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ExonHit, RedPath Deal Hits Snag as Medicare May Drop Coverage of Test

By a GenomeWeb staff reporter

NEW YORK (GenomeWeb News) – ExonHit Therapeutics today said that it has been informed by RedPath Integrated Pathology that Medicare may discontinue coverage for RedPath's molecular diagnostic test for pancreatic cancer.

On Wednesday, ExonHit was told by RedPath that CMS contractor Highmark Medicare Services announced its intention to drop coverage of PathFinderTG-Pancreatic cancer, depending on an assessment of the test.

In April, ExonHit announced plans to acquire RedPath in a deal valued at up to $32 million. ExonHit said today that it is evaluating the ramifications of possible discontinued coverage of RedPath's test on the deal.

A shareholder's meeting scheduled for June 28 to decide on the acquisition may be postponed, ExonHit said in a statement.

According to ExonHit, Highmark's intention is based on data from 2006. RedPath has until July 9 to respond to Highmark why coverage of the test should continue, and is currently gathering the most recent data on the test, which will be supported by key opinion leaders in the sector and recently published peer review scientific articles.

Highmark could then decide to continue coverage for PathFinderTG-Pancreatic cancer, or to drop coverage effective Sept. 29.

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