London-based pharmaceutical giant GlaxoSmithKline has invested $300 million into San Francisco-based genetics company 23andMe. The investment was strategic as GlaxoSmithKline will split the costs and profits with 23andMe to develop new medicines. This collaboration will last for four years.
“I’m so excited what this can do for both companies, and maybe more importantly for what the customers at 23andMe and patients across the globe,” said GlaxoSmithKline Chief Scientific Officer Halo Barron via Forbes. “I think that if we are successful, and I think we will be, in showing that there really is a new model of doing drug discovery that is faster, better, cheaper, maybe we can really change how the entire industry thinks about this important problem.”
23andMe’s valuation as a result of this investment was undisclosed. Back in September, 23andMe raised $250 million at a $1.75 billion valuation. 23andMe founder and CEO Anne Wojcicki pointed out that this deal is “transformative” and emphasized that GlaxoSmithKline is a “powerhouse partner.”
Currently, 23andMe has 5 million customers who sent in saliva samples, which are analyzed for identifying genetic changes across 700,000 locations in their genomes (containing 6 billion DNA base pairs). The customers receive information about their genetic differences and some information about their ancestry.
Forbes pointed out an example of how their partnership would work in the context of a gene called LRRK2 related to some Parkinson’s disease cases. About 10,000 Americans have Parkinson’s caused by the LRRK2 gene. And GlaxoSmithKline is working on an LRRK2 drug, which would need patients to test it on. 23andMe has 250 Parkinson’s patients with the LRRK2 gene variant, who have agreed to be contacted for clinical trials As a result, GlaxoSmithKline could develop the drug much faster.