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23andMe to 'Experiment' with Different Price Models in 2011


Originally published Jan. 3.

By Turna Ray

In 2011, direct-to-consumer genomics firm 23andMe will test different pricing models to determine the sweet spot for would-be customers who have been hindered by the high cost of the service.

"We plan to experiment with various pricing structures a bit in the coming weeks or months," Catherine Afarian, 23andMe public relations manager, told PGx Reporter recently. "We know that our price point has been a barrier for some people in the past. We are testing different pricing structures to better understand how to make our service more widely accessible and allow us to continue the work we are doing."

23andMe launched its DTC genomics service in 2007 with a price tag of $999 for its Personal Genome Service, which includes analysis of customers' genetic predisposition to diseases, response to drugs, and genetic ancestry. In the three years it has been in operation, 23andMe has changed its pricing structure several times. In the fall, the company announced that it would charge $499 for its full range of genomics analysis services plus a $5 per month subscription fee after a year (PGx Reporter 11/24/10).

As of this week, the price for the Personal Genome Service is $199 plus the $5 per month subscription fee. The service is also available for $499 without the monthly subscription.

The latest drop in price follows a $99 sale that 23andMe offered during the 2010 holiday season — one of several such sale periods that the company has hosted in an effort to net new customers.

In the coming year, 23andMe will remain flexible with its price structure in order to figure out what customers are most comfortable paying. "We will likely experiment with the subscription requirement (currently a 12 month minimum and then … month-to-month)," Afarian said in an e-mail. "We may shorten the minimum requirement or remove it altogether."

23andMe will also consider different price points for the initial fee. "We'll make adjustments as we gather more data," Afarian added.

Currently, 23andMe estimates that it has more than 60,000 customers. The company would not reveal its customer enrollment targets for 2011.

23andMe also declined to elaborate on whether the greater barrier for potential customers is the early state of the science or the price of its service. Over the past year, DTC genomics firms have been blasted by the US Food and Drug Administration and in the US Congress for selling preliminary and evolving scientific advances directly to the public (PGx Reporter 07/28/10).

However, in an effort to increase the body of knowledge about the role of genomics in disease risk prediction and drug response, 23andMe has recently increased research efforts and expanded customers' ability to opt out of research projects (PGx Reporter 12/22/10).

In light of recent regulatory scrutiny, 23andMe is among the few firms in the sector continuing to survive solely on the DTC business model, though its main competitors DeCode Genetics and Navigenics are also experimenting with different pricing and service models.

Decode Genetics' DecodeMe DTC service can still be ordered by customers online, but at a significant premium to 23andMe's service. DecodeMe's CompleteScan, which provides ancestry and genetic risk for various diseases with research updates, costs $2,000. The company also sells separately priced, cheaper gene scans for the risk of particular conditions or diseases, such as glaucoma, atrial fibrillation, and type 2 diabetes, as well as pharmacogenetic tests. In its web descriptions for each product, Decode notes which tests are most likely to be reimbursed by insurance companies.

Navigenics, meanwhile, has moved away from the DTC model and does not list the price of its service on its website, which states that genetic analysis services are "available through physicians and corporate wellness programs, and pricing may vary."

Pathway Genomics — the first DTC genomics company to be warned last year by the FDA when it tried to sell its saliva collection kits through Walgreens and CVS stores — now also requires the consent of an US-licensed physician to purchase one of its kits. The company offers separate packaged kits for drug response, health conditions, diet and nutrition, pre-pregnancy planning, or one complete package including all of these services. The company does not disclose pricing for these services online.

Have topics you'd like to see covered in Pharmacogenomics Reporter? Contact the editor at tray [at] genomeweb [.] com.

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