Low prices to encourage consumers to order its WGS service is one way Veritas co-founder and genetics pioneer George Church hopes to sequence 150,000 genomes by 2021
By announcing an annotated whole-genome sequencing (WGS) service to consumers for just $599, Veritas Genetics is establishing a new price benchmark for medical laboratories and gene testing companies. Prior to this announcement in July, Veritas priced its standard myGenome service at $999.
“There is no more comprehensive genetic test than your whole genome,” Rodrigo Martinez, Veritas’ Chief Marketing and Design Officer, told CNBC. “So, this is a clear signal that the whole genome is basically going to replace all other genetic tests. And this [price drop] gets it closer and closer and closer.”
Pathologists and clinical laboratory managers will want to watch to see if Veritas’ low-priced, $599 whole-genome sequencing becomes a pricing standard for the genetic testing industry. Meanwhile, the new price includes not only the sequencing, but also an expert analysis of test results that includes information on more than 200 conditions, Veritas says.
“The focus in our industry is shifting from the cost of sequencing genomes to interpretation capabilities and that’s where our secret sauce is,” said Veritas CEO Mirza Cifric in a news release. “We’ve built and deployed a world class platform to deliver clinically-actionable insights at scale.” The company also says it “achieved this milestone primarily by deploying internally-developed machine learning and AI [artificial intelligence] tools as well as external tools—including Google’s DeepVariant—and by improving its in-house lab operations.”
The myGenome service offers 30x WGS, which Veritas touts in company documentation as the “gold standard” for sequencing, compared to the less-precise 0.4x WGS.
The myGenome service is available only in the United States.
Will Whole-Genome Sequencing Replace Other Genetic Tests?
Veritas was co-founded by George Church, PhD, a pioneer of personal genomics through his involvement with the Harvard Personal Genome Project at Harvard Medical School. In a press release announcing the launch of myGenome in 2016, Veritas described its system as “the world’s first whole genome for less than $1,000, including interpretation and genetic counseling.”
Church predicts that WGS will someday replace other genetic tests, such as the genotyping used by personal genomics and biotechnology company 23andMe.
“Companies like 23andMe that are based on genotyping technology basically opened the market over the last decade,” Martinez explained in an interview with WTF Health. “They’ve done an incredible job of getting awareness in the general population.”
However, he goes on to say, “In genotyping technology, you
are looking at very specific points of the genome, less than half of one
percent, a very small amount.”
Martinez says Veritas is sequencing all 6.4 billion letters
of the genome. And, with the new price point, “we’re closer to realizing that
seismic shift,” he said in the news release.
“This is the inflection point,” Martinez told CNBC.
“This is the point where the curve turns upward. You reach a critical mass when
you are able to provide a product that gives value at a specific price point.
This is the beginning of that. That’s why it’s seismic.”
Rodrigo Martinez (above), Veritas’ Chief Marketing and Design Officer, told CNBC, “The only way we’re going to be able to truly extract the value of the genome for a healthier society is going to be analyzing millions of genomes that have been sequenced. And the only way we can get there is by reducing the price so that more consumers can sequence their genome.” Photo copyright: Twitter.)
Payment Models Not Yet Established by Government, Private
Payers
However, tying WGS into personalized medicine that leads to actionable diagnoses may not be easy. Robin Bennett, PhD (hon.), a board certified senior genetic counselor and Professor of Medicine and Medical Genetics at UW School of Medicine, told CNBC, “[Healthcare] may be moving in that direction, but the payment for testing and for services, it hasn’t moved in the preventive direction. So, unless the healthcare system changes, these tests may not be as useful because … the healthcare system hasn’t caught up to say, ‘Yes, we support payment for this.’”
“Insurers are looking for things where, if you get the
information, there’s something you can do with it and that both the provider
and the patient are willing and able to use that information to do things that
improve their health,” Phillips told CNBC. “Insurers are very interested
in using genetic testing for prevention, but we need to . . . demonstrate that
the information will be used and that it’s a good trade-off between the
benefits and the costs.”
