Key things to know
Genomics is the study of the complete set of DNA that provides instructions to a living being. A genome consists of all the genes of a specific organism.
Advancements in genomics have the potential to revolutionize healthcare, expediting the understanding and treatment of infectious diseases, genetic disorders and chronic conditions.
While practical application of genomic processes and techniques in still in the early stages, it’s an economic area that bears closer scrutiny for investors.
The human genome was first sequenced roughly two decades ago. Over the past 20 years, gene sequencing’s cost has plunged, fueling genomics’ ascent as a rapidly emerging industry and field of study. Investment and research and development funding waves have poured into the industry to further understand and treat various genetic disorders, complex diseases and medical conditions.
A greater understanding of patients’ genetics can empower doctors to conduct more complex medical diagnostics and offer personalized treatments based on an individual’s unique genetic sequence. Advancements in genomics represents a monumental leap in healthcare, potentially enabling people to live longer, healthier lives. For many diseases, genomics breakthroughs could offer the first genuine opportunity to cure illnesses previously deemed fatal or without recourse.
The study of genomes focuses on the complete set of DNA that provides instructions for living things. DNA is an organic chemical that contains genetic information and is found in most cells of every organism. A genome consists of all the genes of a specific organism. It’s sometimes described as a giant recipe book with directions on how to create a living thing.
Several subsegments comprise the field of genomics and are likely to benefit from Internet of Things’ growing importance and device proliferation.
Genomic sequencing-derived information holds the potential to lead a paradigm shift in the way illnesses are treated. Genomic data is currently informing a host of new therapeutic modalities including gene editing and gene-modified cell therapies. These technologies seek to offer functional cures to genetic illnesses, signifying a quantum leap from the current symptomatic treatment of such illnesses. In 2022, the US Food & Drug Administration (FDA) approved a record five cell and gene therapies, bringing the total of such approved therapies to 19.1,2 Analysts forecast the revenue potential of the five newly approved therapies to reach $4.5 billion in 2028.3
The FDA is also set to evaluate the first gene editing therapy in 2023, with potential market entry later in the year. An approval would validate gene editing techniques’ promise and open a market industry observers estimate to be worth roughly $6 billion in 2028, with far-reaching potential across a host of genetic disorders.4 The FDA’s review should also establish gene editing regulatory precedents and, if approved, pricing benchmarks.
From the use of new therapies to altering our own DNA, genomics’ far-reaching potential to transform healthcare forms a compelling thematic investing opportunity.
Analysts anticipate strong clinical trial data and continued unmet medical need across a host of illnesses will drive significant sales growth in next-generation genomic medicines from $8.8 billion in 2022 to $84 billion in 2028.5
The biotech company Illumina estimates that the genomic sequencing market will exceed $120 billion by 2027.6 Illumina estimates the sequencing industry is currently only 7% penetrated but it expects penetration to grow to 14% by 2027.7 Academic organizations, government institutions and pharmaceutical firms are among early research adopters, utilizing genomic sequencing to drive drug discovery and pathogen monitoring.
Industry observers anticipate continued declines in human genome’s sequencing cost will expand genomic technology adoption from research to clinical applications. Clinical firms use genomic sequencing to offer unique insights into individual patients’ genomes, informing patient care options and improving patient outcomes. Industry firms have worked to drive the cost per genome sequence down from nearly $100 million in 2002 to approximately $600.8 Firms anticipate the cost-per-genome sequence will further decline to $100, increasing availability and adoption of genomic analysis and unlocking genomics’ broader potential. To date, analysts estimate only 0.07% of the world’s population has had their genome sequenced.9
As the practice becomes more widespread and more data is collected, a virtuous cycle could emerge. Since vast amounts of data are needed for a comprehensive study of the human genome, a greater sample size should enable scientists to more accurately verify and validate new insights, which could improve treatments, thereby encouraging more people to have their genomes sequenced.
Widespread genomic sequencing adoption opens the door to a host of diagnostic and therapeutic applications. In cancer, genomic sequencing is helping deliver cost-effective, non-invasive screening options. Liquid biopsies are tests that look for medical signs to a specific illness in a patient’s blood. This approach can be particularly beneficial for detecting cancers that currently do not have proven screening methods and thus require invasive tissue biopsies. Liquid biopsy tests can be used as a routine screen for the presence of cancer-derived biomarkers, which analysts forecast a market opportunity exceeding $30 billion.10 Liquid biopsy tests, via genomic analysis, could also help drive therapy selection, helping predict a patient’s drug response and monitor for cancer cell recurrence. Analysts estimate drug response and cancer cell monitoring markets will grow to $6 billion and $15 billion, respectively.11,12
Continued evolution in genomics and precision medicine has the potential to fundamentally change healthcare knowledge and delivery. Human biology’s rapid convergence with big data, advanced analytics and scalable computing power offers unprecedented insights into how diseases of all kinds afflict humankind and, even more importantly, how they may be prevented. From the use of new therapies to altering our own DNA, genomics’ far-reaching potential to transform healthcare forms a compelling thematic investing opportunity.
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