Pacific Biosciences, one of the companies working to advance DNA sequencing technology, just brought in $68 million in new financing — bringing its total raised over the last year to a staggering $188 million. The Menlo Park, Calif., firm says it plans to use the money to prepare its new real-time sequencing system for commercial launch in 2010.
Its ability to raise such a substantial amount of money is significant for several reasons. Not only is it indicative of the growing momentum in life science investing (which had tapered following the economic downturn), it’s also a surprisingly large sum for a company operating in a space where the technology is evolving faster and more inexpensively. At the extreme end of this spectrum, Stanford University bioengineering professor Stephen Quake just announced that he mapped his entire genome in one week for a mere $48,000 using a Helicos Biosciences machine that would only cost $1 million to buy. (By contrast, the Human Genome Project took 13 years and spent $300 million to do roughly the same thing.) Granted, some have criticized Quake’s methods for only capturing 95 percent of the DNA data — but it’s still an impressive feat.
And perhaps a worrying one for larger companies like Pacific Biosciences, which are now feeling the pressure of up-and-comers innovating their way into cheaper, rapid-response technology. It certainly seems like its new real-time sequencing efforts feed into this vein. Of course, Pacific is operating at a much larger scale, with the potential to change the way doctors deliver personalized medicine. If fast, cheap technology can be made available to regular physicians, and they are able to sequence their own patients’ DNA in-office, there could be a massive shift toward preventative medicine, lowering health care costs and upping quality of treatment. On top of that, Pacific says it has adopted a tighter focus on the ways in which inheritance and environmental factors impact people’s genetic health — two factors that could inform patients’ medical histories and alter the way they seek medical attention.
Some of these ideas have already been popularized by companies like 23andMe and Navigenics, which sequence DNA samples provided by regular people interested in mapping their genes and detecting genetic conditions early. A similar company, Illumina, provides kits for genetic research, but is also competing more directly with Pacific in developing next-generation sequencing technologies. As ScienceBlogs pointed out, Pacific will need to produce innovation that goes way beyond current capabilities in order to become the market leader in this area.
Pacific’s recent round of funding came from new investors Wellcome Trust, Monsanto and Sutter Hill Ventures. Current and past backers include Morgan Stanley, Deerfield Capital Management, Intel Capital, Redmile Group, T. Rowe Price, Mohr Davidow Ventures, Kleiner Perkins Caufield & Byers, Alloy Ventures, Maverick Capital, AllianceBernstein, DAG Ventures, Teachers’ Private Capital, and Blackstone Cleantech Venture Partners.