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Amid Market Exits and Acquisitions, 2012 Saw Arrays Gain Ground in Prenatal, DTC Markets

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2012 was a year of profound change for the microarray market, a year when one of the industry's major vendors decided to shutter most of its chip business and others abandoned hopes of a large "second wave" of genome-wide association studies that would match the first in scale.

At the same time, the technology moved closer to consumers than ever before, with a large study suggesting that arrays should replace conventional karyotyping for invasive prenatal testing, while Ancestry.com and National Geographic both introduced genetic genealogy services based on SNP chips to millions of subscribers.

NimbleGone

Market maturation and the global financial crisis left four major vendors standing in the array market by early 2009: Affymetrix, Agilent Technologies, Illumina, and Roche NimbleGen. While Roche NimbleGen was considered by most analysts to command the smallest chunk of the market of these four players, it continued to release competitive products all the way up until Roche announced in June that it planned to stop manufacturing DNA arrays by the end of the year — save for sequence capture-related products, although it later said it would also phase out array-based sequence capture (BAN 6/12/2012, BAN 10/2/2012).

Roche defended its decision to lay off the majority of NimbleGen staffers and exit the array market by citing its strategy to be the first or second player in the markets in which it chooses to compete, as well as a "mindset shift," in the words of Dan Zabrowski, head of Roche Applied Science. Zabrowski told BioArray News in June that the company used to be structured around different technologies and platforms, but had moved to the "view of the customer, in this case, the sequencing customer." The company's various sequencing offerings, such as its 454 business and its NimbleGen sequence capture products, were subsequently consolidated into a single business unit called Sequencing Solutions, though the company continues to use both the 454 and NimbleGen names.

Roche's decision to shutter its NimbleGen business came on the heels of a failed bid to acquire the industry's leading array vendor, Illumina, in April. Just ahead of a shareholder vote on measures that would have delivered Illumina to the Swiss firm, the US Federal Trade Commission sent a second request to Roche seeking more information about its NimbleGen array business in light of its $5.7 billion hostile bid for Illumina, pursuant to the Hart-Scott-Rodino Antitrust Improvements Act.

While Roche declined to provide additional information on that request at the time, some analysts said that if the FTC were to determine that the potential combination of Roche's NimbleGen array business and Illumina's BeadChip businesses violated antitrust legislation, Roche would as a result most likely divest the NimbleGen business (BAN 3/20/2012).

In the end, the issue was irrelevant as Illumina shareholders rejected Roche's bid.

Roche's announced exit from the array market caused customers big and small to scramble to move their NimbleGen-based arrays and services to other platforms. PerkinElmer's Signature Genomic Laboratories, for instance, announced in July that it would switch to Agilent's platform, which it had abandoned to use Roche's chips just three years earlier (BAN 7/31/2012).

Even though Roche shuttered its array business at year end, the firm's chip resources haven't been completely dismantled. The company confirmed in September that while it had no plans to compete in the DNA array market anymore, it is developing a high-density peptide microarray product that is "close" to commercialization (BAN 9/18/2012).

Prenatal Study

Beyond the impact of Roche's exit, 2012 saw papers published for two large, influential, and very different studies, each of which, vendors claimed, would change the future use of microarray technology.

The first of these studies, published last month in the New England Journal of Medicine, concerned the use of microarrays in prenatal diagnostics. Columbia University Medical Center researchers led this trial, the results of which indicated that chromosomal microarrays can provide more clinically relevant information than traditional karyotyping, and should become the standard approach in prenatal diagnostics going forward (BAN 12/11/2012).

The chromosomal array community had been anticipating the NEJM paper since February, when lead author Ronald Wapner presented preliminary data at the Society for Maternal-Fetal Medicine meeting in Dallas. As detailed in the publication, the researchers aimed to compare the amount of clinically relevant information that could be obtained from arrays with that of karyotyping, which has been the standard of care since the 1970s.

Using arrays manufactured by Affymetrix and Agilent Technologies as well as karyotyping, they conducted a blinded trial of 4,400 patients at 29 centers across the US over a four-year period. The study found that array-based analysis performed as well as karyotyping in identifying common aneuploidies that can cause genetic disorders such as Down syndrome and Edwards syndrome. Moreover, among fetuses in which a growth or structural anomaly had already been detected with ultrasound, microarrays were able to detect clinically relevant chromosomal deletions or duplications in 6 percent of cases, changes that were not observed with karyotyping the same samples.

Additionally, in cases sampled for advanced maternal age or positive screening results, array analysis picked up an abnormality in one out of every 60 pregnancies, about 1.7 percent of all cases that had a normal karyotype.

