By Ben Butkus
Cepheid's PCR-based test for tuberculosis and rifampicin resistance has received another clinical endorsement for its ability to perform in remote and resource-poor regions of the world, according to a research study published this week.
The positive findings were published in the same week that Cepheid reported strong first-quarter results and several financial analysts raised their earnings estimates and price targets for the company.
The study, led by clinical researchers from the Foundation for Innovative New Diagnostics, found that Cepheid's Xpert MTB/RIF molecular test, when administered to patients in decentralized laboratories in the developing world, had sensitivity and specificity comparable to the test's performance in previous studies in more centralized reference laboratories.
In addition, the new study demonstrated that the test's fast time to result led to a reduction in median time to treatment from nearly two months to less than a week, suggesting that the assay could lead to an improvement in TB care and control.
Cepheid developed the Xpert MTB/RIF, which runs on the company's fully automated, sample-to-answer GeneXpert instrument, in collaboration with FIND and the University of Medicine and Dentistry of New Jersey, and with funding from FIND, the National Institutes of Health, and the Bill and Melinda Gates Foundation.
The test had already received a strong clinical vote of confidence in other studies, in particular one published in September in the New England Journal of Medicine, where it successfully identified 98 percent of culture-confirmed TB cases, and detected resistance to the anti-TB drug rifampicin in more than 97 percent of patients, all while being run by relatively unskilled healthcare workers in less than two hours (PCR Insider, 9/2/10).
That study tested patient samples collected from multiple sites in more centralized reference laboratories. However, as noted by the authors in a study published this week in The Lancet, "diagnostic tests often do well in initial studies that are usually done in near-ideal settings in reference laboratories; however, performance is frequently reduced when assays are tested in settings of intended use."
As such, the authors aimed to establish in their study whether Xpert MTB/RIF "was robust enough to retain high accuracy when used in district and subdistrict health facilities in resource-poor countries, and to measure the operational feasibility and effectiveness of its implementation in such settings."
To that end, the researchers assessed adults with suspected TB or multidrug-resistant TB at health centers in South Africa, Peru, and India; drug-resistance screening facilities in Azerbaijan and the Philippines; and an emergency room in Uganda. In nine adjacent microscopy laboratories, the researchers compared Xpert MTB/RIF testing with sputum smear microscopy and culture, depending on the site; as well as with drug-susceptibility testing.
The group enrolled 6,648 patients between Aug. 11, 2009, and June 26, 2010, and found that Xpert MTB/RIF detected 933, or 90.3 percent, of 1,033 culture-confirmed cases, compared with 699 of 1,041, or 67.1 percent, for microscopy.
MTB/RIF test sensitivity was 76.9 percent in smear-negative, culture-positive patients; and 99 percent specific, correctly identifying 2,846 of 2,876 non-TB samples. Meantime, Xpert MTB/RIF sensitivity for rifampicin resistance was 94.4 percent, while specificity was 98.3 percent. Further, unlike microscopy, MTB/RIF test sensitivity was not significantly lower in patients with HIV co-infection.
As noted by the researchers in the paper, by and large "MTB/RIF testing in subdistrict microscopy facilities by routine staff with minimal training retained the accuracy seen in previous controlled studies that were undertaken in reference centers."
However, although the sensitivity and specificity of Xpert MTB/RIF testing for rifampicin resistance was high in The Lancet study, the authors noted that the accuracy was higher in previous publications, including last year's NEJM study, which demonstrated nearly 100 percent sensitivity and specificity.
"Assay development partners are working to further improve MTB/RIF test accuracy of detection of multidrug-resistant TB," the researchers wrote. "The low positive-predictive value of MTB/RIF for rifampicin detection that we noted in patients with a low pretest probability of multidrug-resistant TB might justify the need for confirmatory testing with conventional methods in such settings."
The Lancet study is also the first in which test results were made available to clinical staff to inform patient management, and as such is also the first to describe the impact of Xpert's fast time to detection on treatment schedule.
According to the researchers, the short turnaround time resulted in "substantially faster initiation of appropriate TB therapy, particularly for patients with smear-negative disease, and lower dropout rates." Because many TB patients drop out during the typical diagnostic process by failing to submit specimens for microscopy when necessary, not returning after submitting an initial specimen, or not receiving or acting on positive test results, "rapid testing, even if less sensitive than slower methods, can result in more patients being correctly treated," the authors wrote.
Overall, the researchers estimated that use of Xpert MTB/RIF reduced median time to treatment for smear-negative TB from 56 days to about five days.
Despite Xpert MTB/RIF's strong performance, the researchers noted several issues that might restrict its use in small health centers such as those included in the study. Chief among these are that the GeneXpert system requires a stable electrical supply (although some centers successfully tested battery operation); Cepheid does not currently recommend use of the system above 30°C (86°F); and the system needs to be calibrated yearly, which requires either access to an MTB/RIF test distributor or expertise within the test center to replace modules as necessary.
Nevertheless, the researchers concluded that the "robustness of these data suggest that the test can be used in various resource-scarce settings for case detection and rapid decentralized screening of multidrug-resistant TB;" and that the "ability to rapidly detect smear-negative TB in peripheral settings, including among patients with HIV, is a breakthrough in TB care and control."
The early success of Cepheid's test has not gone unnoticed by financial analysts, several of whom this week assigned favorable ratings to the company's stock in the wake of a strong first quarter of financial results.
For instance, Quintin Lai of Robert W. Baird & Co. noted today that Cepheid's TB opportunity is "materializing faster than expected" as the company generated $1.6 million in instrument revenues in Q1 2011. Cepheid has had "an impressive response by developing countries looking to implement GeneXpert for TB testing and has already placed systems in 24 countries with discussions in over 50 additional countries," Lai noted.
Baird is maintaining an Outperform rating for the company and raised its price target to $35 from $30.
In addition, Oppenheimer analysts wrote in a report today that the 178 GeneXpert systems placed by Cepheid in Q1 2011 were substantially higher than their forecast of 110. This was driven by 58 placements from Cepheid's High Burden Developing Country Program, which added $1.6 million to Cepheid's Q1 sales, "providing a faster than expected benefit," they noted.
Oppenheimer is also maintaining an Outperform rating for Cepheid and raised its 2011 revenue estimate to $257.4 million. Cepheid has projected revenue of $245 million to $255 million for the full year.
Overall, Cepheid reported yesterday that its Q1 revenues increased 25 percent year over year on strong clinical sales. Cepheid said that revenues totaled $60.2 million for the three-month period ended March 31, compared to $48 million for the first quarter of 2010. Clinical systems sales were up 20 percent to $11.6 million, while clinical reagent sales jumped 31 percent to $38.6 million.
In a conference call discussing Cepheid's Q1 results, CEO John Bishop said that the company's clinical business now represents more than 87 percent of the company's product revenue. Sales for Cepheid's non-clinical business slipped 6 percent year over year to $7.4 million from $7.9 million.
In other news, Bishop noted that the firm's flu panel to detect and differentiate flu A, B, and 2009 H1N1 is currently under review by the US Food and Drug Administration; and that Cepheid hopes to launch its Chlamydia trachomatis/Neisseria gonorrhoeae test in the US next year, preceded by the release of a CE-IVD Marked product.
In addition, its CE-Marked TB test and CLIA-waived Staphylococcus aureus tests are both progressing toward clinical trials in the US; and the company also has tests in development to address the high-volume HPV, HIV, and HCV markets, targeting a 2012-2013 launch for these tests as CE-IVD Marked products, Bishop said.
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