TWO-SIGMA-G: A New Competitive Gene Set Testing Framework for scRNA-seq Data Accounting for Inter-Gene and Cell-Cell Correlation

We propose TWO-SIGMA-G, a competitive gene set test for scRNA-seq data. TWO-SIGMA-G uses a mixed-effects regression model based on our previously published TWO-SIGMA to test for differential expression at the gene-level. This regression-based model provides flexibility and rigor at the gene-level in (1) handling complex experimental designs, (2) accounting for the correlation between biological replicates, and (3) accommodating the distribution of scRNA-seq data to improve statistical inference. Moreover, TWO-SIGMA-G uses a novel approach to adjust for inter-gene-correlation (IGC) at the set-level to control the set-level false positive rate. Simulations demonstrate that TWO-SIGMA-G preserves type-I error and increases power in the presence of IGC compared to other methods. Application to two datasets identified HIV-associated Interferon pathways in xenograft mice and pathways associated with Alzheimers disease progression in humans.