Every January, investors, innovators, and entrepreneurs convene in San Francisco for one of the most respected healthcare finance conferences in the world, hosted by JP Morgan. This year, the conference had approximately 8,500 attendees and as usual, lived up to expectations. Senior executives presented their financial outlook for 2012, while investors and companies alike searched for possible partnerships and funding opportunities to support the development of the newest treatments, diagnostics, and other healthcare products.
There’s always one or two show-stopping announcements at the conference. This year, two competitors in the genome sequencing field blew attendees away. Since the completion of the Human Genome Project more than a decade ago, we’ve been hearing that the $1,000 genome will revolutionize healthcare and help speed the integration of genomics into the clinic. A few years ago, a full genome sequence cost more than $300,000 and took months to complete. Today, sequencing companies can analyze a sample for about $5,000 and turn around results in just over a week.
Last week, only a few hours apart, Life Technologies, Inc. and Illumina, Inc. both announced new products that offer full genome sequencing in less than one day at $1000 per sample! The entire conference was abuzz with excitement over the possibility that the newest generation of sequencing technology will become a reality in 2012. The main difference between the two machines will be the upfront costs—Life Technologies’ machine costs $150,000 and Illumina’s sequencer costs $740,000. Initial reactions from the investor community were positive, with some pointing to the current economic climate and the potential of reduced funding at the National Institutes of Health (NIH) likely making Life Technologies’ product more attractive.
But let’s not forget about the third horse in the sequencing race: the Archon Genomic X Prize will award $10 million to the first team to rapidly, accurately and economically sequence 100 whole human genomes to an unprecedented level of accuracy. Even after last week’s announcements, many experts believe the machine capable of reaching this level of accuracy still doesn’t exist. Who will you bet on?
JP Morgan hosted two fireside chats with senior administration officials – NIH Director Dr. Francis Collins and Dr. Jeff Shuren, head of the Food and Drug Administration’s (FDA) Center for Devices and Radiological Health. Dr. Collins highlighted NIH’s growing focus on translational medicine, with the NIH’s greatest effort in this realm being the creation of the National Center for Advancing Translational Sciences which received funding this year, while expressing concern over future funding levels for all of NIH and said that the NIH is considering alternative ways to cut spending, including limiting the amount of awards to the most successful grantees (i.e. a threshold) and focusing funding on cutting edge science.
During Dr. Shuren’s session, he acknowledged that there are many concerns with the 510(k) review process for medical devices, including a lack of predictability and consistency due to issues such as insufficient management oversight and a high employee turnover rate. As a result of a 2011 internal assessment, the Center implemented a plan of action to address those problems and published several draft guidance documents intended to shed light on the review process. The FDA hopes to finalize many of those guidance documents in 2012. Dr. Shuren also spoke of a new innovation pathway to shorten the review time for innovative technologies that they hope to announce in March. Last, he said they need resources to address staffing needs, create new training programs for staff and to continue to improve the regulatory process for devices.
It’s uncommon for senior agency officials to interact so directly with investors, but clearly both Dr. Collins and Dr. Shuren benefited from hearing from conference attendees. This was a great opportunity to continue to build public-private partnerships with the healthcare industry to spur innovation and hopefully, we’ll see these two sectors interact even more in the future.