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Industry Pitches Array of Services, Products

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While the big A’s of microarrays were taking the spotlight at the recent UBS Warburg Life Sciences, that was by no means all the action bubbling up from this sector. Companies are adding layers of services and new products to a market now dominated by Affymetrix. Following are some highlights of the conference:

Illumina has turnkey System: 1 Million SNPs for $2 Million

San Diego based Illumina is offering a turnkey service for anyone who has the need to do 1 million genotypes a day, John Stuelpnagel, senior vice president, said.

Stuelpnagel said the company will install all of the hardware — such as robots, thermocycler ovens, and array scanners — plus software, and information technology, as well as train laboratory personnel for buyers of this system, which mirrors Illumina’s set-up.

For those who might need a little less horsepower, the company will install a system capable of 600,000 genotypes per day for $1.5 million, he said.

The product extends Illumina’s strategy of commercializing its microbead array assay by offering services such as the custom synthesis of oligonucleotides and SNP assay services.

The company will soon roll out Sherlock, an array scanner that reads at 0.8 micron resolution, targeting the gene expression and proteomics markets. The scanner automatically reads the 96 arrays on its Centrix matrix in two colors, simultaneously. The product is in pilot production, Stuelpnagel said.

Enzo Is Selling Reagents, and Targeting Diagnostics

Barry Weiner, president of Enzo Biochemical, a Farmingdale, N.Y.-based instrumentation and reagent company, is bullish on the potential growth of the microarray market.

While his company sells gene identification products to companies like PerkinElmer, Roche, Amersham, and Gene Logic, it is also linked strongly to Affymetrix, with an exclusive agreement to supply the reagent kits sold with each GeneChip brand chip the Santa Clara microarray giant sells.

“We see a lot of future benefit, the array market is growing significantly now,” said Weiner.

While supplying the high-end of the microarray market, the company has just rolled out GeneBeam, a labeling and detection system product that targets low-density array users, he said.

The future, Weiner said, is the clinical diagnostics market.

“We are focusing on the highest growing aspect of a sizeable $20 billion market,” he said. “That is the DNA probe and in situ market. We are looking to create a small tool for doctors’ offices and emergency rooms that would allow for DNA detection at the point of care.”

Getting Clarity on Perlegen’s Costs

Perlegen Sciences of Santa Clara, Calif., which in August completed the sequencing of 50 human genomes at single-base resolution, offered further details on the price tag of this feat.

The company has said before that the 15-month effort cost it $100 million, mainly for the hundreds of GeneChip brand wafers it purchased at cost from its parent, Affymetrix, in order to collect the information that will drive its business going forward.

Perlegen was spun out of Affymetrix with $100 million in venture capital investment led by the European bank Lomard Odier & Cie. So, if you reconcile the costs of the sequencing against the cash it had on hand, it couldn’t have that much of an operating margin remaining.

Brad Margus, the company president, told BioArray News that the genome resequencing only cost about $80 million. Still, the company is now pursuing an additional round of financing.

“Our burn rate has changed dramatically,” Margus said. “Now, our costs are driven by the business we get.”

The company wants to wrap up by the first quarter an additional round of financing that will be sufficient to carry it through to an initial public offering. The company was valued at $266 million when it received its initial funding.

Affymetrix owns a majority interest in the company and Margus said its parent will participate in the next round of funding but its equity stake will then fall below its present majority stake.

What’s Hot in Microarrays? Ask Zymark’s Kevin Hrovsky

The microarray market has some kinks in it that need to be straightend out, Kevin Hrusovsky, president and CEO of Zymark, the laboratory automation manufacturer, told BioArray News.

Zymark has applied for a patent on a cartridge technology that would be complementary to glass microarrays. The cartridge, which is in use by Johnson & Johnson, allows users to automate all of the steps — putting samples on, washing with hybridization fluids, incubation — everything after the cDNA has been embedded on the surface of glass slides, he said.

“Mixing is a horrendous manual process,” Hrusovsky said. “[Very little] of the manual labor in DNA hybridization is in that step,” he said. The cartridge also straightens out imperfections in the glass and forces the slide to be perfectly flat, he said.

As far as Zymark is concerned, a partnership with Affymetrix, or any other microarray manufacturer, would be a good thing. Hrusovsky said the cartridge is in preliminary stages of development.

As for other aspects of the microarray industry, Hrusovsky said interest for high throughput screening for ADME/Tox is high.

“We have 14 or 15 systems in ADME/Tox,” he said. “There is a lot of work going on with chip correlations with genes in the ADME/Tox area and we are building a lot of automation around that.”

Gyros Readies Product Launch in 2003

Gyros, an Uppsala, Sweden based startup, operating on two tranches of venture capital investment totaling $65 million, will roll out a CD-based protein microarray next year after first launching a laser-induced fluorescence detector, and a MALDI sample preparation CD, CEO Maris Harmanis told BioArray News.

The firm is targeting pharmaceutical companies as buyers of its custom technology that puts microchannels on a CD and then uses centrifugal force to process samples.

Harmanis said the company plans an initial public offering at some point, but will need at least one more injection of private capital before that would be possible.

Meantime, he said he expects a shakeout in the emerging world of proteomics.

“There is just so much hype around it — but the technology doesn’t perform to standards or the binders don’t deliver performance. It’s going to take three to four years for it to shake out.

“The applications will show the way, when you put the biology in the system, then you will see what works.”

— MOK

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