Luminex this week provided investors with additional details regarding the planned expansion of its molecular diagnostics business to tap into the laboratory-developed test market and to serve customers seeking a platform with higher throughput and lower multiplexing than Luminex's xTAG-based systems.
In an interview with PCR Insider preceding Luminex's investor day meeting in New York, CEO Patrick Balthrop discussed Project Aries, the company's internal moniker for its ongoing efforts to combine real-time PCR chemistry obtained as part of its acquisition of EraGen Biosciences last year and the sample-to-answer molecular testing system acquired along with startup GenturaDx this past summer.
In addition, Balthrop noted that Luminex plans to continue to invest in its more highly multiplexed xTag-based assays in an effort to increase their automation and ease of use, and will be moving from a distributor to a direct sales model for its molecular diagnostics products.
According to Balthrop, Luminex's clinical assay business, which is composed almost entirely of molecular tests, has grown 50 percent to date this year over last year's sales, and is expected to maintain that pace through the end of the year.
The growth has largely been predicated on sales of the company's xTAG assay chemistry and xMAP platform. In an xTAG assay, PCR products undergo an allele-specific primer extension step. The 5' end of the primers are then attached to an xTAG universal tag sequence that is hybridized to the complementary anti-tag sequence coupled to xMAP beads, which are subsequently read and analyzed on the firm's 100/200 and MagPix instruments.
Luminex's xTAG assays enable a high degree of assay multiplexing, as exemplified by the company's flagship commercial assays, the xTAG Respiratory Virus Panel, or RVP, a US Food and Drug Administration-approved assay that detects 12 viruses and subtypes associated with respiratory infections; and RVP Fast, which targets eight respiratory pathogens and provides up to 96 patient results in a few hours. Luminex also sells an FDA-cleared xTAG Cystic Fibrosis assay; a CE-IVD marked NeoPlex4 assay for screening certain genetic disorders in newborns; and is expecting to soon receive FDA clearance for an xTAG Gastrointestinal Pathogen Panel, or GPP.
Also contributing to Luminex's clinical assay growth are its MultiCode analyte-specific reagents, which the company acquired along with EraGen (PCR Insider, 6/23/2011). These reagents feature isoC and isoG synthetic base pair chemistry as part of a probe-free real-time PCR system for highly specific and sensitive detection and quantification of nucleic acid targets, and can be used by customers to develop their own molecular diagnostic tests.
In July of this year, Luminex announced it was acquiring privately held Hayward, Calif.-based molecular diagnostics developer GenturaDx for $50 million, primarily for that company's IDBox platform — a fully integrated and automated cartridge-based real-time PCR system (PCR Insider, 7/12/2012).
Luminex hinted that the GenturaDx platform and MultiCode chemistry would be synergistic, but, until this week, had kept the exact nature of that complementarity under wraps.
"Project Aries is an internal code name that basically means [putting together] the assay technology that we obtained when we acquired EraGen … and the Gentura Dx platform that we acquired six months ago," Balthrop told PCR Insider.
"That combination allows us to be able to, we think, [address] some emerging needs in the clinical PCR market, where a lot of the platforms are relatively small and slow," Balthrop added. "We think customers need additional capacity and throughput, so we're designing [Project Aries] with that in mind."
Balthrop said that Luminex's product development team, primarily based at the company's headquarters in Austin, Texas, is redesigning the IDBox system as part of Project Aries. The new Luminex-branded product is "going to look and perform a lot differently than the GenturaDx product did," he said.
"It's going to be similar in that it has capacity for 12 cassettes at a time," Balthrop said. Otherwise, he added, "the throughput will be market-competitive, so one- or two-hour turnaround time per cassette. It will be random batch, so you can run 12 of the same kinds of tests, or you can run 12 different tests simultaneously. It's also being designed so it will take up significantly less [bench space] — the GenturaDx box was more like a cube, and this will be more like a tower … a module over a module rather than two side-by-side modules."
Balthrop also noted that the new platform will have dedicated software, which the IDBox lacked, and a 15-inch touchscreen interface.