Based on these results, Wapner argued that arrays "will and should replace karyotyping as the standard for evaluating chromosomal abnormalities in fetuses," adding that chromosomal microdeletions and duplications found with microarray are "often associated with significant clinical problems."

Samples used in array analyses require fetal cells obtained via invasive procedures, such as amniocentesis or chorionic villus sampling. But should a noninvasive means for testing fetuses for genetic abnormalities become available, Wapner suggested that all women — not just those in special risk categories such as advanced maternal age — should have access to array analysis.

"We hope that in the future — when microarray can be done noninvasively — every woman who wishes will be offered microarray, so that she can have as complete information as possible about her pregnancy," Wapner said at the time.

The idea that arrays may become the go-to technology not only in a postnatal setting — as they have become in recent years — but also in a prenatal setting — potentially for all expecting mothers and, in some cases, adopted widely for preimplantation genetic diagnosis as part of in vitro fertilization cycles — has array vendors looking at the cytogenetics market as a vehicle for long-term, future growth.

Both Affymetrix and Illumina claimed at year end to be close to submitting their respective cyto array platforms to the US Food and Drug Administration for clearance sometime in 2013, and Illumina showed its interest in the market in September when it paid $88 million to acquire Cambridge, UK-based BlueGnome in September (BAN 9/25/2012). Meantime, CombiMatrix Molecular Diagnostics, an Irvine, Calif.-based genetic testing laboratory, made it clear that it expected to benefit from the anticipated changeover to arrays from conventional karyotyping in prenatal screening (BAN 8/14/2012).

"The findings of that study prove the benefits of microarrays, and thought leaders are confident that the paper will usher in a paradigm shift in prenatal testing favoring microarray analysis over the standard methods," CombiMatrix CEO Judd Jessup said last August. Investors agreed, and as BioArray News sister publication GenomeWeb Daily News reported this week, shares of CombiMatrix jumped around 89 percent for the month of December — a bigger spike than all of the stocks that comprise the GenomeWeb Daily News Index.

ENCODE

While the NEJM study appeared to herald the increased adoption of array technology, the results of another project raised questions about how arrays would be used going forward.

In September, 30 papers were published by members of the Encyclopedia of DNA Elements, or ENCODE, consortium in Nature, Science, Genome Research, and other journals. In these manuscripts, ENCODE members demonstrated that they were able to assign biochemical functions to around 80 percent of genome sequences — filling in large gaps left by studies that focused only on protein-coding sequences, which account for about 2 percent of the genome (BAN 9/18/2012).

Illumina's Jay Flatley said at the time that the ENCODE papers both helped to explain why array-based genome-wide association studies had not succeeded in correlating genomic variation with disease as anticipated, and pointed toward a need for more scientists to do whole-genome sequencing, as opposed to array-based genotyping or exome sequencing.

"One conclusion is that sequencing the exome is not where you need to be," Flatley said of the ENCODE papers in September. "You need to sequence the entire genome to get access to the entire spectrum of variation and regulation across the entire genome."

Flatley added at the time that the ENCODE findings "may in part be an explanation for why the earlier GWAS work didn't produce as significant a conclusion about the correlation of the genome to disease as we might have hoped."

In speaking to investors last month, Flatley was even more blunt about the impact of the ENCODE findings on the firm's array business. "There is information in other parts of the genome and we can't capture that all on arrays and that will drive our sequencing business in a positive way and probably hurt our array business," said Flatley of the ENCODE findings in December (BAN 12/4/2012 ).

Ancestral Markets

A few years ago, such words might have caused despair with regards to the future commercial prospects of array technology, but today array vendors see a large opportunity beyond life science research and seem encouraged by adoption in the ancestry testing market.

During the course of the year, arrays became the main technology used in genetic genealogy services offered by companies and organizations like Ancestry.com, Family Tree DNA, and National Geographic.

In May, Ancestry.com announced AncestryDNA, a service offered on the Illumina HumanOmniExpress BeadChip platform with a starting price of $199 (BAN 5/29/2012).

And in July, NatGeo kicked off the second phase of its Genographic Project, using an Illumina HD iSelect BeadChip containing just over 130,000 autosomal and X-chromosomal SNPs (BAN 7/31/2012). Geno 2.0 is priced at $199.95.

"I think the revenues would surprise you," Illumina CEO Jay Flatley told investors last month of the firm's sales to direct-to-consumer genetics firms, naming 23andMe and Ancestry.com in particular. "It's a very powerful technology and I think we will see continued use in those segments," he said (BAN 12/4/2012).

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