Payers, Diagnostics

What ever happened to the NantHealth-Independence Blue Cross sequencing partnership?

In January 2016, Independence Blue Cross and NantHealth announced the nation’s first coverage for a whole genome sequencing and proteome molecular diagnostic platform, but it’s mostly slipped under the radar since then. What’s going on?

More than two and a half years ago, health insurer Independence Blue Cross and NantHealth announced that Independence would cover NantHealth’s whole genome and proteome molecular diagnostics platform, GPS Cancer.

The Jan. 11, 2016 announcement was notable in that it marked the nation’s first insurance coverage for such a platform. However, the progress made since then by the Philadelphia-based insurer and the Culver City, California-based healthcare firm — led by controversial billionaire Dr. Patrick Soon-Shiong — does not appear consistent with the hype.

One genomics industry executive said in a phone interview that he had not heard of anyone in the Philadelphia marketplace who had ordered the test under the partnership, although he wasn’t entirely sure.

Another echoed the sentiment.

“That wouldn’t surprise me,” said Nancy Spinner, the chief of the Children’s Hospital of Philadelphia Division of Genomic Diagnostics,  in a phone interview. While not privy to information about progress under the partnership, Spinner said the proposal from NantHealth and Independence was greeted with skepticism from the scientific community.

After several attempts to contact NantHealth, spokeswoman Jen Hodson said in an email that the company has, in fact, sequenced patients under the agreement with Independence. However, she said that as a matter of policy, the company does not release numbers regarding specific payers or providers.

Independence’s Chief Medical Officer Richard Snyder said in an email that since the insurer began offering the test in March 2016, doctors have ordered — and Independence has paid for — “a small number of tests.”

Snyder noted that the test is only available to fully insured commercial members in Pennsylvania. The insurer serves 2.5 million people in southeastern Pennsylvania, though not all are necessarily eligible for coverage under the NantHealth partnership. Together with its affiliates, Independence covers 8.5 million across 28 states and the District of Columbia.

The partnership covers tumors in children, rare cancers, metastatic cancers of unknown primary, primary brain cancer, triple-negative breast cancer and metastatic cancers that have exhausted conventional therapies among patients for whom further therapy is recommended, according to the Jan. 11, 2016 release.

The press release also pointed out that the Chan Soon-Shiong Institute of Molecular Medicine at Windber would be in charge of collection and storage of specimens. CEO Tom Kurtz did not respond to a call and emails requesting comment.

While the status of how many Independence members have undergone sequencing under the partnership is unclear, the California company’s financial reports do state how many GPS Cancer tests have been ordered nationwide. The company reported 642 orders for the test in the second quarter. That was down slightly from the 677 orders in the first quarter of this year, but well above the 379 ordered in second quarter of 2017.

Revenue from sequencing and molecular analysis increased to $924,000 in the second quarter, up from $450,000 in the same period a year ago. However, this year’s second quarter revenue of $924,00 appears to have benefitted from 266 orders for NantHealth’s Liquid GPS test in addition to revenue from the GPS Cancer test. The company’s quarterly and annual financial reports do not refer to the Independence partnership by name, but reference a January 2016 partnership involving coverage for GPS Cancer with “a large health plan.”

Since the Independence-NantHealth partnership was announced, numerous other companies in the next-generation sequencing space — Thermo Fisher Scientific, Foundation Medicine and Illumina, to name a few — have come to dominate the market.

Foundation Medicine reported 44,852 comprehensive genomic profiling tests for clinical use to ordering physicians during the first half of 2018, including 6,274 FoundationOne CDx tests, drawing $42.6 million in clinical revenue. FoundationOne CDx became the first comprehensive genomic profiling test to win Food and Drug Administration approval in November 2017, and in June Roche said it would spend $2.4 billion to purchase the remaining shares in the company it didn’t already own.

Nevertheless, Bloomberg reported on April 24, 2017 that despite NantHealth reporting that it had seen 670 “commercial orders” of the test in the second half of 2016, the news service could only confirm that six tests were ordered and paid for, all by Sanford Health. Hodson, the NantHealth spokeswoman, told Bloomberg that any tests not ordered by payers would have been ordered by community oncologists. Bloomberg concluded that the company was giving away most of the tests, whose unit price the news service quoted at $11,000. Independence declined to comment for their story.

Four days after the Bloomberg report in the spring of 2017 appeared, however, it reported that Teva Pharmaceutical Industries bought 97 tests.

In NantHealth’s fourth quarter 2017 earnings call, Chief Medical Officer Bobby was asked about the progress of the Independence partnership. Reddy responded that training of doctors was ongoing and improving, and that volumes of orders had increased across the board by the month and by the quarter, with some “coming particularly in those areas.”

While specific details remain scant, the deal between Independence and NantHealth is an outlier in terms of how it was promoted, said Robert Dumanois, manager for reimbursement strategy in Thermo Fisher’s clinical NGS division. He pointed out that recent NantHealth investor presentations list several payers as clients. Yet, Independence and Sanford appear to be the only ones that have made significant announcements, he said.

“I would say that at a minimum, NantHealth is aggressive with promotion,” he said in a phone interview.

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