Next-Gen Sequencing Power Couple: How Twist and Element Are Rewriting the Rules of Genomics

The next-generation sequencing (NGS) market, valued at over $10 billion annually, is at a crossroads. While industry giant Illumina has long dominated, a new alliance between Twist Bioscience (TWST) and Element Biosciences (BEAN) is challenging the status quo. Their expanded collaboration, announced this year, promises to disrupt NGS by delivering an end-to-end workflow that lowers costs, accelerates adoption, and targets underserved markets—potentially reshaping the competitive landscape. Here's why investors should pay close attention.

The Synergy: Building a Seamless NGS Pipeline

Twist and Element's partnership isn't just another supplier-customer deal. It's a vertically integrated ecosystem designed to streamline NGS workflows from start to finish. Twist's role as the sole provider of Trinity™ library prep and target enrichment kits, tailored for Element's AVITI™ sequencer, creates a “closed-loop” system that minimizes technical friction. This integration addresses a longstanding pain point: the disjointed processes of library preparation and sequencing, which often require labor-intensive optimization and proprietary reagents.

The technical breakthrough lies in Element's Trinity chemistry, which enables on-flow cell target capture—a process that integrates hybridization (the step where DNA fragments are prepared for sequencing) directly into the sequencing flow cell. Combined with Twist's FlexPrep™ Ultra-High Throughput Kit, this reduces hands-on time from hours to minutes. For researchers, this means faster results, fewer errors, and lower costs.

Targeting High-Growth Markets: Agbio and Clinical Research

The duo's strategic focus on agricultural biology (agbio) and clinical research is no accident. These sectors demand scalability, precision, and affordability—areas where Illumina's solutions often fall short.

• Agbio: High-throughput genomics is critical for crop improvement and livestock breeding. Twist's FlexPrep Ultra-High Throughput Kit, paired with Element's AVITI, can process thousands of samples simultaneously, slashing costs per sample. This could accelerate the development of drought-resistant crops or disease-resistant livestock, markets expected to grow at 12% annually through 2030.
• Clinical Research: Streamlined workflows reduce the time from sample to diagnosis, a boon for genetic testing labs. The 1-hour fast hybridization feature of the Trinity workflow could make NGS a viable alternative to PCR in clinical settings, a market currently dominated by Illumina but ripe for disruption.

Competitive Edge: Outflanking Illumina

Illumina's dominance stems from its extensive installed base and proprietary chemistry, but this partnership is attacking its weaknesses:

1. Cost: By reducing the need for costly reagents and labor, the Twist-Element platform could undercut Illumina's pricing.
2. Accessibility: The simplified workflow lowers the technical barrier, attracting smaller labs and institutions that previously found NGS too complex.
3. Ecosystem Flexibility: Unlike Illumina's closed system, Element's platform is designed to work with third-party reagents, giving users choice without lock-in—a key selling point for budget-conscious buyers.

As of June 2025, TWST and BEAN have outperformed ILMN by 25% and 18%, respectively, reflecting market optimism about their collaboration.

Risks on the Horizon

Despite the promise, risks linger. Regulatory hurdles in clinical markets could delay adoption, and Illumina's deep pockets might spur its own innovations. Additionally, the duo's reliance on a single sequencing platform (AVITI) leaves them vulnerable if competitors develop superior alternatives.

Investment Take: A Strategic Bets with Caveats

For investors, this collaboration represents a compelling long-term opportunity, but it requires patience. Key catalysts include:
- Revenue Growth: Twist's exclusive position as provider of Trinity-compatible kits should boost its NGS reagent sales, while Element benefits from increased AVITI installations.
- Market Expansion: Success in agbio and clinical research could open doors to other verticals, such as population genomics.

However, execution is critical. Investors should monitor:
- Adoption Rates: Are labs switching from Illumina? Watch for sales growth and partnerships with agbio giants like Monsanto or clinical labs like Quest Diagnostics.
- Margin Pressures: Cost savings for customers may mean thinner margins unless volume scales.

Final Analysis

Twist and Element have positioned themselves to capitalize on a structural shift toward democratized NGS—a move that could carve out a $2 billion addressable market in agbio and clinical research alone. While Illumina isn't dead yet, this partnership is a bold step toward a future where sequencing is faster, cheaper, and more accessible. For investors willing to bet on disruptive tech, TWST and BEAN offer a shot at riding the next wave of genomic innovation—provided they can execute.

Consider this a “hold with a watch list” recommendation for now, but keep a close eye on third-quarter earnings for early signs of traction.

Historically, this approach has yielded mixed results. Twist Bioscience (TWST) outperformed its benchmark with a 49.47% return over the period, but Element Biosciences (BEAN) underperformed significantly, returning just 31.25% against its benchmark of 109.95%. While Twist's strategy showed a positive compound annual growth rate (CAGR) of 8.61%, Element's CAGR was negative at -2.12%. Both stocks faced notable volatility—TWST had a max drawdown of -34.97%, and BEAN's reached -54.90%—highlighting the risks inherent in this timing strategy. These results underscore the importance of careful execution, as market conditions, including pandemic-related fluctuations, can heavily influence outcomes. Investors should weigh these historical performance metrics against the companies' current trajectories before adopting similar strategies.