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the timing has improved this year for data analytics companies offering clinical interpretation, though it’s still a very early market.
“Three years ago, I don’t think many people believed that there was a standalone business opportunity,” Cournoyer says. But the tide seemed to turn in January at the big J.P. Morgan Annual Healthcare Conference, she says. Analysts were seeing the value. “It was like a light bulb went on and the market opened up,” Cournoyer says.
This year, N-of-One has signed on with 10 new partners. Four are hospitals or healthcare systems, including the Mayo Clinic and Cedars-Sinai’s Samuel Oschin Comprehensive Cancer Institute in Los Angeles. Four are diagnostics companies, and another two are software companies that, like N-of-One, are bringing the tools of data analysis into the interpretation of genetic and molecular test results. One of these is Palo Alto, CA-based Syapse, which has integrated its software with UC San Francisco’s electronic medical records system. The other is St. Louis, MO-based bioinformatics company Appistry.
As a private company, N-of-One has no obligation to disclose the revenues it’s receiving from its partnerships, so it can’t be compared with CollabRx by those measures. N-of-One was funded by angel investors, and doesn’t disclose its total fundraising.
N-of-One is extending the scope of its clinical interpretation work beyond DNA sequencing alone to include other molecular diagnostics, such as protein expression, Cournoyer says. The company, which focuses on oncology, has nearly 40 employees.
Market growth for next-generation DNA sequencing is still constrained by limited reimbursement from health insurance plans. That’s gradually changing, says consultant Irene Rombel, president and founder of Biomedical Intelligence in Hockessin, Delaware.
“It’s still very early in the adoption curve, but we’re starting to see more widespread and consistent reimbursement,” says Rombel, who has done some consulting for N-of-One.
More reliable reimbursement would increase testing volumes, which could benefit independent data analytics companies that interpret the tests. But that would also make the clinical interpretation business more attractive to big players in the sequencing equipment industry, such as Illumina and Life Technologies.
As next-generation sequencing becomes more widely used, the tests will generate an ever-growing body of valuable information for treating physicians, Rombel says. “So it’s not surprising that we’re seeing big sequencing enterprises such as Illumina starting to build their own capacities to collect and interpret that information.”
Big sequencing businesses have recently acquired companies that bring important capabilities in-house, such as the analysis and interpretation of complex biological data, with an eye towards clinical data, Rombel says. She points to Illumina’s acquisition of Santa Clara, CA-based NextBio in 2013; Netherlands-based equipment maker Qiagen’s acquisition of Redwood City, CA-based Ingenuity in 2013; and Life Technologies’ acquisition in 2102 of Ann Arbor, MI-based Compendia Bioscience.
Those acquired companies had developed genomics databases that helped researchers understand the molecular basis of disease, while helping pharmaceutical companies identify molecular targets for new drugs. The widening interest from major sequencing companies could also bring new opportunities for independent data analytics businesses that use their knowledge to guide the treatment of individual patients.
“It would be logical for the sequencing companies to round out their skills by adding the clinical interpretation component, through partnerships or acquisitions of stand-alone data companies that already have extensive databases and proven analytical tools,” Rombel says.