I own $TXG as of June 15th, 2020. This is part of a new series I’m starting studying publicly traded biotech companies. The below is my take and analysis, but all investing decisions are your own. Their latest annual report and investor presentation are downloadable here.
10x Genomics is a provider of hardware and software tools for “academia, governments, other biopharma and biotech companies.” TXG’s products help these institutions research scientific solutions for a wide range of fields, including cancer, neuroscience, drug development, and beyond.
The 10x products have resulted in scientific acclaim (having helped their customers get 700-plus papers published in major science journals by using 10x tools) and patent defensibility (over 200 currently owned or exclusively licensed with another 480 pending).
Before explaining their solutions, the challenges these customers faced before 10x Genomics include (from page 5 of the TXG annual report):
- Average, or bulk, measurements obscure underlying differences between different biological units, such as individual cells
- Low throughput prevents requisite sampling of the underlying complexity–for example, when only a few hundred cells can be evaluated at a time.
- Limited number of biological analytes are interrogated, giving a myopic view of only a few biological processes….
- Inefficient use of sample to generate a signal of sufficient strength to analyze the biological molecules of interest
- Inadequate bioinformatics and software tools
In plainer English, even with modern advances, scientists still run into limitations in their ability to analyze, faster and in larger volumes, the smallest “biological units” like cells and their molecules.
How does 10x solve this problem?