Blackstone growth leads $200 million investment in DNAnexus
Bioinformatics company DNAnexus Inc. has raised $200 million in a financing round led by Blackstone Inc. fund. The series I round values the Mountain View, California-based company at $600 million, said people familiar with the matter who asked not to be identified discussing it. It was led by funds managed by Blackstone Growth. Existing investors Northpond Ventures, GV, Perceptive Advisors, Innovatus Capital Partners and Foresite Capital also participated, according to a statement reviewed by Bloomberg.
DNAnexus, founded in 2010, has a platform that puts massive sets of genomic data into the cloud so they can be accessed and analyzed by researchers who may be unable to process that volume onsite. The findings can then be used to develop new medicines. Its customers include pharmaceutical and diagnostics companies, as well as medical centers and the U.S. Food and Drug Administration.
“Over the last five to seven years, the cost of producing a gene sequence has dropped enormously, which has resulted in an explosion of the data,” DNAnexus CEO Richard Daly said in an interview. “The way you make it more valuable is you provide it in an environment where not just the genomic data but other data related to patients can be pulled together. You want to know: people who all had heart attacks – what do they all have in common genomically?”
One DNAnexus customer, Regeneron Pharmaceuticals Inc., scoured genomic data and found a protective mutation in the genes of obese people who hadn’t had heart attacks. It used that information to develop a drug, Daly said. “We’ve been thinking about the explosion of genomics data and how that will be used to power the next generation of innovative compounds,” Ram Jagannath, who runs health care investing at Blackstone, said in an interview. “DNAnexus was the first to create this operating system.”
Blackstone has in the past two years led investment rounds in other health care firms including Medable Inc., Cryoport Inc. and Precision Medicine Group. “The real competition here is the DIY – pharma building out these environments internally,” said Mike Kirkman, head of health care for Blackstone Growth. “We think there’s going to be a continued migration from DIY to DNAnexus over time.” DNAnexus plans to use the funding to advance its platform, expand internationally and integrate more A.I. and machine learning technologies.