Originally published Sept. 21.
By Turna Ray
With more than 20 collaborations with drug companies now under its belt, Qiagen is steadily penetrating the companion diagnostics market.
Since acquiring the personalized medicine company DxS in September 2009, Qiagen has netted as many as five new collaborations with drug companies "to develop companion diagnostics for their blockbuster drugs," Qiagen CEO Peer Schatz said at an investor conference this week.
When it acquired DxS last year, Qiagen said that the combined firm had 15 collaborations with pharmaceutical partners for the development of companion diagnostics to personalize marketed or investigational drugs (PGx Reporter 09/23/09).
Schatz said this week at the UBS Global Life Sciences Conference in New York that the company now has 20 companion diagnostic partnerships and that "the drugs that are being associated with our diagnostic tests have market potential in existing sales in the multi-billions of dollars."
Qiagen, with more than $1 billion in net sales last year, believes it is "in a position to shape" the personalized medicine market, according to Schatz.
Just under half of the company's total revenues come from molecular diagnostic sales to hospitals and reference labs. Research collaborations and companion diagnostics development with pharma currently generate approximately 22 percent of the company's revenues, but this segment of the business is growing at a 11 percent clip, Schatz said. Sales to academic centers make up another 24 percent of Qiagen's revenues, while 7 percent of its revenues come from tests sold to entities doing research on animals, food, and forensics.
In addition, Qiagen is also eyeing the point-of-care testing market. With its acquisition of ESE in January, Qiagen gained access to a handheld molecular diagnostics platform. "It's still a bit of a wild card, but it's exciting," Schatz said with regard to the development of the point-of-care device. The test can be used to run Qiagen's molecular tests in the hospital setting, as well as conduct veterinary, food, environmental, and biodefense point-of-need testing. The platform, according to Schatz, costs "a few hundred dollars."
Pharma Partnerships
Despite Qiagen's varied portfolio, Schatz focused his UBS presentation on opportunities in the companion diagnostics space and the company's biomarker discovery efforts with pharmaceutical companies.
"We're far ahead of most … kit companies out there" in terms of forming Rx/Dx deals with pharma, Schatz claimed. "We have five or ten times as many partnerships as" competing companies in the space.
Indeed, Qiagen has had some big wins in this area. After the US Food and Drug Administration last year updated the labeling for two colorectal therapies, Amgen's Vectibix and Merck's Erbitux, to inform doctors that patients with KRAS mutations would not respond to these drugs, DxS formed deals with both of these sponsors to develop companion tests (PGx Reporter 07/22/09).
Qiagen has already launched these tests in Europe, but must garner FDA approval before selling them in the US. At the UBS meeting, Schatz said that Qiagen expects to complete its modular premarket approval submission for the TheraScreen KRAS companion test for Vectibix by year end and plans to launch the test kit by 2011.
Additionally, Schatz noted that Merck has penetrated more than 60 percent of the metastatic colorectal cancer market for Erbitux with the help of Qiagen's companion diagnostic. "This is almost as much [penetration as] Herceptin has after more than 13 years of being in the market," Schatz said. "And we did that in the last two years."
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Qiagen is also among several academic and commercial diagnostics entities providing companion EGFR mutation testing for AstraZeneca's non-small cell lung cancer drug Iressa (PGx Reporter 06/02/10).
Schatz said that Qiagen is strategically entering partnerships with drug developers as early as possible, preferably during the biomarker discovery phase, in order to improve its chances for netting more profitable deals for commercial development down the line.
"We're starting at the research phase, and through targeted panels of gene expression, methylation, genomic marker, and microRNA markers, we've created whole disease panels and pathway panels of over 100 assays that target specific types of diseases and pathways, and that ultimately allow pharma companies to get a funnel from which they can then select the biomarkers that they want to put into a diagnostic format," Schatz said.
Qiagen's work in biomarker discovery may be aided by its purchase of SABiosciences last year, through which it gained access to around 100 disease- and pathway-focused real-time PCR array panels. As reported in PGx Reporter sister publication BioInform, the company's strategic reason for acquiring SABiosciences and DxS,was to meet needs at both ends of “the pharmaceutical drug discovery and development pipelines.”
According to Schatz, all of Qiagen's products are IVD ready. "They are prepared for diagnostic use and we've made it a non-stop flight … from early discovery to post-launch companion diagnostics. This has been very well taken up by our pharmaceutical partners," he said.
Although "blue sky" discovery research is at risk for cost-cutting at big pharma, this segment of Qiagen's business has been growing at between 15 percent and 20 percent annually, according to the company.
Meanwhile, Schatz pointed out that 75 percent of R&D expenditures at drug companies are not in discovery but in development and Qiagen is "accessing this funding much more than [it has] in the past." The test development side comprises half of Qiagen's business from drug companies, and "we've been seeing very good uptake," Schatz added.
'Blockbuster' Platform
Earlier this month Qiagen announced the European launch of its QIAsymphony RGQ automated molecular testing system, which runs multiple laboratory-developed tests and commercial diagnostics. The platform features continuous loading, random access, and open channels that give users the flexibility to run a number of PCR kits for the detection of HIV, HCV, HBV, and a transplantation panel. The QIAsymphony RGQ can process multiple input formats and can assess up to 72 samples per run.
In the coming months, Qiagen plans to expand the platform's capacity to run its TheraScreen suite of tests for detection of EGFR and KRAS mutations, among other tests. The company also plans to eventually integrate the platform's detection options with pyrosequencing and multiplexing solutions.
At the meeting, Schatz described the platform as the first "real blockbuster" diagnostics platform with a market potential "north of $1 billion."
According to Schatz, the QIAsymphony RGQ platform addresses an important market for the company in Europe, as well as the US, where the company is planning to also launch the platform with FDA's blessing, though he did not provide a timeline for FDA approval of the system.
"Currently molecular testing is only performed in a small sub-segment of the market," Schatz said. "Only a few hundred hospitals out of the 7,000 hospitals in the US are performing molecular testing, and the consensus is that about 2,000 hospitals in some point in time over the next five years will look into this space."
Qiagen is hoping to capture this growing customer base with the QIAsymphony RGQ platform. "We've gotten fantastic reviews out of Europe. We're replicating that here in the US, with FDA trials and are trying to expand that to include more and more of these blockbuster tests," Schatz said at the meeting.