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The last woolly mammoths on Earth had disastrous DNA – Livescience.com

Posted: February 14, 2020 at 3:46 am

Dwarf woolly mammoths that lived on Siberia's Wrangel Island until about 4,000 years ago were plagued by genetic problems, carrying DNA that increased their risk of diabetes, developmental defects and low sperm count, a new study finds.

These mammoths couldn't even smell flowers, the researchers reported.

"I have never been to Wrangel Island, but I am told by people who have that in the springtime, it's just basically covered in flowers," study lead researcher Vincent Lynch, an assistant professor of biological sciences at the University at Buffalo in New York, told Live Science. "[The mammoths] probably couldn't smell any of that."

Related: Mammoth resurrection: 11 hurdles to bringing back an ice age beast

Wrangel Island is a peculiarity. The vast majority of woolly mammoths died out at the end of the last ice age, about 10,500 years ago. But because of rising sea levels, a population of woolly mammoths became trapped on Wrangel Island and continued living there until their demise about 3,700 years ago. This population was so isolated and so small that it didn't have much genetic diversity, the researchers wrote in the new study.

Without genetic diversity, harmful genetic mutations likely accumulated as these woolly mammoths inbred, and this "may have contributed to their extinction," the researchers wrote in the study.

The team made the discovery by comparing the DNA of one Wrangel Island mammoth to that of three Asian elephants and two other woolly mammoths that lived in larger populations on the mainland.

"We were lucky in that someone had already sequenced the [Wrangel mammoth's] genome," Lynch said. "So, we just went to a database and downloaded it."

After comparing the mammoths' and elephants' genomes, the researchers found several genetic mutations that were unique to the Wrangel Island population. The team had a company synthesize these tweaked genes; then, the researchers popped those genes into elephant cells in petri dishes. These experiments allowed the researchers to analyze whether the proteins expressed by the Wrangel Island mammoth's genes carried out their duties correctly, by sending the right signals, for instance, in the elephant cells.

The team tested genes involved in neurological development, male fertility, insulin signaling and sense of smell. In a nutshell, the Wrangel Island mammoths were not very healthy, the researchers found, as none of those genes carried out their tasks correctly.

That said, the study looked at only one Wrangel Island mammoth, so it's possible that this individual's comrades didn't have similar genes. But "it's probably unlikely that it was just this one individual that had these defects," Lynch said.

In fact, the case of the Wrangel Island mammoths is a cautionary tale about what can happen to a population that is too small and therefore lacks genetic diversity, he said.

The findings build on those from a study published in 2017 in the journal PLOS Genetics that found that the Wrangel Island mammoth population was accumulating damaging mutations.

The new study was published online Feb. 7 in the journal Genome Biology and Evolution.

Originally published on Live Science.

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How to turn racists genetic arguments against them – The Irish Times

Posted: February 14, 2020 at 3:46 am

It was funny once. The perfectly square bit of dirt on the window. The shocked reactions of Craggy Islands Chinese community. The local farmer who doesnt have much time to be a racist, because he just likes to have a cup of tea in the evening. The feckin Greeks

Dermot Morgans finest televisual moment that evocation of Nazi speech-making in front of the greatest window in comedy is perhaps a little less funny now that prime minsters or presidents of Hungary, Turkey, the United Kingdom and the United States are happy and comfortable to spout racist statements, and not merely get away with it but be applauded for it by their supporters.

How have we reached this point? Its the very question asked by geneticist and broadcaster Dr Adam Rutherford. Hes the Rutherford in the BBCs popular radio programme The Curious Cases of Rutherford and Fry, in which he and Dr Hannah Fry try to solve listeners scientific queries.

In the case of the resurgence of publicly acceptable racism, Rutherford decided that a radio show was insufficient and that a book would be needed. How to Argue with a Racist is published this week, and Rutherford will be delivering a lecture on the subject during the Northern Ireland Science Festival.

So, how did we get back here? I find myself asking the same question, Rutherford says. I find myself in lectures thinking how strange it is that Im now talking about this, because these are mostly questions that were parked, in my field genetics years ago. Maybe decades ago. And we keep discovering interesting things about evolution and population differences, and migration, and so on, but the question of how race as a concept relates to biological diversity, that ended a while back.