The new platform will also be optimized to run MultiCode-based assays, which was one of the primary reasons that Luminex brought the system on board.
"When we acquired EraGen, it kind of stood on its own, we felt like it was a good deal for us even if we had to use, [for example,] a Roche LightCycler instrument that was already on benches," Balthrop said. "It was an even better deal for us if we could find a platform that would allow us to deliver an integrated product, and that's what we were able to do by acquiring GenturaDx."
Balthrop did not provide a development timeline for the Project Aries system, but once it hits the market, Luminex believes that it will complement its xTAG-based offerings and provide the company with an advantage over other molecular diagnostic vendors.
"Customers need different tools in their toolbox," Balthrop said. "If they want to do a cystic fibrosis assay that requires 60 mutations to be detected, they want to use a multiplexing method to detect all 60 at the same time. If, on the other hand, they want to run a single-plex infectious disease marker because they have an outbreak in their hospital, and when the sample arrives they're 90 percent sure it's going to be a particular outbreak result, they want to have the ability to do one at a time."
Luminex was serving the highly multiplexed portion of the market, "but what we weren't serving was that low-plex market, which frankly is where a lot of the molecular diagnostics market opportunity resides," Balthrop said. "Similarly, other companies that are [providing] low-plex capability don't have multiplexing methods. So the combination here, of our multiplex methods, plus Eragen/GenturaDx, gives us the ability to be the only company that can serve the entire market regardless of the plex that they want to perform."
A second major component to the Project Aries initiative is to provide customers with an integrated platform to develop their own molecular tests. "One of the major growth drivers for us this year has been that LDT business," Balthrop said. "We're designing Project Aries in a way that it will be compatible with customers wanting to do LDTs. The system is being designed with a universal protocol, regardless of whether it's an infectious disease … or a [pharmacogenomics] kind of assay."
In addition, Luminex will offer its own menu of pre-packaged assays for the Project Aries system. Balthrop declined to detail the planned test menu, but said that the current MultiCode analyte-specific reagents offered by the company provide a clue. According to Luminex's website, the company offers MultiCode ASRs for Bordetella pertussis, enterovirus, influenza A and B, cytomegalovirus, BK virus, Epstein-Barr virus, adenovirus, JC virus, Varicella-Zoster virus, herpes simplex virus, and several sexually transmitted diseases.
"It's very infectious disease-concentrated," Balthrop noted. "In the MDx space, if it's not an inherited [disease or trait] test, like a PGx test or [for something like] CF, it's probably an infectious disease test. So it will probably lean heavily toward some of those areas.
"We do expect to have a significant number of assays when we launch the system," he added. "Part of our planning over the past six months and for 2013 … has been reprioritization of our product-development efforts, with significant effort on this Project Aries system, including what we believe will be an unprecedented number of assays at launch."
Another new development at Luminex is that once it launches the Project Aries platform, it will sell it directly to customers instead of through a distributor. Balthrop said that as of Jan. 1, Luminex will be ditching its distributorship arrangements with Abbott and Thermo Fisher Scientific, and begin selling its molecular diagnostic products worldwide through its own sales force.
"Our investors and customers should not perceive this as a significant risk," he said. "It's not like we're transitioning a tremendous book of business and just got started on the process – we've been working on it for a long time. So the transition, we believe, is going to be relatively minor and smooth."
Lastly, Luminex will continue to invest in its xTAG-based assay products. First, the company expects FDA approval for xTAG GPP "literally any day now," Luminex said, and the company is eyeing other multiplex panels that it can offer using the xTAG technology.
In addition, the company is working to make its xTAG offerings more automated and easier to use, with the aim of reducing both the assay turnaround time and user hands-on time.
"Those very complex, multiplex tests will be much easier to use in the future," Balthrop said. "The RVP product has been really great … but it's a little cumbersome and difficult to use compared to other molecular tests that we perform. But if [a customer] could have both — easy to use and comprehensive — we believe [he'd] want it. That's what we're working on."