Natera – 2013 Fierce 15

Natera CEO Matthew Rabinowitz

Based: San Carlos, CA
Founded: 2004
CEO: Matthew Rabinowitz
Website: Natera.com

The Scoop: In the crowded field of noninvasive prenatal testing, Natera boasts what others can't: The company's diagnostic can detect the chromosomal abnormalities that spell Down syndrome, Edwards syndrome, Patau syndrome and Turner syndrome, all with greater than 99% sensitivity. Now, with a heap of venture cash and cosigns from some of the world's largest labs, Natera says it's poised to take the market by storm.

What Makes It Fierce: Sequenom ($SQNM), Ariosa Diagnostics, Verinata Health--each markets a prenatal test designed to ferret out chromosomal issues, and each touts itself as offering reliable, actionable information to expecting mothers. What they all lack, however, is the ability to look at small fractions of DNA and make calls on an unborn child's health, Natera CEO Matthew Rabinowitz said, and that's where his company's technology comes in.

Other testmakers scout for abnormalities using the qualitative method, Rabinowitz said, looking at the amount of DNA on a sample chromosome and comparing it to a healthy reference, thereby making a diagnosis. That's all well and good in the abstract, but real-world cases often present only fractions of DNA, he said, leading to loads of false positives from qualitative analyses.

Natera's Panorama test, on the other hand, sequences maternal DNA and then looks at thousands of single-nucleotide polymorphisms to suss out what will be passed down to the child. From there, results go into Natera's proprietary algorithm, which can compute the probability of problems with chromosomes 21, 13, 18, X and Y.

That allows for a level of specificity impossible with qualitative methods, Rabinowitz said, and, in trial after trial, Panorama has demonstrated sensitivity beyond that of its competitors.

"We explicitly calculate the probability of the correctness of our call for every sample," he said. "We can explain our confidence for every patient. There is nobody in the world that can touch our performance, and that's one reason for our explosive growth."

Since its founding in 2004, Natera has grown faster than any prenatal testing outfit in history, Rabinowitz figures, and this year's launch of Panorama has only accelerated its success. Since unveiling the test in March, Natera has inked distribution deals with lab giants like Quest Diagnostics ($DGX), Bio-Reference Laboratories and ARUP Laboratories, getting Panorama into clinics around the globe. In May, Natera pocketed $54.6 million in venture cash, wooing big names like OrbiMed Advisors, Sequoia Capital and Lightspeed Venture Partners.

All that buzz has led to a few floated buyout offers, Rabinowitz said, but "we're not going to casually sell ourselves." An IPO isn't completely out of the picture, he added, just not anytime soon and not on a particular timeline.

"The company's really well-positioned," Rabinowitz said. "I'm not of the mindset to distract ourselves with an IPO right now, because we really just want to dominate this market."

And, with seemingly each month bringing a new Panorama-devoted lab partner somewhere in the world, Natera looks to be well on its way to doing just that.

What To Look For: Natera plans to spend much of its latest haul on commercialization, but the company is also funding R&D, running studies to prove Panorama's worth in detecting triploidy and some cancer-related mutations. In the long term, Natera plans to leverage its core competency to offer a range of genomic tests. "We are not just a one-trick pony," Rabinowitz said.

For more:
Natera heads east for prenatal Dx market expansion
Natera expands its reach in hot prenatal Dx market
Natera hauls in $54.6M for prenatal Dx
Natera launches prenatal diagnostic with big Quest co-sign
GSN raises $20M, changes name to Natera

-- Damian Garde (email | Twitter)

Natera – 2013 Fierce 15
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