Who will be the next Illumina? A complete overview of the third-generation gene sequencing market in China

Who will be the next Illumina? A complete overview of the third-generation gene sequencing market in China

Next Generation Sequencing (NGS) has been standing on the top of the heap in the past few years. Riding on this steady upward trend, a slew of biotech companies has achieved great successes, such as Illumina and Beijing Genomics Institute. Nowadays, a new technology called the third-generation gene sequencing is gradually gaining attention and began to come to the forefront of the room. Some of the famous ones include Heliscope from Helicos, the SMART platform from Pacific Biosciences, and the nanopore sequencing technology from Oxford Nanopore.

Who will be the leader of the third-generation gene sequencing in China? Who will be the next Illumina or Beijing Genomics Institute? We do not know yet. In this article, I have discussed major Chinese biotech companies focused on the third-generation gene sequencing.

  1. Direct Genomics


As the pioneer in the field of single-molecule gene sequencing, Dr. Stephen Quake, the founder of Helicos, has launched the highly anticipated Heliscope in 2008. Unfortunately, due to its high price point, Helicos was not able to perform well, plunged into capital shortage, and eventually filed for bankruptcy in the end of 2012. In 2013, the U.S. bankruptcy court approved Helicos’ request to sell its intellectual property to Illumina, Life Tech, Fluidigm, and Complete Genomics. From then on, Helicos disappeared from the public horizon.

However, Helicos did not completely back out from the market. In 2012, Dr. Jiankui He finished his postdoctoral work at Dr. Quake’s lab and returned to China. He has founded Direct Genomics and continued the development of the single-molecule gene sequencing technology. Dr. Stephen Quake serves as the chief scientific adviser.

Inherited from and developed on the basis of Helicos’ technology, Direct Genomics has announced GenoCare, the prototype of its single-molecule gene sequencing, in 2015. In August 2017, GenoCare was put into production, and it is reported to sell 700 units in its first order. At present, GenoCare is applied in scientific researches and pending approvals into the clinical market.

“GenoCare is very accurate. Compared to MiSeq from Illumina, the leader in the gene sequencing field, their results are 99.7% consistent.” Commented by Jun Yu, the former deputy director of the Beijing Genome Institute at the Chinese Academy of Sciences.

Direct Genomics have obtained five rounds of financing since its first large-scale backing in 2015, amounting to a total of $28 million. Its current valuation is at $214 million. Worth mentioning is that Direct Genomics has also started building a large-scale production line in its Liantang industrial park in Luohu. Once completed, its production capacity is expected to reach 1,000 units per year, generating a total of $714 million annually.

2. Pacific Biosciences – SMRT technology

Pacific Biosciences – SMRT technology
Pacific Biosciences, also currently developing the single-molecule sequencing technology, is another rising star in the field and has been progressing rapidly in the past years. It has completed 6 rounds of financing, amounting to a total of $57 million. In 2010, Pacific Biosciences was awarded one of the fastest growing biotech companies. And in October of the same year, it entered Nasdaq. Currently, it mainly carries two platforms — PacBio Sequel and PacBio RS II.

Things began to look not so good since last year. In 2013, Pacific Biosciences has inked a cooperation agreement in gene sequencing with Roche, and as of December 2016, Roche suddenly ended it. In the heels of the news, Pacific Biosciences’ shares plunged 38%.

The decision to go alone in developing the third-generation gene sequencing has left Pacific Bioscience in severe dilemmas — the lack of financial capitals and an immature commercial model. From the Q2 earnings release of 2017 in August, Pacific Biosciences’ total revenue was $20 million, of which revenues from products and services has increased by 17%. On the other side of the coin, Pacific Bioscience has invested $16.9 million in R&D, accounting for 84% of total revenue, representing a net loss of $25.5 million.

The good news is that Pacific Biosciences’ research has been progressing smoothly, and single-molecule sequencing technology has also proved its value in the field. The stock market is confident in the company and its share value has been growing.

In China, a slew of sequencing companies has already introduced products from Pacific Biosciences to provide third-generation gene sequencing services, including Beijing Genomics Institute, Novogene, etc.

  • Beijing Genomics Institute
    Beijing Genomics Institute acquired a Pacbio RSii sequencer in May 2015 and purchased another PacBio Sequel in December of the same year. As a benchmark in the field, Beijing Genomics Institute’s attitudes and moves toward third-generation gene sequencing technologies deserve attention.

 

  • Tianjing Biochip Corporation
    In 2013, Tianjin Biochip introduced the Pacbio RS II system to provide third-generation gene sequencing services. Three years later, in September 2016, it further introduced PacBio Sequel, formed its PacBio single-molecule sequencing “dual-core” platform.

Since the inception of the third-generation gene sequencer in 2013, Tianjin Biochip has succeeded in sequencing and analyzing genomes and full-length transcriptomes of hundreds of species, including bacteria, fungi, insects, animals, plants, and humans.

In April 2016, Tianjin Biochip opened its third-generation gene sequencing platform and penned a strategic cooperation with Novogene to jointly expand the application of high-throughput sequencing in science and technology services.

  • Novogene
    Committed to becoming “the world’s largest sequencing service center,” Novogene has invested heavily in the third-generation gene sequencing technology. In early 2017, it has introduced 10 PacBio Sequel systems for genome-wide sequencing, full-length transcriptome sequencing (Iso- Seq ™), and targeted sequencing services. And only after six months, it introduced another 10 PacBio Sequel systems.

“Within a few months after we started operating the Sequel system, the demand for SMRT sequencing has increased dramatically and our production capacity has to double in a short term.” Commented by Dr. Ruiqiang Li, the founder and the CEO of Novogene.

