The Only Future For Illumina...
A close partnership with the U.S. government is essential for the company's survival.
Listen up: it’s time to requisition Illumina, the largest genomics company on the planet. You’ll be hearting that term a lot “requisition.” It’s how the state turns adrift companies into serving the national interest at a time of grave conflict. We need Corporate America to be a little less treasonous.
Last week brought news that the European Union was issuing its largest ever fine for Illumina’s decision to close the GRAIL with permission. The fine amounts to something like $400m! Alas there’s no sign that Illumina gets how to turn the ship around.
Illumina is compromised and no amount of cost costing your way to growth will get it to its former glory — though I, too, was wondering what exactly was going on with that commercial real estate binge. Did they really need a Bay Area office?
Take the hint that the intelligence community has been giving you: America wants Illumina cleaned up and put into service. Get to it.
It won’t be easy to get Illumina up to shape. The trust that Illumina needs was already eroded when it emerged that it had a cavalier attitude toward cybersecurity. You can’t be running people’s sequences if you’re not safeguarding their DNA.
I wish I were surprised. After all Illumina’s approach seems to be this — cheat on cybersecurity, cheat on the investors, cheat on your spouse? From what we’re told this infidelity extends to the current CEO (and former general counsel) Chuck Dadswell who purportedly had an affair with a subordinate. Naughty stuff but not surprising. The since departed CEO set the tone with his own affair with an underling. These personal failings are a distraction from what needs to happen.
The investors want Jay Flatley to return. The employees want Jay Flatley to return. And, if you listen closely, the U.S. intelligence community want Jay Flatley to return. And it’s easy to see why. Flatley grew the company from low millions in revenue to billions. Flatley was crucially important to the building of the U.K. Biobank and Genomics England. Once upon a time he even did advanced weapons research for Uncle Sam.
There have been a number of bad faith efforts to impugn Flatley’s character — always done anonymously naturally — that Flatley was the puppet-master, pulling the strings of the activist nonagenarian billionaire. Hilarious though it is to imagine the genteel Flatley telling the pugnacious Icahn anything, let me be crystal clear: Flatley had nothing to do with the Carl Icahn activist campaign. I know because I begged him to lend his voice to it. He refused. Frankly he should have been forthright and loud about all that was going wrong at Illumina but he didn’t want to harm the company.
Icahn’s gambit to improve Illumina suited U.S. intelligence interests just fine — and made Icahn a target of the Israelis. In fact Illumina’s board would do well to understand that there are big forces at play and that those forces are amassing from the Beltway and London. Shockingly few people on the board have real security experience. Why is that? Could it be because they are the Washington Generals — designed to lose to
The board needs to take its responsibilities seriously too and move quickly to restore Flatley. Nothing less than Illumina’s legacy and the board’s reputation is at play here. By refusing to take seriously its obligations questions should rightly be raised about how compromised the board is, too. Indeed much of the board was hand selected by the compromised, now departed CEO! In my estimation the board is that it is far too enthralled by Big Pharma to be helpful. No! Growth will come from government, not from weird pharma plays.
There are willing partners who are sitting on the sideline hoping that Illumina gets it together. These include some of the largest sovereign wealth funds on the planet and some of the best data analysis firms who want nothing more than to trust Illumina. They won’t wait forever.
For many years Illumina has pretended to be a hardware company but truthfully Illumina is a data company — and America and her allies increasingly need genomic data to make complex decisions involving national health, law and order, immigration, and biosurveillance, to name but a few areas.
Our largest peer competitor — China — shows no squeamishness about building a biometric profile of its citizens and indeed the whole world. They’ve been fast at work stealing DNA when and where they can. My friend Jordan Bloom lays it out in more detail than we should here but it’s ghoulish stuff.
Whether we like it or not, we, too, will be forced into the great DNA collection race and we will have a series of choices to make.
I’ll be rolling out what such a vision might look like early next week.