NextCODE Health Launches deCODE's Clinical Genomics Platform

October 24, 2013

By Allison Proffitt 
October 24, 2013 | deCODE genetics’ genomics platform has new life as NextCODE Health. The private company announced it launch yesterday with an exclusive license deCODE’s platform, a leadership team of deCODE alumni, and $15 million in venture financing. 
NextCODE Health, Cambridge, Mass., holds a five-year exclusive license to use the genomics platform developed by deCODE genetics—including IT infrastructure and data analysis capabilities—for sequence-based clinical diagnostic applications. Hannes Smárason, CEO of NextCODE Health, says the goal is, “the widespread incorporation of sequencing information to accelerate patient diagnosis and care.” Smárason previously served as CFO and executive vice president of business and finance at deCODE from 1997–2004
“We’re building on the platform that we licensed from deCODE, which is all of the IT systems that have been developed at the company for the last sixteen years, together with access to the reference database, which is the biggest in the world—30 times bigger than the 1000 Genome Project for example,” Smárason told Bio-IT World. “We believe these two tools together will be much more informative than any other solution that’s available in the market today.” 
When deCODE declared bankruptcy in 2008, it had nothing to do with the science, said found Kari Steffanson in an interview earlier this year. “We started the company eight years too early. But we wouldn’t be the powerhouse we are today if we hadn’t started that early. We wouldn’t have the database we have… The kind of genetics we were doing has been too pre-competitive, too difficult to attach it to something money-making. But it’s becoming easier now.” 
deCODE emerged from bankruptcy thanks to relatively small buyout in 2010 by Polaris Partners and ARCH Venture Partners. Just over three years later, the business was sold to Amgen for $415 million. 
State of the Platform 
In March, Amgen’s Senior Vice President Research, Sasha Kamb, wouldn’t say whether any of the deCODE business would be spun out as a separate company. He called the Clinical Sequence Miner—deCODE’s comprehensive clinical data IT infrastructure and interpretation suite—“impressive” but “a small part of the equation.” 
Now NextCODE is taking on the product, and taking the next step. 
NextCODE will leverage deCODE’s Genomic Ordered Relational (GOR) database infrastructure and sequence analysis systems, and will continue to develop these systems for specific needs associated with clinical research and care. Analysis will be supported by access to deCODE’s substantial, proprietary knowledge base that includes more than 40 million validated variants as well as analysis of public databases.
Unlike deCODEme, deCODE’s personal genomics test, NextCODE solutions will be offered through medical centers and research institutions that have formed partnerships with NextCODE. This week the company announced the first four partners: Boston Children’s Hospital (US); Newcastle University (UK); Queensland Institute of Medical Research (Australia); and Saitama University (Japan).
The first partnerships focus on clinical diagnostics in oncology and pediatrics—both large markets for clincial genomics—but Jeff Gulcher, president and CSO, says that the company isn’t limited by therapeutic area. “It’s really dictated by the medical centers or diagnostics companies that become our partners. What are they most interested in analyzing?” 
NextCODE offers an end-to-end solution, Smárason says, to incorporate sequence data into clinical diagnostic applications. The company accepts legacy sequence data from customers, but Gulcher points out that many medical centers prefer to do their own sequencing, and that NextCODE prefers to get the raw data instead of VCF files. If a partner doesn’t want to submit data, the company has a CLIA-certified lab in Iceland that can do the sequencing. 
Either way, raw sequence data is run through a pipeline that combines the GOR infrastructure, access to deCODE’s substantial knowledge base including public and proprietary reference sequence data, and systems for genome analysis and interpretation. NextCODE’s product—now called the Clinical Sequence Analyzer (CSA)—facilitates rapid confirmation of mutations through visualization of raw sequence data in real time, providing greater transparency than existing systems and enabling users to validate their findings with speed and confidence. 
The results are provided to clinicians via, “clinican-friendly Web-based tools,” says Gulcher, “that allow them to tap into the GOR database that we created for them... Medical centers prefer to make the diagnosis themselves, so we try to enable them to make the diagnosis based on the sequence data.” 
Users can identify and confirm possible mutations, collect disease-causing mutations into a custom database, and generate printable summary reports. This backend technology enables NextCODE’s customers to manage and successfully analyze genomics data at a large scale without investing in a substantial IT infrastructure.
In addition to Smárason, many of the NextCODE team hails from deCODE. Gulcher was co-founder of deCODE in 1996 and served as vice president for research and development before being named deCODE’s chief scientific officer in 2003. Daniel C. Siu, vice president of worldwide sales and marketing, previously served as a managing director at deCODE responsible for the genomics service and genetic test business in North America and Asia Pacific from 2005 to 2011. Kari Stefansson, deCODE’s co-founder, onetime CEO, and outspoken deCODE advocate sits on the Board of Directors. 
In Smárason’s  mind, NextCODE is a realization of the deCODE vision. 
“[Jeff and I] have been sort of in the thick of it on and off for the last fifteen years,” Smárason said. “The idea for NextCODE has been simmering within deCODE for a long time, and after it became apparent that Amgen was interested in acquiring the company, that was put a bit on the back burner. But we’ve been working on this for a long time.” 
The funding round supporting NextCODE’s debut—$15 million in venture funding from Polaris Partners and ARCH Venture Partners, the same companies that rescued deCODE in 2010—will be primarly spent on building up the client base rapidly, investing in the commercial infrastructure, and product development, said Gulcher. 
“In order for sequencing to become ubiquitous and used on a routine basis in the  healthcare system, you need to have systems like the one that we’re deploying that can adequately import and manage all the bid data that’s going to be created from these sequence initiatives, manipulate it in the right way, interpret it in the right way, and put it in the hands of the decision-makers,” Gulcher said. “It’s a big challenge, and it’s one that NextCODE wants to be a leader in, to develop the industry standard and enable that in the hands of the physician.”