Published On August 12, 2015
Young scientists in the biomedical field may be feeling that they’ve gotten a raw deal. Many find themselves stuck in lengthy postdoctoral positions, leaving them in what the National Institutes of Health has called “a holding pattern.” They’re trained for academic jobs, but there aren’t enough of those to go around. Even if they do get coveted faculty positions, they may spend a decade struggling for funding: The average age at which a researcher first receives an NIH grant is now 42. With such dispiriting prospects, it’s little wonder that many young scientists are willing to embrace the risks of a startup.
But starting a company that specializes in biotechnology—a broad term for technologies that use living organisms or cells—is a daunting endeavor. Research work requires a laboratory, and a laboratory requires capital for rent, expensive equipment and salaries of lab technicians.
One promising alternative is taking shape in Silicon Valley. Researchers can now purchase services from state-of-the-art labs by the hour, allowing them to carry out experiments without buying a single test tube or hiring a single employee. The idea is to take the concept of the “sharing economy,” in which individuals share, say, the same car or same home, and see if it can be applied to science.
Transcriptic was first out of the gate, launching earlier this year to offer by-the-hour space in fully automated labs. Researchers log on to the company’s website and specify the experiments they need performed. Robotic devices at the laboratory site in Menlo Park then carry out the protocols with plates of biological samples in a facility that operates around the clock.
The menus currently include a wide range of fundamental processes, such as DNA cloning and the measurement of key proteins. Renting time on one of Transcriptic’s machines that replicates DNA costs $2.80 per hour. Buying that same machine would run about $20,000.
Transcriptic didn’t invent outsourcing for research and development. Plenty of scientists already make use of contract-research organizations (CROs), companies whose labs contract to do research projects, and during the past decade, CROs have come to handle an increasing amount of work for biotech and pharmaceutical companies. But firms typically hire CROs in extended (and expensive) arrangements. This new model invites customers to rent equipment much more cheaply, with less commitment.
Many processes start with a sample that comes from a researcher’s home lab. Once that sample arrives at Transcriptic, it typically doesn’t touch human hands again. That automation is a clear selling point for Matthew De Silva, whose company, Notable Labs, is trying to devise personalized treatments for brain cancer by testing combinations of thousands of Food and Drug Administration–approved drugs against each individual patient’s tumor cells. Screening all those mixtures requires precision, and De Silva says he previously encountered human error in both CROs and his own lab.
De Silva says he still uses traditional CROs for some standardized experiments, including those involving animals, which Transcriptic’s robots can’t handle. They can, however, prepare a plate containing 1,331 different drug combinations, a job De Silva recently ordered. “We just uploaded an Excel file with the combinations we wanted, which took all of 20 seconds,” he says, and the plate was ready for pickup the next day.
Transcriptic CEO Max Hodak says his company’s services have appealed most to personalized medicine companies, such as De Silva’s, and to synthetic biology companies that are tweaking the DNA of microorganisms to make them produce useful substances.
Because of the lab’s speed and volume, Hodak says that some companies are tracking their experimental runs with machine learning algorithms, which then analyze the results and churn out suggestions for the next set. “That’s beyond just taking the busywork off people’s hands,” he says.
Both Transcriptic and its first competitor, Emerald Cloud Lab of South San Francisco, may see early adoption by another group: university researchers. So says Luke Timmerman, who runs the biotech news and analysis site Timmerman Report. “Academics are the ones under the most financial pressure, because of general stagnation in federal research budgets,” says Timmerman. “They’re under pressure to do more with less.”
And a closer relationship to universities may provide another benefit: introducing these cost-efficient methods to graduate researchers. Elizabeth Iorns, Ph.D., a part-time partner at Y Combinator—a startup accelerator that helped fund Transcriptic—sees these rent-a-labs as an opportunity for young scientists. “There are lots of highly trained researchers with great ideas and not a lot of opportunities in the academic setting,” Iorns says. By bringing down R&D costs, she adds, “a postdoc who has found something really exciting in the lab can say, ‘I want to turn this into a company.’ ”
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