State-owned enterprises make up most of the market capitalisation of China’s stock markets and account for some of the country's largest companies, according to the Economist magazine. State capitalism has also been particularly good at producing national champions that can compete globally.
The BGI, formerly known as Beijing Genomics Institute, is a great example of this. It is by far the largest sequencing centre in the world, and it is busy expanding overseas. It is currently establishing subsidiaries in Copenhagen, Sacramento, and Philadelphia, and it has deals with companies and research centres around the world.
One reason for its success is that it can sequence more economically that others. This is probably due to economies of scale, but also because it benefits from government subsidies such as a $1.6bn line of credit from the China Development Bank.
The BGI dominates Chinese genomics. According to Omics Maps, there are 201 next generation sequencing machines in the country. 83 percent of those are owned by the BGI.
Which is not to say that there aren't any other genomics companies. Shanghai Biochip, also trading as Shanghai Bio Corporation, is one of them. It offers diagnostic products, research supplies, and research services that include DNA sequencing. Its English website also has a section on personal genetic testing, although this is still under construction.
A second example of a Chinese genomics company is Beijing Berry Genomics, which performs pre-natal diagnosis by sequencing. It is financed by Legend, a Chinese venture capital firm that is also a controlling shareholder of the computer manufacturer Lenovo. The company develops technology that can detect trisomy 21 and other chromosomal abnormalities in foetuses during pregnancy. It seems that it is using a sequencing-based method that is similar to that of market leader Sequenom.
Overall, there is plenty of government investment in genomics and in particular in sequencing in China, and at least for the BGI, the investment seems to pay off for the time being. The ultimate test of this will however be whether the BGI will be able to pay back its $1.6bn loan when it is due in 2020.
On September 17th, the BGI agreed to buy the sequencing company Complete Genomics for $118, affirming its dominance of the sequencing services field.
Other countries, other genomics