Having these conversations in the academy is one thing, but as someone who tries to communicate science, to talk about it, as a broadcaster and as a writer, I found I was suddenly having very different conversations. Conversations about race, when we were talking about ancestry In some ways, science has failed to convey to the public what is correct, and so I want to equip people with what current scientific thinking is, so that when the question comes up, they have the tools to respond. To say, Yes, there hasnt been a white man in the Olympic 100m final since 1980, but no thats not because of any lack of African-American ancestry.

Its precisely that sort of casual, inauspicious racism that Rutherford looks to quash with his book. The idea that Olympic athletes with African heritage are somehow better because their genes are imbued with extra strength is rubbish, he says. For a kick-off, using athletes as a test sample is a daft idea because anyone with the sort of genetic gifts that allow them to perform at the highest level is a poor sample of what a broader population is like. Beyond that, theres a simpler rebuttal if those with African heritage are inherently genetically better at running very quickly than others, then where are the Olympic 100m champions from South America, Europe or elsewhere with populations that can trace heritage to Africa?

Besides, tracing your genetic lineage in that manner, looking for secrets and answers to why you are so underprivileged compared with others, is a nonsense, says Rutherford. I do think that part of the change in culture which means I kind of had to write this book is to do with the rise of nationalism and the more open discussion of race. Certainly there are more open discussions of public racism than at any point I can remember in my lifetime. There are other factors, though, such as the rise in genetic ancestry testing kits. Now, theyre not pernicious in themselves, but I argue that they have fostered a misunderstanding of what genetics means, and specifically in the form of a sort of reversion to essentialism. So a notion that were determined by our genes and our ancestry, which as a geneticist I just dont think are scientifically valid nor verifiable to the extent that people adopt them.

So, when you take one of these tests and it comes back saying that youre 10 per cent Swedish, or 15 per cent Irish, these are very broad strokes, that are not scientifically meaningless, but they are of only trivial relevance. But people attribute very great significance to them. For instance, I sometimes talk about the fact that, genetically speaking, there is no such coherent ancestral group as Celts. But try telling that to an audience in Glasgow and see what happens.

Over in Ireland youve got some of the best genetic genealogists in the world, people like Dan Bradley [head of the school of genetics at Trinity College Dublin] who has been tracking the story of the Irish for years, and thats really important work, its important to understand the movement of peoples and the migration of peoples. But theyre always complex. Ancestry is a matted web, not linear family trees.

For example, I have a friend who told me that hes descended from Niall of the Nine Hostages, and they can trace their ancestry back to him. Well, theres two things about that. One, no one is actually really sure if Niall of the Nine Hostages existed, which is problematic for a starter.

The second thing, though, is that if he did exist, he lived in the fourth or fifth century, and thats a date which comes before the isopoint, which is the time at which everyone in Europe is descended from everyone else. So if Niall did exist, and if my friend Bill is directly descended from him, then so too am I. And so are you. And so is a guy in southern Italy, and in Turkey, and literally everyone else in Europe. So if you can attach some kind of tribal identity to that, that idea that youre descended from some fifth-century Irish king, well everyone else is too.

This is a relatively recent revelation. One that has the power to stun those who claim kinship with any royal lineage, or who might have notions of racial purity. The simple, genetic, fact is that your family tree isnt a neat family tree at all. Its more like an overgrown shrub, especially the farther back you go. And because everyone elses is, too, it means that the family shrubs intertwine and merge until, once you go back a surprisingly few generations, were all related to everyone else.

Thus the late actor Christopher Lees claim to be directly descended from Charlemagne is accurate, but also meaningless. Not everyone can prove it using family trees. Christopher Lee could, because he was the descendent of an Italian contessa, so they had the paper trail of her family going back. The whole Danny Dyer story, which showed that he was a direct descendent of Edward III, they were able to paper-trail that too, and very few people can actually do that, but I calculated out a mathematical proof that anyone with long-standing English heritage is also 100 per cent descended from Edward III.

