Roche is talking to the research centers of three large universities about buying their gene sequencing technology, Der Sonntag newspaper reported, without citing its sources.

Roche walked away from its bid for Illumina last week after the U.S. firm's management rejected a sweetened offer, but some investors think the Swiss drugmaker may wait in the wings for a fresh opportunity to pounce.

Roche, the world's largest maker of cancer drugs, has been developing targeted therapies and Illumina's technology would help it to progress further in this field as gene sequencing can better identify which patients benefit from a given drug.

After dropping the offer, Chief Executive Severin Schwan said last week Roche would look for other ways to expand its leadership in the diagnostics business.

Der Sonntag quoted Roche Chairman Franz Humer as saying that the company is also working on two of its own gene sequencing projects, one of them along with IBM (IBM.N).

The paper said Humer also noted Roche has a good relationship with privately-held Oxford Nanopore, which has similar technology to market leader Illumina.

(Reporting by Emma Thomasson. Editing by Jane Merriman)

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