Hundreds of millions of dollars are being tossed at consumer companies that are riding the human genome wave.
The investment craze is something when you consider that 20 years ago, just before the turn of the century, the world’s interest in DNA was casual at best. It was stuff people learned about in biology class.
But mass DNA awareness began to change between 2000 and 2003. That’s when researchers cracked the code and unlocked the secrets hidden in human DNA.
By 2013, scientists had identified all three billion chemical units that make up human genetics.
That opened the door to a search for the genetic roots of diseases such as cancer and diabetes. The goal is to develop powerful treatments – even cures.
“Who am I?” 21st Century Style
Mapping the genome also opened the door for new types of companies – those that offer direct to consumer genetic genealogy tests.
The tests are fairly simple in that they use DNA to tell people what continents their ancestors are from and to locate family members, including distant cousins.
The type of readout called a genotype, consists of around a million measurements of a person’s genome, performed using an inexpensive DNA chip.
By early 2018 competing companies such as 23andMe and Ancestry.com had become a hot trend.
In fact, the number of people who’ve had their DNA analyzed in order to explore their lineage more than doubled in a single year.
More than six million people bought testing kits during 2017, which pushed the historic total past 12 million.
These Companies Aren’t Shy About Asking For Your Business
The boom was caused by a price war that saw testing kits fall as low as $60, along with a slew of 2-for-1 end-of-year offers.
It was also fueled by advertising.
Ancestry.com spent $109 million on TV and other ads in the U.S. according to Kantar Media. It’s on track to spend more this year.
And that dwarfed 23andMe’s $21 million ad spend.
All told, the raw numbers suggest that Ancestry.com has tested more than seven million people, while 23andMe has tested at least five million people.
Enter The Major Players
Of course, as night follows day, you can bet all that raw data has major corporate players drooling.
GlaxoSmithKline was the first blue chip to make its move.
It’s paying 23andMe $300 million to use people’s DNA in four-year collaboration to discover possible targets and treatments for human diseases.
“The goal of the collaboration is to gather insights and discover novel drug targets driving disease progression and develop therapies,” GlaxoSmithKline said in a July 25, 208 press release.
Forbes reported that the companies’ first steps could be to explore a gene called LRRK2. It’s a gene that’s related to some cases of Parkinson’s disease.
Parkinson’s is common, occurring in about a million Americans, but estimates are that only 10,000 have Parkinson’s caused by LRRK2.
Glaxo is working on a LRRK2 drug. But to find patients to test it on requires testing 100 Parkinson’s patients to find one prospective test subject.
But 23andMe already has 250 Parkinson’s patients with the LRRK2 gene variant who have agreed to be considered for clinical trials. This could allow Glaxo to develop its drug much, much faster.
The new collaboration isn’t the first time 23andMe’s vast pool of genetic data has been mined by scientists. The San Francisco startup has already published more than 100 scientific papers based on its customers’ data, according to a July 2018 blog post by 23andMe’s co-founder and CEO, Anne Wojcicki.
Also, back in 2015, the company launched 23andMe Therapeutics, which focuses on developing novel treatments and cures based on genetic insights using DNA from people who’ve agreed to be in the research pool.
Privately held 23andMe raised $250 million from Sequoia Capital last September bring its total raise to $491 million.
The company is rumored to be valued about $1.75 billion.
IPO anyone?
