The Group’s operations comprise four core business units:
- Healthcare Diagnostics
- Stability Storage
The Healthcare Diagnostics business unit provides a complete histopathology and clinical diagnostics service for the sectioning, processing, staining and analysis of tissue samples on self-prepared and pre-prepared slides. The Group operates ISO15189 accredited medical laboratories and has built a significant and growing network of specialist consultant pathologists, all registered with the Royal College of Pathologists and General Medical Council. All Healthcare Diagnostics activities are undertaken at the Group’s head office and principal facility in Nottingham, UK.
The largest revenue stream within Healthcare Diagnostics comes from cellular pathology, which involves the examination of patient tissue. SourceBio acts as an outsourced partner providing cellular pathology testing to over 130 NHS Trusts and private healthcare providers. Demand for these services is driven primarily by the internal capacity constraints of public hospitals. Within the NHS, there is a shortage of pathologists contributing to increasing diagnosis waiting times and consequently driving demand for outsourced services. Whilst previously acting as an “overflow” for a constrained NHS, the Directors believe that SourceBio has transitioned its relationship with clients from an outsourcer to a business partner.
Cellular pathology testing is split in to two distinct services:
- “Wets” – SourceBio receives physical biopsies directly from the operating theatre, and uses its highly trained staff to complete the laboratory process of cut up, staining, and placing of the sample onto a wax block for slicing into thin wafers to be placed on a pre-prepared glass slide, which is then sent to a consultant pathologist for reporting and diagnosis; and
- “Pre-prepared” – SourceBio receives slides which already contain tissue samples that have been processed at a healthcare provider’s own laboratory. SourceBio then enters them in to a LIMS, before sending these slides to subcontracted pathologists who work remotely, with individual cases being sent to specific consultant pathologists according to their specialism.
SourceBio is one of a few commercial laboratory companies which is able to offer an enhanced service for Molecular Diagnostics tests to further investigate the sample on more complex cases. These services are known as Reference Laboratory Services, which can be categorised as:
- Molecular Diagnostics – Taking cancer samples for additional testing to determine the extent and complexity of the cancer. This type of testing is available for most cancer types and provides significant information for the clinician to make a decision on a patient’s treatment plan; and
- Personalised Medicine – SourceBio leverages its in-house expertise to partner with clinical diagnostics companies. Such companies look to utilise the increasingly abundant data generated by the Company’s NGS genomics equipment to provide screening assays to allow the early detection of diseases and the ability to better understand the genomic make up of a patient and their potential response to certain treatments before they are prescribed. This can allow better management and improved cost savings for all healthcare providers.
The Company is in the process of validating a Philips Digital Pathology system which will allow the transmission of electronic images of samples (rather than physical slides) leading to expected cost savings on carriage, and increased throughput as a result of shorter turnaround times. Whilst physical transmission of samples would always be expected for complex samples, the Philips Digital Pathology system incorporates Artificial Intelligence capabilities, which are expected to streamline the processing of more straightforward cases. In addition, it is expected that the introduction of Digital Pathology will allow additional public and private hospitals to use SourceBio’s services, whilst enabling SourceBio to increase its pool of consultant pathologists by including those suitably qualified (and registered with the Royal College of Pathologists) based overseas, who are currently out of reach due to the physical constraints of transporting slides.
Genomics is the study of genes to help progress research and clinical discovery for the pharmaceutical and healthcare industries. The Genomics business unit provides two DNA sequencing methodologies, Sanger Sequencing and NGS, both of which are now carried out principally at the Cambridge Centre of Excellence and also at the Group’s newly opened facility in Dublin, Ireland and its recently relocated and expanded facility in San Diego, USA.
Sanger Sequencing was developed in the 1970s and, whilst other sequencing methods have since been developed, remains highly popular and it is still the industry-adopted “gold standard” due to its effectiveness in targeting relatively small fragments of DNA, and its suitability for routine early phase research experiments. Sanger Sequencing is a basic procedure and can only sequence a single strand of DNA at a time. The technique is not widely taught in universities due to its basic nature, with the academic focus being geared towards analysis of the data that is generated. The provision of Sanger Sequencing is therefore largely outsourced, allowing clients’ research departments to focus on the analysis of the sequencing results.
NGS allows the sequencing of millions of DNA strands at once, rather than a single strand. This technology has dramatically accelerated the advancement of sequencing and has led to the ability to sequence whole genomes and therefore match individual genomes with disease traits, ultimately enhancing personalised medicine. NGS allows the ability to focus on small strands of DNA in high volumes to help enable deeper understanding of the effects on DNA from cancers and other diseases. NGS projects are typically larger but fewer in number, bespoke, more specialised, individually priced and of higher value than Sanger Sequencing projects. Clients initially utilising Sanger Sequencing will often progress to NGS services as their projects develop, presenting a cross-selling opportunity within the business unit. NGS projects are typically outsourced to SourceBio because clients are lacking either the latest equipment or staff who are trained to use the technology to create the required data response for their research. SourceBio’s team have the ability to run basic high volume tests as well as more complex higher value tests.
The Stability Storage business unit comprises two offerings: Stability Storage Services and Service and Validation primarily for the purpose of shelf life testing.
Within Stability Storage Services, SourceBio delivers outsourced temperature and humidity controlled environment storage services for stability trials at all ICH specified conditions as well as at bespoke conditions as required. Environmentally controlled Stability Storage is the gateway for a number of products to be released and to stay on the market. These products range from drug products, medical devices, consumer products and packaging. In addition, SourceBio offers photostability testing capabilities, biologic storage and contingency storage for customer disaster recovery purposes. SourceBio is well established in this market having been providing stability storage solutions for over 30 years through accredited facilities in Rochdale, UK. The Group has recently invested in additional capacity in the Tramore facility and relocated to a larger site in San Diego to support future growth.
The Group also provides Service and Validation services to established clients which have previously purchased and installed SourceBio equipment. These services comprise regular and periodic servicing and testing of installed storage equipment at customer premises to ensure adherence to relevant regulatory standards. The Company also provides a 24-hour call-out service for clients to rectify any issues with performance and to keep the equipment running at optimum levels of performance to meet the strict regulations under which clients’ high value products are stored.
Other non-core services
The Company offers additional services which it considers to be non-core to the business.
- Clones/Cloning – Cloning processes are used to produce genetically identical copies of a biological entity. The copied material (which will have the same genetic make-up as the original) is referred to as a clone. Researchers have cloned a wide range of biological materials, including genes, cells, tissues and even entire organisms. SourceBio provides a set of library clones for research purposes that replicate the DNA make-up of various organisms. With improvements in science, such as stem cell research, the use of clones is diminishing and less popular with research groups around the world; and
- Blood & Tissue Serological Products – SourceBio manufactures products used in blood services, transplantation, diagnostics and therapeutic research and clinical research. These products are mainly used for blood donation and transfusion, haematological disorders and stem cell donations. The business unit has a small customer base (predominantly NHS Blood & Transplant) and is not a core business focus.