Since the last edition of Kalorama Information's DNA Sequencing Equipment and Services report, the market has been changing in unpredictable ways as second-generation sequencers are being incrementally introduced and upgraded. On the surface, the situation has become somewhat linear and predictable, but as Kalorama Information biotech analyst Justin Saeks explains, it is actually a unique and relatively volatile situation that is not seen often with life science tools markets. Third-generation systems have the potential to completely change the market, or to simply join the pack.
Revenue growth has been unusually high, and all of the trends seem to indicate that growth will continue in the near term. It is likely that completely new technologies will be introduced at least every year or two, while second-generation sequencer improvements also continue. In Kalorama Information biotech analyst Justin Saek's 2nd edition of DNA Sequencing Equipment and Services Markets, these changes are detailed and put in context, along with the following:
Kalorama Information's DNA Sequencing Equipment and Service Markets represents research culled from a variety of secondary sources. But the true insights originated from interviews with market experts; these interviews were used to confirm numbers and test forecast assumptions.
Companies profiled in the report include:
- Rapid increase in output from second-generation DNA sequencers has enabled new levels of productivity and new experiments. This, along with funding from the stimulus bill, has caused rapid adoption of these machines, according to healthcare market research firm Kalorama Information, helping to fuel sales of DNA sequencers to $480 million in 2008. In its report DNA Sequencing Equipment and Services Markets, 2nd Edition, Kalorama says more changes are on the way and will drives sales growth of 19% annually through 2013.
“We expect growth in this market - and some of it will be due to new NIH grants originating from ARRA stimulus money,” said Justin Saeks, Kalorama Information’s biotech analyst. “But it’s not all government spending. There are also factors in the private sector that will fuel sales of sequencers, including a rapid increase in output from second-generation sequencers, decreasing costs of newer machines through competition, and potential applications in the pharmaceutical industry following the realization that personalized medicine, biomarkers, and other related post-genomic approaches are likely to counter shrinking pipelines. In the long term, clinical and industrial segments could far surpass the research market.”
Second-generation technologies have seen rapid improvements since they were introduced. Output has been roughly doubling each quarter for the Illumina Genome Analyzer II and the ABI SOLiD 3; both have improved read length. 454 Life Science’s Genome Sequencer FLX also has improved read length and output. This trend is anticipated to continue for at least another year, bringing the output to 100 gigabases per run.
The most recent system, Dover’s Polonator, introduced in mid-2009, is much less expensive than the other second-generation systems at about $170k instead of $400-600k. It is open-source, supports different running modes, and allows users to change protocols. Though it is potentially a disruptive technology, it is still too early to tell and inevitably more advances will appear soon.
However, all these improvements may not be rapid enough. The initial flurry of activity with second-generation systems seems to have died down, and now in mid-2009 it feels like the calm before the storm. The market remains highly volatile and things can change rapidly - patent disputes have occurred on a frequent basis, and disruptive third-generation technologies will begin to appear in the next year or two. Like the second generation, they will be completely new techniques.
More information on DNA sequencing markets can be found in Kalorama Information’s new report DNA Sequencing Equipment and Services Markets, 2nd Edition, which discusses trends, challenges, strategies, companies and products, and provides estimates of market share and revenue growth. The competitive situation, deals, and litigation are covered as well.
Learn how to effectively navigate the market research process to help guide your organization on the journey to success.Download eBook