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Exact Planning to Work With USPSTF to Change Recommendation on Cologuard

NEW YORK (GenomeWeb) – The US Preventive Services Task Force recently issued a draft update to its colorectal cancer screening guidelines in which it includes fecal DNA testing in an alternative category of strategies to be used in "select clinical circumstances."

The recommendation impacts Exact Sciences, which last year achieved simultaneous approval from the US Food and Drug Administration and the Centers for Medicare & Medicaid Services for its stool DNA-based colorectal cancer screening test, Cologuard. The firm had taken its tests through parallel review by FDA and CMS and conducted a large pivotal study involving 10,000 participations, called DeeP-C. In that study, Cologuard detected 92 percent of cancers and 69 percent of advanced precancerous polyps in average-risk patients.

The latest USPSTF draft language, which is an update to 2008 recommendations, "was different than what we and most people expected," Exact CEO Kevin Conroy said during a call with investors and analysts this morning.

Isaac Ro, a Goldman Sachs analyst, issued a note to investors stating that he viewed the draft language as a negative for Exact. He had anticipated an "A" or "B" rating for the test, which "would have paved a clear path for full reimbursement coverage from private insurance companies."

The USPSTF is accepting comments on the draft recommendations until Nov. 2, and during this time Exact will provide information to the task force that it hopes will change the recommendation more clearly in its favor.

The USPSTF is proposing colorectal cancer screening for people between the ages 50 and 75 years, and recommending annual screening with fecal immunohistochemical testing (FIT) or high-sensitivity guaiac fecal occult blood testing. Other recommended tests by the group are flexible sigmoidoscopy with FIT or colonoscopy every ten years.

In the 2008 version, the USPSTF specified screening with fecal occult blood testing, sigmoidoscopy, or colonoscopy, and gave fecal DNA testing an "I" rating, noting there was insufficient evidence on the tool. In the current update, Cologuard no longer has an "I" rating but is considered an alternative strategy.

"What you have here is a change framework for how tests are graded," Conroy told investors. Although the task force now lists fecal DNA testing as an alternative to standard approaches, it did not define the specific clinical circumstances in which it might be used.

"We believe this will be defined in practice," Conroy said, noting that many patients don't adhere to screening recommendations with more invasive procedures like colonoscopy.

In reviewing data on Cologuard, the task force found that when used annually the test had the biggest impact on mortality and life years gained for every 1,000 patients screened, Conroy noted. But the task force didn't like that fact that when compared with other stool-based screening tests and screening with colonoscopy every 10 years, Cologuard requires a more lifetime colonoscopies per life-year gained.

"Cologuard every three years was not considered by the task force," Conroy said. He highlighted data showing that Cologuard used every three years yields the same mortality and life years gained impact as FIT, and has a lower colonoscopy burden.

During the comment period, Exact plans to inform the task force of the additional evidence on its test and try to "modify its draft guidance to include Cologuard as one of the recommended screening strategies."

Conroy noted that Exact will continue to reach out to patients, doctors, and payors about the evidence supporting its screening test and its advantages over standard approaches.

Despite the "I" rating from USPSTF, more than 20,000 doctors have ordered at least one Cologuard test and the company boasts more than 100,000 total test orders. More than 30 healthcare systems have adopted the test and 20 payors representing 57 percent of the covered population have agreed to reimburse the test.

In a final payment decision last year, CMS agreed to price Cologuard at around $500 per test.

However, Goldman Sachs' Ro believes that the uncertainty with the USPSTF recommendation will impact test adoption and reimbursement. "We believe the stage is now set for a less compelling market adoption story as it is unclear if private payers will be required to cover Cologuard, whether Exact will be able to realize pricing consistent with Medicare rates, and what compliance within the Medicare population will look like," Ro wrote.

He also lowered his revenue estimates for the firm by 36 percent, on average, through Fiscal Year 2018. He also lowered his six-month price target on the stock to $11 from $24.

In Tuesday morning trade on the Nasdaq, shares of Exact Sciences plummeted 42 percent to $10.84.

Exact previously projected that if it were able to gain a 30 percent share of the colorectal cancer screening market that represents a $1.2 billion US commercial opportunity for Cologuard.