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Sequenom Discloses Mishandling of Test Data; Shares Plummet

NEW YORK (GenomeWeb News) – Sequenom said Wednesday after the close of the market that it would delay the launch of its SEQureDx Down syndrome test until the third quarter of this year after it discovered that company employees had mishandled R&D test data and results.

"This raises significant concerns regarding the integrity of that data," said Sequenom President and CEO Harry Stylli during a conference call.

He noted that the firm had suspended four employees and put a new team in place to oversee studies of its prenatal diagnostics. He also noted that all of the employees suspected of wrongdoing were in the R&D organization.

In early Thursday trading on the Nasdaq, Sequenom's shares plummeted 77 percent to $3.49.

The firm had previously expected to launch the test in June. It said that it now will launch the test upon publication in a peer-reviewed journal of the results from the "ongoing large, independent clinical studies."

As of early February, Sequenom had released data on its SEQureDx test from a total of 858 samples. It said that the positive predictive value was 96.6 percent, and the negative predictive value was 100 percent. But, the firm can no longer rely on that data.

"We are confident in the assay performance," Stylli said during the call. "It's fair to say that the high-level clinical performance that we've disclosed to you is questionable."

Stylli said he was limited in what he could say in response to questions about the incident, due to confidentiality agreements and the investigation. "The data in question relates to data that goes back to June — the September and January releases of information — I believe that information is now suspect … I can't really go into any of the details because of the confidentiality considerations and because the investigation is not complete," he said.

However, Stylli said that "this is not related to the technology or the science itself. This is related to issues internal to Sequenom, we believe."

Sequenom also said that it expects to continue pursuing development of its RNA-based and DNA-based methods in parallel for a Down syndrome test and will seek to have a validated test in the fourth quarter of this year.

The firm's board of directors has formed a special committee of independent directors to oversee an independent investigation of the employees' activities related to the test data and results. It also has hired independent counsel to assist the committee in conducting the investigation.

Stylli said that the firm has already notified the US Food and Drug Administration and Securities and Exchange Commission. He also said that he believes the firm is adequately capitalized to conduct additional studies and launch a Down syndrome test in the timeframe given.