“We’re all about overwhelming force and narrow markets,” OncoCyte president and CEO Ron (Ronnie) Andrews says of the molecular diagnostics developer he has helmed since July 2019, “because we really can’t afford to play in multiple markets as a small company.”
OncoCyte has demonstrated some of that proverbial firepower and focus lately. On January 13, the company announced the U.S. commercial launch of DetermaRx, a 14-gene molecular stratification test designed to enable identification of Stage IA, 1B, and IIA non-squamous non-small cell lung cancer (NSCLC) patients who may benefit from adjuvant chemotherapy post-surgical resection.
DetermaRx was known as the “Razor test” until OncoCyte renamed it after acquiring Razor Genomics for at least $11 million in September 2019, soon after the test won a positive reimbursement recommendation by the Centers for Medicare & Medicaid Services (CMS).
Three days before the DetermaRx U.S. launch announcement on January 10, OncoCyte signaled its intent to broaden its lung cancer test menu when it agreed to acquire privately held Insight Genetics for approximately $12 million—$7 million cash, $5 million in OncoCyte common shares. Insight Genetics’ offerings consisted of targeted therapeutic panels that include two emerging therapeutic targets, RET and NTRK, as well as the Immune Modulation (IM) Score, a gene expression test designed to measure the state of the immune system in biopsies from cancer patients to identify patients more likely to respond to PD-1/PD-L1 immunotherapies.
At the Society for Immunotherapy of Cancer’s 34th Annual Meeting (SITC 2019), held November 7–10 in National Harbor, MD, Insight Genetics presented data showing a strong association of the IM score immuno-diagnostic test for therapy selection—since renamed DetermaIO—with response to PD-1/PD-L1 targeted immunotherapy in lung cancer. Data to date has shown consistent results in three major I/O drugs studied: Merck & Co.’s Keytruda (pembrolizumab); Bristol-Myers Squibb’s Opdivo (nivolumab); and AstraZeneca’s Imfinzi (durvalumab).
DetermaIO showed superiority over two currently marketed predictive companion diagnostic tests for immunotherapy selection, PD-1/PD-L1 IHC staining and tumor mutational burden (TMB), according to OncoCyte.
“Our P value was 0.002 at discriminating responders from non-responders. PD-L1 was 0.2 and tumor mutational burden was 0.99,” Andrews told Clinical OMICs in an interview during the recent J.P. Morgan 38th Healthcare Conference, held in San Francisco. “Those data allowed us to really see clear differentiation between responders and non-responders, and was really sort-of the catalyst, not only for us getting interested in buying Insight Genetics, but also the catalyst now for pharmas to call us and begin to want to work with us.”
Final IO data is set to be published at upcoming meetings of the American Association for Cancer Research (AACR) and American Society of Clinical Oncology (ASCO).
“When we saw the data in lung cancer, it was incredibly positive, in terms of its ability to predict responders and non-responders to immune therapy. So, I petitioned the board, and said, Hey, this is something we need to pursue now before the news gets out and it becomes a very expensive company. So, the board said, Yeah, let’s go do it. And so, we were able to work a deal,” Andrews added. “We’re very excited to have acquired it. We’re really looking forward to getting out there with pharmas and beginning to develop [DetermaIO] for our patients.”
Andrews served as CEO of Clarient before its 2010 acquisition by GE Healthcare for approximately $580 million, then CEO of the buyer’s Molecular Diagnostics business before later serving as president of the Genetic Sciences Division of Thermo Fisher Scientific. Between those positions and his current post as OncoCyte CEO, Andrews was founder and senior partner of the C-suite consulting team The Bethesda Group, which worked with Insight Genetics for several years, following its work in triple-negative breast cancer.
“We had identified an I/O arm that was really positive in some early data, and as a consulting team, we helped them [Insight Genetics] take it to the clinic and get some deeper trials in places like MD Anderson and West Clinic. And lo and behold, it hit its endpoint, and did very, very well compared to PD-L1, and very well against TMB,” Andrews recalled.
In addition to closing its purchase of Insight Genetics and reporting further DetermaIO data in triple-negative breast cancer, Andrews said, OncoCyte’s busy agenda for 2020 includes beginning enrollment for a clinical utility trial for DetermaRx, obtaining CMS’ final “local coverage determination” (LCD) on pricing for DetermaRx—at which point the company will be able to predict revenues for this year—as well as further development of DetermaDx™ a liquid biopsy test, including initialization of a clinical utility study.
DetermaDx uses a proprietary immune system interrogation approach designed to clarify if a patients’ lung nodules are benign, which may enable them to avoid potentially risky invasive diagnostic procedures.DetermaDx is being assessed in Immune Response for Nodule Evaluation (IRENE), an ongoing clinical validation study with more than 2400 subjects being evaluated across 62 sites including both academic and community practices. The largest reported cohort consists of participants with pulmonary nodules 5–30 mm, intended to be representative of the U.S. patient population.
Pricing and partnerships
“We’ll finish clinical validation for DetermaDx and we’ll publish that data, and that data will get us to our dossier. We’ll submit the dossier for CMS approval for DetermaDx in the fall, and then we’ll wait to get a response from them,” Andrews said.
Being a smaller company, he said, OncoCyte wants to start with tests for lung cancer, then breast cancer. However, all of OncoCyte’s tests could potentially be used across other tumors. Over time, the company aims to expand the types of cancers it can diagnose—potentially through future partnerships with biopharmas, another of OncoCyte’s priorities for 2020.
“What we will do is partner and do research in these other tumors with our test, and then if we get endpoints that we hit in those other areas of cancer beyond lung, we will either license that to company selling in that space, or if it’s compelling enough, we might add a sales force to go selling in that area,” Andrews said. “We expect to see immune-oncology pharma partnerships emerge in late Q1 or early Q2.”
Within those quarters, OncoCyte also expects to record its first revenue from DetermaRx,which is now in early access sites. The company has hired six sales representatives–one for each of the top U.S. regions for lung cancer treatment—who will market the test to thoracic surgeons. That’s no mean number for a company whose current staff size is 32, plus additional consultants.
“Our goal is as each rep gets to be about $1.5 million to $2 million in run rate. We’ll actually then add the next rep adjacent to them, the next territory,” Andrews said.
He said previous companies he worked with went from 8 to 16 to 24 sales reps over about four years—a pace that OncoCyte hopes it will be able to need. If DetermaDx gets early approval in 2021, OncoCyte “will probably add some reps around that, because that’s a pretty big market opportunity, and we don’t want to miss that window,” Andrews added.
A recent visit to a Southern California physician reinforced Andrews’, and OncoCyte’s, determination to make the most of that opportunity.
“I was presenting the dataset to get his feedback,” the CEO recalled. “He said, ‘Stop. I already know the story. I have a patient who I did surgery on a little over a year ago. She was in my office yesterday, has metastatic disease. She’s going to die in six months. I need this test in my office today. How do I get it?’”
“They see these patients in their practice. They just didn’t know how to classify them,” Andrews observed. “And now that there’s a classifier out there, they want to be able to use it because they want to see these patients live.”