Genetic Testing: Where Is the Real Risk?

Sandra Martinez, a junior partner in a new biotech venture capital fund, is working on a due diligence report on a new genetic testing firm that plans to launch a direct-to-consumer (DTC) platform for assessing cancer risk. She is mildly concerned about some bad publicity around a faulty chip used in DTC genetic testing, then becomes more worried as she looks deeper into genetic testing itself. She learns that some women have undergone major surgery to prevent breast cancer after discovering they have a genetic mutation that increases their cancer risk, only to find later that the mutation has been reclassified as “of unknown significance.” Martinez knows there is a huge market for genetic testing, but she wonders about the future of the market and the ethical issues around it. She must consider potential risks and benefits of investing in this industry as she prepares her recommendation. This case is used at Darden in the second-year “Solutions and Innovations in Health Care” course. It would also be suitable in other courses covering the health care sector.