Two closely watched genetic sequencing technology firms who had been unhappily affiliated have now divorced. UK-based Oxford Nanopore announced on 15 November that it has raised £56.4 million — mostly by selling the 13.5% of its shares that had been owned by San Diego-based Illumina since 2009.
Illumina had purchased the shares for $18 million in pursuit of an alliance that would give it a foothold in nanopore sequencing technology, in which different genetic bases are identified by changes in electric conductance caused when they are fed through a nanoscale pore. The technology is seen as highly promising because it offers the potential for very rapid sequencing at low cost. But after Oxford announced in 2012 that it was commercializing a version of its technology that is slightly different from the one in which Illumina invested, the two companies severed commercial ties and Illumina licensed a competing nanopore technology.
Oxford also said that it will begin allowing scientists to register to test its MinION portable genetic sequencer on 25th November in a “substantial but initially controlled programme designed to give life science researchers access to nanopore sequencing technology at no risk and for a refundable deposit of $1,000.”
The impetus for Oxford’s divestiture of Illumina shares isn’t yet clear. As computational biologist Mick Watson of the University of Edinburgh writes on his blog, Illumina may have figured that it would never make much money from the investment, as Oxford is now staking out a competitive position. “The simple answer may be that Illumina had nowhere to go with this,” Watson writes. “Therefore this is probably the logical conclusion — sell the shares and compete, try and beat [Oxford Nanopore] at their own game.”
So far, financial analysts give Illumina the edge in this game: “We continue to believe that [Illumina] has the dominant platform for the foreseeable future,” wrote Goldman Sachs analyst Isaac Ro in a research note on 15 November.
Scientists who have tested MinION so far have agreed, though they been impressed with the technology. Geneticist Yaniv Erlich of the Cambridge, Mass. Whitehead Institute for Biomedical Research wrote earlier this month that “MinION (and presumably its GridION scale-up) is far from being a threat to Illumina.”
Follow Erika on Twitter @Erika_Check.