Karius is a life sciences company specializing in advanced metagenomic diagnostics to detect pathogens and improve infectious disease care, particularly for immunocompromised patients.
In 2024, Karius secured $100 million in funding. Can you share the story behind this achievement and how you plan to leverage it moving forward?
The funding, officially secured in May, puts Karius in a remarkably strong position in terms of capitalization. It was a successful Series C round led by Khosla Ventures, with notable participation from new investors like 5AM Ventures and Gilde Healthcare, alongside Softbank, General Catalyst, and HBM Partners. This achievement is particularly significant given the challenging financing environment for life sciences companies over the past year. Khosla Ventures, a long-standing investor, strongly supported Karius' mission to make a profound impact on patient care.
The funds will be used strategically, starting with a significant commercial expansion that took place in Q1 of 2024. This expansion increased the commercial team by 30–40% to improve hospital access to the Karius test. Educating hospital personnel across specialties like infectious disease, pulmonology, and hematology-oncology is key to integrating the test into routine practice. Additionally, Karius has benchmarked its growth against leading diagnostics companies like Exact Sciences and Natera, showing growth rates three to four times those of its peers in 2024.
While we are on the topics of financing, would you say that the investment climate for the industry is finally improving?
The life sciences sector has faced a challenging financing landscape, but there are promising signs of recovery. While many predicted a more robust improvement in 2024, the sector has seen an inflection point, albeit less dramatic than hoped. One significant milestone was the successful IPO of Tempus AI, the first diagnostic IPO in nearly three years. This event, widely viewed as a positive market signal, has sparked optimism for 2025.
At Karius, we are encouraged by the broader interest in diagnostics, particularly as our work aligns with the growing recognition of advanced tools like metagenomics.
Our focus remains on leveraging the financing to expand access to our technology, ensuring that more hospitals and physicians can adopt the Karius test and realize its potential across various clinical indications.
What is the current uptake of the Karius Test among US hospitals? And what are your growth strategies for the coming months?
Today, well over 400 hospitals in the United States routinely use the Karius test. While we do not disclose the exact number, our growth strategy focuses on three key areas: adding new hospitals, increasing the number of doctors using the test within existing hospitals, and expanding the range of clinical indications for which the test is utilized. For example, physicians initially using the test for febrile neutropenia may later apply it to conditions like pneumonia, endocarditis, or fever of unknown origin.
Educating hospital staff about the test is a critical component of this strategy. The goal is to build trust and familiarity among physicians, enabling them to incorporate the test into their diagnostic workflows. By doing so, we aim to maximize the impact of the Karius Test on patient outcomes.
How do you address concerns about the upfront costs of the Karius Test for hospitals?
We often discuss cost dynamics with hospitals, emphasizing the expenses already incurred with standard diagnostic workups. Immunocompromised patients admitted for infections typically undergo 15–20 tests in the first week, costing between $10,000 and $20,000. Procedures like bronchoscopies for pneumonia alone can cost thousands of dollars, and these figures exclude hospital stays, additional procedures, and empiric antibiotics.
The Karius Test can provide equivalent or superior diagnostic insights at a fraction of these costs. Through dialogue and evidence from publications, we demonstrate the cost-effectiveness of our test. Most hospitals agree that they spend significantly more on standard diagnostics than the cost of a single Karius Test, making it a compelling solution for improving care while managing budgets.
What does the recently granted FDA Breakthrough Device Designation mean for Karius?
The FDA Breakthrough Designation is an exciting milestone for Karius. It provides an accelerated pathway for regulatory discussions and approvals, enabling more efficient collaboration with the FDA. Our designation specifically applies to using the Karius Test for diagnosing immunocompromised host pneumonia, a condition that hospitalizes,1–2 million patients annually in the U.S.
This designation builds on the American Thoracic Society’s guidelines, which highlight the potential of metagenomic testing for diagnosing pneumonia. Over the next two years, we will work closely with the FDA to advance the test's approval, with the ultimate goal of enabling hospitals nationwide to use the Karius test independently.
Do you plan on international expansion?
Yes, international expansion is a key focus for Karius. Many hospitals worldwide already possess DNA sequencing capabilities, such as Illumina sequencers. Our vision is to create a distributed version of the Karius Test, allowing local sequencing with cloud-based bioinformatics analysis. This approach would enable hospitals in countries like Romania, Spain, and Italy to integrate the Karius Test into their workflows.
While developing this distributed model will require significant effort over the next few years, we are excited about the potential to serve patients globally by making advanced diagnostics more accessible.
How important are collaborations for Karius at this stage?
We have several high-impact partnerships. One notable example is with eGenesis, a leader in xenotransplantation. Karius has been involved in evaluating every xenotransplant patient to date, supporting research into the future of organ transplants using animal-derived organs. Additionally, our collaboration with BARDA DRIVe focuses on expanding the capabilities of the Karius Test for public health and biodefense applications, supported by federal funding.
These partnerships highlight our commitment to advancing cutting-edge science and expanding the use cases for the Karius test in areas like pandemic preparedness and beyond.
Where do you picture Karius one year from now?
By next year, we aim to maintain growth rates of three to four times those of our industry peers, including leaders like Natera and Exact Sciences. Beyond revenue and volume growth, we plan to build on our publication record, which recently surpassed 200 peer-reviewed studies. Key publications from the PICKUP study have already demonstrated the test's clinical impact and cost-effectiveness, providing a strong foundation for broader adoption.
Our focus remains on ensuring that Karius continues to set the standard for innovation and impact in diagnostics. With continued investment in evidence generation and strategic partnerships, we believe 2025 will be another transformative year for the company.