At which point I suggest that we should use our now undisputed and mathematically proven royal lineage to, shall we say, take back control, but Rutherford politely declines my invitation to insurrection. The point is, of course, more profound than working out where you stand in line for a throne. Its the fact that every white supremacist has, if you trace their genetic code back, African ancestry. Every Nazi has Jewish heritage. Every Briton is a mish-mash of European bloodlines.

The problem, of course, is that while all of this science is correct and provable, its also useless in the face of racism. As someone once said: You can argue with a racist; you can argue with a Labrador retriever, too, for all the good it will do you.

Rutherford agrees, but says theres a more important battle, on two fronts, to be fought. Part of the book discusses actual neo-Nazis and white supremacists, because they are obsessed with genetics. And their misunderstanding of genetics makes them think that they can prove some sort of racial purity, which is a nonsense. Arguing with those guys using science is a demonstration of the old Jonathan Swift maxim that you cant reason someone out of a position that they didnt reason themselves into, he says.

Who Im really interested in reaching, though, are those who arent racists, and who dont think like that. But because of relying on stereotypes, or myths, or the cultural sphere that says that race is real, or that some factors are biologically encoded and that those factors segregate by race, I want those discussions to be the ones that are informed by science. Because those people arent fundamentally racist, so when youre armed with facts, and youre armed with a knowledge of history, then I think that is your best route to change. Science is a powerful ally, its the best ally we have, I think. But whats the Bob Dylan line? I know my song well before I start singing.

One of the ideas I explore is that scientists need to get more involved. Its no longer good enough to simply say: Heres the data and let society decide. Racists have no such compunctions, and will use every tool at their disposal to spread their message. So if we. as scientists, sit back and say, Hey, its just the data and I dont know what the political ramifications are, thats for others to discuss, then were volunteering ourselves to defeat, and for our voices to be silenced in favour of populist, emotive arguments, and thats the political landscape in which we now live.

Racism isnt wrong because its drawn from and based on a misunderstanding, or specious scientific ideas. Racism is wrong because its an affront to basic human dignity. What Im saying is, if you want to be a racist, fine, fill your boots, go ahead, but you cant have my scientific tools, my weapons, to justify your position.

How to Argue with a Racist by Adam Rutherford is published by Orion. Northern Ireland Science Festival runs February 13th-23rd. nisciencefestival.com

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ACSM Tackles Myth on Genetics and Heart Disease as Part of American Heart Month – Newswise

Posted: February 14, 2020 at 3:46 am

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Newswise (Indianapolis, IN) Nearly half of all U.S. adults have some type of cardiovascular disease. Its a heartbreaking statistic literally and figuratively. People often believe their risk for heart disease cannot be reduced if they have a genetic predisposition. In honor of American Heart Month, the American College of Sports Medicine (ACSM) and ACSM Fellow Beth A. Taylor, Ph.D., have teamed up to shatter this heart myth.

The truth about the heritability (or genetic component) of heart disease is a glass far more full than empty, as long as we look at it accurately, says Dr. Taylor, associate professor of kinesiology at the University of Connecticut and the director of exercise physiology research at Hartford Hospital.

Genetics do play a significant role in increasing heart disease risk. Research shows that individuals at high genetic risk have a 91% higher chance of experiencing a cardiac event, yet that risk can be cut nearly in half by adopting healthy lifestyles.

We may have genes that predispose us to cardiovascular disease, but when, how and to what extent those genes express themselves is highly influenced by lifestyle, says Dr. Taylor. Being more physically active, aiming for a healthy weight, eating a heart healthy diet and avoiding smoking can improve heart health and reduce the risk of coronary events by 46% for high genetic risk individuals.

The outlook looks even better when considering being healthy across the lifespan rather than at a single age. The Framingham Heart Study, a project of Boston University and the National Heart, Lung and Blood Institute (NHLBI), has sought to identify common factors contributing to cardiovascular disease (CVD) by following CVD development in three generations of participants.

Dr. Taylor adds, When those three generations of the Framingham Heart Study were reviewed, investigators concluded that the heritability of ideal cardiovascular health was only 13-18%, with health behaviors and lifestyle factors being much more influential.

She says other studies have found that adhering to just four out of five of healthy lifestyle factors (e.g., avoiding smoking and excessive alcohol intake, performing 30 or more minutes a day of moderate-to-vigorous physical activity, eating a heart healthy diet) increased the likelihood of living free of cardiovascular disease, as well as cancer and Type 2 diabetes, by more than 10 years in women and seven years in men.

