© 2019. All rights reserved by PierianDx 1
Chris Callahan, Chief Operating Officer and Executive
Vice President
NGS Testing in Today’s
Precision Medicine Landscape
What Labs are Running and What Your Lab should do now
© 2019. All rights reserved by PierianDx | Confidential 2
2003 WashU plays critical role in Human Genome Project.
Today Full suite of software and services
Independent CLIA/CAP “dry lab”
40+ medical center, cancer center, health system, and reference lab clients
200+ yrs of clinical genomics experience
2014 PierianDx est. after ~50 labs visit WashU to learn how clinical NGS is operationalized.
2011 WashU among first to validate and clinically report on somatic cancer NGS panels.
Leaders in Clinical Genomics Pioneers in Precision Medicine
2
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Overview NGS Testing in Today’s Precision Medicine Landscape
2 ROI to Bringing Testing In House
3 What Your Laboratory Should Do Now
1 Recent Trends
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NGS Testing is Coming of Age Recent Trends
Key Findings ■ AMCs and NCI Centers have brought clinical
NGS in-house ■ Physicians in community still sending out to
reference labs ■ Some laboratories have implemented reflex
testing for certain tumor types ■ Despite improved coverage, cost and
reimbursement can be challenging
Source: BHA analysis of qualitative interviews with 30 Pathologists and/or Lab Directors
Anticipated Growth of NGS Testing Market
Pathologists anticipate an increase in NGS-based testing moving forward as coverage landscape continues to improve and more targeted therapies get approved
$8.0B
5.5 MM Tests
2017
1.1MM NGS
2020
3.2MM NGS
$11B
8.0 MM Tests
12-15% per annum revenue growth
20% NGS in 2017 40% NGS in 2020
Source: Epstein Health
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CMS’ National Coverage Decision Recent Trends
Private payors are covering for their managed Medicare lives, but not uniformly for commercial lives
On March 16, 2018 CMS released a national coverage determination to cover NGS in patients with cancer.
Two Pathways for Coverage CMS has created 2 pathways for coverage for next generation sequencing in advanced cancers for FDA-approved or cleared companion diagnostics:
CMS-identified, Covered Assays
FoundationFocus™ CDxBRCA (Foundation Medicine)
F1CDx (Foundation Medicine)
Oncomine™ Dx Target Test (Thermo Fisher Scientific, Inc.)
Praxis™ Extended RAS Panel (Illumina)
Source: BHA Analysis
The NCD preserves a Medicare coverage pathway for LDTs through the LCD process
NCD MACs
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Key Reimbursement Updates Recent Trends
Oncology
NGS Coverage
Payer Cost Control
Coding and Payment
Regulatory
● Molecular testing in advanced cancers expected to move from single marker to NGS ● NGS testing will expand when coverage is widely established
● Payors are moving toward mutation-based coverage policies ● Private payors don’t embrace coverage with evidence development but there is movement to incorporate real-
world evidence in coverage decisions ● MolDx program expected to expand
Source: Boston Healthcare Associates Analysis
● Outsourcing to laboratory benefit managers is creating additional bureaucracy for laboratories ● Several private payors have a desire to engage in risk-sharing agreements/value based contracting in oncology
but may have challenges implementing given cost and complexity
● Coding and payment for NGS has evolved considerably with a move toward bundled or test-specific coding as opposed to stacked coding
● There are recent examples of incremental reimbursement for FDA-approved testing from Medicare but similar examples aren’t expected from private payors
● FDA is seeking to oversee and regulate LDTs; this will likely push labs to adopt FDA-approved kits whenever possible
● Class-based CDx labeling will change the pharma-Dx partnering landscape with the potential for more consortia-type agreements
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What Type of Tests are Labs Running? Recent Trends
“Explosion of biomarker testing. It’s been huge in the lung field, expanded in breast and colon. I think it's being used more in thyroid. I can't speak to the other rare tumor types. I know we'll do an NGS panel on tumors when we are unclear on primary diagnosis or we are looking for targeted therapy.” - Pathologist, Community Hospital
