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Genomic Health's Suspension of NGS Liquid Biopsy Program Highlights Market Challenges

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NEW YORK (GenomeWeb) – Citing a shift in focus to prioritize the advancement of tests that are proprietary and/or have a clear reimbursement path, Genomic Health said last week that it would no longer offer its Oncotype SEQ liquid biopsy test, nor continue its other research and development efforts in next-generation sequencing.

The withdrawal is the first so far among the major diagnostics firms who were first out of the gate in commercially launching NGS tests that detect cancer mutations in patients' blood, highlighting the fact that the future for these technologies in the clinic is still uncertain.

Genomic Health had been one of handful of prominent firms that began offering clinical NGS testing of circulating cell-free DNA over the past four years, along with Guardant Health, Foundation Medicine, Personal Genome Diagnostics, and Resolution Biosciences, among others.

When it launched Oncotype SEQ in mid-2016, Genomic Health said that the assay was the first in what would be a suite of liquid biopsy tests for the diagnosis and monitoring of cancer.

The NGS assay analyzed 17 genes that Genomic Health picked based on their clinical actionability and relevance to therapeutic decision-making for several different cancer types, including lung, breast, colon, melanoma, ovarian, and gastrointestinal stromal tumors.

Until last week, Genomic Health made no indication that the early-access launch of the test was not boding well for further commercialization.

The company presented data in October 2016 at the European Society for Medical Oncology Congress in Copenhagen, reporting per-sample sensitivity down to a 0.1 allele fraction for single nucleotide variants, or below three copies for CNVs, with more than 99 percent specificity.

At the time, Genomic Health chief medical officer Phil Febbo argued that the narrower design of the Oncotype test compared to assays from firms like Guardant Health would be an asset in terms of addressing the actual needs of the clinic without overwhelming physicians with information they couldn't use.

The company made a very conscious effort to only include genes in which detected variants would have therapeutic impact based on their inclusion in an FDA drug label, in NCCN guidelines as either an established or emerging marker, or as a referral mechanism to a Phase II-Phase IV clinical trial.

The fact that Guardant and other companies have seen continued use of their tests by a wide variety of clinical research groups while Genomic Health has discontinued Oncotype SEQ illustrates that adoption doesn't always follow the logic of clinical guidelines.

Genomic Health didn't provide many details about the decision to terminate Oncotype SEQ, but the company's description of the decision as a business strategy that also includes focusing on products with a clear reimbursement path suggests that the early-access period revealed that the test would not see an easy path to adoption or reimbursement.

Genomic Health hasn't publicly provided details on adoption rates or test volume for the assay, but a spokesperson said this week that use of the test was "limited given the targeted nature of our commercial activities … as we awaited clarity on reimbursement."

"A number of factors did go into the decision," Genomic Health's President, CEO and board chairman Kim Popovits said last week during an earnings call with investors. These included "prioritizing our near-term growth opportunities, balancing the path through reimbursement, the path through regulation, [and] the costs associated with that in a market that is becoming more and more crowded."

Fred Pla, Genomic Health's chief business and product development officer, added that a full launch of the NGS liquid biopsy test was always predicated on having "more clarity on reimbursement."

According to Pla, there were also some external factors that played a role. "You saw earlier this week, for instance, a recent publication by ASCO and CAP outlining the current lack of clinical utility for liquid biopsy [and that] doesn't really help us in terms of adoption," he said.

He also noted that the US Centers for Medicare & Medicaid Services draft national coverage determination (NCD) on next-generation sequencing cancer panels, which is expected to be finalized this week, would likely restrict cancer patients' access to NGS panels and hinder diagnostics innovation.

Representatives from the laboratory community have argued that the draft form of the NCD suggest unfair roadblocks to NGS tests that have not been FDA approved, something that Febbo said "substantially raises the bar in terms of investments companies need to make to drive reimbursement and adoption [and] extend the timeline to get profitable growth with these products."

Other firms offering NGS liquid biopsy tests have not seemed as concerned by these hazards though. Guardant Health, for example, has reported that it's Guardant360 test has been ordered tens of thousands of times by thousands of oncologists at this point.

Last spring, the company successfully won approval from New York State's Clinical Laboratory Evaluation Program for the test, as well as a draft local coverage determination from Medicare contractor Palmetto GBA proposing coverage of the test for patients with advanced non-small cell lung cancer under certain conditions. This year Guardant said that it is moving forward to submit its test to the FDA, having received an Expedited Access Pathway designation.

Foundation Medicine also nabbed New York State approval for its FoundationACT blood-based circulating tumor DNA assay last year and has said that it is advancing a blood-based version of its tumor mutational burden test as a companion diagnostic to Roche/Genentech’s immunotherapy drug Tecentriq (atezolizumab) in first-line treatment of NSCLC patients.

And PGDx said in June that it had expanded an existing contract with US Department of Veterans Affairs facilities to provide its PlasmaSelect 64 liquid biopsy test to advanced cancer patients receiving treatment at the VA.

For its part, Genomic Health stressed that it is not moving away from liquid biopsy all together, just away from sequencing, or what it called "non-proprietary" broad panels.

"We thought that it was in the best interest of the business and clearly of our shareholders … to really focus on these near-term catalysts and the new things that we put in the pipeline that we believe can drive longer-term growth," Popovits explained.

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