"Last week Illumina Inc, the market leader (by number of units shipped) in gene sequencing machines announced a 60% reduction in price of it’s personal full genome sequence. The price is now down to $19,500.
Health Care Information Technology: Moore’s Law is so last century!
The same test was:
$350k in 2009
$650k in 2008
$3B in 2003"
I loved this post by James Siminoff about how Moore's Law is affecting Healthcare Diagnostics, because it was the subject of my internship at Becton Dickinson. The layman definition for Moore's Law is that every 18 months, the number of circuits on a semiconductor doubles. It's not a law of physics, but the magical semiconductor R&D labs always seem to do it. Accompanying the doubling of circuits, is a similar price drop of something like 50% for a given level of computing power. The price drop isn't a law of economics and wasn't even addressed by Moore, but it just kind of happens, and you can bank on it.
One of the best things about going to Business School is your summer internship. You get to try out a whole new profession for three months. You meet great people along the way, learn about what you love, and do great work. BD is a Fortune 100 company and they asked me to research and propose a strategy in the molecular diagnostics market for them. BD was very strong in old school, culture based tests, but didn't have much of a presence in the new fangled Molecular (gene based) market. Molecular Diagnostics are fantastic at determining the genetic markers that tell us whether someone is genetically predisposed to things like Breast Cancer and other diseases. Your genes don't lie and there is a wealth of information in them.
Moore's Law is something that hadn't really occurred to the folks at BD because they had spent their careers in Healthcare, a place where costs only seem to go up, not down like clockwork in technology. However, I'd spent the early part of my career doing Investment Banking for tech companies and I saw the magic that was unfolding in this market. In fact, the capacity improvements and price reductions were blowing away Moore's law, increasing and decreasing respectively by about 4x a year.
The trick in Molecular is finding the genetic markers that correspond to a disease. As James shows above, the tools capable of this work were insanely expensive, kind of like how old mainframe computers were when the computer revolution started. But Moore's Law gradually made the personal computer and server market accessible and today we walk around with a phone that is more powerful than those old mainframes. My message to BD management was that diagnostic toolmakers were going to make finding genetic markers cheaper and easier than they had ever imagined, and we would have a healthcare revolution on our hands shortly. Management enthusiastically embraced my recommendation and has made moves into the market.
I share this story because for all of the developments going on in Information Technology, I think the most exciting leaps are taking place in Healthcare. Technology is a beautiful, unrelenting force, powered on by human ingenuity, and soon, very soon, we'll all be better off for its magic.
