Other Ventures

The D. E. Shaw group’s first two technology ventures reflect its conclusion, based on a considerable amount of technical and market research, that advanced computational techniques would ultimately have a major impact on the way chemists design molecules for use in pharmaceutical products, new materials, and other applications. In 1994, the firm purchased 36 percent of Molecular Simulations Inc., which grew to become the world’s leading supplier of computational chemistry software before merging with Pharmacopeia, Inc. (Nasdaq: PCOP) in 1998.

The D. E. Shaw group later assumed a major ownership position in Schrödinger, a spinoff of the California Institute of Technology and Columbia University that has since attracted substantial funding from the federal government and a number of large pharmaceutical firms to support the commercial application of significant computational breakthroughs achieved by its founders within the fields of quantum chemistry, molecular modeling, drug design, and protein structure determination.

The D. E. Shaw group was also responsible for the conceptualization, organization, and initial financing of Juno Online Services, Inc., which grew to become one of the nation’s largest Internet access providers. Juno became a public company in May 1999, and in the third quarter of 2001 became one of the few major Internet-related companies to achieve profitability. On September 25, 2001, Juno merged with NetZero to form United Online, Inc. (Nasdaq: UNTD), creating the nation’s second-largest Internet access provider.

In 1998, the firm founded Attenuon, LLC, a San Diego-based pharmaceutical company developing cancer therapeutics that work by selectively disrupting angiogenesis (the formation of new blood vessels, which feed tumor growth) and metastasis (the spreading of tumors). Based on this approach, Attenuon seeks to develop broad-spectrum cancer drugs that have fewer side effects, are more suitable for long-term use, and work in combination with existing therapies.