CEO Hesaam Esfandyarpour says the Redwood City, Calif.–based company’s Sequencer, a table-top device that carries a price tag that’s about 1/100th of existing systems, will make will make genetic sequencing available to the vast majority of research institutions that can’t currently afford larger systems that can cost up to $1 million.
He suggested that less than 2% of the 400,000 molecular labs across the globe have their own sequencing equipment, presenting a huge target for the company’s expanding sales team.
The CEO — who launched the company in 2010 after several years of research at Stanford — said the $9,995 price tag and relatively low cost for supplies also could be affordable enough for hospitals to build out their own genetic sequencing labs, saving the time and costs of sending samples to third parties.
At the heart of the system is a CMOS (Complementary Metal Oxide Seminconductor) Chip used to input samples into the machine. GenapSys currently offers chips with 1-million and 16-million sensors but a 144-million chip the company plans to roll out could allow customers to run a wider array of tests.
GenaSys execs also see longer-term opportunities in consumer and other fields that could develop productive uses for the machine Esfandyarpour equated the sequencer to a broad platform developers outside the company could stand upon. “Essentially, we have created the iPhone,” Esfandyarpour said. “If you have an app for agriculture, we can support that.”
Fifteen years ago, the company’s origins rose from a personal tragedy. Without giving specifics, Esfandyarpour says a young relative was misdiagnosed, leading to an “extremely complicated and lifelong lasting complication.” Esfandyarpour, an engineer studying radar at Stanford, turned his sights onto finding a better way to test for disease.
The company grew from the idea of using electronic signals, rather than fluorescent signals, to identify genetic markers associated with disease. Esfandyarpour theorized the use of electronics would allow sequencers to function without optical equipment, lasers, cameras, scanners and robotic systems that legacy systems rely upon. He brought the concept to Ron Davis, director of Stanford’s Genome Technology Center at Stanford University. “He told me,`If you can build these it will be a PC in a world of mainframes when it comes to genomics.”
Esfandyarpour pushed forward. Davis now serves on the company’s advisory board along with George Church, professor of genetics at Harvard Medical School; Eric Topol, drector of the Scripps Translational Science Institute; and Michael Snyder, director of the Stanford Center for Genomics and Personalized Medicine.
The blue-chip advisory team helped GenapSys stand out in a field that’s taken a hit recently with the particularly high-profile – and Hollywood ready – tale of Theranos. GenapSys executives similarly are making heady claims about its Sequencer system, insisting it can match the gold-standard for testing for a fraction of the costs. Without naming the company, Esfandyarpour acknowledged the recent controversy has required the company to build a stronger case.
GenapSys took steps to back up its claims with data and third-party validation. Esfandyarpour says GenapSys partnered with “some of the leading labs in the country” to run the Sequencer through the paces.
Jackson Laboratory, for example, a leading global nonprofit biomedical research institution, presented results at the American Society of Human Genetics meeting in Houston that suggested the GenapSys sequencers are “superior to optical detection methods in detecting nucleotide mutations, a critical task used for cancer and inherited disease detection,” according to the company. “Jackson had our machines for many months,” Esfandyarpour says. “It showed our quality was not only as good but outperformed [legacy] sequencing.”
Biotech investor Foresite Capital, the leader of the new round, said in a statement that it conducted “extensive due diligence on the platform.” A Foresite representative couldn’t be reached for comment, but Esfandyarpour said the firm’s research including running samples of the same blood through the sequencer and standard lab equipment. Once the Sequencer proved itself Foresite invested.
Asked about how Theranos’ unraveling impacts how he positions GenapSys’ storytelling, Esfandyarpour says the sordid details have “reduced the amount of interest from investors and it’s very unfortunate. But there’s a right way of doing things and a wrong way. And we are really focused on making sure we do it the right way.”