SAN FRANCISCO (GenomeWeb News) – The 32nd Annual JP Morgan Healthcare Conference continued here Wednesday with presentations from several life science tools and diagnostic firms.
The following are capsules from the presentations and breakout sessions of Nanostring, Becton Dickinson, Bio-Rad, Cepheid, Quidel, GenMark, Pacific Biosciences, and Adaptive Biotechnologies. Coverage of Danaher's presentation, in which the company discussed its acquisition plans, is available here.
While placements of NanoString Technologies' nCounter platform were the primary driver of fourth quarter revenues, President and CEO Brad Gray said that the recent US launch of the company's Prosigna Breast Cancer Prognostic Gene Signature Assay will be the catalyst for growth in 2014.
Earlier this week, the company reported preliminary year-over-year revenue growth of 55 percent in the fourth quarter. Gray said that revenues for full-year 2013 are anticipated to be $31.4 million, which would be a 37 percent increase year over year from 2012.
In his presentation, Gray said that in the fourth quarter, the company focused on penetrating the research market with its nCounter system. As instrument placements rose, consumables revenue per instrument on average also increased to about $100,000 per year.
But with clearance of Prosigna in September by the US Food and Drug Administration, the continued commercialization of the test in the US is at the forefront of the company's roadmap for growth in the coming year, Gray said. Prosigna runs on the nCounter Dx Analysis System.
This week, that strategy got a boost when Laboratory Corporation of America said it would make the Prosigna assay available across the US.
Gray said the launch of the assay will be two-pronged. The first step will be commercialization of the test by labs such as LabCorp, as well as Arup Laboratories and Quest Diagnostics. NanoString has agreements covering Prosigna with all three labs.
Additionally, NanoString is targeting large hospitals and cancer centers with its own sales staff that it will hire in the second quarter. Initially, it plans on a staff of about 15 and will ramp that up depending on need, Gray said.
Such an approach, he said, has several advantages for NanoString. It provides access to physicians in the US through its clinical lab partners' sizeable sales forces, as well as access to third-party payors through the labs. In the meantime, NanoString would not be directly exposed to any reimbursement risk from third-party payors.
Along with adoption of Prosigna, NanoString is aiming for continued penetration of the nCounter Dx Analysis System into the clinical lab market.
On the reimbursement front, the firm has begun discussions with Medicare administrator Palmetto about getting reimbursement for Prosigna, and Gray said that Medicare coverage could come as early as the third quarter.
NanoString is developing a smaller benchtop version of the nCounter system. Gray declined to provide much detail about the system, but said that it will be consolidated into one box from the current two boxes, and will use the same chemistry as the original instrument. The price is currently anticipated to be in the range of $75,000 to $125,000.
CFO James Johnson said that 2014 will be a year of investments for the company with the rollout of the Prosigna test in the US, as well as an "intense" period of development on the new benchtop instrument. As a result, operational expenses will increase in the year.
On Wednesday, NanoString also announced an option from the Massachusetts General Hospital to license IP related to a method of protein analysis using the nCounter system.
For the 2013 fiscal year, Becton Dickinson returned to double-digit earnings growth for the first time since 2007, Chairman, President, and CEO Vincent Forlenza said, and for FY 2014, EPS is expected to be up between 9 and 10 percent.
One focus of the firm's growth strategy will be on R&D with a particular emphasis on moving away from spending on line extensions and toward development of new products. In FY 2013, the company launched 20 new products, Forlenza said, or twice as many as in FY 2012, and in the coming year, new products are anticipated to comprise between 15 percent and 16 percent of total revenues.
On M&A, he said the company will target tuck-in deals that "accelerate [a] move into adjacent opportunities."
Organic revenues are projected to increase 4 percent to 5 percent in FY 2014, Forlenza said.
Earlier this week, BD said that its BD Max MRSA XT assay for use on the BD Max system had been cleared by the US Food and Drug Administration.
About one-third of Bio-Rad's growth has historically resulted from acquisitions, and for 2014, the company's M&A strategy will remain focused on businesses to build Bio-Rad's market position or to move it into complementary areas, President and CEO Norman Schwartz said.
M&A and R&D are the company's main targets for use of cash, but on potential acquisitions, he said that everyone will just have to wait and see what develops.
