NantOmics, an individualized cancer treatment company that is a subsidiary of Patrick Soon-Shiong’s NantHealth, has invested $6 million in a new genetic sequencing startup, Genos.
The deal announced Nov. 7 was the first strategic investment for Genos, which was spun off in May from Complete Genomics, an established genetic sequencing company. NantOmics, which sequences patients’ DNA to create a treatment plan, itself has raised $250 million from NantHealth, the Culver City public company founded by Soon-Shiong, L.A.’s wealthiest resident.
Mark Blumling, Genos’ co-founder and chief executive, said he met Soon-Shiong through mutual friends. Soon-Shiong will join the San Francisco company’s board, Blumling said. However, Blumling wouldn’t provide the size of NantOmics’ stake in Genos, which has about 20 employees.
Blumling, 42, also founded Hyperion Therapeutics, an orphan disease drug company that was acquired for $1.1 billion last year.
Genos uses saliva from customers, gathered through a $399 kit, to decode their DNA, but with a new twist: It says it offers 50 times more data than other products on the market. Customers own all data provided by the company and through Genos can sell it for research.
Genos plans to offer third-party apps that will allow customers to analyze their data. The company is still in a beta stage, but has already tested almost 1,000 kits.
Genos is distinguishing itself from competitor 23andMe, another consumer genetic sequencing company, by providing information that could be used to diagnose potential health problems. Backed by Yuri Milner, a Russian venture capitalist, 23andMe also has taken an investment from GV, the venture capital arm of Google parent Alphabet Inc.
Anne Wojcicki, 23andMe’s co-founder and chief executive, said last month that her company wouldn’t pursue the next-generation gene sequencing, which requires Federal Drug Administration approval.
Genos’ focus on research complements NantOmics’ focus on treatment, said Blumling.
“The investment was driven by the fact that NantOmics is very much focused on using data to improve clinical outcomes for a wide variety of people,” said Blumling. “It’s a nice combination of interests.”
Genos could be an eventual acquisition target for Soon-Shiong, said Ahmed Enany, president and chief executive of the Southern California Biomedical Council, an industry association. He pointed to Soon-Shiong’s acquisition of Conkwest, a San Diego molecular cancer treatment company, last year, which was taken public under the name of NantKwest Inc.
“It opens the door for NantOmics to a lot of genetic info,” said Enany. “And if the business model flies, the investment is going to be worth a lot.”
NantOmics also acquired OncoPlex Diagnostics, a clinical laboratory that tests tumor cells for cancer, based in Rockville, Md., last year.
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