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Genetic-testing startups are finding that selling consumers insights on their risk of getting cancer may not be as easy as telling them about their Irish roots.
23andMe Inc. and Ancestry.com LLC have capitalized on the public's insatiable appetite for discovering their family trees. However, consumers have balked at paying other companies for health analysis of their DNA. Some testing firms are finding it works better when health care providers are more directly involved. That way patients are better able to understand test results and integrate them into their care.
Helix, which launched in 2015 with $100 million from genome-sequencing giant Illumina Inc., had planned to sell tests directly through an "app store'' for DNA. Instead, it's now looking to partner with health care providers. Illumina said on April 25 that it would no longer hold equity or participate on Helix's board, ending the partnership.
Color Genomics has also changed course. It began by offering doctor-prescribed tests to consumers, but in January it said it would shift focus to partnerships that incorporate genetic testing into primary care for large numbers of patients. And recently 23andMe has drawn criticism for cancer tests that critics say can mislead consumers without a professional's input.
"It works really, really well when your partner can directly provide the follow-on care that people need, because that's what people are looking for," said Justin Kao, a co-founder of Helix and senior vice president of business development and partnerships. "They want to know how to take their information and take action on it. That caused us to rethink some things.''
When Helix rolled out its "app store'' in 2017, the idea was that customers would pay Helix to sequence their DNA. They would then purchase DNA apps from other companies selling products on the Helix platform, depending on whether they were curious about ancestry or health, or perhaps in the market for custom socks printed with their own genetic code. In addition to Illumina, investors included the venture capital firms Kleiner Perkins, Warburg Pincus and DFJ Growth.
Changing Course
But now Helix is shifting gears. It deemed a partnership last year with the Healthy Nevada Project to sequence DNA of state residents so successful that it announced a similar deal with AdventHealth in Florida last month. In both arrangements, Helix sequences DNA and screens for specific genetic conditions, then passes that information along to its health care partners, which follow up with patients. For Helix, the arrangements give it access to large pools of customers in one fell swoop.
Color Genomics has also moved toward selling its services to companies that offer health care to large numbers of people. In January, it inked a deal with NorthShore University HealthSystem in the Chicago area to offer its kits to more than 10,000 patients. It also sells its services to several employers, which offer DNA testing as a benefit alongside insurance.
