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Life Technologies Corporation Message Board

  • carolyn_novice carolyn_novice Feb 21, 2013 3:51 PM Flag

    Sell before index Selling LIFE @ 57.65x

    Market coming back doesn’t mean stock of LIFE will come back. It has a big run up for this tear.

    Learn from AAPL and Gold when it runs out of favor.

    Sincerely,

    Carolyn Novice

    Sentiment: Sell

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    • Life's Ion Torrent Edges Illumina in Sales Battle of Benchtop Sequencers, Says Macquarie Report
      February 18, 2013 | By Bio-IT World Staff

      Sales of the Ion Torrent desktop sequencers exceed those of its rival MiSeq machine from Illumina, according to a new financial report, which highlights encouraging trends for both Illumina and Ion Torrent parent company, Life Technologies.

      In the DNA Sequencing report issued late last week from Macquarie Equities Research, analysts Jon Groberg and Travis Steed write that Illumina has made “great strides” with the MiSeq instrument, but “Life’s position in the desktop category remains under appreciated.”

      According to Macquarie, Ion Torrent has about 62% of the emerging desktop sequencing market, with 54% the PGM, 8% the Ion Proton, which launched last year. The MiSeq currently has about 38% market share.

      The report says Illumina has placed about 1,100 MiSeqs so far – about 200-250 per quarter throughout 2012 -- compared to around 1,600 Ion Torrent PGMs. (The surplus is attributed to the earlier launch of the PGM.) Sales of the MiSeq equaled or exceeded PGM placements each quarter in 2012, says the report. Life Technologies also sold about 230 Ion Proton instruments last year.

      Macquarie estimates Ion captured about 53% of desktop revenues (PGM 36%) last year, the MiSeq 47%. Consumable revenues are fairly even on the PGM and MiSeq, with users typically spending about $45-50,000 per instrument.

      Anecdotal feedback on instrument accuracy and ease of use “continues to favor MiSeq,” the report states, but Ion’s competitiveness is due to the platform’s “relatively low acquisition and per-run costs, performance trajectory and run time, ability to be ‘good enough’ for key applications, and Life’s commercial reach.”

      The report notes Illumina’s recent decisions to boost its sales force by 25% and offer a 15% MiSeq discount (through the end of March 2013). “These moves are in-line with what we determined were [Illumina’s] three primary options, should it want to catch up to Ion: 1) Cut the price of its box; 2) Expand its sales efforts; 3) Do nothing and hope that Ion Torrent’s technology falters while MiSeq keeps improving.”

      The booming desktop market appears to have sufficient headroom for both companies. “We estimate that the personal sequencing market is already annualizing at close to $400M, making our $600M base case estimate appear increasingly conservative,” the report states.

      Two Sides

      “While both platforms have their issues, consensus remains that MiSeq is more accurate than Ion,” the report goes on. The MiSeq’s major problem is with substitution errors, “but these are perceived to be more manageable than insertion/deletion errors… where Ion Torrent, despite its progress, continues to get lower marks.”

      On the ease-of-use front, “Ion’s emulsion PCR sample prep process continues to be a stumbling block to more widespread adoption,” the report says, whereas Illumina’s “hands-off amplification solution gets high marks.” But sample prep “remains an issue for both platforms” with workflow improvements promised for both.

      That said, the Macquarie report says there are still some “key reasons why Ion still wins”:

      “Selling to dispersed, small labs is proving to be quite different than selling to concentrated genome centers, large academic core labs, or commercial service providers. Being able to reach each smaller lab and provide what these customers really care about is the key to winning in the market… Smaller lab operators each want a product with a different feature set and capabilities than the other. We think that not only being able to provide these customers with a flexible product that helps them to get their jobs done but also being able to service them is key.”

      The Macquarie analysts make some telling points in noting the priorities of clinical sequencing users: “First, it is the cost per sample (and not the cost per base) that actually matters. Second, simplified workflows are very important… (the need to reduce the "pain" associated with performing the test).”

      And third: “Patients rarely come to physicians’ offices in batches of 384.”

      One other interesting side note from the Macquarie report: a German gene diagnostics law says investigations should be limited to the set of genes that address a specific medical question. “So whole genome sequencing [is] not likely [in Germany] for some time.”

      Finally, although Ion Torrent currently leads in terms of units sold, other sources report a different trend when it comes to usage. A recent NGS survey of more than 700 scientists by Danish software company CLCbio reported Illumina’s HiSeq as the most popular platform, followed by Roche/454 and Life Technologies.

 
LIFE
76.04-0.03(-0.04%)Feb 3 3:59 PMEST

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