Since its commercial introduction
more than a decade ago, next-generation sequencing (NGS) has matured into an
essential life science tool for genetic studies in a range of applications. BCC
Research recently reported that the NGS industry is on the cusp of a second
growth phase, powered by new applications in clinical diagnostics.
The worldwide market for
sequencing products is forecast to grow at a 5-year compound annual growth rate
(CAGR) of 18.7% to reach nearly $13.8 billion by 2020. The market can be
segmented into pre- and post-sequencing products (ie, sample preparation reagents/kits
and informatics, respectively), sequencing instruments and consumables, and
Sequencing services is the
largest and fastest-growing segment, with an anticipated 5-year CAGR of 26%.
BCC Research forecasts the value of the sequencing services segment to exceed $9
billion by 2020. The high growth rate is due to a number of factors, including
the expansion of sequencing into new applications in the clinical and applied
The main clinical
applications driving market growth are cancer and reproductive health. The
other main clinical sequencing applications through 2020 include Mendelian
disorders, infectious diseases, and complex disorders.
The main cancer applications
for NGS diagnostics include tumor sequencing, familial screening, monitoring
for cancer recurrence, and liquid biopsy. Cancer diagnostics that provide the genetic
profile of a tumor can have an influence on which therapy is chosen. This is a
critical driving force behind NGS-based tumor sequencing diagnostics. The key
issue for this application is establishing a clinical connection between a
given tumor mutation profile and an effective therapy. It is believed, however,
that many large-scale sequencing projects are addressing this issue and that significant
progress is being made.
Current applications for
NGS in cancer are focused on discrete sets of genes. However, BCC Research
believes that whole exome and whole genome sequencing will gain traction in the
future as sequencing costs fall and the value of testing for only a single gene or
several genes declines. Longer term, it is
expected that most tumors will be completely
sequenced, giving physicians full genetic
information for treating their patients.
The second application for cancer is familial
screening of relatives of patients with cancer and those who may otherwise be
at high risk. The key driving force for this application is a reduction in
sequencing costs to the point where there are significant cost-benefit
advantages for NGS tests. A second driving force in familial screening is breakout
into the general population. There is evidence that many people who have no
family history of cancer can carry risk mutations. Because most people at risk
will not undergo NGS-based screening tests without insurance reimbursement,
costs must continue to decrease and clinical validity must be established.
Monitoring is a key application for
liquid biopsy formats. Monitoring during the course of treatment is desirable
because it can assess tumor growth, metastases, or resistance to therapy.
Monitoring during therapy also allows physicians to make adjustments based on
the changing genetic profile of the tumor. For cancer monitoring, the early commercial
tests are gene-specific quantitative tests. However, the industry is evolving
toward multigene panels that cover clinically actionable mutations in a range
of genes and cancer types.
Monitoring post-treatment focuses on finding
minimal residual disease or cancer relapse. Liquid biopsies for monitoring
recurrence are designed to detect low levels of tumor mutation and to measure
tumor mutation quantities over time to assess cancer recurrence. More than 95%
of all cancer deaths worldwide happen after relapse. Finally, NGS-based tests
that can help choose appropriate patients to enroll in clinical trials, as well
as once a new drug enters the market, will help in the selection of treatment
based on a patient’s genetic profile.
NGS diagnostics are used for difficult-to-diagnose
rare genetic diseases, with multiple tests on the market. The key driving force
for this application is deficiencies in conventional approaches. Diagnostic odysseys
occur when an individual has a rare genetic disorder and undergoes many expensive
and invasive clinical tests and procedures to determine the cause. These cases
frequently occur in clinics that evaluate children for such things as cognitive
impairment, neuromuscular disorders, or congenital anomalies.
Diagnostic odysseys often include
serial molecular testing of one or a few genes, running up the costs of
diagnosis. Many of these rare genetic diseases are due to a single-gene
mutation in the genome. They are referred to as Mendelian disorders because
they comport with the inheritance pattern first discovered by Gregor Mendel.