If acquisitions and R&D are at the top of the list for cash use, dividends are far down, CFO Christine Tsingos said, as is stock buyback.
On the academic/government environment, Schwartz said that he senses there is "probably a little bit" of pent-up demand for instruments and other products among researchers, following a tough funding environment last year. While it still is early to hope for too much, "the atmosphere seems to be a little more positive than it has been," he said.
Cepheid CFO Andrew Miller said that by the end of 2014 the firm expects to have a total of 18 GeneXpert tests available in the US and 25 available in Europe, up from 14 in the US and 15 in Europe as of the end of 2013. Among the assays the firm expects to commercialize in the US this year are Xpert tests for trichomonas, norovirus, flu/RSV, and BCR/ABL v2.
He also mapped out Cepheid's plan to move beyond infectious diseases, its primary area of focus, and into virology. That expansion would increase Cepheid's addressable markets to $5.2 billion from its current $1.7 billion, said Miller.
Miller also said that in Cepheid's burgeoning High Burden Developing Program it expects to introduce a qualitative and quantitative HIV test this year.
Quidel President and CEO Doug Bryant provided an update on the firm's Savanna MDx molecular diagnostics platform. The system, which is a benchtop, sample-to-answer platform, is nearing its unveiling. Bryant said the first Savanna boxes are currently in production, and Quidel aims to debut the system at the annual American Association of Clinical Chemistry meeting in July. The company also plans to ship beta systems to South Africa in the fourth quarter of this year.
Quidel expects to conduct clinical trials on the system in the US next year, with a possible US clearance late in 2015, though Bryant said that timeline would be tight.
Bryant noted that Quidel submitted seven 510(k) applications for its molecular tests alone last year, including two for its handheld molecular platform called AmpliVue. The firm received FDA clearance for its AmpliVue Group B Strep assay just last week.
Along with the GBS assay, Quidel expects to commercialize a molecular C. difficile test this year and the AmpliVue HSV 1and 2 assay. In addition, it intends to submit three additional AmpliVue tests to FDA for clearance.
GenMark Diagnostics President and CEO Hany Massarany also provided an update on his firm's next-generation molecular diagnostics platform call NexGen. The fully digital, sample-to-answer system will complete development in the middle of this year. Massarany said the system will be launched in Europe this year with an IVD submission to the FDA expected early next year.
Massarany said the NexGen system could launch in the second half of 2015.
The initial focus of the system is on infectious diseases, with a menu first focused on respiratory viruses, hepatitis C, gastrointenstinal infections, and two assays for sepsis (gram positive and gram negative).
Ultimately, he said, the NexGen system will have a portfolio in the mid to high teens of multiplex panels.
PacBio CEO Mike Hunkapiller said that the company was on pace to double its bookings in 2013. Hunkapiller did not disclose a specific target for 2013, but the company booked 12 systems in 2012.
The firm will report its fourth quarter and FY 2013 results in early February, but in the meantime Hunkapiller said PacBio's installed base of RS systems was up 25 percent year over year. He added that the average consumables pull-through is now more than $100,000 per year, and its consumables revenue was up 75 percent.
Chad Robins, co-founder and CEO of Adaptive Biotechnologies, discussed new products that the firm plans to launch in the next several years.
Last year, it launched ClonoSeq, a clinical test for assessing minimal residual disease in blood-based cancers. In the second half of 2014, it plans to make its proprietary immune repertoire profiling technology, dubbed ImmuoSeq, into a research-use only kit.
Additionally, Robins said the firm is developing three other diagnostics.
It plans to launch its second clinical test, dubbed QuanTILfy, for solid tumors in the second quarter of 2015. QuanTILfy will assess tumor infiltrating lymphocytes and will initially be launched to allow physicians to more accurately stage patients based on the count and clonality of the patient's TILs. In the fourth quarter of 2015, the firm will launch QuanTILfy for a second indication, predicting response to immunotherapeutics. In the second quarter of 2016 it is planning an assay to monitor patients' immune system post-transplantation.
Earlier this week, Adaptive announced that it had signed an agreement with Janssen Research & Development to use its ImmunoSeq assay to study immune response to diseases in order to identify patients more likely to respond to immunology and oncology drugs being developed by Janssen.