Growth of NGS testing for TMB, and MMR proficiency with a view towards immunotherapy and more generally, an increase in testing to qualify patients for therapy.” - Pathologist, Community Hospital
NGS Testing Biomarker Testing
Progressive increase in oncology due to tumor agnostic biomarkers developed to inform targeted and immune therapies
Standardized testing algorithms drive biomarker testing for common tumors (NSCLC, CRC, breast) at diagnosis at many healthcare settings
Source: BHA Analysis
More laboratories performing NGS for common tumor types with approved therapies
Tumor agnostic markers, such as MSI, TMB and NTRK fusions are significant driver of more NGS testing
Improving payor coverage with recent Medicare coverage for FDA-approved NGS tests
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Oncology Testing is Evolving Recent Trends
Current Near-Term Long-Term
Single Markers and Hotspot Panels Specific patient populations are tested for specific biomarkers using conventional methods (e.g., EGFR PCR for NSCLC
Limits on tissue availability make this approach less sustainable long-term
Multi-Modality Mix of test methods gives best picture
Possible reflex test patterns with some tests being prioritized because of their ease of use/affordable cost
Some FDA approved; some LDTs
Broad NGS Testing NGS / CGP increasingly dominates conventional methods (e.g., PCR, FISH
Use of a single test on a single sample to obtain a comprehensive biomarker status of the patient
Informatics deployed to create genotypic and phenotypic profile of patient
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In vitro Diagnostics is a Game Changer Commercial Pan-cancer Assays
2019
500+
1+
5-50
2011
<2011
2019
2017
500+ Provider Assay Genes
PGDx PGDx 500+
Illumina TruSightTM Oncology 500
Memorial Sloan MSK-Impact 468
Foundation Medicine F1CDx 324
Illumina TruSightTM Tumor 170
ThermoFisher Oncomine 162
50+
Sold as kits for RUO/LDT
Public plans for IVD
Genes
What if, instead of multiple tests, you could perform a single test that looked at all relevant biomarkers simultaneously?
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CGP Can Identify Actionable Alterations Recent Trends
1. Stransky N, Cerami E, Schalm S, Kim JL, Lengauer C. The landscape of kinase fusions in cancer. Nat Commun. 2014;5:4846. doi:10.1038/ncomms5846. 2. Boland GM, Piha-Paul SA, Subbiah V, et al. Clinical next generation sequencing to identify actionable aberrations in a phase I program. Oncotarget. 2015;6(24):20099-20110. 3. Massard C, Michiels S, Ferte C, et al. High-throughput genomics and clinical outcome in hard-to-treat advanced cancers: results of the MOSCATO 01 trial. Cancer Discov. 2017;7(6):586-595. 4. Harris MH, DuBois SG, Glade Bender JL, et al. Multicenter feasibility study of tumor molecular profiling to inform therapeutic decisions in advanced pediatric solid tumors: the individualized cancer therapy (iCat) study. JAMA Oncol. 2016;2(5):608-615. 5. Parsons DW, Roy A, Yang Y, et al. Diagnostic yield of clinical tumor and germline whole-exome sequencing for children with solid tumors. JAMA Oncol. 2016;2(5):616-624.; 6. Reitsma et al., 2019. Effect of a Collaboration Between a Health Plan, Oncology Practice, and Comprehensive Genomic Profiling Company from the Payer PerspectiveJournal of Managed Care & Specialty Pharmacy.
30%–90% Of patients who undergo Genomic Profiling may have actionable alterations
2 Studies with pediatric solid tumors4,5
Prospective Clinical Trials—843 patients with advanced
cancers3
500 patients with advanced cancer, multiple
tumor types2
49% 31–39% 30%
% of patients found to have an ACTIONABLE genetic alteration, after genomic profiling
96 patients with multiple tumor types6
90%
Slide courtesy of Illumina
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CGP Has Value in Patient Management Recent Trends
Increase Clinical Trial Eligibility Greater than 1000-fold
4% → 54% Increase Targeted Therapy
Utilization projected to double
6% → 13%
Reduce Adverse Events Decreased by one-third
↓33% Reduce Costs of
Non-targeted Therapy Cost decreases by $6.6M
$6.6M ↓
Reitsma et al., 2019. Effect of a Collaboration Between a Health Plan, Oncology Practice, and Comprehensive Genomic Profiling Company from the Payer Perspective Journal of Managed Care & Specialty Pharmacy.
