NEW YORK (GenomeWeb News) – DeCode Genetics has entered into a partnership with a laboratory services firm that may help it circumvent regulations in several states that have barred unlicensed firms from selling genetic tests, company officials said last week.
“We have established a relationship with a commercial laboratory in New York, who is working through the validation of our test,” Clyde Shores, DeCode’s VP of diagnostic marketing and sales, told investors during the company’s annual research and development update last week.
The firm, Lenetix, has licenses in New York, California, and Maryland, “and if we sublicense our testing to them, then they would be able to begin marketing our tests to each of those states,” Shores said.
In the recent regulatory battle between California state health officials and direct-to-consumer personal genomics companies, DeCode Genetics has tried to set itself apart from competitors by claiming that it does not market its DeCodeMe personal genomics service to the general public and is awaiting a state license before offering its tests in the state.
In fact, as reported by GenomeWeb Daily News sister publication Pharmacogenomics Reporter, the company has stated that it is not offering DeCodeMe services to residents of New York and Maryland, where it also does not have a license.
It appears that the partnership with Lenetix may allow the company to sell its tests in these states while it awaits the appropriate licensing, or potentially, in case it does not receive a license at all.
“This is a strategy to expedite the commercialization of our tests in each of those states in the case that we don’t receive state approval sooner,” Shores said.
DeCode Chief Scientific Officer Jeffrey Gulcher had earlier criticized competitors Navigenics and 23andMe for trying to claim compliance with state laws by outsourcing the genotyping for their services to state-licensed clinical laboratories.
“Regarding the California state license for diagnostics, it is important to point out that we do our own genotyping internally and therefore have not assumed, as some others have, that subcontracting to a licensed laboratory for the genotyping automatically achieves compliance,” DeCode co-founder Jeff Gulcher told Pharmacogenomics Reporter previously.
Gulcher was referring to Navigenics’ and 23andMe’s response to the California Department of Public Health’s warning letters for allegedly marketing genetic tests without a state license and directly to consumers. DeCode, Navigenics, 23andMe were among 13 companies to receive cease-and-desist letter from CDPH.
23andMe claims compliance with California’s laws, citing the fact that Illumina, the company that performs the genotyping for its service, is licensed in the state. Furthermore, the company says it employs a California-licensed physician to order the tests.
Navigenics has also maintained that it is in compliance because the genome scans that are part of its service are performed by Affymetrix, which is CLIA-certified in California, and the tests are ordered and reviewed by a California-licensed physician. Navigenics also said it encourages its customers to use its genetic counselors to better understand the test results.
Although the DeCodeMe service uses the Illumina 1M beadchip to analyze consumers’ DNA, the company has tried to set itself apart from competitors by the fact that it conducts its own genotyping.
“In many ways, 23andMe and Navigenics are only marketing organizations, somewhat akin to the dotcom companies, because they don’t do their own genotyping; they don’t control the quality of what they do,” Decode CEO Kari Stefansson said during last week’s R&D presentation.
“At DeCode, and for DeCodeMe, we do all the genotyping ourselves. … We are responsible for the quality of the tests, which ultimately makes us responsible for our reputation as a diagnostics company,” he said.
While Navigenics and 23andMe have continued to market their tests in California despite CDPH’s warning letters, DeCode has denied that it markets its products in the state. Furthermore, DeCode maintains that once it receives the appropriate licensing, it will only market its tests to doctors.
There is no reason to assume that even if DeCode provides its tests through Lenetix that will change its plan to only market to physicians in these states.
On its website, Lenetix describes itself as an “international laboratory resource providing rapid genetic screening and diagnostic testing for healthcare providers such as obstetricians, gynecologists, family practitioners, nurse midwives, laboratories and diagnostic facilities worldwide including their patients.”