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Facing Investors, Illumina, Affy, and Exiqon Outline '09 Product and Restructuring Plans


Illumina, Affymetrix, and Exiqon last week disclosed plans to launch new chips targeting markets as diverse as agricultural biotechnology, cytogenetic research, and molecular diagnostics, while highlighting their efforts to consolidate manufacturing and expand sales and marketing activities this year.

Presenting at the JPMorgan Healthcare Conference in San Francisco last week, these shops all stressed that they will focus on different markets in 2009.


Illumina CEO Jay Flatley said the company will continue to launch new arrays for genotyping during the next 12 months, and reiterated plans to add capacity at its manufacturing facility in Singapore.

During his presentation, which was webcast, Flatley said he expects to launch a new generation of chips for association studies, driven by content developed on the Genome Analyzer, the firm's second-generation sequencer, and through publicly funded research efforts like the 1000 Genomes Project.

"In the array business, we think there is a new cycle of genome-wide association that will begin in 2009, and we are calling this rich genome-wide association," Flatley told investors and analysts during the conference. "The new arrays that will come out of the content generated by the 1000 Genomes Project will include rare variation information," he said, echoing comments he made last June (see BAN 6/17/2008).

Flatley also promised to debut two new array-related products this year. The first, called Harmonia, an addition to the iScan scanner the firm launched last year, is a "sequencing module" that will allow users to "graduate into the sequencing business," Flatley said. The platform will become available in the second half of this year, he said.

"This is a great transition product," Flatley said of the Harmonia. "It will enable targeted sequencing after whole-genome association studies [and] will be important for applications that are migrating from arrays to sequencing such as gene expression."

Illumina later this year also intends to replace its 96-well-based Sentrix Array Matrix platform for multiplexed genotyping with its Universal 32 BeadChip, which enables users to survey 32 samples per array, said Flatley.

The new products will follow a string of debuts in 2008 from Illumina, among them the 2-million-feature HD Human 1M-Duo, the 610-Quad, and the 660W-Quad BeadChips for whole-genome association studies; its Bovine SNP50, EquineSNP50, and CanineSNP20 BeadChips for agbio customers; and its Human CytoSNP 12 BeadChip for customers doing cytogenetic research.

Illumina launched two more agbio-related products last week, debuting its OvineSNP50 and PorcineSNP60 BeadChips.

"We think this will be a great opportunity for our array business going forward. In the livestock market alone, we think this will be a $500 million opportunity for the tool providers," Flatley said. Last year, Illumina had $54 million in orders directly attributable to its agbio business, he said.

Flatley discussed Illumina's plans to migrate some of its array manufacturing to Singapore. He said the company last quarter manufactured 34,000 BeadChips with a 92-percent yield rate, and said he hopes to manufacture 90,000 of the chips in Singapore before the end of March.

He added that Illumina will evaluate manufacturing products other than BeadChips in Singapore later this year.


Introducing new genotyping products and consolidating manufacturing resources are also on Affy's list of things to do in '09. President and CEO Kevin King told investors during his presentation that the company intends to launch "next-generation genotyping" products during the year while also maintaining its share of the expression market.

King told investors and analysts that Affy plans to launch genotyping arrays for use on its GeneTitan platform, launched last October, which will have internally developed content and a new assay that uses reagents obtained via the firm's $75 million acquisition of USB last year (see BAN 2/12/2008).

These "next-gen genotyping products will include new content, including new copy number variation, SNP allele frequencies, and the on-demand sub-setting of that information for customers," King said during his presentation. "This is a genome-wide sequencing assay that provides for optimal sensitivity and specificity. It allows the users to target any part of the genome in a single study. Customer throughput, in running hundreds of samples at a time, is another benefit."

While he said Affy will continue to expand the menu of assays that can be used with GeneTitan, a company spokesperson told BioArray News this week that the firm "recognizes that we have an obligation to continue to support and enable our existing installed base and will continue to do so.

"Our goals are to continue to evolve our customer base to the plate-array format, due to the benefits it affords researchers, including greater compatibility with automation, more cost effective arrays, and considerable labor savings with the GeneTitan, while at the same time, ensuring that our existing install base is well supported," the spokesperson said.

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The peg format that the GeneTitan was designed to support, which King dubbed "arrays of arrays," is sold as strips of arrays designed to work with laboratories' existing microtiter plate set-ups. The GeneTitan launch was accompanied by a reintroduction of catalog human, mouse, and rat whole-genome expression arrays in the peg configuration (see BAN 10/3/2008).

According to King, Affy expects the "global genotyping market" to grow from around $410 million this year to $750 million in 2011.

He said Affy will also introduce a "new family" of cytogenetics products this year. Last March, the company launched its first product specially tailored for the cyto-research market, the Cytogenetics Solution, which is supported by Affy's flagship SNP 6.0 Array.

King said that Affy now plans a "new family of arrays using sequencing chemistries that are optimized for copy number and SNP detection with a brand-new assay developed with USB."

In terms of manufacturing consolidation, King said the company is about "95-percent complete" in transferring its array manufacturing facilities to Singapore. He also said that the transfer will be completed during the second quarter.

Meantime, King said, the company is preparing to shift a larger proportion of its reagents manufacturing to Cleveland-based USB's facilities in Q2, a move that "should save us $20 million to $25 million a year."

According to the Affy spokesperson, the company is already manufacturing a "number of
reagents" at USB's facility that were previously outsourced and "we are realizing the financial benefits of that development effort."

The spokesperson added that Affy plans to establish a "center of excellence" for reagent development and manufacture in Cleveland that will be fully operational in Q2. Still, some of Affy's products will "continue to make use of third-party supplied reagents where unique intellectual property is involved," he said.


While West Coast array makers Illumina and Affy continue to duke it out in the genotyping market, Danish biotech Exiqon is focusing on the molecular diagnostics sector this year.

This month, Exiqon debuted an miRNA-based assay designed to detect colorectal cancer recurrence. The company will perform those tests from the Clinical Laboratory Improvement Acts-compliant labs at its Tustin, Calif.-based subsidiary Exiqon Diagnostics (see BAN 10/21/2008).

During the company's presentation, CEO Lars Kongsbak said the firm is currently developing tests for endometrial and lung cancer, and that Exiqon plans to add a cancer-of-unknown-primary assay next year.

In an e-mail to BioArray News this week, Kongsbak said that the company has not yet determined whether these new assays will use microRNA markers, or on what technology platform they will be deployed.

"MicroRNAs are often very powerful, and whenever it makes sense to address miRNAs as biomarkers we will do so," Kongsbak said in his e-mail. "We have the capability to apply in situ hybridization tests, qPCR tests, and tests based on arrays. However, we know that in many cases only one or a few miRNAs are needed, which means that arrays are not relevant."

In terms of the research market, Kongsbak said that Exiqon will "continue updating" its miRcury miRNA arrays. The company recently launched an array that can detect more than 1,300 human miRNAs, all of whose capture probes are validated by synthetic targets. The validation includes sensitivity and specificity with no cross-hybridization, according to the company

Exiqon in 2009 also plans to outlicense some of its patent estate to companies it deems to be outside its core markets. Kongsbak said that Exiqon currently has 174 active patents and patent applications in 32 patent families, including 91 issued patents, much of them centered on its core locked nucleic-acid technology.

Kongsbak said that some of the market segments that could make use of Exiqon's IP might include agbio and forensics. The company is also open to licensing its IP to "more product-specific areas" within diagnostics or research tools, he added.

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