This story originally ran on Jan. 7.
By Tony Fong
After a decade of getting its technology up to snuff and creating a business infrastructure for its clinical-diagnostics ambitions, Arrayit last month announced it would be seeking regulatory approval for a protein array-based ovarian cancer test, launching the firm into the diagnostics space.
In a statement announcing its plans, Arrayit said that it intends to file its OvaDx test for early ovarian cancer detection with the US Food and Drug Administration for 510(k) clearance. It added that barring "unexpected delays" in the FDA approval process, the test could be ready for full commercial launch as ea rly as the third quarter, following its launch for research purposes in the first quarter.
Arrayit President Mark Schena told ProteoMonitor that the main difference between OvaDx and CA125, the established biomarker for ovarian cancer, is that OvaDx "allows primary screening of all women, whereas CA125 is used mainly as a monitoring tool for women who already have ovarian cancer."
"OvaDx allows early-stage, pre-symptomatic detection of ovarian cancer," he added, "and as such, OvaDx is used as a preventative medicine health care product."
The National Cancer Institute estimates that in 2009 there were about 21,550 new cases of ovarian cancer diagnosed and about 14,600 deaths from the disease.
During the summer, Arrayit created a subsidiary, Arrayit Diagnostics, to market and sell OvaDx, as well as other tests under development. In the company's statement, Arrayit Diagnostics CEO John Howell said that the plan is to sell OvaDx as a test kit priced at about $350. If it is successful in getting FDA approval by the third quarter, revenue of $4 million to $5 million in its first year on the market "is an attainable goal," he said.
After that, the total worldwide market for the test, he told ProteoMonitor, could reach into the billions of dollars.
OvaDx was developed completely in house, Schena said, and is based on a different set of biomarkers than those discovered by Wayne State University researchers for detecting early-stage ovarian cancer and licensed by Arrayit. Last month, the company said that it is partnering with the university scientists to further develop those biomarkers into a microarray-based diagnostic.
OvaDx, which is in a microarray-on-a-planar-surface format and is serum-based, was developed using Arrayit's proprietary technology for manufacturing microarrays. Protein samples are loaded from 384-well microplates into 48 printing pins by capillary action, Schena said. They are then deposited onto 210 glass substrates "using very gentle contact between the samples on the pin tips and the glass surface," he said.
"Using absorptive interactions, the glass surface gently pulls [the] sample off the pin tips, resulting in printed protein microarrays that retain full biochemical activity," Schena added.
He said that the company's protein array platform offers "high-speed manufacturing, the ability to print large protein molecules, complete retention of functional activity, good durability post-printing, strong signals and high specificity."
In comparisons with ELISAs and other traditional assays, he said, Arrayit's technology "routinely" has achieved better specificity, sensitivity, and greater throughput. That, in addition to its affordable price point, "will make us very competitive in clinical diagnostics," he said.
The company is currently designing the clinical trials for OvaDx, but Schena declined to provide further details until after Arrayit has submitted its 510(k) application.
Schena helped the FDA develop its protocols for microarrays as in vitro diagnostic multivariate index assays, and was part of the agency's Microarray Quality Control project. The company has had discussions with the FDA about OvaDx, but officials declined to comment on them.
While Arrayit, based in Sunnyvale, Calif., offers more than 650 products including microarray platforms, various kits, and reagents, it has no diagnostic tests. If it is successful in launching OvaDx, it would represent a new market sector for it — though one that it has been preparing for since the first draft of the human genome was successfully done.
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"We've spent the better part of the past decade positioning Arrayit to become a healthcare company," Schena said.
In a 2001 PBS documentary on the efforts to map the human genome, "Cracking the Code of Life," Schena first talked about using microarray technology to develop diagnostic tools to better understand disease on the molecular level and eventually create new therapies.
'We've spent the better part of the last decade essentially building the technological foundation for moving into clinical diagnostics and obviously that spans the gamut from important early patent filings and making sure patents [are issued] to developing a series of proprietary technologies and trade secrets that enable us to deliver clinical healthcare information at an affordable price point and with an accuracy that's required for clinical diagnostics," Schena said.
According to a company spokesman, about five years ago, Arrayit built a CLIA-approved laboratory and developed a series of diagnostic tests using its microarray technology.
The technology behind OvaDx has been mature and robust enough for commercialization for several years, Schena said, and the reason for bringing it to market now was predicated mainly on "business and finance issues," which included identifying investors who were interested in specific tests only.
Now ready to go into full commercial mode, Arrayit in August set up Arrayit Diagnostics, based in Houston. The strategy moving ahead is to create further spin-offs for each disease for which the company develops a diagnostic tool. In addition to ovarian cancer, Arrayit is collaborating with the Parkinson's Institute and Clinical Center in California on a diagnostic test for Parkinson's disease. The company is also developing a tool for diagnosing prostate cancer.
Arrayit Diagnostics Ovarian is already created, and Arrayit Diagnostics Parkinson's and Arrayit Diagnostics Prostate are being formed.
Each diagnostics subsidiary would be responsible for its own funding to develop and market its test.
The rationale for this strategy, as opposed to selling multiple tests under one corporate roof, is to prevent any potential drain that one product may have on the overall business, Howell said.
"Each subsidiary is going to have its own unique relationships with sponsored research agreements … or different methodologies for raising capital and it's going to have a different marketplace," he said. "We're an international company, so each one will have its own operation and feel in different countries."
Schena added that such a corporate structure creates efficiencies in terms of implementation and logistics and makes each business accountable for itself.
"It's very important for Arrayit that all of our divisions are profitable, and certainly one way to ensure that is to create accountability in the form of subsidiaries," he said.
For the quarter ended Sept. 30, 2009, the company posted revenues of $1.1 million, up almost 42 percent from $782,830 during the year-ago period. Profits rose to $2.4 million, up from a loss of $289,849 a year before.
The company also has been approached for possible M&A deals, Schena added, "and there are some advantages to having standalone subsidiaries that are dedicated to specific products that have an existing revenue stream."
No decision has been made on whether Arrayit will partner with another firm if and when it does bring OvaDx to market, Howell said. Once it finishes the first part of the clinical trial for the test, the firm will also contract with another company to establish reimbursement rates with insurers, he said.