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MGI Announces US$200 Million in First Round Fundraising


On May 9, 2019, MGI disclosed that its first round of fundraising exceeded US$200 million, the largest amount of capital raised in the genetic field in China in 2018. Investors included well-known institutions such as CITIC, Jinshi Capital, Songhe Capital and Dongzheng Capital.

MGI Highlights Rapid Progress in Transforming Industry

In recent years, the gene sequencing industry has developed rapidly and attracted a large number of capital and enterprises. With the sharp reduction in the cost of sequencing, more and more ordinary people are beginning to enjoy the benefits of gene sequencing, which further promotes the universal popularity of high-throughput sequencing systems in medical and scientific research. In 2016, in order to break through the dilemma of domestic genetic sequencing core technology and provide solutions, BGI Group filled the gap in the upstream industry and established MGI, a subsidiary gene sequencing equipment company. MGI is committed to the development and manufacture of a series of life digital products such as the industry's leading core sequencing platform, supporting reagents and consumables, and accelerating the localization of genetic sequencers.

Core Technology DNBSEQTM Breaks Upstream Monopoly

The gene sequencer is the upstream core of the gene sequencing industry and a decisive device in the genetic testing, gene editing, and gene synthesis industries. For a long time, the upstream technology of gene sequencing has been controlled by a few foreign companies and has strict patent protection. In order to break the monopoly situation, MGI successfully developed advanced DNBSEQTM sequencing technology through the introduction and innovation of technology, and adopting different technical routes.

DNBSEQTM sequencing technology mainly includes: DNA single-chain cyclization and DNB preparation, patterned array chip, DNB loading, cPAS, double-end sequencing technology, and base recognition algorithm. In the DNBSEQTM sequencing technology, the instrument gas-liquid system first pumps the DNA nanoballs into a patterned array chip and fixes them, then pumps the sequencing template and the sequencing reagent to finally obtain the base sequence information of the sample to be tested. At present, cPAS has been widely used in BGISEQ-500, BGISEQ-50, MGISEQ-200, MGISEQ-2000 and MGISEQ-T7 gene-type sequencers developed by MGI.

Compared with other existing sequencing technologies, DNBSEQTM sequencing technology combines the low error accumulation of DNB and the high signal density of patterned

array chips , which can improve the detection accuracy and achieve more efficient and massively  parallel sequencing. For example, in specific applications such as WGS/WES, the technology produces data with a low repetition rate, which reduces data waste. The PCR-free based library construction method also has better SNP and InDel accuracy. In addition, the BGISEQ/MGISEQ series of sequencing platforms have fewer label hops, which can also effectively reduce the problem of sample misallocation.

In addition, in response to the shortcomings of the industry's long-read- sequencing, in 2018, MGI also released a new generation of long-segment database technology - stLFR (single-tube long fragment read). Currently, kit products based on this technology have been officially launched. Compared to traditional WGS libraries and other similar products, the stLFR library requires only 1 ng of DNA and can obtain high-quality whole-genome sequencing libraries without pre-amplification. The diploid phase-determining block has a

N50 value of 10 Mb, which can be effectively detected. Structural variability such as position, ectopicity, deletion, etc., enables structural variation detection that cannot be achieved by conventional means, and achieves the optimal level of performance of conventional whole genome sequencing libraries at the same depth. In addition, the product has no separation reaction in a single tube, and no micro pipetting equipment or complex microfluidic system is required; all the reactions are completed on the magnetic beads, which facilitates high-throughput automated database construction, thus greatly reducing the complexity of long-segment library construction and cost.

From the initial acquisition of US company Complete Genomics for core technology, independent control of gene sequencing tools, and securing core patents, MGI is gradually

breaking the market monopoly of foreign companies in the upstream of the gene sequencing industry. In October 2018, the British government announced that it would launch a 5 million genome program. Chen Zhengming, a professor of epidemiology at Oxford University, said that the UK has compared the technology provided by MGI's sequencing technology with that provided by other companies Comparing the same sequence, the sequencing from MGI demonstrated excellent results.

Creating an All-Around Digital Life Product

In recent years, with the rapid development of gene sequencing technology, the global market for gene sequencing is moving from scientific research to clinical, and the market scale has entered a high-speed growth period. Some research estimates predict that the global sequencing industry market will reach 12.45 billion US dollars in 2022, of which the Asia-Pacific region will reach 2.39 billion US dollars. By 2020, the market size of China's gene sequencing industry will reach 9.8 billion Yuan. In the next few years, the domestic market demand for genetic sequencing will steadily expand, and the market scale will maintain a good growth.

The genetic industry market is leading the world of technology. In the eyes of the industry, MGI is considered to be one of the important technology developers in the field

of genetic technology. The key is its continuous investment and breakthroughs in upstream sequencing technology. Up to now, the company has invested a total of about 5 billion Yuan in research and development to achieve a foundation of patents of sequencing technology, applying for more than 580 technical patents, including more than 80 PCT patents.

Relying on its own technology direction and continuously strengthening its technological advantages, MGI has launched a number of different sequencers since 2015. The full range of product types and the need to cover both miniaturization and high throughput are becoming a major enabler for the company to expand into the global market.