For Dr. Taylor, the take-home message is simple. You cant completely cure a broken heart; however, you can make it better or worse based on your lifestyle. The choice is yours!

Find more heart health resources from ACSM at https://www.acsm.org/read-research/trending-topics-resource-pages/heart-health-resources.

# # #

About the American College of Sports Medicine

The American College of Sports Medicine is the largest sports medicine and exercise science organization in the world. More than 50,000 international, national and regional members and certified professionals are dedicated to advancing and integrating scientific research to provide educational and practical applications of exercise science and sports medicine. More details at acsm.org.

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Seattle Genetics’ Experimental Breast Cancer Drug Receives Priority Review From the FDA – Motley Fool

Posted: February 14, 2020 at 3:46 am

On Thursday, Seattle Genetics(NASDAQ:SGEN) shared some good news regarding an experimental breast cancer drug called tucatinib. The U.S. Food and Drug Administration (FDA) will give tucatinib's new drug application a priority review.

Patients with HER2-positive breast cancer tumors that keep growing after treatment multiple rounds of standard care could have another treatment option this summer.

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Instead of the standard 10-month process, the FDA granted tucatinib a priority review that will shave four months off the timeline. The agency's expected to announce a decision on or before Aug. 20, 2020.

The priority review the FDA gives tucatinib will most likely result in a positive approval decision on or before the FDA's action date. During the HER2Climb study that's supporting Seattle Genetics' new drug application, adding tucatinib to a standard regimen of chemotherapy plus Herceptin reduced patients' risk of death significantly. Two years after beginning treatment, 44.9% of patients given tucatinib plus standard care were still alive compared to a 26.6% survival rate for patients given standard care alone.

Roughly half of all patients with HER2-positive breast cancer develop brain tumors that are incredibly difficult to treat. Seattle Genetics' potential new cancer therapy appears to give this underserved population a fighting chance for long-term survival. During the HER2Climb trial, none of the patients with brain metastases given standard care survived past one year without signs of their disease worsening compared to an impressive 24.9% of those treated with the tucatinib-containing regimen.

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Experts: Corporations Could Do Terrible Things With Your DNA – Futurism

Posted: February 14, 2020 at 3:46 am

Once again, experts are warning that using a consumer DNA test is effectively signing away any notion of your genetic privacy.

While it can be fun to learn about your ancestry by spitting in a tube and letting some startup analyze your genome, it also potentially makes you vulnerable to discrimination or unfair treatment based on what your genes reveal about your health and medical conditions, KSDK reports.

Its illegal for an employer to discriminate against employees based on genetics employees cant legally be fired if their DNA contains a warning sign for cancer, for example but other powerful groups arent beholden to those laws.

That law does not protect against discrimination in other settings, Consumer reports associate editor Cathy Roberts told KSDK. Some big examples are life insurance companies, long-term care insurance, disability insurance. These insurers can make decisions about your premiums, about your coverage, based on genetic information.

In that regard, regulations that might protect consumers have lagged behind the rate at which these tests have developed and proliferated.

It is kind of a Wild West as far as regulation, Roberts told KSDK.

The privacy concerns surrounding DNA test kits are valid enough that the Department of Defense issued a warning to all of its employees that said not to use them, because doing so places too much trust in whatever DNA test startup they happen to choose.

I would say if theyre really being leery about their employees taking these tests, I would really take heed to that, Parameter Security CEO David Chronister told KSDK.

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Seattle Genetics gets another drug close to the finish line – Endpoints News

Posted: February 14, 2020 at 3:46 am

Seattle Genetics productive streak continues.

After closing out 2019 with its second approved drug a potential blockbuster in Padcev the ADC biotech then presented data showing that Padcev combined with Keytruda may be more effective than Keytruda alone for bladder cancer patients.

And on Thursday, the company announced another drug has been accepted for FDA review and has been given priority status. The drug, tucatinib, is being assessed as part of a combination treatment for locally advanced or metastatic HER2-positive breast cancer. A PDUFA date has been set for August 20, 2020.