BCC Research believes there are as many
as 25 million individuals in the US who have inherited Mendelian disorders. Some
of these are well understood, including cystic fibrosis and muscular dystrophy,
but others are much rarer. There are approximately 6,000 of these very rare
disorders, and only half of them have been identified. NGS is changing the
diagnostic paradigm in these cases because it can rapidly and more
cost-effectively deliver a correct diagnosis than conventional approaches.
The key advantage of NGS is that it is
highly multiplexed to cover many genes in one test format, including genes for which
no commercial molecular test exists. One of the key challenges to implementing NGS
for this application is demonstrating to the medical community the clinical
value of such test formats. BCC Research believes that this challenge is being
aggressively addressed by a number of leading institutions in this field, as
well as by several high-profile initiatives.
The non-invasive prenatal screening (NIPT)
market has been a major success story in the industry. The main clinical
benefit of the non-invasive test format is a reduction in the number of
unnecessary invasive procedures, which in turn results in less risk of resultant
miscarriage. A secondary clinical benefit is an earlier diagnosis of fetal
aneuploidy. NIPT is experiencing a high adoption rate among women at high risk
of having babies with chromosomal abnormalities.
Since the introduction of initial
tests, providers have sought to expand their testing menus. This is a key
strategy to getting higher market share in the at-risk population. A key issue that
will impact the future market potential is whether or not NIPT will be adopted
by the average-risk patient population. For this to happen, insurance providers
and other payor groups will need to recognize a clear clinical benefit to
screening this population segment.
For newborn screening, NGS offers much
promise, assuming that it continues down the cost curve. The key driving force for
this application is the decline in costs of sequencing and associated
informatics. For commercial success, it is critical to demonstrate that NGS
tests can provide more relevant clinical genetic information at a price point
lower than that of the current methods. If this can be done over the next few years,
it is likely that insurance companies will come onboard, and a viable market
There are ethical issues associated with
NIPT and newborn screening, many of which will be resolved over time as the tests
mature and there is greater experience among the screening population and physicians.
For many disorders, the phenotype is hard to predict, and as a result, it may
not correlate with sequencing data. This would limit the ability of the
physician to make informed decisions based on a sequencing test.
There is also the problem of trying to
implement a set of informed consent and genetic counseling guidelines for
non-invasive testing. This is particularly true for broad-based sequencing
tests, for which there are many variants of unknown significance that make
interpretation difficult. A final issue is the potential impact of NIPT tests
on abortions. These ethical issues have not prevented the high growth of
NGS-based tests for prenatal screening. BCC Research views the ethical issues
as interesting to consider, but they have little impact on the market for these
NGS is newly emerging for
preimplantation screening, driven by the increased success rates of in vitro fertilization
applications. A main hurdle is offering these tests at an attractive price point
versus microarray methods, and thereby increasing the penetration of NGS. The
tests do not rely on insurance coverage because they are offered with direct payment
from the patient. This feature has attracted the interest of a significant number
of companies. Both NGS and microarray-based tests evaluate chromosomal
aneuploidy, with screening for single-gene disorders also emerging for these
The main applications of NGS
diagnostics for infectious diseases include outbreak tracking and human immunodeficiency
virus (HIV) tropism. In outbreak tracking, the use of NGS to diagnose patients
who are hospitalized with foodborne infections is viewed as a near-term point of
entry. A positive development for this application is the use of MiSeq in regional
laboratories throughout the US to track foodborne pathogens and outbreaks. This
is being done under a pilot program sponsored by the FDA.
A main obstacle to commercialization will
be the education of clinicians regarding the benefits of using NGS tools to quickly
identify pathogen strains so that effective treatments can be implemented.
Because the initial application will be for hospitalized patients, it will be
important for developers to market the new tests appropriately to critical care
physicians and to contrast the benefits of NGS with older methods. NGS must
compete with both polymerase chain reaction (PCR) and Sanger sequencing to
meaningfully penetrate the infectious disease market.
