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In Second Deal in 2 Days, Pyrosequencing Pens Diagnostics Agreement with GCI

NEW YORK, Nov. 6 – Pyrosequencing and Genomics Collaborative said Tuesday that they had agreed to jointly collaborate to generate genomic information that could be used to develop diagnostics and therapeutic products for cardiovascular disease.

The deal is Pyrosequencing’s second such deal in the diagnostics market in as many days. On Monday, the Uppsala, Sweden-based company announced that it would work with the Cleveland Clinic to co-develop rapid identification and diagnostic tests for mycobacteria.

Under the terms of its deal with Genomics Collaborative, Pyrosequencing said it would contribute its genotyping technology and intellectual property to the collaboration, while Genomics Collaborative would contribute its clinical samples and database.

GCI, which is already a user of Pyrosequencing’s technology, will use the systems to generate genotypes and to associate SNPs with a person’s predisposition to heart disease and to predict the right course of treatment.

Pyrosequencing will have exclusive rights to use any intellectual property that stems from the research to develop diagnostics while Genomics Collaborative will have the rights to use the information to develop therapeutics.

Pyrosequencing’s Molecular Diagnostics Business Unit in Westborough, Mass., and Genomic Collaborative’s labs in Cambridge, Mass., will be responsible for the collaboration. Richard Kuntz, chief scientific officer at the Harvard Clinical Research Institute, will serve as Pyrosequencing’s clinical advisor for the research program.

The deal marks Pyrosequencing’s seventh research collaboration, which the company hopes will help it to gain a toehold in the burgeoning diagnostic tools market.

“We have established a number of collaborations related to diagnostics,” Erik Wallden, Pyrosequencing’s CEO said in a conference call. “We are getting the technology validated around certain questions. Then we will formulate diagnostic tests and move into a commercial phase.”

Pyrosequecing did not say when it expected its collaboration with Genomics Collaborative to begin yielding products, but it did say that it hopes to deliver its first diagnostic product sometime next year. 

“The first products will be analyte-specific reagents,” a company spokesman said, noting that a user would need to have the company’s PSQ 96 or high-throughput system in order to run the assays. “We are shooting for sales in 2002.”

The next phase of the company’s diagnostics plan is to develop actual diagnostic kits that could be used in a doctor’s office or to conduct high-volume tests. The company did not give a target date for when such diagnostic tools might reach the market, but it did say that those tests would likely be based on new platforms.

Separately, Pyrosequencing said that after a slow third quarter the company was experiencing an upsurge in sales this quarter. Wallden said that that the company had had an “unusually good start” to the current period. 

The company reported sales of $2.5 million in the third quarter, compared with $1.0 million in the year ago period.

The company has so far placed more than 120 systems worldwide, including three of its recently launched high throughput PTP systems. The PSQ sells at a list price of $90,000, including software, the detection unit, and a start up kit of consumables. The PTP system is a customized system that can cost users in the neighborhood of $350,000.