In the field of infection diagnosis and treatment, tNGS is a phenomenal product.
At the beginning of 2023, some industry media disclosed that tNGS technology, which had just entered the clinical application half a year ago, had completed the testing of more than 100,000 samples, which can be said as the peak of listing. The clinical needs of tNGS are clear and easily accepted by doctors and patients, driving the continuous growth of the sample number. The greater logic behind this is that, in recent years, more and more clinical attention has been paid to the precise diagnosis and treatment of infection, which has objectively driven the vigorous development of the pathogen detection industry. Taking the detection of respiratory diseases, which is mainly driven by tNGS as an example, from 2019 to 2023, the domestic market size of this industry increased from 7.821 billion yuan to 12.096 billion yuan, with a compound annual growth rate of 11.52%. It is expected that between 2024 and 2028, the market size of the respiratory disease testing industry will increase from 14.869 billion yuan to 40.481 billion yuan, with a compound annual growth rate of 28.45%.
On the other side of the coin, tNGS companies are now in a dilemma. As a new diagnostic technology with high threshold, tNGS requires break-even. Most companies with tNGS business struggle to make money.
Boot up that loss. Recently, some practitioners calculated an account to the artery network. At the average terminal price of 800 yuan per time, if hundreds of samples are not collected in a single startup, under the pressure of pathogen gene extraction, database building, sequencing and labor, the revenue generated by tNGS testing is not enough to cover the cost. Arterial Network has learned that since late 2023, the TNGS business in the hospital has collapsed significantly, and a large number of pathogenic gene testing enterprises have closed more than half of the tNGS business centers, and only a few testing laboratories that can still barely profitable are still in operation.
"In a sense, we don't want to do tNGS, but we have to do it."The practitioner sighed.
An fire tNGS
TNGS, pathogen targeted sequencing, bypass the traditional microbial culture, directly to the clinical samples of dozens to hundreds of known pathogenic microorganisms and their virulence and / or resistance gene enrichment, then high-throughput sequencing, after database analysis, to determine the samples contains pathogenic microbial species, to clear diagnosis, for accurate diagnosis of clinical infection provides effective new tools.
Around 2020, the development of mNGS (pathogenic metagenomic sequencing) technology is in full swing. There is a growing belief that mNGS can be used as a last resort clinical search for pathogens. A series of expert consensus introduced at that time also supported this point. But the mNGS detection reagents on the market do not have the medical device registration certificate, just like the sword of Damocles hanging over the head of the industry. Weiyuan gene, golden key medicine, micro rock medicine and other early mNGS star enterprises, have started the product compliance work. The compliance of mNGS requires the gene extraction instrument, sample library building instrument, sequencing analyzer and test reagent to obtain the product registration certificate. Soon, the hardware equipment product registration certificate has been approved down. With the product registration certificate, mNGS enterprises can carry out business in compliance with the hospital and obtain a stable sample size.
However, the mNGS compliance process, stuck in the reagent link. Different from the hardware equipment application product registration certificate only needs to do simple performance verification, the reagent approval logic is more complex, requiring clear samples, targets, organs, diseases, and a corresponding relationship. This principle naturally conflicts with the principle of mNGS. The sequencing object of mNGS is the whole genome of alveolar lavage fluid, cerebrospinal fluid and saliva, and the complete gene sequence is compared with the pathogen gene bank to find out the pathogen type infected by the patient. In other words, the clinical value of mNGS is difficult to clearly confirm under the existing regulatory rules.
Subsequently, some mNGS enterprises made bold innovations and tried to apply the framework of tumor NGS panel products, that is, to find out some of the gene loci of high pathogenesis, to form a relatively small site combination (panel), and to declare the products. If the pathogen of the patient is other than panel, the supplementary test will be made in the form of scientific research reagent. This is the prototype of tNGS detection. Unfortunately, despite several adjustments in the product mix, the mNGS big panel product application has been rejected. At an industry conference in early 2022, regulators made it more clear that they would not encourage the IVD application of innovative products.
In the second half of 2022, the commercial clinical application of tNGS suddenly exploded.
In the early years, a subsidiary of Goldfield Medical acquired a genetic testing company to develop a product line of multiple reconstruction library methods. However, the idea was put on hold as the NIPT individual markets quickly became saturated. At the end of 2022, when the road of mNGS commercialization was blocked, Jinyu Medical restarted the genetic testing project and upgraded it to commercial tNGS testing.
