Illumina CEO Jay Flatley on Diagnostics, the $1K Genome & China

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here certainly isn’t to compete directly with Sequenom. One of the things we’ve tried to make very clear—and we talked to them before we announced this—is that our goal is to make the whole field expand and continue to have them be a strong customer for us. There are couple components to this. One is that we think Verinata has the foundational IP in the field, and we think the field is being held back a little bit by IP overhang. There may be a way now that we can work that out. I’d like to see if that’s possible.

We clearly have a partnering strategy to take this technology to the market. We’d love to partner this (Verinata Health’s prenatal genetic test). Part of what we’ve done here is in recognition of the fact that in five years, this is going to be an IVD (in vitro diagnostic) market. People will want an FDA-approved test they can run in lots of labs. While the technology was split up, with assays being in other companies, and us having the platform, there was no really easy way to get an application through the FDA. We’d love to work with all these companies. We want to help Sequenom, help Ariosa (Diagnostics) and further our business as well.

X: What other kinds of diagnostics are you looking to tuck in?

JF: We’ve been very active in the cancer field, but these are not things we think are going to be acquisitions. They are tools we put out on the market. For example, we put out a somatic cancer panel. It’s to help accelerate CLIA (centralized clinical labs). They can add additional content on top of this. But it’s to get these labs to begin to do cancer vs. normal tissue screening. It’s not that likely we’re going to have a material acquisition in cancer anytime soon. But we’re continuing to watch the field. We have a lot of customers. It’s a very big market with lots of indications. I don’t think there’s any risk of us competing with our customers in cancer.

X: What about technology acquisitions? Moleculo is one of those. They’ll enable you to do more long-read DNA sequence lengths, right? Others, like PacBio, have tried to push ahead on that front to gain an advantage. What’s your rationale for that acquisition?

JF: The great thing about the Moleculo technology is that in order to get long reads, you don’t have to sacrifice throughput or cost. That’s the problem with the other systems. You sacrifice accuracy, with, say, [Oxford] Nanopore’s technology or PacBio. Here we get the accuracy of SBS (sequencing by synthesis) chemistry, plus the long reads. The incremental amount of (extra) sequencing you have to do is very small. It’s about one extra lane on a HiSeq machine to get a full human genome.

It opens up about 10 percent of the next-generation sequencing market that we think really wants long reads. It’s for areas like structural variations in cancer, or de novo sequencing—particularly in complex plant genomes. There are applications like meta-genomics, where you’re sequencing a complex soup of things, when you’re looking at a number of different organisms present, and you’re trying to ask, is this organism present? Having a couple hundred base reads sometimes isn’t enough to figure that out. Certainly there are some clinical applications, in being able to determine whether you’re dealing with a mutation in a gene, or whether it’s from the paternal or maternal strand, can make a big difference in the diagnosis.

Over time, this will be a standard part of what we do. There is some inherent improvement in accuracy when you move to long reads.

X: Are you really going to be able to get reads that go all the way up to 10,000 bases of DNA?

JF: Just the data they have already hits that. The chart I showed today, the maximum read length was 13,000, the average read length was 7-8,000 base range. We actually have an internal program where we can get up to 100,000 base reads. These are synthetic, so to be clear, these aren’t actually using SBS chemistry to read 10,000 bases in a row. It’s labeling the ends of short reads, and then reconstructing them afterwards. So we call it a synthetic long read. But the accuracy is astounding.

X: Why did you say no to Roche’s overtures again?

JF: We said no to Roche at our annual meeting in April, and that’s the last comment we made on Roche.

X: Yes, but they made some recent overture that was reported…

JF: There’s been a bunch of stuff reported in the press, but we didn’t comment on it.

X: So why remain an independent Illumina? Why does that make sense for the company and its shareholders?

JF: We’re certainly not wedded to that notion. We’ve said that openly. This was a matter of … Next Page »

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One response to “Illumina CEO Jay Flatley on Diagnostics, the $1K Genome & China”

  1. test123 says:

    guessing: SQNM is the next buy out target