Category: ILMN

ILMN – Illumina (ILMN) Shares Slip on GRAIL Buyout Deal Completion

Illumina, Inc. (ILMN Free Report) recently announced the completion of its long-standing and highly-disputed acquisition of GRAIL — a healthcare company focused on life-saving early detection of multiple cancer to accelerate patient access to the latter’s multi-cancer early-detection test. The latest move follows a definitive agreement signed by Illumina to acquire GRAIL in September 2020.

It is to be noted that the European Commission’s (EC) decision is still pending regarding this $7.1-billion (in cash-and-stock as explained in September 2020) colossal takeover. According to Illumina, GRAIL will continue to operate as a separate company until the ongoing regulatory review by the EC is completed.

Following the news of this acquisition, shares of Illumina stumbled 7.9% on Aug 19 to close the session at $470.36, as the company announced that it is likely to be fined for completing its acquisition of GRAIL while the EC was still reviewing the merger. Going by a Reuters’ report, breaches can lead to fines of as much as 10% of the aggregate turnover of the companies.

Legal Implications Related to Acquisition

Illumina noted that GRAIL has no business in the European Union (EU). The company believes the EC does not have jurisdiction to review the merger as the EU merger thresholds are not met, nor are they met in any EU member state. The General Court of the EU will hear Illumina’s jurisdictional challenge later in 2021. By holding GRAIL separate while proceedings are ongoing, Illumina is positioned to follow whatever final decision is reached in the legal processes.

Zacks Investment ResearchImage Source: Zacks Investment Research

Per Illumina’s management, the decision to make the acquisition and hold the companies separate allows the regulatory processes to proceed while safeguarding the life-saving, pro-competitive benefits of this transaction without the expiry of deal.

Transaction Details

As previously disclosed, Illumina’s acquisition of GRAIL included cash and shares of Illumina common stock as well as contingent value rights (CVRs) or additional shares of Illumina common stock.

GRAIL stockholders, including Illumina, are entitled to cash consideration of nearly $3.5 billion or, excluding Illumina, nearly $3.1 billion.

How Strategic is the Acquisition?

Cancer kills around 10 million people worldwide annually and 600,000 people in the United States alone. Nearly 71% of cancer deaths have no early detection screening recommended, and most cancer are detected when chances of survival are lower. As the early detection of cancer saves lives, the new genomic test will be nothing short of a revolution for human health and the economics of healthcare.

Moreover, combining the two companies is the quickest way to expand the availability and affordability of the test. As Illumina entered the non-invasive prenatal testing space, prices dropped, reimbursement expanded, the number of providers increased, and more expectant parents gained access to testing.

GRAIL’s Galleri blood test detects 50 different types of cancer before they are symptomatic. Currently, this groundbreaking test is available in the market but costs as high as $950 because it is not covered by insurance companies. According to Illumina, with the acquisition, the company’s expertise in market development and access will lead to coverage and reimbursement for this test. This will accelerate access and adoption of this life-saving test worldwide.

Industry Prospects

Per a report by RESEARCH AND MARKETS, the global cancer testing market or cancer screening market size is estimated reach a worth of $123-$133 billion as of 2018 and is expected to see a CAGR of 4.5-5.5% by 2025.

Considering the market opportunities, Illumina’s latest acquisition to accelerate patient access to the GRAIL’s multi-cancer early-detection test is well-thought of.

Recent Developments

In April 2021, Illumina entered into a new partnership with Kartos Therapeutics to co-develop a TP53 companion diagnostic based on the content of Illumina’s comprehensive genomic profiling assay — TruSight Oncology 500 (TSO 500). The partnership with Kartos builds on a solid history and varied portfolio of Illumina’s oncology partnerships with industry leaders, with the integrated goal of advancing cancer diagnostics and precision medicine.

In February 2021, Illumina entered into an agreement with the Belgian Society of Medical Oncology (BSMO) which is running a new national pilot to assess the use of comprehensive genomic profiling (CGP) in 864 patients with advanced metastatic cancer.

Price Performance

Shares of the company have gained 39.5% in a year’s time against the industry’s fall of 0.3%.

