Blood work; Dani Bolognesi's researchers found a new way to fight AIDS. Now comes the hard part: making sure it pays off for Trimeris.

• Author: Maley, Frank
• Position: Health Care - Biography

It's showtime. Time for Dani Bolognesi to give another lesson on AIDS viruses, how they attack white blood cells and how a drug created by his company stops them from infecting healthy cells. It's the first drug to do that -- and being first is important to Bolognesi and his company -- but it's still not a cure.

Sitting at the computer in his office at Durham-based Trimeris Inc., he clicks into his e-mailbox and calls up some color diagrams. As he lectures about molecules and membranes, he reaches back with his big left hand and whacks your arm with the back of his fingers. Several times. It's nothing that will leave a bruise, but it keeps your attention from drifting.

"That's Italian," he explains later. "Some people don't react well to that." Then he laughs. "1 do it on Wall Street, too." Does it work there? "1 doubt it. They probably wonder what kind of animal this is. I'm a little weird for Wall Street anyway. I come from another planet."

Bolognesi is a scientist by training and disposition. He learned how to run a company because he found himself running a company. He claims he never would have helped start Trimeris if a venture capitalist hadn't talked him into it 10 years ago. He didn't leave his job as director of Duke University's Center for AIDS Research to become CEO and chief scientific officer until 1999.

Even now, at 62, he would just as soon be back in the lab, trying to figure out more about how AIDS viruses work. Solving problems, big and small, is what animates him. He loves a challenge, relishes competition, and if he's truly passionate about something, he doesn't let little things -- such as, say, blurry vision or lack of clothing -- get in his way.

While at Duke, he went fishing with three employees, all fellow scientists, along a drainage canal not far from his vacation home on Albemarle Sound. After they split up, he slipped on a steep bank and fell in, losing his rod and reel and his glasses in the murky water. He climbed out, shed his clothes and hung them to dry. Then he went back in the chest-deep water, feeling with his feet in the muck on the bottom for his fishing rig and his glasses. Finding both, he crawled out and, buck-naked, resumed fishing. "I wasn't going to worry about it. There's nobody there."

Hooking and landing a 5-pound bass, he proudly strolled along the bank in the buff and handed his catch to the first companion he encountered. Show it to the others, he said. Braggadocio? "It's just that getting those bass is so much fun."

The AIDS drugs that came before Trimeris' try to block replication of the virus after it enters healthy cells. Fuzeon prevents infection by blocking the fusion of virus and white blood cell. The drug's novelty and effectiveness in U.S. Food and Drug Administration tests attracted Swiss drug giant Roche as a partner to manufacture and market it.

Roche came on board just a few months after Bolognesi did. Fuzeon -- then known as T-20 -- was in late-stage testing, and it performed better than its backers had hoped. "That," Bolognesi says, "basically speaks louder than anything." The company had gone public in 1997. while he was still at Duke, raising $34.5 million. Since he has been chief executive, Trimeris has raised a total of $291.9 million in five additional stock offerings.

Much of that money is already spent. By the end of last year, the company had an accumulated deficit of $265 million -- about $76 million of it racked up last year -- and it still didn't have a product on the market. That changed in March when the FDA approved Fuzeon for use in AIDS patients who were not responding to other treatments. In May, Fuzeon was approved by European Union regulators. Now it's time for the payoff.

Under its deal with Roche, Trimeris pays half of the expenses and gets half of the profits -- once there are some -- in the United States and Canada from Fuzeon and T-1249, a follow-up compound still in testing. In the rest of the world, Roche pays expenses and Trimeris gets royalties on net sales. Roche also agreed to pay Trimeris for licensing and additional money as it hits performance milestones, as much as $88 million in all.

But question marks remain. Though Fuzeon, at its retail price of about $20,000 per patient per year, is the most expensive AIDS drug yet, manufacturing will be a bigger hurdle to profitability than for other drugs. Fuzeon is a complex molecule that requires more amino acids --36 -- than any other commercial drug in the United States, says George Abercrombie, head of Roche's North American operations. On average, it requires 10 chemical steps to manufacture a drug molecule. Fuzeon takes 106.

The average cost of sales for other drugs is about 10%, says Sharon Seiler, a biotechnology analyst at Punk, Ziegel & Co. in New York. For Fuzeon, Roche has been telling analysts it is 40% to 50%. "So the question is, 'All right, great. The drug works...