The application to market the drug is based on positive progression-free survival and overall survival data from a Phase II trial unveiled in December: Patients given tucatinib lived about 2 months longer without their cancer returning.

Unlike the rest of Seattles pipeline, tucatinib is not anADC, or an antibody-drug conjugate. Once a trendy idea, the concept fell mostly out of the news for years before Seattle Genetics recent success revived interest. The technology essentially uses an antibody as a kind of homing system to guide a cytotoxic drug to the tumor site.

Rather, the drug is a selective tyrosine kinase inhibitor for HER2. It did not come from in-house, but was originally developed by Array BioPharma, who licensed it to Cascadian Therapeutics. Seattle Genetics bought Cascadian for $614 million in 2018.

In addition to tucatinib and Padcev, known chemically as enfortumab vedotin, Seattle Genetics also has a Phase II ADC in collaboration with Genmab and a Phase II ADC in collaboration with Takeda.

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Mexico: Feed prices allow for production growth, genetic focus – FeedNavigator.com

Posted: February 14, 2020 at 3:46 am

The US Department of Agriculture (USDA) released new information regarding feed use and livestock production in Mexico in a report from the Foreign Agricultural Service (FAS) on Friday.

Increasing livestock production in Mexico has been supported by the movement toward vertical integration in production and improved biosecurity, the FAS reported. Stable feed prices and better zoo-sanitary conditions suggest that the expansion will continue.

Feed price consistency has allowed livestock breeders to seek better genetics, the agency said.

Feed prices did slightly fluctuate in the last two quarters of 2019, but industry expects overall grain and feed price stability to prevail through 2020, the agency said. The stability in feed prices as well as steady domestic livestock prices allow producers to focus their operations more on breeding than slaughtering.

In marketing year (MY) 2020, beef production is expected to reach 2.1m metric tons (MT) and consumption is expected to reach 1.9m MT, the FAS said. Industry growth from 2015 through 2019 averaged about 2% annually, despite changes in prices for feed and grains.

The Mexican beef industry has kept a steady pace of investments, adaption of new and improved production practices, as well as improved technology to stimulate the beef production sector, the agency said.

Swine production in MY 2020 is anticipated to be a 20.3m head based on increasing consumer demand and supported by vertical integration of producers, the agency said. Pork production is forecast to reach 1.47m MT.

According to industry studies, pork consumption has increased as a share of domestic consumption from 28% to close to 32%, with poultry retaining the biggest share at over 60%, the agency said.

During the 2018-19 export cycle, Mexicos exports of cattle to the US reached 1.313m animals an increase of 17.6% from the previous year, the FAS said. Trade has been valued at more than $760m.

Trade is expected to continue expanding, if more slowly, during MY 2020, the agency said.

A pilot program has been established to regulate trade and improve zoo-sanitary status in live cattle coming in from Guatemala, the agency said. The agreement emphasizes that cattle to be exported from Guatemala will come from ranches certified by the Ministry of Agriculture of Guatemala (MAGA) as free of bovine tuberculosis and brucellosis, which will be tagged with the Central American Electronic Earring and utilizes radio reference technology.

Personnel from MAGA and the International Regional Agency for Agricultural Health (OIRSA) will verify the fulfillment of a 21-day quarantine of cattle at the ranch of origin or in the feedlots constituted for it, FAS said. Currently, 70 ranches in Guatemala have been certified, and the program is set to run through November 2024.

Beef imports in MY 2020 are expected to increase to 212,000 MT, the agency said. The United States remain the main beef provider to Mexico with 86% market share, followed by Canada with 7.5%, and Nicaragua with 4.7%.

Exports of beef in MY 2020 are forecast to increase by 10% and reach 347,000 MT, the FAS said. Expanding the use of feedlot-based production is one factor supporting the increased exports.

Japan is consolidated as the second most important export market for Mexican beef, comprising 7% of Mexicos beef exports, followed by Hong Kong with 4%, the agency said. For many years, South Korea was the third most important Mexican beef export destination, but now holds the fourth position with 2% of market share.

On the swine side, the forecast for MY 2020 calls for live hog imports of 41,000 head and pork imports of 1m MT, the agency said. Mexico is dependent on imports to meet domestic demand, but imports have been slow based on the countrys economy.

