Illumina & The Evolution of Next-Generation Sequencing | In Practise

Illumina & The Evolution of Next-Generation Sequencing

Former Director at Illumina, Thermo Fisher Scientific and Pillar Biosciences

Learning outcomes

  • How the market evolved from microarrays to next-gen sequencing
  • Risk of obsolescence of biotechnology
  • Why Solexa’s intellectual property is unique and how they entered NGS
  • Why Life Technology couldn’t compete with Solexa’s technology
  • Use cases of long vs short read sequencing
  • The competitive advantage of Illumina in short-read NGS
  • Potential risks and opportunity for GRAIL
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Executive Bio

Dale Yuzuki

Former Director at Illumina, Thermo Fisher Scientific and Pillar Biosciences

Dale is a trained molecular biologist with over 7 years of clinical research and 23 years of corporate experience in biotechnology. Dale marketed and sold microarray and next-generation sequencing instruments in the field for Illumina for 6 years before joining Life Technologies which was later purchased by Thermo Fisher as Illumina’s largest competitor in clinical sequencing. He has also worked for 6 years at Qiagen after starting his career as a cancer and immunology researcher at the John Wayne Institute. Dale more recently worked for SeraCare Life Sciences, Pillar Biosciences, Helligenics and works closely with various oncology and liquid biopsy startups today. Read more

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Dale, can you provide a short introduction to your background in the industry?

It was about 20 years ago and I had come back from an overseas stint, in mainland China, and before leaving, I had been working, for China, in the research laboratory. I had been working at a small cancer institute, in Santa Monica, California, working on different research problems around skin cancer; specifically, melanoma. Way back in the 90s, I was working on tumor immunology, when tumor vaccines were considered a bit of a pipe dream.

When I came back to the US after a couple of years abroad, I started working for a small US division of a German company, called QIAGEN, who actually makes the sample preparation kits and consumables that are used to purify RNA from a biological sample. For example, in the current COVID-19 crisis, you have throat swabs, naso-pharyngeal swabs, that are diluted into a medium. What the QIAGEN kit will do is purify the RNA, the nucleic acid, from the potentially infectious SARS coronavirus in that sample.

QIAGEN, at that time, was selling to the research market and not so much to the clinical market, because it was much, much smaller. That was 20 years ago, working for a sample preparation company and I then joined Illumina in 2003, when they only had a single product. They then grew into a microarray company and, in 2005, I moved from San Diego, where I had lived, to the East Coast, to sell these microarray chips, as well as the microarray instruments that would read these DNA chips, to the National Institutes of Health, here in the DC area.

In 2007, Illumina acquired a small startup, called Solexa. I was working in the field, selling microarrays to the National Institutes of Health, at the time when Illumina acquired a small startup called Solexa, and launched the first genome analyzer in 2007. I sold this NGS equipment to the first genomics customers, at the National Institutes of Health and saw that market just explode and take off. I moved to a startup and then moved to a company called Life Technologies. Life Technologies was the merger of Invitrogen and Applied Biosystems. Applied Biosystems was and still is, the market leader in the first-generation sequencing instruments, in something called Sanger sequencing. It was a good €400 million market for them. They then launched a product called SOLiD, which was the competitor to the genome analyzer. I was involved in sales and field marketing. At that time, Life Technologies purchased another small startup, called Ion Torrent, and shifted their next generation sequencing efforts from the SOLiD platform to the Ion Torrent platform and they still sell and market that platform today; it is now called Genexus.

Nonetheless, that was 2013 or so when Ion Torrent and Illumina were battling it out in the marketplace. The last five years, I have been moving towards clinical applications, working for several different companies involved in different applications of using next generation sequencing, for cancer diagnostics. One was a company called SeraCare, acquired by a conglomerate called LGC and they launched their precision medicine platform. What we sold there were controls for cancer testing, for tumor as well as liquid biopsy.

Pillar Biosciences was another start up, providing reagents for that tumor testing, as well as liquid biopsy. I worked for another small startup, called Singlera, working on early detection for colorectal cancer. Again, this liquid biopsy was on the upstream side, looking at detection of cancer, rather than therapy selection, which is further downstream. My last major role in liquid biopsy was for a startup, called Inostics, which was acquired by a Japanese hematology company, called Sysmex. Sysmex Inostics was also liquid biopsy, mainly selling to pharma customers.

That’s me. 20 years of industry experience, seven years of behind-the-bench experience and lots of experience in talking about both clinical and research applications of this technology.

Can we take a step back to the late 90s. Can you describe microarrays and the machine and instruments you were selling, prior to Illumina acquiring Solexa?

Your audience is, very likely, familiar with the term PCR now, given there are PCR-based tests for coronavirus. In the mid-90s, around 1995, 1996, Roche Molecular launched something called a TaqMan system for a certain type of blood cancer, to detect a certain molecule in the bloodstream. It was called BCR-ABL and this TaqMan test was a clinical test, using PCR technology. This was in the mid-90s. This is the clinical application of technology that was a research workhorse.