Slide courtesy of Illumina
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Insourcing NGS Testing Molecular diagnostic market size is projected to reach $10.12 Billion from $6.54 Billion in 2016, at a CAGR of 9.1%. As most diagnostic tests are performed in-house, the hospital & academic laboratories segment is expected to dominate the market.
Source: ReportsnReports
2016
$6.5B $10.1B
2021
Volume
Hospitals billing for comprehensive genomic profiling (CGP)
IDNs (Non-NCI)
45
149
33
3
NCI - Designated Centers Community Hospitals (Non-NCI, Non-IDN, Non-AMC)
AMCs (Non-NCI, Non-IDN)
Today, most of the CGP volume is going to a few independent reference labs.1
Recent Trends
Source: Boston Healthcare Associated Analysis
However, academic medical centers and community hospitals are expected to insource more of these tests now that there’s a clear pathway to reimbursement.
Source: Admin. With CMS coverage policy, NGS cancer testing goes large. CAP TODAY. https://www.captodayonline.com/cms-coverage-policy-ngs-cancer-testing-goes-large/. Accessed April 26,
2019.
Source: Boston Healthcare Associated Analysis
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Why Bring NGS Testing In-House Return on Investment
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Gain Control, Reduce Costs, and Expand Leadership
Control Achieve reduction in QNS by performing in-house4
■ QNS as high as 27% in NSCLC2 send-out tests
■ University of Vermont has a QNS of 1-2% by bringing testing in-house1
Decrease TAT
■ TAT for send-outs is 21+ days
■ Pull data from qual survey
Tissue
Quality
Workflow
Adverse Events
Testing
Costs
Limit need for rebiopsy
■ Reduce costs associated with invasive and risky tissue biopsies3,6
Reduce spend to send-out laboratories
■ Dartmouth has achieved cost savings of 77% in direct variable costs compared with send-outs. When considering labor and other fixed costs, the hospital saved 39%1.
Leadership/ROI Market Differentiation
■ Attract/retain patients5,7
■ Improve relationships with payors/providers7
■ Recruit top talent7 ■ Increase clinical trial
referrals7
Accumulate Valuable Data
■ Research ■ ACO/Population health
Market Value
Data
Sources: 1. PierianDx. Why Are Other Healthcare Institutions Bringing Clinical NGS Testing In-House? PierianDx. https://www.pieriandx.com/news-room/learn-why-healthcare-organizations-are-insourcing-clinical-ngs-testing. Accessed April 19, 2019. 2. Using Multiplexed Assays of Oncogenic Drivers in Lung Cancers to Select Targeted Drugs. Jama. 2014 3. Genomic Profiling of Advanced Non-Small Cell Lung Cancer in Community Settings: Gaps and Opportunities. Clin Lung Cancer. 2017.
4. Comprehensive Validation of Cytology Specimens for NGS and Clinical Practice Expertise. 2018 5. The High Cost of Cancer Treatment. AARP. 2018. 6. Percutaneous Lung Biopsy: Technique, Efficacy, and Complications. Semin Intervent Radiol. 2013. 7. Determining Value of a Precision Medicine Program. Precision Medicine Summit. 2019.
ROI to Bring NGS Testing in House
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Survey of Early Adopters ROI to Bring NGS Testing in House
Reason for Insourcing NGS # of Institutions
Demand from clinicians 13
Anticipated efficiencies 12
Gain expertise in tech, informatics 9
Advance personalized medicine 7
Institutional stature 5
Value for research 5
Improved TAT for Molecular DX 4
Develop in-house expertise 3
Desire to provide leadership 2
Competitive market advantage 2
Reduce overall cost in clinical care 2
Most cited benefits from PierianDx customers
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Financial Data from Dartmouth ROI to Bring NGS Testing in House
“It does make financial sense to [insource]...The goal for our lab is to maintain the send-out volume at less than 5% and keep the send out costs at about 7-8% of the total operating costs for the lab.” Eric Loo Asst. Professor, Pathology & Lab Medicine
Source: “Bringing NGS Testing In-House.” PierianDx Webinar.
www.pieriandx.com
NGS Panel
Direct Variable Complete Cost If Sent Out
Myeloid ~$75,000 ~$215,000 ~$325,000
Lung ~$70,000 ~$175,000 ~$300,000
Melanoma ~$20,000 ~$50,000 ~$90,000
~$165,000 ~$440,000 ~$715,000
Savings 76.79% 38.57%*
To Lab To Institution *Dollar figures were altered for confidentiality. Savings are accurate.
