Fertility startup Kindbody picks up Phosphorus Labs to offer in-house genetic testing

Fertility-focused company Kindbody plans to bring genetic testing in-house by scooping up Phosphorus Labs.

As part of the deal, the genomics company's geneticists and lab technicians will join Kindbody as its new KindLabs division, the company announced Tuesday. Kindbody also picks up Phosphorus’s 8,000-square-foot state-of-the-art reference laboratory in Secaucus, New Jersey, to offer in-house genetic testing and carrier screening to its patients later this year.

Kindbody did not disclose financial details of the deal.

It marks Kindbody's second acquisition so far in 2022. Earlier this year, Kindbody picked up fertility network Vios Fertility Institute, doubling its national clinic footprint. Kindbody now has 28 clinics across the company and a valuation of $1.2 billion, according to the company.

Founded in 2018, Kindbody offers virtual, at-home and in-person services for fertility and family building including in vitro fertilization, genetic testing, surrogacy services and adoption.

Molecular biologist Alexander Bisignano and geneticist Santiago Munne, Ph.D., founded Phosphorus Labs in 2016 as a spinoff of Recombine. The company offers genomics software as a service for laboratories and hospitals. Bisignano and Munne sold the commercial assets of Recombine, a reproductive genetics company, to CooperSurgical in a deal valued at $85 million. 

Having built a verticalized genetic testing platform, from wet lab chemistry to software and bioinformatics, Phosphorus provides comprehensive, medical-grade genetic tests at price points that help democratize access to genomic information, according to the company.

“In addition to providing an opportunity to bring existing diagnostic testing in-house, KindLabs enables us to further our mission to control costs and improve patient experience and outcomes by developing and integrating new diagnostic solutions," said Dean Morbeck, Ph.D., Kindbody's chief scientific officer, in a statement.

Prior to the acquisition, Kindbody outsourced pre-implantation genetic testing for aneuploidy and expanded carrier screening.

The business of fertility treatments is soaring, with analysts expecting the industry to reach $41 billion by 2026, fueled, in part, by the fact that 1 in 8 couples have trouble getting pregnant or sustaining a pregnancy, according to Centers for Disease Control and Prevention data.

And the sector has attracted big investment dollars. In 2021, fertility support startups in the U.S. raised $345 million in venture capital, up 35% from $254 million in 2020, according to data from Rock Health, a venture fund dedicated to digital health. Funding has more than doubled since 2019 when companies in the fertility support market raised $133 million.

About a year ago, the company banked $62 million in series C funding and has raised about $150 million to date. The company provides fertility benefits to more than 80 employers, covering more than 450,000 lives. 

Kindbody provides care navigation as well as care delivery. Patients can access those services at the company’s own clinics, mobile clinics or through its partner clinics.

The startup also began offering at-home fertility hormone test kits for women and men in January.

As the owner and operator of fertility clinics, Kindbody says it can save employers 25% to 40% by contracting directly with them to provide virtual and in-person fertility and family-building care to their employees.