Can Scottish support help Inverness Medical Innovations beat the odds on at-home diagnostics?
The Waltham, Mass. diagnostic and nutritional supplement company will receive $57 million from Scottish government-funded ITI Life Sciences to develop a new diagnostic platform for use in human-health tests. The company also plans to spend $129 million of its own money to research, develop, manufacture, and commercialize the tests, with an initial focus on near-patient and in-home cardiology diagnostics, Inverness said this week.
Inverness hopes to first put its products in the hands of clinicians worldwide, and to later develop tests for use by patients themselves, the company said. The near-patient, or in-hospital, test may help stratify patients in the emergency room by risk of acute coronary syndrome, while an at-home test may help people with heart-attack symptoms decide whether an emergency room visit is necessary.
But can Inverness, which manufactures home pregnancy, ovulation, and blood-glucose monitoring, use its expertise, some Scottish cash, and recent acquisitions to tackle the at-home diagnostic market? Unlike the track record for near-patient testing, which ITI estimates to be $3.3 billion worldwide, few at-home tests have gained traction in the market so far.
To be sure, the track record of its predecessors is less than inspiring. "There have been a lot of [at-home] diagnostic attempts out there, but the only things that have really been that successful have been pregnancy tests, blood-glucose monitoring, and HIV and other types of tests," said Tracy Lefteroff, who, as global managing partner at PriceWaterhouseCoopers, has helped many drug makers and tool providers pen alliances and mergers and acquisitions. "But for other serious diseases, we haven't seen a lot of traction in point-of-care diagnostics, quite frankly."
Not only is it difficult to succeed in the at-home testing market, merely reaching the marketplace is a significant hurdle, said Lefteroff. Many venture capitalists have tried to fund companies with these tests in mind, but "it's too difficult [and], it takes too much money" to market to consumers, so "most of the people we've seen try to shy away from that," Lefteroff told Pharmacogenomics Reporter. At PWC, Lefteroff oversaw the company's massive private-equity practice.
Inverness, located in Waltham, Mass., might have an edge with earlier successes, and it believes its support from ITI Life Sciences can make a difference. ITI provides funding and planning to attract economic activity to Scotland, acting as something more than a business incubator, said Paul Heaney, the organization's director of technology and markets. As part of its agreement with ITI, Inverness will establish a wholly owned subsidiary, Stirling Medical Innovations, in Stirling, Scotland, which will "hopefully" open in the spring of 2006, eventually employing approximately 500 people, said Doug Guarino, Inverness director of corporate communications.
Inverness will have the right to develop medical products from the collaboration, while ITI will be free to pursue non-medical uses, such as bio-defense, veterinary care, environmental monitoring, and food testing, ITI said this week. Asked when he expects products to come out of the research effort, Guarino said that "on a best case, we would hope for 2007." He was unwilling to say whether a cardiovascular product would directly compete with a product already on the market.
As far as distribution goes, "We have a worldwide distribution network in place" through Inverness' network of laboratories, Guarino said.
Inverness is also tight-lipped about its upcoming products. "We haven't given any specifics on product[s]," and the company will not disclose any details about the tests' targets or technology until later this year "at the earliest," said Guarino.
A Window on Inverness?
If Inverness' recent activities are any indication, the new near-patient and at-home diagnostics will include tests using immunohistochemical and clinical-chemistry assays to detect biomarkers linked to myocardial infarction in blood from patients stratified in the clinic. The company may also include immunochromatographic and other immunoassay methods to detect viral and bacterial pathogens, should it follow the path cut by its acquisitions but the company has made no indication one way or another as to what technologies the new products will utilize.
Last month, Inverness said it would acquire Denver-based Ischemia Technologies. Ischemia sells an FDA-approved and reimbursable cobalt-binding test to detect ischemia-modified albumin, which emergency room doctors use to verify whether a patient has had a heart attack, said Robin Day, an Ischemia spokesperson.
"There are plans, at some point, to develop an immunoassay" to detect ischemia-modified albumin, said Day. "That would likely be undertaken by Inverness," she said. When combined with ECG data and troponin marker information, the cobalt-binding test is used by emergency room staff to separate patients likely to have an acute coronary syndrome from those with low risk, who are in turn put onto a fast track to early discharge, she said. "Typically, about 5 to 10 percent of patients are considered candidates for early discharge" within eight hours, but using this combination of tests, that number is raised to "about 33 percent," Day added.
Out-patient charges for chest-pain hospital visits are typically about $1,000, while in-patient charges can run from $2,500 to $10,000, said Day. The test can save money and hospital bed space, she said. Around 5.8 million patients per year present to hospitals with chest pain symptoms, Day said, citing figures from he US Center for Health Statistics. Emergency medical literature adds another 2 million patients per year who arrive with "chest-pain equivalent" symptoms, she said. The tests sell for $30; Ischemia had about $1 million in sales last year, Day said. Since January, Medicare has been reimbursing the tests at $47.42 each, she added.
One of the reasons Inverness is interested in the ischemia-modified albumin test is to move it into the home, to be used by people with chest pains who "aren't sure whether to push the panic button," said Day. Ischemia-modified albumin is among the markers that Inverness is interested in applying to a diagnostic, and "there are probably about six different points in cardiac disease you want to monitor," she said.
But the at-home tests Inverness is pursuing and which ITI may develop for bio-defense and other uses must likely be small enough and easy enough to use to adapt to home use or portability. Another company Inverness said in February that it had agreed to acquire, Portland, Ore.-based Binax, has such a line of tests. The immunochromatographic and enzyme immunoassays Binax sells detect pathogens, such as HIV, influenza, Legionella, and malaria, and can be used in the laboratory or the field, according to Binax's website.
Inverness spokesperson Guarino said that ITI would use essentially the same technology as that developed for an Inverness cardiovascular kit, for any future non-medical ITI applications.
Inverness also acquired Abbott Laboratories' rapid-diagnostics business in September, 2003, and may be interested in adapting that division's immunoassay-based pathogen-detection technology to its at-home diagnostics.