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Illumina and Roche Combine For Genomics Oncology Deal

Top DNA sequencing company Illumina (NASDAQ: ILMN) has signed a pact with global pharmaceutical giant Roche (OTC: RHHBY) in the field of oncology, the Illumina's CEO Francis deSouza announced.

On Monday, deSouza shared the news at the high-profile annual J.P. Morgan Healthcare Conference that his company and Roche signed a 15-year non-exclusive collaboration deal centered around next-generation sequencing (NGS) diagnostics in the field of oncology.

Image source: Getty Images

The mechanics of the deal are that Roche will hold rights to "develop and distribute in-vitro diagnostic (IVD) tests on Illumina's NextSeq 550Dx System, as well as on its future portfolio of diagnostic (Dx) sequencing systems, including the forthcoming NovaSeqDx," according to a subsequent Illumina press release.

For its part, "Roche will in turn collaborate with Illumina to complement Illumina's comprehensive pan-cancer assay, TruSight Oncology 500 (TSO 500), with new companion diagnostic (CDx) claims."

Under the terms of their arrangement, Roche will have the right to develop, produce and sell IVD testing products to be used on the NextSeq 550Dx. The two companies will additionally collaborate to develop tests and CDx claims for oncology treatments on that system.

Neither Illumina nor Roche provided the financial terms of their new collaboration. The two also did not provide estimates as to how it would impact their respective businesses. They did tout the synergistic benefits of the tie-up. In its own press release, Roche said the deal "leverage[s] our combined expertise in clinical oncology and next-generation sequencing."

Despite the promising news, neither healthcare stock is seeing a bounce. Illumina's stock is down slightly in late afternoon trading. Roche's stock remains flat.

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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Illumina. The Motley Fool has a disclosure policy.


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