One application in which NGS has shown
near-term commercial promise is HIV tropism testing. The genotypic assay uses
Sanger sequencing, which is the gold standard for HIV tropism testing. However,
NGS provides a better detection limit, such that mutations at lower allele
frequencies can be detected. These lower-frequency mutations
may be important in predicting drug
resistance. It is thought that frequencies as
low as 1% may influence drug sensitivity, and
the present limit of Sanger sequencing is 20%
Complex Disorders Applications
applications include immune system disorders, metabolic/mitochondrial
disorders, cardiovascular diseases, and neurological diseases. Genetic factors
may play only a minor role in some diseases, limiting the impact of NGS as a
diagnostic. For other diseases, genetics may well play an important role. It is
likely that as new knowledge is gained regarding the genetic basis for these
diseases, the need for NGS diagnostics will increase.
For immune system
disorders, the main applications include immune system profiling, human
leukocyte antigen (HLA) typing, rheumatoid arthritis (RA), and multiple sclerosis
(MS). In the field of immune system profiling, NGS is making progress through
commercial assays and research. Although Sanger sequencing is the current standard
of care for high-resolution HLA typing, NGS assays provide rapid, high-resolution
typing at a competitive cost. Research into the genetic underpinnings of RA and
MS is ongoing, and NGS technologies are useful tools in this effort. As this
research progresses, it is expected that new molecular diagnostics will be
developed, some of which will use NGS formats.
are difficult to diagnose because they have complex genetic causes and a wide
range of phenotypes, making these diseases well suited for NGS diagnostics. For
this market segment, single-gene tests do not provide enough information, and
whole exome sequencing is too costly and overkill. For metabolic/mitochondrial
disorders, a key driving force is deficiencies in conventional approaches.
neurological disorders comprise a strong potential future market for NGS
diagnostics. NGS tools have been used to show that breakdown in the control of
gene expression may help to initiate or progress some of these diseases. The market
for NGS diagnostics will come to fruition when clinical research can correlate
genetic changes with the risk of disease onset or progression.
CLINICAL SEQUENCING TECHNOLOGY CHALLENGES
Many challenges must be
overcome for NGS to be widely adopted in the clinical setting. Sequencing costs
must continue to decline at the rate predicted by Moore’s law. Price points are
bringing NGS into broader competition with other molecular diagnostic technologies,
such as PCR, microarrays, and lab-on-a-chip. Insurance coverage must continue
to expand for NGS-based tests. There is evidence of increasing coverage by
payors in some key NGS clinical markets, including NIPT and cancer.
Genetic testing generates
data specific to each patient, and there are social and ethical concerns about
the means to secure the privacy of these data, as well as who can access it.
These questions will become more important as the clinical test market grows
and as more complex tests, including those based on whole genome sequencing,
Informatics is a key
technical challenge for NGS diagnostics. For NGS data to be clinically actionable,
it must be analyzed, correctly interpreted, and put into a simple report format
for physician use. The time and resources required for handling and storing
large amounts of genetic data remain a key bottleneck in the industry. Because of
this, the informatics industry will be a critical factor in the future success
of NGS diagnostics.
This article is based on the following market analysis report
published by BCC Research: DNA Sequencing: Emerging Technologies and
Applications (BIO045F) by John Bergin. For more information, visit www.bccresearch.com.
this issue and all back issues online, please visit www.drug-dev.com.
Bergin has held business development, sales, and marketing positions with
a Fortune 500 advanced materials company, as well as executive management
positions with an emerging nanotechnology company. Mr. Bergin earned his BS in
Chemistry, his MS in Biotechnology, and an MBA.
L. Sullivan, ELS, is a Boston-based writer and editor with 20 years of experience
in medical communications. She is certified by the Board of Editors in the Life
Sciences. She contributes regularly to the BCC Research blog focusing on Life Sciences.