REDWOOD CITY, Calif., March 22 - Incyte Genomics co-founder Randy Scott and his latest creation, Genomic Health, are in stealth mode.
Though Scott launched the new applied genomics/personalized medicine enterprise in August 2000, the products and services portion of its website urges visitors to "Please re-visit the site for further progress with our clinical development program."
Scott himself is circumspect about what is under the company's hood, choosing instead to talk in generalities with a GenomeWeb reporter during a recent interview at the firm's headquarters here.
"Our driving force here is to begin to try and link clinical medicine with genomic information," Scott hinted. "Just saying Here's X-number of genes in the genome' doesn't get you very far. What I need to understand is how genetic information correlates with disease."
When asked what's beyond a conference room's walls, he said, with a smile, "wet labs, computers, and people. They're all here."
While Scott prefers to hold off on talking about his new company until there are products to discuss rather than just plans, as he put it, he isn't shy about looking into the future of the wider arena of the genomics industry.
GenomeWeb: What type of investment environment is the industry experiencing?
Randy Scott: In general I think it is a valley. Many industries just go in cycles. You're in favor and then you're out of favor. It's probably too high when it was high and it's probably too low now that it's low.
For me, starting Genomic Health was really just the culmination of where I've always wanted to go, which was taking genomic information and being able to link it to real-world patients and real-world medicine. That's ultimately what we have to do as an industry, to apply this information to solving patient problems. I've always been excited about that, and just felt the technologies were reaching maturity at a pace to allow us very soon to start delivering much more genomic information to patients and physicians.
GW: Is the genomics industry at a turning point?
RS: We really are at the transition period. As I look back, there have been a couple of big waves so far in genomic technology. The first was the whole Genentech era of recombinant DNA and gene splicing, the very origins of biotechnology. It was genomics as a basic science.
The whole 90s was the industrialization of biotech which became the genomics industry. It was really the first time anybody used the term industry, the idea that you could do high throughput DNA sequencing and scanning thousands of genes at a time. It really turned it into an industrial process.
The first wave was novel science, everything was painstaking, one gene at a time. At Genentech the whole philosophy was clone or die. People who were held up as the stars were the ones who cloned a single gene, and that was big, that was a major publication. And all of a sudden in the 90s it was the age of papers that had 72 authors. It moved from science to a more thorough industrial piece.
I think the pause that we're seeing now is that people kind of reached a limitation of the industrial piece, which is 'Now we can scan thousands of genes at a time, we can do these mega projects.' But there's a gap between that information and really tying it to clinical data about real patients with real disease. I think that's what the coming decade is really going to be about, taking genomic technologies and tying it to patients.
GW: In the personalized medicine space, what kind of products will emerge?
RS: The whole world of genomics is opening up to the very simple fact that every one of us is different, and we're going to respond to diseases differently, we'll respond to drugs differently. Right now industry treats disease instead of treating people.
I think the big personalized medicine push is that simple, It's the trend away from treating disease to treating people. Matching patients to the right drugs and right therapies, and accurately defining patient diseases. To define disease on a molecular basis and not a series of symptoms that can be thrown together and lump everybody [together].
GW: What type of genomic tools do you see contributing to that goal?
RS: I'm a big fan of the holistic biology [of] DNA, RNA, protein--all three. [And] SNP analysis, DNA-expression profiling, and proteomics. All three technologies are going to have a big impact.
What's unique about genomics is the ability to scan large numbers of genes simultaneously. So instead of having just a single protein assay for a disease, the ability to be able to look at a patient and profile a complete genetic makeup. [To do] expression profiling, and [analyze] at the protein level what's happening and being able to connect that back to drug development.
GW: Do you see the market for genomics, proteomics, and bioinformatics rising?
RS: I think there's a lot of underlying value in all of the technologies. I don't see any problems in terms of the long-term value of the types of data that people are generating. So I think we're in a valley right now where the biotech market is out of favor but we also just came through one of the biggest stock market booms and crashes in history and almost everything long term is out of favor.
People are back to fundamentals. Show me growth in profits and earnings, and we're in the very early stages of the biotech industry. For me it's not so much what's the next hot thing, it's just the industry needs to keep doing what it's doing, which is using the technology to get a better basic understanding of disease and then connecting that to the market place to connect with physicians and patients to say how that understanding will help us, whether it's a new target for drug development or a new diagnostic assay or genetic test. I think you're just going to see a slow building over time.
The market place will go in cycles. The stock market is down now. I would be shocked if in the next two years we don't have another big biotech boom.
GW: What are technological hurdles to get over to reach the promise of personalized medicine?
RS: I see most of the technical hurdles fallen. I think it really is economically driven. So I believe we are at this very early stage of the industry in which we can do genetic studies, they're just very expensive. We can do gene-expression profiling, it's just expensive. We can do proteomic analysis. It's a little bit behind the other two [and] it's especially expensive. I think the only hurdle is cost.
So I don't see one massive technical hurdle as much as just a maturing of an industry. We are where the computer industry was in 1980: You could buy a computer but it couldn't do very much. Twenty years later you buy a computer and it is incredibly powerful and you have lots of great software and applications for it.
One of the great topics right now is time frame. We seem to be in a lull in genomics where the stock market has pulled back, a lot of people are looking at the technology and saying either it is ahead of it's time or it's not providing good value. Companies are struggling to get deals done, and get what they consider the right valuations. One of the great debates is how fast is the technology going to move going forward. Are we talking about five years to really be able to transform medicine or are we talking about 20 years?
GW: What do you think?
RS: I'm betting more on five years. We see several forces coming together. One is the industrialization of genomics has resulted in more and more resources. Cheaper access to SNP assays and expression profiling, proteomic data. And I think the next five years is going to be when it will really begin to translate that into clinical research and clinical medicine. Once we begin to see that I think the world at large will start to realize the inherent value of genomic technology.
Just like we saw the biotech gold rush a few years ago, I think sometime in the next five or six years we'll see another gold rush where people realize translating genomic information in clinical medicine will have a huge impact.
We spend a trillion dollars in health care just in the US, and out of that trillion dollars only about 10 percent is actually spent on drugs trying to effect disease. The rest is just on management of patients and care. Today, only about a billion dollars is spent on any kind of genetic or gene-based testing. Out of a trillion-dollar health-care budget we're spending a tenth of a percent on any kind of molecular profiling of the individuals. I think that's a dramatic change that will start to take place and I'm a big believer that better spending on genomic information can make a huge dent in the way we spend our overall health-care dollars.
GW: Using those figures, going from the one billion out of a trillion to even just doubling or tripling that number, seems to bode well for genomics tool companies.
RS: I would absolutely agree. Over the next five to 10 years, almost everybody in the field is predicting that the growth in genomic testing and genomic information in the clinical marketplace is going to be on the order of 30 to 50 percent a year. So we can expect that billion dollars to grow to somewhere between five to 10 billion dollars over the next decade.
GW: Do you see that money filtering down to the genomics tool companies?
RS: Absolutely. That's why I'm a long term bull for the field. And I am concerned that people are panicking, just not having the staying power, getting worried about their business model.
A lot of platform companies are moving off in other directions when in fact like any early industry it will have its ups and downs. But staying power is the key to success. I see more people in the financial community today talk about platform companies, information companies, as though it is a dead business model. In fact I don't think that's correct at all.