Originally Published IVD Technology September 2001
Molecular diagnostics: the next business frontier?
Recent announcements by several companies suggest that the field of molecular diagnostics may finally be ready to get its due as a legitimate business trend of the future. Notably, the news comes not from start-up companies, but from established industry players that have now formed business units to focus entirely on molecular technologies.
One of the new business units is Celera Diagnostics (Alameda, CA). Applied Biosystems (Foster City, CA) and Celera Genomics (Rockville, MD), the two operating groups of Applera Corp. (Norwalk, CT), established Celera Diagnostics as a joint venture in April. To create the new venture, Applied Biosystems contributed its existing molecular diagnostic business, while Celera Genomics is providing access to its genome databases. The new company will focus on the discovery, development, and commercialization of diagnostic tests.
An immediate focus for Celera Diagnostics will be participation with Celera Genomics and Applied Biosystems in a comprehensive single nucleotide polymorphisms discovery and gene-association project to identify variations in the sequence and expression of genes and their association with disease and therapy. Discoveries of the project are expected to generate intellectual property for Applera and be incorporated into new molecular diagnostic tests.
Company officials say that Celera Diagnostics' role in the discovery project will be to establish an industrial-scale facility for high-volume genotyping and gene-expression studies, using sequence- detection systems by Applied Biosystems. The facility will be utilized for large-scale disease-association studies that will ultimately be aimed at identifying new diagnostic markers. It should also support Celera's therapeutic target discovery program.
Celera Diagnostics also plans to discover, validate, and prepare protein markers discovered in collaboration with Celera Genomics for commercialization as diagnostic immunochemistry tests.
In addition, company officials say that Celera Diagnostics will focus on the commercialization of molecular diagnostic tests on the Applied Biosystems sequencing platforms. One of these tests, the ViroSeq HIV genotyping system, has been developed to assist clinicians in assessing HIV drug resistance. At the end of July, the company submitted a premarket notification (510 (k)), seeking FDA clearance of the system as an IVD.
Also announcing a big move in molecular diagnostics is Ortho-Clinical Diagnostics (OCD; Raritan, NJ), which is participating in the creation of a new division called Advanced Diagnostic Systems. The division is expected to focus on developing cellular and molecular diagnostics. According to a press statement made by OCD president Cathy Burzik at the annual meeting of the American Association for Clinical Chemistry in July, the new division's mission is "to become involved in the cancer IVD business by providing cellular and molecular products that will impact medical decisions and patient outcomes." OCD officials declined to provide further details about the new division.
Industry analysts believe that the key to success in the molecular diagnostics market is the ability to discover new diagnostic markers.
"Big companies are looking for ways to leverage their existing infrastructure with the new molecular technologies," says Richard Schifreen, business unit leader of the molecular diagnostics division at Promega Corp. (Madison, WI). "Such bigger companies have the wherewithal to establish a division on their own and also acquire other companies or technologies to give the division some content. Smaller companies that don't have such an infrastructure have no choice but to acquire technology and content."
Making headway in the molecular diagnostics field will require not only significant financial investment, but also time and patience. "It will take deep pockets," says Schifreen. "We may be looking at 10 years before companies will begin to show a profit. So companies will need to have a willingness to take risks in the beginning and a long-term horizon if they are to be successful when the market begins to mature.
"This is the field where you're going to see the big breakthroughs in the future," adds Schifreen. "Pharmacogenomics is an area that's exciting right now. There's a lot of activity in that area for both drug discovery and clinical testing. So there is lots of growth potential in the molecular field, but commercial success is still several years away."—Richard Park
Copyright ©2001 IVD Technology
