Diagnostics, Payers

Color secures widespread coverage for its hereditary cancer test

Is hereditary cancer screening really worth it for the general population? Increasingly, the answer is ‘yes.’

Color Insurance_Provider Portal_HiRes

Color’s insurance provider portal

Is hereditary cancer screening really worth it for the general population? Increasingly, the answer is ‘yes.’

As proof, look no further than Burlingame, California-based Color. Starting June 15, the 2013 startup will begin accepting health insurance for its flagship 30-gene hereditary cancer test.

Announced Monday, the coverage comes through a new partnership with some of the largest payers in the U.S. The deal includes mega-insurers such as United Healthcare, as well as regional players like Blue Shield of California. Combined, the organizations provide healthcare coverage for more than 120 million Americans.

So what makes Color unique?

It’s not the technology or the test. Myriad Genetics’ myRisk Hereditary Cancer test looks at 28 genes that influence a person’s risk for the same eight cancers; breast, ovarian, colorectal, pancreatic, uterine, melanoma, prostate and stomach.

According to Darrin Crisitello, Color’s VP of global sales, marketing, and operations, the company’s greatest differentiator is its price point.

“Typically these tests have been very very expensive, in fact, cost-prohibitive for most patients,” Crisitello said. “So much so, that insurance companies have put very strict criteria in place that people need to meet in order for them to cover the testing.”

By keeping the work in-house and taking the regulatory route of a laboratory-developed test (LDT), Color is able to offer its clinical-grade testing service at a self-pay rate of $249.

By comparison, Myriad’s earlier BRCA1 and BRCA2 test carried a list price of $4,000, triggering public outcry at a time when genomic sequencing costs were plummeting. That has now been replaced by its eight cancer test, which sells for $4,000-4,500.

The price difference is emblematic of a wider philosophical difference. Myriad previously had exclusive rights to the BRCA1 and BRCA2 test. It’s a pioneer of sorts. However, the high cost heavily restricted its use.

Color came on to the market with an aim to offer genetic testing at a much lower price point, thereby making it accessible to everyone — not just high-risk populations.

Starting out, it too focused on BRCA1 and BRCA2, the genes made famous by Angelina Jolie who had a preventive double mastectomy when she tested positive for associated mutations.

In the U.S., between 1 in 400 and 1 in 800 people have a BRCA1/2 mutation, according to the Susan G. Komen organization. A positive BRCA1 result gives a woman a 60-80 percent lifetime risk of breast cancer and a 30-45 percent lifetime risk of ovarian cancer. A positive BRCA2 result gives a woman a 50-70 percent lifetime risk of breast cancer and a 10-20 percent lifetime risk of ovarian cancer.

Over time, more evidence has been filed against other cancer-causing genes. Color has kept to the one product (with gender-specific analyses), but it has expanded to include other forms if the disease.

If the company does its job right, it will be delivering bad news to around 1-2 percent of its customers. (Crisitello noted that genetic screening companies tend to detect slightly higher rates of mutations than are found in the general population, due to self-selection.)

But it’s not really about bad news. Color has always sought to deliver meaningful and actionable information. Whatever patients choose to do, early warning about a serious cancer risk can help them better manage their health. Whether that means preventive surgery or simply an intensive program for screening, there is value for the patient and apparently, value for the insurer.

Next in Color’s sights: the Centers for Medicare and Medicaid Services (CMS).

Photo: Color