This article has been updated from a previous version to include financial details about Qiagen's acquisition of Formulatrix's digital PCR assets.
NEW YORK (GenomeWeb) – Qiagen yesterday announced several new product initiatives and acquisitions to coincide with the first day of the JP Morgan Healthcare Conference, as it continues to stake its claim as one of the most diversified life science research tools and molecular diagnostics companies.
In short, Qiagen said it plans to develop a digital PCR system based on technology that it is acquiring from Formulatrix, and to develop a handheld, battery-operated device to facilitate use of its QuantiFeron-TB Gold Plus assay for latent tuberculosis infections in resource-poor areas of the world.
It also disclosed that it has acquired N-of-One in a bid to bolster its bioinformatics portfolio with complementary molecular oncology decision support software; and said that it launched QiaCube Connect, a next-generation version of its laboratory automation product for molecular sample processing.
Qiagen CEO Peer Schatz discussed these items in more detail in a webcast presentation at the JPM Healthcare Conference.
Qiagen has long been a frontrunner in the real-time PCR market, but digital PCR is one area that it had not yet tackled. That will change with its recent acquisition of digital PCR assets from Formulatrix, a Boston-area company that has been developing a low-cost plate-based digital PCR system called Constellation that it was positioning as a compromise between pricier droplet-based digital PCR systems and traditional plate-based real-time PCR platforms.
Terms of the deal call for Qiagen to acquire all assets related to Formulatrix's digital PCR program for $125 million in cash (to be paid from existing cash reserves) and to make future milestone payments of up to approximately $135 million. The transaction is expected to be completed by mid-2019 pending US and other regulatory approvals, and Qiagen aims to launch a product based on the technology in 2020.
Schatz said that Qiagen has been monitoring the digital PCR market for the last few years, calling it "one of the most attractive growth segments in the life sciences." He said that although it is still a small market in size (about $150 million to $250 million), it is clearly growing, and now represents about 10 percent of the overall approximately $2 billion real-time PCR market.
Qiagen began working with Formulatrix in the past couple of years, and Schatz said that the microtiter-plate format fit perfectly into Qiagen's existing PCR product portfolio, "allowing a much better integration into sample-to-insight workflows that Qiagen has demonstrated in other areas, as well."
He noted that Qiagen expects the new product to reduce digital PCR workflows to about 90 minutes from the 300 minutes typical of existing platforms (especially droplet-based ones); to enable five-plex experiments rather than the typical two-plex assays; and to ease scalability through the availability of one-, four-, and eight-plate options.
Although the product will initially be intended for research use only, the digital PCR market is slowly transitioning to molecular diagnostic applications, and Qiagen will likely eventually follow suit, Schatz said.
Another product-development effort underway at Qiagen is for a handheld reader for its QuantiFeron-TB Gold Plus assay for latent TB detection.
Qiagen is developing the reader in partnership with Ellume, a Brisbane, Australia-based developer of digital devices for diagnostics. Ellume is receiving an AUS$21 million ($15 million) investment from Qiagen as part of the agreement.
"This is a product that the market has been waiting for for quite some time," Schatz said, noting that some 85 percent of TB cases occur in low-resource settings.
"This is only … 20 percent of the market, but extremely important," Schatz noted. "In particular, to participate in national screening programs companies have to provide comprehensive solutions that not only address the testing needs in central laboratories ... but also in low-resource settings, because obviously people move between low-resource settings and cities, and therefore bring diseases to the high-resource settings." It is well-documented that much of the difficulty in managing TB in all settings lies in controlling the latent TB problem in low-resource settings.
"Therefore the ability now to take the market-leading QuantiFeron technology, and put it into a format that allows [use in] low-resource settings, with a simple battery-operated device ... and a cartridge-based [sample] carrier, is a real breakthrough," Schatz said.
The company noted that QFT Access tests can be completed in a single patient visit and in about 24 hours, unlike the decades-old skin test that requires two visits and a physician for assessment. The blood sample will be available for retesting, as needed, and data can be stored for later referral. The single-tube test is incubated for 16 to 24 hours, and results are determined in five to 20 minutes on the single-use cartridge. The results will then be displayed in real time on a compact hub, which can be operated using battery or USB power sources and independently of a computer, Qiagen said.
Qiagen is in the final stages of development for the product and expects a 2020 launch. "We believe it will have highly synergistic impacts on our ability to create national and large regional screening programs that address the centralized ... and decentralized low-resource settings to create a comprehensive offering to address the TB issue," Schatz said.
Sample prep, informatics
Qiagen also reinforced its laboratory automation and bioinformatics businesses with the launch of a next-generation version of QiaCube and the acquisition of N-of-One, respectively.
QiaCube Connect is the next generation of Qiagen's existing QiaCube system, which already boasts about 8,000 laboratory placements worldwide, Schatz said.
The new platform will be easier to use and provide greater efficiency than the current version, allowing laboratories to automate the first steps of molecular research workflows using Qiagen's spin column technologies for DNA, RNA, and protein sample processing. Specifically, the system automates the lysis, binding, washing, and elution steps.
Importantly, the new system will have new digitization capabilities and full connectivity via a tablet. It will be usable with more than 80 existing Qiagen kits and 3,000 protocols.
Early versions of the new system have been "very well perceived by customers who have already been exposed to this and we're looking forward to providing this to customers in the first quarter," Schatz said.
Meanwhile, Qiagen's acquisition of N-of-One for an undisclosed amount is intended to add "a lot of real-world evidence to our literature-based interpretation, and is complementary to our more software- and automated-knowledgebase approach" because it adds a "service layer," Schatz said.
"With $70 million in sales in bioinformatics, we're hands down number one in this space," he said, noting that the company saw "dramatic uptake" of its Qiagen Clinical Insight decision support software in 2018. However, N-of-One will allow Qiagen to reach new customer classes such as healthcare providers, pharma, and payors, he noted.
"We have several thousand users now in this space, and even though it is not a big transaction, N-of-One gives us a really strong position squarely in the real-world evidence space [and] hotwires our knowledgebases into [real-world evidence]," Schatz said. "So what you saw with Flatiron [Health] and a few other transactions in this space, we can now replicate with this connection of the case base that we have through N-of-One, the services that we have there, and our literature-based knowledgebases."
(Roche acquired Flatiron Health earlier this year for approximately $1.9 billion in a bid to add real-world evidence to its oncology drug-development efforts.)
"It's not the testing technologies, it's the informatics that will create the differentiation in the long run," Schatz said.