BGI Shenzhen Acquires Complete Genomics

[Richard Finney]

MOUNTAIN VIEW, Calif. (AP) -- Chinese genomics company BGI-Shenzhen is buying Complete Genomics for approximately $113.1 million, the companies said Monday. ( http://finance.yahoo.com/news/bgi-sh...150425317.html )

gnews: http://www.google.com/search?hl=en&g....1.q-26R06iZ5I

Blog coverage:

omix: http://omicsomics.blogspot.co.uk/201...-genomics.html

dscan: http://www.genomeweb.com/blog/bgi-stakes-claim

hlogus: http://www.homolog.us/blogs/2012/09/...-21st-century/

[adaptivegenome]

Now BGI gets their US front... And CG is sparred a slow and painful demise...

[pbluescript]

Now BGI gets their US front... And CG is sparred a slow and painful demise...

And I get $3 a share. Whoo!

[Geneus]

And I get $3 a share. Whoo!

Maybe they'll pay you in RMB's (also know as Yuan's).

[ECO]

And CG is spared a slow and painful demise...

Are you sure about that?

[pbluescript]

Maybe they'll pay you in RMB's (also know as Yuan's).

It does sound a bit better at 18RMB/share.

[Richard Finney]

Despite the annoyingly short reads (and my low expectations), the CGI whole genomes aren't that bad. At the reported $5K a pop, it seems pretty cheap.

Questions I'd have are:

Wasn't BGI a research institute? Now it's all o' the sudden an M&A "player" ???

If they're now a now a commercial venture, then what's their path to profit? Are they going to sell their "we sequenced everything" knowledge? Are they going to use cheap labor and "economies of scale" to make the commercial clinical market happen? Will the sample from your next Labcorp visit get fedexed to Hong Kong and processed over there?

Is there "intellectual property" in CGI? Is this just loading up ammo for potential Samsung/Apple type legal battles? Is there some tech that CGI has that needs more capital to exploit?

Is there value in CGI salesforce? Perhaps this gives BGI some recon troops on the ground in the world's biggest market.

Is there some "synergistic" opportunity going down here?

[Geneus]

Despite the annoyingly short reads (and my low expectations), the CGI whole genomes aren't that bad. At the reported $5K a pop, it seems pretty cheap.

Questions I'd have are:

Wasn't BGI a research institute? Now it's all o' the sudden an M&A "player" ???

If they're now a now a commercial venture, then what's their path to profit? Are they going to sell their "we sequenced everything" knowledge? Are they going to use cheap labor and "economies of scale" to make the commercial clinical market happen? Will the sample from your next Labcorp visit get fedexed to Hong Kong and processed over there?

Is there "intellectual property" in CGI? Is this just loading up ammo for potential Samsung/Apple type legal battles? Is there some tech that CGI has that needs more capital to exploit?

Is there value in CGI salesforce? Perhaps this gives BGI some recon troops on the ground in the world's biggest market.

Is there some "synergistic" opportunity going down here?

Lots of questions...for answers, "only the Shadow knows."

[lh3]

BGI is not a research institute. It is a company that does some research...

[krobison]

Wasn't BGI a research institute? Now it's all o' the sudden an M&A "player" ???

Is there "intellectual property" in CGI? Is this just loading up ammo for potential Samsung/Apple type legal battles? Is there some tech that CGI has that needs more capital to exploit?

BGI I think is a bit of a hybrid beast, with some aspects non-profit and some more on a for-profit bent. This has precedent in the U.S. (TIGR as non-profit & HGS as for-profit -- original setup but it did not last), but who knows what structure is available in China.

CG would be expected to have IP around their sequencing process. A BioIT article states they have two issued patents around their Long Fragment Read technology for library preparation.
Google found an interesting little list of patents for CG, though I cannot vouch it is complete nor accurate.

[Geneus]

BGI I think is a bit of a hybrid beast, with some aspects non-profit and some more on a for-profit bent. This has precedent in the U.S. (TIGR as non-profit & HGS as for-profit -- original setup but it did not last), but who knows what structure is available in China.

CG would be expected to have IP around their sequencing process. A BioIT article states they have two issued patents around their Long Fragment Read technology for library preparation.
Google found an interesting little list of patents for CG, though I cannot vouch it is complete nor accurate.

Don't be naive...BGI wants to dominate the world of sequencing...plain and simple. They obviously shy away from that question if it is breached... but trust me, I know this to be the fact.

[Richard Finney]

Welp.
Kinda leads to an obvious question:
Who owns BGI Shenzhen ?

[MrGuy]

My guess is that they wanted their own sequencing technology and this was the only one for sale. Having a customer list is a plus. Looks like there will now be three sequencing technologies on the market?

[Richard Finney]

Bloomberg story from 9/17/2012:

http://www.bloomberg.com/news/2012-09-17/bgi-shenzhen-agrees-to-buy-complete-genomics.html?cmpid=yhoo

More Accurate

Complete Genomics’s sequencing technology gives results slower than that of Illumina Inc. (ILMN), BGI’s major supplier of sequencing machines, said George Church, who advises both Complete Genomics and BGI. However, studies have shown that the technology BGI is acquiring is more accurate than Illumina’s, and Complete Genomics has the potential give results in a time frame that will be useful to doctors, Church said.

The purchase may also reduce BGI’s dependence on Illumina and sequencer-maker Life Technology Corp., said Doug Schenkel, an analyst with Cowen and Co. in Boston.

Most medical genetic testing in the U.S. is overseen by the Centers for Medicare & Medicaid Services under the Clinical Laboratory Improvements Amendment. Complete Genomics has said it expects CLIA approval for a lab this year. The lab would compete with San Diego-based Illumina Inc., which provides clinical genome-analysis services.

IBD story:

http://finance.yahoo.com/news/china-investment-u-track-high-120200945.html

BGI wants to enter the U.S. market for research and medical DNA testing.

[Geneus]

BGI wants to enter the U.S. market for research and medical DNA testing.

Were you aware that BGI sent several (at least 5...perhaps 10?) HiSeqs earlier this year to the CHOP? That lab is already CLIA.