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DermTech Enters Agreement With Blue Cross Blue Shield of Texas for Skin Cancer Assay

This article has been updated from a previous version to include DermTech's share price in Friday afternoon trading on the Nasdaq.

NEW YORK ─ Skin cancer diagnostic company DermTech this week announced that it has inked a contract that makes its Pigmented Lesion Assay available to approximately 6 million Blue Cross Blue Shield of Texas (BCBSTX) members.

La Jolla, California-based DermTech said its Pigmented Lesion Assay for the early detection of melanoma is now available as an in-network option for BCBSTX's Blue Essential, Traditional Indemnity, and PPO/POS membership.

According to DermTech, studies have shown that the gene expression assay has a 99 percent negative predictive value.

The agreement with BCBSTX comes after two Blue Cross agreements in late 2020 and recent inclusion in National Comprehensive Cancer Network (NCCN) guidelines, Cowen analyst Doug Schenkel noted in a research note published on Thursday. Agreements with BCBS of Illinois made the assay available to about 7 million members and with Blue Shield of California to about 3.7 million members.

DermTech "is positioned for considerable progress on the commercial payor front in 2021, especially with recent validation studies," Schenkel added.

In September, the investment bank initiated coverage of DermTech with an Outperform rating.

Following the recent close of a $143.7 million public offering, DermTech is seeking to expand its direct-to-consumer and telemedicine operations by building out its digital marketing platform for its pigmented lesion assay.

In afternoon trading on the Nasdaq, shares of DermTech were up more than 12 percent to $74.81.