NEW YORK – As part of its quarterly earnings update this week, Veracyte highlighted preliminary clinical data demonstrating the ability of its new nasal swab assay to diagnose lung cancer in its earliest stages.
The data was presented in a poster by Veracyte and collaborators at the Lahey Hospital and Medical Center and Johnson & Johnson at the annual meeting of the American College of Chest Physicians (CHEST) in New Orleans.
In an earnings call with investors on Tuesday following the close of the market, Veracyte CEO Bonnie Anderson noted that the "two-cutoff" nasal swab classifier will complement computed tomography (CT) imaging to help guide patient diagnosis using 26 genetic biomarkers and clinical variables. Veracyte anticipates launching the assay, which is being developed in partnership with Johnson & Johnson and has the working name of "NasaRISK," by early 2021.
"When a potentially malignant lung nodule is found, physicians lack accurate and reliable tools to determine which patients require more invasive diagnostic evaluation and those who can be managed with noninvasive surveillance," Carla Lamb, an interventional pulmonologist at Lahey Hospital and the principal investigator on the study, said in a statement.
During the conference call, Veracyte Chief Scientific Officer Giulia Kennedy explained that the nasal classifier allows users to detect genomic damage associated with lung cancer in the airways of current or former smokers. Specifically, the test is based on the concept of "field of injury" in which altered gene expression is seen in bronchial epithelial cells in current or prior smokers with a malignancy. The new assay, however, extends the field of injury concept to the nasal epithelium.
In the prospective study, Lamb and her team collected a total of 675 nasal swab samples from the AEGIS clinical trial previously conducted by Allegro Diagnostics, which Veracyte acquired in 2014. Following a group of current and former smokers with suspected lung cancer nodules found on CT scans for a year, the team noted when clinicians made a final diagnosis of either lung cancer or benign disease.
Dividing the patients into a training set of 411 nasal samples and an independent test set of 261 nasal samples, Lamb and her team extracted RNA and used whole-transcriptome sequencing, followed by analysis using Veracyte's "feature extraction pipeline." The researchers then established the assay's ability to identify patients as high-risk and low-risk for cancer using machine learning models that were trained to identify two conditions, benign and malignant cases, using genomic and clinical features.
Lamb and her team found that the nasal swab assay classified patients with benign nodules as low-risk with about 97 percent sensitivity and 46 percent specificity.
"This means that, among patients whose nodules were actually benign, the genomic test classified over 40 percent as low risk for cancer with high accuracy so that these patients could be monitored non-invasively," Kennedy said during the call. "High sensitivity is crucial for a test used at this point, because if physicians are directing patients to monitoring, they would not want to miss cancers."
Meanwhile, the assay classified patients with malignant nodules as high-risk for cancer with about 94 percent specificity and 50 percent overall sensitivity. "Thus the test achieved success at both ends of the spectrum calling truly benign patients low risk with high sensitivity and calling truly malignant patients high risk with high specificity," Kennedy said. The team also noted that the test's performance was consistent regardless of lung nodule size or location, as well as cancer subtype or stage, giving Veracyte confidence that the classifier can perform in smaller nodules in a diversity of cancers" that physicians might encounter during screening.
The researchers also found that the nasal swab test would identify over 70 percent more patients as low-risk and 18 percent more patients as high-risk compared to the standard "Gould" clinical risk model for lung cancer.
Finally, Kennedy noted during the call that because the cancer prevalence rate in the AEGIS cohort was high (78 percent), the researchers modeled how the test would perform in a population with a cancer prevalence of 25 percent, "which is more aligned with the patients on whom it will be used."
In this scenario, with the sensitivity of more than 95 percent, the test's negative predictive value would be 98 percent when it identifies patients as low risk with fewer than 5 percent of truly malignant patients misclassified as low risk, Kennedy said. Meanwhile, its positive predictive value would be 76 percent when it identifies patients as high risk for cancer with less than 6 percent of true benign patients misclassified as high risk, she said.
"We're very pleased with the strength of these early data and looks forward to further refining the classifier and preparing it for commercialization," Kennedy said. "Specific next steps will include analytical work to ensure robustness of the test system and sample collection methods along with additional studies needed for our publication pipeline."
Lahey Hospital's Lamb further noted in a statement that "given the nasal classifier's ability to more accurately classify cancer risk in patients with lung nodules, the test can help address this diagnostic gap, potentially helping to save more lives while also enabling patients to avoid unnecessary invasive procedures and reducing costs."
In a note to investors, Brian Weinstein of investment bank William Blair said that while Veracyte's data on the nasal swab classifier "has advanced nicely," the firm will need to clarify the clinical results in both risk cohorts. Veracyte will also need to elaborate on multiple issues, including potential barriers to running the test on patients in a pre-CT screening setting, as well as how far the firm is in identifying other uses for the technology.
Veracyte said that it estimates the market opportunity for its nasal swab test, when used to assess lung cancer risk in patients with lung nodules identified by imaging, is approximately $1.9 billion in the US and $3.9 billion for both the US and EU. To Weinstein's point, the company also said it plans to explore opportunities to deploy the field of injury technology at "other points along the lung cancer care continuum."
Despite the relatively positive news on its new nasal swab assay and strong Q3 financial results, shares of Veracyte dropped precipitously in Wednesday trading on Nasdaq. After opening up a percentage point in the early hours, shares dropped almost 16 percent to $22.10 by the end of the day Wednesday.