The African genome is the most genetically diverse in the world. However, until now, the global scientific community has largely ignored the rich diversity and ancestry of the continent’s DNA, which currently makes up only 2% of the global genetic database.
What does this mean in reality? Global pharmaceutical companies are more frequently using genomic and phenotypic DNA research to build personalized drugs. Yet without any clear understanding or sequencing of African DNA, this will essentially leave an entire continent [and its Diaspora] without access to revolutionary new drugs.
This is the challenge which 54gene, an African genomics company that launched in January 2019, sought to tackle when its founder, Dr Abasi Ene-Obong, left his role as a management consultant in the pharmaceutical sector, to move back to Nigeria to build Africa’s first biobank.
No mean feat, when you consider that Ene-Obong and his team at 54gene are starting from the very beginning; there are no blueprints for this market on the continent.
However, having completed stints at the prestigious US-based technology accelerator, Y Combinator, and having also graduated from the recently concluded Google Launchpad Africa accelerator program, 54gene have captured the imaginations of some highly influential international investors.
Looking to radically disrupt the $100bn global pharmaceutical industry, at the beginning of July 2019, they announced a $4.5mn seed round from Y Combinator, Fifty Years, Better Ventures and KdT Ventures, which marks the biggest seed round for a Nigerian health tech startup.
We spoke to this enigmatic doctor-turned-entrepreneur to get an insight into 54gene and the dynamics of the African health tech sector:
Tell us about your journey before 54gene. What led to you creating the company?
I spent some time in the US after my Masters in Business and Management (Biosciences Management), but a lot of the inspiration came when I went back to Nigeria. It not only struck me that we didn’t have the facilities to analyse genetic tests, but there was a real need to equilibrate the imbalance of genetic research into African data. This had to change and with African data being the most genetically diverse on the globe, incorporating it into global research offers groundbreaking diagnostic and therapeutic insights which will be critical for all populations.
You raised the largest amount of funding for a health tech startup when you were a six-month-old start-up, was your business an easy sell to investors?
For our seed round, the majority of our investors were international – we weren’t able to collaborate with African investors until we made traction with the international investors, I think because this space hasn’t, to date, been on their radar. The African VCs we spoke to didn’t have the global context of genetics + pharmaceuticals. Whilst the genomics sector in Africa is fairly new, it’s a multi-billion dollar global market. I think the sticking point for some investors on the continent is that they didn’t understand that lack of research and drug provision for people of African descent affects people across the world and subsequently, the business opportunities that follow.
What this means is the market potential is truly global and when you consider how our insights could advance the quality of global healthcare by helping all ethnic populations, there’s even more scope to disrupt a $100+bn industry.
The gap in research for African genetics has been present for decades. Given you’re in a space with multinationals who may have more resources to solve this, what makes you different?
Healthcare in Africa can be disjointed, but it’s also an incredibly difficult system for a big, foreign company to operate in. It takes a team that understands the nuances of the system, as well as the more sophisticated healthcare market of the US and Europe. My team and I have experience on both sides and we know how to move through the systems in Africa, but also, we understand how to unlock the value outside of Africa. It’s about being able to bridge the gap between two worlds, which I think is where our real niche lies.
Whilst we’re continuing to see rising investment into African tech, only a small proportion of this has been in health tech. Why do you think this is?
Africa’s healthcare sector – both traditional and tech-focused, is still in its nascent stages, which means the actual business of healthcare still needs to mature. For example, there are more variations of HMOs, pharmacies, hospitals etc. on other continents, which offers a more attractive proposition for investors. There’s undoubtedly long-term value in our industry, but unfortunately, some investors are risk-averse at this stage. But these things are cyclical; a few years back, everyone was investing in e-commerce, then last year it was fintech, this year it has been transported, and we hope that very soon, you will hear about even more health tech investments.
And then there’s the type of issues our startups are addressing. For a period, health startups mainly focused on electronic medical records (EMR), which is important, but it’s only now that we’re seeing more pressing problems being solved, such as delivering blood and oxygen or drug procurement. As we move up the value chain, I think we’ll see a greater flow of funds and gradually the funding gap with the other sectors will fall.
What’s your vision for the company as it grows?
We’re on a mission to build the world’s largest pan-African biobank, which means we’re planning to collect 40,000 data samples by the end of 2019, with a view to this being 100,000 over the next 12 months. On top of this, we’ll be expanding into a number of African countries and looking to start piloting clinical trials with pharmaceutical partners.
In the long-term, the goal is for us to become a global force within the healthcare market so we’ll also be investing heavily in building data science capabilities to find our own targets and provide the pharmaceutical industry with access to African genetic data. The idea is that the more companies that have access to our data, the more value it will hold for consumers in the long-term so we’re aiming to co-develop with them.
Source: Forbes
