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Pacific Biosciences Launches New Nucleic Acid Sequencing Platform Based on Its Single Molecule, Real-Time (SMRT) Technology; Sequel™ System Said to Offer Significantly Higher Throughput, Reducing Project Costs and Timelines

On September 30, 2015, Pacific Biosciences of California, Inc., (NASDAQ:PACB), a pioneer and leader in long-read sequencing using its Single Molecule, Real-Time (SMRT®) Technology, announced that it has launched a new nucleic acid sequencing platform. The Sequel™ System (photo) provides higher throughput, more scalability, a reduced footprint and lower sequencing project costs compared to the PacBio® RS II System, while maintaining the existing benefits of the company’s SMRT Technology, the company said. Pacific Biosciences will showcase the new product at the American Society of Human Genetics (ASHG) 2015 annual meeting taking place in Baltimore, Maryland from October 6 through October 10. The core of the Sequel System is the capacity of its re-designed SMRT Cells, which contain one million zero-mode waveguides (ZMWs) at the product’s launch, compared to 150,000 ZMWs in the earlier SMRT Technology instrument, the PacBio RS II. Active individual polymerases are immobilized within the ZMWs, providing windows to observe and record DNA sequencing in real time. With approximately seven times as many reads per SMRT Cell as the PacBio RS II, customers should be able to realize lower costs and shorter timelines for sequencing projects, with approximately half the up-front capital investment compared to previous technology. The Sequel System also occupies a smaller footprint — less than one-third the size and weight — compared to the PacBio RS II. Because the new system is built on the Pacific Biosciences established SMRT Technology, most aspects of the sequencing workflow are unchanged.

Michael Hunkapiller, Ph.D., CEO of Pacific Biosciences, and an inventor of the first-ever automated protein sequencer and also of the first-ever automated DNA sequencer, commented: “We are extremely proud to introduce the Sequel System, which provides access to the existing benefits of SMRT Sequencing, including long reads, high consensus accuracy, uniform coverage, and integrated methylation information – a set of core attributes first pioneered with the PacBio RS.”

“The system’s lower price and smaller footprint represent our continued commitment to leveraging the scalability of our technology and the unique characteristics of SMRT Sequencing.”

“Moreover, with its lower cost of goods (approximately a quarter that of the PacBio RS II), we expect to be able to achieve substantial gross margin improvement and move more quickly toward profitability.”

“We will continue to support our PacBio RS II customers, and we expect to introduce improvements in sample prep, sequencing chemistry, and software that will extend the performance of that system, as we have done each year since the initial commercialization of the PacBio RS in 2011 and the PacBio RS II in 2013.”

“We expect to make similar, substantial performance improvements each year for the Sequel System,” Dr. Hunkapiller added. “In addition, the Sequel architecture provides the ability to scale throughput by substantially varying the number of ZMWs on future SMRT Cells, thereby optimizing throughput and operating costs for specific applications.”

The Sequel System is designed for projects such as rapidly and cost-effectively generating high-quality, whole-genome de novo assemblies. It can provide characterization of a wide variety of genomic variation types, including those in complex regions not accessible with short read or synthetic long-range sequencing technologies, while simultaneously revealing epigenetic information.

The system can also be used to generate data for full-length transcriptomes and targeted transcripts using the company’s Iso-SeqTM protocol.

The Sequel System’s increased throughput should also facilitate applications of SMRT Technology in metagenomics and targeted gene applications for which interrogation of larger numbers of individual DNA molecules is important.

The Sequel System has been developed as part of the Pacific Biosystems’ collaboration with F. Hoffman-La Roche Ltd (Roche) to ultimately provide a nucleic acid sequencing system for use in human in vitro diagnostics.

Under that agreement, Roche agreed to pay Pacific Biosciences a total of $40 million in milestone payments related to the development of the Sequel System. Pacific Biosystems previously reported that it has earned $20 million to date, and now expects to earn the remaining $20 million during the fourth quarter of 2015.

“We congratulate Pacific Biosciences on the launch of the Sequel instrument,” said Dr. Dan Zabrowski, Head of Roche Tissue Diagnostics and Head of Roche Sequencing Unit. “This new sequencing platform has significant advantages over existing commercial platforms, and will be used as the basis for the Roche sequencing instrument being developed initially for clinical research, followed later by an IVD instrument launch. We anticipate the initial launch in the second half of 2016.”

Pacific Biosciences expects to begin limited shipments of the Sequel System in the United States during the fourth quarter of this year and start scaling the manufacturing process for the Sequel Systems and the new SMRT Cells during early 2016. Shipments outside the U.S. are expected to commence thereafter.

A portion of the initial Sequel instruments will be delivered to Roche to expand its internal assay development program. The U.S. list price for the Sequel System is $350,000. It is currently available for Research Use Only.

Pacific Biosciences will host a workshop titled “Addressing Hidden Heritability through Long Read Single Molecule, Real-Time (SMRT) Sequencing” at the ASHG annual conference on Wednesday, October 7, 2015 from 1:00 p.m. to 2:30 p.m. Eastern Time at the Sheraton Inner Harbor Hotel, Baltimore. The event will be hosted by Dr. Michael Hunkapiller and Dr. Jonas Korlach from Pacific Biosciences, and will include presentations by renowned sequencing experts Dr. Richard Gibbs from Baylor College of Medicine and Dr. Richard Wilson from Washington University in St. Louis.

Those attending the ASHG conference in Baltimore can register at http://programs.pacificbiosciences.com/l/1652/2015-09-03/3dnqwp. The company will also offer LIVE streaming and access to the recording; for more information, click http://programs.pacificbiosciences.com/l/1652/2015-09-09/3dqqct. ASHG attendees can also visit the Pacific Biosciences booth (#907) during the conference.

CONFERENCE CALL RECORDING AVAILABLE

Pacific Biosciences management hosted a conference call to discuss this announcement on Thursday, October 1, 2015. The call was recorded and is available for replay on the Pacific Biosciences’ website (investors section) at http://investor.pacificbiosciences.com/.

PACIFIC BIOSCIENCES

Pacific Biosciences of California, Inc. (NASDAQ:PACB) offers sequencing systems to help scientists resolve genetically complex problems. Based on its novel Single Molecule, Real-Time (SMRT®) Technology, Pacific Biosciences’ products enable the following: de novo genome assembly to finish genomes in order to more fully identify, annotate and decipher genomic structures; full-length transcript analysis to improve annotations in reference genomes, characterize alternatively spliced isoforms in important gene families, and find novel genes; targeted sequencing to more comprehensively characterize genetic variations; and DNA base modification identification to help characterize epigenetic regulation and DNA damage.

Pacific Biosciences’ technology provides the industry’s highest consensus accuracy over the longest read lengths in combination with the ability to detect real-time kinetic information. The Sequel System, including consumables and software, provides a simple, fast, end-to-end workflow for SMRT Sequencing. More information is available at www.pacb.com.

[Pacific Biosciences press release] [Conference call recording available here] [Pacific Biosciences web site] [ASHG 2015 annual meeting web site]

[The Scientist article] [Genome Web article]