Is deCODEme Taking a Page from the 23andMe Playbook?

playbookDaniel MacArthur of Genetic Future provides coverage of the decision by direct-to-consumer (DTC) genomics service provider deCODEme to offer existing 23andMe customers the ability to upload their raw 23andMe data to the deCODEme service. For free.

MacArthur correctly notes that the value of the genome scans provided by companies such as 23andMe and deCODEme lies not in the actual creation of raw genetic data but in the interpretation of that data, and wonders why deCODEme has decided to give that away for free. Here’s MacArthur’s take:

So, why the free offer? I’m guessing deCODEme is gambling (quite reasonably) that offering free uploads will attract a non-trivial number of 23andMe customers over to deCODEme’s interface. That then provides the Icelanders with an opportunity to give people a fair trial of their own interface, and hopefully to impress them with the quality and accessibility of the data provided.

That seems reasonable, and many 23andMe customers are likely already familiar with porting their raw genetic data to other interpretive tools – Promethease, for example – so perhaps this puts deCODE in front of a group of individuals who would not otherwise be in the market for a duplicative genome scan. (23andMe appears unconcerned by the prospect of a side-by-side comparison of its service with that of deCODEme.)

What’s more, MacArthur argues – like so many others, including the GLR – that generating and interpreting genotype data is “really just a transient place-holder for the real deal: interpretation of complete genome sequences.” That’s certainly true – why order up a million or two SNPs when you can have your entire genome sequenced for a comparable price? But despite some predictions that low-cost whole-genome sequencing will arrive as early as 2010, it’s not here today, and deCODE is unlikely to offer it at mass consumption prices in the immediate future. So how, exactly, does this move provide a near-term boost to a business whose parent entity, deCODE genetics, Inc., recently declared bankruptcy?

One possibility is that deCODEme, in addition to targeting 23andMe’s customers directly, is taking another page out the 23andMe playbook. I’ve written previously (here and here) about 23andMe’s creative attempts to pursue a DTC genomic research model. Simply put, as the cost of genomic sequencing continues to fall, the next generation of human genomics research will continue to strive to elucidate the genetic and environmental causes of complex traits such as heart disease and cancer. Doing so will require increasingly large and integrated datasets that combine detailed genomic information with individual trait, medical and environmental data. 23andMe, along with other companies such as PatientsLikeMe, has been at the forefront of efforts to tap into the DTC genomics customer population in an attempt to populate those datasets.

Whether developing DTC genomic research databases will prove to be a commercial success remains to be seen, but one of the initial problems that 23andMe has run into has been its inability to attract enough DTC genomic research participants to produce a full-scale Research Revolution. While there is no overt indication that deCODEme is itself moving in the direction of DTC genomic research – its announcement to existing 23andMe customers contains no hints about its motivation for providing the service – the option is on the table. The company’s Service Agreement and Informed Consent notes that deCODE may contact users and “invite [them] to participate in research.” And if deCODE was looking to develop a DTC genomic research database, there’s no better price point from which to do so than “free.”

TruGenetics announced something similar over the summer, and promptly ran into fundraising difficulties. But not only is deCODEme an established service, it is actively dealing with financial woes of its own and, as MacArthur emphasizes, facing “massive pressure” to demonstrate “commercial success from [its] personal genomics offering; and that means finding some way of going head-to-head with the well-funded and Google-backed 23andMe.”

Until the company lets us in on its plans, there is no way to know whether deCODE’s announcement represents an attempt to showcase its service to more potential customers, an indication that it plans to enter the DTC genomic research fray, or something else entirely. But no matter what this means for deCODE in the short-term, I think this is an intriguing and forward-looking move by the company. As sequencing costs continue to fall, genomic data generation is becoming cheaper and easier. But the same is not necessarily true of genomic data interpretation, as companies struggle to keep up with an expanding genomics knowledgebase.

If interpretation proves to be one of the key differentiators between DTC genomics companies, as expected, deCODE (and other companies) should embrace opportunities to hone their interpretative platforms now, while the DTC commercial market remains relatively small. A recent report from PricewaterhouseCoopers (pdf) estimated “the size of the global market for genetic testing at $730 million, with a 20% annual growth rate” and predicted that DTC genetic testing would “grow rapidly in response to consumer demands and declining prices.” Its recent financial struggles suggest that if deCODE is to participate in that projected growth, and continue to remain a relevant player in the DTC genomics space, it has little choice but to innovate. And offering its service for free to customers of its main competitor is certainly an innovative approach.

As the calendar flips over to 2010 it will be interesting to see what other strategies 23andMe, deCODEme and other DTC players employ in their attempts to stand out in the increasingly competitive consumer genomics marketplace.