New-age Spirit as Business DNA
Kochi: The world woke up to the historic news on April 14, 2003 of the accomplishment of complete sequencing of human genome as part of the Human Genome Project (HGP). A 41-year-old technocrat, who was then heading an IT company based out of Chennai with a subsidiary in California, was equally excited. Though he never studied Biology after his high school days, the techie decided to learn more about human genome and the profound impact of the scientific achievement. After devoting six years to familiarise himself with the particular branch of science, he decided to launch an enterprise which deals with the science of genome. Thus was born SciGenom in 2009.
Meet Sam Santhosh, who is successfully pursuing his ‘second innings’ in entrepreneurship. Sam completed engineering from Thrissur and took MBA from IIM Calcutta. “Then I came back to Kerala to start a software company. Calsoft (California Software) was my first successful company but even before that I had set up two small companies. In 1987 and 1988 software market here was very small and lacklustre. In 1991 I made my first trip to the US to attend the COMDEX exhibition held in Las Vegas. I got my first customer from there which was an oil company named Chem Oil. I started working on a project for them and later in 1992, I established Calsoft,” Sam goes down memory lane at his office at Infopark Kochi.
“The sequencing,” Sam continues, “was major news then. The hype was that access to the genetic code would revolutionize healthcare. The more I learned about it, the more enthusiastic I became to get involved in it. Initially, I thought I would transform my software firm into a bioinformatics company. Calsoft was reasonably big in terms of turnover and it had gone public by then. None of the Board members endorsed my view of getting into the genome field, which was not our core competence. But, I had already made up my mind and called it quits to start an enterprise on genomics,” he says.
Over a period of two to three years Sam invested about $4 million to set up SciGenom. He moved technologies to India, procured the right equipment, trained the right people and got that platform running to do sequencing of genomes.“I didn’t take any fund from outside. I roped in Indians from the US who were willing to come back to Kerala to be part of the core team. Then, I decided to launch genome sequencing services to earn some revenue and establish the core skills. Labs across the country required this service. However, at that time, labs in India were relying on companies in China or Korea to do the work. Projects were also small and, as a result, nobody found it worthwhile to build a full-fledged facility here. I saw it as an opportunity and decided to set up the lab. My goal was to develop different companies which can use this technology in different areas. The sequencing and analysis of the genome can be seen as a horizontal in the business sense and the possibilities lay in developing solutions for different verticals on the same platform,” he says.
Sam incubated MedGenome in 2011 and spun it off in 2013 as a separate company with a separate lab in Bengaluru. “Then I incubated a second division which was AgriGenome. Later, in 2016, I hived off AgriGenome from the parent company and started taking outside funding. Now, SciGenom, MedGenome and AgriGenome are three separate companies,” he says.
MedGenome, in 2013, raised $4 million in its Series A round funding from Emerge Ventures. In, 2013, it had raised another $20 million from Series B round funding from Sequoia Capital. In August 2017, the company raised $30 million through Series C round funding led by its existing investor Sequoia Capital and new investor Sofina SA, based out of Belgium. In 2018, MedGenome raised a funding of $10 million from HDFC Ltd., along with its insurance arm HDFC Life and asset management firm HDFC Asset Management. Altogether, MedGenome’s Series C round of funding totalled $40 million. In AgriGenome, first round of $5 million was funded by Emerge Venture in 2016.
To put things in perspective, MedGenome Labs is a genomics and clinical data-driven diagnostics and drug discovery research company. A market leader in genetic diagnostics in India and one of the highest throughput Next Generation Sequencing (NGS) lab in South Asia, it possesses state-of-the-art genome sequencing platforms such as Illumina’sNovaSeq, HiSeq X, HiSeq 4000 and 2500, MiSeq etc. Overall, more than 550 hospitals and around 5500 clinicians leverage the services of MedGenome, which has worked extensively on building clinical databases of more than a million patients through collaborations. “We have a repository of clinical, phenotypics and genomics data of 1,70,000 patients to provide insights into complex diseases at genetic and molecular level,” Sam informs.
AgriGenome Labs (AgGenome) became an independent company in 2016 with facilities in Genome Valley, Hyderabad and SmartCity Kochi. It has infrastructure to provide genome sequencing, editing and bioinformatics services for plant, animal and microbial projects of the industry as well as academic and government institutions.
In the last fiscal, MedGenome clocked an annual turnover of $26 million. “In the current fiscal, our target is $35 million. We expect around $20 million revenue from the India market alone. The firm is growing at the rate of 60 to 70 per cent per year. Currently, in MedGenome, we have around 500 people. AgriGenome, which recorded an annual turnover of $4 million last fiscal, has around 100 employees while the staff strength is about 15 at SciGenom, which is not doing sequencing now as it is exploring few other technologies. Though I had plans for new verticals like veterinary genome or aquagenome and the like, we have classified the services into two – human and non-human – for the time being,” he says.
MedGenome conducts more than 350 tests. Most common among them can be classified under three categories – for cancer treatment, pre-natal and treating medical conditions of newborns. “We focus only on diseases. Cancer is one of our major specialisations. A part of the tissue taken for conducting biopsy in hospitals is forwarded to us. We first extract DNA from it. Then the sample undergoes library preparation by adding the necessary reagents. Then it is introduced into a sequencing machine which is connected to a computer. Once the data is retrieved, we pick up the necessary details from it. Genome analysts will prepare a report based on the inferred data and it will be sent back to the doctor stating findings and implications,” Sam explains.
