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Flatley Took Illumina From Startup to Star

Following a string of big news since the first of the year, San Diego’s Illumina Inc. announced a shakeup at headquarters — CEO Jay Flatley is stepping down.

He will be replaced by Francis deSouza, an executive Illumina hired from Symantec Corp. in 2013 and who has long been seen as Flatley’s heir apparent. Flatley will remain as executive chairman.

Flatley, 63, has served as chairman and chief executive of Illumina since 1999, when the company was little more than a tech startup with 30 employees and a few hundred thousand in annual revenue. Today, the company employs 4,300 people and generated $2.2 billion in revenue last year.

Flatley has been credited for much of that growth, pushing the company to achieve faster, cheaper, and more accurate technology than its competitors. Today, Illumina is the world’s largest maker of DNA sequencing machines — a technology that’s revolutionized the study of biology and the discovery of new medicines. But that title wasn’t uncontested.

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HiSeqX Success

Companies on the East Coast, notably 454 Life Sciences, developed fast and cheap DNA sequencing before Flatley. But when Illumina unveiled its HiSeqX in 2014, the company blew away its competition.

“Again and again, (Flatley) confounded competitors who thought their new, flashy ideas could catch up to Illumina’s sequencers,” wrote longtime biotech reporter Matthew Herper in a recent Forbes article. “Thanks largely to perfect execution, helped by an aggressive legal strategy, no one has. Illumina has a near stranglehold on most types of DNA sequencing.”

Illumina’s HiSeqX machine dramatically reduced the cost of sequencing from $100 million in 2001 (during the Human Genome Project) to $1,000 per genome today. With access to cheap, advanced tech, researchers now understand genetics in ways that were previously unimaginable. The technology is now used to help doctors choose the right treatments for cancer patients, among many other applications in science and medicine.

In 2012 under Flatley’s watch, Illumina successfully fended off a hostile $6.7 billion takeover bid by Roche Holding AG. Today, the company’s market capitalization is about $23.5 billion, making it the third-largest public company headquartered in San Diego after Qualcomm Inc. ($80 billion) and Sempra Energy ($24 billion).

According to an Illumina spokesperson, Flatley was ready to spend less time in the office and more time with his daughters before they leave for college. Flatley will transition out of the driver’s seat at Illumina in July, but he will continue serving as executive chairman of the board. He will focus on company strategy and expanding the use of DNA sequencing in medicine.

Taking the Reins

Flatley’s shoes will be feeling a little spacious on deSouza as he steps into the role of CEO. But Illumina’s board members, who unanimously approved his appointment, aren’t worried.

DeSouza, 45, has been serving as president of Illumina since 2013. He has been instrumental in guiding Illumina into clinical markets in recent years, a significant responsibility considering that 40 percent of the company’s revenue comes from clinical sequencing applications.

DeSouza has also executed multiple major initiatives during his short tenure, including launching the HiSeq 4000 and the recent introduction of MiniSeq.

“The time is right for Francis to become Illumina’s next president and CEO,” Flatley said in a statement. “Francis is an exceptional leader, with a demonstrated track record of leading large organizations and implementing complex growth strategies. I look forward to partnering with him in his new role to continue the company’s strong legacy of innovation and execution.”

DeSouza’s Resume

Before Illumina, deSouza served as president of products and services at Symantec Corp., having joined the computer-security company via the acquisition of IMlogic, where he was co-founder and CEO.

Prior to joining IMlogic, he led the team responsible for the development of Microsoft’s enterprise real-time collaboration offerings. DeSouza was also co-founder and CEO of Flash

Communications, a provider of corporate instant messaging, which was acquired by Microsoft.

DeSouza will assume additional leadership responsibility for the general administrative and research arms of the business.

The leadership shakeup at Illumina follows a busy start to the year. The company has announced a string of developments since January, including multiple collaborations, a new product launch (MiniSeq), and the Grail spinout, a cancer detection company backed by a $100 million Series A round and led by ex-Google executive Jeffrey Huber. It’s indeed an exciting time to take the helm.

“I joined Illumina because I believe in the enormous potential of our mission to improve human health by unlocking the power of the genome,” deSouza said. “Today, having witnessed the impact our technology has on patients’ lives, and having experienced the passion and dedication of our employees, I could not be more honored, or more confident in our future.”

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