Zacks Rank and Key Picks

Currently, the company carries a Zacks Rank #3 (Hold).

A few better-ranked stocks from the broader medical space are Envista Holdings Corporation (NVST Free Report) , BellRing Brands, Inc. (BRBR Free Report) and Henry Schein, Inc. (HSIC Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of Zacks #1 Rank (Strong Buy) stocks here.

Envista Holdings has an estimated long-term earnings growth rate of 26%.

BellRing Brands has an estimated long-term earnings growth rate of 22%.

Henry Schein has a projected long-term earnings growth rate of 14%.

ILMN – Illumina in EU antitrust sights over premature $8 billion Grail deal

BRUSSELS, Aug 20 (Reuters) – U.S. life sciences company Illumina (ILMN.O) could face a hefty fine for jumping the gun by completing its $8 billion cash-and-stock takeover of cancer detection test maker Grail (GRAL.O) without first securing EU antitrust approval.

Illumina closed the Grail takeover on Wednesday and said it would hold the company separate while waiting for the European Commission to decide whether to clear or block the deal. read more

But the EU executive said on Friday it would investigate if Illumina has breached its standstill obligation, which requires companies to secure EU antitrust approval before closing any merger deals.

“We deeply regret Illumina’s decision to complete its acquisition of Grail while our investigation into the transaction is still ongoing,” Commission Vice President Margrethe Vestager said in a statement.

“This obligation, that we call standstill obligation, is at the heart of our merger control system and we take its possible breaches very seriously,” Vestager said.

Illumina did not immediately respond to a request for comment.

Violations can lead to fines of as much as 10% of the aggregate turnover of the companies. French telecoms group Altice for instance was hit with a 125 million euro ($146 million) fine three years ago for closing its 2015 takeover of PT Portugal before gaining regulatory approval.

EU antitrust regulators had warned on July 22 that Illumina’s bid could curb innovation and competition as they opened a full-scale investigation into the matter. read more

Illumina’s decision to close the Grail deal came ahead of an Aug. 24 trial by the U.S. Federal Trade Commission, which has also voiced concerns about the impact of the deal.

Grail makes a non-invasive, early detection biopsy test to screen for many kinds of cancers using DNA sequencing.

Reporting by Foo Yun Chee; Editing by David Holmes

Our Standards: The Thomson Reuters Trust Principles.

ILMN – Illumina closes $7.1 billion deal for cancer test maker Grail amid regulatory hurdles

FILE PHOTO: The offices of gene sequencing company Illumina Inc are shown in San Diego, California January 11, 2016. REUTERS/Mike Blake

(Reuters) – Illumina Inc has completed its $7.1 billion acquisition of cancer detection test maker Grail Inc, it said on Wednesday amid challenges posed by the U.S. Federal Trade Commission and the European Union antitrust regulators.

The life sciences company said there is no legal impediment to the closure in the United States and that the move will ensure the deal does not expire before the regulatory processes conclude.

The U.S. antitrust regulator did not immediately respond to Reuters request for comment.

The cash-and-stock deal was announced in September last year by Illumina to gain access to Grail’s flagship Galleri blood test used to diagnose cancers at early stages when the disease is easier to treat.

The deal will face a trial bit.ly/3z1pbHV on Aug. 24 at the FTC, which had in March filed a complaint seeking to block the deal, arguing that Illumina is the sole provider of the DNA sequencing that Grail uses and could prevent others from entering the market.

EU antitrust regulators in July opened a full-scale investigation after warning that the deal could curb innovation and competition.

The company said on Wednesday it would hold Grail as a separate company during the European Commission’s ongoing regulatory review.

“We will abide by any outcome ultimately reached by the courts,” Charles Dadswell, general counsel of Illumina, said.

Reporting by Manojna Maddipatla in Bengaluru; Editing by Arun Koyyur

ILMN – Illumina Acquires GRAIL to Accelerate Patient Access to Life-Saving Multi-Cancer Early-Detection Test

Illumina, the global leader in DNA sequencing, first announced its intention to acquire GRAIL nearly a year ago, reuniting Illumina with GRAIL four years after it was spun off. GRAIL’s Galleri blood test detects 50 different cancers before they are symptomatic. Illumina’s acquisition of GRAIL will accelerate access and adoption of this life-saving test worldwide.  

