NEW YORK – Singular Genomics Systems said on Wednesday that Adaptive Biotechnologies and Exact Sciences will be among its first customers for the new G4 DNA sequencer.
Both companies were part of the early-access program for the new platform, Singular cofounder and CEO Drew Spaventa told investors on a conference call following the release of the firm's fourth quarter and full-year 2021 financial results, and both have submitted orders for the instrument.
"We are pleased with the early support of the program and that companies of this caliber have elected to take the next step in what we hope will be a growing and mutually beneficial relationship," Spaventa said.
On the call, he also shared data from an unnamed early-access site, discussed reagent pricing for the firm's near-term sequencing options, announced a Singular Genomics lab that will validate sequencing applications for prospective customers, and revealed a technology access program (TAP) for Singular's other platform in development.
Singular "delivered a solid update, including: robust performance stats from additional early-access customers revealing the G4 is ready for launch, more aggressive pricing (~20 to 30 percent below Illumina), and its first two orders from clinical diagnostics labs," Cowen analyst Dan Brennan wrote in a note to investors.
Adaptive and Exact did not immediately respond to a request for comment on their results from the early-access program and their decision to purchase the G4. In November, Spaventa had provided some sequencing stats obtained by two unnamed early-access partners, now revealed to be Adaptive and Exact.
According to Singular, Adaptive achieved average read counts of more than 150 million reads per flow cell and accuracy of up to 99.8 percent while using 150 cycle kits for targeted sequencing panels, while Exact obtained 170 million reads per flow cell and also accuracy of 99.8 percent on targeted panels and exome libraries that used 200 cycle kits.
Spaventa revealed similar details for another, unnamed early-access partner. A commercial contract research organization using 200 cycle kits for liquid biopsy testing, he said, achieved average read counts of more than 200 million per flow cell, with more than 80 percent of bases at or above Q30 accuracy, or 99.9 percent accuracy.
To help get more customers to join Adaptive and Exact, Singular is starting an internal "customer care lab" to validate customers' sequencing applications and optimize them on the G4 before they make a decision to buy the platform.
"This will be a courtesy service offer to prospective new customers who are interested in seeing data prior to purchasing a system and designed to streamline their adoption of a new technology," Spaventa said. "This will also serve as an opportunity to work with customers on specialized kits such as HD-seq and XR-seq."
In addition, Singular promises customers lower costs compared to current benchtop sequencers, including those from Illumina. Spaventa said that "all customer types — low-, mid-, and high-volume — will see cost savings with the G4, in some cases, up to 50 percent or more over current benchtop offerings."
Spaventa said in a follow-up interview that the list prices for some of its higher-throughput kits could be in the range of $15 to $40 per Gb, depending on the specific kit. "From there, we'll discount into the low teens [dollars per Gb] with volume discounting," he said.
The company will "get even more aggressive on pricing" with the G4x4, a setup for high-volume customers that would include four G4s operating together and is slated for release toward the end of the year, he said. With volume discounting, sequencing on the G4x4 could be below $10 per Gb, he said.
Singular officials also noted that they have not provided formal guidance on the number of instruments they intend to ship this year and how much revenue that would translate to. The firm will not recognize revenue until after it ships instruments; moreover, revenue recognition is contingent on a validation process by the customer. "This could result in [revenue] being recognized in subsequent periods," said Dalen Meeter, Singular's senior VP of finance, adding that the company hopes to eventually "structure its terms and conditions to enable revenue recognition upon shipment."
Meeter noted that the consensus Wall Street estimate is for the company to sell approximately 40 instruments in 2022. "We're building units to achieve this," he said. "I would say that the 40 units isn't a layup by any means. We're bringing in new technology and a new product to market for the first time, but it's definitely an achievable challenge."
Spaventa added that the firm likely won't provide specifics on orders until the G4 has been out on the market for several quarters.
For Singular's other instrument — a sequencing-based platform for spatial, single-cell, and multiomics analysis, called PX — the firm will launch a technology-access program later this year. Singular CSO Eli Glezer said it will be different from the EAP for the G4. "What we hope to do through the TAP is work with some thought leaders and potential large customers in this area to help guide us in the most promising directions there. … We will work with people closely on those applications, maybe develop customer panels specific to those needs."