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Helix, DNA Test Providers Discuss Challenges of App Marketplace Model


This article has been updated to clarify that Helix raised around $300 million in total.

NEW YORK (GenomeWeb) – Several providers of online DNA testing applications on Helix's genomics marketplace are disappointed that the Illumina-backed company was unable to generate broad consumer interest in their products, resulting in at least one app developer leaving the Helix platform while others are exploring alternative strategies for a national commercial channel.

Helix, headquartered in San Carlos, California, launched two years ago with $100 million in funding, and to much fanfare, proposing a new model for capturing consumers' interest in genetic testing. To date, ancestry has been the main growth driver in the consumer genomics market. But Helix bet that people would want to glean more from their DNA given the opportunity and a choice of products at the right price point. 

The company looked to create "an ecosystem" where consumers would pay to have their exomes sequenced once, and then buy tests, or apps, that analyzed different parts of this data in a variety of contexts – traits they may have inherited from Neanderthals, how their genes impact their sleep patterns, the chances of passing on a genetic disorder to their kids, or if they themselves are at increased risk for certain diseases. Importantly, they could come back to their data within the Helix marketplace throughout their lives and learn new things as their needs and interests changed.

After regulatory actions against direct-to-consumer genomics companies, such as Navigenics and 23andMe, sent the industry into a slump for several years, Helix's idea for an app marketplace seemed like an intriguing way to revive the market beyond ancestry testing. An impressive roster of executives, more than $300 million from sequencing company Illumina and other investment firms, and the chance for a national sales platform convinced many startups and established industry players that this new venture could be a disruptive force in consumer genomics, and they launched apps on the marketplace.

Executing on these plans proved far more challenging, however. Helix announced at the end of April that it was shifting its strategy to focus more on partnerships for population health research. Its main investor, Illumina, has parted ways with the startup. Former Illumina executive Marc Stapley has replaced Robin Thurston as CEO. And as reported by GenomeWeb earlier this week, the company recently laid off an undisclosed number of employees and decided to close its Denver and San Francisco offices. Helix declined further comment for this article.

In the aftermath of these announcements, leaders at several companies that were or are still providing apps in the Helix marketplace told GenomeWeb that the sales of their products didn't match their expectations.

"We had an interesting experience with Helix. There are challenges involved in any startup and in our case, we were a startup that was built on a startup," said Spencer Wells, CEO of Austin, Texas-based Insitome and a founder of National Geographic's Genographic Project. "There were challenges on both sides. But we certainly did not see the same level of traction that we saw when we launched [National Geographic's] Genographic tests."

Several companies, including Insitome, Exploragen, and HumanCode, were established and launched alongside Helix, specifically with the goal of accelerating the growth of its DNA testing marketplace. Insitome offers several ancestry DNA apps, Exploragen offered the SlumberType sleep patterns app, and HumanCode offered the BabyGlimpse app.

Insitome's apps are currently only available through the Helix marketplace, but Wells said that the company will explore other marketing channels and partnerships as it shifts to nonprofit status.

Helix last year acquired Denver startup HumanCode and hired its staff — for the Denver office that it has decided to now close — to manage the experience of Helix customers and product development partnerships. The original version of the BabyGlimpse app that Helix launched with tested for variants that couples may pass on to a child and claimed to predict what that child might look like. Helix no longer offers this app in its marketplace.  

Exploragen decided to remove its SlumberType product from the online marketplace at the beginning of the year due to lackluster sales. "It is true that reaching consumers with our entertainment applications has been a challenge," said Shannon Kieran, who used to be head of operations at Exploragen.

Kieran, who recently joined the executive team at genomics-focused tech start-up GenomeSmart, also cofounded Vinome, a company that selects wines for customers according to their DNA-based taste profile. Vinome continues to offer an app through Helix for the time being. "With Helix's public shift towards population health genomics, it is unclear to us at this time what the future will hold for apps like Vinome on the Helix marketplace," she said. 

What the experience of these partners suggest is that Helix, and the consumer genetics industry at large, hasn't been able to figure out how to drive consumer interest in genomics beyond ancestry testing. The Genographic kit was the first ancestry testing product that captured widespread consumer interest, selling 10,000 kits on the first day of launch in April 2005 and 100,000 kits by year end. "Suddenly, this industry was born," recalled Wells.

