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Opportunities and Challenges Associated with Novel Companion Diagnostic Technologies


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L.E.K. Managing Director Alex Vadas spoke at a BDA workshop on "How to Mature Emerging Technologies into Companion Diagnostics?" See his presentation here.

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Opportunities and Challenges Associated with Novel Companion Diagnostic Technologies

  1. 1. Bangkok Beijing Boston Opportunities and challenges associated with novel companion diagnostic technologies Chennai December 12, 2013 Los Angeles Chicago London Melbourne Milan Mumbai Munich New Delhi New York Paris San Francisco São Paulo Seoul Shanghai 21st Floor, L.E.K. Consulting LLC, 1100 Glendon Avenue, T: 310.209.9800 F: 310.209.9125 Los Angeles, CA 90024, USA Singapore Sydney Tokyo © 2013 L.E.K. Consulting LLC. All rights reserved. Wroclaw
  2. 2. L.E.K. introduction L.E.K. Consulting is a leading global strategy consulting firm Global Network Overview Established in 1983 Clients include 25% of the largest 200 companies globally, as well as innovative start-ups and leading private equity firms Areas of expertise include: Strategy Transaction Services Finance Marketing and Sales Operations Organization London San Francisco Los Angeles Chicago Paris Boston New York Wroclaw Milan Munich Seoul Beijing Tokyo Shanghai New Delhi Mumbai Bangkok Singapore Worldwide more than 900 professionals, led by 100 Vice Presidents in 20 offices In North America more than 350 professionals, led by 40 Vice Presidents, all heavily involved in delivering client assignments São Paolo Sydney Melbourne Auckland CONFIDENTIAL 1 © 2013 L.E.K. Consulting LLC. All rights reserved.
  3. 3. Emerging CDx technologies The big four established players (Roche, Qiagen, Dako and Abbott) have historically been pharma’s CDx partners of choice IVD company CDx partnerships (2005 – present) Percent of total (# of total deals = 86) 31 100 18 7 30 90 Abbott 80 Dako Qiagen 70 60 50 BioMerieux Cepheid 40 30 Hologic Life Tech Asuragen MDxHealth Nanosphere Sequenom 20 10 Leica Other - emerging Incell 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90 95 100 qPCR Source: Other - established BG Medicine Luminex Meso Scale Discovery Saladax Sysmex (Inostics) Veridex 0 0 Roche Alere Beckman Coulter BioMerieux GE Life Technologies Ortho-Clinical Siemens IHC FISH / ISH FDA, company websites, L.E.K. analysis Other / Undisclosed CONFIDENTIAL 2 © 2013 L.E.K. Consulting LLC. All rights reserved.
  4. 4. Emerging CDx technologies Biomarker trends are driving the need for novel technologies in CDx Example biomarker trends  Sample access and analysis:  Peripheral detection (e.g., for CTCs or ctDNA)  Multiplexing (e.g., NGS, NanoString, protein arrays, CyTOF)  Multi-omic (e.g., RNA FISH, RNA flow, MultiOmyx)  New detection modalities (e.g., methylation-specific PCR)  POC / near patient Sample access / availability limitations Single cell analysis Sub-population analysis Systems biology Small fold changes Absolute quantitation Single molecule detection Biomarker modifications (phosphorylation, methylation) Broadening applications: - Patient acquisition (rare patient ID, diagnosis, Rx selection) Source:  Exploration of nuanced biology:  CDx technology needs Monitoring Beyond oncology (e.g., ID, neuro, AI) L.E.K. analysis CONFIDENTIAL 3 © 2013 L.E.K. Consulting LLC. All rights reserved.
  5. 5. Emerging CDx technologies Most novel technologies reside within emerging companies or companies with emerging diagnostics capabilities (acquisitions are expected) Example Emerging CDx Technologies Emerging Platforms / Examples NGS  Illumina Peripheral detection Multiplexing Multi-omic Novel detection  Qiagen  Life Digital PCR  Life  RainDance Arrays  Inostics / Sysmex  Bio-Rad  NanoString  Boreal Genomics Epigenomics  MDxHealth  Epigenomics Digital immunoassay  Singulex Proteomic arrays  Aushon  MSD  Luminex  Theranostics CTC  Quanterix  Veridex  BioCept Emerging cytometry  DVS RNA FISH / Flow  ACD  Affymetrix Multi-omic histology Source:  GE / MultiOmyx L.E.K. interviews and analysis CONFIDENTIAL 4 © 2013 L.E.K. Consulting LLC. All rights reserved.
  6. 6. Emerging CDx technologies Most emerging companies lack a range of important CDx capabilities; even emerging technologies within established companies may lack infrastructure and logistics support Novel CDx technology partner strength Emerging technology Emerging company CDx partner selection criteria CDx development capabilities Technical capabilities and expertise Emerging technology Established company Core competency Novel test development experience Therapeutic area expertise Regulatory experience Operational and commercial infrastructure CE / 510(k); rarely PMA Testing infrastructure / installed base Initially limited Manufacturing infrastructure Pricing and reimbursement Sales and marketing Logistics support Company background Outside of competency Global footprint Financial health BioPharma partnering experience Relative strength Source: L.E.K. analysis High Moderate Low CONFIDENTIAL 5 © 2013 L.E.K. Consulting LLC. All rights reserved.
  7. 7. Emerging CDx technologies CDx access is a significant issue even with established technologies; access solutions will be critical when working with emerging technologies Directional Advanced NSCLC patients Percent not tested Drug and test awareness Negligible Key risks for emerging CDx technologies:  Sample accession 15-20% Lab access Testing and reporting 5-10% Drug utilization Negligible Reimbursement Test requires significant sample Test requires non-standard sample (e.g., fresh tissue in the U.S.) 0-5% Total Source: 0-5% - 5-10% Test ordering Sample access: 25-50% L.E.K. analysis  Lab access:  Limited installed base Central lab model Lack of sample logistics support Lack of established reimbursement CONFIDENTIAL 6 © 2013 L.E.K. Consulting LLC. All rights reserved.
  8. 8. Emerging CDx technologies A range of mitigating strategies may be considered (typically customized for each situation): Platform risk Clinical labs Partner network Partnering excellence  Work with novel reagent companies compatible with cleared platforms  RNA FISH / Flow (e.g., ACD, Affymetrix) qPCR (e.g., MDxHealth, Epigenomics, Asuragen) dPCR (Sysmex / Inostics; leverages qPCR and flow) Work with labs across the R&D and commercial value chain (build, partner, finance, acquire): - Technology access (e.g., Myriad, Foundation Medicine) Site-specific PMAs for accelerated timelines, reduced regulatory risk and lower costs Commercial support including logistics, S&M, reimbursement (multiple across regions)  Pre-analytical / channel partners for sample access and logistics (e.g., BD, GE Healthcare)  Coalition / consortium efforts with other pharma and stakeholders (e.g., Foundation Medicine Master Protocol)  Appreciation of partner value drivers, needs and capabilities  Coordination across multiple partners CONFIDENTIAL 7 © 2013 L.E.K. Consulting LLC. All rights reserved.