The Solexa Acquisition and Anti-Takeover
A few folks objected to my recent post on the other stack.
In that post I moaned (needlessly and in a thinly veiled attempt to gain subscribers) about the following statement:
“Illumina invented a profound new measurement technology”
My claim was that Illumina didn’t invent anything (profound and new), they bought it.
The objections mostly feel like a misunderstanding… as my intension was not to say Illumina haven’t contributed anything to the development of the next-gen sequencing. Just that the basic approach came from Solexa and the core of that approach remains.
What Did Solexa Contribute?
There are 3 main components1 to the Solexa approach:
Bridge amplification came from Manteia Predictive Medicine and honestly, was probably a fundamental contribution which is all too often overlooked. So I should be clear, I’m not saying Solexa invented everything either… just that Illumina didn't.
Solexa was originally a single molecule sequencing company. Their first instrument (the Genome Analyzer) was designed as a prism-style TIRF platform which I imagine could have supported single molecule imaging.
It wasn’t a great instrument by any stretch of the imagination. More or less a lab rig thrown in a box. But it shipped. And post-Illumina acquisition it shipped largely unchanged in reasonably large numbers.
When I was at Sanger, we had ~20 of them. Other large genome centers also started buying them in large numbers. It kind of became clear that if you didn’t you’d be left behind.
There was nothing else on the market that was competitive. None of SOLiD, 454, Ion Torrent, Helicos, Complete Genomics or PacBio2 had the necessary throughput or data quality.
Illumina Executed Well
Post acquisition Illumina made a number of strong contributions to the Solexa approach with the development of the HiSeq and subsequent instruments. These include:
TDI Imaging (scanning across the surface using a linear-ish sensor).
Patterned Flowcells and Ex-amp.
These have all been important in enabling cost reduction, throughput increases3 and improved data quality.
They don’t in my view alter the basic measurement approach.
Illumina Without Solexa
Where would Illumina be if they hadn’t acquired Solexa?
Illumina was only just turning a profit4 at the time of the Solexa acquisition.
Assuming Illumina had remained interested in NGS who else could have they acquired? 454? Ion Torrent? Perhaps they would have acquired Helicos and developed an alternative surface amplification approach?
Thing is… Illumina have been pretty terrible about releasing fundamentally new approaches and have mostly grown through acquisition. Illumina own the MspA nanopore IP, but have failed to execute on it. So it’s not clear to me that a new sequencing technology would have been developed in house.
We’ll never know what would have happened. But I personally I doubt we’d we talking about Illumina today if they hadn’t acquired Solexa.
Solexa Without Illumina
Let’s face it British companies often fail to play well internationally. I suspect the Sanger Institute would still have bought those 20 Genome Analyzers. I suspect other Genome Centers would also have acquired instruments…
But would Solexa have released a HiSeq? Or NovaSeq?
This is less clear to me. Overall… it feels like Illumina was a good home for the Solexa technology. Illumina executed well. Other acquirers5 may not have. And Solexa might have had a hard time executing on the platform alone.
Who Cares Anyway?
I guess the question is who cares anyway? I mean this is all ancient history isn’t it?
Well… kind of.
The point is that some people are still somewhat bitter about the Solexa acquisition and wish Solexa had remained a “UK” company and believe that the $600M exit they got was too low.
Many folks from Solexa went on to Oxford Nanopore who put in place anti-takeover shares that prevent acquisition. You don’t need to take my word on the motivation:
“Medisense was an Oxford spinout that was sold to Abbott in 1996 for $876m and Solexa was sold to Illumina ten years later for $600m. The Solexa deal enabled Illumina, now worth $70bn, to become the world’s dominant sequencing company. “Myself and our CTO Clive Brown [a former Solexa employee] don’t see these as great successes. We saw this as a sad ending of what could be a globally dominant tech, and no revenues really have come back to this country,” - Gordon Sanghera quoted in the FT
Those anti-takeover shares appear to expire next year. I guess only time will tell how this plays out for Oxford Nanopore.
Not all of these platforms were out at the time of acquisition, but none of these platforms were competitive anyway…
Measured either in bases/run or per-hour.
“We have incurred net losses each year since our inception. As of January 1, 2006, our accumulated deficit was $144.6 million and we incurred a net loss of $20.9 million for the year ended January 1, 2006. We recorded a modest profit in the fourth quarter of 2005 and we may not be profitable in 2006”
Roche could well have killed it… Thermo I suspect would have released something like the MiSeq but nothing else. This is of course wild speculation. But they don’t feel like companies that would have really pushed the throughput envelope.