Houston-based Gene by Gene, Ltd., a leading DNA testing company that pioneered consumer-accessbile DNA testing products for ancestry and genealogy applications, recently made a surprise acquisition, purchasing Austin’s Arpeggi, Inc. in an entirely Texas-based move to help further establish Gene By Gene as a true worldwide leader in affordable, accessible DNA testing.
BioNews Texas has widely covered both companies in recent months, with Gene By Gene being a beneficiary of the landmark U.S. Supreme Court ruling over Myriad Genetics’ previous patent claim on BRCA breast cancer DNA testing, making it free and accessible to competing companies like Gene By Gene, who can in turn offer lower prices to consumers. Additionally, Arpeggi’s promising profile as GE-backed start-up on the bleeding edge of developing solutions for genome sequencing, data management and computational analysis, made headlines on news that the company was among 13 consumer health companies selected for the GE healthymagination healthcare investing arm of GE Ventures, and StartUp Health.
Unity Stoakes, cofounder and President of StartUp Health, said of the news: “We are thrilled by the acquisition of Arpeggi and excited to continue to help Gene by Gene on its mission to lead the rapidly advancing genetics testing and sequencing market. This acquisition represents a significant combination of technologies, expertise and infrastructure that we believe will make an important impact on the future of the genomics sector and how many people have access to these innovations.”
Similarly, Rafael Torres, Senior Managing Director, GE Ventures-Healthcare said, “The deluge of data generated from genomic testing and the ability to store, analyze and interpret it efficiently has been a bottleneck for organizations focused on large scale sequencing. Arpeggi’s solution provides an infrastructure that helps human genomic and bioinformatics companies get the most out of their data. We’re proud to have Arpeggi involved with our Entrepreneurship Program with StartUp Health and cannot wait to see them further advance DNA testing through the marriage of science and technology.”
In a recent press release to the media, Gene By Gene acknowledged the short- and long-term benefits of the acquisition, which is designed to accelerate the development of an innovative suite of cDNA tests and diagnostics services that are price-friendly for consumers and designed to help make access to DNA test and results truly mainstream.
“The acquisition of Arpeggi’s technology and world-class team of data and technology experts will enable us to accelerate Gene by Gene’s plan to make next-generation DNA sequencing and clinical genomics accessible and affordable to all,” said Max Blankfeld, Managing Partner of Gene by Gene. “We are on a mission to transform healthcare by dramatically speeding up the process, and reducing the costs, of genetic tests, which today are often far too expensive for the average consumer.”
BioNews Texas reached out to David Mittelman, Ph.D., co-founder of Arpeggi Inc. and now Chief Scientific Officer for Gene By Gene, for a few exclusive comments on specifically what the acquisition will mean for the company — as well as the founding members of Arpeggi — who will all continue their critical work under the Gene By Gene umbrella:
BNTX: Where or how specifically does Gene by Gene see Arpeggi fitting in to their service offerings?
Mittelman: We originally thought about working together in a customer or partner relationship. It became immediately clear, however, that the value of Arpeggi + Gene by Gene could be greater than the sum of its parts. One way to think about it is the difference between being a software or hardware company; versus controlling the stack (like Apple) and optimizing the entire experience.
So I think genomics is at the stage of the PC industry about 20 years ago, when the market was fragmented. We want to be part of future landscape of genomics where people offer vertical solutions in which a sample comes in, and genetic information comes out. Merging gives us the chance to do this.
BNTX: What does it mean for two Texas-based biotech-oriented companies to come together through an acquisition like this? What does that say, if anything, about the biotech sector in Texas?
Mittelman: I love Texas. I worked on the Human Genome Project at UT Southwestern in Dallas. I went to graduate school at Baylor College of Medicine and later I trained at the Human Genome Center at BCM under the direction of Dr. Richard Gibbs. Particularly in Houston, we have an amazing medical center, one of the best research medical schools in the world and so much innovation and technology. There is a gold mine of opportunity here and there have already been some great successes here. We are all excited to contribute to this biotech growth and are looking forward to working with the local medical center and research community!
Unlike some acquisitions, which often cannibalize executive staff and subsume assets only, this acquisition will allow the Arpeggi team to remain engaged in their work, bringing it in line with Gene By Gene’s proven commercialization prowess. The press release also stipulates that, “Arpeggi’s founders will join Gene by Gene’s management team, effective immediately.” In addition to Arpeggi CEO, Mr. Nir Leibovich being named Gene by Gene’s Chief Business Officer, Jason Wang was named Chief Technology Officer and David Mittelman, Ph.D was named Chief Scientific Officer.
Gene by Gene’s Doron Behar, M.D., Ph.D. was also named Chief Medical Officer. Gene by Gene’s Blankfeld and Bennett Greenspan continue to serve as the company’s Managing Partners.
About The Arpeggi Team
Founded in 2012, Arpeggi develops solutions for genome sequencing, data management and computational analysis. In April, the company released GCAT Genome Comparison and Analytic Testing, a free community driven platform for evaluating the performance of next-generation sequencing (NGS) data analysis methods. The platform has gained tremendous traction and was recently showcased at BioIT World and the Clinical Genome Conference. Arpeggi has developed proprietary sequencing tools, designed for scale, that enable accurate, fast, and cost-effective analysis of genomes. This year, Arpeggi was selected as one of 14 startups, out of 400 applicants, to join the StartUp Health and GE Entrepreneurship Program to help grow, commercialize and scale new innovative healthcare technologies.
About Gene by Gene Ltd.
Founded in 2000, Gene By Gene, Ltd. provides reliable DNA testing to a wide range of consumer and institutional customers through its four divisions focusing on ancestry, health, research and paternity. Gene By Gene provides DNA tests through its Family Tree DNA division, which pioneered the concept of direct-to-consumer testing in the field of genetic genealogy more than a decade ago. Gene by Gene is CLIA registered and through its clinical-health division DNA Traits offers regulated diagnostic tests. DNA DTC is the Research Use Only (RUO) division serving both direct-to-consumer and institutional clients worldwide. Gene By Gene offers AABB certified relationship tests through its paternity testing division, DNA Findings. The privately held company is headquartered in Houston, which is also home to its state-of-the-art Genomics Research Center.