Regulators in the EU are reviewing the transaction, but a decision is projected after the deal expires. GRAIL has no business in the EU, and the company believes that the European Commission does not have jurisdiction to review the merger as the EU merger thresholds are not met, nor are they met in any EU member state. The General Court of the European Union will hear Illumina’s jurisdictional challenge later this year. By holding GRAIL separate while proceedings are ongoing, Illumina is positioned to abide by whatever final decision is reached in these legal processes. 

There is no legal impediment to acquiring GRAIL in the US. Illumina is committed to working through the ongoing FTC administrative process, and as always, will abide by whatever outcome is ultimately reached in the US courts.  

The reasons to reunite the two companies are compelling: 

  • The deal will save lives. Cancer kills around 10 million people annually worldwide and 600,000 people in the US alone. Cancers responsible for nearly 71% of cancer deaths have no recommended early detection screening, and most cancers are detected when chances of survival are lower. Illumina feels there is a moral obligation to have the deal decided by a thoughtful and full review by the EU regulators and the US courts. This can only be done if Illumina acquires GRAIL now. Otherwise, the company is locked into a situation where the deal terms will expire before there is a chance for full review; the clock will just run out.
  • Right now, the Galleri test is available but costs $950 because it is not covered by insurance. Reuniting the two companies is the fastest way to make the test broadly available and affordable. Illumina’s expertise in market development and access has resulted in coverage of genomic testing for over 1 billion people around the world already. This experience will help lead to coverage and reimbursement for the Galleri test.
  • GRAIL and Illumina have a long history. Illumina formed GRAIL and spun it out in 2016. GRAIL’s first employees were part of Illumina, which still owns 12 percent of the company. GRAIL and Illumina are not competitors—this is a vertical acquisition.
  • Based on past experience, when Illumina enters a market, the market expands. When Illumina entered the non-invasive prenatal testing space, prices dropped, reimbursement expanded, the number of providers increased, and more expectant parents had access to testing.
  • Illumina’s acquisition of GRAIL is driven by the belief that this test should be available to as many people as possible as quickly as possible. From fighting the COVID-19 pandemic to matching cancer patients to therapies, Illumina’s mandate is to save lives and transform healthcare. The first COVID-19 viral sequence was on an Illumina machine and now genomic surveillance has emerged as a critical tool in the global fight against the pandemic, with over 70 countries now using Illumina platforms for COVID-19 variant tracking.

“Just as we are now able to screen for early-stage diabetes and high cholesterol, we will soon be able to conduct multi-cancer early detection with a simple blood test in your doctor’s office,” said Francis deSouza, Chief Executive Officer of Illumina.  “Since early detection of cancer saves lives, this new genomic test will be nothing short of transformational for human health and the economics of healthcare.”

“The merger with Illumina will get the Galleri test to people far faster. We aim to accelerate this process so the test will be available in doctors’ offices everywhere, fully reimbursed,” said Hans Bishop, Chief Executive Officer of GRAIL. “A one-year acceleration of access to the Galleri test for the US population has the potential to save 10,000 lives over a 9-year period.”

“The decision to make the acquisition and hold the companies separate permits the regulatory processes to proceed while safeguarding the life-saving, pro-competitive benefits of this vertical transaction without the deal expiring. We will abide by any outcome ultimately reached by the courts,” said Charles Dadswell, General Counsel of Illumina.

About Illumina

Illumina is improving human health by unlocking the power of the genome. Our focus on innovation has established us as the global leader in DNA sequencing and array-based technologies, serving customers in the research, clinical and applied markets. Our products are used for applications in the life sciences, oncology, reproductive health, agriculture, and other emerging segments. To learn more, visit www.illumina.com and connect with us on Twitter, Facebook, LinkedIn, Instagram, and YouTube.

Investors:
Brian Blanchett
858.291.6421
[email protected]

Media:
Dr. Karen Birmingham
646.355.2111
[email protected]

Transaction Details

As previously disclosed, the merger consideration for Illumina’s acquisition of GRAIL included cash and shares of Illumina common stock, as well as contingent value rights (CVRs) or additional shares of Illumina common stock.

