CHICAGO – Startup Nucleus Genomics said Thursday that it has closed a $14 million "seed-plus" funding round. Reddit Cofounder Alexis Ohanian's Seven Seven Six led the round, with participation from a series of mostly individual investors.
The New York-based genomics company simultaneously introduced a beta version of a consumer-facing genetic testing software platform that will underpin its strategy to create polygenic risk scores and give individuals control of their genetic data. Nucleus plans on offering whole-genome sequencing to the public in the future through laboratory partners.
The company previously raised a $3.5 million seed round late last year, led by Founders Fund, and emerged from stealth mode in December.
When it was prospecting for the seed-plus round in early 2022, Nucleus was betting on potential global economic turmoil.
"We strategically fundraised at the beginning of the year because we saw a bear market was coming," Chief Operations Officer Caio Hachem said. Indeed, the S&P 500 stock index recently entered bear territory, defined as being down at least 20 percent from its peak.
Now, as some technology companies are laying off software engineers as costs rise and sales stagnate, Nucleus is "actively targeting" such firms to try to scoop up that talent, according to Hachem, who met Founder and CEO Kian Sadeghi at the University of Pennsylvania and later became the company's first employee. The firm is also hiring geneticists and computational biologists.
The firm aims to address the widely documented lack of diversity in genomic datasets that has hindered research on nonwhite populations, and wants to lead by example by building a diverse team. Sadeghi is a first-generation Persian American whose parents escaped the 1979 Iranian Revolution, while Hachem is a native of Brazil.
Nucleus wants to be able to ship DNA collection kits to Latin American and Asian countries. Lab partners will help the company work through regulatory and logistical issues, but Nucleus will be hiring science writers to make sure not only that support material is written in lay language but also addresses cultural norms and customs of people from different backgrounds, according to Hachem.
Sadeghi described Nucleus as a "consumer genetic testing company that's building a sequencing-first platform" using WGS. He noted that large direct-to-consumer sequencing firms like 23andMe and Ancestry still focus on microarrays, a technology that Sadeghi said would become "archaic" over the next several years.
Nucleus will deliver polygenic risk scores and rare-variant analysis from its WGS tests. Users who have taken microarray tests from other DTC genetic testing services can now upload their results for Nucleus to perform analysis on those smaller datasets; indeed, Sadeghi said that the platform will support any FASTQ or VCF file.
The company's mission and ultimate goal is to have a personally controlled human genome on every smartphone, complemented with health profiles created by centralizing and combining phenotypic, social, and lifestyle data. Nucleus Genomics is promising customers "total autonomy" over their genetic data.
"We see it not as a hypothesis, but as an imminent inevitability that every single person in this country and around the world … has this entire human genome on their smartphone," Sadeghi said.
As with so many healthcare startups, the Nucleus story is rooted in personal tragedy: Sadeghi's cousin died in her sleep at a young age of a heart attack linked to a rare genetic condition called long QT syndrome.
"I remember asking my parents, how is it even possible?" Sadeghi recalled, noting that he grew scared of going to sleep at night. "My parents said to me, 'It's bad genetics, it's bad genetics.' And I was like, what does that mean?"
He thus developed an interest in genetics and joined a "do-it-yourself" DNA lab in high school where aspiring scientists could perform simple tasks like illuminating DNA with yeast and engineering bacteria. "I realized that disease isn't really an inherent property of human beings, but can be viewed more of a problem to be solved," Sadeghi said.
"Eventually, I started thinking about what if you could combine this kind of depth of biology with the malleability of computer science and operate at this beautiful intersection of bits and atoms," he said. Sadeghi thus went to the University of Pennsylvania to study computational biology.
During the early days of the COVID-19 pandemic, Sadeghi wanted to analyze his own DNA and realized that he could provide more analysis on more diseases and traits by combining polygenic risk scores and rare-variant analysis from whole-genome sequences. He also noted the exponential decline in the cost of WGS.
Startup Ultima Genomics recently announced plans to offer a $100 human whole-genome sequence through a novel sequencing-by-synthesis method as early as next year, but details remain scant.
Sadeghi said that the Ultima breakthrough will unleash a "race to the bottom" in pricing of consumer WGS services. "In that race to the bottom, there's going to be this rapid proliferation of genome data," requiring user-friendly applications to help people understand both their DNA and other health information, he said. "You can build a health profile of everyone in this country with all genome data at the foundation of that."
However, direct-to-consumer WGS has been a difficult proposition to date. Notably, Veritas Genetics, which had offered sequencing and interpretation for as little as $399, shut down its US operations in 2019.
Veritas restructured and reopened in 2020 before being acquired by LetsGetChecked this year. LetsGetChecked said it would launch a WGS service before year-end, but has not offered any pricing details.
Nucleus is building a network of clinicians that will be able to offer telephone and telemedicine consultations with customers to help individuals understand their results. Like the analysis platform itself, that feature is currently in beta testing.
The company will not announce its pricing until the launch nears later this year, Sadeghi said.
The firm is also working on a professional version of its risk reports that customers can take to their own doctors. One issue with personal health records is that they do not fit neatly into clinician workflows, and medical professionals may not trust patient-supplied data. Sadeghi did not explain how Nucleus might overcome this formidable hurdle other than by saying that the firm would offer higher-quality data than microarray-based genotyping firms provide.
The company has ambitious plans to make the Nucleus platform a hub for people to manage all their health data, not just genotypes and polygenic risk scores. This includes physician notes, nonmolecular lab test results, and health and fitness data from wearable devices.
"Healthcare data is very much so decentralized," Sadeghi noted. "How can we build … a kind of personalized health platform with whole-genome sequencing data at the foundation and then start integrating other information to build a best-in-class consumer health experience? That, I think, is the ultimate ambition."
It is also a path littered with failure.
These patient-controlled data stores, often called personal health records (PHRs), have been a tough sell for a long time. Various forms of PHRs have been around for more than a quarter century, but not a single PHR brand has gained wide acceptance unless it is tightly linked to an institution's electronic health record. Among those disappearing were widely hyped offerings from tech heavyweights like Google and Microsoft.
Sadeghi said that Nucleus is prepared to play the long game. "It's going to take some time until [a consumer WGS] actually is $100," he said. "We're definitely building this … for the next 10 years, but not the next six months or even a year."