Developer of life-science tools and integrated systems for large-scale genetic analysis, Illumina, Inc. (ILMN), recently launched its HiSeq X Five System and HiSeq 3000/4000 Systems to expand its line of sequencing system portfolio.
In addition, Illumina also unveiled another system to its consistently expanding next-generation sequencing (NGS) portfolio – the NextSeq 550 System, at the J.P. Morgan Healthcare Conference on Jan 12.
The HiSeq X Five System, a scaled down version of Illumina's renowned HiSeq X Ten System, enables laboratories to utilize Illumina's HiSeq X technology to perform whole genome sequencing (WGS) at a smaller scale and a lower capital investment rate. Notably, this system is expected to make high-throughput human WGS more accessible, and allow production-scale sequencing to be performed in more number of laboratories. This will naturally ramp up the demand for this system.
On the other hand, the HiSeq 3000/4000 Systems allow speedier yet cost-effective high throughput production-scale sequencing across multiple applications, when compared to Illumina's already existing HiSeq 2500, with help from the company's novel patterned flow cell technology. It is worth taking note that with the ability to process one or two flow cells simultaneously, the HiSeq 4000 can sequence up to 12 genomes and 100 whole transcriptome samples in 3.5 days or less.
Meanwhile, llumina's NextSeq 550 System is the first next generation sequencer that allows array scanning. The system's initial market reach will be for cytogenetics and prenatal genetic diagnosis, though the company has also laid out further market expansion plans in the areas of reproductive health and oncology.
Apart from these three launches, Illumina also announced new business strategies. Illumina will launch its 48-sample cost-efficient VeriSeq non-invasive prenatal test (NIPT) Solution in Europe in the second quarter of 2015. Currently, Illumina has its eyes on the CE-IVD mark for the NIPT software in Europe in early 2015.
Illumina is also working toward CE-IVD mark for the new VeriSeq NIPT assay and associated software in the first half of 2015. Currently, management is working with the FDA to determine the appropriate claims and required datasets for an NIPT assay, so that it can be used in the high risk and average risk populations.
In oncology, Illumina is conducting R&D in circulating tumor DNA. It also plans to release research-use-only kits in 2015, and operate a laboratory-developed test to work with its key partners. This reflects Illumina's commitment toward innovating advanced systems for the healthcare industry.
Notably, in its last reported third quarter 2014 results, Illumina's total sequencing revenue grew 47% year-over-year driven by record sequencing consumables, continued placements of the new instruments and growth in NIPT testing. We believe the launch of the three cost-effective yet high-throughput sequencing systems along with the competent business strategies adopted by the company will eventually help Illumina garner more profits in the near as well as the long term.
Zacks Rank
Currently, Illumina has a Zacks Rank #2 (Buy). Better-ranked stocks in the med-biomed/generic industry include Affymetrix Inc. (AFFX), Alexion Pharmaceuticals, Inc. (ALXN) and AMAG Pharmaceuticals, Inc. (AMAG). All these stocks sport a Zacks Rank #1 (Strong Buy).
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