deCODE genetics

To judge by the intense media coverage of deCODE's discoveries, ordinary people were very certainly interested in these genetic risk factors and how they might be relevant to their health. In late 2007, the company effectively launched the field of personal genomics with its deCODEme direct-to-consumer (DTC) scan aimed at enabling people to better understand their risk of common diseases and use this information to stay healthy. deCODEme hit the market a day before the now widely known, Google-funded 23andMe. deCODEme's marketing emphasized its pedigree, seriousness and scientific rigor: "provided by a world leader in the discovery of genetic risk factors for disease...[so that its customers] benefit directly from the knowledge and experience of scientists carrying out internationally renowned research" (its competitors used deCODE's published variants as the basis for many of their results); with the scan processed in the same labs that had found them. By 2012, the deCODEme complete scan measured one million SNPs and calculated risk for 47 common diseases and traits as well as basic information on maternal and paternal ancestry, noting that most ancestry scans of the period were not back by much data.

Despite deCODEme's emphasis that its results were for informational purposes — "a roadmap to improve your health" — and the provision of genetic counseling for users who had questions about their results, US regulators quickly took a critical view of disease risk assessments being put directly in the hands of consumers. In June 2010, the FDA wrote to deCODE and its main competitors to say that they considered such scans to be medical devices requiring FDA approval. Facing regulatory headwinds and then corporate reorganization, deCODE stopped selling deCODEme in late 2012. In 2017, the FDA began to approve certain assessments of genetic risk for disease in consumer tests.

In 2018, deCODE broke new ground with a direct intervention in public health and the first national genetic screening program of its kind. The company launched a website that enables anyone in Iceland to ask the company - free of charge - to search their whole genome sequence data to determine whether they are likely carriers of a SNP in the BRCA2 gene that confers high risk of breast and prostate cancer in Iceland. Within months, ten percent of the population had requested their BRCA2 status, and the National Hospital has built up its counseling and other services to help people follow up on their preliminary results and use the information to protect their health.

Business

Despite its pathbreaking science, or perhaps because it was often far ahead of the field, deCODE had a volatile history as a standalone business. In July 2000, it completed a $200 million IPO on Nasdaq, big for the time and the first listing by an Icelandic company on a US exchange. Its early pharmaceutical alliances, particularly that with Roche, further helped to fund the enrollment of most of the adults in the country in the first decade of its research, and the rapid expansion of both its discovery capabilities and its product development efforts in drugs, diagnostics and personal genomics.

From a scientific perspective, as the Broad Institute's David Altschuler told the MIT Tech Review in 2004, "This is a business in which critical mass is important, and they have achieved critical mass." But the business was also about money. Being an innovation enterprise pioneering new markets, the company had spent more than $500 million on R&D in its first decade and never been profitable. By 2006 it was borrowing more, to fund drug development programs based on completely novel premises; to bring forward diagnostic tests in a market that even supporters termed "still embryonic"; and to market personal genomics, where it was being overshadowed by the Silicon Valley glamour and cash of 23andMe.

By late 2008, the company was "between a rock and a hard place," in Stefansson's own words. Under threat of being delisted from Nasdaq for its flagging stock price, the company needed more capital just as the global markets were going into crisis. Although its scientists kept publishing breakthroughs at a remarkable rate, in late 2009, the company's listed US holding company, deCODE genetics, Inc., declared Chapter 11 bankruptcy. Its key assets - the heart of which was the Iceland genetics operation - were bought and kept running by a consortium of the company's two main original venture backers: ARCH Venture Partners and Polaris Ventures, along with Illumina, Inc., the dominant maker of genotyping chips and sequencing equipment. It abandoned work on its drug development programs.

As a business, deCODE had in some sense gone back to the future: it was a 13-year-old company with a global reputation, again backed by its original VCs, which Newsweek called "the world's most successful failure." During the following period Stefansson mused publicly that deCODE had been founded between six and ten years too early. The technology for accurately reading DNA with sufficient detail, he reasoned, had not arrived until the mid-2000s, leaving deCODE in debt for years of R&D but based on findings that didn't provide a detailed enough insight into the biology of disease to swiftly create commercially compelling diagnostics and developmental drugs. What might provide that insight was population-scale WGS data. By 2010 Stefansson was outlining how to sequence a few thousand individuals and then use imputation - powered again by the genealogies - to ensure that deCODE would be the first in the world to have anything like it.

In spite of its straitened circumstances, with Illumina as one of its owners the company could still receive the latest sequencing machines and reagents. In 2011, deCODE and Illumina collaborated on a paper that gave an early hint at the power of WGS imputation, turning 500 sequences into 40,000 whole genomes of data. This was enough to begin to discover rare variants, validated through replication in several other populations. Unlike common variants, mutations causing rare diseases tend to be in the regions of genes that encode proteins, providing both a direct window on disease biology and so more direct utility as drug targets. In December 2012, the American pharmaceutical company Amgen acquired deCODE for $415 million.

A key rationale for the acquisition was deCODE's unique ability to use WGS data to discover rare coding variants and cause extreme versions of more common diseases. As Sean Harper, then Amgen's head of R&D told Forbes, "It was really working on targets like PCSK9 [for heart disease]...that really drove home the immense value of having targets that have either been discovered or validated by the kind of human genetic analysis that Decode is a world expert in." More broadly, these capabilities could be applied to evaluate current programs as well, and within month of the acquisition deCODE had reviewed Amgen's entire pipeline. In 2018, Harper estimated that "just [by] having strong genetic support for half your pipeline you can improve your rate of return on R&D investments by approximately 50%." By 2020, Amgen had brought two new cardiovascular drugs into clinical trials based directly on deCODE discoveries, which continue to be published in leading scientific journals.