Sequencing for Free If You Share Your Data
Church may have an answer for that as well—get biopharmaceutical companies to foot the bill. Though Veritas’ new price for their myGenome service is significantly lower than before, it’s not free. That’s what Nebula Genomics, a start-up genetics company in Massachusetts co-founded by Church, offers people willing to share the data derived from their sequencing. To help biomedical researchers gather data for their studies, Nebula provides free or partially-paid-for whole-genome sequencing to qualified candidates.
“Nebula will enable individuals to get sequenced at much
lower cost through sequencing subsidies paid by the biopharma industry,” Church
told BioSpace.
“We need to bring the costs of personal genome sequencing close to zero to
achieve mass adoption.”
So, will lower-priced whole-genome sequencing catch on?
Perhaps. It’s certainly popular with everyday people who want to learn their
ancestry or predisposition to certain diseases. How it will ultimately affect
clinical laboratories and pathologists remains to be seen, but one thing is
certain—WGS is here to stay.
Following the raid, the company’s co-founders resigned
from the board of directors
Microbiome testing company, uBiome, a biotechnology developer that offers at-home direct-to-consumer (DTC) test kits to health-conscious individuals who wish to learn more about the bacteria in their gut, or who want to have their microbiome genetically sequenced, has recently come under investigation by insurance companies and state regulators that are looking into the company’s business practices.
CNBC
reported that the Federal Bureau of
Investigation (FBI) raided the company’s San Francisco headquarters in
April following allegations of insurance fraud and questionable billing
practices. The alleged offenses, according to CNBC, included claims that
uBiome routinely billed patients for tests multiple times without consent.
Becker’s
Hospital Review wrote that, “Billing documents obtained by The Wall Street
Journal and described in a June 24 report further illustrate uBiome’s
allegedly improper billing and prescribing practices. For example, the
documents reportedly show that the startup would bill insurers for a lab test
of 12 to 25 gastrointestinal pathogens, despite the fact that its tests only
included information for about five pathogens.”
Company Insider Allegations Trigger FBI Raid
In its article, CNBC stated that “company insiders”
alleged it was “common practice” for uBiome to bill patients’ insurance
companies multiple times for the same test.
“The company also pressured its doctors to approve tests
with minimal oversight, according to insiders and internal documents seen by CNBC.
The practices were in service of an aggressive growth plan that focused on
increasing the number of billable tests served,” CNBC wrote.
FierceBiotech reported that, “According to previous
reports, the large insurers Anthem, Aetna, and Regence BlueCross BlueShield
have been examining the company’s billing practices for its physician-ordered
tests—as has the California Department of Insurance—with probes focusing on
possible financial connections between uBiome and the doctors ordering the
tests, as well as rumors of double-billing for tests using the same sample.”
Becker’s Hospital Review revealed that when the FBI
raided uBiome they seized employee computers. And that, following the raid,
uBiome had announced it would temporarily suspend clinical operations and not
release reports, process samples, or bill health insurance for their services.
The company also announced layoffs and that it would stop
selling SmartJane and SmartGut test kits, Becker’s reported.
uBiome Assumes New Leadership
Following the FBI raid, uBiome placed its co-founders Jessica
Richman (CEO) and Zac
Apte (CTO) on administrative leave while conducting an internal
investigation (both have since resigned from the company’s board of directors).
The company’s board of directors then named general counsel, John Rakow, to be interim CEO,
FierceBiotech
reported.
John Rakow (center) is shown above with uBiome co-founders Jessica Richman (lower left) and Zac Apte (lower right). In a company statement, Rakow stressed that he believed in the company’s products and ability to survive the scandal. His belief may be based on evidence. Researchers have been developing tests based on the human microbiome for everything from weight loss to predicting age to diagnosing cancer. Such tests are becoming increasingly popular. Dark Daily has reported on this trend in multiple e-briefings. (Photo copyrights: LinkedIn/uBiome.)
