MONEY THAT GROWS ON TREES

By Dan Cray

It was your basic lab experiment, akin to those bubbling in high school chemistry labs every week. In this case, the goal was to determine whether plant samples from the Ecuadorian rain forest contained chemical properties that could be used to combat diabetes. Immerse the leaves in an alcohol extract, then a water extract, and see what happens. Ho hum.

What set this particular test apart, however, was the ensuing debate--one that scientists at Shaman Pharmaceuticals, the cutting-edge company conducting the research, will never forget. At issue was whether or not to throw a live crab into the extract, just as native healers do. "We're thinking, How important could that be, for God's sake?" says Lisa Conte, president and CEO of Shaman. "But wouldn't you know, of the three extracts, the one with the crab in it was the only one that showed activity." Turns out that a component in a crab's shell is needed to coerce the active chemical compound from the plant.

It was an important lesson in the corporate philosophy of the aptly named firm. Shaman is a South San Francisco company founded in 1989 on the concept that traditional healing methods of shamans, or indigenous medicine men, can serve as the basis for modern-day drug development.

Giant pharmaceutical firms have long prospected the rain forests, screening randomly selected plants for potential products. But under Conte's direction, Shaman became one of the first companies to rely on the ancestral wisdom of native cultures. "It was a light bulb," Conte says. "Why not leverage out this knowledge of how plants have been used for thousands of years to get something that's more likely to be effective and safe?"

Shaman is beginning to prove the point, having identified more than 3,000 possible sources of new drugs while sampling about 100 plants each year. The company's first product, Provir, is an extract of plant material used to combat acute diarrhea in Colombia, Ecuador and Peru. Currently in Phase 2 clinical trials, it could be on the market in as little as three years. A topical ointment for herpes infection and an oral antifungal agent are also in the pipeline.

Whether the company will be successful remains to be seen. A healthy stock market has given Shaman a total value of more than $100 million and a two-year cash reserve, but the company is gambling on a drug-development tactic that hinges on the relief of disease symptoms rather than on causes--a method shunned by most drug companies. Critics say it is akin to using a cork to turn off a faucet without knowing how faucet knobs work. "There is an inherent risk," admits Conte. "But that lets us discover new ways that medicines can work because we're not constrained by known mechanisms of action."

The company has 12 teams of physicians and ethnobotanists working year-round to establish relationships with native healers in 40 countries throughout Africa, Southeast Asia and South America. Skeptics, most of whom work for competing drug companies, suggest that Shaman cannot depend on primitive healers, who are seen as a cross between country doctors and clerics.

That may, however, be a matter of cultural interpretation. Shaman's ethnobotanists have found that many rainforest healers actually live with their patients to witness firsthand the full range of medical symptoms. "That," says Conte, "is much more sophisticated healing than what we do here."

--By Dan Cray