NEW YORK – Bionano Genomics expects an uptick in the clinical adoption of its optical genome mapping (OGM) technology after the American Medical Association (AMA) assigned it a Category I Current Procedural Terminology (CPT) code earlier this week.
While Bionano considers the CPT code, expected to become effective at the beginning of 2025, "a game changer" for clinical OGM testing, it remains to be seen whether there will be a seismic shift in its routine clinical use given that details on pricing and insurance coverage are still up in the air.
"We have known for some time that a barrier to widespread use of optical genome mapping clinically has been a path to reimbursement," said Bionano CEO Erik Holmlin. "A Category I CPT code is a way of clearing that path."
Approved by the AMA editorial panel on Monday, the CPT code covers the use of OGM for genome-wide cytogenetic analysis to help detect structural and copy number variations in hematological malignancies.
The code applies to any clinical lab in the country that hopes to deploy OGM clinically for hematological malignancies, Holmlin said, including Bionano's clinical diagnostics service subsidiary, Bionano Laboratories, which has been offering the OGM-Dx HemeOne assay as a laboratory developed test (LDT).
Until now, Bionano customers needed to jump through the hoop of obtaining their own Proprietary Laboratory Analyses (PLA) code in order to seek insurance reimbursement for their clinical OGM tests. Praxis Genomics, for instance, has secured a reimbursement code for its OGM assay, receiving about $1,850 per test, as Bionano previously disclosed. The new Category I CPT code alleviates the burden for customers to do so, Holmlin said.
This wasn't the first time that OGM was brought before the AMA for consideration of a CPT code. Last year, Bionano submitted a CPT code application but subsequently withdrew it out of fear of receiving a Category III code, which is reserved for new and developing technologies, procedures, and services.
Holmlin said Bionano was not involved in the application this time around. Instead, MD Anderson Cancer Center, whose cytogenetics laboratory has already developed OGM into a clinical test for leukemia patients, took the lead.
With a Category I CPT code secured, Holmlin said the next step is for the Centers for Medicare and Medicaid Services to price the test later this year. It also remains to be seen whether private insurance companies will cover the test and how much they are willing to pay for it.
Even with an avenue for reimbursement available, clinical labs will still need to develop and validate their OGM assay as an LDT first, given that Bionano's products are currently designed for research use only.
Holmlin said developing an LDT should be "a very straightforward process," though he acknowledged some customers have been reluctant to do so. "People have not been willing to take the step to develop an LDT," he noted. "But now [that the CPT code] is out there, I think it lowers the barrier for them to make the investment."
It is unclear what implications the US Food and Drug Administration's final rule on LDTs will have on future or existing clinical Bionano customers. Holmlin believes that since many OGM users are hospital labs that plan to develop tests for analyzing patients within their institution, they will fall under the FDA rule's exemption category.
The company, for its part, has been improving the OGM technology in various ways, such as throughput and automation, to address some of the bottlenecks for its routine use.
According to Holmlin, the company's newest platform, the Stratys system, can deliver four times the throughput of the old Saphyr platform, promising to handle around 5,000 blood cancer samples per year. It remains to be seen how the platform, which formally launched in January, will perform in customers' hands. Bionano also declined to disclose how many Saphyr systems it has sold so far.
The company has also made several updates to its Via analysis software, enabling more streamlined data visualization, interpretation, and reporting. It also announced a software marketing agreement with Revvity this week, under which the firms will market Bionano's Via software to Revvity's next generation sequencing (NGS) customers as part of Revvity's newborn sequencing research workflow.
The approval of the Category I CPT code is encouraging news for Bionano, which has shown signs of financial distress this year. Last month, the company raised $17.9 million in debt financing after netting $10 million in April through a registered direct stock offering.
In March, Bionano announced a restructuring plan including the termination of more than 110 employees. Combined with layoffs announced in May and October of 2023, the company has reduced its headcount by approximately 200 people in total.
"There is a lot of pressure on companies like Bionano and others to extend their cash runway, which is why we have been reducing the size of the company," Holmlin said. "One of the reasons that we were laying people off was that we completed the development of many of our products."
He also noted that Bionano likely needs to raise additional capital in the future, which the approval of the Category I CPT code might facilitate.
"If we're not able to raise that additional capital, then we have to make the capital we have last longer, and that would mean that we would get smaller," Holmlin said. "We hope to be able to grow, but we also need to face the reality that further reductions may be required."