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Biocept to Launch Lung Cancer Test in Q4; Sees Ability to Monitor CTCs and ctDNA as Differentiator

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This article has been updated from a previous version to more accurately characterize cell-free DNA (cfDNA) as circulating tumor DNA (ctDNA).

NEW YORK (GenomeWeb News) — In the wake of a February IPO that raised $19 million in gross proceeds, oncology diagnostics firm Biocept plans to launch its first "liquid biopsy" test with a molecular component by the end of this year.

Called OncoCEE-LU, the test is a multi-parameter assay for prognosis, monitoring, and therapy selection in lung cancer patients, and will rely on the company's two core technologies — OncoCEE, a cell enrichment and extraction method; and CEE-Selector, a highly sensitive PCR-based mutational analysis technology — to analyze both circulating tumor cells and circulating tumor DNA from the patients.

Following this launch, which Biocept will offer from its CLIA-certified/CAP-accredited lab in San Diego, the company plans in 2015 to introduce several other assays using the same approach, including tests for gastric cancer, colorectal cancer, prostate cancer, and melanoma — all of which are expected to drive the first meaningful revenue growth for the company in 2015 and beyond, said Biocept CFO William Kachioff.

Kachioff and Biocept CEO Michael Nall discussed these plans as well as the company's strategy for growth in an interview with PCR Insider in New York this week.

Last week, Biocept reported that its second quarter revenues dropped 60 percent to $19,245 from $48,369 in the same quarter last year — a decline it chalked up to lower sample volume related to a collaboration with Dana-Farber Cancer Institute that is nearing completion.

However, Kachioff said this week that the company's current quarterly revenues "in the context of where we are planning to go are essentially trivial right now. We expect to be generating revenues in the millions per quarter in a year or year and a half. That's the type of magnitude we should be thinking about."

This revenue growth will initially come from Biocept's planned lab offerings to physicians, but CEO Nall said that this is just one of the company's three "pillars of revenue generation."

"The first pillar is clinical commercial cases [where] … we get a tube of blood from an oncologist … we do our proprietary testing, we return a personalized medicine report back to that referring physician, and they use it to make treatment decisions. We get revenue by billing insurance or Medicare or whoever the responsible party is for that test, in the traditional way." To that end, the company announced earlier this month that it has hired a new senior director of managed care and reimbursement strategies, Amy McNeal, former manager of the North American managed care unit at GE Healthcare.

Biocept's second pillar is focused on partnering with biopharma companies on clinical trials to provide "a better way to qualify patients through a liquid biopsy as well as … monitor them so they know when it's time to change drugs." Nall said this is a "big opportunity" for growth that spurred the company to also recently hire two business development employees specifically for that purpose. "And by doing that with pharma, that helps get us down the road to companion diagnostics, and of course that feeds us … on the clinical commercial side," Nall said.

Biocept's third growth pillar comprises general partnership and licensing opportunities. "We can help other folks who have proprietary assays take their assay and move it to a liquid biopsy, as long as it's not competitive," Nall said.

In terms of its own offerings, Biocept already sells one liquid biopsy test called HER2(FISH): OncoCEE-BR which, as the name implies, uses the OncoCEE method followed by FISH and immunocytochemical staining to analyze HER-2 amplification from peripheral blood samples of breast cancer patients to aid physicians with prognosis, monitoring, and therapy selection.

Although Biocept has just begun to see revenues trickling in from sales of this assay, its vision, as well as its means of distinguishing itself from competing firms with blood-based oncology assays, is the addition of molecular methods such as CEE-Selector — which PCR Insider covered last year — and eventually sequencing to its analysis routine. In short, CEE-Selector is a PCR-based technology that the company claims can identify and quantify single mutations in a background of 10,000 to 100,000 wild-type sequences. "What you'd normally see in the best oncology labs in tissue is about one in 100, so 1 percent. We're down to about .01 percent," Nall said.

But CEE-Selector is just one component of Biocept's assays. Although the company sees competitors for either CTC or ctDNA analysis, it does not see a competitor on the horizon that does both.

"The beauty of Biocept is that we're able to have them both," Nall said. "Especially when you look, at this point, research and biopharma [partners], they can send one tube of blood and we're able to analyze that both on the cellular level, with the circulating tumor cells, as well as cell-free in the plasma. That helps them decide the best path for us to go down as we develop a companion diagnostic."

"You're going to need to look at protein, DNA, RNA … someday exosomes – all of these have a different application, and they all have different ways to get that information out of that cell," Nall added. "It's all meaningful for a cancer patient. So to me, to try to say one is all you need, I think is short-sighted."

Biocept's first assay that will attempt such a multiparameter analysis is the OncoCEE-LU for lung cancer, which the company will roll out through the third and fourth quarters of this year, and perhaps into early 2015. The launch will occur in stages, Nall noted, as the company finishes validating and adding lung cancer biomarkers to the assay.

"As we validate each marker, we're just going to launch it," Nall said. "We're not waiting to launch everything at once. We're currently validating many of these today, and … some of these are rare mutations, so trying to get the people we know are positive from tissue[-based assays] and correlate that same mutation in that patient's blood, it's a little bit tough to validate, but we're working on it now."

This assay will initially perform CTC enumeration and examine ALK, MET, and ROS1 using FISH; and by early next year will integrate analysis of KRAS, BRAF, EGFR, and ALK mutations using CEE-Selector.

According to the company's most recent 10Q document, it also hopes to begin offering OncoCEE-GA for gastric cancer by the end of this year, although that assay will enumerate CTCs and analyze HER2 strictly using FISH. Future planned offerings include OncoCEE-CR for colorectal cancer in Q2 2015; OncoCEE-PR for prostate cancer in Q3 2015; and OncoCEE-ME for melanoma in Q2 2015. The company also currently offers OncoCEE-DTC for breast and prostate cancer disseminated tumor cell analysis as a research tool for biopharma partners.

All of these assays will use some combination of the CTC capture technology, FISH, and CEE-Selector.

Biocept's ultimate long-term goal is to provide an array of liquid biopsy tests that will allow physicians to more easily and less invasively monitor cancer patients.

"With lung cancer there is low-hanging fruit, because we know there are resistance markers today that can tell people when [tyrosine kinase inhibitors] are going to stop working," Nall said. "Over time and as we get more data, we'll continue to establish correlative data that show we get the same results as doing a tissue biopsy, and I think that's going to push us further down that road."

However, in the near term, "there is a big market for us for people who can't be biopsied and who need to be monitored. You can't keep going in and taking tissue biopsies to monitor someone," Nall added. The medical establishment, he noted, has essentially been performing liquid biopsies for blood-based cancers for years, "and everybody knows we need to do the same thing with solid tumor – there just hasn't been a good way. Everyone is very excited about this concept of the liquid biopsy to make monitoring a reality. And some day that leads to screening. But we need a lot more data."

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