Oxford Nanopore Soars on London Market Debut

Oxford Nanopore exceeded expectations for its long-awaited debut on the London Stock Exchange (LSE), with shares rising as much as 47% on the first day last week. Shares from the genomics sequencing startup were offered at 425 pence ($5.78) apiece. It quickly jumped to 612.53 pence before closing the day at 612.60 pence ($8.33), a 44% increase.

Nanopore sold £524 million of shares in the IPO and issued 82.4m new shares, raising £350m, while existing shareholders sold 41m shares, worth around £174 million. At the end of the day, the company’s market capitalization rose to around £4.8 billion ($6.53 billion).

Competitors in Illumina and PacBio

Following its spectacular market debut, Oxford Nanopore will have to justify its valuation in competition with American companies Illumina and Pacific Biosciences (PacBio), two established players in the field.

Illumina has long been credited with bringing down the cost of sequencing from $1 million per human genome in 2007 to $1000 in 2014. The company mostly offers short reads through sequencing by synthesis (SBS).

PacBio’s platform performs longer reads using its Single-Molecule, Real-Time (SMRT) sequencing. The company came close to an acquisition by Illumina for around $1.2 billion in 2018.

Oxford Nanopore’s technology sequences longer reads at a shorter time compared to its rivals. However, it produces more errors compared to the SBS used by Illumina, with an error rate of around 1% compared to 0.01% with SBS.

On top of that, Oxford Nanopore costs around $10-20 to sequence a billion DNA bases, compared to Illumina, which could sequence the same amount for $6. Oxford Nanopore would have to bring these shortcomings in line in the coming years or could face the ire of investors.

Author

Joy Lin

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