Direct-to-Consumer Clinical Laboratory Test Developer, EverlyWell, Receives $1 Million in Funding from Shark Tank Investor

Direct-to-consumer medical laboratory testing company gets a major shot in the arm as developers find ready investors and increasing consumer demand

Clinical laboratory tests, usually performed without fanfare, were thrust into the limelight during a recent episode of Shark Tank, an American reality TV show on which aspiring entrepreneurs compete for the attention and partnership funds of various investors.

EverlyWell, a direct-to-consumer (DTC) company that offers at-home lab tests without lab visits or doctor referrals, obtained a $1-million line of credit from Lori Greiner, one of Shark Tank’s participating entrepreneurs, according to MobiHealthNews. EverlyWell has consumers collect their own specimens at home, which are then sent to a medical laboratory testing facility.

Based in Austin, Texas, EverlyWell was founded in 2015 by Julia Taylor Cheek, CEO, with an aim to “make lab tests accessible, simple, and meaningful,” according to a news release. Cheek is also a Venture Partner with NextGen Venture Partners and formerly the Director of Strategy and Operations with the George W. Bush Institute.

“It’s incredible for the industry that we were selected and aired on a show like Shark Tank. It really shows the intersection of what’s happening in consumer healthcare and the high cost in healthcare and that people are really responding to new solutions,” Cheek told MobiHealthNews.

“I think the product is brilliantly crafted,” Greiner stated during the episode’s taping, according to MobiHealthNews. “It’s really nice; it’s really easy. It’s super clear. I think the state of healthcare in our country now is so precarious. I think this gives people an empowered way … to know whether or not they have to go find a doctor,” she concluded.

Greiner offered the $1 million line of credit (with 8% interest) in exchange for a 5% equity stake in EverlyWell, explained Austin360. According to SiliconHillsNews, she did so after reviewing certain EverlyWell financial indicators, including:

  • $2.5 million in revenue in 2016;
  • $5 million expected revenue in 2017; and
  • 20% monthly growth rate.

Julia Cheek, CEO and Founder of EverlyWell (above), in a news release following her success on reality show Shark Tank, said, “We’re leading a major shift in the consumer health marketplace by bringing the lab to consumers’ doorsteps, and we are moving quickly to expand our channels, launch innovative tests, and deliver a world-class customer experience.” (Photo copyright: Forbes/Whitney Martin.)

Physician Review Still Part of Home-testing Process

EverlyWell lists 22 home lab tests on its website and a market share that encompasses 46 states. Shoppers can search for specific tests based on symptoms or by test categories that include:

  • General Wellness;
  • Men’s Health;
  • Women’s Health;
  • Energy and Weight; and
  • Genomic Test (through a partnership with Helix, a personal genomics company).

The most popular test panels include:

  • Food sensitivity;
  • Thyroid;
  • Metabolism;
  • Vitamin D; and,
  • Inflammation.

Prices range from $59 for a glycated hemoglobin (HbA1c) test (found under the general wellness category) to $399 for a women’s health testing kit. EverlyWell explains that it has no insurance contracts for these diagnostic tests, which do not require office or lab visits.

The testing process, according to EverlyWell’s website, proceeds as follows:

  • After ordering and paying online, kits arrive at the customer’s home;
  • The consumer self-collects a sample (such as blood spots, dried urine, or saliva) and returns it by prepaid mail to a medical laboratory that partners with EverlyWell. The company notes that it works with CLIA (Clinical Laboratory Improvement Amendment)-certified laboratories;
  • A board-certified doctor reviews the lab results; and,
  • A report is available online in a few days.

“Our goal is not to remove the importance of physician review. It’s to make the experience easier for the consumer,” Cheek told Texas CEO Magazine. “We designed a platform that is all about access and empowering consumers to have access to and monitor their own health information,” she continued.

Texas CEO Magazine explained that Cheek was inspired to create the company following “a bad personal experience with health and wellness testing that sent her to seven different specialists, cost $2,000 out of pocket, and left her with pages of unreadable results.”

Since then, the three-year old start-up company has garnered more than $5 million in venture capital, noted the news release.