After serving two months as the interim CEO, Rakow resigned
from the position. The interim leadership of uBiome was then handed over to
three directors from Goldin
Associates, a New York City-based consulting firm, FierceBiotech
reported. They include:
SmartFlu: a nasal microbiome swab that detects bacteria and viruses associated with the flu, the common cold, and bacterial infections.
What Went Wrong?
Richman and Apte founded uBiome in 2012 with the intent of
marketing a new test that would prove a link between peoples’ microbiome and their
overall health. The two founders initially raised more than $100 million from
venture capitalists, and, according to PitchBook,
uBiome was last valued at around $600 million, Forbes
reported.
Nevertheless, as a company, uBiome’s future is uncertain. Of
greater concern to clinical laboratory leaders is whether at-home microbiology
self-test kits will become a viable, safe alternative to tests traditionally performed
by qualified personnel in controlled laboratory environments.
From point-of-care diagnostic tests to ancestral DNA home-testing, this company’s spit tubes are used by more medical laboratories than any other brand
Most clinical laboratory specialists know that OraSure Technologies of Bethlehem, Pa., was the first company to develop a rapid point-of-care DNA diagnostic test for HIV back in the 1990s. This was a big deal. It meant physicians could test patients during office visits and receive the results while the patients were still in the office. Since many patients fail to follow through on doctors’ test orders, this also meant physicians were diagnosing more patients with HIV than ever before.
Today, OraSure is the dominant company in the spit tube
industry. OraSure claims its tubes contain patented chemical preservatives that
can maintain the specimen’s integrity for up to two years at room temperature.
That’s a long time. And this one feature has made OraSure popular with
direct-to-consumer (DTC) genetic home-test developers.
OraSure provides nearly all of the specimen receptacles used
by individuals searching for their ancestral roots. It’s estimated that about
90% of the DTC genetic-testing market uses the company’s spit tubes. This is
partly because OraSure makes the only tubes approved by the US Food and Drug
Administration (FDA) for home DNA-testing purposes.
“The FDA approval gives customers confidence,” Mark Massaro, Managing Director, Senior Equity Analyst at investment bank Canaccord Genuity Group, told Bloomberg. “That, and they can preserve saliva for a long time.”
The OraSure spit tube above contains a patented mix of chemicals that can maintain saliva’s integrity for up to two years at room temperature. This is critical for ensuring specimens arrive at medical laboratories in usable condition to produce accurate test results. (Photo copyright: Zhongjia Sun/Bloomberg Businessweek.)
Spit, Close, Recap, Send
To use the saliva-testing DNA kits, an individual first
spits into the tube and then snaps the cap on the tube shut. This action
perforates a membrane which contains a patented, chemical mix of preservatives.
These chemicals help preserve the sample and minimize contamination from
non-human DNA that may be present.
“You’ve got to make it as easy as possible for a person to
spit in the tube, close the tube, recap the tube, and send it to you without
any variation,” Stephen
Tang, PhD, President and Chief Executive Officer at OraSure, told Bloomberg.
Saliva samples are very susceptible to environmental factors
like temperature and are extremely time sensitive. They need to be properly
handled and stored to prevent any degradation and ensure the most accurate test
results. Once in the spit tube, a saliva sample can last more than two years at
room temperature, according to the company.
“That’s the secret,” Tang stated. “Saliva is not pure. It’s
got a lot of bacteria and other stuff swimming in it.”
OraSure reported the company made $182 million in revenue in
2018, with about $20 million of that amount being profit. DNA Genotek, Inc., a subsidiary of OraSure
designed the T-shaped spit tubes being used for consumer-DNA testing kits.
Other Clinical Laboratory Uses for Specimen-Collection Devices
In addition to the consumer-DNA industry, OraSure’s tube technology is used in clinical and academic laboratory situations as well as in veterinary DNA testing. The company is focused on expanding the uses for their specimen-collection technology. They have recently begun using their technology to collect urine specimens for diagnosing sexually transmitted diseases and other conditions. OraSure also has added devices for feces collection, to better compete in the developing field of microbiome for gut bacteria analysis.
