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SQI Diagnostics Attracting Pharma Deals with Multiplex Technology as IVD Business Advances

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NEW YORK (GenomeWeb) – Toronto-based SQI Diagnostics continues to see its CustomPlex diagnostic tools and services business generate revenue as interest in its technology from pharmaceutical industry partners increases.

The company said earlier this month that it had generated $32,000 in revenues in its fiscal third quarter, which ended on June 30, and $52,000 during the nine months preceding that date. While the sums may seem modest to some, it's worth noting that the firm reported no revenues in either the quarter or the first six months of fiscal 2013.

The reason for the company's spike in revenues is its contracts with pharma companies. The company has announced a number of contracts with some of the largest pharma firms during the past year, most recently in May when it inked a deal to develop and validate two custom multiplex anti-drug-antibody, or ADA, assays for a company that it did not name.

"In general, pharma is interested in our technology for its ability to multiplex and automate some of the laborious antibody-based tests they conduct, primarily during drug development," CEO Andrew Morris told BioArray News this week.

As an example, he described the ADA assays in development, noting that they help drug developers evaluate the immunogenicity of their drug candidates by quantifying the levels of certain antibodies produced in response to the administration of a drug into an animal or human.

"Instead of developing, validating, and then performing numerous enzyme-linked immunosorbent assays to evaluate immunogenicity, a single automated test co-developed with SQI can quantify and subtype these antibodies rapidly and using minimal labor," said Morris.

The company's multiplexing technology, IgPlex, enables users to assay proteins on planar arrays printed on 96-well plates. With regards to competitors in the space, he said that SQI's assays "appear to be more impervious to the confounding effects of free drug remaining in the blood sample that interacts with the antibodies you are trying to detect."

Working to serve pharma clients' needs also develops SQI's skill set. Morris said that SQI's partners have asked it to tackle new problems, resulting in new assays.

"For example, for one customer we are developing an epitope mapping assay that breaks down their biological molecule into sub-units that become the basis for a multiplex test that can identify specific regions of their drug candidate which are immunoreactive," he said.

SQI is also seeing some interest in using its capabilities to follow-on the drug development work with the possibility for companion diagnostics products, Morris said. "Though these opportunities are not necessarily immediate, we believe that there is good potential here to use our systems and assay development/clearance experience to develop longer-term and potentially very large volume revenue business."

He noted that the assays SQI is developing for pharma are specific to the drugs they are developing and used primarily to guide drug development, so that their individual commercial potential is tied to the scope of the specific drug development program. However, with each project, the firm is expanding the functionality and capabilities of its technology and Morris believes SQI can bring these product lines to its overall customer base down the road.

While SQI's core focus is on generating revenue via various pharma relationships, it is still advancing its diagnostics menu, including obtaining US regulatory clearance for an updated, higher throughput Ig_plex Celiac DGP Panel while preparing a test for vasculitis for launch. The US Food and Drug Administration cleared SQI's original 4-plex celiac assay in 2011. The agency also cleared a test for rheumatoid arthritis in 2009. SQI has also received Health Canada licenses for both tests.

Earlier this year, SQI received a Health Canada license for the Ig_plex Celiac DGP Panel. The test is intended for use in clinical laboratories to help diagnose celiac disease and provides semi-quantitative determination of the IgG and IgA immunoglobulin classes of deamidated gliadin peptide and anti-tissue transglutaminase antibodies in a single test that requires only one human sample, SQI said at the time.

"We are still very focused on our IVD business as well," said Morris. He said the company has submitted its newest celiac panel to the FDA and is still working on the vasculitis test.

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