Since its $400 million acquisition of telehealth platform developer and telepharmacy services company Lemonaid Health last November, 23andMe has started expanding beyond its core consumer genetic testing into a new business line called its genomic health service.

“Developing our genomic health service for our customers remains a high priority for our consumer business,” CFO Steve Schoch said Monday during a conference call with investors. “This service is designed to integrate genetic health risk information into care, with the goal of preventing or better managing disease.”

CEO and Cofounder Anne Wojcicki added that the company has seen “real interest in the transition from genetics associated with ancestry to genetics being associated with health.” For 23andMe, this presents opportunities to provide genetically driven telehealth and pharmacogenomic services, she said.

Wojcicki reiterated previous statements about the importance of Lemonaid having a pharmacy. “Pharmacogenomics has huge potential for every single person,” she said.

To this end, the South San Francisco, California-based company announced two new hires.

Noura Abul-Husn was named VP of genomic health last month. She formerly was founding chief of genomic medicine and clinical director of the Institute for Genomic Health at the Icahn School of Medicine at Mount Sinai in New York.

Amy Sturm, a past president of the National Society of Genetic Counselors, joined 23andMe as director of population health genomics in May. Sturm previously ran the MyCode genomic screening and counseling program at Geisinger Health System in Pennsylvania.

“Having that kind of leadership is pivotal for the next phase of growth for the company,” Wojcicki said.

The firm started beta testing the genomic health service in the last two months, but has not decided on pricing or when it will launch. Wojcicki said that the company is making “good progress” on integrating Lemonaid’s telehealth services into 23andMe’s core consumer business, but said that the technical side of the integration is complicated. Expect more details on the genomic health service at the end of the year.

The conference call, held after market close, was to discuss financial results from the fiscal year 2023 first quarter, which ended June 30. 23andMe said that Q1 revenues grew 9 percent to $64.5 million from $59.2 million in the same period a year earlier.

The company attributed growth mainly to telehealth revenue from the Lemonaid Health acquisition, as well as higher sales from its 23andMe+ subscription service. Revenues were lower in other areas of 23andMe’s consumer and research services, though the firm did not provide specific financial details here.

For the three months ended June 30, 23andMe reported a net loss of $89.5 million, or $.20 per share, more than double the FY2022 Q1 loss of $42.0 million, or $.25 per share. The firm used approximately 446.5 million weighted-average shares to calculate per-share loss in the recently completed quarter compared to about 168.2 million weighted-average shares a year ago. 23andMe went public in June 2021 through a merger with a special purpose acquisition company.

R&D expenses totaled $52 million in Q1, up 18 percent from $44.2 million a year earlier. The company’s SG&A expenses grew 125 percent to $63 million from $28 million year over year.

As of June 30, the firm had $479.4 million in cash plus $1.6 million in restricted cash.

23andMe added approximately 300,000 new customers to its personal genomics service in Q1, bringing its total number of genotyped customers to 13.1 million.

The company released new genetic reports on glaucoma, psoriasis, and rosacea for its 23andMe+ subscription service during Q1 and now has more than 60 condition-specific reports available.

23andMe has no immediate plans to offer whole-genome sequencing analysis, even as some startups tout WGS rather than microarrays as the future of consumer genomics.

“For the majority of the population … they are not going to learn anything additional from a whole genome, but it’s substantially more expensive,” Wojcicki said.

In its financial release, the firm confirmed earlier guidance of $260 million to $280 million in revenues for fiscal year 2023, with a net loss of $350 million to $370 million. This includes a full year of revenue from telehealth.

Consumer services, including personal genomics services and now telehealth, represented 87 percent of the revenue total for Q1. The balance of revenue was the result of research services connected to a collaboration with GlaxoSmithKline.

23andMe said in January that it will receive a $50 million payment from GSK after the British pharmaceutical giant opted to extend their drug target-discovery collaboration for a fifth and final year, until July 2023.

In 2018, the companies partnered to use 23andMe’s extensive genotype-phenotype database and base of customers willing to donate personal data to identify targets for personalized therapeutics. As part of the initial deal, GSK made a $300 million equity investment in 23andMe.

23andMe also said early this year that it elected to take a royalty option in a Phase I immuno-oncology antibody program targeting CD96 that stems from the partnership. GSK is fully responsible for the drug’s development in later-stage clinical trials and will handle all development costs going forward, according to the genetic testing company.

Wojcicki said that the GSK program “does open the door to expand research services again.” She said that 23andMe is thinking about what a “post-GSK world” might look like for the company in terms of research services.

Schoch said that therapeutics joins genomic health as “key future growth opportunities.”

23andMe now has a pipeline of more than 50 therapeutic programs, including two in Phase I clinical trials.

This article originally appeared on GenomeWeb. Click here for more information