A trend McKinsey calls “synthetic biology—which is essentially the merging of science and big data—can be seen across diverse fields, including medicine, biofuels, agriculture, food/nutrition, and even cosmetics. In this overview of what we call a growth theme, we explore the investment implications.
Tommy: Harnessing our understanding of genetics and advancements in related technologies to solve known problems both in healthcare and agriculture is a topic we’ve been focusing on in some depth. About 40 million people in the United States and Europe have a rare genetic disease, and finding cures for these patients has created an enormous investment opportunity. Gene therapies modify or replace existing genes that are either missing or defective in some way. In this way a gene therapy approach does more than just treat the symptoms of disease; you’re curing the illness. The market opportunity for gene therapies is huge. Assuming a price of $100,000 per patient the total addressable market could theoretically be as big as $4 trillion.
Ben: Sustainable agriculture is an interesting growth area, particularly biologic solutions, given food production will need to rise materially over the coming decades to meet expected population growth. The products and techniques that have enabled yield improvement have come at a cost, both from a human and environmental perspective. This highlights the need for new solutions to drive incremental yield improvement while at the same time minimizing health and environmental risks. Given the global food market is roughly $5 trillion, we see a rich opportunity set for growth, particularly in biologic solutions.
Tommy: Liquid biopsy—another technology made available through advancements in the field of genetics—is a simple blood-based test that detects whether you may have early-stage cancer. Early cancer detection can increase survival rates significantly, but the gold standard of detection—tissue-based biopsy—isn’t practical for an otherwise healthy patient. We’ve sized the total addressable market for liquid biopsy at $50 billion, and some estimates value it up to $75 billion. Either way, the market is only about 1% penetrated, leaving plenty of runway for future growth and attractive investment opportunities.