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Startup Pledges To Cut Cost Of Breast Cancer Genetic Testing From $4000 To $249

This article is more than 9 years old.

This morning, a Burlingame, Calif.-based startup called Color Genomics is announcing that it will provided genetic testing for breast and ovarian cancer – the same genetic tests that led Angelina Jolie to have her breasts and ovaries surgically removed – at one-sixteenth the cost of the main test that is currently used.

“We want to be able to democratize access,” says Color’s chief executive, Elad Gil. “We want to be able to broaden access to this kind of testing because it is very important for women to able to understand their risk and work with their health care provider to create a plan around that.”

The company has raised $15 million from venture capital firms Khosla Ventures and Formation 8, as well as a group of private investors that include Laurene Powell Jobs, widow of Apple Inc. co-founder Steve Jobs, Rockefeller University President Marc Tessier-Lavigne, and BlackRock co-founder Susan Wagner.

“There’s no way Elad could have known this,” says Wagner, “but as it turns out my mom is an ovarian cancer survivor, somewhat of a miraculous survivor.  I understand the relevance of the genetic testing and I also understand the challenges in getting insurance coverage for doing that genetic testing.  And it really just immediately resonated that their goal was to bring down the cost of that testing by something like 10 times to democratize access to it.”

For years, the main seller of these genetic tests, for genes including the BRCA1 and BRCA2 genes, has been Myriad Genetics of Salt Lake City, Utah. It charges about $4,000 for its most expensive test. But in 2013, Myriad lost a Supreme Court case related to its patents on the genes, which has allowed other companies to do the same kind of testing for much less. Companies like Ambry Genetics, Quest Diagnostics, and In Vitae, have introduced cheaper versions of the test, dropping the price by about 75%, in part because new genetic sequencing technology from Illumina has rapidly dropped the cost of doing genetic testing.

But that still wasn’t low enough for Color. The company says it has introduced new levels of automation to the process of genetic testing, but that it is also willing to sacrifice margin in order to get the test to women who could not otherwise afford it. Gil points out that in one study in the journal Science, 10% of women with breast cancer had the BRCA mutations, but only half of them had the family history of breast cancer that would have led health insurance companies to pay for the test. Gil thinks they should be able to get their results.

At first, Color will not interface with health insurers at all, billing its tests directly to patients, which it says will  further reduce costs. Doctors will need to order the test online.

Gil has a Ph.D. in biology from MIT, and worked on a cancer gene called PTEN. But then he decided he needed to work in software, and begged his way into a job at Google.  “I thought that software was the future. It seemed like it was going to transform biology.”

At Google, he worked on Android and then on Gmail. Then he started a company with one of his Color co-founders, Othman Laraki, that was bought by Twitter. But both of Gil and Laraki wanted to take their technology skills and move into biology. “We really started feeling that the future of genetics in many ways is going to be a data problem,” Laraki says.

Are these data geeks really ready for the world of medical testing? Some big-name scientific collaborators say yes. One is Mary Claire King, who pioneered the study of the BRCA genes and has bristled at the high price of the tests. Another is Laura Esserman, director of the Carol Franc Buck Breast Care Center at the University of California, San Francisco.

Esserman says that she thinks Color could change the world of breast cancer genetics. “It becomes cheap and easy to know,” she says. “The more common and public the more we can understand it. The more we push it underground, the less we’ll understand it. It doesn’t have to be a secret.”

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