The cost of genetic testing has plummeted, but it’s still out of reach for thousands of patients. But today, a San Francisco-based biotech company, Invitae, is expanding its suite of tests for neurological disorders, rare diseases, and pediatric conditions at a price point that is designed to be affordable to most people.
Invitae already offers panels, or groups of tests, for a variety of genetic disorders in cardiology, neurology, and pediatrics. It also offers genetic tests to assess a patient’s risk for hereditary cancers such as breast, colon, and pancreatic cancer. In the past few years, it increased its analysis from 200 genes in production to 1,000, meaning it is able to glean a vast amount of genetic content.
What stands out is the company’s pediatric screening, which is designed to complement routine newborn screenings. Today, millions of babies in the U.S. are tested for genetic, endocrine, and metabolic disorders. But about one in every six infants gets a false positive result, according to Invitae’s chief medical officer Robert Nussbaum, who is a practicing medical geneticist at UC San Francisco. Invitae’s pediatric tests examine whether the results are true positives, and, if so, hone in on the best course of treatment.
“This development is pointing to the day when we can very quickly test newborns for any genetic condition that might put them at risk early in life,” says Nussbaum.
Economies of Scale
Invitae, a five-year-old company that went public in 2015, is one of a growing number of companies that is taking advantage of the plummeting cost of whole genome sequencing. In 2011, the late Apple CEO Steve Jobs spent $100,000 to find out the genetic roots of the cancer that later killed him. Now, an equivalent test would be available for about $5,000.
But Invitae’s competitive edge, according to its CEO Randy Scott, is that it’s “aggregating a large number of genetic tests into a single platform.” Today, a lab tests patients gene by gene. That gets expensive when the patient has a multi-genetic disease, or a set of symptoms that are caused by a variety of genetic conditions.
“Historically just a single gene test is in the $1,000 range,” says Scott. “We look at up to one thousand genes, which gives us improved economics. We hope to one day become the Amazon of medical genetics,” he explains.
The highest-price for a genetic test offered by Invitae is $1,500 for out-of-network providers. Most in-network tests are available at $950, with a discount offered to patients who don’t have insurance. Patients are required to have a prescription from a doctor, which in many cases is a medical geneticist rather than a pediatrician or primary care doctor. (As we recently reported, many doctors are not educated about the still-nascent field of genetics.)
The company is currently losing money on each of the tests it offers. But by the end of 2016, Scott expects that the company will start making money. “Genetics is a volume-dependent business,” he says. “We hope to flip to being profitable.”
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