In MY 2020, imports will rise compared to their low in 2019, as pork consumption continues its positive trend and growing exports to China compete with domestic consumption, the FAS reported.Mexico will resume imports from the United States in order to satisfy the domestic demand.

Pork exports are predicted to reach a record 250,000 MT as Mexico focuses on supplying Asian markets, the agency said.

Mexican pork exports have grown considerably through 2019, especially to Japan, the agency said.The trend will continue as the industry is expecting an important growth of exports for 2020, especially to China.

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Promises and perils of using genetic tests to predict risk of disease – The BMJ

Posted: February 14, 2020 at 3:46 am

In determining risk of future disease, Ian Scott and colleagues argue there is little value in genetic testing of asymptomatic people with no family history of disease

Low cost genetic testing is increasingly being used by patients and the public to predict risk of developing disease in asymptomatic people in the hope that more precise risk stratification might facilitate targeted interventions for reducing risk

The proliferation of genetic variants might cause clinicians and citizens to misread their clinical relevance, potentially leading to overestimation of risk, overdiagnosis, and overtreatment

In appraising the value of genetic testing for clinical decision making, consideration must be given to validity, predictive accuracy, clinical utility, potential harms, cost effectiveness, and feasibility of use in routine care

Moving from traditional genetic testing for rare monogenic disorders within families to wider polygenic testing for common diseases in heterogeneous populations requires robust evidence of benefits and harms of this paradigm shift

Increasing numbers of patients and clinicians are undertaking low cost genetic testing in asymptomatic people to identify genetic variants that might predict risk of developing diseases. By early 2018, an estimated one in 25 citizens of the United States had undergone genetic testing, more than double the rate in the previous year.1 Although testing for risk of monogenic diseases such as cystic fibrosis in people with family histories is often appropriate, extending testing for polygenic diseases such as cardiovascular atherosclerosis to people with no family history is problematic and might cause harm.

Tests for approximately 75000 genetic variants are now commercially available from companies such as 23andMe, Navigenics, and deCODE Genetics, which can be ordered on the internet by consumers anywhere in the world and are increasingly advertised in lay media in the US, Canada, Australia, and various European countries.2 These tests aim to predict individual

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Public fears and anxieties over GMOs growing old – The Duquesne Duke

Posted: February 14, 2020 at 3:43 am

2/13/20

Hannah Boucher | Staff Columnist

Mass-produced bananas are dying at an increasingly faster rate and are at risk of one day going extinct.

Genetically modified organisms (GMOs) are not as new of a concept as many would like to believe. While it has been a controversial scientific advancement since the 1970s, when Herbert Boyer and Stanley Cohen invented modern-day genetic engineering, artificial selection has been used to cultivate crops and animals for over 30,000 years.

The misconception that GMOs are dangerous has derived from a misunderstanding of the definition. In fact, agriculture exists because humans selectively bred organisms to cater to their needs. This is the definition of agriculture.

Genetic engineering the true controversial topic falls under the umbrella of genetic modification, which is what has brought society its big, red tomatoes, giant ears of yellow corn and sweet bananas.

The technology used to genetically engineer common produce can also be used on animals and bacteria. Cloning and gene transfer have been successfully carried out in scientific labs, however, these successes have been met with much concern.

While humans possess the power to multiply livestock by the masses, or create an entirely new species in a lab, that does not mean it should be done. These processes violate certain ethical standards because they are seen as being humane which is technically true.

An example of this issue is the banana industry. The Cavendish banana which is actually the second species commercially grown fell victim to Panama disease, a fungus that spreads quickly and kills the entire plant. Bananas are mass produced by corporations such as Dole and Chiquita to appeal to the millions but at a cost.

Scientists are struggling to find a banana plant that carries the gene that fights the disease to breed with the Cavendish. Banana plants are now dying at a faster rate than can be produced, meaning that they may go extinct. This is not the first occurrence of this issue either. In the 1950s, the first species of banana, the Gros Michael, was completely wiped out from a strain of the Panama disease.

