In a bid to expand in personalized healthcare, Illumina Inc. (ILMN), a major developer of life science tools for large-scale genetic analysis, recently formed a strategic alliance with Lockheed Martin (LMT), a global security and aerospace company.
Post-transaction, the two companies are expected to work on scalable and reasonably priced genomics solutions. The science of studying genomes or DNA is known as genomics. In health care, analyzing a person’s DNA sequence data can provide a better understanding of health risks, thus enhancing the scope for more accurate medication.
According to both Illumina and Lockheed Martin, armed with genomic data across large populations, public health and wellness officials will be better positioned to efficiently address health concerns, reduce health care costs and improve overall quality of life.
This partnership will effectively combine Illumina’s next-generation genetic sequencing tools with Lockheed Martin’s knowledge in large-scale information systems and integration, to meet the growing healthcare needs of nations as they begin to integrate genomics within their national health systems.
We are optimistic about Illumina’s expansion strategy through the development of strategic partnerships with therapeutics and diagnostic services providers.
In Nov 2014, to help combat the Ebola epidemic in West Africa, Illumina had teamed up with the U.S. Agency for International Development (USAID) and the Broad Institute of MIT and Harvard. This public-private partnership aims to aid those on the ground fighting against the spread of the virus. According to the company, genome sequencing of the virus is critical for genomic surveillance; hence Illumina’s role in this situation is vital for the development of diagnostics, vaccines and therapies.
In the same month, Illumina had also entered into a strategic agreement with leading in vitro diagnostics player bioMérieux to launch a Next-Generation Sequencing (NGS) epidemiology solution for service labs. The solution will combine Illumina’s MiSeq sequencing system with a jointly developed pathogen genome database based on bioMérieux’s culture collection. According to Illumina, this will enable public health and hospital microbiology laboratories to contain an epidemic, avoid transmission of infectious agents, and improve hospital practices where needed.
Although primarily a defense contractor, of late, Lockheed Martin has decided to diversify its business with a foray into healthcare. Illumina is optimistic about this new endeavor at Lockheed Martin and recognizes the latter’s potential to gradually emerge as a global health care provider, buoyed by the breadth and depth of its operations and strategic relationships around the globe. Illumina, on its part, expects this partnership to develop best-in-class solutions to realize the full potential of nation-scale sequencing.
Illumina currently holds a Zacks Rank #3 (Hold).
Other Stocks to Consider
Investors interested in the biomedical sector can also consider stocks like Affymetrix Inc. (AFFX) and Amgen Inc. (AMGN). Both the stocks sport a Zacks Rank #1 (Strong Buy).
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