This is a sponsored article from Hermes Investment Management.
Scientists believe advanced genetic sequencing is capable of fulfilling one of the greatest promises of medicine: deciphering the human genome – the genetic code of each organism – and paving the way for major advances in medical research and treatment. That is why leading companies in this field are firmly aligned with the Health and Well-Being theme of the Hermes Impact Opportunities Equity Fund.
In the years since the human genome was first sequenced in 2003, researchers have gained unprecedented insights into genetic factors that cause or influence disease. However, much more can be achieved with Next-Generation Sequencing (NGS), which is able to handle much higher throughput volume and allows scientists to progress from sequencing one DNA fragment at a time to millions in a single run.1
The wealth of genomic data that NGS provides could accelerate progress in precision medicine – individually tailored treatments that researchers hope will eventually help correct genetic deficiencies linked to major diseases including diabetes and cancer, conditions targeted by the UNDP’s Sustainable Development Goal of good health and well-being. The magnitude of its potential impact is underscored by the fact that genetic diseases currently account for 45-51% of deaths in neonatal intensive care units and 60% of end-of-life admissions.2
The increasing prominence of genetic sequencing is intrinsically linked to its affordability. As the process becomes less expensive, more genes can be sequenced and higher volumes of data generated, yielding ever greater insight. The cost of genetic sequencing has fallen dramatically, confounding Moore’s law that computing power doubles and prices halve every two years.
Indeed, the cost of sequencing the first human genome by the Human Genome Project in 2003 is estimated to have been between US$500 million and US$1 billion.3 Researchers have now broken the US$1,000 genome barrier, widely considered the threshold at which NGS will become commonplace in medicine (see figure 1).
Genetic sequencing, once an expensive tool reserved for academic and Government research, is now rapidly beginning to inform clinical practices and even the consumer market, and is likely to reshape medicine as we know it.
We believe two companies we invest in – Illumina and Qiagen – generate impacts that support targets for the Sustainable Development Goal of good health and well-being.
Illumina: a giant of genomics
More than 90% of the world’s sequencing data has so far been generated by using Illumina technology4, giving it a commanding share of the NGS market. The work of the San Diego-based company has significantly driven down the cost of genetic sequencing.
In particular, Illumina is credited for having broken the US$1,000 genome sequencing barrier and the company aims to make costs much lower still. With NovaSeq, the most powerful sequencer Illumina has launched to date, the business seeks to show that a genome can be sequenced for US$100, cheaper than most x-rays.5 The sequencer launched in 2017 has already surpassed expectations and catapulted Illumina to record quarterly revenue in 2018.
Illumina’s other innovations include Grail, which aims to create a very early stage and universal cancer test, and Helix, a consumer genomics marketplace with a mission to democratise access to genetic sequencing.
Qiagen: a pioneering specialist
While Illumina is undoubtedly the NGS market giant, Qiagen has thrived by identifying niche markets, producing a broad range of instruments for whole-of-genome sequencing and expanding access to NGS for smaller diagnostic and clinical research segments.
The German company’s GeneReader solution, launched in 2015, focuses on oncology applications in these markets. Qiagen has also announced work in the analysis of hereditary disease and has applications in the pipeline ranging from prenatal testing to infectious-disease genotyping.
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2 ‘Unlocking the power of the genome’, by Samad, S. Presentation to the William Blair Growth stock conference on 13 June 2018.
3 ‘The cost of sequencing a human genome’, published by the National Human Genome Research Institute. Last updated 6 July 2016.
4 According to Illumina calculations in 2015.
5 ‘The secret genomic revolution’, by Gillian Tett. Published in FT Magazine on 17 March 2017.
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This is a sponsored article from Hermes Investment Management.
