of potential uses. Amongthem is the rapid testing of new food and drink products for comparison with acomputer library of tastes that people are known to like.

But the UT tongue, which is smaller than Abraham Lincoln on the head of apenny, could boldly go where few tongues have gone before. "If you could tasteblood," said Eric Anslyn, a UT chemist and tongue researcher, "you could taste forcholesterol."

Or cocaine in urine, toxins or microbes in water, or familiar and unfamiliarchemicals in any liquid: palatable, icky or plain poisonous. The National Institutes ofHealth, for example, recently gave the UT researchers $600,000 to develop a versionof the tongue to try to replace the multiple standard medical tests done on blood andurine with one rapid test. The UT research, which was reported in a recent edition ofthe Journal of the American Chemical Society, began in 1996 when electrical andcomputer engineer Dean Neikirk and chemists John McDevitt and Jason Shear begankicking the idea around. They'd read of research in Britain and Sweden to try to makebiosensors that could mimic the sophistication of a nose. Dog noses, for example, areso sensitive they can sniff out particular molecules in vapor concentrations as low as afew thousand parts per billion of air. Technologies for the detection and analysis ofvapor and liquid molecules exist, but they tend to be bulky, slow and complicated, andable to assay only one or a few chemicals at a time. To fully mimic a nose or a tongue,a biosensor should be able to rapidly assay many samples at once.

"We put a nose together first," Neikirk said, "to sniff out iodine." "But manychemicals cannot be (evaporated)," McDevitt said. "So you need a tongue." "That'swhen they brought me in," Anslyn said. Anslyn had some polymer microbeads, eachone smaller than the width of a hair, which biochemists use to synthesize DNA and itsproteins. The researchers figured the beads would work well in an electronic tongue.

Mimicking the surface of the human tongue, with its thousands of tiny cavitiescontaining various chemical receptors for the four main classes of taste buds (sweet,sour, salt and bitter), the UT researchers micromachined inverted pyramids into siliconwafers and dropped a single polymer bead into each one. Each bead was equippedwith a sensor for a particular class of chemicals.

Then they attached the sensors, which respond to chemicals by changing color,to a camera-on-a-chip to analyze the color changes at 30 frames a second and reportthem to a computer. They're now up to hundreds of bead sensors on a single wafer,with the potential to rapidly analyze millions of chemical combinations. But they're notsatisfied with just a tongue on silicon.

"We're working on a process to make them cheaply and quickly," Neikirk said."They could come on a roll of tape, for example, to be used once and thrown away." Innature, of course, the sensation of taste is related to the sense of smell. Noses andtongues work together. "There's probably a good deal of synergy between the two,"John Warburton, director of a British company that makes electronic noses, told NewScientist magazine last week in an article on the UT tongue. Indeed, McDevitt said theelectronic nose and tongue might collaborate, say, in the brewing of beer: The nosecould sense the vapors while the tongue monitored the liquid in the vat. While the UTresearchers prepare to file for patents on their electronic tongue, many food and drinkprocessing companies are already calling. "About one a day," McDevitt said.

TECHNICAL INSIGHTS ALERTPhone: 201-568-4744

SENSOR TECHNOLOGY ALERTJULY 24, 1998

SENSOR ARRAY MIMICS TASTE BUDS OF HUMAN TONGUE

When drinking or eating, the human tongue differentiates among substancesthrough four types of tastes: sweet, sour, salty, and bitter. Four types of taste buds onthe tongue identify each one of these tastes. The tongue can distinguish differenttastes, but it can't tell you the chemical makeup of the substance.

Researchers at the University of Texas at Austin have adapted the design of thetongue to create an electronic tongue. As a result, their sensor system not onlydistinguishes between different substances in a solution as the human tongue does,but also tells you the chemical composition of the solution.

The researchers' electronic tongue resembles the human tongue, which ismade up of cavities that hold chemical receptors called taste buds. The researchers'electronic tongue consists of a Si/SiN wafer that has micromachined wells on itssurface. Inside each of these wells are minute beads of polyethylene glycol andpolystyrene that act as chemical receptors just like the taste buds of the humantongue.

The polymer beads are designed with receptor sites to detect the substancebeing targeted and also contain indicator molecules that change color or fluorescencewhen specific substances bind to the receptors. The color changes are then detectedby placing the wafer in front of a light source and then collecting the light as it passesthrough the transparent wells. A charge-coupled device (CCD), essentially a videocamera, collects the light and measures red, green, and blue wavelengths.

To test the concept, the researchers fabricated an array containing four differenttypes of responsive beads: a pH detector, a calcium and pH detector, a cerium,calcium, and pH detector, and a simple sugar detector. This array was placed inside acapillary cell and the solution to be tested poured over it. The polymer beads withinthe wells responded in less than a minute to the analytes being tested. Finally,examining the RGB color patterns of the CCD camera performs the analysis of theanalytes.

Future applications of the sensor array could be the analysis of food products,beverages, chemical processing streams, biomedical fluids, and other complexmixtures. The researchers are conducting further development to create sensors fordetecting antigens, toxins, and bacteria.

They are also working on the problem of getting the sensor array's responsesintegrated into a computational network to recognize RGB color patterns for a varietyof solutions.

Details: John T. McDevitt, Associate Professor, Dept. of Chemistry and Biochemistry,University of Texas at Austin, Austin, TX 78712-1062.Phone: 512-471-0046. Fax: 512-471-8698. Internet:mcdevitt@mail.utexas.edu .

Copyright 1998, John Wiley & Sons, Inc., New York, NY 10158

For more information, please contact :

Licensing Contact: Ms. Renee Harvey MallettOffice of Technology Licensing and Intellectual PropertyMCC Building, Suite 1.9A, (R3500)3925 W. Braker LaneAustin, TX 78759Phone: (512) 471-2995; Fax: (512) 475-6894Email: mallett@mail.utexas.edu

Technical Contact:Prof. John T. McDevittDepartment of Chemistry & BiochemistryThe University of Texas at AustinAustin, TX, 78712Phone: (512) 471-0046; Fax: (512) 232-7052Email: mcdevitt@mail.utexas.edu