GRAIL stockholders, including Illumina, are entitled to cash consideration of approximately $3.5 billion or, excluding Illumina, approximately $3.1 billion.  We are also spending approximately $0.4 billion in cash to cover the tax withholding requirements from net settling shares of Illumina common stock issuable to GRAIL employees.

The base stock consideration was subject to a collar, where the number of shares issued at closing varied in the event the 20-trading-day volume weighted average price of Illumina stock as of 10 trading days prior to closing is between $295 and $399 but was fixed at 11.3 million shares if such volume weighted average share price is above $399, which is where the stock has traded over the last couple months. 

In addition to the cash consideration and the base stock consideration, GRAIL stockholders were entitled, at their election, to receive CVRs or additional shares of Illumina common stock. The CVRs entitle holders to receive future payments representing a pro rata portion of certain GRAIL-related revenues each year for a 12-year period starting at close.  This will reflect a 2.5% payment right to the first $1 billion of revenue each year for 12 years.  Revenue above $1 billion each year will be subject to a 9% contingent payment right during this same period. Holders of approximately 47% of GRAIL equity interests and/or awards (on a fully diluted basis), or 54% excluding Illumina, elected to receive the CVR consideration.

The alternative additional stock consideration (that GRAIL stockholders could elect to receive in lieu of CVRs) consisted of up to $850 million of shares of Illumina common stock, with the number of shares issued capped at a specified amount if the 20-trading-day volume weighted average price of Illumina stock as of 10 trading days prior to closing is less than $280, which did not occur. In total, we will be issuing approximately 9.8 million shares of Illumina common stock as part of this acquisition. The number of shares issued reflects approximately 11.3 million shares of base stock consideration and approximately 0.7 million shares of additional stock consideration (in lieu of CVRs), reduced by approximately 1.4 million shares to which Illumina is entitled in respect of its GRAIL stock and approximately 0.8 million shares in respect of GRAIL employee net share settlement.

Conference Call Information

Illumina will host a conference call to discuss the transaction today, August 18, 2021 at 5:30 p.m. ET.  Interested parties may access the live teleconference through the Investor Relations section of Illumina’s web site under the “company” tab at www.illumina.com. Alternatively, individuals can access the call by dialing the Toll-Free Dial-In Number: (866) 211-4597, or the International Dial-In Number: (647) 689-6853 outside North America, both with Conference ID: 9955888.  Following the call, a replay will be posted on Illumina website and will be available for at least 30 days following posting.

Cautionary Notes on Forward-Looking Statements

This communication contains “forward-looking statements” within the meaning of the federal securities laws, including Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In this context, forward-looking statements often address expected future business and financial performance and financial condition, and often contain words such as “expect,” “anticipate,” “intend,” “plan,” “believe,” “seek,” “see,” “will,” “would,” “may,” “target,” similar expressions and variations or negatives of these words. Forward-looking statements by their nature address matters that are, to different degrees, uncertain, such as statements about the effects of the consummation of the transaction and the anticipated benefits thereof. These and other forward-looking statements are not guarantees of future results and are subject to risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed in any forward-looking statements. Important risk factors that may cause such a difference include, but are not limited to: (i) the possibility of fines, penalties, remedies or restrictions sought or imposed by governmental or regulatory authorities as a result of consummating the transaction, (ii) the possibility of other adverse consequences to, among other things, Illumina’s reputation, its relationships with governmental or regulatory authorities or its ability to successfully complete future acquisitions and/or divestitures as a result of consummating the transaction, (iii) the potential impact of unforeseen liabilities, future capital expenditures, revenues, costs, expenses, earnings, synergies, economic performance, indebtedness, financial condition and losses on the future prospects, business and management strategies for the management, expansion and growth of Illumina’s business after the consummation of the transaction, (iv) potential adverse reactions or changes to business relationships resulting from the completion of the transaction, (v) any negative effects of the consummation of the transaction on the market price of Illumina’s common stock and on Illumina’s operating results, (vi) risks associated with third-party contracts containing consent and/or other provisions that have been triggered by the consummation of the transaction, (vii) the risks and costs associated with the integration of, and the ability of Illumina to integrate, GRAIL, Inc.’s (“GRAIL”) business successfully and to achieve anticipated synergies, including any delay in integration following any hold separate period, (viii) the risks and costs associated with the development and commercialization of, and Illumina’s ability to develop and commercialize, GRAIL’s products, including Galleri, the cancer screening test developed by GRAIL; (ix) Illumina’s ability to obtain regulatory clearance for its products from government agencies; (x) Illumina’s ability to obtain approval by third-party payors to reimburse patients for its products; (xi) the risk that disruptions from the consummation of the transaction or any associated legal or regulatory proceedings or obligations will harm Illumina’s business, including current plans and operations, (xii) legislative, regulatory and economic developments, (xiii) the other risks described in the Consent Solicitation Statement of GRAIL, Inc. and Prospectus of Illumina, Inc. (the “Consent Solicitation Statement/Prospectus”) that is included in the registration statement on Form S-4 (File No. 333-250941) filed by Illumina with the Securities and Exchange Commission (the “SEC”) (as amended, the “Registration Statement”), as well as in Illumina’s most recent annual reports on Form 10-K and quarterly reports on Form 10-Q and in the registration statement on Form S-1 filed with the SEC by GRAIL on September 9, 2020, as amended on September 17, 2020, and (xiv) management’s response to any of the aforementioned factors.