Many Choices in Direct-to-Consumer Lab Company Market

EverlyWell is not the only player in the DTC clinical laboratory test space. According to MedCityNews, there are at least 20 other DTC lab test companies in the market including:

  • 23andMe;
  • Laboratory Corporation of America (LabCorp);
  • Mapmygenome;
  • Pathway Genomics;
  • Quest Diagnostics (Quest);
  • Sonora Quest Labs;
  • Theranos; and others.

The direct-to-consumer lab test market grew from $15 million to about $150 million in 2015 and includes both large and small clinical laboratory test developers, noted Kalorama Information.

Clearly, the DTC testing market is expanding and garnering the attention of major developers and investors alike. This growing demand for home-testing diagnostics could impact anatomic pathology groups and smaller clinical laboratories in the form of reduced order testing and decreased revenue.

—Donna Marie Pocius

Related Information:

Mail-Order Lab Test Startup EverlyWell Makes Million Dollar Deal on ABC’s Shark Tank

EverlyWell Raises Additional Capital, Bringing Total to $5 Million

This Austin Entrepreneur Scored Historic Deal on Shark Tank

Austin-based EverlyWell Lands Deal on Shark Tank

Innovative Texas Businesses: Empowering Consumers; Julia Cheek’s EverlyWell’s Health and Wellness Testing

Meet the Start-up Revolutionizing the Lab Testing Industry

20 Key Payers in the Direct-to-Consumer Lab Testing Market

Direct-to-Consumer Services Put Down Roots in US Lab Testing Market

Clinical Pathology Laboratories Should Expect More Direct-to-Consumer Testing

Sales of Direct-to-Consumer Clinical Laboratory Genetic Tests Soar, as Members of Congress Debate How Patient Data Should be Handled, Secured, and Kept Private

Medical Laboratory Screening Tests for Inherited Genetic Disorders Gain Popularity Amid Global Genetic Testing Market Double-Digit Revenue Growth

Lack of Medicare or third-party payer coverage for most genetic screening tests in healthy adults is not discouraging development of new gene testing products

With the global anatomic pathology genetic testing market poised to reach $9.8 billion by 2025, clinical laboratories continue to develop new genetic screening tests (rather than diagnostic tests) intended to help physicians identify patients who carry inherited genetic mutations that could put them or their future children at higher risk for chronic disease, such as cancer.

This is a bit of a gamble since (with some exceptions) Medicare and many health insurers typically will not pay for predictive and presymptomatic genetic tests and services used to detect an undiagnosed disease or disease predisposition.

Nevertheless, Inkwood Research of Gurugram, India, predicts in its “Global Genetic Testing Market Forecast 2017-2024” report that aging populations throughout the world will be the driving force producing “enormous opportunities for the global genetic testing market.” The research firm anticipates this will result in a 9.93% increase in annual sales revenue during each of the next seven years.

Screening versus Diagnostic Testing Gains Popularity Among Patients, Physicians

Genetic diagnostic testing promises to accelerate the growth of precision medicine by guiding the diagnosis and treatment of cancer and other chronic diseases. However, genetic tests that “screen” healthy patients for predispositions to certain diseases also are gaining traction in the marketplace.

The US Food and Drug Administration (FDA) gave direct-to-consumer genetic screening testing a boost in April 2017 when it allowed marketing of 23andMe Personal Genome Service Genetic Health Risk tests for 10 inherited diseases or conditions, including:

·       Parkinson’s Disease;

·       Late-onset Alzheimer’s Disease;

·       Celiac Disease; and

·       other conditions.

“Consumers can now have direct access to certain genetic risk information,” Jeffrey Shuren, MD, Director of the FDA’s Center for Devices and Radiological Health, said in a press release. “But it is important that people understand that genetic risk is just one piece of the bigger puzzle, it does not mean they will or won’t ultimately develop a disease.”

Robert Green, MD, MPH, a Professor of Medicine at Harvard Medical School, told NPR that consumers should have access to genetic information. However, they also need to understand its limitations.

“Some people really want this [genetic] information on their own, and others want it through their physician,” Green said. “Both those channels are legitimate. People should just be aware that this information is complicated.”

According to the Inkwood Research report, “The global genetic testing market is anticipated to grow from $4,614 million in 2016 to $9,806 million by 2025, at a CAGR [Compound Annual Growth Rate] of 9.93% between 2017 and 2025. The important driver increasing growth in the global genetic testing market is an aging population on the rise. The rising geriatric population is driving the global genetic testing market to a significant level.” (Caption and graphic copyright: Inkwood Research.)

