It seems that Illumina (ILMN -2.96%) is making a push into the cancer diagnostics space. According to an article published Wednesday by Reuters citing "people familiar with the matter," the gene-sequencing specialist is in discussions to purchase Grail -- an early-stage company active in the segment.

While privately held, Grail would make a pricey target. According to Reuters' sources, after several funding rounds, it's valued at around $6 billion.

Cancer attacking an organism.

Image source: Getty Images.

The two companies are related. Illumina founded Grail as a stand-alone entity in 2016, and still holds a nearly 15% stake in it. It was not immediately clear whether Illumina was seeking to buy the remainder of Grail outright, or just purchase a majority stake.

Neither company has officially commented yet on the article.

Grail's ambition is to be a leader in the early detection of cancer, allowing doctors to catch malignancies while they can be more easily treated and ideally, eliminated entirely. It has no products on the market yet. The diagnostic test it has in development, called Galleri, aims to detect several types of cancer; it's currently in clinical testing.

Illumina has not been shy when it comes to shopping around for large new assets to acquire. In 2018, it struck a deal to buy Pacific Biosciences, which at $1.2 billion valued the target at a rich premium. That arrangement, however, was abandoned by mutual agreement in January.

Perhaps with that misadventure in mind, not to mention Grail's apparently high price tag, traders sent Illumina stock down by nearly 8.5% on Wednesday -- a much steeper slide than the modest 0.5% decline of the S&P 500 index.