Sam Altman Is Bullish on Biotech Startups | Hacker News Reader

Sam Altman Is Bullish on Biotech Startups

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Biotech is certainly exciting on the cost front as technology progresses, however, there is an even easier win which is bringing price transparency to supplies and reagents.

We've worked with every YC biotech company (except Ginkgo) and the savings is massive verse paying list price. Startups are unable to negotiate competitive prices from large distributors due to their limit budgets so we've been pooling their purchasing power.

Recently, we've started doing analytics (http://labspend.com/) for labs on supplies/chemicals and see huge differences even in universities that spend 10+ million per a year.

Here is an example from four universities located in the midwest of the USA for a commonly used chemical reagent called acetonitrile.

List price for this item is currently at $1335.49 (http://www1.fishersci.com/ecomm/servlet/fsproductdetail_1065...) and here is what university labs are paying $399.31, $239.16, $220.54, $156.10 - image: https://dl.dropboxusercontent.com/u/7671582/chemical-pricing... ).

We commonly see 10x savings, but even in this example 5x can be quite significant in the budget of a start up.

Interesting! So are store.p212121.com or lapspend.com aka offers.p212121.com hooked to the same backend? Can I buy from labspend.com? Since universities buy through their labs do they see divergent prices even within the same institution? How do you provide cheaper prices - do you buy in bulk and then redistribute or do you simply get lower prices bc you move large volumes via pooling? I think you are onto something really cool here. I imagine a future where perhaps Stanford would do all their buying through you since you could pool the volume of multiple large research institutions. Btw how do you process payments? Also the more info boxes on labspend.com don't seem to be working.

We started by offering an e-commerce solution although we are adding products like crazy there's 30+ million chemicals/products in science. This is another reason we built out labspend which has a different backend. We are seeing labs paying different amounts at the same school. Stanford we are able to find 10-20% savings at times, but there are in a good place compared to start ups.

Sorry about the Lean More buttons not working and will get those up to date soon. Feel free to shoot me email if you have a specific question (sean@p212121.com).

> We've worked with every YC biotech company (except Ginkgo)...

Heh. After a brief glance at their website, they look like a better-funded version of the "herbal what-not" email that ends up in my spam folder.

It's possible you saw a different company's web site--Ginkgo Bioworks is a synthetic biology company: http://ginkgobioworks.com/

I know it's a bit OT as these companies are more established, but what listed stocks show some promise in BioTech that are worth watching? (Both big and small)

I won't make any specific recommendations, but you can learn more by following these journalists:

- Adam Feuerstein: http://www.thestreet.com/author/1352996/AdamFeuerstein/all.h... (and the rest of The Street's biotech coverage: http://www.thestreet.com/headlines-and-perspectives/biotech/)

- Matthew Herper: https://twitter.com/matthewherper

Ta! :)

Any news from the YC-backed Immunity Project? Seems like nothing new on their blog or Twitter feed since 2014: https://www.immunityproject.org

Sh*t takes time.

Well, critics warned it was a scam and crowdsourcing funding was a way to bypass legit medical processes and review. I want to give them the benefit of the doubt, but a year's silence doesn't look great.

(Disclaimer/shameless advertisement: I am a co-founder of a project in the problem domain. We are currently in seed stage, fundraising mode, and are going to have a look at the U.S. east/west coast soon).

I am quite happy to see YC to jump on the SynBio train. While other specialized accelerators such as IndieBio [1] have been first in this fairly unclaimed industry sector, I expect their involvement to trigger a cascade in professional investment that will help the bulk of us to get more money. In contrary to software (and for a multitude of reasons), biotech investments have recovered at a much slower pace since the 2008 crash.

If I get around to make a solid write up, I would like to compare the wet/hardware biotech startup accelerator experience. As in software, biotech tools have made a great improvement and became cheaper by orders of magnitude. However, the development workflow is still different, and many things such a reproducibility, lab environment, specialized talent are not as easy to come by in a lean and fast accelerator program. 3 month to MVP is a true challenge - we were quite lucky that we made it [2].

Biotech can be far more complicated as software on the business side of things, and going lean is often not really an option (think production standards, ISO/cGMP). A 1:1 copy of the software accelerator model is definitely not enough.

[1] http://indie.bio [2] http://sothicbio.science

Prior discussion on YC + biotech: https://news.ycombinator.com/item?id=9997722

I'm still wondering what YC's value proposition is in this space: https://news.ycombinator.com/item?id=9998739

Same here. By partnering with academic labs, you can often minimize the upfront cost of both equipment and technical assistance, as well as gain credibility. Downsides include (1) your IP has to be licensed from the university (https://news.ycombinator.com/item?id=10001393), and (2) you can't (directly) control recruiting.

Agreed on your two points. I'll add that my own experience of licensing (my own) IP from a top-25 university TTO has been interesting: their terms are pretty fair, they haven't been too sluggish on coming to decisions and executing, but despite their previous successes with monetizing their IP they come off as pretty clueless about business in general. I also get the feeling that while they certainly want their money, they're really more interested in the prestige of being able to let their PR office go nuts about how their IP is a commercial success.

What were your thoughts on the whole "cult of the molecule" thing from the interview? It struck me odd that Sam would ignore any number of collaborations that have happened and are happening in pharma, and ignore the (as I see it, very legitimate) motivations for maintaining trade secrets.

Which interview?

> I'll add that my own experience of licensing (my own) IP from a top-25 university TTO has been interesting

In my experience, there's a lot of variance between universities, and even between tech transfer officers within a given university. Another complication: at Harvard/MIT, where professors may have cross-institutional appointments, you need to nail down exactly who you'll be dealing with (for example, the Broad has their own TTO: https://www.broadinstitute.org/osap). There are also other issues, such as IIAs & CRADAs.

> What were your thoughts on the whole "cult of the molecule" thing from the interview?

As you said, it fails to take into account existing attempts to form partnerships by biotech VCs:

- http://lifescivc.com/2014/04/pushing-forward-with-collaborat...

- http://www.bizjournals.com/seattle/blog/techflash/2014/01/a-...

This is one of those situations where presumption of stupidity (http://www.aaronkharris.com/presumption-of-stupitidy) can be very tempting, given the magnitude of the problems that remain unsolved in the biosciences. It can also take quite a bit of digging to find this info - it's not splashed all over the front page of TechCrunch, like the latest batch of YC startups are.

Gotta agree with this. If YC is serious about biotech, we should expect them to start bringing domain experts into the fold soon - doctors, surgeons, eminent researchers, possibly folks with high level experience in regulation etc. I imagine we'll start seeing this soon.

They recently added Anne Wojcicki (23andMe) as a part-time partner.

Thanks for posting this; it will save me the trouble of re-expressing my strong reservation surrounding YC's involvement in scientific startups.

In short: I'm still having trouble understanding what YC offers early-phase startups, relative to university partnerships.

Makes sense to me. I was talking to a trader the other day and I asked if he bought when Hilary's comments drove the prices down. Seems he turned a pretty penny for his firm.

The technology required is becoming more accessible, the research and break throughs certainly aren't going to stop, I guess the big question really becomes, which companies? Unless there's a bubble, because the profits don't materialize (in which case progress would slow only to pick up again down the road I figure).

Of course, you could probably buy a fund which tracks that particular segment of the market.

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