Shawn Levy, PhD - Explains Element's $200 Genome

Shawn Levy, PhD - Explains Element's $200 Genome

Summary Transcript

We're really excited to detail some recent announcements around Element’s commitment to continuing to drive access to high value and high performance sequencing and continue to bring some innovative solutions to the field in unique ways. Our recent announcement of our $200 genome is an example of this. We're going to spend a few minutes and provide some of the details on how this program works.

The tag line of Element for a long time has been “Have it All” with AVITI since we launched the instrument in early 2022. The platform offers a truly unmatched combination of performance, cost and flexibility. And the goal of this program is to continue to drive that flexibility and drive that value beyond the specifications you see here on this page: Q30 performance at greater than 90% with a 2x150 read. This is a 2 flow cell instrument where each flow cell is 100% independent, so they can be run the equivalent of 2 machines at the same time. The output for a run is 300 Gigabases per flow cell or 600 Gigabases or more at a paired 150 read-length. And at a 2x75 read-length, that same read output allows costs as low as $1 per million reads at list price. Our announced list pricing when the instrument was launched, was just over $5 per Gigabase at 2x150. We've announced innovative solutions like our loop long read technology, which isn't the focus of today.

What we really wanted to focus on was how we've changed and developed a program around decreasing the cost per sequencing at the 2x 150 read-length to enable applications like genome sequencing or genome sequencing equivalents, whether it be counting applications and things like single-cell, essentially to enable a higher volume use of the platform and drive that value and accessibility.

What we really are announcing is the lowest cost capabilities without having to batch large numbers of samples. This gives opportunities for democratization and gives opportunities for instrument redundancy.

Our platform will run three genomes or equivalents per flow cell at an output of 300 to 330 Gigabases. We have extensive data sets available on our website or available on request to show the 30 to 35 X coverage that these outputs enable on a per genome basis.

And what we're announcing now is a platform program that allows the cost on a per genome basis at these outputs to achieve as low as $200 per genome or $2 per Gigabase. This is available today. This is not a future announcement.

There are some terms and conditions and some volume expectations that we'll talk about in the next couple of slides to give you an idea of how the program works. Essentially this is an opportunity for a benchtop sequencer to reduce costs by eight-fold compared to competing platforms.

Think of this program like an extension of a service contract or an extension of a subscription like model, although a subscription may not capture the nuances quite as well, but it's effectively the more you run the machine, the greater the savings.

And that's detailed here on the left-hand side of the slide in terms of the fold, lower cost to competitors. And on the right-hand slide side of the slide gives us a couple examples of as you increase in numbers of samples, number of kits, number of flow cells run how the price per kit and the price per genome indicated on the graph changes over the quarter and over the year. Beginning with as low as approximately 1000 genomes per year, and then extending to in the neighborhood of 5500 genomes per year. This is an exceptional value program that in across any of those numbers, is a likely a good fit for a laboratory.

As you get above 5500 genomes or 6000 genomes a year, we fully recognize that higher throughput sequencers may end up being more economical solutions. But we still stand by the democratization, the redundancy and the flexibility that the program may still offer at those outputs.

But again, for a benchtop sequencer, our midrange outputs are where we're really focusing this to help laboratories that do not have commitments in tens of thousands of genomes a year or greater, to still be able to access the same value that that larger platforms may bring.

So here's how this looks and a little bit more specific numbers where we have the threshold of usage at 100 flow cells per quarter. This gives an effective kit price of $1380, which is a bit under our list price of $1680 for the kit price.

And then as you see the tearing going to moderate to maximum usage that the the number of instruments that are required as well as the cost per genome, how that changes. So at 3 to 5 instruments with a $600 effective kit price at the maximum use which is running a little over 230 flow cells per quarter, which would require 3 to 5 AVITI instruments. You can achieve the $200 per genome or genome equivalents. In dollars and cents, this means a reagent commitment of just over $500,000 per year. And to give you some perspective on the instrument amortization, if you're running genomes, amortizing our instrument and service contracts together on usual terms adds about $72 per genome. So you're still talking about a very high value per genome with only moderate usage on the platform. Again, our intention here is to continue to drive accessibility, drive flexibility and make the ability to sequence genomes in a very effective manner or genome equivalents for things like high throughput single-cell, high throughput accounting applications, cell-free DNA, any conditions where tens to low hundreds of Gigabases of data are required per sample. This is a this is a great fit.

So some of the key takeaways are summarized on this slide here, it's a membership program, as we talked about.