“We are all about the integrity of the sample collection,”
Tang says. “It’s a wide-open field.”
Ancestry Sued by OraSure
In 2017, Ancestry.com agreed to pay OraSure $12.5 million to
settle a lawsuit which alleged the company had copied OraSure’s patented DNA
testing technology to produce their own saliva-based DNA test.
According to the lawsuit, Ancestry.com purchased saliva test
kits from DNA Genotek in 2012 and 2013 for the purpose of collecting saliva
samples from their customers. In 2013, Ancestry.com filed for a patent of their
own for an improved variation of the kits reportedly without DNA Genotek’s
consent.
OraSure also has devices for substance abuse testing,
cryosurgical kits for the testing of skin lesions, and kits for forensic
toxicology.
Maintaining specimen integrity is critical to ensure lab
test results are accurate and reproducible. OraSure’s spit tube technology
solves the problem of preserving specimens while they are transported to
clinical laboratories and other pathology facilities.
If direct-to-consumer testing continues to attract healthcare consumers and financial investors, medical laboratories could have a new source of revenue
Many have tried but few have found the right formula to
offer medical laboratory tests directly to consumers. Direct-to-consumer lab
testing as a robust business model has been an elusive goal. But now one
entrepreneur wants to crack this market and just attracted $50 million in
venture capital to fund her idea!
Outsiders often establish industries. This was the case when Jeff Bezos created Amazon in 1994. The online retailer transformed the way books were sold and, subsequently, established a massive new retail market.
Along the same lines, Julia Taylor Cheek, Founder and CEO of EverlyWell, a well-financed digital health company based in Austin—hopes to build a similarly disruptive business in the clinical laboratory industry.
Cheek is increasing her company’s outreach to consumers by
putting some of the company’s direct-to-consumer (DTC) medical tests on store
shelves at CVS and Target.
A former consultant and Harvard Business School graduate, Cheek raised $50 million in financing to expand EverlyWell’s digital platform. According to a news release, “Just two full years into operation, EverlyWell is reporting 300% year-over-year customer growth and a world-class consumer Net Promoter Score (NPS).”
“I think it’s a representation of sexism in our space. There are 15 other companies that have popped up in blood testing and you don’t hear anyone comparing Theranos to those male-founded startups,” she told Inc.
However, Dark Daily believes Cheek may be missing one
basis for the comparison with Elizabeth Holmes. Holmes intended for Theranos to
serve consumers with lab testing, and let consumers order and purchase their
own medical laboratory tests. Cheek is talking about the same primary business
strategy of letting consumers purchase their own lab tests.
Armed with this additional financing from investors, EverlyWell intends to expand services and develop new partnerships with retail pharmacy chain CVS Health (NYSE:CVS) and for-profit insurance company Humana (NYSE:HUM).
The news release notes, “The company has also expanded its
product line to offer 35 panels, including first-to-market tests in fertility,
vitamins, peri- and post-menopause, and high-risk HPV. In addition, EverlyWell
has launched an end-to-end care model for consumers, now offering an
independent physician consult and prescription, if appropriate, for select STDs
and Lyme Disease testing. All of this is included in an upfront price before
purchase.”
EverlyWell Intent on
Bringing Medical Laboratory Tests to Retail
Earlier this year, EverlyWell made nine lab tests available in more than 1,600 Target store locations, MedCity News reported. This may suggest that retailers are intrigued with direct-to-consumer lab testing.
“We didn’t create new tests or technologies. Instead, we’ve built technology that empowers people to get tests more easily. Our medical director works with the labs to create panels that are already validated and clinically relevant and understandable for consumers,” Julia Taylor Cheek (above), Founder and CEO of EverlyWell told Forbes. (Photo copyright: Arnold Wells/Austin Business Journal.)
