Pacific Biosciences said last week that it has acquired sequencing-by-synthesis technology from Li-Cor Biosciences to complement its own single-molecule real-time sequencing approach.
The single-molecule sequencing technology, which Li-Cor had developed for a decade with funding from several federal research grants, uses so-called charge-switch nucleotides that carry a label at the gamma-phosphate position.
Li-Cor has several issued US and foreign patents as well as a number of pending US applications surrounding the technology, several of which PacBio will now control. Financial terms of the acquisition were not disclosed.
Lincoln, Neb.-based Li-Cor is “one of the few other companies [that] was working on what we would call long-read technology,” Pacific Biosciences CEO Hugh Martin told In Sequence this week. “When they indicated that they were looking to sell this aspect of their business, it was a great opportunity for us to expand our scope of technology that we have available to us.”
Martin would not say how the company plans to use Li-Cor’s technology but mentioned that the greatest similarity between the two firms’ approaches is in the area of gamma-phosphate labeling.
In fact, he said, the use of a label at the gamma-phosphate position of the nucleotides that get incorporated, rather than at the nucleobase, is “one of the biggest differentiations between any of the long-read technologies and all of the short-read next-generation systems.” The label gets cleaved off at the end of each incorporation cycle, leaving a natural strand of DNA that a polymerase can readily extend.
Another company that attaches labels to the gamma-phosphate is VisiGen Biotechnologies, a Houston-based company that is also working on a long-read real-time sequencing technology (see In Sequence 5/8/2007).
Li-Cor, Martin said, has “done a lot of work in this area, as we had done a lot of work in that area. We happened to use a zero-mode waveguide to reduce the signal-to-noise [ratio] … and they used different technologies, like charge-switching.”
Officials from Li-Cor declined to be interviewed about the company’s single-molecule sequencing program, or why the company decided to sell the technology.
The privately held firm sells instruments for photosynthesis and light measurements as well as carbon dioxide analysis. It has also developed infrared fluorescence labeling and detection systems for drug discovery and DNA sequencing. Li-Cor currently markets a gel-electrophoresis-based Sanger sequencing system, called the Li-Cor 4300 DNA Analysis System.
According to the abstract of a grant that Li-Cor won in 2004 under the National Human Genome Research Institute’s Advanced Sequencing Technology program, the company started to develop a system for de novo sequencing of single DNA molecules with long reads in 1998.
Li-Cor’s plan, the abstract says, was to develop an instrument that would deliver 500 raw base calls per second, or 1.8 megabases per hour. At five-fold coverage, the error rate for finished bases was going to be 1 in 10,000. The abstract estimated the cost for reagents and flowcells at 0.001 cents per finished base, or $10,000 per gigabase, “with the potential of laying the technological framework to enable future significant cost reductions.”
“We need to make sure that we have all the intellectual property we need, so we can build that large company.”
The three-year, $2.5 million grant, which was awarded to John Williams, a senior scientist at Li-Cor, had three goals. The company planned to fabricate and evaluate multichannel flowcells that would allow them to bead-dock DNA templates; control the flow of reagents, such as polymerases and modified nucleotide substrates; and perform “charge-switched partitioning” of released labeled pyrophosphates from intact labeled dNTPs, according to the grant.
Company researchers also planned to synthesize four different types of modified nucleotides, each carrying a fluorescent dye “with photophysics suitable for single-molecule detection” at the gamma-phosphate and a charge moiety at the nucleobase, the grant’s abstract states.
Finally, they were going to create mutant polymerase libraries and evolve polymerases for incorporating the charge-switch nucleotides with a “rate and fidelity as appropriate for meeting the throughput goals in conjunction with the multichannel flowcells.”
According to the grant abstract, instrumentation and image analysis were to be developed “independently” of the NHGRI grant.
According to NIH databases, Li-Cor received five other NHGRI grants to develop the technology. In 1999, it won a four-year, $700,000 grant entitled “A synthetic approach to single molecule DNA sequencing.”
Two years later, the company received a four-year, $2.2 million grant to use directed evolution methods to adapt polymerases so they would use gamma-phosphate-labeled dNTPs. According to the abstract, the company was going to separate cleaved labeled pyrophosphate from intact labeled dNTPs in a microfluidic system and identify it in real time by single-molecule fluorescence optics.
This grant was followed by a one-year, $150,000 grant in 2002 to develop a four-color, single-molecule fluorescence microscope, and a one-year, $120,000 grant in 2003 to develop data analysis techniques and algorithms for automated single-molecule base-calling from CCD images.
In 2005, the company received a six-month, $100,000 grant to develop another approach to single-molecule sequencing, called “electrokinetic sequencing.” According to the abstract, this method would use a “simple microtiter plate fitted with two electrodes,” in which more than 200 DNA molecules would be simultaneously sequenced in a single well at a speed of 10 nucleotides per second per molecule, and with read lengths of at least 20 kilobases.
Like Li-Cor’s “charge-switch” method, this one would use modified polymerases and gamma-phosphate-labeled nucleotides. The company was planning to develop “ultrabright fluorescent nanoparticles” as well as a “prototype two-electrode sequencing chamber” under the grant, and to characterize particle transport kinetics.
It is unclear which parts of the technology Li-Cor has actually developed. But as part of the technology acquisition, Pacific Biosciences obtained “a significant portfolio of key intellectual property developed under Li-Cor’s single-molecule sequencing program,” according to the company, including several issued US and foreign patents, as well as a number of pending US applications.
Li-Cor retained rights to intellectual property for sequencing enzymes, and maintains an “active program to outlicense these enzymes,” according to the companies. Pacific Biosciences might collaborate with Li-Cor on sequencing enzymes in the future, Martin said.
Since 2004, according to the US Patent and Trademark Office, Li-Cor has obtained at least four US patents related to single-molecule sequencing: No. 6,762,048, “Synthesis and apparatus for nucleic acid sequencing of single molecules by polymerase synthesis,” granted in 2004; No. 6,936,702, “Charge-switch nucleotides,” granted in 2005; No. 7,118,907, “Single-molecule detection systems and methods,” granted in 2006; and No. 7,229,799, “System and method for nucleic acid sequencing by polymerase synthesis,” granted in 2007.
As of last week, the company also held at least 10 related published US patent applications, which cover sequencing single molecules by polymerase synthesis, flowcell and microfluidics systems for sequencing, single-molecule detection systems, sequencing polymerases, field-switch sequencing, and charge-switch nucleotides. These applications were published between 2002 and 2007.
Martin would not say whether Pacific Biosciences plans to acquire additional intellectual property relating to its own technology, but noted that in order to use the technology to grow into a large company with the potential to change the sequencing industry, “we need to make sure that we have all the intellectual property we need, so we can build that large company.”
Regarding the acquisition of Li-Cor’s technology, “I would not say so much that we needed it, it’s more opportunistic,” he said.
In the meantime, Pacific Biosciences is working on an $80 million private funding round, which it plans to close by the end of the year.
The company is also currently evaluating all aspects of its technology, Martin said, in order to be able to say later this year what the performance specifications of its initial system will be, and how long it will take to develop it.