Pitfalls and opportunities for applying PEER factors in single-cell eQTL analyses

Using latent variables in gene expression data can help correct spurious correlations due to unobserved confounders and increase statistical power for expression Quantitative Trait Loci (eQTL) detection. Probabilistic Estimation of Expression Residuals (PEER) is a widely used statistical method that has been developed to remove unwanted variation and improve eQTL discovery power in bulk RNA-seq analysis. However, its performance has not been largely evaluated in single-cell eQTL data analysis, where it is becoming a commonly used technique. Potential challenges arise due to the structure of single-cell data, including sparsity, skewness, and mean-variance relationship. Here, we show by a series of analyses that this method requires additional quality control and data transformation steps on the pseudo-bulk matrix to obtain valid PEER factors. By using a population-scale single-cell cohort (OneK1K, N = 982), we found that generating PEER factors without further QC or transformation on the pseudo-bulk matrix could result in inferred factors that are highly correlated (Pearson’s correlation r = 0.626∼0.997). Similar spurious correlations were also found in PEER factors inferred from an independent dataset (induced pluripotent stem cells, N = 31). Optimization of the strategy for generating PEER factors and incorporating the improved PEER factors in the eQTL association model can identify 9.0∼23.1% more eQTLs or 1.7%∼13.3% more eGenes. Sensitivity analysis showed that the pattern of change between the number of eGenes detected and PEER factors fitted varied significantly for different cell types. In addition, using highly variable genes (e.g., top 2000) to generate PEER factors could achieve similar eGenes discovery power as using all genes but save considerable computational resources (∼6.2-fold faster). We provide diagnostic guidelines to improve the robustness and avoid potential pitfalls when generating PEER factors for single-cell eQTL association analyses.