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Agilent Aims to Upset The GT Interview

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By Adrienne J. Burke

This story has been corrected from a previous version, which stated that Agilent sold 20,000 microarrays in a year. The correct figure is that the company sold 20,000 microarrays in the last quarter. -- GT editor.

When most people rattle off lists of the major life sciences instrument companies, billion-dollar businesses ABI, Amersham, and PerkinElmer usually come long before the four-year-old Hewlett-Packard spinoff Agilent Technologies rolls off anybody’s tongue. Chris van Ingen, senior vice president and general manager for Agilent’s Life Sciences and Chemical Analysis, says the company even added Life Sciences to the business unit’s name because so many customers failed to recognize the company as a market player.

In fact, Agilent’s LSCA unit, a $1.12 billion business, could hold its own against any of those other big equipment companies. Granted, 60 percent of revenues come from the chemical analysis market — food, petroleum, environmental, forensics, and homeland security applications. But on the life sciences side, van Ingen ranks his group number one in the microfluidics and liquid chromatography markets, fourth in mass spec, and number two in gene expression.

In that last category, Agilent is posing an increasingly strong threat to the first placeholder, Affymetrix. Van Ingen, an analytical chemist who began his Agilent career as an HP mass spec sales engineer in the Netherlands, says his group shipped 20,000 microarray chips in the last quarter, and placed more than 200 scanners in the last two years with customers around the globe. Agilent made waves this year when it began offering the whole genome on two chips.

Then, in early August, prompted by a statement from an unexpected competitor in the chip arena — Applied Biosystems — of its plans to offer a single whole-genome microarray product, Agilent fast-tracked its own announcement. The company plans to unveil an “open platform” 1” by 3” chip containing more than 36,000 genes by year’s end.

Van Ingen, 57, who has been in his position since May 2001, sat down for a chat with Genome Technology in July at Agilent’s Palo Alto, Calif., facility.

GT: How did your group at Agilent expand from chemical analysis into life sciences?

Van Ingen:We felt it was a growth opportunity and a diversification of the portfolio we had. I still believe that systems biology, doing genomics and proteomics, is really important longer term. Gene expression and protein expression are pretty closely linked. Many people are using the term systems biology and it was eventually an opportunity to tie the two together and improve the learning fundamentally about living organisms.

We basically decided — after going through an exercise looking at our core competencies, technologies, and our ability to win — to focus on two spaces: gene expression and proteomics.

How did you choose those two?

At that time it was a combination of a market opportunity, and also the technology. We did have the inkjet-printing technology … and it looked very promising for the arrays. That’s one of the key reasons we decided to go after gene expression. We thought with the technology we have today and the platform we can win there.

Proteomics was more because of our core competencies. You look at proteomics today and compare that to 10 or 15 years ago in the environmental business: the workflow is the same; the molecules are different. All the things you do in sample preparation, in detection, in data handling are fundamentally the same steps. So it’s a lot closer to our core competencies. I’m a mass spec person by training. I started out an analytical chemist with a mass spectrometry degree and then over time ventured into newer areas.

Moving into gene expression was certainly a completely new area for [us] at the time. Genomics was a whole new area for us. We didn’t have any genomics skills. We had to bring in a lot of people. That required a lot of education, learning, and I think we still do that as an organization. We brought in a fairly significant new skill set in LSCA in the past five years. I would say today we have over 300 people who do have a background in biochemistry.

Let’s talk about the competitive landscape. Who would you name as your top three competitors in gene expression?

Well, if you look at gene expression, without a doubt Affymetrix was first to market 10 years ago. They fundamentally developed part of the market. We were part of that whole process by providing one of the scanners to Affymetrix. The scanner they used in early years was developed by HP, now Agilent. It was a year ago when they cancelled the contract.

In the last five years we’ve really looked at gene expression technology, particularly in the inkjet platform, and felt that with the technology we have and where the market is moving it was a great entry for us into the market. A big part of the market, if you look at the Lehman Brothers report that recently came out, is still the do-it-yourself market. So our focus is truly on the application, developing the best workflow for the customer all the way from the RNA isolation to getting the RNA on the arrays, scanning it, doing the informatics. Making it a simple process to use.

We believe there’s a good opportunity, that with our platform we can develop the economies of scale. We have the ability to truly change how you look at the arrays. That’s the reason we’re in the market. So, the number one competitor is Affy and number two is the opportunity — the homebrew market. And number three is our friends who bought the Motorola business, Amersham.

And who are the top three competitors in proteomics?

Applied Biosystems, Waters, Thermo Electron. The portfolios of companies in many cases are different. In proteomics the key part is mass spec. So if I look at the three competitors certainly based on mass spec and the total offering, those are the three.

We are expanding our mass spec platform. Today we are the leader in single quad LCMS by far. On a similar level we have market share in our GCMS business. Then we have an ion trap we introduced a few years ago and we’re really building record share.

I think we are number four in the mass spec business.

We eventually hope to combine proteomics and gene expression where you can truly look at the systems biology.

If you had to dump everything but one technology, which one would you keep?

We have a major presence in chemical analysis. Those are markets which are not growing at the rate of 20 percent. So our question has been, what do we need to do to improve operational excellence? Over 75 percent of our R&D investments are in gene expression and proteomics, split pretty evenly. We believe that’s where the growth is longer term. That’s the future of our business. We’ll continue to drive the technology to higher sensitivity in proteomics and higher density on the chips.

Will you take your microarrays business into the diagnostics arena?

People are doing research on the chips today to identify what they need to measure for molecular diagnostics. Density is not an issue. It’s the workflow itself and the rigidity of the application.

We might be a tools and maybe a content provider. That may be as far as we would go. I would use the existing infrastructure of the diagnostics business today. For us to become another Roche or Abbott really doesn’t make a lot of sense.

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