FASgen Inc. Chief Business Officer William McIntosh has been trying all year to get venture capitalists to invest in his Baltimore biotechnology company. But though FASgen has well-regarded scientists and a technology that might result in drugs to treat conditions ranging from cancer to obesity, he hasn't gotten a single financier to bite.

His experience represents a larger trend. Only 28.1 percent of the deals that regional venture-capital firms were working on in the last half of the year were with early-stage companies, according to a Mid-Atlantic Venture Association survey. That's down from 50 percent in the second quarter.

At the same time, venture investment in health-care companies has slowed. Venture investment in such companies in Maryland totaled $2.5 million in the third quarter, down from $22 million and $44.6 million in the third quarters of 2001 and 2000, respectively, according to San Francisco-based research firm VentureOne.

The slowdown isn't because of a lack of available money: Venture firms that focus on investing in health-care companies raised $4.4 billion this year, adding substantially to coffers still bulging with proceeds from the record-setting $5.3 billion they raised last year, VentureOne figures show. But most of them are shying away from young, early-stage companies such as FASgen because those companies have a higher risk of failure.

Young Maryland biotechnology companies are having a particularly tough time. Many venture firms either invest in their own back yards or pool money with an out-of-state venture firm located near the company they're backing. Because Maryland has only a handful of venture firms that invest in life sciences companies, local investments are limited. Those firms that do invest locally often require even young companies to have relatively advanced products or prospects.

Boulder Ventures General Partner Josh E. Fidler said his firm is one of them. The company, which has offices in Owings Mills, Colorado and San Francisco, plans to invest about 20 percent of the $142 million it raised last year in life sciences companies. It generally makes investments of $1 million to $4 million.

"We're definitely early-stage," Fidler said about the kinds of companies his firm invests in. But even Boulder requires companies to have either a biotech tool or service that's already bringing in revenue or one advanced enough to be tested with customers. It has invested in just one biotech company from its current fund - in Colorado.

Fidler said that "to some degree" Maryland is underserved by venture capital. "People have been crying the blues about that for awhile," he said. A study in December last year of Maryland's venture capital climate by Ernst & Young concluded the Maryland bioscience industry has a venture funding gap of $50 million to $100 million, compared with the levels of venture capital financings of biotech companies in 11 other states.

The situation is exacerbated by the fact that such investing has dropped overall. VentureOne statistics show that venture financing of health-care companies totaled just less than $4 billion through the third quarter of this year, compared with $4.3 billion at the same time last year and $7.1 billion in 2000.

In Maryland, venture investing in health-care companies totaled $76.6 million through the third quarter of this year, up from $56.77 million through last year's third quarter. But that was down significantly from the $122.67 million through the third quarter of 2000. What's more, investment dropped nearly 89 percent in the third quarter alone compared with last year, to $2.5 million from $22 million a year ago.

One reason is that the depressed stock market makes it impossible for the companies venture firms have invested in to go public. Without a key way to recoup existing investments, the financiers often are reluctant to invest in new ones while they put more money into companies they already own. Some hedge their bets by insisting any new companies in which they invest get money from other venture firms, too.

"The company could run out of money if another [venture firm] won't step up to the table," said Wei-Wu He, general partner of Emerging Technology Partners in Rockville.

Tom Salemi, editor of The Venture Capital Analyst/Health Care, said it's almost exclusively more mature companies - those with drugs in clinical trials or close to entering them - that are getting the money. Though there are fewer such deals nationally, he said, they now tend to be larger. One example: Gaithersburg-based Iomai Corp., a developer of vaccine-delivery technology, is expected to announce next month that it has closed on more than $50 million in venture capital from firms including Baltimore-based New Enterprise Associates.

M. James Barrett, a New Enterprise Associates general partner, declined to comment on any such investment. But he said he doesn't consider Iomai, which has a number of collaborations with other companies and products in clinical trials, to be early-stage.

"If a company comes to me with nothing in the clinic or nothing even [being tested] in animals, there's almost no valuation where that makes sense," Barrett said.

Iomai's upcoming deal is clearly the exception. Even some companies with products on the market aren't getting funded.

Chief Executive Officer Jonathan Cohen of 20/20 GeneSystems Inc. said his Rockville company, which already sells its protein-identification kits to laboratories, is relying on wealthy individual investors, state and federal grants, licensing fees and revenue to survive while he continues to pursue venture capital.

"Venture capital isn't going to play the role it did in the '90s," he said. "We're going to build a great company with venture capital or without it."

But Cohen is still trying. He met recently with Fidler - for the third time.

Lee F. "Frank" Kolakowski, CEO of ReceptorBase Inc., a tiny Baltimore developer of gene databases and software for drug discovery, said he's decided to concentrate on getting a few contracts before going back to venture capitalists. His experience talking with them has convinced him that they otherwise won't sign on.

Amy Chu of Cell Works Inc., the Baltimore developer of drug-delivery technology and a blood test for cancer, was optimistic as she paused for an interview on a fund-raising trip.

"Our technology is getting close to Phase I trials, and we're getting a much warmer reception than we were a year ago," said Chu, the company's vice president of strategy and business development. "I'm a little surprised by that. I was expecting the worst."

But FASgen's McIntosh, who said he has met with up to 60 venture capital firms in the past 12 months, isn't feeling the warmth. The 3-year-old company, which has five full-time employees, has kept going on a series of government grants. McIntosh so far hasn't had any luck, however, supplementing the $3 million in venture capital the company raised in 2000.

"It really is a grind out there," McIntosh said.