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MicroLab Diagnostics Acquisition 'Transformational' for ZyGem

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This article has been updated from a previous version that incorrectly referred to ZyGem's microbial fingerprinting technology as molecular fingerprinting.

By Ben Butkus

New Zealand-based ZyGem's acquisition of MicroLab Diagnostics this week is expected to accelerate the company's transformation from a provider of DNA extraction products to a purveyor of fully integrated DNA-testing platforms for the forensics, biodefense, and eventually clinical diagnostics markets, a company official said this week.

In addition, the official said that ZyGem has identified customers in academia, industry, and government to beta-test the company's DNA testing platform beginning later this year, with an eye toward commercial introduction in 2011.

In an interview this week with PCR Insider, ZyGem CEO Paul Kinnon said that the acquisition, the financial details of which have not been disclosed, is the culmination of about a year of discussions with MicroLab to determine how to combine MicroLab's proprietary microfluidic devices with ZyGem's existing portfolio of commercial DNA extraction reagents, and DNA detection reagents and assays still under development at the company.

"We've got technologies and patents that have been filed relating to the identification and detection of DNA from specific pathogens and specific infections," Kinnon said. "This will be incorporated into the platform."

Specific examples of ZyGem's technologies in this area include microbial fingerprinting, which describes amplification-based methods for detecting bioagents, and particularly bacteria, in a multiplexed fashion; and isothermal DNA amplification, which describes performing amplification reactions at a constant, single temperature to enable point-of-testing products.

Although these detection technologies are still under development at ZyGem, the company also currently offers a variety of reagent kits for extracting DNA and RNA in life science research, forensics, and agricultural applications.

Meanwhile, MicroLab owns an exclusive license to an IP portfolio covering microfluidic chip technology for DNA testing developed primarily by James Landers at the University of Virginia and University of Pittsburgh.

This technology, now owned by ZyGem, will enable the company to develop "a unique system that can integrate … extraction, amplification, and detection in a simple chip," Kinnon said.

"The biggest challenge for all these technologies is integration, and I think we've proved so far that we've got the ability to do that," he added. "Incorporating ZyGem's enzymes into this system gives us a major advantage in terms of ease of use, and the integration of everything into one simple system."

ZyGem's platform will also include a benchtop reader with a footprint of approximately 2 by 2 feet, Kinnon said. ZyGem has prototype systems that it has tested and validated in house.

At February's American Academy of Forensic Sciences meeting, ZyGem presented data demonstrating that its system produced accurate DNA test results in less than an hour, "comparable to results obtained with current technology requiring three separate instruments and five to 10 hours," the company said in a statement.

In an e-mail to PCR Insider, a spokesperson for ZyGem elaborated that this study was performed in house and compared the alpha ZyGem platform with "standard market-leading laboratory equipment" such as "Qiagen extraction and amplification, and [Applied Biosystems] detection" technologies.

This speed and accuracy, combined with the fact that the ZyGem system will be completely self-contained, will "significantly reduce the amount of sample and reagents that are needed while virtually eliminating the chances for handling error or contamination;" and will make the system "compact, easy to use, and cost-effective, making it suitable" for both laboratory and field use, ZyGem said. The company also plans to develop portable, handheld versions of its system.

Transformational Acquisition

The acquisition of MicroLab is ZyGem's first since the company was founded in 2005 after acquiring the intellectual property portfolio of predecessor PacificGem. That IP portfolio includes more than 600 thermophilic bacteria and archaea and 1,350 Antarctic fungal isolates originally discovered or isolated by the Universities of Waikato and Auckland, and from which ZyGem has derived many of its reagents, according to ZyGem's website.

"It's transformational for us in some aspects because we already had some patents filed to move this technology into a device system ourselves," Kinnon said. "So this actually accelerates our development. It also accelerates MicroLabs' development by providing a commercial opportunity and a little more bandwidth for the company. These are two companies with a lot of synergies in technologies and IP."

ZyGem will first develop its DNA testing system for the forensics market, particularly DNA-based identification, which Kinnon called "an important and growing market, because we need rapid and simple tests to be developed." The company will also take aim at government-based markets such as biothreat detection and environmental testing.

ZyGem is also eyeing the clinical diagnostics market, but that is "second-generation technology," Kinnon said. "We're already developing [diagnostic] assays, and we've got assays that we know are effective," he said. "We'll get into the second market with strategic partners, and make sure the product fits the needs of the marketplace, and actually develop it with [partners] to take it forward into the marketplace."

In terms of geographical targets, ZyGem will look first to the US, but has already had discussions internally and with distribution partners about how it might eventually be able to market the new technology elsewhere. "Obviously we've got a strong distribution network in Asia Pacific," Kinnon said. "But we'll probably focus on the Northern hemisphere initially."

As such, the company plans to expand operations both in New Zealand and in Charlottesville, Va., where MicroLab is based. "We'll want to commercialize products ASAP, so we'll be keeping both operations open in the short term," Kinnon said.

In addition, Landers, currently a professor of chemistry and mechanical engineering and associate professor of pathology at the University of Virginia, will become ZyGem's chief scientific officer, ZyGem said.

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