Cheek reportedly established EverlyWell after becoming
disenchanted with medical laboratory tests that she felt were not well
explained and too costly under high-deductible health plans.
Just two years on, EverlyWell reports “hundreds of thousands of customers and tens of millions in sales.” The company plans to add additional staff on top of its existing 70 employees in anticipation of the new funding, Austin Business Journal reports.
“We are building a consumer brand, which means we have to be where people shop. We need to be in places like CVS and Target to really allow for broader distribution and name recognition,” Cheek told the Austin American-Statesman.
What Draws People to EverlyWell?
EverlyWell offers home health test kits, priced from $49 to
$400 that people can order without a doctor’s prescription and pay for online. Users
take their samples (saliva, urine, or a pinprick of blood) with provided
lancets and cotton swabs, MedCity News
reported.
EverlyWell’s top selling tests are:
Food sensitivity-$159;
Thyroid function-$159;
Metabolism-$89; and
Vitamin D deficiency-$99.
EverlyWell says it is “first” in direct-to-consumer tests
for:
EverlyWell Test kits come with registration information, instructions, collection tools;
Biological samples are sent by consumers to CLIA (Clinical Laboratory Improvement Amendments)-certified labs that partner with EverlyWell;
Results are generally completed within 10 days depending on type of test and business volume;
A physician reviews the test results;
Reports on test results are electronically accessible through smartphone apps and online web dashboards.
“Lab testing is arguably one of the most important steps in preventing and managing illness but has been largely ignored by digital health companies. EverlyWell is successfully navigating an entrenched industry to offer consumers an opportunity to take charge of their own health,” said Eric Kim, Managing Partner at Goodwater Capital (which led the financing), in the news release.
“We’re building the definitive technology-enabled healthcare platform that consumers deserve and have already come to expect in other areas of their lives,” Cheek told VentureBeat. “As high-deductible plans become the norm, consumers are becoming discerning buyers who look for seamless, digitally enabled experiences.”
Learning from
EverlyWell
Of course, pathologists and medical laboratory professionals
will watch to see if EverlyWell can sustain its rapid rise in popularity with
healthcare consumers. In particular, those consumers who prefer DTC testing
over traditional clinical laboratory visits and who may be on high-deductible
health plans.
The DTC test market represents an opportunity that most
clinical laboratories have yet to take seriously. There are many reasons why
medical lab managers and pathologists would be taking a “wait and see”
attitude. Meanwhile, EverlyWell has $50 million of investors’ money to use to
demonstrate the financial viability of its strategy to encourage consumers to purchase
their own clinical laboratory tests—and even collect their own specimens at
home!
Genetic counselors struggle to explain direct-to-consumer genetic test data—or correct provider misinterpretations of results—while often encountering resistance and anger from patients who don’t accept their counseling
Healthcare consumers who want to know more about their family’s genealogy are purchasing direct-to-consumer (DTC) home genetic tests in record numbers. It is a trend that worries some medical laboratory professionals and certain federal government agencies.
MITTechnology Review (MIT) dubbed 2017, “The year consumer DNA testing blew up.” As a result of record-breaking sales of DTC genetic testing last year, about 12-million people have now been tested, MIT reported. “The inflection pointed started in the summer of 2016, and from there it’s gone into the stratosphere,” David Mittelman, PhD, Molecular Biophysics, told MIT.
Clearly, consumers are becoming comfortable with the concept of genetic testing on themselves and their family members. However, major issues—such as who owns genetic information and how patient privacy is protected—have yet to be resolved.
Dark Daily recently reported that more than 1.5 million kits were sold by Ancestry.com during the four-day Black Friday/Cyber Monday weekend prior to Christmas 2017. That e-briefing also explored related privacy issues and informed readers about efforts by federal lawmakers to explore genetic testing companies’ privacy and disclosure practices.
According to a news release, by the end of November, sales of AncestryDNA kits exceeded the total number of subscribers the Utah-based company had when it started the year. Now, more than seven million people are in Ancestry’s database.