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How to Bring NGS Testing In-House
Recommended Strategies
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What Your Lab Should Do Now
Amount of data to curate
Validation of clinical testing protocols
Scarcity of informatics expertise
Expense of implementation
Rapidly changing nature of technologies
Reimbursement Uncertainty
Test Validation
Pre-Launch Preparation
Training and Optimization
Institutional Approval
Initiate Planning
Procure Equipment Go-Live
How We Can Help
What We Have Learned
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Align with Your Larger Organization What Your Lab Should Do Now
“We fundamentally believe that genomically-informed clinical care involves strategic integration of the best genomic technology, with people and processes beyond the laboratory to realize the promise of precision medicine for each unique patient.”
Nikoletta Sidiropoulos MD, Associate Professor and Director of Molecular Pathology
Source: “Accelerating Your NGS Testing with an End-to-End Integrated Workspace.” PierianDx Webinar.
Identify key stakeholders and clinical areas Evaluate your organization, identify stakeholders and key strengths, secure funding, and develop a plan. Consider what other internal initiatives are synergistic. Take a multidisciplinary approach Collaborate with laboratory personnel, oncologists, bioinformaticians, and other staff to build a test menu that physicians want to order from Think about how data will be used ■ Align with research? ■ Biobank? ■ Integration with EMR or other phenotypic database? ■ Data warehouse?
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Clinical programming Examine Institutional Strengths
Research programs Informatics
Examine Institutional Priorities Clinical
programming Research & Education Market & Stature
Identify Clinical Need
Establish Business Plan Institutional Resourcing
Reimbursement Strategies
Research Resources
Prioritize Initial Clinical Applications
Develop Project Plan Timeline and Monitors Governance Outcomes
Measures
Obtain Institutional Approval
Implement
Unanticipated Resources
Monitor
Based on recommendations from the CAP Personalized Health Care Committee
Crawford, et al. The business of genomic testing: a survey of early adopters. Genetics in Medicine 2014
Align with Your Larger Organization What Your Lab Should Do Now
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Library Extraction,
Sample Prep Sequencing
Variant Calling (Bioinformatic
Pipelines)
Variant Annotation & Classification
Data Visualization, QC Analysis
Final Report & Medical
Director Sign-out
Data Integration
EMR, 3rd Party
Professional Dry Bench Wet Bench
Clinical Interpretation & Reporting
A CLIA/CAP certified lab is allowed to outsource any of the three components to another CLIA/CAP certified lab.
Consider a Distributive Model What Your Lab Should Do Now
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Take a Strategic Approach to Test Menu What Your Lab Should do Now
Today 3 Months 12 Months 2+ Years
All Solid Tumor
All Solid Tumor TSO 500
ArcherDx Myeloid
TSO 500
Lymphoid, Myeloid
TSO 500
ArcherDx Myeloid
6 Months
TruSight Cancer
In-House
Lab Services
Send-Out
Lymphoid, Myeloid
Solid Tumor
Hereditary
Liquid Biopsy
Liquid Biopsy
Hereditary Cancer
Hereditary Cancer
Heme
One Example
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Address the Interpretation Bottleneck What Your Lab Should Do Now
Interpretation of the clinical
significance of genomic alterations
remains the most severe bottleneck
preventing the realization of
personalized medicine in cancer.
Good, et al. Organizing knowledge to enable personalization of medicine in cancer. Genome Biology 2014
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Develop a Reimbursement Strategy What Your Lab Should Do Now
High Quality Test
Actionable Turnaround Time
Actionable Reporting
Clinical and Economic Evidence
Clinical Validity Clinical Utility Economic Utility
Coverage and Access
Guideline Inclusion Key Opinion Leader (KOL) Support
Key to Successful Commercialization Strategic development of clinical and economic evidence that clearly communicate the test’s value story Source: BHA Analysis
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Develop a Reimbursement Strategy What Your Lab Should Do Now
Payor Tool Description
Payor Coverage Presentation
30-min slide presentation which succinctly makes the case for coverage Shown to payor medical directors by payor relations group, medical science liaison, local KOL physician supporters
Payor Monograph, Dossier
White paper type document which explains issues with current treatment paradigm and describes the test’s impact on treatment
Payor Data Binder Binder containing the key supportive studies and clinical trial information
Cost/Budget Impact Models
Spreadsheet model which shows savings to payor or benefit to physician in financial terms over 2-3 year timeframe (i.e., avoided treatment costs, etc.)
