The Ultima Genomics/Olink BioBank Deal
Ultima have announced that they’ve been selected to be used as the vendor for a proteomics study by the UK Biobank. In total 700,000 samples will be run through the Olink Explore HT assay and sequenced.
The problem for Ultima is that this will still likely only result in about $10M to $20M in revenue for them. Sucks to be in a race to the bottom I guess.
gbub42 ran the numbers over on the Discord, which resulted in 4072 runs for Ultima and about $110M in kit costs for Olink. gdub42 has much better numbers than me, but based on Illumina/Olink documentation for the Olink 3072 kits this makes sense to me. With those kits you could do 384 samples on a 10B read run. And the Explore HT looks at ~2x the proteins, so it would make sense that 144 samples (UPDATE: I’ve been told Explore HT is 172 samples/run so this number is used below) would fit on a Ultima 8B run. Assuming $20001 per run, 4 UG100s at $1.5M this gives us:
(((2000*(700000/172))/1000000)+1.5*4)=$14.13M
This goes down to $10M if they just run a single UG100, and take their time… Larger projects of course tend to get discounts, but seems like we’re looking at $10M to $20M for Ultima. And probably a fraction of the revenue that Olink/Thermo will be banking for this project.
This is obviously not bad news for Ultima. But it does indicate the scale that Ultima need work at the be viable… I’d assume Ultima have a baseline burn rate of at least $100M/yr. That’s pretty typical for these kinds of companies… so just to cover their burn (and assuming 100% profit margins) they need 10 of these large projects to sustain themselves.
What it does show though is that Ultima’s strategy can win in some scenarios. They just need to drive enough volume… and in the current “macro-economic environment” that may be no easy task…
