By Jenna Phillips and Esther Ketelaars, PA Consulting
Microbial life was lifted out of obscurity in the late 17th century by Dutch scientist Antonie van Leeuwenhoek as he peered through his microscope at water and dental plaque and discovered, entranced, bacteria: “no more pleasant sight has yet met my eye than this of so many thousands of living creatures in one small drop of water, all huddling and moving, but each creature having its own motion.” For the next 150 years, microbes remained virtually ignored, until the mid-19th century when Louis Pasteur and Robert Koch started an arms race to discover treatments and vaccines to tackle the newly discovered pathogens, disease-causing bacteria. Despite scientific consensus that some bacteria could be beneficial for human health, the paradigm that bacteria caused disease took hold in the public and political imagination, resulting in the 20th century’s military campaign against microbial and viral infection. With the development of broad-spectrum antibiotics and disinfecting cleaning products that “kill 99.9% of all germs,” humanity entered into the germophobic era. Antibiotics became widely used and abused, which has led to highly resilient, persistent, life-threatening antibiotic-resistant microbes that are making it harder to fight microbial and viral infections.
Yet, in recent years, renewed mainstream scientific interest in health-promoting microbes has shifted the paradigm, making society’s understanding of microbial life more nuanced. We now know that there are as many bacteria in our body as our own cells, and that they produce small molecules that regulate how our bodies function, as well as supporting the health of our immune system. We used to think of the immune system as an army, there to fight off infections, whereas the new paradigm views the immune system as more similar to a gardener, helping to promote the growth of microbes that we need, as well as weeding out the less desirable or downright dangerous ones. Therefore, the immune system and the microbes in our body are two sides of the same coin. When one is disrupted or damaged, it affects the other. For example, broad-spectrum antibiotics kill all bacteria, the good and the bad, which counterintuitively can disrupt immune health, making you more susceptible to infections. Research now supports the notion that bacteria in our gut, on our skin, and even in our lungs are producing millions of small molecules that support health by stimulating our immune, hormonal, and nervous systems. The genomes of all these influential microbes are referred to as the microbiome, and this new knowledge has provided a myriad of groundbreaking insights into how humans can harness the power of microbes to improve and maintain their health.
While There Is Still Much To Learn, Microbiome Holds Significant Promise
Investors, scientists, and entrepreneurs across industries are growing more interested in leveraging this expanding knowledge base to grow their businesses in pharmaceuticals, consumer health, food, cosmetics, animal nutrition, and beyond. In the microbiome therapeutics market alone, recent estimates predict annual market growth of 62.9 percent CAGR from 2018 to 2025.1 Rates of investment in the microbiome category are increasing as both venture capital firms like Seventure and pharmaceutical companies like Johnson & Johnson and Takeda make significant investments and establish partnerships with a variety of start-ups that are commercializing novel offerings in the microbiome space. A booming microbiome market is coming into existence, driven by several scientific and societal trends, and it is already starting to generate major returns for companies that have made investments in cultivating the microbiome. We see four major drivers for the microbiome market, outlined below, which are crucial for any company seeking to enter the microbiome market to leverage.
1. Rapid scientific innovations in high-throughput sequencing is facilitating an explosion in microbial research and driving the development of novel therapeutics and consumer health offerings.
Since the National Institutes of Health-funded Human Biome Project, which ran from 2005 to 2010, there have been numerous large-scale research programs focused on examining how the microbiome differs between people. The largest public effort to date, the American Gut Project, has a publicly accessible database with more than 30,000 microbiome records.2 Latest DNA sequencing efforts suggest each individual has approximately 500 species of bacteria living on and in them. Most of these were previously unknown as, according to a 2019 survey using metagenomic data acquired from stools from participants across 32 countries, 77 percent of discovered bacterial strains had never been seen before.3
Like the genomic revolution 30 years ago, the cost of microbial sequencing has steadily been decreasing; this was driven by the reduced cost of sequencing itself, but in the last three years it has been driven by engineering solutions that reduce the quantity of reagents needed to prepare samples for sequencing. These combined cost efficiencies enable scientists to perform larger and more complicated clinical studies and allow companies to offer microbial analyses at much lower prices to healthcare providers and consumers alike. Different methods exist for providing different information. For example, 16S rRNA sequencing provides data on the proportion of different bacterial species; metagenomic sequencing provides information on the proportion of functional genes and genomes of each species; metatranscriptomics provides proportional data on which genes were being transcribed into RNA at the time of sampling; metaproteomics provides proportional data on which proteins were active at the time of sampling; and metabolomics quantifies the abundance of small molecules produced by bacteria in a sample. These provide different approaches that companies can exploit to characterize the microbiome or to develop therapeutics based on the microbiome. Microbial analyses are being offered to researchers, hospitals, patients, and, increasingly, also to consumers. The genomic revolution that enabled 23andMe to provide genomic testing to the general public is now making its way to the world of the microbiome as microbial diagnostics companies like DayTwo are providing similar offerings focused on the gut microbiome to consumers.
2. Microbial evidence is becoming more robust as the body of knowledge grows; some first-mover biotech and pharma companies are starting Phase 3 trials, while novel therapeutic targets are coming to light at a rapid pace.