After entering the clinic, tNGS technology is very good at playing. The rapid volume of tNGS clinical samples mentioned at the beginning of the article is one side. At the same time, tNGS technology has squeezed out the market share of other star products in similar scenes. Previously, media reported that in large third-class hospitals in some provinces, the number of mNGS tests in ICU has declined for two consecutive months, and some samples were sent to tNGS, because tNGS charges are far lower than mNGS. And the original opened in the respiratory ward multipathogen detection products, also began to divert a part to tNGS. The reason is that tNGS is priced close to respiratory poly, but covers more pathogens and can detect resistance genes.
The unexpected explosion of tNGS attracted many genetic testing enterprises to join, and the industry became lively. Needless to say, the enterprises originally engaged in mNGS testing services have opened up tNGS business, and some clinical general inspection enterprises have also tried to catch the express train of genetic testing through tNGS.
However, only a few companies have shared in the tNGS business boom.
Good products, but not yet a good business
It is worth noting that, despite the clinical fire, tNGS technology has also failed to follow the path of product compliance.
Similar to the mNGS technology, tNGS also faces the dilemma of difficulty in proving the clinical value, but the difficult manifestations are different. Theoretically speaking, tNGS may register according to the application logic of respiratory tract joint inspection products, but how to obtain enough positive sample size is troubling tNGS enterprises. In the product registration, the number of patients and disease structure enrolled in clinical trials have clear requirements. In addition to a large number of negative samples, tNGS reagent product declaration needs to provide positive samples for each target, disease, sample category, and the number of samples for each combination reaches 3000 to 5000. You can imagine how hard it is.
Can not get the product qualification of tNGS testing, failed to form a unified commercial closed-loop mode. Overall, there are two broad categories of tNGS admission methods. One is the conventional IVD mode of selling equipment, using reagents as consumables, and the other is the service mode of sample delivery. In the service mode, some tNGS enterprises record in the hospital and prescribe through the information system in the hospital, while more tNGS obtain scattered samples based on the cooperation with doctors and nurses.
Among them, selling equipment and consumables is undoubtedly the most efficient mode, and the channel cost is relatively low, but the stability of sample acquisition is higher. Still, this model has not become mainstream."Currently, hospitals are starting to introduce equipment. For example, youan, Xiangya, and the Jiangxi Maternal and Child Health Hospital to be invited, "one practitioner said," but basically they are not doing it themselves, tNGS is not doing it, and manufacturers will try to send people to support it.”
At the present stage, the largest volume is the tNGS sample delivery service mode registered by hospitals, that is, the tNGS commercialization strategy adopted by Jinyu Medicine. The threshold of such a strategy is extremely high and hardly barely replicated by other participants. As a leading clinical general inspection service provider in China, Jinyu Medical has a strong channel network covering the whole country, and has established in-depth cooperation with a large number of hospitals, providing thousands of clinical testing outsourcing services for the latter for a long time. TNGS testing, as an added list, can quickly form a stable massive sample recovery channel."Jinyu Medical is based on a huge clinical resource pool, and even if the conversion rate is low, the business volume is considerable."There are practitioner analysis.
No matter the temporary inspection enterprises, or special inspection enterprises, often do not have such resource ability. For the tNGS detection business, the sample size has a special great significance. Take the comparison between tNGS and mNGS as an example, the former is not profitable, while the latter is profitable. However, since the sequencing data volume of mNGS is much higher than tNGS, if enterprises can get enough samples and spread the large cost generated by gene sequencing, the profitability of tNGS is completely possible to surpass mNGS and become a good profitable business. However, some practitioners point out that the sample size of many tests can not even cover the average cost of 5,000 yuan per day.
As a result, in addition to the tNGS business is still at full speed, new entrants have contracted business. Among them, the clinical general inspection enterprises are separated by mountains, they do tNGS is still very difficult, and not surprising. Clinical special inspection enterprises hold high high, but also repeatedly hit a wall.
Since 2019, many disease-related gene testing enterprises have been landed in the hospital. Since 2023, these enterprises have stopped the hospital cooperation of mNGS, and only a few hospital teams with a considerable number of samples are still supporting them. The pathogen NGS business of more pathogen gene testing enterprises has shrunk to the dilemma of only sequencing samples nationwide.
