Spokane Journal of Business

Genetics testing lab here set to relocate

Allele Diagnostics takes Ignite Northwest space

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Allele Diagnostics, a Spokane-based genetics testing company, says it’s in the final stages of moving laboratory operations to the Ignite Northwest Innovation Center, at 120 N. Pine in Spokane’s University District, from its current location at 44 W. Sixth, on the lower South Hill.

The move to the new 6,000-square-foot laboratory will be completed by late October, says Marcelo Morales, the company’s CEO. 

“We’re growing well,” Morales says. “Our test volumes have been increasing. More importantly, the different kinds of services we offer are increasing, so we needed a bigger footprint.” 

The Ignite Northwest Innovation Center is home to the Washington State University Applied Sciences Laboratory, Novion Technologies, and other life science startup companies. 

“Ignite has a great wet lab space, great office space, and has an incubator feel,” Morales says. “That’s something we want to be a part of, especially as we grow the life sciences community in Spokane. The Ignite Innovation Center fit where we want to go.” 

Morales launched Allele Diagnostics in March 2015, after he stepped down from the CEO position at Jubilant HollisterStier Contract & Manufacturing Services here, joined by former employees of health technology services provider PerkinsElmer Inc., the Waltham, Mass.-based company that acquired Spokane-based Signature Genomics in 2010. 

According to Morales, Allele Diagnostics has several lines of business that fill a void left when PerkinsElmer shut down the former Signature Genomics operations.

“We have three business units that we’ve created this year,” he says.

One business unit performs genetics testing for hospitals and labs, and another business unit provides contracted advisory support through which the company works on projects in collaboration with other organizations on gene lists and creating gene panels, he says. A third business unit provides contracted research and development. The company works with hospitals across the country, but its biggest accounts are with companies on the East Coast.

Allele Diagnostics currently has 12 employees, and according to Morales, the company likely will be hiring more next year. 

“We have a few deals finalizing now, and when they materialize, this will result in hiring,” he says. “We’ll be adding team members strategically.”

The future of Allele Diagnostics lies in staying ahead of the curve in a highly competitive market where the science changes rapidly, Morales says. 

The company is collaborating with Harvard University and a couple of institutions on the West Coast to implement a rapid test targeted toward pathology. 

One area in which Allele is working is in the field of urology, where the company is developing novel tests that will help urologists and nephrologists learn results much faster than current genetic testing permits. 

The company also has projects in the areas of developmental delay, autism, and intellectual disorders, among others. It’s organizing genetic panels that enable doctors to perform rapid diagnosis with noninvasive means, such as tissue from the mouth and external sources of skin such as the heel of the foot. 

Allele Diagnostics competes against some of the larger labs, Morales says, but he adds that Allele is a specialized laboratory at doing genetic testing, and its competitors are mostly generalists

“We understand the genetic area intimately well, and we’re fast. We are the fastest lab in the kind of tests that we do by a wide margin.” Morales asserts. “We also compete against other specialized testing companies, but then with the specific assays we develop, we’re in our own niche and we don’t have a lot of competitors in this core area that we do.” 

Allele Diagnostics currently has a two-day turn around for its microarray testing, he says.

Allele is focusing on organic growth and international and domestic marketing and also is considering partnership opportunities as they arise. Allele Diagnostics is self-funding and Morales is involved in venture creation through A4 Ventures LLC, a fund that he developed and that will launch Series A venture capital fundraising in the new year. The name refers to the class of preferred stock sold to investors in exchange for their investment.

“The interest is there. It’s always a question of valuation and dilution. How much do we want to involve outside parties? That’s a question we’re attempting to answer now,” Morales says. “We’ve been approached by a couple of parties that want an interest in Allele or one of the other companies. We’re going to evaluate all that for our funding priorities for 2017. It’s nice to see that interest.” 

Morales says that he will be having conversations with interested parties at the end of this calendar year and by early spring next year will begin the Series A fundraising effort. 

“In our first year, we reached our financial projections and we’re looking strong,” Morales says. “We’re still in startup mode and things are getting very exciting for Allele and A4.”

  • Chris Street

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Chris received his bachelor’s and master’s degrees from the University of Texas. Previously Street wrote for Men’s Fitness, worked in the Texas oil fields, and served as a research assistant investigating banks for a private investment group. Assignments for the Journal of Business range from healthcare and technology to finance. A graduate of the United States Army Infantry School in Fort Benning, Georgia, Chris enjoys reading in his spare time. A few of his favorite authors include Pearl S. Buck, Truman Capote, Robert Sapolsky, C.J. Chivers and Tom Wainwright.

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