By Julia Karow
This article was originally published Dec. 2.
Complete Genomics expects to become cash-flow positive by mid 2010, following rapid revenue growth, and plans to position itself in 2010 for an initial public offering, according to the company's chief executive.
During a presentation at the Piper Jaffray Health Care Conference in New York last week, Cliff Reid, Complete Genomics' president, chairman, and CEO, outlined the company's position in the next-generation sequencing market and discussed two projects by early-access customers that yielded medically relevant results. He also indicated that within three years, the company might provide human genome sequencing services for as little as $3,800 per genome.
Complete Genomics' aim is to respond to "an unmet need for large-scale human genome resequencing," Reid said, which will be required to discover genomic variants underlying a variety of human diseases.
Reid said that what sets the company apart from competitors that sell DNA sequencing platforms to researchers, rather than services, is the scale of its operations, which are optimized for sequencing human genomes.
He said the company sees three tiers of companies within the next-generation sequencing market: Vendors like Illumina, 454 Life Sciences, Helicos BioSciences, and Life Technologies provide customers with platforms that run a wide breadth of sequencing applications. Another batch of companies, including Illumina with its Avantome technology, Pacific Biosciences, and Oxford Nanopore Technologies, will provide technologies — also for many sequencing applications — that are optimized for speed and generate "quick and dirty" results. Complete Genomics, on the other hand, is "all about scale" and throughput and optimized for a single application — human genome sequencing.
The emphasis is not only on generating large amounts of data but also providing customers with "research-ready data" — analysis reports of genome variants such as SNPs and indels. For that reason, the company employs "more software engineers than biochemists," Reid said. At the moment, it is capable of assembling a human genome within 15 minutes, he said.
The company also apparently expects to lower its prices over the next few years. Taking the example of a hypothetical customer wanting to sequence 100 human genomes per year, Reid said that during the first year, such a customer could expect to pay $1.5 million, or $15,000 per genome; for the second year, $750,000, or $7,500 per genome; and for the third year, $380,000, or $3,800 per genome. In addition, there would be a $50,000 one-time initial cost for computing equipment. Using competitors' platforms, such as Illumina's Genome Analyzer, Reid claimed, researchers would incur several-fold higher costs for the same kind of project.
The company recently published a paper in Science outlining the use of its platform to sequence three human genomes at a consumables cost of between $1,700 and $8,000 per genome (see In Sequence 12/10/2009).
In terms of Complete Genomics' business model, Reid said it resembles that of sequencing instrument vendors in that both try to maximize the cash flow from each instrument, either in the form of consumables, or, in the case of Complete Genomics, services sold.
However, he claimed that because his company's instruments are both faster and run more frequently than competitors', the firm will likely be able to generate a three-fold higher cash flow per sequencing instrument over the next three years than, for example, Illumina.
So far, Complete Genomics has signed up about 20 customers for pilot projects, most recently German genomic service provider GATC Biotech (see In Sequence 12/1/2009).
Reid said that the company had initially expected most pilot projects to be in the area of cancer research, but current customer projects cover a wide variety of disease areas, including glioblastoma and melanoma, studied by the Broad Institute; central nervous system diseases, studied by Brigham & Women's Hospital; and diabetes, studied by Pfizer.
At least two projects, which Reid said are soon to be published in scientific journals, have yielded results of medical significance:
In one study, in collaboration with Jonathan Cohen, a professor of internal medicine at the University of Texas Southwestern Medical Center, Complete Genomics sequenced the genome of an 11-month-old baby that had very high low-density lipoprotein levels and was scheduled for a liver transplant. The researchers discovered mutations in a well-known lipid metabolism pathway gene, a condition that can be treated with drugs, so the child's transplant was canceled.
Another project, in collaboration with researchers at the Institute for Systems Biology, identified three candidate disease genes in two children from the same family who suffer from Miller's syndrome. ISB scientists have presented that work at recent scientific conferences, and an independent exome sequencing study on the same individuals by researchers at the University of Washington yielded essentially the same results (see In Sequence 9/29/2009).
Following an "imminent commercial scale-up" over the next few months, Complete Genomics has set itself several milestones for 2010, Reid said, among them to sequence 10,000 complete human genomes, to become cash-flow positive by mid-year, to increase the number of scientific papers published by its customers, and to position itself for an IPO.
Two goals for 2011 include to start offering human transcriptome sequencing and to establish a CLIA-certified laboratory, according to Reid's presentation.