The underlying logic behind this also lies in that the incremental business model based on clinical general inspection created by Jinyu Medical is far from the familiar playing method of mNGS enterprises. Most of the founding teams are born in the genetic testing industry, and domestic mNGS enterprises are used to taking the route of special clinical examination and discussing cooperation from hospital by hospital."It is very slow to talk about special inspection cooperation, as short as 1 to 2 years, as long as 2 to 3 years."Li Hang, founder of Strategy Bio, pointed out that" By introducing special inspection programs, hospitals should bear compliance risks."Even if the cooperation is implemented, there is still uncertainty about whether mNGS can get enough samples, because it is usually not exclusive.
Obviously, pathogen genetic testing companies need to think beyond tNGS technology.
The third way for tNGS enterprise products
"After more than 10 years of attempts, people began to realize that if NGS technology is purely used to support the whole industry chain, it is difficult to make profits."So a lot of companies are gone, and they can't stick there in the mNGS and tNGS industries," Li said. Financing is not smooth, the capital is burned out, the product certification has not come down, the number of samples recovered from admission is small, which is a very objective reality.”
Although the peer halfway off the card table, people sigh, but more enterprises, are not willing to leave the emerging field of infection prevention and control."TNGS and mNGS represent the future of pathogen genetic testing," said more than one practitioner. " But for now, find a way to survive.”
In the past, it was relatively simple for biotechnology innovation enterprises to survive. In a relatively loose external environment, a slightly promising technology may get enough funds to support the development of enterprises and products. Now, many troubled NGS companies are trying to walk on two legs.
On the one hand, widen the path of pathogen gene testing and try to create cash flow in the short term. Up up genes, down PCR, up sequencing, down nucleic acid, some tNGS try to extend the product line to the more positive respiratory test."We have been meeting the threshold in genetic testing, which takes a long time to work hard, even if the future certification, it also needs to increase the sample size, so we were forced to go down the track."Li Hang told the arterial network.
Interestingly, the forced business strategy of changing the track, but objectively constructs the pattern of graded diagnosis and treatment of pathogenic infections. In theory, there are subtle differences in the clinical scenarios of respiratory polytesting, tNGS and mNGS. The combined use of the three can lock the pathogen of infection on the premise of minimizing the waiting time of patients and controlling the nosocomial spread of the disease.
Specifically, with the help of respiratory polyexamination, patients can complete the basic screening of infection pathogens in lower medical institutions. For example, the six joint tests of respiratory pathogens provided by Shengxiang Biology covered the common pathogens of upper respiratory tract infection shown by flow adjustment. If the patient is infected with the pathogen, then tNGS is used for further screening, covering 100 to 200 common pathogens. Only a very small number of patients infected with rare pathogens ultimately require mNGS for a definitive diagnosis. In this sense, on the long enough track of pathogen gene testing, respiratory tract polyexamination, tNGS and mNGS each have their own value, delineating the basic framework for the construction of the product system of pathogen gene testing enterprises.
On the other hand, the product exploration of tNGS is fundamental and also the future. Another antenna of most tNGS enterprises is still the technological innovation of doing tNGS. After 2 years of iteration, the product logic of tNGS is becoming clear. Different from the large panel of tumor NGS, which will benefit patients more, tNGS panel should continue to be small and choose more accurate and more in line with clinical needs."Of course, not all tNGS enterprises can eventually come out. I am more optimistic about BGI, Golden Medicine, Weiyuan Biology and other clinical and technological enterprises," Li said. " Once they get the certificate, they will quickly occupy the market.”
Several tNGS practitioners have expressed full confidence in the market pattern after tNGS commercialization. In addition to the first tier of the first certified enterprise to become the head brand, as the second tier of tNGS enterprises, the industrial chain opportunities are worth waiting for. Based on the experimental coverage capability of the national delivery network, they may serve as the channel fulcrum of the head brand, provide the admission detection service support in specific areas, or even be acquired as a regional team."According to past experience, the industrial chain of clinical special inspection, general inspection enterprises are not competent."Said one practitioner.
In fact, the ups and downs and turns of mNGS and tNGS are the only way for innovative biotechnology to reach its clinical application. At this stage of pathogen genetic testing, some people leave and some stick to it, but we would like to believe that a clear clinical value will lead this innovative technology to a certain future.