These risks, as well as other risks associated with the transaction, are more fully discussed in the Consent Solicitation Statement/Prospectus that is included in the Registration Statement. While the list of factors presented here is, and the list of factors presented in the Registration Statement are, considered representative, no such list should be considered to be a complete statement of all potential risks and uncertainties. Unlisted factors may present significant additional obstacles to the realization of forward-looking statements. Consequences of material differences in results as compared with those anticipated in the forward-looking statements could include, among other things, business disruption, operational problems, financial loss, legal liability to third parties and similar risks, any of which could have a material adverse effect on Illumina’s financial condition, results of operations, credit rating or liquidity. Illumina does not assume any obligation to publicly provide revisions or updates to any forward-looking statements, whether as a result of new information, future developments or otherwise, should circumstances change, except as otherwise required by securities and other applicable laws.

Exhibit A Net Consideration (unaudited)



Shares (in millions)

Cash (in billions)




All GRAIL Shareholders

11.3

$3.5

(-) Illumina Holdings (a)

(1.4)

(0.4)

GRAIL Shareholders (excluding Illumina)

9.9

3.1

(+) Additional Stock (in lieu of CVRs) (b)

0.7

(+) Employee Share Net Settlement (c)

(0.8)

0.4

Net Consideration (excluding Illumina) (d)

9.8

$3.5






(a)

Illumina owned 12.0% of the outstanding equity interests in GRAIL on a fully diluted basis.

(b)

GRAIL stockholders were entitled, at their election, to receive contingent value rights (CVRs) or additional shares of Illumina common stock. Holders of approximately 46% of GRAIL total equity interests and/or awards (on a fully diluted basis; excluding Illumina) elected to receive additional shares of Illumina common stock.

(c)

In accordance with the Amendment to the Agreement and Plan of Merger, dated as of February 4, 2021, the withholding tax obligation for the stock received by current and former GRAIL employees in respect of their equity awards was satisfied on a “net settlement” basis. As a result, the total number of shares issued was reduced by a number of shares with a value equal to such withholding obligation, and an equivalent cash amount was paid by Illumina in respect of such withholding obligations.

 (d)

Excludes potential future consideration for the approximately 54% of GRAIL stockholders (on a fully diluted basis; excluding Illumina) that elected to receive the CVRs.  The CVRs entitle holders to receive future payments representing a pro rata portion of certain GRAIL-related revenues each year for a 12-year period starting at close.  This will reflect a 2.5% payment right to the first $1 billion of revenue each year for 12 years.  Revenue above $1 billion each year will be subject to a 9% contingent payment right during this same period.

SOURCE Illumina, Inc.

