This article was originally published May 8.
NEW YORK (GenomeWeb) − Qiagen has pushed back the market entry of its GeneReader next-generation sequencer to 2015, citing updated specifications and "challenges in the systems integration phase." In the meantime, the company remains committed to the next-gen sequencing market through its sample preparation and bioinformatics products.
Qiagen had originally planned to launch the GeneReader this year, and already placed pre-commercial versions with a number of early customers. During a conference call to discuss the firm's first quarter earnings last week, CEO Peer Schatz said Qiagen now expects the GeneReader to enter the market 12 to 18 months from now, noting that "the initial focus will be partnering with customers in biomedical research, clinical research, and clinical diagnostics."
Asked about the reasons for the delay during a question and answer session, Schatz said the firm has updated certain specifications of the GeneReader to "make them more amenable to a better profile of the product overall, and also better economics."
The company had to adjust certain chemistries and other components of the workflow, he said, which has "pushed out timelines of systems integration, the design lock, and therefore the overall timelines."
"We are committed to the basic design targets, so the targeted applications in clinical research and diagnostics, and the platform technology."
Qiagen had never revealed complete specifications for the GeneReader but said as recently as November that the system will initially process up to six flow cells at a time, which can be added continuously, a feature it believes will appeal to clinical laboratories. The instrument focuses on sequencing gene panels, and each flow cell would generate up to 2 gigabases of data, the firm said previously. It is currently unclear which of these specifications, if any, have changed.
Qiagen acquired the GeneReader technology in 2012 when it bought privately-held Intelligent Bio-Systems for an undisclosed price. "We do expect to provide a good return on this investment, and as with all of our R&D programs, we monitor the value creation potential on a constant basis," Schatz said.
"The availability of a [sequencing] system is certainly part of the plan going forward, and we're on track to get there," he said, though the company's current focus in the area of NGS will remain on universal solutions for sample prep and bioinformatics that can be used with any NGS platform.
Schatz said Qiagen expects at least $50 million in annual sales from its NGS sample prep and bioinformatics products, including new launches this year, and expects "strong growth" in this area.
"We are seeing such good success on the universal portfolio currently, and such good uptake, that our teams are very focused right now on just making sure we have an almost ubiquitous presence with these universal capabilities before we focus too much on a specific segment of the market," Schatz said. "From that perspective, next-gen sequencing is an important integral part of our vision going forward."
He pointed out that Qiagen remains the "unrivaled leader" in nucleic acid extraction, which is used to prepare samples for NGS as well as many other analysis methods. Qiagen's portfolio for NGS customers consists of these as well as more NGS-specific products. "While NGS is an important trend, keep in mind that less than one to two percent of all biological samples being processed in laboratories around the world are actually going into next-gen sequencers," he noted.
Among new universal sample prep products already launched this year, Schatz pointed out the REPLI-g kits for isolating and amplifying nucleic acids from single cells. "This is one of the hottest areas of research these days, and we are very quickly seeing strong demand for these products," he said.
He also mentioned the QIAxpert, a microfluidic UV/VIS spectrophotometer to assess the quality and quantity of nucleic acid samples, which addresses a market with annual sales of about $250 million that is currently "mostly served by some very dated technologies."
Regarding more NGS-specific sample prep products, Qiagen plans to expand its gene enrichment panels this year. Last year, it launched a number of gene panels for different cancers and will soon release updated versions of these. The new panels will have "some unique features," and the company sees them as "a very sizable market opportunity," Schatz said.
"We've seen the first publications come out, showing superior performance of these panels that include the combination of specific gene tests into next-generation sequencing panels in a very fast and slick workflow, dramatically reducing the amount of sample material required for any sequencer, and also significantly accelerating the time to panel creation," he said.
In terms of new bioinformatics tools for the downstream analysis of NGS data, Schatz pointed out the recent launch of the CLC Cancer Research Workbench as well as the early access program for Ingenuity Clinical, which currently has 20 clinical laboratories participating.
In addition to selling products for use with NGS, Qiagen is also "discussing NGS options" with its pharmaceutical partners to develop companion diagnostics, which presently only include PCR tests, Schatz said. Qiagen has more than five master collaboration agreements with pharma firms, including Eli Lilly and Bayer, to develop companion diagnostics, and more than 20 projects with pharmaceutical companies in oncology and other areas.
"NGS holds many promises for improving the outcome of patients, and the technology is developing very quickly, but there are still some limits," Schatz cautioned, for example the cost involved in profiling several markers in parallel, such as DNA, fusion transcripts, DNA methylation, and small RNA.
"This is actually prompting pharma companies to push us to consider additional technologies beyond our PCR and NGS offerings that can generate the data they need for clinical trials, and even as companion diagnostics," he said.
"In particular, we are hearing requests for systems that allow so-called multi-analyte, multi-modal testing and that can integrate various technologies into low-cost tests that need to be performed only once to get the test results across all markers."
One indication that Qiagen is still committed to next-gen sequencing is the nomination of Elaine Mardis, co-director of the Genome Institute at Washington University and an expert in sequencing technologies and their clinical applications, to its supervisory board. "Her addition to our board is very timely as well, given our initiatives to expand Qiagen's presence in personalized healthcare with the adoption of new technologies and bioinformatics to deepen the understanding of cancer and other diseases," Schatz said.