If you can’t beat them, avoid them?
This appeared to be Beckman Coulter’s strategy a couple of weeks ago when it decided to buy Peoples Genetics’ constant denaturant capillary electrophoresis technology.
The technology, which enables researchers to identify gene mutations in large pools of DNA, will enable Beckman to compete with Applied Biosystems — the “gorilla in the sequencing market,” according to Beckman treasurer Paul Glyer — without actually going head-to-head with the company.
The acquisition, which effectively gutted Peoples Genetics, is also intended to help Beckman sell the newly acquired SNPStream genotyping platform, and will mean that Beckman now will be facing off against Transgenomic.
In the short term, Beckman’s plan is twofold: to integrate Peoples Genetics CDCE technology into its CEQ 8000 gene sequencing platform, and to make the SNPStream platform a favorable companion to the CEQ product line, company officials said. Long term, Beckman would look to use both technologies to identify markers, validate them, and market them as molecular diagnostics.
“One of the things I wanted to accomplish out of [the technology acquisition] was to expand the menu of the CEQ instrument so that we have an instrument that somebody can [use to] do mutation discovery,” Mike Boyce-Jacino, head of strategic affairs at Beckman, told SNPtech Reporter this week.
The CEQ platform already performs gene sequencing, heterozygote detection, confirmatory sequencing, mutation analysis, SNP scoring, microsatellite instability, and amplified fragment length polymorphism fingerprinting. The company’s genetic-analysis and high throughput-screening businesses — which house the CEQ and SNPStream platforms — comprise 25 percent of revenues generated by Beckman’s Biomedical Research Division, which in turn accounts for around 30 percent of the company total receipts, according to Beckman president and CEO John Wareham. Both platforms sell to just 5 percent of the $840 million gene-sequencing and SNP-genotyping markets.
Boyce-Jacino said the CDCE technology, which he called a “front end population-characterization tool,” is upstream of the SNPStream technology, and that it will complement the genotyping instrument. For example, once the CDCE technology is integrated with the CEQ, scientists will be able to sequence desirable gene fragments, scan the populations for SNPs, or characterize the samples via fragment analysis.
“You don’t know what the marker might be,” he said, describing a typical scenario in which a researcher might use the two platforms. “You need to discover what [the marker] is, but you don’t really have a sense of where in the gene of interest it might be, and you don’t want to ... sequence a couple of thousand people. This way you pool everybody together, you run it on the CEQ, [and] if you see a particular kind of peak … you can tell that there is a variation in a particular sequence. Then you can look at the individuals in that pool in a much more constructive way,” he said.
“If you’re looking at large groups of cases and controls, you want to look for a few individuals who are carrying mutations that seem to associate with whatever phenotype you’re looking at,” said Boyce-Jacino. Today, researchers often must sequence every individual for those genes of interest, or have a hypothesis-driven analysis of known SNPs. “It’s really hit or miss,” he said. “The idea here is that you go in and find whatever’s there — however rare [the mutation] is in that population — and then go back and characterize those variations.”
Boyce-Jacino stressed that Beckman does not plan to marry CDCE with SNPStream. Rather, the company wants the CEQ line to complement the genotyping tool. “The intent is that people who do any mutation discovery on one platform can use the other platform,” he said. “We’ll move SNPStream over time … to look at higher density arrays … for high-throughout population analyses. But CEQ will be for focused discovery and characterization tools.”
Boyce-Jacino said Beckman expects to begin selling the newly integrated CEQ platform next fall. He stressed that though the CDCE technology will initially be integrated into the CEQ 8000 instrument, Beckman intends to study “how best to append” the Peoples’ Genetics technology into Beckman’s overall CEQ product line. (Before buying the CDCE technology, Beckman tested it on its CEQ 8800.)
Boyce-Jacino said rivals will be companies like Transgenomic, which he called the “primary competitor in the space today.” Customers will be reference labs, especially those studying rare mutations.
The Peoples Genetics acquisition represents the second of two linchpins that Beckman has been cultivating as it makes strides downstream. Like George Bers, Beckman’s vice president of systems biology, said, the CDCE technology will give Beckman “the opportunity to gain market share in downstream molecular diagnostics and pharmacogenomics testing.”
The first linchpin, of course, was Beckman’s acquisition last year of Orchid’s Life Sciences division, which contained the SNPStream product line and various pharmacogenomics-related odds and ends [see SNPtech Reporter, 1/17/03].
“We’re positioning Beckman … in the systems biology space, providing that sort of holistic strategy,” said Boyce-Jacino, who had been Orchid’s chief science officer and vice president of its now-defunct Life Science division. “And in genomics, [Beckman is] looking at how information is discovered, characterized, and utilized, and trying to make sure we have [tools] for each of those steps. We’re trying to target these acquisitions … to allow us to handle the needs of the customers across that spectrum.”