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Illumina (ILMN) New Collaboration to Aid Genomics Startups

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Illumina, Inc. (ILMN - Free Report) recently announced a China-based collaboration to establish a startup ecosystem for the development of a genomic incubator therein. The company partnered with Sequoia Capital China to establish this startup incubator called the Sequoia Capital China Intelligent Healthcare Genomics Incubator, Powered by Illumina.

With this alliance, Illumina will focus on establishing life sciences startup companies specialized in genomics.

Notably, Illumina has a good track record of developing venture-based genomics startup companies through Illumina Accelerator in the United States and U.K.

With the latest collaboration, Illumina aims to strengthen the genomics business worldwide.

More on the Alliance

Sequoia Capital China Intelligent Healthcare Genomics Incubator will utilize Illumina’s scientific expertise of building startups focused on genomics, while Sequoia Capital China will provide investment expertise and access to entrepreneurs.

Notably, the new incubator will have two funding cycles per year, each six months long. It will provide preferred startups with access to investment and business guidance from Sequoia Capital China. Also, it will give access to Illumina’s sequencing systems, reagents and genomics expertise. All this will be carried out in a fully operational laboratory space in Shanghai, China. The first funding cycle will start in autumn 2021.

Significance of the Collaboration

Per management, collaboration with Sequoia Capital China will enable Illumina to partner with leading entrepreneurs for developing genomics startup companies that offer specialized genomics applications and clinical sequencing solutions, which mobilize the unique strengths and dynamic markets in China.

The partnership will boost and nurture the founders in the field of genomics in China by bringing advanced genomics technologies and innovative models in the market. The collaboration is likely to fuel the genomic startup ecosystem in China and will help in promoting the development of human wellbeing.

Industry Prospects

Per a report by MarketsandMarkets, the global genomics market was valued at $18.9 billion in 2019 and is projected to reach USD 35.7 billion by 2024 at a CAGR of 13.5%. Factors like growing institutional support for genomic research projects, significant decrease in sequencing costs and increasing applications of genomics are likely to drive the market.

Recent Notable Developments

In January 2021, Illumina collaborated with renowned population genomics company, Helix, to increase the national surveillance infrastructure in the United States for tracking the emergence and prevalence of novel strains of SARS-CoV-2 UK Variant (B.1.1.7). The combination of Illumina’s sequencing technology and expertise, and Helix’s national COVID-19 testing footprint will considerably expand the country’s existing surveillance efforts to detect as well as characterize the emerging variants of SARS-CoV-2.

In the same month, Illumina partnered with Myriad Genetics to provide comprehensive genomic profiling of tumor samples and derive better outcomes in oncology. Per the agreement, Illumina will create a kit-based version of Myriad Genetics’ myChoice companion diagnostic test for the international market.

Price Performance

Shares of the company have gained 45.3% in a year’s time compared with the industry’s 14.4% rally.

Zacks Rank and Key Picks

Currently, Illumina carries a Zacks Rank #5 (Strong Sell).

Some better-ranked stocks from the broader medical space include Acorda Therapeutics, Inc. , Alexion Pharmaceuticals, Inc. and Anavex Life Sciences Corp. (AVXL - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of Zacks #1 Rank (Strong Buy) stocks here.

Acorda Therapeutics has a projected long-term earnings growth rate of 14%.

Alexion Pharmaceuticals has a projected long-term earnings growth rate of 6%.

Anavex Life Sciences has a projected long-term earnings growth rate of 9%.

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