Related Links

www.illumina.com

ILMN – Illumina-Grail $8B Merger Hit By European Commission's In-Depth Investigation

Illumina-Grail $8B Merger Hit By European Commission's In-Depth Investigation

  • The European Commission has opened an in-depth, three-month investigation into Illumina Inc’s (NASDAQ: ILMN) planned takeover of Grail, a deal valued between $7 billion to $8 billion.
  • Last week, the EU announced that it was preparing to launch a full-scale probe into a pending merger.
  • On Thursday, Illumina said it is committed to re-acquire Grail.
  • European officials are probing the deal because of concerns it “may reduce competition and innovation in the emerging market for the development and commercialization of cancer detection tests based on sequencing technologies.” 
  • The U.S. Federal Trade Commission in March moved to block Illumina’s takeover of Grail on similar grounds. But FTC subsequently put on hold potential actions, as it takes a wait-and-see approach to the regulatory outcome in Europe.
  • The commission has until November 29 to decide whether the deal would stifle competition in the field of early cancer detection. 
  • That timeline could be a problem for Illumina, as the company’s lawyers have previously stated that the deal will expire by September 20 unless extended.
  • Price Action: ILMN shares are up 1.47% at $493.67 during the market session on the last check Friday.

ILMN – Has Illumina Lost Its Shine?

In 2016, Cathie Wood and ARK investment management described Illumina (NASDAQ:ILMN) as “the cornerstone of our Genomic Revolution theme, and one of our highest conviction stocks.” Illumina became one of the largest holdings across several ARK ETFs including the ARK Innovation ETF (NYSEMKT:ARKK) and ARK Genomic Revolution ETF (NYSEMKT:ARKG).

However, in 2020, ARK had a large change in sentiment and began selling Illumina. As of its July 2020 SEC filings, ARK held 812,714 shares valued at roughly $311 million. By the January 2021 filings, ARK had sold all its Illumina holdings. What was behind ARK’s loss of conviction in Illumina?

DNA double helix

Image source: Getty Images.

Don’t break Wright’s Law

One of the underlying themes across all ARK investments is Wright’s Law and its impact on disruptive innovation. Wright’s Law states that for every cumulative doubling of units produced, costs will fall by a constant percentage. As costs decline, affordability increases to the point where demand grows exponentially.

In the case of genomics technology, doubling the number of genes sequenced has historically led to 40% annual declines in cost. In 2000, the cost to sequence a genome was roughly $100 million. By 2015, the cost had dropped to $1,000 per genome. Since then the cost reductions seem to have stalled out. That’s a big problem for the ARK investment thesis — no cost reduction, no exponential growth, no genomic revolution. 

Some industry observers blamed the slowing cost reductions on Illumina’s inability to introduce the next generation of sequencing technology. This view was reflected in Illumina’s financial results which hit a speed bump in 2019 and continued to struggle through the first half of 2020. 

Competition is heating up

To make matters worse for Illumina, other competitors using different sequencing approaches began to catch up. Just last week, Pacific Biosciences (NASDAQ:PACB) announced it had used its long read sequencing (LRS) technology to sequence the final 8% of the human genome that remained untouched after the initial sequencing effort almost 20 years ago.

This long-awaited technology advancement in LRS could set off a new round of scientific discovery and leapfrog Illumina — particularly if Illumina’s cost curve doesn’t resume its rapid descent. This potential negative development was not lost on Illumina, as it tried to buy Pacific Biosciences in 2018 but was rebuffed by regulators who feared the combined entity would stifle competition.

The empire strikes back

Illumina seems to be shifting gears in the face of mounting competition. To address the price point concerns, Illumina invested in new cost-lowering innovations and is shipping a new line of sequencers targeted at $600 per genome with a roadmap to achieve $100 per genome. The roadmap also calls for increased investment in artificial intelligence (AI) and support for leading edge “multi-omics,” which use advanced sequencing to create a more comprehensive understanding of the biology underlying human health and diseases.

The revitalized approach seems to be paying off. In Illumina’s Q1 conference call, CEO Francis deSouza reported orders reached an all-time high with the company also making progress in penetrating new markets and receiving reimbursement for genomic treatments. For fiscal 2021, Illumina expects year-over-year revenue growth in the range of 25% to 28% with GAAP earnings per diluted share of $4.72 to $4.97 and non-GAAP earnings per diluted share of $5.80 to $6.05.

