Strengthening its dominance in the fast-growing field of human genome sequencing, San Diego’s Illumina is buying rising competitor Pacific Biosciences for $1.2 billion.
The acquisition would give Illumina the technology to delve deeper into complex genomic questions about health and life, Illumina said in its Thursday announcement.
The move also puts Illumina in a position to continue to dominate the DNA-sequencing space, where it faces few competitors. Its technology powers DNA-testing services such as Ancestry and 23andMe, and Illumina sequencers are increasingly used to determine the genetic roots of human diseases, to understand pathogens, to probe genetics of crops and livestock, and for many other purposes.
That’s in large part because Illumina has driven down the cost of sequencing a human genome from millions of dollars to under $1,000, a milestone. Bringing down the cost enlarges the market as more applications become economically feasible.
The purchase of Menlo Park-based Pacific Biosciences gives Illumina more versatility in tackling difficult problems, said Francis deSouza, Illumina’s president and CEO, in a statement.
Pacific Biosciences can sequence longer individual molecules of DNA at a time than Illumina can, and do so with high accuracy. Illumina, however, dominates in the speed and sheer power of its short-read sequencers.
Scripps Research cardiologist-geneticist Eric Topol had fun with the short and long DNA sequence comparison when he tweeted about the deal.
“Short version: short meets long. short eats long,” Topol quipped on Twitter.
In San Diego, Illumina sequencers are at work in Rady Children’s Hospital San Diego, where their power and speed help diagnose life-threatening infant diseases. They’re found at the J. Craig Venter Institute, which works at the frontiers of life, and UC San Diego’s Institute for Genomic Medicine.
Around the world, Illumina sequencers are omnipresent in genomic research and disease diagnosis. They’re powering the sequencing of 100,000 genomes in England, expected to be complete by year’s end. China also represents a major emerging market.
Illumina’s market leadership has made it by far the most valuable publicly traded life science company in San Diego County. As of the close of trading Thursday, its market value reached nearly $46 billion. Among all public companies in San Diego, Illumina’s market cap is second only to digital wireless giant Qualcomm.
On July 30, Illumina reported second quarter revenue of $830 million, 25 percent greater than the $662 million recorded for the second quarter of 2017.
The deal still needs shareholder and regulatory approval. Those approvals are expected by the middle of next year, Illumina said. The board of both companies have already approved the deal.
The purchase is far from the biggest in San Diego County. Carlsbad’s Life Technologies was purchased for $13.6 billion in 2014 by Thermo Fisher Scientific.
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