Meanwhile, Dr. Michael Hunkapiller, the Chairman and the CEO of PacBio, has revealed that Novogen has become the largest user of the Sequel platform and the largest SMRT sequencing service center in the world.

  • NextOmics

In 2016, Wuhan NextOmics has penned a deal with Pacific Biosciences to acquire 6 PacBio Sequel sequencers, of which 3 are located in its Wuhan R&D Center, and the other 3 are located in its Beijing Laboratory.

According to people familiar with the matter, NextOmics has begun its research in the third-generation gene sequencing technology since its founding in 2011. In 2013, it has successfully developed a bioinformatic analysis platform based on Pacific Biosciences’ third generation single-molecule real-time sequencing system. This has paved the way for them to solve the technology bottlenecks in understanding complex genome assembly, microbiology macro genome assembly, full-length transcriptome analysis, and detection of human genome variation, fueled the progression of genomics research. At present, it has completed thousands of third-generation gene sequencing projects and published a number of articles.

In addition to PacBio Sequel, NextOmics has also introduced three GridION X5 nanopore sequencing platforms from Oxford Nanopore in September 2017 and became the first to release Oxford Nanopore (ONT) data in China.

  • Frasergen
    Frasergen is another major client of PacBio Sequel in China. In 2016, it has strike a deal with Pacific Biosciences to invest in 6 PacBio sequel sequencers, the first of which was set up in March 2016.

Frasergen is a high-tech company focused on both upstream and downstream of bioinformatics. Its main areas include third-generation gene sequencing, three-dimensional genomics studies, cancer genome detection, biological information software development, bioinformatics, genome database construction, genetic testing, etc. In May 2016, Frasergen has completed an A-round financing of $1.5 million from Hubei Hi-Tech Technology Industry Investment Limited Company.

  • Tianjin International Biology Medicine United Academe

In October 2014, the Third Generation Genome Sequencing Center of Tianjin International Biopharmaceutical Research Institute was officially launched and acquired 15 third-generation genome sequencers. It has inked collaborations with Tianjin People’s Hospital, Beijing Genomics Institute, National Supercomputer Tianjin Center, etc., providing full detection chain services from the acquisition of sequencing samples, to genomic sequencing, and to sequencing data analysis.

  • BioMarker
    In 2015, BioMarker has introduced three new gene sequencers, including one PacBio RS II. In December of the same year, PacBio RS II was formally put into use, complementary to its BioNanolrys system. Together with its Hiseq4000, Hiseq2500, DAProton, Miseq and other sequencers, BioMarker has established a sequencing platform, combining both the second-generation and the third-generation technology.

Worth mentioning is that in December 2016, BioMarker has initiated a joint lab with Pacific Biosciences and Gene Company. This is the first time that PacBio has conducted a strategic cooperation in China with a joint laboratory model.

  • Hanyu Bio
    Hanyu Bio, a long-term strategic partner of Shanghai Human Genome Research Center, is committed to the application and promotion of the third-generation and the second-generation gene sequencing technologies. Currently, it is equipped with a slew of third- and second-generation high-throughput gene sequencing platforms including PacBio RS II, MiSeq, Illumina HiSeq2500, etc.

 

  • Personal Bio
    Personal Bio has introduced PacBio Sequel in early 2016. At present, it has a range of the most updated sequencing systems, including Roche 454 FLX +, Illumina MiSeq, Illumina HiSeq 2500, Illumina NextSeq 500, Ion Proton, PacBio RS II, PacBio Sequel, etc. Dedicated to becoming the one-stop sequencing shop for biology, agriculture, medicine, and environment, it provides services in sample extractions, library constructions, gene sequencing, bioinformatics analysis, etc.

3. Oxford Nanopore

Oxford Nanopore and its nanopore sequencing technology are legendary. Oxford Nanopore originally collaborated with Illumina, the gene sequencing giant. Later, they ended their collaboration and Oxford Nanopore was considered as a competitor to Illumina. In 2016, Illumina sued it for product infringement, and the court ruled that Oxford Nanopore lost the case.

Oxford Nanopore immediately stops selling the banned MspA nanopore technology and switched to a new system – CsgG pore. Quickly, it launched a series nanopore sequence based on this new technology, including MinION, PromethION, SmidgION, and the latest GridIon X5. In the end of 2016, Oxford Nanopore has received $1.26 million funding, which will be used to expand its business territory, including Asia (especially in China).

Nanopore sequencing in China – NextOmics
Oxford Nanopore is just starting its business in China. From the publicly available information, only NextOmics has introduced 3 GridIon X5 systems in September 2017 so far.

4. New competitors? Beijing Meryl Technology

In June, one article named “There is no nanopore technology for commercial cancer early detection in the world, but Meryl Technology hopes to use it go to the front of medicine” raised my attention.

According to this article, Dr. Zhi Zhou has founded Meryl Technology in 2016 and it is working on developing nanopore early cancer detection machines which allow users to quickly confirm whether they have cancer and the stage of cancer through 10μl of body fluid (blood, saliva, etc.). At present, Dr. Zhou has completed its principle verification in the laboratory stage. The first prototype will be finished in June of 2017, and products (hardware and software) will be available around October. (But I have not found any related follow-up reports yet).

Meryl’s early cancer detection device is designed as a small hand-held item. The device can be connected to a phone or computer, and the data can be easily read. At present, the complete set of reagent development is finished, and the microfluidic chip used in the device can be mass-produced. The team is now negotiating with Peking Union Medical College Hospital, Xiamen University Affiliated Hospital, etc. to bring the technology to clinical research and development.

According to people familiar with this matter, Meryl has already finished a round of angel investment in May 2017. In August of this year, Meryl’s nanopore technology cancer diagnostic equipment project won the second prize of the “Kirin Cup” Innovation and Entrepreneurship Competition in Shenzhen.

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