Throughout the 90s, a small startup company in Silicon Valley, called Affymetrix, was publishing remarkable papers, being able to synthesize DNA on a microchip, using photo microlithography technology. Instead of etching wires, you actually build DNA strands on a microchip. There are two different approaches to what Affymetrix was able to do, as well as using academic efforts, using what are called spotted microarrays. One was to use a number of different genetic technologies to get 1,000 or 2,000 genes and spot them on a one inch by three inch glass slide. Then, using fluorescence, to be able to label and sample them. Say you have a blood sample from a patient, you purify the RNA, you label the RNA from that sample, using fluorescence, you hybridize it to the chip and now you can assay, you can test, 2,000 different genes at once.

I just referred to the TaqMan platform and the PCR technology; that is just for one gene. You are just looking for one thing. Here, you can take a look at 2,000 things, from that single sample; it was blowing people’s minds. I went from one experiment a day to 2,000. What Affymetrix was able to do was to take it to another level. Because of the photo microlithography, they were no longer limited by how small the pin is and being able to dip little dots on a glass slide. Here, they are using photo microlithography, able to build small snippets of DNA on a microchip – roughly the size of a slide; maybe a little fatter or a little shorter, but about two by three inches large – and they would have a scanner and a fluidics device to be able to interrogate, literally, 10,000 genes.

Starting from about 1985, 1986, the Human Genome Project was progressing in its growth and trajectory. In the mid to late 90s, more and more genes were being discovered and Affymetrix was building a head of steam, up to when the Human Genome Project was finished, around 2002, when a good draft was made and published, with a news conference. Everyone remembers Bill Clinton, Craig Venter and Francis Collins congratulating each other with commercial and academic efforts coming together. But nonetheless, that timeframe of the late 90s to the early 2000s, was when microarrays exploded onto the scene. Affymetrix became a darling, with hundreds of millions of dollars in sales; just stratospheric growth.

What was the value proposition? The value proposition was, as I mentioned, 10,000 genes at once. You have got a $400,000 scanner, a big box that sits on a bench, where you can scan, maybe, 10 of these chips a day. For the investigator, it’s 10 samples times 10,000 genes. As far as each gene chip goes, it could cost $500 or $1,000 apiece. So you say, what laboratory is going to spend $10,000 a day on just the consumables, on top of a $400,000 instrument? Well, there were plenty of customers that wanted this information and this type of information was what’s called gene expression information. Hundreds, thousands, ten thousand; there are 20,000 genes in the human genome and that was the goal. Certainly, Affymetrix were built that way too. The whole genome is, basically, all the genes expressed – called the transcriptome – as a chip.

This was right at the height of the genome project, early 2000s, and there was a big boom, both in valuation and stock activity. Not far from where I live, in Gaithersburg, Maryland, there was a company called Gene Logic. All they did was buy Affymetrix instruments and run gene expression instruments for pharma. They had a stellar stock valuation; it was just completely absurd. And it crashed.

How did Illumina get into this market of microarrays?

At that time, it was 1999 or so, when Illumina was founded, with John Stuelpnagel, Jay Flatley and Mark Chee; actually, Jay was brought in a little bit later. Mark Chee was a leader at Affymetrix and he brought in several key scientists from Affymetrix, to go ahead and do things a little differently. They were going to come up with their own method of microarray. John Stuelpnagel had the foresight that the ability to synthesize DNA was a key raw material. He got some very clever key scientists, from Eastern Europe, who were working on synthesizing protein and, instead of synthesizing peptides – which are small amino acid sub-blocks of larger proteins – he had them work on DNA. It was funny talking with him in the early days when he said, proteins are hard; DNA is just really, really easy, in terms of the chemistry and the synthesis. There are 20 different amino acids, they all have different characteristics and synthesizing peptides is nasty and difficult to do.

Illumina saw that as a key raw material and was able to manufacture large numbers of different types of DNA snippets, at extremely low volume, at extremely low cost. When I say low volume, at that time, you can imagine a room full of DNA synthesis equipment, each one with columns and large bottles of chemicals and acetonitrile and all the bits and things that you need for synthesizing DNA; it wasn’t miniaturized. What Illumina did was to put it in 96-well plates and, ultimately, in 384-well plates, to where the DNA synthesis could occur in a very, very small volume, saving a lot on the cost of goods and then being able to scale, producing hundreds of thousands of different snippets of DNA. When I say snippets, these aren’t very long. They might be 40 or 50 nucleotides in length, so they are not very long. But with 50 GATC bases, it’s enough to be very, very specific for the gene of interest.

When Illumina went to market in 2001, 2002, they were selling what is called oligonucleotides, which are small snippets of DNA to the research market.

These were cheaper?

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Illumina & The Evolution of Next-Generation Sequencing

November 10, 2020

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