Visualization of Cancer Associated Metabolic Atypia (CAMA) in human tissue

CellStain's scientific claim will prove quite difficult for the medical community to swallow. The small company, located at the Weizmann Incubator for Technological Entrepreneurship in Nes Ziona, has managed to develop a way of coloring all types of cancerous and pre-cancerous cells. What does this mean? Dan Gelvan, who has a PhD in Business-Economics and founded the company says, "We include in the word 'cancer' a host of symptoms. Doctors know of no single disease named simply cancer - there are hundreds of different diseases, and there is no consensus on their common traits, not even at the level of cell behavior."

Then a company like CellStain appears and claims all these diseases do have something in common, and it can diagnose it. The implications of such a discovery are far reaching, foremostly in the field in which the company operates - diagnostics.

"Globes": Is it accurate?

Gelvan: There are a few question marks, but there always are in biology. 100% does not exist."

In charge of the development is Dr. Lev Goltsman, a pathologist who immigrated from Russia at the beginning of the 90s. Goltsman arrived at the method while working on the staining of cells for other purposes, during his employment at Kaplan Hospital from 1991, until the company was founded at the incubator in October 1997. Gelvan met him in 1994, when he served as a consultant in biology at the national committee for biotechnology. Alex Kocak, founder of D-Pharm (one of the most promising incubator companies) told Gelvan there was an excellent development on which, perhaps, a company could be formed. Gelvan reviewed it and was impressed.

However, another three years were to pass before CellStain was founded. "It took us a long time to trust each other. It was a suspicious relationship," says Gelvan.

Gelvan purchased the development rights from Goltsman and Kaplan Hospital, and added supplementary financing to the Chief Scientist's grant. Today, Goltsman is a regular employee at the company, while Gelvan owns most of the shares (apart from 20% belonging to the incubator, and 10% allocated to the employees, as dictated by the terms of incubator projects).

Doesn't Goltsman have additional shares?

"As an employee. Everyone is delighted with the arrangement. It's not a common occurrence at the incubators, but a good paradigm. Without the solution, this development would not have led to commercial application."

With a record like yours, why go to an incubator?

"That is the place I received the best return on my investment. When we started out in 1997, I was aware I would not be able to raise money with such a tremendous scientific claim. People reacted with 'Oh, sure'. Before entering the incubator, I met with venture capital funds. I knew it would not succeed, but from the questions they asked, I built my business plan. Some investors suggested I enter the incubator, show clinical trials and then come to them."

Gelvan says his business plan aimed at "taking off from the unattractive corner of primary applications. You should understand that the initial development was not regarded as a sexy subject at all by the doctors, or as profitable." It was in the field of General Cytology, which includes various body fluids, such as accumulate in the eyes, the stomach and urine. The next step was to enter the PAP smear field (testing for uterine cervix cancer) which has a volume of 120-140 million tests a year.

"We accomplish 90% of the procedure through staining, and 10% through computer. Our approach is that you can't make the process as completely mathematical like the competitors do."

What difficulty is attached to developing the software?

"It's not a trivial matter, but it's possible."

The company arrived at the stage of PAP testing only two weeks ago. "We reached that stage earlier than we planned," says Gelvan. According to him, it is a most vital stage since it includes both identification of pre-cancerous cells, and what hides behind the staining principle.

What hides behind the staining principle?

"It is purely an empirical finding. Dr. Goltsman is part of a generation of inventors from fifty years ago who observe and test without applying formulated theories to their tests."

But, if you discover the principle behind it, it would have implications in the field of cancer cures?

"Perhaps. Why am I cautious? From a scientific aspect, you have to be cautious. I am creating a business entity in the diagnostics field. If we find it, we will find a way to apply it - either by ourselves or through cooperation."

The next step according to Gelvan's plans is to enter the field of malignant cell tissue identification. There, in niches with negligible competition, the company will be able to determine high prices, depending on demand.

Gelvan says the company aims at becoming the standard for cell coloration. Cell coloration is done today, but it is not indicative, i.e. it does not diagnose, but serves as cell visualization for the human eye.

The company is currently at the start of clinical trials. As part of the process of winning FDA approval, it must show the method works at a high accuracy rate through large representative samples. The process is expected to be completed in the third quarter of 2001.

CellStain is now negotiating to raise $1.2 million and the company is "inclined" to go into a strategic partnership with a large company in the sector, in order to develop a joint product. "I am a great believer in strategic partnerships. In seeking FDA approval, when I arrive with a US company, not merely an Israeli nobody, it gives a different impression."

Published by Israel's Business Arena February 23, 1999