Meanwhile, 23andMe, a personal genomics company established in 2006, has genotyped more than three million people worldwide. In addition to an ancestry test, it offers a health and ancestry service providing information on genetic health risks, carrier status, traits, wellness, and ancestry, according to the company’s website.
Experts Concerned About Privacy and Use of ‘Raw’ DNA Data
“2018 will bring a regular drumbeat of new experiences and enhancements across both DNA and family history,” Howard Hochhauser, Ancestry’s Interim Chief Executive Officer, predicted in the news release.
However, a recent study published in Translational Behavioral Medicine (TBM) which noted the robust sales of DTC genetic tests in 2017, also called attention to a new concern surrounding the impact of “raw” DNA interpretation results.
“People often enter the direct-to-consumer market for recreational purposes, such as learning about their ancestry. Yet, what we started seeing was that these same individuals subsequently come across third-party interpretation services where they proceeded to learn more about their ‘raw’ DNA made available by the ancestry testing companies,” stated Catharine Wang, PhD, Boston University (BU) Associate Professor of Community Health Sciences, and the study’s lead author, in a BU statement.
The study cited sales of DTC genetic tests at $99 million in 2017 and explored potential negative implications of consumers’ access to “raw” DNA data.
“We were especially interested in the downstream implications of receiving unexpected disease risk information from these newer services that subsequently lead consumers to seek out a genetic counselor’s consult,” Wang noted.
Catharine Wang, PhD (above), Associate Professor of Community Health Sciences at Boston University and lead author of the study, notes, “There are a lot of people saying, ‘I’m smart enough to make decisions; give me the information and get the doctors out of the way. But they’re making some serious decisions about their health after seeing only part of the picture.” (Photo copyright: Boston University Research.)
After Getting DNA Data, Consumers Turn to Interpretation Services, Genetic Counselors
The research team surveyed 85 genetic counselors. Fifty-three percent of them reported meeting with DTC test costumers who had accessed ‘raw’ DNA data and used genetic interpretation companies, which are not regulated by the US Food and Drug Administration (FDA), to get more information about themselves. However, results of the sessions were not always positive for either patients or counselors.
According to the study, counselors reported their biggest challenge as “undoing misinterpretations and correcting patient beliefs about their raw DNA results.”
The study noted, “When genetic counselors tried to clarify misunderstandings, patients were not only resistant but sometimes appeared hurt and frustrated that counselors were not taking their results seriously.”
Other negative experiences counselors reported while interpreting “raw” DNA test results for patients include:
“Time required to review and understand interpretation reports;
“Feeling ill equipped and uncomfortable providing the service;
“A lack of supportive organizational structure; and,
“[Having to] correct a patient’s misunderstanding, following a primary care physician’s misinterpretation of her raw DNA results.”
“Counselors expressed concern about the quality of the raw data and the clarity and usefulness of interpretation reports. Efforts to better support both consumers and genetic service providers are needed to maximize the effective translation of genome-based knowledge for population health,” the study authors concluded.
Providers Should Improve Ability to Help Patients with DTC Genetic Data
In a MedCity News blog post, Peter Hulick, MD, Director of Personalized Medicine, NorthShore University HealthSystem, called for healthcare providers to assist patients who are dealing with new DTC genetic services and possible data overload.
“Findings show having widespread access to personal genetic information—without the knowledge of how to interpret results—can lead to problems ranging from misinterpretation to emotional distress,” he noted. “The medical community must work harder and smarter to incorporate this information into practice and empower patients as consumers and partners in healthcare decision-making.”
Anatomic pathologists and clinical laboratory leaders also should acknowledge and monitor consumers’ growing interest in these tests. Once patients’ have their DNA sequenced, the likelihood they will seek to know their predisposition to diseases is high and increasing. Thus, opportunities exist for medical laboratories to help physicians and consumers interpret DTC test results.