The main difference between normal cultivation and monoculture is that monoculture decreases the variability within a population. Cultivation has been successfully practiced for thousands of years. Some of the most commonly consumed vegetables are actually all derived from the same species. Broccoli, cabbage, kale, brussel sprouts and a few other popular greens are all cultivated forms of Brassica oleracea, or, wild cabbage.

Although there are major risks associated with selective breeding, there are also major benefits. By selective the most favorable traits within a species, the fitness, or the species ability to produce viable offspring, increases.

This has helped the farming industry keep up with the growing pool of consumers that continues to increase as the population rises. Certain modifications reduce the need for pesticides and increase the overall crop yield, which also increases the overall income for farmers.

Another big issue with GMOs is that not all of the health risks are currently known. Before any new modified products are released to consumers, they must undergo a series of tests assessing the possible hazards posed from consumption. However, the regulations put in place by the Center for Food Safety [CFS] require all products that contain genetically engineered ingredients to be clearly labeled so people are aware of its contents.

It is important to consider though that many technological advancements pose risks to the general public. It is not the act of genetically manipulating an organism that is the problem, but rather the lack of consideration of the possible issues. Scientists must be careful not to cross a line because they hold the fate of species in their hands. There is nothing to fear when it comes to GMOs. Civilization would be nonexistent without the cultivation of crops and animals.

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Twist Bioscience Pursues Growth at All Costs. How Long Will Investors Tolerate It? – Motley Fool

Posted: February 14, 2020 at 3:43 am

In recent years, promising start-ups have faced almost no obstacles to raising capital, so long as they pursued growth at all costs. Investors accepted significant losses in the present on the premise that these would translate to incredible market share in the future. The environment of easy money created many questionable valuations (see: WeWork), and even rare instances of outright fraud (see: Theranos).

But the market shifted in 2019. Investors are thinking more objectively about the stories presented by start-ups and emerging companies, and are much more interested in profitable growth, or at least progress toward it, than empty promises of a big payoff down the road.

While tech companies such as WeWork, Uber, Slack Technologies, and others have been hit by this newfound skepticism, even swearing off the growth-at-all-costs mantra of years past, the field of synthetic biology has yet to (publicly) face its reckoning. If and when it does, Twist Bioscience (NASDAQ:TWST) might be the first to fall.

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Twist Bioscience wields the leading technology platform for synthesizing DNA, which can be used in genetic engineering experiments to create reference probes for DNA sequencing applications and to store digital data. The company is often associated with synthetic biology, or engineered biology, which is the intentional design of living technologies with reproducible functionality.

The company recently reported fiscal first-quarter 2020 operating results for the three-month period ending Dec. 31, and announced it had settled a long-standing legal dispute with Agilent Technologies. The settlement avoided a costly jury trial, but cost the synthetic DNA pioneer $22.5 million. Investors were just pleased to be rid of the headache, and to have removed the largest source of uncertainty hanging over the stock. Shares soared on the announcement.

The immediate interpretation of this event is that the settlement will allow Twist Bioscience and Wall Street to focus entirely on growth and financial performance. A deeper dive, however, suggests investors might want to be careful what they wish for.

While the company touts impressive growth in revenue and gross profit, that means little when losses attributed to shareholders are growing even faster in absolute dollar amounts. Operating losses have now grown sequentially for eight consecutive quarters.

Metric

Fiscal Q1 2020

Fiscal Q1 2019

Change (YoY)

Revenue

$17.2 million

$11.5 million

49%

Gross profit

$3.3 million

($0.4 million)

N/A

Operating expenses

$59.2 million

$22.5 million

163%

Operating expenses excluding Agilent settlement

$36.7 million

$22.5 million

63%

Operating income

($55.8 million)

($22.9 million)

N/A

Operating income excluding Agilent settlement

($33.3 million)

($22.9 million)

N/A

Data source: Twist Bioscience press release. YoY = Year over Year.

When the Agilent legal settlement is excluded, normal day-to-day operations resulted in fiscal first-quarter 2020 operating expenses of $36.7 million. That was $14.2 million greater than in the year-ago period, which easily offset the $3.7 million improvement in gross profit in that span.

Swelling losses have had a real impact on shareholders: dilution. Twist Bioscience has tapped into the public markets multiple times since conducting its initial public offering (IPO) in late 2018, including an offering in late January that raised $48.2 million in net proceeds. Investors now know that was largely conducted to pay for the Agilent legal settlement, which will consume roughly half of the proceeds.

