Biotechnology And The Development of the Biochip Industry
Biotechnology took a dramatic turn In the 1980’s following the invention of the DNA sequencing approach in 19080 and the discovery of polymerase chain reaction (PCR) in 1983. Biochips emerged as a novel micro technology platform for analysis of bio-molecules. This has culminated in a lively biochip industry with biotechnology company Amersham at the forefront. The technologies involve a range of disciplines such as life sciences, information technology, microelectronics, and micro mechanics. Being of high throughput, miniaturized, automated and cost-effective features, biochips are regarded as important potential tools in modern life science research, medical diagnosis, drug discovery, food safety monitoring and agriculture. Biochips are considered to be able to markedly increase the speed and scope of analytical process and provide vast economic value. Therefore, many governments and industrial companies in the world have heavily invested in biotechnology, including the new field of proteomics, in recent years.
A biochip is not a single product, but rather a family of products that form a technology platform. Many developments over the past few years have contributed to its evolution. The very concept of a biochip was made possible by the work of Fred Sanger and Walter Gilbert, who were awarded a Nobel Prize in 1980 for their pioneering DNA sequencing approach that is widely used today. DNA sequencing chemistry in combination with electric current, as well as micropore agarose gels, laid the foundation for considering miniaturizing molecular assays.
Another Nobel-prize winning discovery, Kary Mullis’s polymerase chain reaction (PCR), first described in 1983, led to further development by allowing researchers to amplify minute amounts of DNA to quantities where it could be detected by standard laboratory methods. A further refinement was provided by Leroy Hood’s 1986 method for fluorescence-based DNA sequencing, which facilitated the automation of reading DNA sequence.
The US biochip industry is in a growth stage, characterized by rapid technological changes, improving profitability and a stabilizing competitive structure. Product development is very research intensive, with sales and marketing activities being very service intensive. Similar to trends in most life science businesses including the broader biotechnology field, biochip products and processes are subject to frequent and intense patent disputes, most of which involve living matter such as DNA and micro-organisms.
The demand for biochip products in US reached US$596 million in 2007, with a very high growth rate of 70% since 1998, according to The Freedonia Group, Inc. This growth can be attributed to the Human Genome Project.
To begin with, the biochip industry had its prime focus on the development of complete systems for detecting gene expression patterns and gene variants. As of now, commercialization efforts have been expanded to include consumables, instruments and software for protein analysis.
Biochips demand, the largest product segment in 2007, totaled US$287 million, a growth rate of 86.3% in the 1998-2007 period. About 87% of the segment is comprised of DNA chips that hold up to several thousand reference DNA fragments known as probes.
Demand for biochip instrumentation totaled US$140 million in 2007, based on yearly gains of 53.4% from 1998. Products include detection, production, sample preparation and hybrid instruments.
Demand for biochip reagents and consumables totaled US$123 million in 2007 based on per annum growth of 71.5% in the 1998-2007 period.
Biochip software demand totaled US$46 million in 2007, and annual growth was 59.9% between 1998 and 2003. Most biochip software consists of closed programs that function exclusively with the proprietary instruments and systems of one manufacturer.
Competition within the US biochip industry is consolidating into three major application segments. The first segment, gene expression analysis, is dominated by Affymetrix. The genetic variant segment, which identifies and types single nucleotide polymorphisms and gene mutations, is led by Amersham Biosciences and Affymetrix. Lastly, the new field of proteomics is highly fragmented, with many of the leading companies sharing the market.
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