According to Sam, MedGenome’s larger plan is to cross $100 million revenue from India market alone within the next few years. “Then we can think about going for a public issue for MedGenome India,” says Sam, who is now working towards reducing the cost of diagnostic services to one-third so that more people can avail of the facility.
“In the near future, as technology develops, genetic diagnostic services will become faster. However, in terms of technological advances, the field is not likely to witness any fundamental change as gene editing seems to be the ultimate thing. Research activities in gene editing are going on and in five years it would be possible to offer gene editing as an option for treating certain types of diseases. But it would be very expensive initially. It will take much more time to make it a universally affordable one,” he says.
At the same time, Sam’s vision is to make MedGenome a global leader in the field of personalised medicine. “Healthcare delivery would witness fundamental changes as a result of the analysis of huge volume of data obtained through genomics. In our facility in the US, we are actively engaged in finding new drug targets using the data that we receive. Traditionally, drug development has been based on trial and error method. We would not clearly know why a drug is working on a particular human being and not on another person. Even now, many successful drugs would work effectively only on about 40 per cent of the users. In others, it is not causing any impact. This model can be changed completely. Using genetic data, we can clearly find out why a particular drug is found to be effective in one patient while it is not in another person. Why is a disease affecting one member of a family and not the others? MedGenome’s larger vision is to evolve personalised medicine. Along with diagnostics, we should be able to produce appropriate medicines. We can also develop medicines to cure diseases in a better way by developing specific drugs that suit certain group of people taking into consideration the uniqueness of their genes. We have around 40 staff working in our US office who are fully engaged in finding new drug targets and validating them,” Sam says.
As a Keralite, why did you choose Bengaluru to set up your diagnostic lab facility instead of Kochi? I asked. “Yes, there is a reason for that. In fact, my choice of operations was Chennai. But NarayanaNetralaya offered to give me space in their facility. I figured out that the ecosystem would be better there. There was no big challenge as such to start operations in Kerala, but to scale up is a real challenge in Kerala, mainly because of the lack of infrastructure and talent. Mostly, I am looking for PhD holders and people who have masters in branches of biology such as micro-biology, biochemistry and bioinformatics. Moreover, we cannot run a full-fledged diagnosis unit in Kerala because of the State’s unpredictable nature of protests. Imagine a sample of a critically ill patient getting stuck at airport because of motor vehicle strike. It’s a bane of Kerala,” he adds.
“I feel we should shed our ego once you embrace entrepreneurship and start attracting people who are better than you into your company. Instead of getting into very rigidly hierarchical structure, I believe in cultivating a teamwork approach – wherein you treat your colleagues on an equal footing – while pursuing specific goals. That’s what I have always tried to do at Calsoft and at SciGenom, too. Coming to the work place should not be a painful affair for the employees. The office ambience should be one blending fun and learning,” Sam reveals his success mantra.
In India, according to Sam, people have a tendency to detach themselves from the learning process once they reach a certain level of success or age. “I feel it is a major drawback compared to the work cultures prevalent in many other parts of the world. At the early stages of life, we are willing to learn as many things as possible. Once we land a job or attain a certain position in career, we feel like there is no need to learn anything more. In fact, this is not the right attitude,” he adds.
Sam strongly feels that the education system in India, especially Kerala, has to change in a big way. “I see parents taking leave for a year or more to support their kids prepare for entrance examinations. Children are being forced to study. We are killing their innate ability to think. You can see that kids, particularly in the first four or five years, are natural learners, curious to know about things that they see around them. In fact, our education system has to complement that.
Unfortunately, our existing system makes kids apprehensive when it comes to learning. Learning has to be a fun-filled affair. We have increasingly become a society having a closed mindset. Caste and religious divisions are again wrenching our society. It’s not at all a good thing. Religion and spirituality are different. You need not be religious to lead a spiritual life. Having said that, if someone wants to embrace spirituality through religion, that is also fine. The bottom-line is that there has to be an open and scientific thinking in society,” he sums up.
Born at: Thrissur
Based in: San Francisco
Family: Jayasree Santhosh (spouse); Lakshmi and Devi (daughters)
Hobbies: An avid reader of history and science literature. Loves to travel.Of late, developed a habit of visiting botanical gardens across the world. “I have a property in Shornur (Palakkad District) where I have a large collection of medicinal plants.”
Favourite Gadget: Not a gadget freak despite being a techie. “I am not brand conscious at all.”
Drives: Porsche Panamera E-Hybrid
Favourite Cuisine: Likes all cuisines, no specific taste
Favourite Music/Movie: Not much interested in music. Like comedy movies – Malayalam and English; Favorite actors: Jack Nicholson, Nedumudi Venu
Leader you admire: “I have learnt many things from a number of leaders like Richard Branson, Bill Gates, Steve Jobs etc. I believe the DNA of a company would be that of the founder and its key resources. I feel, its not fair to be wanting to be exactly like a particular company. However, we should definitely learn from others and make appropriate changes in your working style, whenever required. It is an ongoing process.”