Last Updated Mar 8, 2010 2:59 PM EST
In a research report published on Friday, analyst Isaac Ro said that although the company's single molecule sequencer is improving, the company faces major challenges gaining market share against the growing competition.
There's a good analysis at GenomeWeb:
Analyst Isaac Ro said in a research note published Friday that although the firm's flagship HeliScope single-molecule sequencer has shown improvement, "time is running out."
He said that although Helicos deserves credit for being the only commercial provider of single-molecule sequencing technology on the market today, future competitors are also "struggling with their own SMS-based platforms, which we think underscores the high cost and long development times required to achieve such a feat."
"We think HeliScope is ultimately limited to a very small target audience at a price point of $800k that remains prohibitive to most customers," Ro wrote.This decision is a big setback for Helicos in the competition for the Holy Grail $1000 genome price point, which most agree is the price to hit for sequencing to be embraced by doctors and insurance companies.
Since the company launched two years ago, it sold its sequencer to just fourteen clients. With stiff competition from Illumina,Inc. and start-ups like Pacific BioSystems, which recently announced critical partnerships for gaining market share, and Ion Torrent, which recently unveiled a $50,000 sequencer, it's clear that Helicos's is also just not moving fast enough.
Last November, Helicos announced it had $8.4 million in revenues and expected that between that income and sales of products, it would be in good shape through the first quarter of 2010. The Leerink Swan announcement is not a good sign for the company's future cash flow, and now that numerous companies are selling cheaper machines, the Helicose machine is much too expensive to meet the company's own sales projections. Look for trouble ahead.
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