NextCODE has made a sharp exit. Just 15 months after some ex-deCode Genetics executives struck a deal with Amgen ($AMGN) to create NextCODE, Chinese CRO WuXi PharmaTech ($WX) has bought the genomic analysis startup for $65 million in cash.
The rapid path from creation to sale contrasts vividly with the history of deCode, which toiled for 14 years and went bankrupt before securing a $415 million buyout from Amgen. In 2013, some of the executives who guided deCode through those years licensed a platform back from Amgen and set up NextCODE. The startup has used the deCode platform and $15 million in VC funding to develop a browser-based way to quickly visualize and share aligned raw sequence data.
WuXi has seen enough potential in the platform to open its checkbook. The Shanghai, China-based CRO has made a concerted push into genomics in recent years, notably by acquiring a HiSeq X Ten sequencing system from Illumina ($ILMN). WuXi has recently received the last four of its HiSeq X machines, positioning it to offer large-scale clinical and research genomics services. NextCODE will support the analytics and bioinformatics component of the operation.
The combined organization will take the name WuXi NextCODE Genomics and run operations out of Shanghai, Cambridge, MA and Reykjavik, Iceland. In the near term, the deal will have little impact on WuXi's financials--Wells Fargo analysts added $4 million to their 2015 revenue forecast--but the bigger bet on genomics services is important to the company. With NextCODE on board and a HiSeq X Ten in operation, WuXi has the infrastructure. Now it needs to make the genomics business work.
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