23andMe Kills Its Next Generation Gene Sequencing Project, Cuts Jobs

October 27, 2016
By Alex Keown, BioSpace.com Breaking News Staff

MOUNTAIN View, Calif. – Genomic company 23andMe has halted its plans to develop a new gene-sequencing program that would have allowed customers to learn more about potential predisposition to genetic diseases.

23andMe Chief Executive Officer Anne Wojcicki made the announcement Wednesday during the Wall Street Journal’s technology conference. The company scrapped the plans not due to any problems with the technology, financial or regulatory concerns. No, Wojcicki said the problem was the data was so complex that it might not do the consumer any good. Because the company has a direct-to-consumer product as opposed to direct-to-physician, Wojcicki said the gene-sequencing project just would not fit that model, CNET reported this morning.

The closure of the project opens up the door to other gene-sequencing companies, such as Helix, which sprang from Illumina , or Color Genomics, which recently raised $45 million in financing. Color’s test covers eight of the most common hereditary cancers, including breast, ovarian, colorectal, pancreatic and prostate cancers.

"Genetics is complicated," Wojcicki said at the WSJ conference, according to CNET. "As a company, we are really focused on direct to consumer. Without a doubt we are a consumer product. We're not going through a physician. There is no other company out there that is direct to consumer."

During the interview, Wojcicki said some patients may get information they have a 5 percent chance of developing breast cancer. But, what would, or should, a customer do with that information, she asked? Because the company has a direct-to-consumer focus, Wojcicki said what the company provides “needs to be extremely clear,” Engadget reported.

“We want to give information to individuals where there's no ambiguity," she said.

23andMe may have scrapped the project to avoid any regulatory concerns, especially in light of some of the issues the company faced in the past. In 2013, the FDA sent a warning letter to the California-based company, saying it must discontinue marketing its health-related genetic tests. The company was forced to stop selling the kits for medical or diagnostic uses, although they could continue to sell them without offering clinical diagnostics. Eventually though the company began to resell health data. The U.S. Food and Drug Administration approved 23andMe’s Personal Genome Service that provides carrier status, wellness, trait and ancestry reports to consumers in October 2015. The test is available for $199 and will include more than 60 health, ancestry, wellness, and personal trait, as well as personalized insights based on analysis of 650,000 genetic variations according to a company statement.

With the scrapping of the project, also came some terminations. BuzzFeed noted that about six researchers working on the project were laid off, as was Jill Hagenkord, the chief medical officer who was overseeing that work.

23andMe has been looking at expanding beyond the development of DNA testing and exploring the possibility of developing its own medications. In July, the company raised $79 million to partly fund that effort. Additionally, the funding will likely help the company continue with the development of its new therapeutics division. In March, 23andMe began to delve into the therapeutics market, to create a third pillar behind the company’s personal genetics tests and sales of genetic data to pharmaceutical companies. Additionally the company has a deal with Pfizer Inc. to enroll more than 10,000 patients with colitis or Crohn’s disease. In May, 23andMe inked another deal with Pfizer to launch the Lupus Research Study. The aim is to enroll 5,000 individuals with systemic lupus erythematosus to better understand the genetics of lupus. The effort is also in collaboration with the Lupus Research Institute.