68.3 F
San Diego
Thursday, Jun 8, 2023

Edico Brings Valuable Tech Tools to Illumina

Call it a need for speed.

Illumina bought data processing specialist Edico Genome for $100 million as part of a bid to expand genomics testing in research and health care. Critical for wider adoption: quickly analyzing heaps of data.

More and more employ Illumina machines for purposes like uncovering disease risk, generating ever-larger amounts of data. That’s where Edico Genome enters the picture. Its Dragen platform reduces file sizes and quickens analysis, a critical second step in making sense of genomics information.

Both companies are based in San Diego. The deal, announced May 15, calls for folding Edico’s more than 50 employees into Illumina, a genomics giant with a nearly $39 billion market cap.

- Advertisement -

Adding Edico’s horsepower to Illumina’s sequencing process looks to speed up test results — of immense importance to a doctor deciding on the best course of care, for instance.

“The business takeaway here is Illumina is increasingly levered to clinical diagnostics,” said Leerink analyst Puneet Souda. “In order to succeed in that, turnaround times will matter.”

Flexibility in Data Analysis

Souda said Edico’s Dragen platform brings several advantages besides speed and lessened storage. The technology reduced analysis costs. It’s also compatible with various cloud storage and analysis pipelines.

“It gives you flexibility from a data analysis perspective. Not everyone is going to use one type of pipeline,” Souda said. He added the acquisition positions Illumina well, but noted the analysis field remains competitive and is rapidly evolving.

As a differentiating factor, Edico’s technology encompasses both the cloud and the Dragen processor, which pops into sequencing machines.

Allowing a Focus on Science

Presently, many Illumina customers stitch together a few tools for secondary data analysis. The purchase moves Illumina toward a “push-button, standardized process,” according to the company.

“That’s going to drive adoption of sequencing and allow our customers to focus on their science rather than have to worry about what software and what process,” said Susan Tousi, senior vice president of product development at Illumina. She added to count on further integration between the two companies’ tech as time goes on.

As reasons for the deal, Tousi cited Edico’s platform and software, its intellectual property and little overlap between the companies. For the latter reason, layoffs aren’t anticipated.

“We find this group to be highly complementary to what we have,” Tousi said. “They bring a unique technical expertise into our group.”

Beyond this purchase, Illumina has sought to usher sequencing into the mainstream with easier-to-use machines. The company also played a pivotal role in lowering DNA test costs, enticing more customers. The company is eyeing a $100 test to decode the human genome, one-tenth the cost of a 2014 milestone.

While Ilumina will absorb Edico’s employees, Edico CEO Pieter van Rooyen won’t be joining.

Edico CEO Moving On

“I’m moving on. I will be taking some time off and plotting my next idea,” said van Rooyen, noting he plans to stay in San Diego. He also co-founded Zyray Wireless, which was purchased by Broadcom, as well as co-founded ecoATM, bought by Outerwall.

In 2013, van Rooyen co-founded Edico, a graduate of San Diego startup incubator EvoNexus. The company started with four employees, largely with telecommunications backgrounds.

“It was a willingness to dial it in to something new and learn technologies, and that’s what really made us successful,” van Rooyen said. “We were able to bridge that gap.”

Edico counts companies, hospitals and universities among its customer, which previously had rooms full of servers to crunch data, often at a comparative snail’s pace to Edico’s technology. Illumina, according to the company, will take on Edico’s licensing and partnering deals.

Van Rooyen said Edico’s technology fits with Illumina’s direction.

“If you deploy a sequencing instrument in a hospital setting, they’re not interested in analyzing data. They’re really only interested in getting an answer, something actionable.”

Particularly in some newborns, genomic test results can’t come soon enough. Tests can identify the root cause of a condition, facilitating early intervention that can head off lifelong issues — or even death.

Genetic diseases are the leading cause of death in infants in North America, affecting an estimated four percent of newborns. Rare genetic diseases also account for about 15 percent of admissions to children’s hospitals.

Edico, Illumina and other organizations this year earned a Guinness World Record for analysis and interpretation of life-threatening genetic variations in 19.5 hours at Rady Children’s Institute for Genomic Medicine.

“We have had tremendous success at Rady’s for years using Edico’s Dragen coupled with Illumina sequencers to accelerate the delivery of genomic insights for critically ill newborns,” Stephen F. Kingsmore, CEO and president of Rady Children’s Institute for Genomic Medicine, said in a statement. He added a goal is to ensure hospitals around the world can access the technology.

Monetizing Edico’s Partnerships

As of January, Edico Genome held 15 patents covering a range of technology.

David Crean told the San Diego Business Journal in January that Edico’s intellectual property makes it a target for acquisition. Crean is the managing director of Objective Capital Partners, leading the firm’s life science investment banking deals.

Reached on May 15 a few hours after the news broke, Crean took interest in Illumina gaining Edico’s partnerships as part of the deal.

“They’re now picking up additional revenues and monetizing Edico’s partnerships,” he said. “That’s significant.”


Featured Articles


Related Articles