About Small Caps Article of the Week
Written by Allen Caron, About Small Cap
In the world of molecular analysis, one long-term goal has been the creation of cost effective genome sequencing. A recent announcement from Illumina, Inc. (Nasdaq:ILMN), the world’s leading seller of gene sequencing machines, marks the near accomplishment of this goal. Illumina recently unveiled its HiSeq X, the first ever DNA-crunching supercomputer. The system is designed to process 20,000 genomes per year at a cost of only $1,000 each, a far cry from the current cost of genome sequencing, which is about $10,000. Illumina expects that customers will begin receiving the machine this quarter.
Companies have been trying to accomplish high-speed, low-cost sequencing just like this for years. The $1,000 price tag is one that should make full genome sequencing much more mainstream, allowing more people to get sequenced, providing more data for researchers, and paving the way for more clinical breakthroughs fueled by this surge in available data.
It’s not just big companies working on molecular analysis, however. A number of top small cap companies are also pursuing related milestones, including:
San Diego-based Sequenom, Inc. (Nasdaq:SQNM), for example, specializes in noninvasive methods of testing through molecular diagnostics and genetic analysis. Sequenom recently announced an exclusive agreement with Nicox Inc. for the North American promotional rights to the Sequenom Laboratories RetnaGeneTM AMD laboratory-developed test, for the evaluation of a patient’s risk of age-related macular degeneration (AMD) disease progression within 2, 5 and 10 years. Jerry St. Peter, Executive Vice President and General Manager of Nicox Inc., said,
“AMD affects approximately 15 million people in the United States and is a leading cause of vision loss in Americans aged 60 and over. The ability to identify those patients most at risk of progressing to wet AMD represents a major opportunity to optimize the management of their disease.”
SQNM closed March 3 at $2.34, up one cent for the day. Its market cap is $270.78 million, and its 52 week trading range is $1.65 – $4.90.
Irvine, CA-based CombiMatrix Corporation* (Nasdaq:CBMX), similarly, is a molecular diagnostics laboratory performing DNA-based testing services for developmental disorders and cancer. In late January, the company entered into a contractual agreement with Galaxy Health Network for coverage of CombiMatrix’s diagnostic laboratory services. Galaxy Health Network has a current member base of more than 3.5 million people. These members now have access to CombiMatrix’s suite of molecular diagnostic solutions and comprehensive clinical support – specializing in prenatal, miscarriage and pediatric health care. CBMX closed March 3 at $2.82, down $0.02 for the day. Its market cap is $13.36 million, and its 52 week trading range is $2.14 – $4.62.
GenMark Diagnostics, Inc (Nasdaq:GNMK), based in Carlsbad, CA, is another small cap working in the space. GenMark is a molecular diagnostics company focused on developing and commercializing its eSensor detection technology, which enables detection of up to 72 distinct biomarkers in a single sample. The company’s XT-8 System, which has received 510(k) clearance from the FDA, is designed to support a range of molecular diagnostic tests with a compact workstation and self-contained, disposable test cartridges. GNMK closed March 3 at $12.18, down $0.25 for the day. Its market cap is $511.07, and its 52 week trading range is $8.75 – $16.00.
Pacific Biosciences of California (Nasdaq:PACB), based in Menlo Park, CA, is a biotechnology company that develops, manufactures, and markets an integrated platform for genetic analysis. The company’s Single Molecule, Real-Time (SMRT®) Sequencing technology enables real-time analysis of biomolecules with single molecule resolution, which has the potential to transform the current understanding of biological systems by providing a window into these systems that has not previously been open for scientific study. PACB closed March 3 at $6.75, up $0.17 for the day. Its market cap is $453.98 million, and its 52 week trading range is $1.95 – $8.20.
Los Angeles-based Response Genetics, Inc. (Nasdaq:RGDX) is a CLIA-certified clinical laboratory focused on the development and sale of molecular diagnostic testing services for non-small cell lung cancer, colorectal cancer, gastric cancer and melanoma. These tests help doctors assess the risk of chemotherapy efficacy, cancer recurrence and tumor classification. In March 2010, the company entered into a non-exclusive license agreement with GlaxoSmithKline LLC (“GSK”). GSK was granted a non-exclusive, sublicenseable license to Response Genetics’ proprietary PCR analysis technology and diagnostic expertise to assess BRAF gene mutations in human tumor samples. The agreement entitled Response Genetics to certain milestone payments, the third of which was received by the company in January of this year. RGDX closed March 3 at $1.43, up $0.02 for the day. Its market cap is $49.66 million, and its 52 week trading range is $1.09 – $2.93.
Processing genomes for under $1,000 has been a longstanding milestone. Of course, the work doesn’t stop just because it’s been reached. These small cap companies are each developing new opportunities for technology investment in the molecular analysis field. This may well be a field worth watching moving forward.
The About Small Cap blog covers breaking news on small cap stocks from around the world, delving deep into pressing issues both large and small that affect small caps. For example, we recently covered groundbreaking news about artificial heart technology in the small cap world. We write about things like natural gas drilling and interviews with notable personalities across a wide variety of industries, like Elemer Piros in the biotech sector.
