Illumina Bets Again on Oxford Nanopore, Joins $28M Investment in Cheaper Gene Sequencing

2/1/10Follow @xconomy

San Diego-based Illumina has made its second big bet in the past two years on U.K.-based Oxford Nanopore Technologies. The investment is another show of confidence in a startup that boldly promises to sequence entire human genomes far faster and cheaper than anything on the market today, possibly for as little as $1,000 per genome.

Oxford Nanopore is announcing today it has raised $28 million in venture capital (17.4 million pounds) from Lansdowne Partners, IP Group, Invesco Perpetual, new U.S. investors who aren’t being identified, and DNA sequencing giant Illumina (NASDAQ: ILMN). The new cash comes one year after Illumina agreed to invest $18 million in Oxford Nanopore and struck a partnership to sell, market, and distribute Oxford’s DNA sequencing machines when they reach the market.

Sequencing of complete individual human genomes has been one of the big ideas in biology over the past couple of years as companies are racing to make the process better, faster, and cheap enough to potentially make it a mainstay of everyday medical research. Illumina made waves last month when it said it had refined its processes enough to make it possible to sequence whole genomes for $10,000 (albeit with a machine that costs $600,000). Competitors like Carlsbad, CA-based Life Technologies, Switzerland-based Roche, Cambridge, MA-based Helicos Biosciences, and Mountain View, CA-based Complete Genomics are all racing to stake their own claims to dominance in the era of more practical, common DNA sequencing.

Oxford Nanopore is attempting to disrupt that existing order with an entirely different technology, based on what I gathered a couple weeks ago from a conversation with CEO Gordon Sanghera and Spike Willcocks, the company’s vice president of business development. I met these Brits while they were in San Francisco attending the JP Morgan Healthcare Conference.

How is Oxford Nanopore really different? The existing sequencing players use common polymerase chain reaction (PCR) techniques to amplify DNA in a biological sample. They tag the individual units of DNA with fluorescent markers. And they use sophisticated cameras to read the flow of those fluorescent tags, Sanghera says. These steps all have their disadvantages, he says. The PCR requires laborious sample preparation, the fluorescent tags add some cost per individual DNA unit, and the cameras make for expensive capital equipment. Then there’s the challenge of having computing power and the good software required to store, analyze, and visualize all the images from that sequencing.

Oxford Nanopore is taking a different tack on this problem. It doesn’t require any PCR amplification of a sample, any fluorescence, or a camera. Instead, the company’s machine runs the sample through very small (one-nanometer wide) pores. The DNA passes through these nanopores, and instead of taking an image, the Oxford machine records the electrical charge that’s associated with each individual unit of DNA, like a signature.

There is a ton of sophisticated chemistry that goes into making this happen, which I don’t pretend to understand in great depth. But Sanghera insists that the technology has earned some serious validation in recent years. A 2008 paper in Nature Nanotechnology showed that this method of DNA sequencing was comparable to the existing standards. The end result is a digital readout of a full genome sequence that’s more precise than existing methods, Sanghera says.

“The current systems look like 1970s mainframes,” Sanghera says. “We think we can bring about a transformation that is a bit like the transformation to the PC.” He adds: “We don’t talk about the $1,000 genome, but we do see this platform providing a step-change.”

It certainly sounds amazing if the chemistry has really matured. But even if it has, there are still many vital business questions that these executives aren’t ready or willing to answer in public. Things like the speed and accuracy of their tool. Or the exact price of the tool, and the cost per genome. Or when it might be commercially available. “It’s all quite sensitive” at the moment, Sanghera says.

Still, these guys display plenty of confidence in what Oxford Nanopore has, and make it sound like it will be here sooner rather than later. When I asked Sanghera about how the new technique stacks up in light of Illumina’s recent announcement of the $10,000 genome, he called that a “nice incremental advance of their existing technology.” When I asked about Helicos, he said that company’s technology eliminates the need for PCR amplification of biological samples, but that it “only gets half way there” toward the goal of fast, cheap, accurate sequencing because it still requires fluorescent tags and sophisticated optical equipment.

The Oxford technology spun out of the University of Oxford in 2005, from the chemistry lab of professor Hagan Bayley. The concept of molecular sensing through nanopores represents two decades worth of research with collaborators at Harvard University, MIT, the University of Massachusetts, UC Santa Cruz, and Texas A&M University, the company says.

The newest round of cash will go toward continuing development of the Oxford Nanopore DNA sequencing tool, as well as starting early work on a protein analysis tool that’s built on the same technology platform, Sanghera says. Since proteins carry out the instructions from genes, and perform all the vital functions in the body, this is the next logical step for Oxford Nanopore, he says. Biologists now use mass spectrometer machines to identify specific proteins in a sample, but those tools suffer from laborious sample prep, subjective analysis, and high cost, he says.

The protein analysis tool is still in early development, but it should catch up quickly to the DNA sequencer, because the company can take advantage of some of its existing technology to make it happen, Sanghera says.

“We think we can really simplify the workflow with proteins just like we can for sequencing, and create a low capital cost instrument that allows direct reading of proteins,” Sanghera says.

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