23andMe Adds On: More About The Gene-Test Maker’s Drug R&D Ambitions

Xconomy San Francisco — 

As I reported earlier, 23andMe today announced its intention to pursue pharmaceutical R&D, in addition to its business selling direct-to-consumer genetic test kits. To lead its new drug research group, it has tapped Richard Scheller, the longtime head of research at Genentech and a distinguished neuroscientist.

Scheller wasn’t available to talk today, but after posting my earlier story, I had a conversation with 23andMe president Andy Page, who joined the company in 2013 after working for many years in Internet commerce and finance. Page filled in more details and gave updates on other facets of the company’s business.

A few quick bullet points:

—23andMe will continue its direct to consumer business.

—23andMe will raise capital soon to finance the new drug group.

—Scheller’s group could grow to roughly 15 people by year’s end.

—Most of the work this year will focus on data analysis, not “wet lab” work.

—Scheller will be in charge of pipeline and partnering decisions for the drug programs.

—23andMe does not gather health information through wearable devices, nor does it have near-term plans to do so.

I first asked Page when 23andMe decided to get into drug development. He said that for years, several people outside the company, including Art Levinson—the former CEO of Genentech, now CEO of Calico—have raised the question with CEO Anne Wojcicki of what to do with the 23andMe data once the database became large enough. “We always were and always will be a consumer company first, but doing research is a close second,” says Page.

Andy Page

Andy Page

When 23andMe partnered with Genentech to collaborate on Parkinson’s disease research, Scheller, then the head of research and early development at Genentech, “was the point on that deal. He saw our database, saw its potential, and suddenly it became the intersection of a lot of good things happening at the same time.”

“A couple days after he announced his retirement from Genentech, the agreement [to join 23andMe] came together at Anne’s house.” (Which means that Scheller had already agreed to his new job when the Genentech-23andMe deal was announced this January.)

So what was the threshold, I asked? How and when did the database become ‘large enough’ for 23andMe to do its own drug discovery work with it?

First, said Page, was the scale. It now contains the information of nearly 900,000 people. It’s not just their genomic information. 23andMe uses surveys to build other layers of information, too: age, gender, ethnicity, and so on. For people with specific diseases, the survey asks questions such as “what drugs are you taking” and “when did you first start to notice symptoms,” Page said.

“We have 250 million questions answered, and we’re constantly looking for ways to enrich the database,” he said.

Also driving the decision was a certain number of what 23andMe calls “escapers,” or people who have a mutation associated with a disease, yet they don’t have the disease. “They don’t show up in the medical system [because they don’t get sick], but they show up in our database.” For competitive reasons, Page declined to say how many of them, and with which mutations, are in the 23andMe database.

(Page is unrelated to Google CEO and cofounder Larry Page. Google was an early investor in 23andMe.)

With the launch this week of Apple’s ResearchKit program to let iPhone users contribute their health data into various disease research areas, I asked Page if 23andMe was also gathering data through wearable devices and the like—or if it planned to do so. “Whether we partner with a wearable company or not, we definitely think genetics should be married with all the other info being tracked. That will come in time. We’re looking forward to being able to do that,” he said.
But it’s not happening now. “Taking in wearable device data right now is not core to our near term strategic objectives,” Page said.

A big part of the company’s focus is “working with FDA in order to seek permission, or to have permission granted, to market the health portion of our product in North America,” Page said. In other words, to do what FDA banned … Next Page »

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