By Lisa Seachrist

Washington Editor

WASHINGTON — Sequenom raised $17.8 million in a private financing to develop DNA sequencing technology as a tool for diagnostics and drug development, forensics, animal husbandry and environmental testing.

The San Diego-based company, which has facilities in Hamburg, Germany, also inked a collaborative agreement with Bruker-Franzen Analytik GmbH to develop a mass spectrometer dedicated to Sequenom's DNA analysis system.

Under the terms of the Bruker-Franzen agreement, Bremen, Germany-based Bruker-Franzen will upgrade the hardware and software interfaces of its Reflex and BiFlex MALDI-TOF instruments so as to analyze Sequenom's SpectroChip functional microarrays in a high-speed format. These instruments will be marketed under a joint Bruker-Franzen/Sequenom label and will be designed to process Sequenom's SpectroChips exclusively.

"Our collaboration with Bruker-Franzen is only the beginning of a number of collaborations we hope to announce over the next few months," said Hubert Koster, founder, president and CEO of Sequenom.

In addition to the expected series of collaborations, the company is looking toward a public offering in the next year, he said.

In the meantime, Sequenom plans to use the private placement funding to augment its bioinformatics structure, set up automated processes for its DNA MassArray technology, and set up manufacturing for SpectroChips.

Sequenom's DNA MassArray technology, said Koster, could allow researchers to perform the large-scale sequencing needed to link genes to polygenic diseases accurately and efficiently.

"Our investors share our view that our proprietary technology will enable more efficient and accurate DNA analysis for biomedical and life science applications," he said.

Investors in the financing included Lombard Odier Zurich Ltd., of Switzerland, Dresdner Kleinwort Benson, of New York; and S.R. One Ltd., of Wayne, Pa.

Sequenom's technology combines high-fidelity enzymatic techniques with mass spectrometry and the SpectroChip to conduct DNA analysis. Unlike traditional gel separation and hybridization methods of genetic analysis, DNA MassArray relies on an unambiguous measure to analyze DNA — mass spectrometry.

"We do not have the problems of interactions between the DNA molecules with the gel matrix nor inaccurate fluorescence signals from DNA hybridization methods," Koster said. "Our accuracy is 100 times greater than that with a gel. Molecular weight is the same all over the world." *

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