Securing its leadership position

The renewed focus on achieving breakthrough price points and getting back on track with Wright’s Law is a promising development. To ensure this talk translates into action, investors should monitor Illumina’s progress on several fronts:

  • Meeting and exceeding price targets at less than $1,000 per genome.
  • Growing revenue 25% to 30% per year from the installation and upgrade of sequencing machines.
  • Extending global leadership with new multi-omic advancements and relationships.

By taking a contrarian position to Cathie Wood and betting on Illumina’s renewed focus, your portfolio could shine for years to come.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

ILMN – Gene-Sequencing Company With Several Illumina Execs at Top Going Public

Several executives who earned their spurs at dominant genetics sequencing company Illumina Inc. (

ILMN, Financial) hold key management positions at a firm that is planning a $100 million initial public offering.

San Diego-based Singular Genomics has former Illumina Vice President and Chief Sustainability Officer David Baker on its board, in addition to President and Chief Operating Officer Dave Daly, who is also Thrive’s former CEO, and Senior Vice President of Corporate Development Jorge Velarda.

The company was founded in 2016 by CEO Andrew Spaventa, CSO Eli Glezer and Baker. In a registration statement filed May 7, Singular said it is developing next-generation sequencing technology for cancer and immunology. The proprietary sequencing chemistry will support two different instruments: the G4, a benchtop, mid-throughput DNA sequencer, and the PX, an instrument that will use sequencing as a readout for applications in single-cell and spatial multi-omic analysis.

The company plans to trade on the Nasdaq under the ticker symbol “OMIC.”

If Singular comes even close to duplicating the success of Illumina, it will be a big win for shareholders and all involved. The latter’s stock is up 175% in the past five years to more than $386, though it has been relatively flat over the past year.

Singular is striking while the iron is hot. A total of 141 IPOs have been priced worldwide this year, more than three times for the same period in 2020, according to Renaissance Capital, an IPO investment advisory firm. Moreover, investors have demonstrated they still have a healthy appetite for early-stage health care companies.

Singular will go head-to-head with not only Illumina, but other big names in the field, including Thermo Fisher Scientific Inc. (

TMO, Financial) and Pacific Biosciences of California Inc. (PACB, Financial).

According to Fortune Business Insights, the global next-generation sequencing market size is expected to reach $31.4 billion globally in five years, accelerating at a compound annual rate of more than 22% between 2019 and 2026. Other well-known names in the market are Roche (

RHHBY, Financial), Agilent Technologies Inc. (A, Financial), Qiagen N.V. (QGEN, Financial), BGI Genomics Co. (SZSE:300676), PerkinElmer Inc. (PKI, Financial), Eurofins Scientific (ERSF, Financial) and MacroGenics Inc. (MGNX, Financial).

Singular is driving to get its first product on the market, the desktop G4 Instrument and related consumables. The G4 is expected to begin shipping in the first half of 2022 for research use focused on oncology, including rare variant detection in liquid biopsy tests, reported the San Diego Union-Tribune.

For the three months ended March 31, Singular posted a net loss of $23.9 million, or $2.05 per share, compared to a loss of $5.3 million, or 52 cents per share a year ago.

For full-year 2020, the firm lost $27.9 million, or $2.64 per share, compared to a loss of $12.3 million, or $1.43 per share, in 2019.

The weighted-average number of shares used to calculate earnings per share was approximately 11.7 million in the first quarter. As of March 31, Singular Genomics had $45.5 million in cash and cash equivalents and $104.6 million in short-term investments.

Disclosure: The author has a position in Illumina.

Not a Premium Member of GuruFocus? Sign up for a free 7-day trial here.

ILMN – CORRECTING and REPLACING Illumina Named One of Singapore's Best Employers

SINGAPORE–()–First paragraph, second sentence of release should read: Illumina was second in Health Care and Equipment Services and placed 27th on the overall list.