But since then, despite efforts to capture consumers' interest in other applications of genetic testing — to inspire healthy living, preventive care, or even just for entertainment — genealogy has remained the killer app. Wells estimated that roughly 30 million people, or 10 percent of the US population, have received genetic testing through consumer genomics companies, driven largely by their interest in ancestry. "What's been shown time and again ... is that the vast majority of people are driven by curiosity," he said. 

However, some industry players GenomeWeb spoke to said that genetic testing companies are wrong to expect that consumers will be curious in the same way about health-related genetic information. Gifting relatives a DNA kit to explore family roots can be a bonding experience around the holidays. Picking up on this, genealogy companies market heavily during the end of the year. Ancestry reported record sales during the 2018 Thanksgiving holiday, bringing the number of total kits sold to 14 million. Christmas gifts to assess one's risk for late-onset Alzheimer's risk, on the other hand, aren't quite as fun.

ADx Healthcare, a subsidiary of Northwest Pathology in Bellingham, Washington, offers a suite of molecular, anatomical, and surgical pathology services, as well as APOE tests for Alzheimer's risk that doctors can order. The company partnered with Helix in the hopes of expanding the market for its APOE test through a national sales channel but didn't see the uptake it had hoped for. The company still offers its test through Helix and will continue to market it to doctors in the Bellingham region but is exploring its options. 

"We know the value of a national channel but we haven't found that," said Jeff Chance, who leads business development efforts at ADx Healthcare. "So, we're in discussions to identify national channels. In the meantime, we will market [our tests] to clinics that see the value."

There is no cure for Alzheimer's, but there is some evidence that certain lifestyle changes, such as stopping smoking or losing weight, could potentially lower one's risk for developing the disease. ADx Healthcare reports customers' APOE results, provides a lifetime risk assessment based on their APOE genotype, age, and gender, and discusses the latest research on lifestyle changes associated with lowering the risk of dementia and improving brain health. The company has also developed a polygenic risk score for late-onset Alzheimer's that it will include in a report that also has results from blood-based tests, cognitive and medical history, and cognitive assessments.

But helping people understand their risk factors of Alzheimer's and make positive lifestyle changes takes more than merely developing an app for APOE testing and offering it online. "What everyone talks about in the genomics space is the killer app, and that's where I feel these consumer genetics companies are missing the mark," said Chance. "If you're going to look at it from a healthcare perspective, genomics is a tool for managing healthcare, and to just market it as a party trick is not going to be a sustainable business model."

Based on a number of conversations with industry insiders, however, it seems that for smaller companies relying on Helix as a national platform for their apps, the primary challenge was marketing. "There is a reason that [consumer genetics] companies like 23andMe and Ancestry spend hundreds of millions annually on advertising," said Kieran. "That type of marketing effort is simply insurmountable for companies the size of Vinome or Exploragen."

Helix did market through television ads, highlighting some of the information customers could learn, for example their sensitivity to caffeine or dairy. For some partners, they also created targeted advertising campaigns for specific products, and those campaigns did increase sales of those apps for a time. But some players suggested that blockbuster sales on the level of ancestry testing would require more marketing dollars.

"While we do not have the funds to engage in mega marketing efforts, we do believe that consumer uptake of our products on the Helix marketplace has been equivalent with the advertising efforts we have invested," said Kieran.

Another sticking point, cited by several sources — some of whom asked not to be named, citing disparagement clauses in their contracts with Helix — was the cost of acquiring the genomic data needed for interpretation within their app. Helix sequences customers' exomes, but partners have access to just the parts of the data they need to provide the interpretation for their test. Helix takes a portion of app sales based on the amount of genomic data partners need, which differs from product to product.

For some health-related apps, the portion of app sales that went to Helix could be significant, several sources said. And after paying for third-party physicians to review the test order and genetic counseling, some app partners weren't making much money, so this wasn't a viable business strategy for them.

Additionally, in reviewing the products launched on Helix's marketplace, GenomeWeb noted that Helix had developed its own app that in some instances compete with those of its customers. The Helix app, called DNA Discovery Kit, was initially intended to be a way to keep consumers updated on the status of their DNA analysis and interested in the process via trivia questions. But over time, Helix added to this app, including reporting genetic markers related to regional ancestry, body mass index, propensity for endurance in sports, and sleep patterns.