As the main model, the MGISEQ-2000 comprehensive gene sequencer launched by MGI can support two different specifications of the chip on the basis of the two-chip independent operation platform. Its single operation can complete a maximum 1080Gb offline data. It only takes 48 hours to run at full load in PE100 read length mode, and the running of one year is equivalent to more than 1000 human genome data. The MGISEQ-200 feature released at the same time is more convenient and flexible. It can generate 60Gb of offline data under full load in PE100 read length mode. It takes less than 48 hours to complete the rapid detection of 24 tumor samples on average one day. In addition, the company's MGISEQ-T7, released in October 2018, is the "star" model in its product layout. The MGISEQ-T7 is still the most powerful gene sequencer in the world. The single-day data output can reach 6Tb, PE150 sequencing takes only 24 hours, and the cost per Gb sequencing is only 5 US dollars -- the lowest sequencing cost in the world.

At present, more than 1,100 MGI sequencers have been installed globally, covering 16 countries and regions, with over 300 users. The cumulative output data has

reached 20Pb, and more than 300 high-level scientific research papers have been published. Recently, MGI also cooperated with the Institute of Chinese Medicine of China Academy of Chinese Medical Sciences to develop and publish a high-throughput gene sequencing integrated machine for Chinese herbal DNA barcodes. The instrument is the world's first intelligent identification instrument for Chinese herbal medicine gene sequencing, which can accurately and quickly identify Chinese herbal medicine samples. This initiative has further stimulated product customization needs in other domestic market segments.

At the same time as the full range of sequencer products, MGI has successfully developed a series of core technologies such as sequencing reagents, materials and biochemical reaction systems, and laid out a full range of products. In addition to the stLFR database kit, MGI also independently developed the base recognition algorithm Sub-pixel Registration, which makes the image registration accuracy reach the sub-pixel level, greatly improving the accuracy of base recognition. With the GPU-accelerated method,acceleration of more than 200 times is achieved under the condition of higher precision algorithms. Realizing the real-time image processing and base recognition while improving the recognition accuracy, it achieves industry leading data processing speed. In addition, MGI also invented a new method of fluorescence and base binding using antibodies as a medium to further improve the accuracy of read length and sequencing.

Promoting the Healthy Development of the Gene Sequencing Industry

Since the development of gene sequencing technology, sequencing throughput has continued to increase rapidly. Under the existing sequencing technology, people have made

great progress in understanding and preventing various diseases, but they still face many technical challenges in gene identification. Therefore, future knowledge of the disease still requires constant updating of technology and equipment.

Looking at the world, the closed nature of the genetic sequencer market has made it difficult for industry downstream manufacturers to obtain sufficient choice of technology

and service support. Breaking through the core technology of upstream sequencing of genes is inevitable. Through technology introduction and independent innovation, MGI adopts different technical routes and is moving towards faster and more accurate sequencing technology, providing a strong impetus for the healthy development of China's genetic sequencing industry.

According to industry insiders, the cutting-edge enterprises represented by MGI are catching up with the industry giants in terms of originality of technical products. Following the progress of its sequencing technology, MGI has persevered and relied on a strong R&D team to successfully develop automation equipment and consumables. Through independent research and development, MGI gradually broke the market monopoly of foreign companies, and achieved breakthroughs in the upstream of China's genetic technology industry, making up for the gap in this field.

In addition to large-scale application in scientific research, gene sequencing also plays an important role in the field of clinical medicine, and has a profound impact on the development of the entire life science industry. In order to promote the healthy development of the gene sequencing industry, at present, MGI is building a stable and open industrial ecology based on the leading sequencing platform, independent research and development, and changing the inherent closed model of the industry.

In July 2018, MGI launched the first Sequencer User program in China to assist enterprises and scientific research institutions in the industry that need sequencing data output to realize the construction of independent sequencing platforms, providing comprehensive coverage including reagents, training and application guidance, as well as technical support to encourage genomics technology innovation and industrial development. The plan has achieved a positive response in China, and nearly 10 genetic industry institutions have become the ecological partners of this alliance. Beyond the Chinese market, BGI has launched a Global Sequencer User program in major markets around the world, including Europe and Asia Pacific. It has expressed its own unique voice in the global genetic sequencing market.

Looking Ahead

As the only company in China and one of only three companies in the world that can independently develop and mass produce clinical high-throughput gene sequencers, MGI’s completion of its first round of financing shows the recognition of its research and development capabilities and internationalization capabilities, which will help China in the life sciences and industrial high-end equipment manufacturing to achieve a leap from tracking to leading. For this first financing round, MGI will further strengthen the research and development and production of new gene sequencers, create a comprehensive product layout around digitalization of life, and commit to market development and ecological construction of the gene sequencing industry.

In the future gene sequencing market, we expect to see more and more Chinese gene sequencing technologies and products. At the same time, in an open and win-win industrial ecosystem, China's genetic industry will help the company to enter the global market faster through collaborative innovation, and accelerate the development stage from participating integrating, and matching to leading.

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