Novogene has agreed to purchase 10 Pacific Biosciences (PacBio) Sequel® System sequencers, allowing the buyer to double to 20 the number of Sequel systems it can run at any one time.

Novogene is the world’s largest user of PacBio’s Sequel System, a nucleic acid sequencing platform launched in September 2015. Sequel System is designed to help researchers generate comprehensive de novo assemblies and advance beyond fragmented draft genomes.

Sequel System is based on PacBio’s unique Single Molecule, Real-Time (SMRT®) technology and includes exceptionally long sequencing reads, uniform coverage, and a level of consensus accuracy that according to PacBio is the highest available.

Sequel System delivers about seven times more reads with 1 million zero-mode waveguides (ZMWs) per SMRT Cell, PacBio says. Other features of the sequencing system include run-time flexibility ranging from 30 minutes to 10 hours per SMRT Cell and run-size flexibility ranging from 1 to 16 SMRT Cells per run.

Novogene’s purchase is its second involving Sequel Systems. Earlier this year, the company acquired access to PacBio’s first 10 Sequel Systems through China’s Nanjing Yangzi State-Owned Investment Group.

“The overwhelming demand for SMRT Sequencing in the few months since we began running the Sequel Systems has required us to double our capacity in a short amount of time,” Novogene founder and CEO Ruiqiang Li, Ph.D., said yesterday in the companies' statement announcing the purchase. “Some of the large projects we have planned include building a database of structural variants in 1000 Chinese individuals as part of the Chinese precision medicine initiative.

Sequencing of Ants

“In addition, we have partnered with the Global Ant Genomics Alliance to sequence 300 different species of ants to provide a comprehensive look at genomic diversity in ant genera,” Dr. Li added.

Novogene also operates the largest SMRT Sequencing service center in the world.

“We are delighted that they have successfully ramped up their utilization of the systems so quickly, and that high demand for SMRT Sequencing services in China has led them to already increase their capacity,” added PacBio chairman and CEO Michael Hunkapiller, Ph.D.

But while Novogene may be the largest user of Sequel System, the company also uses 30 Illumina HiSeq X and 25 NovaSeq 6000 sequencing instrumentswhich according to Novogene gives it the largest and most advanced Illumina sequencing capacities in the world, capable of sequencing 280,000 whole human genomes per year.

During the first six months of this year, PacBio reported $19.7 million from combined sales of Sequel and RSII instruments—a separate Sequel number was not furnished—and $18.1 million from sales of consumables, for total product revenue of $37.8 million.

The Sequel-RSII figure is 20.8% above the $16.3 million reported during January–June 2016, when the company reported total product revenue of $26 million, including $9.7 million from sales of consumables.

“The increase in instrument sales for the six-month period ended June 30, 2017 was primarily attributable to increased Sequel instrument shipments and installations,” PacBio stated in its Form 10-Q for the second quarter, filed yesterday.

However, during the second quarter, Sequel-RSII combined sales dipped year-over-year by 17%, to $7.1 million from $8.6 million. Consumable sales nearly doubled from $5 million to $9.4 million, which allowed for total product revenues to show a nearly 22% increase, to $16.548 million.

The quarterly year-over-year decline in total revenue was 3%, to $20.1 million in Q2 2017 from $20.7 million a year earlier, since unlike Q2 2016, PacBio did not receive $3.6 million in contractual revenue from Roche, after it terminated a contract with PacBio effective February 10.

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