In a little over 15 months as a publicly traded company, multiple stock offerings from Twist Bioscience have increased the number of shares outstanding from 26.6 million to 35.4 million. That's an increase of 33%. Considering the business reported $103 million in cash at the end of December and expects to report a net loss of at least $129.5 million in fiscal 2020, investors should expect additional public stock offerings or convertible debt offerings -- and, therefore, additional dilution -- in the near future.

It might be tempting to think the company could just flip a switch and focus on profitable growth, but a closer look at SEC filings suggests that might not be possible.

Image source: Getty Images

Investors know Twist Bioscience as the company that makes synthetic DNA. It serves industrial and pharmaceutical customers that require (relatively) large amounts of DNA for high-throughput genetic engineering research. It's by far the best in the industry -- even supplying some of its competitors.

However, most of the company's growth and profits come from an entirely different market: next-generation sequencing (NGS) tools. In fact, NGS tools are expected to generate nearly as much revenue in fiscal 2020 as synthetic genes. It's a bit ironic that the company known for writing DNA is increasingly dependent on companies that read DNA, but there are two primary reasons for that.

First, despite all of the hype, the market for synthetic DNA is simply not very large and isn't very profitable (if it's profitable at all). Roughly 25% of the company's synthetic gene revenue in fiscal 2020 will come from a single customer. It's also worth noting that the business didn't begin generating gross profit until it ramped up sales of NGS tools.

Second, Twist Bioscience's technology platform is well suited for designing NGS tools. The company uses its ability to synthesize accurate DNA sequences to create high-quality target enrichment probes, which allow researchers to detect specific genetic sequences in biological samples.

But investors cannot conflate early success in the NGS market with being on the path to profitability. Sales of target enrichment probes are far from sufficient to offset losses from the remainder of the business. The company expects roughly half of fiscal full-year 2020 revenue to come from money-losing or low-margin products related to synthetic genes; the other half will comprise NGS tools.

Revenue Category

Fiscal Full-Year 2020 Revenue Guidance

Fiscal Full-Year 2019 Revenue, Actual

Change (YoY)

Synthetic genes and related products

$42 million to $43 million

$33.3 million

26% to 29%

NGS tools

$37 million to $40 million

$21.0 million

67% to 76%

Biopharma collaboration

$1 million

N/A

N/A

Total revenue

$80 million to $84 million

$54.4 million

47% to 54%

Data source: Twist Bioscience. YoY = Year over Year.

Despite impressive revenue growth, Twist Bioscience expects to report a net loss of at least $107 million from day-to-day operations in the current fiscal year. That's exactly the same net loss reported in fiscal 2019, and it jumps to at least $129.5 million when the Agilent legal settlement is included.

That also suggests that Twist Bioscience might be stuck financially for the foreseeable future. In order toremain relevant in a money-losing market for synthetic genes and a very competitive market for NGS tools, it must spend significant sums of money on sales and marketing expenses, which are the main driver of operating losses.

In other words, although NGS products are responsible for most of the company's gross profit, they're also responsible for much of the company's operating losses. If the company stopped marketing its products as heavily in an attempt to pare losses, then it might not grow quickly enough to achieve breakeven operations. That suggests Twist Bioscience is pursuing growth at all costs because it doesn't really have any other options. That's not a very secure position for individual investors.

Image source: Getty Images

Investors might be drawn to Twist Bioscience because of its industry-leading technology platform for synthesizing DNA. It can create products today for high-throughput genetic engineering experiments or NGS tools, while tomorrow's opportunities could span digital data storage in DNA or rational design of biologic drugs.

But, to be blunt, publicly traded synthetic biology companies have a downright awful track record of living up to their lofty promises. The best product from the field to date has been hype, and that's led to terrible outcomes for individual investors who invested on storytelling alone. Shares of Twist Bioscience have rewarded investors with solid gains since the IPO, but swelling losses make it reasonable to question if and when the sentiment will turn negative.

More:
Twist Bioscience Pursues Growth at All Costs. How Long Will Investors Tolerate It? - Motley Fool

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