While much remains unknown about the complexities of the microbiome, robust clinical trials and laboratory research are starting to define and diagnose a “healthy” vs. “unhealthy” microbiome. New research findings are correlating unhealthy, or imbalanced microbiome, known as dysbiosis, with gastrointestinal diseases such as irritable bowel disease (IBD), metabolic diseases such as obesity, inflammatory diseases such as arthritis or allergies, mental health issues such as depression, and even cancer. The gut-brain axis has been invoked to understand how bacterial metabolism in the gut can influence brain chemistry. For example, a recent study has shown that a reduced risk of depression is associated with bacteria in the gut that can synthesize a neurotransmitter called gamma amino butyric acid (GABA): when these bacteria are more abundant, a higher quantity of GABA is found in the brain.4 This research is being commercialized through a start-up called Holobiome, which aims to produce antidepressant probiotics.5 While most studies and companies are focusing on the gut microbiome because it houses 90 percent of microbial biomass and activity, it’s important to note the influence of skin-associated bacteria on conditions such as psoriasis or acne and that imbalance in the nasal microbiome can make individuals more susceptible to infections, increase the likelihood of disease transmission, as well as lead to olfactory deficits, and, by extension, neurological diseases.
3. Microbiome knowledge can enable personalized medicine and further personalize the health offerings that have permeated society.
Collectively, society has moved on from “one size fits all” products toward the creation of products specifically tailored to an individual’s needs and requirements. While currently the most sophisticated personalization offerings are in e-commerce, advertising, and entertainment – Amazon, Google, and Netflix, to name a few – the trend toward personalization couldn’t find a better champion than the microbiome. The human microbiome is truly personalized and unique: it varies depending on our genes, age, diet, immune status, medication regimes, homes, countries of residence, holiday destinations, and our interactions with friends, family, acquaintances, and pets. Indeed, the microbiome is more unique than our genes, as even identical twins have different microbiomes. It is likely that each person has an entirely unique complement of bacterial strains.
This opens up the potential of precision personalized medicine, where treatments would be tailored to specific individuals based on what bacterial strains they have. There is increasing scientific evidence that shows how different strains of bacteria can change how drugs work in an individual’s body. Additionally, precision medicine can make existing treatments more efficacious by ensuring that the drug-microbe interactions improve patient outcomes. For example, cancer immunotherapy is more effective when certain species of immune-stimulating bacteria are present. Moreover, the knowledge of the microbiome provides researchers and pharmaceutical companies with unprecedented granularity when designing clinical trials, as it now becomes possible to use the microbiome to stratify a cohort to optimize the human population under investigation for the drug or intervention under investigation. It would be possible to select populations that will respond to the drug or intervention and exclude populations that won’t and, via this screening, speed up clinical approval and drug delivery. This concept applies not only for the medical sector, but also to consumer products that may improve the efficacy of skin and hair care products, dietary interventions, pet care, and diet options, and potentially any other field where there are responders and nonresponders to a product.
4. Consumers have become increasingly health conscious, and wellness products, such as microbiome-based offerings, empower them to take control of their own health.
Consumers are more informed and empowered than ever before: they know what they want and demand loyalty from suppliers and brands, particularly when it comes to their health. As out-of-pocket healthcare costs have risen, consumers are taking their health into their own hands. Consequently, the wellness market, comprising several markets like dietary supplements, healthy foods, fitness and lifestyle activities, and more, has enjoyed steady growth for years. As new research findings about the microbiome reaches mass media consumers, the views of a growing group of informed consumers are becoming more nuanced regarding health and the role of the microbiome. Beyond changing views, we see consumers changing their lifestyles to incorporate more foods and behaviors to support a healthy microbiome. Probiotics have become a household wellness staple and prebiotics, foods, or nutrients that support the growth of specific beneficial microbes and other food supplements are becoming more prominent features in the diets of those who prioritize wellness. Many of the advanced start-ups are focusing on synbiotics (the combination of pro- and prebiotics) by providing a tailored microbial consortium of probiotic organisms and nutritional supplements that can feed this consortium to aid their beneficial effects.
If one can leverage these four drivers, there are huge opportunities in the microbiome market. Of course, challenges remain and organizations seeking to enter the dynamic category of microbiome research and product development must have a strong understanding of the market, the risks, challenges, and the underlying science, all of which are constantly evolving. In our next articles we will outline some of the challenges in the market, examples of how companies have leveraged these market trends, and the implications for companies and investors.
About The Authors:
Jenna Phillips is a consumer health expert at PA Consulting focused on growing great businesses and brands in the health and wellness sector. Her background in public health and nutrition and experience working with organizations as diverse as food companies, dietary supplement brands, personal care and fitness gives her expertise in the area of probiotics and their function for consumer application. Connect with her on LinkedIn.
Esther Ketelaars is a life sciences expert at PA Consulting. She supports life sciences companies in differentiating their therapies and further personalizing medicine through innovative approaches, such as the use of digital measures in clinical studies. With her background in Immunology and Microbiology at ETH Zurich, she is leveraging her combined expertise to explore the opportunities the microbiome presents to personalize healthcare. Connect with her on LinkedIn.