Payor Profiling Database of account level information about major relevant payors which can be used to create account-specific tactics for driving positive coverage
Source: BHA Analysis
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Conclusion
1 Recent trends indicate increased NGS testing and in particular, Comprehensive Genomic Profiling.
3 Align, strategize on test menu and reimbursement, and consider distributing the workload.
2 Laboratories can increase quality, reduce costs, and gain expertise by insourcing clinical NGS testing.
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Technology Enabled Services Let us Help!
Laboratory Services Turnkey, validated assays and informatics
Validation & Interpretation Services Experienced team to fast-track growth
Medically Powered Knowledgebase The largest opt-in content sharing network
Clinical Genomics Workspace All-in-one informatics and reporting software
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Let Us Help! Building Your NGS Testing Program?
Chris Callahan Chief Operations Officer and Executive Vice President [email protected]
Resources Available www.pieriandx.com
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A Record Number of Personalized Therapies Recent Trends
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Pan-Cancer Biomarkers Approved Emerging
Microsatellite Instability NTRK Fusions (Vitrakvi) Tumor Mutational Burden
Recent Trends
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Comprehensive Genomic Profiling (CGP) Recent Trends
Source: Tsao AS, et al. J Thorac Oncol. 2016;11:613-638.
Slide courtesy of Illumina
Frequency of molecular aberrations in various driver oncogenes in lung adenocarcinomas and current available drugs against these oncogenic proteins.
+ TMB, MSI
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Recent Trends
Protecting Access to Medicare Act (PAMA) is ensuring that all codes on the Clinical Lab Fee Schedule are valued according to commercial payor rates Coverage and payment for those related to CGP and TMB will be driven by strength of evidence and Payor policy
Source: CMS CLFS, BHA analysis
2017 National Limitation Amounts 2018 National Limitation Amounts
Winners Losers
81162 BRCA
81206 BRC-ABL
81301 MSI
81275 KRAS
81210 BRAF
81235 EGFR
81311 NRAS
81445 GSP 5-50
81321 PTEN
81292 MLH1
81211 BRCA
81450 GSP 5-50
Heme
81298 MSH6
81295 MSH2
81455 GSP 51+
Reimbursement Tied to Evidence, Payor Policy
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Collaborate What Your Lab Should Do Now
Pathologist Oncologist
Diagnostic Predictive/CDx
6
1
Lung
Breast
Colorectal 5
18 Physician
Order Only
6 w/ Some Reflex
Testing
Most NGS testing is at the request of the oncologist or treating physician
2
1
Reflex testing employed in specific tumor types is a mix of single
biomarkers and panels
AMC Community
Many labs indicate NGS testing may be done at initial diagnosis or upon disease progression
depending on tumor type/stage
4 Upfront
15 Both 7 Disease progression
Timing of NGS Testing
Source: BHA analysis of qualitative interviews with 30 Pathologists and/or Lab Directors
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Develop a Reimbursement Strategy What Your Lab Should Do Now
Overview Goal Tools
Top Down (Policy level)
Direct engagement with key decision makers (Medical Director or Tech Assessment Influencer) Payor education for access expansion
Leveraging KOL support Driving policy change through evidence and/or guidelines inclusion
Positive coverage policy that can be leveraged by sales force as evidence of assured reimbursement
Payor value dossier/presentation, account profiling, etc.
Bottom Up (Claims level)
Working at the grassroots level to ensure each test request is bolstered by supporting medical necessity documentation
Managing/Guiding prior authorization requests with physicians
Align with payor on preferred coding approach (e.g., code stacks vs. GSP codes) Leveraging denied/claims paid to create enough interest in test to encourage Payors to generate a policy and pay for the test
Maximize the number of claims paid, build interest in the test at Payor level
Medical necessity documentation, appeals
A defined coding strategy: Z-codes should be applied for in advance
Source: BHA Analysis