The updated release reads:

ILLUMINA NAMED ONE OF SINGAPORE’S BEST EMPLOYERS

Continues regional expansion with a focus on employees

Illumina, Inc., today announced, for the second consecutive year, Illumina is honored as one of Singapore’s Best Employers in a survey sponsored by The Straits Times and the marketing firm Statista. Illumina was second in Health Care and Equipment Services and placed 27th on the overall list. Conducted in late 2020, the survey queried around 9,000 people employed in all different industries, giving them the opportunity to express their support for 1,700 local companies with more than 200 employees.

“It is heartwarming to be recognized once again as one of Singapore’s Best Employers,” says Derric Lee, Vice President and General Manager of Illumina Singapore. “This award means a great deal and gives recognition for our efforts to create a conducive, inclusive and rewarding environment for employees at any level.”

The survey results are based on employee perceptions from companies in the region. Respondents were asked whether they would recommend their employer to a friend or family member, and if they would make the same recommendation for other companies.

Headquartered in San Diego, California, Illumina’s first Singapore facility opened in 2008 with ten employees and a 38,000 square foot facility. Today, Illumina Singapore has increased the number of employees to more than 1,300 and grown to three buildings, occupying ten times the original space—now totaling 385,000 square feet. The momentum continues with an additional facility for research and development which is expected to open in the first quarter of 2022.

“We plan to create a complete ecosystem for employees to develop, grow and thrive,” says Lee. “This ethos means focusing on every aspect of an employee’s time with the company from the first moment they walk in the door. We are always assessing the totality of the workplace experience, including onboarding, office ambience, maintaining an open and collaborative culture, training and development, and care and support. Our goal is to provide employees with the best possible end-to-end experience when they work for Illumina.”

About Illumina

Illumina is improving human health by unlocking the power of the genome. Our focus on innovation has established us as the global leader in DNA sequencing and array-based technologies, serving customers in the research, clinical and applied markets. Our products are used for applications in the life sciences, oncology, reproductive health, agriculture and other emerging segments. To learn more, visit www.illumina.com and connect with us on Twitter, Facebook, LinkedIn, Instagram, and YouTube

ILMN – Illumina Named One of Singapore's Best Employers

SINGAPORE–()–Illumina, Inc., today announced, for the second consecutive year, Illumina is honored as one of Singapore’s Best Employers in a survey sponsored by The Straits Times and the marketing firm Statista. Illumina was second in Health Care and Equipment Services and placed 30th on the overall list. Conducted in late 2020, the survey queried around 9,000 people employed in all different industries, giving them the opportunity to express their support for 1,700 local companies with more than 200 employees.

“It is heartwarming to be recognized once again as one of Singapore’s Best Employers,” says Derric Lee, Vice President and General Manager of Illumina Singapore. “This award means a great deal and gives recognition for our efforts to create a conducive, inclusive and rewarding environment for employees at any level.”

The survey results are based on employee perceptions from companies in the region. Respondents were asked whether they would recommend their employer to a friend or family member, and if they would make the same recommendation for other companies.

Headquartered in San Diego, California, Illumina’s first Singapore facility opened in 2008 with ten employees and a 38,000 square foot facility. Today, Illumina Singapore has increased the number of employees to more than 1,300 and grown to three buildings, occupying ten times the original space—now totaling 385,000 square feet. The momentum continues with an additional facility for research and development which is expected to open in the first quarter of 2022.

“We plan to create a complete ecosystem for employees to develop, grow and thrive,” says Lee. “This ethos means focusing on every aspect of an employee’s time with the company from the first moment they walk in the door. We are always assessing the totality of the workplace experience, including onboarding, office ambience, maintaining an open and collaborative culture, training and development, and care and support. Our goal is to provide employees with the best possible end-to-end experience when they work for Illumina.”

About Illumina

Illumina is improving human health by unlocking the power of the genome. Our focus on innovation has established us as the global leader in DNA sequencing and array-based technologies, serving customers in the research, clinical and applied markets. Our products are used for applications in the life sciences, oncology, reproductive health, agriculture and other emerging segments. To learn more, visit www.illumina.com and connect with us on Twitter, Facebook, LinkedIn, Instagram, and YouTube.