Genalyte is one the most exciting new additions to Seed Healthcare’s investment portfolio. Noted by Fast Company as “Like Theranos but it Works,” Genalyte has been leading development on the first ‘lab in a box.’  

Genalyte’s solution “The Merlin” dramatically rethinks laboratory testing to improve care, lower costs and deliver an exceptional patient experience. Their on-demand, on-site laboratory testing with central lab oversight will enable accurate, reliable results in under 30 minutes versus several days. This will allow patients to receive their lab results during their office visit and discuss them in real-time with their physician.

After submitting for FDA clearance of their TSH assay in December, the Genalyte team has since been making progress on future submissions for both the Merlin as a whole, and additional assays. Genalyte’s CEO Ashraf Hanna, Ph.D., M.D. sat down with us to answer questions about the Merlin and its impact on the laboratory testing experience.

What sets the Merlin apart from other blood analyzers currently on the market? 

Typical small blood analyzers currently on the market are only able to process a limited amount of panels, require upfront investment from a clinic, and often require a specialty lab technician or device operator to pipette the blood, invert the tube, and operate the machine.

It can be difficult for clinics to invest in devices that do maybe one or two panels and require this extra labor to complete the tests. Not only is it anticipated that the Merlin will do 90% of the most commonly ordered laboratory tests and it also requires no investment from the clinic. 

When placing the Merlin in a clinic setting, (a point of care location), Genalyte will open a moderate/high complexity lab at the clinic’s location.  This allows lab testing to be done on-site.  Using Genalyte’s cloud platform allows the results to be transmitted to the provider’s EMR, and bills the patient’s insurance automatically. In a study done by Harvard Medical and Mass General Hospital, on-site laboratory testing yielded a drop in follow up phone calls by 81% and follow up visits by 61%; these decreases led to an average physician savings of about $100,000 per year, while providing better care for patients. 

In addition, the American Medical Association recommends patients to have their laboratory tests completed before their appointment with a physician. The Merlin enables this recommendation in a much more efficient and patient-centric manner than is currently available. 

What has been the response from patients after experiencing real-time lab results?

In a survey of patients who received real time lab results from Genalyte vs standard send-out labs, patient satisfaction with their lab service went up from 33% to 88%, and lab testing dissatisfaction dropped from 49% to 4%. 

Having “real-time” lab tests is seen as an extremely valuable benefit, and it’s easy to understand why. Real-time labs eliminate the need for patients to travel to another off-site lab, possibly taking more time off work for yet another appointment. Having the lab results during the doctor visit also eliminates the anxious days patients experience while waiting for lab results, and instead patients can discuss results and form a care plan in the same visit. 

In comparison to the current send-out lab system of industry leaders, how do your profits and pricing compare? 

Planned pricing for laboratory tests on the Merlin are expected to be set at current industry accepted rates of major insurance companies and Medicare, so there is little to no difference from the larger companies. 

In regard to profits, that is where the difference is seen. Because the Merlin processes blood on-site, the logistics of shipping blood samples off-site for processing is eliminated. These logistics have been shown to cost 40% of the revenue of major send-out laboratory companies.  

This costly transit also introduces additional risks that blood samples are lost or damaged in travel. A published analysis of send-out labs showed that about 5% of samples had an error in the result, half of which could lead to “severe harm,” and the majority of errors originating from sample handling and shipping.  So by eliminating shipping, we reduce errors and expenses.  

Can you discuss the proprietary technology in the Merlin that allows for rapid testing? 

The Merlin is enabled by an assay detection technology based on a silicon photonics sensor that measures binding of molecules on the surface of a silicon chip. The sensor detects changes in resonance wavelength when molecules bind to the chip, eliminating the need for fluorescent, luminescent, or radioactive labels used in current forms of immunoassay formats. 

This new technology of measuring a frequency vs the traditional measurements of amplitude, in current machines is akin to the transition from AM to FM radio. This technology is groundbreaking and paves the way for faster and more accurate immunoassay testing. There have been over 42 papers published on this technology, and can be found at www.genalyte.com.  

What is your background and how did you decide to join Genalyte as CEO?

I completed my Ph.D. in Physics at Harvard, then went to med school. I’ve been involved in companies at the intersection of technology and medicine since then. The first company I worked at, Tanox, invented a novel way to treat asthma. It had the largest IPO in biotech history at the time, going public at $1B in 2000 and the drug now sells approximately $4B per year. I spent most of my career at Genentech, growing with it from a mid-sized company to one of the largest biotech companies.  It eventually was bought by Roche for $100B. Most recently I was the COO of Verily, (Google Life Science), and it’s where I learned of the Genalyte technology. I introduced it to my colleagues at Google and they were equally impressed. I left Google to become Genalyte’s CEO, and they invested in Genalyte’s Series C. The potential of the Genalyte technology is tremendous and can really improve healthcare for everyone.