SAN FRANCISCO (GenomeWeb News) - Life Technologies today made its case to investors at the JP Morgan Healthcare Conference held here, with a heavy emphasis on its sequencing business and the opportunity to exploit its technologies in the clinical diagnostics field.
Company officials see the potential for Life Tech's sequencing and qPCR platforms in developing new molecular diagnostic tools that could potentially supplant other technologies, including arrays. According to Life Tech Chairman and CEO Greg Lucier, the firm has already reached out to diagnostic firms to provide content, while it also has pressed forward with its own content efforts.
While diagnostics was a frequent topic of discussion in the firm's presentation and during its breakout, advances in its sequencing business were the primary focus. In conjunction with its appearance at the conference, Life Tech today announced the launch of the so-called "316" chip for Ion Torrent's Personal Genome Machine. The new chip, which improves the performance of the system's current chip by 10-fold, to 100 megabases per run, will ship to early-access customers in the first quarter of this year.
President and COO Mark Stevenson told GenomeWeb Daily News in an interview that the Ion Torrent system is enabling the firm to bring next-gen sequencing technology to a group of users that previously couldn't afford such systems, primarily those who have done capillary electrophoresis sequencing but couldn't afford the next-gen systems.
The firm launched the PGM, which costs $50,000, in mid-December and has received more than 60 orders thus far. It is shipping to early-access users and expects to be fully shipping orders in the second quarter.
The newest version of the company's SOLiD next-gen sequencing system, the 5500, will ship at the end of the first quarter, Stevenson said. He said the firm worked with its partner Hitachi to make the system more robust and improve the accuracy. He noted that Life Tech will be offering upgrades to the new system for current SOLiD users.
According to Stevenson, one of the improvements to the system was the introduction of a FlowChip that allows researchers to run as few as one lane containing up to 96 samples or as many as twelve lanes for more than 1,000 samples, while maintaining the same overall cost per run.
Stevenson also said the firm's CE instrument sales grew this past year and it expects CE sales to continue to grow. He said the machines are being used in small hospitals and labs, for forensics, and for validation of next-generation sequencing results. The CE technology also allows researchers to analyze just a couple of genes without the sample prep issues associated with the more complex systems.
Stevenson said that the next-gen systems have not cannibalized any of the company's CE business. Rather, he said, researchers are moving applications out of arrays to next-gen sequencing.
Echoing comments made by others in the industry, Stevenson said that sequencing-based diagnostics will happen in the near future. He cited the accuracy of the systems and the rapid discovery of new content that makes sequencing more attractive than array-based diagnostics.
Life Tech intends to move its 3500 Genetic Analyzer, a low-to-mid-throughput CE instrument, through the FDA 510(k) process during the next year, with an eye toward pushing the SOLiD and Ion Torrent systems through the regulatory process at a later time, perhaps in a couple of years.
The firm has already launched a KRAS assay and plans further development of other cancer assays. Stevenson also said the company is partnering with pharma companies to develop companion diagnostics.
In addition, Life Tech is conducting a study of using next-generation sequencing for breast cancer analysis. Stevenson said that would provide proof of principle for using whole-genome sequencing to help guide cancer treatment. He said the firm expects to release the results of that trial mid-year at a cancer meeting, and added that initial results from the first couple of patients have been "very encouraging."
Life Tech's commitment to pushing sequencing tools into the clinic is evident from its recent establishment of a Molecular Medicine business unit. The firm said last month that Bernd Brust, its former president of commercial operations, had taken over the role as president of the new unit. Brust will report directly to Chairman and CEO Greg Lucier, as it will operate as one of the four primary business units of the firm. The other three are Genetic Systems, Molecular Biology Systems, and Cell Systems.
Stevenson told GWDN that the unit's primary focus is to bring together "content from existing platforms, looking at partnerships externally to bring new diagnostic content to our platforms, and developing out whole-genome sequencing."
He noted that about 10 percent of Life Tech's business, or $300 million, is sold into clinical diagnostic companies and labs. "So we will really build out over the next three to five years that molecular diagnostics business," he said.
Going forward, Stevenson said Life Tech will be looking at M&A activity, as well as partnerships, to help grow the business. He said new technologies, such as those the firm gained through its recent Ion Torrent and BioTrove acquisitions, would be primary acquisition targets, along with expansion in emerging markets, and molecular medicine content and informatics.
While M&A would be one of the primary uses of cash, Stevenson said the firm's top priority is paying down its debt. Another primary use for its cash is buying back stock, and the firm announced today the commencement of a $500 million repurchase program.