Think of it in a bit like an extension of a service contract where it's $552,000 per year in installments of $138,000 per quarter. 2000-4000 genomes per year, as I mentioned, 3 to 5 instruments best utilizes this program.

Although it's important to stress that even at lower throughput usage for the same program, you're still driving exceptional value. So at 1500 genomes per year, for example, it's a $400 genome program. At 1000 genomes per year, it's a bit higher than that. As you exceed 3000 genomes per year, you'll continue to access the $200 per genome to as many genomes as you can run, depending on the number of instruments that are available. So again, using fewer kits, although it does raise the effective kit price, it is still a significant discount and a significant program relative to some of our list pricing as well as relative to our competitors.

So I'll thank you all for your attention today. Our sales team and commercial organization would be delighted to explore this, and I think Felicia and I will spend a couple of minutes going over some of the common questions that we've gotten as we've introduced this program.

You mentioned a little bit about the NextSeq in a comparison, but what about the Nova Seq?

The NovaSeq 6000 is a platform that I think if you're in a in a modest amount of genomes a year and those and again low thousands, this program competes very favorably with.

And as we as you extend that to the NovaSeqX and NovaSeqX Plus, that were recently announced, if you're north of 10,000 genomes per year, it's hard to take anything away from those high throughput platforms.

But what we're really trying to address the target of this program are laboratories that don't have the necessary throughput or ability to batch samples into hundreds of samples per run. They want the flexibility of turnaround time of every couple of days, the ability to sequence trios very rapidly, but knowing that they do have enough genomes in aggregate over the year, that that a higher value proposition like we're offering would be a it would be a significant benefit to those labs. That's where this program is targeted. We fully appreciate that this program, either on the high end or the low end, may not be for everybody.

And that's perfectly fine. Why we wanted to take this opportunity for that middle part of the market to drive this accessibility and do something a little bit unique that hasn't been done in the field before.

So if the program is not for a particular lab because of the reagent commitment, our standard commercial offerings are absolutely still available - instrument reagents, etc.. We're delighted to talk about different options. We're delighted to talk about different levels of flexibility.

But again, the point is, we recognize that there's an opportunity for Element to really make a difference in the democratized market and make a difference to those investigators that would benefit from these kinds of values. And so we're excited to put this program forward.

Can you expand a little bit more about the number of instruments and how that fits with this program?

So, you know, the number of instruments is a factor. We know it's a benchtop instrument.We've had a lot of positive feedback from our customers about the our telemetry program and the ability of our instruments to be used in a flexible manner. Again, with the two independent flow cells on each side, that can be run under independent conditions. If you are a laboratory that runs a diversity of applications and maybe genomes are a part of the workflow but not the only workflow, the multiple instrument requirements just add to that flexibility. There's certainly a consideration of having those instruments. But the way we've done the calculations is assuming using our 44 hour run time, approximate run time for each run, whether that's one or two flow cells. And assuming a pretty traditional laboratory schedule of, approximately first shift 5 to 6 days a week where you can get three runs per week. With three instruments, We're running the instruments at the majority of their capacity. With five instruments, it's a much lower total percentage of the capacity. So there's a bit more headroom there for other applications. But we know to achieve the highest value of this program, it really makes sense with 3 instruments.

We've announced at our launch that a 3 instrument purchase allows the instruments to be accessed at $249,000 a piece. So there's a pretty significant discount in those bundle purchases. And then certainly our commercial team can have conversations for instrument purchases that are larger than that.

But overall, it's a super strong value in the field. And we're really hoping that that we can enable some levels of science and capabilities in the genome, in single-cell and cell-free DNA fields that otherwise wouldn't be realized.

There's been a bit of speculation from folks on what's the sweet spot, you know, the ideal customer. Could you describe what you think?

The ideal customer really is that moderate throughput laboratory. And if we just keep the example simple, just focusing on genome equivalents..if it was exome equivalents, it would be, roughly 10 or 12 X, the number of samples that we're talking about to give you similar economies of scale. But important to re-emphasize that this is not limited to any particular application. We're just using genome equivalents because it's been such a common metric to be talked about in terms of instrument output or instrument use, etc. We can certainly talk about that in kit numbers.

Kit numbers are another way to look at this. I think it's also important to state that for any even people who are interested in shorter read lengths, paired 75 or the like, the value of the program continues to make those applications a very, very strong value relative to competing platforms as well.

So while we've been talking about genome equivalents, that's certainly not the only type of customer. We really see applications across the genomic space. We'd be delighted to have to extend those conversations to anyone that thinks this program and its parameters would be a good fit.