Some of Helix's partners are selling similar types of analysis, though, and Helix's DNA Discovery app, originally developed to entice customers to buy these other apps, has given them little motivation to do so. For example, there would be little incentive for a customer to pay more than $200 for a food sensitivities app from EverlyWell after paying $80 for Helix's DNA Discovery kit, which reports results on more limited but popular topics, such as gluten intolerance.

Meanwhile, for some app providers who are still figuring out their broader marketing strategy, there may still be value in providing products through Helix's marketplace. Helix takes care of sample collection, sequencing in a CLIA certified lab, provides a consumer-friendly website on which to sell the app, and has a secure portal for communicating reports — these are things that its partners don't have to worry about.

Moreover, newer partners, such as NorthShore University HealthSystem and PerkinElmer, are working with Helix as part of a broader strategy to integrate genomics into healthcare. Both said the company's decision to shift focus to population health partnerships will not change their decision to offer apps on the consumer marketplace. 

For example, NorthShore University HealthSystem has been selling a prostate cancer polygenic risk score through Helix for several months but the test is also available through doctors at the health system, serving patients in the Northern Chicago region, and through a partnership with Ambry Genetics. "The Helix platform is a different venue for people outside our system to potentially have access, because we've largely focused on having this information available for our patients," said Peter Hulick, medical director of the Mark R. Neaman Center for Personalized Medicine at NorthShore. 

Hulick wouldn't comment on whether the rate of adoption for the risk score has been higher when offered to patients within NorthShore or when offered through Helix. "There's always going to be a difference, no matter what the technology is, when you have your physician or your care team right in front of you ... and they're recommending a test," he said. "That has a pretty powerful connotation. It might be hard to replicate that through any other means."

At the same time, people outside the NorthShore system may not know about the polygenic risk score and Helix offers the health system a way to raise awareness of a relatively new type of test."There's always going to be ups and downs with adoption of a new technology and new information. But by engaging and having an offering through Helix, we're learning what it takes to bring something like that out to the marketplace," Hulick said. "That helps us understand the big picture, in terms of how to improve access [and] how to work with a team of health professionals to make this happen."

In April, PerkinElmer Genomics became the latest company to dip its toes into the consumer genomics space by launching the GenePrism app on the Helix marketplace. The app reports on whether customers have variants in 59 genes deemed actionable by the American College of Medical Genetics and Genomics. 

Although the partnership is still nascent, Madhuri Hegde, VP and CSO of PerkinElmer Genomics, said that PerkinElmer is receiving orders every week for the app. At the end of the second quarter, PerkinElmer will review the traction the app has gotten from the Helix marketplace and how consumers are responding to it.

PerkinElmer operates a number of labs in the US and around the world and provides a variety of clinical testing services for hereditary disorders, noninvasive prenatal screening, and clinical exome and genome sequencing. Hegde noted that while the GenePrism product is currently available only through Helix, patients who have gotten exome or whole-genome sequencing through PerkinElmer, and consent to learn if they have actionable variants in one of the 59 genes, will receive this in their test report. "Through exome and whole-genome testing, we're routinely reporting [ACMG-59 variants] anyway," she said.

Reflecting on Helix's strategic shift away from the consumer market to partnering with healthcare systems, Hegde noted that during her time working in genetics, she's witnessed a lot of changes in technology, price, access, and attitudes. Sanger sequencing has given way to next-generation sequencing, for example, and restrictive attitudes about when to give people information about genetic risk factors are changing as large population health projects aim to identify at risk populations earlier in order to prevent disease.

The consumer genomics market has seen its share of changes, too, since the first companies launched in the mid-to-late 2000s, hosting spit parties and making big proclamations about consumer empowerment, to the quiet years during the regulatory clamp down, and a boom period for the last few years driven by interest in ancestry testing.

A recent JP Morgan market report is projecting a slowdown in the consumer genomics market this year, though, driven by a saturation among those who are "genetically curious" in the US, limited utility of ancestry tests for non-Caucasians, and greater concerns around privacy, but the report notes there are opportunities for penetrating the health-related testing space in the future.

"It's not just about Helix. These kinds of products are going to keep coming on the market," said Hegde. She noted that while the consumer genetics market has grown, there has been too much focus on advertising and not enough efforts to truly educate consumers about genetics and the knowledge and uncertainties that comes with getting tested. "The focus has to be on education," she said, "if we want [efforts like] Helix to be successful."

Justin Petrone provided additional reporting for this article.