Premature obituaries and conflicting narratives. Funding constraints and flurries of new product launches. At times over the past year it seemed that array makers themselves didn't know what would happen next in the market, and as 2012 dawns, that appears to still be the case.
Much of the pressure on the market has been directly attributable to the growing availability of next-generation sequencing-based applications, not only to wealthier first adopters but to average researchers, some of whom can at last afford the pricier technology.
Pressure has come not only from researchers looking to use what is viewed as the more cutting-edge approach, but also against a backdrop of weaker government spending on research, where proposals that explicitly mention a desire to use sequencing are viewed as more likely to secure funding than those that rely on arrays.
"The sad reality is that when you are making a grant proposal or submitting a paper for publication reviewers, when they see sequencing rather than microarrays, it tends to give you a brownie point," said Seth Crosby, director of the Genome Technology Access Center at the Washington University School of Medicine in Saint Louis.
Still, Crosby told BioArray News in April that he continues to see demand for arrays and that even though "people like to fund sexy stuff, and they like to publish sexy stuff … there are still going to be times when you are going to direct people not to use the sexiest thing, because you want to support this person's hypothesis in the most effective way" (BAN 4/12/2011).
The impact of sequencing on the array market was most apparent in two segments that have happened to be the most lucrative to array vendors over the years: gene-expression profiling and genome-wide association studies.
In terms of gene-expression profiling arrays, the market leader, Affymetrix, faced increased competition from RNA-seq applications offered by rivals such as Illumina and Life Technologies. Affy reported in November that its RNA business, which consists mainly of its gene expression microarrays, dropped 22 percent in Q3 — to $20.9 million from $36.9 million in the prior-year period — largely due to competition from next-generation sequencing as well as a constrained funding environment (BAN 11/8/2011).
Other players, such as Agilent Technologies, similarly acknowledged that sequencing had cut into their expression array sales (BAN 11/29/2011). Nick Roelofs, president of Agilent's Life Sciences group, said in November that the Santa Clara, Calif.-based company is "doing fine in [regards to] specific cytogenetic CGH utilization," but that the gene expression market is "rapidly being cannibalized by sequencing."
While the array-based GWAS market is not losing ground to sequencing per se, researchers continue to sit on the sidelines, waiting to see if projects undertaken by first adopters of high-density genotyping chips containing rare variant content unravel any more of the "missing heritability" underlying common human diseases. Company executives, such as Illumina CEO Jay Flatley, have anticipated that the first findings from these studies will become available in coming months, but throughout 2011, the return of large array-driven association studies remained a "wait-and-see situation," Flatley said (BAN 6/14/2011).
Some researchers have advocated smaller, sequencing-based studies to identify causal variants, as opposed to the larger array-driven studies of the past (BAN 4/11/2011). At the same time, there seems to be some consensus in the market, supported by a recent survey conducted by investment firm William Blair, that there is a need for exome arrays to validate findings, whether identified by sequencing or arrays, in larger, statistically relevant cohorts (BAN 12/13/2011).
Amidst a flat if not declining market for whole-genome genotyping chips, companies sought to diversify their offerings for association studies. Affy, for instance, rolled out a number of population-focused arrays during the year, including chips for studying African Americans and early human populations, seeking to capture business from researchers who have been unable to benefit from the existing chips on the market (BAN 11/29/2011, BAN 11/1/2011).
With the expression profiling and GWAS market segments under pressure from other technologies and funding uncertainty, array vendors looked to expand into other growing markets. Array-based cytogenetics was one market segment that continued to grow in 2011, and a variety of companies launched new products to meet demand, not only for chips that could be used to identify constitutional abnormalities, but for cancer research as well, with new offerings from Affy, Agilent, Ambry Genetics, CombiMatrix Molecular Diagnostics, BlueGnome, Signature Genomics, and Oxford Gene Technology, among many others (BAN 9/13/2011).
The market received a boost in July, when the American College of Human Genetics published guidelines covering the clinical application of arrays in constitutional cytogenetics (BAN 7/19/2011), and again in November, when the Cancer Cytogenomic Array Consortium reported preliminary results for a quality control study of arrays for use in cancer cytogenetics (BAN 12/6/2011).
Beyond cytogenetics, array vendors continued to expand into other segments. Illumina, for instance, told investors in September that new products for applied markets, such as agricultural biotechnology and forensics, might offset diminished association studies-related sales (BAN 9/20/2011).
Indeed, agbio-related chips continued to hit the market all year long, thanks in part to the availability of new content produced by next-gen sequencing, as well as manufacturing infrastructure put in place in recent years that has allowed big vendors to produce more chips. January saw Affy and Illumina release dueling array platforms for bovine studies, as well as a chip for studying rice. That same month, Affy launched 10 new model organism expression arrays for use on its benchtop GeneAtlas system (BAN 1/18/2011).
Array companies didn't only expand their array menus in 2011, but also sought to add new technologies. In November, Affy announced its intention to acquire San Diego-based eBioscience for $330 million, a deal that if completed will make the array vendor a global player in the flow cytometry and immunology reagents markets (BAN 12/6/2011).
And in May, Oxford Gene Technology, holder of some of the foundational IP in the array space, announced that it would begin offering its customers targeted next-generation sequencing services (BAN 5/31/2011). As such, by the beginning of 2012, even the most pure play array companies were not solely array companies anymore.
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