FDA approves Foundation Medicine’s genetic diagnostic test as CMS paves the way for coverage

FDA approves the first-of-its-kind large-panel genetic diagnostic test from Foundation Medicine with CMS offering a preliminary National Coverage Decision on it. Commercial insurers so far have preferred to cover diagnostics tests that target a single or a handful genes.


A little over two months after it was hinted that good regulatory news maybe headed Foundation Medicine’s way, the company announced late Thursday that the FDA had approved the company’s genomic diagnostic test for all solid tumors.

In parallel, the Centers for Medicare and Medicaid Services also issued a preliminary National Coverage Decision to cover the FoundationOne companion diagnostic test. Per the company’s news release the “draft NCD would provide coverage for FDA-approved companion diagnostic claims, as well as a pathway for additional coverage with evidence development in other solid tumor types.”

A final policy is expected to be issued in the first quarter of next year after an administrative period and to allow for public comment. It will be interesting to see how insurers view this development.

In August 2016 the Cambridge, Massachusetts- based Foundation Medicine announced that it’s FoundationOne test had been accepted into the Parallel Review program.

For those who are unaware, Parallel  Review is a program that companies can undergo to simultaneously seek FDA approval and CMS National Coverage Decision for a novel product. The first example of this was Exact Sciences and its Cologuard product, which got FDA approval in 2014.

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A Deep-dive Into Specialty Pharma

A specialty drug is a class of prescription medications used to treat complex, chronic or rare medical conditions. Although this classification was originally intended to define the treatment of rare, also termed “orphan” diseases, affecting fewer than 200,000 people in the US, more recently, specialty drugs have emerged as the cornerstone of treatment for chronic and complex diseases such as cancer, autoimmune conditions, diabetes, hepatitis C, and HIV/AIDS.

The value of FoundationOne lies in its potential to further precision medicine in the field of oncology. It asses genomic alterations in 324 genes and can suggest a treatment path based on what the DNA sequencing reveals. The test is also indicated as a companion diagnostic for patients with certain types of non-small cell lung cancer (NSCLC), melanoma, colorectal cancer, ovarian cancer or breast cancer to identify those patients who may benefit from treatments currently available.

Covering a large-panel gene test might be the way forward to tackle cancer, the FDA noted in its announcement.

Compared to other companion diagnostics previously approved by the FDA that match one test to one drug, the F1CDx is a more extensive test that provides information on a number of different genetic mutations that may help in the clinical management of patients with cancer.

An expert addressed how large-panel gene testing is key to precision medicine.

“Comprehensive genomic profiling is the gateway to precision medicine. This decision from the FDA and CMS, which may lead to coverage for Medicare patients, represents an important step forward in improving patient and clinician access to precision medicine – both in setting a new quality standard for this type of testing and offering potentially improved healthcare coverage,” said Ankur R. Parikh, DO, Medical Director of Precision Medicine, Cancer Treatment Centers of America.

The CMS preliminary decision is likely going to force insurance companies to reevaluate how they look at the efficacy of large-panel gene testing. While oncologists are prescribing such tests, many insurers refuse to cover them often leaving patients with large bills. So far, they have preferred to take an incremental approach to precision medicine by covering tests that target one or a handful of genes at the most.

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