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Biotechnology

Chinese 'baby editing' scientist retreats from flagship company

Co-founder of Direct Genomics replaces He Jiankui as chairman and buys out stake

He Jiankui in the Shenzhen lab of Direct Genomics in 2016: The company is the most prominent of at least eight Chinese companies in which He was involved as an investor or executive.   © Getty Images

HONG KONG -- He Jiankui, the scientist whose unprecedented editing of the genes of Chinese babies shocked the world medical community last year, has cut ties with his flagship private company, Direct Genomics Biotechnology.

He is now under police investigation in China after a preliminary inquiry found in January that he had breached regulations and committed forgery in raising funds and organizing the secretive project involving the gene-editing tool CRISPR and intended to give the babies immunity from human immunodeficiency virus (HIV). The Southern University of Science and Technology in Shenzhen fired He from his teaching and research position at the school.

Shenzhen-based Direct Genomics, which has been developing devices to sequence single molecules of DNA, is the most prominent of at least eight Chinese companies in which He has been involved as an investor or executive in the past year. With support from the Shenzhen government, He founded Direct Genomics in 2012 to commercialize technologies he had worked on as a protégé of Stanford University bioengineering professor Stephen Quake.

Direct Genomics received some 40 million yuan ($5.8 million) in subsidies from the city, according to the government-owned Shenzhen Daily newspaper. It has also raised hundreds of millions of yuan from investors including Shenzhen's Cosun Venture Capital, copper producer Amer International Group and Tsinghua University's investment affiliate.

Direct Genomics officials say He last month yielded his one-third stake in the company that made him the top shareholder. He has given up his chairmanship of the company in favor of co-founder Yan Qin, who has also taken his place as largest stockholder, according to company records. He is no longer a director of the company. The value of his stock sale has not been disclosed. 

"By severing ties now, the company hopes to avoid further damage to its reputation," said Eben Kirksey, a professor with Australia's Deakin University who recently interviewed company officials as part of his research for a book about gene editing. "Direct Genomics claims to have not been involved in his CRISPR experiment and the staff say that they did not even know that it was being planned."

Quake, who had been listed by Direct Genomics for years as member of its scientific advisory board, denied through a spokesperson to the Nikkei Asian Review that he had ever been directly involved with the company after the experiment became public. Nobel Prize-winning genetic researcher Craig Mello of the University of Massachusetts later told The Associated Press he resigned from Direct Genomics' advisory board in December.

Kirksey expressed doubt that Direct Genomics' prospects will improve much with He out of the picture. "The genomics market is already very crowded in China," he said. "Even under new leadership, Direct Genomics will still be trying to develop the same unproven DNA sequencing technology."

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