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Ion Torrent Users Cautiously Optimistic on Thermo Acquisition

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Following last week's announcement that Thermo Fisher plans to buy Life Technologies for $13.6 billion, Ion Torrent customers are taking a wait-and-see approach, although many are optimistic that the acquisition could be a boon to Ion Torrent development and to the next-gen sequencing field as a whole.

Thermo Fisher held a conference call following announcement of the deal, and while they did not elaborate on their plans for Life Tech's Ion Torrent technology, company officials said that they expect Ion Torrent to exceed the growth rate for the rest of the acquired company (IS 4/16/2013).

Some customers think that Thermo may be willing to invest more heavily into Ion Torrent to try to catch Illumina, currently the market leader in the next-gen sequencing space. This increased pressure could potentially benefit customers by serving to both drive technology improvements and push down prices.

Additionally, the acquisition wouldn't result in consolidation in the sequencing instrument market since Thermo is not currently invested in the space, so the concerns about eliminating the competition that were present when Roche attempted to take over Illumina are not an issue in this case. Thermo does, however, make reagents that are used for various NGS platforms, including a sample-prep kit dubbed MuSeek for the PGM, and reagents that are used in DNA purification steps, and other library preparation protocols.

Thermo may also bring unique capabilities in the way of sample prep technology, which could benefit Ion Torrent.

Nevertheless, customers say it is too early to tell what the long-term impact will be, but they anticipate that when the deal finalizes in 2014 it will be clear to what extent Thermo plans to invest in Ion Torrent. In addition, customers will also know by that time if key members of management are staying with the combined firm.

"We're business as usual," Jeff Boyd, executive director of Fox Chase's Cancer Genome Institute, told In Sequence. Fox Chase began offering a targeted sequencing cancer test earlier this year, dubbed CancerCode-45, that uses the Ion AmpliSeq technology on the PGM.

"I'm not predicting any drastic changes, but it would be irresponsible not to keep our options open," he said.

Thermo Fisher is a "larger company, so as customers we're hopeful that they'll increase their R&D budget" for Ion Torrent, Joe Boland, director of research and development at the core genotyping center at the National Cancer Institute told IS.

Boland's lab at the NCI currently operates four Ion Proton machines, six Ion Torrent PGMs, two Illumina HiSeq 2000s, and one MiSeq.

"Thermo has a good track record in their area of expertise, so I'm hoping that they bring that leadership over to drive Ion to that next level," he added.

The acquisition could put pressure on Illumina, increasing competition between the two companies, which would ultimately serve to benefit customers.

"Illumina is the market leader today," Boland said, but, "I'm sure [Thermo has] every intention of trying to become number one. … You're not going to buy something to be number two," he said.

In particular, Thermo could add value to Ion Torrent in sample prep, said Dean Gaalaas, CEO of EdgeBio, which offers sequencing services on the Proton, PGM, HiSeq, and MiSeq. Currently, Ion Torrent's systems rely on emulsion PCR, which is very labor intensive, explained Gaalaas, especially when compared to the sample prep for Illumina's MiSeq, which is more plug and play.

"As long as there's that manual step of emulsion PCR, that is really what is going to hold them back in the clinic," he said. Thermo, however, may have the "muscle and design capabilities to really take a hard look at that with Ion," and develop a sample-prep technology that is more automated and less labor intensive, Gaalaas said.

"If they can solve that problem, that's when you'll really start to see the [sequencing] wars in the clinic," he said.

Customers with whom IS spoke are taking a more favorable attitude toward the Thermo acquisition of Life than Illumina customers took to Roche's attempt to acquire that firm last year (IS 1/31/2012).

Illumina customers were concerned that a Roche takeover would spell the end of innovation at Illumina, in addition to concerns about the consolidation of the sequencing market. But, in part because Thermo is not yet in the next-gen sequencing instrument market and acquiring Life will not narrow the field, customers are more optimistic regarding the impact of this deal.

"I think there was prejudice built in against Roche because of what they did with 454," Gaalaas added. "The development arc [454] was on seemed to die" after Roche acquired the company.

Because this is Thermo Fisher's entry into the next-gen sequencing instrument space, the company has a clean slate in customers' eyes. "Everyone is taking a wait and see approach," he said.

Another important consideration for customers is the potential for changes in management at Life Tech, said Dag Harmsen, a professor at the University of Münster, who uses both the PGM and MiSeq in his research. In particular, he thinks that if Jonathan Rothberg leaves the company, that could have a negative impact. "But that's pure speculation," he said.

Gaalaas agreed that certain personnel would play an important role in the acquisition. For instance, he said, the fact that Mark Stevenson, Life's president and chief operating officer, will be part of the new management is a good sign.

"He was a driving force at Life behind Ion," he said, and that could be an indication that Thermo intends to keep investing in Ion.

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