The market for bioinformatics services and software may soon surpass that for sequencing technologies, such as the one depicted here, in which laser light is used to help sequence DNA in glass slides.

David Paul Morris/Bloomberg via Getty Images

For Chaim Jalas at the Center for Rare Jewish Genetic Disorders in New York, DNA sequencing is the easy part. It costs less than US$1,500 per person to have the important parts of his clients genomes sequenced. But it would be dauntingly expensive to maintain servers and staff to analyse the data and identify mutations that might be causing the undiagnosed diseases that afflict his clients families.

So Jalas, the centres director of genetics resources and services, has outsourced parts of the analysis. He uploads his clients sequencing data to cloud-computing software platforms, where he can run analyses without having to set up the infrastructure in-house. The cost is about $100 per person. And the cloud-based interfaces let him collaborate with doctors in Israel without worrying about repeatedly transferring data on slow Internet connections. For me, it is convenient and cost-efficient, he says.

Jalas and the way he works represent a new and mostly untapped market for a new crop of genetics interpretation and analysis firms, which will be touting for customers at a meeting of the American College of Medical Genetics and Genomics in Phoenix, Arizona, on 1923March. Dozens of these firms have emerged, some in the past year, as ever more affordable sequencing moves from academia into the clinic (see Nature 494, 290291; 2013). Doctors will increasingly want to use sequencing data to guide decisions about patient care, but might not necessarily want to invest in staff and software to make sense of those data.

Its a huge unmet need, says David Ferreiro, a biotechnology analyst with investment bank Oppenheimer & Company in New York, which invests in many sequencing-technology and -analysis companies.

Where there is a need, there is also money to be made. The companies, many of them based in Californias Silicon Valley, have been tempted by a market in outsourced sequencing and analysis software that by 2016 could top $4billion per year, according to BCC Research, a market-research company in Wellesley, Massachusetts (see Genes in the marketplace). The skys the limit, says Andreas Sundquist, chief executive of DNAnexus in Mountain View, California, which provides genetic-analysis software on its cloud-based platform and allows users to upload and run their own algorithms.

Source: BCC Research

Other firms offer a range of approaches. Seven Bridges Genomics, based in Cambridge, Massachusetts, aims to be accessible to people with no expertise in bioinformatics, and provides access to free tools for designing custom-made analysis pipelines. Ingenuity Systems in Redwood City, California, allows users to upload a list of mutations in a persons genome, and finds those most likely to cause disease. Personalis, down the road in Menlo Park, offers sequencing services and interpretation for clinicians and pharmaceutical and biotechnology companies. Last week, the company won a $1.53-million contract with the US Department of Veterans Affairs to look for genetic variants in samples from as many as onemillion military veterans, to explore the variants roles in disease. (The company will outsource the sequencing to Illumina, a market leader in sequencing technology based in San Diego, California.)

The activity is reminiscent of that a decade ago, when bioinformaticians started up a flurry of companies, most of which were unsuccessful because the path from a genetic-disease marker to a profitable drug has not been straightforward. Todays companies have moved on to other challenges, says Steven Brenner, a computational genomicist at the University of California, Berkeley. He says that they will have to prove that their products are better than freely available software and do so without disclosing their intellectual property. These companies have a tricky situation, he says.

Excerpt from:
Gene -analysis firms reach for the cloud

Comments are closed.