By Allison Proffitt
January 12, 2024 | Christian Henry, President and CEO of Pacific Biosciences, was unabashedly cheerful at the JP Morgan Healthcare Conference on Wednesday afternoon when he gave the updates for PacBio. “2023 absolutely exceeded our expectations,” he said. The company began shipping both its Revio long-read sequencer, and its Onso short-read sequencer, in 2023, both of which had been developed over the course of 2022. A year ago at JP Morgan, Henry predicted 2023 would be a pivotal year for the company, and this year he basked in two platform launches, strong consumable growth, and three new platforms in development.
“Our strategy is really to span the entire market with best-of-breed technologies that serve our customers,” he said.
Revio Long-Reads
“In 2023, long-read sequencing was the method of the year,” Henry claimed. “This is on the back of completing the first telomere to telomere genome, so really, truly the first fully-sequenced genomes. What we’re seeing is, based on all of that discovery, now our customers and researchers around the world are really focusing on, ‘How do we build long-read pan genomes across all of the different sample types of human diversity?’”
PacBio’s newest long-read platform, Revio, aims to fill that need.
The Revio long-read platform is PacBio’s most scalable and economic long-read sequencer, Henry said. Revios began shipping in March 2023, and have shipping 173 systems since. Revio is based on PacBio’s HiFi sequencing, best suited for germline-driven genomics, including complex diseases research, clinical whole genomes, plant and animal biology, and immunology, Henry said. HiFi enables full isoform and full transcriptome research, improving RNA analysis, and every run gives methylC calls. “It’s becoming more and more apparent that epigenetics is absolutely fundamental to our understanding of how DNA is actually regulated,” he said.
Revio provides highly accurate sequencing, 15x more powerful than any other sequencer, he added. “It gives us the ability to sequence over 1,000 genomes per year on the system, at a price under $1,000 per genome. We’re finally unlocking the scalability and affordability required to do population-scale research from telomere to telomere.”
PacBio is still shipping Sequel II and IIe platforms as well, shipping 532 Sequel platforms in 2023, up from 2022’s 512. Consumable growth, however, has been driven by Revio, indicating strong uptake by Revio customers. In addition to software and kit news PacBio announced in November at ASHG, Henry predicted high throughput DNA prep and targeted native DNA kits available in the first half of 2024.
Onso Short-Reads
The second 2023 platform launch for PacBio was Onso, a short-read platform using the sequencing-by-binding (SBB) chemistry that PacBio acquired with Omniome in July 2021. Onso and the SBB chemistry allows PacBio to dive into therapy selection, liquid biopsy, and oncology applications.
Onso began shipping in 2023 though Henry did not report placement numbers for Onso. He calls Onso a mid-range short read sequencer with unprecedented accuracy. “It’s quite extraordinary! Over 90% of the bases are Q40 or better, and in fact, when you look at a particular read, you can the accuracy from the… last base being nearly as high as the first base. No other sequencer on the market’s been able to show that,” he said.
That accuracy gives the customer choice, he said. “Either they can sequence less at lower cost, or sequence more to see at resolution that is really unprecedented.”
Henry said the company is so excited about the SBB chemistry, that they are developing a high-throughput short read platform based on their April acquisition of Apton Biosystems and their high-throughput instrument.
Forward Looking Statements
Henry predicts a coming bifurcation in the sequencing market, splitting the field nearly evenly between short- and long-read sequencing. “Virtually all the germline genomic applications can benefit from a more comprehensive view of the genome. It’s just that simple. You can see parts of the genomes that you can’t see with short reads… You get more value per dollar by moving to long reads,” he said. He argues that the value of what long read sequencing can reveal will overwhelm a shrinking cost difference between short and long reads. “On the other hand, there’s still going to be a very significant opportunity for short reads in the market as liquid biopsy and other oncology applications,” he conceded. “I think we could be almost as much as a 50%-50% split.”
That’s why PacBio’s goal is to create targeted tools to address the entire sequencing market—both long and short read—at varying throughputs. In addition to the newly released Revio and Onso platforms, Henry listed three new PacBio instruments in development: a population-scale HiFi platform; a benchtop HiFi sequencer that will be, “an important product for us to get to market so we can make HiFi long-read sequencing ubiquitous throughout the community and serve as a feeder into the Revio platform,” and a high-throughput SBB short-read sequencer to focus on scaled liquid biopsy applications built on the April Apton Biosystems acquisition.
But growth isn’t only coming from these new platforms. Henry also reported very strong consumable growth in 2023, driven by Revio adoption. “As we ship more and more Revios and they drive a high level of consumables, our consumable revenue will become greater than our instrument revenue—and consumables carry a higher gross margin—so we will get a natural lift.”
Along with these drivers, Henry reported plans to optimize all stages of the supply chain, tweaking manufacturing practices for both instruments and consumables to increase yield and grow gross margin. He said PacBio is on track to achieve more than $500 million in revenue and be cash flow positive by the end of 2026.
“We are very well positioned to achieve our goals,” Henry said in closing. “They’re ambitious, but we have an incredible team in place."