One example of genetic screening tests is the Quest Diagnostics (NYSE:DGX) QHerit Pan-Ethnic Expanded Carrier Screen, which offers couples the opportunity to test for 22 genetic diseases that could be passed on to their children, including:

·       Cystic Fibrosis;

·       Sickle Cell Disease; and

·       Spinal Muscular Atrophy.

The genetic screening panel tests for the 22 heritable diseases cited by the American College of Obstetricians and Gynecologists (ACOG) in a Committee Opinion on genetic carrier screenings published by the ACOG in March 2017.

“The United States is truly a melting pot, and it no longer makes sense for physicians to assume genetic screening is appropriate for an individual based on presumed race or ethnicity,” Felicitas Lacbawan, MD, Executive Medical Director, Advanced Diagnostics, Quest Diagnostics, stated in a press release. “QHerit is designed for any woman and her partner, not just those in a specific, so-called high-risk ethnic or racial group.”

Genetic Screening in Primary Care Helps Assess Risk for Chronic Disease

Genetic diagnostic test developer Invitae (NYSE:NVTA) also points to growing evidence of the genetic screening test’s value to healthy individuals. In September 2017, Invitae presented initial findings at the National Society of Genetic Counselors 36th Annual Conference. The study showed a retrospective analysis of 120 patients tested with a proactive genetic screening panel for healthy adults had revealed medically significant findings for nearly one in five patients.

“Interest among otherwise healthy adults in using genetic information to understand their risk of disease conditions continues to grow each year, ” Robert Nussbaum, MD, Chief Medical Officer of Invitae, said in a press release. “These and other data show that interest is well-placed, with a substantial group of patients showing genetic variants associated with elevated risk of diseases like cancer where monitoring and early intervention can be helpful. Use of genetic screening in the primary care setting can assess risk to help shape individual screening plans. We are continually adding tools and resources that help reduce barriers to the widespread use of genetic information in mainstream medical practice.”

Routine Genetic Screening Could Become Norm, CDC Says

The Centers for Disease Control and Prevention (CDC) notes that newborn screening is “currently the largest public health genetics program in the world,” with more than four million babies screened at birth each year for 30 or more genetic conditions. In the CDC’s “Genomics and Health Impact Blog,” the agency continues to maintain a “cautionary attitude about personal genomic tests” beyond the newborn period, directing those considering direct-to-consumer laboratory testing, such as 23andMe and MyMedLab, to “think before you spit.”

Nonetheless, the CDC acknowledges routine genetic screening of healthy people could become the norm. However, others advise caution.

“To be sure, while the use of genome sequencing is promising in certain clinical scenarios, such as rare diseases and cancer, we do not think that whole genome sequencing in the general population is appropriate at this time,” Muin J. Khoury, PhD, MD, Director, Office of Public Health Genomics, CDC, wrote in a January 30, 2017, blog post. “We would not recommend its use outside research studies … But it is also becoming clearer that as science progresses, we are discovering more opportunities for using genetic screening of healthy individuals for preventing common diseases across the lifespan, outside of the newborn screening context.”

The impact on clinical laboratories and anatomic pathology groups should genetic screening become normalized should be clear: Labs will be tasked with performing these tests, and pathologists will be needed to interpret them and educate both physicians and patients on the findings.

Before that, however, genetic screening tests will need to be fully supported by government, and insurers, including Medicare, will have to agree to pay for them.

—Andrea Downing Peck

Related Information:

Global Genetic Testing Market Forecast 2017-2024

Carrier Screening for Genetic Conditions

Quest Diagnostics Launches QHerit, a Pan-Ethnic Genetic Screening Panel Aligned with New Medical Guidelines

Invitae Expands Test Menu for Proactive Genetic Testing in Healthy Adults

Invitae Highlighting New Research, Expanded Suite of Services at National Society of Genetic Counselors (NSGC) 36th Annual Conference

Consumer Genetic Testing: Think Before You Spit, 2017 Edition

Genetic Screening of Healthy Populations to Save Lives and Prevent Disease

FDA Allows Marketing of First Direct-to-Consumer Test that Provide Genetic Risk Information for Certain Conditions

FDA Approves Marketing of Consumer Genetic Tests for Some Conditions