Inside the Diagnostics Industry: Sequencing Continues Making Headlines, Though Panels Will Dominate in Short Term

Rapid incorporation of sequencing into clinical practice is stirring excitement in the molecular diagnostics industry, but in reality this method faces some hurdles. The emerging clinical applications of sequencing-based tests, as well as frank discussions of some of the challenges, were discussed at G2’s MDx NEXT conference (Baltimore; June 11-13). Through the two-day conference, some dominant themes emerged. Sequencing Grabbing Headlines Sequencing will revolutionize the practice of molecular diagnostics, if it has not already. Yes, there are regulatory and reimbursement challenges ahead, but the technological aspects of next-generation sequencing (NGS) have largely been conquered. Now, attention is increasingly being focused on the remaining practical undertaking of making sense of the vast quantities of sequencing data. The point was repeatedly made that the biggest barrier to widespread clinical adoption of sequencing is data interpretation. There was both optimism and enthusiasm regarding the number of firms tackling the bioinformatics and analysis components of interpretation and the progress these startups are making. Expert stakeholders across the diagnostics industry highlighted the growth potential among this segment of the industry. The enthusiasm for all things sequencing is additionally buoyed by the seemingly daily headlines touting sequencing achievements, even in the lay media. The week of the conference, the New England Journal of Medicine published a case report (that was also heavily reported in lay media) of NGS making an “actionable diagnosis” of a life-threatening infection, a diagnosis that ultimately saved a 14-year-old boy’s life. The boy was put into a medically induced coma after being hospitalized for six weeks with a brain-inflaming encephalitis. A rapid bioinformatics analysis pipeline, developed by Charles Chiu, M.D., Ph.D., at the University of California, San Francisco (UCSF), called SURPI (sequence-based ultra-rapid pathogen identification) was able to streamline “genetic sleuthing” of disease pathogens, enabling rapid sequencing and simultaneous identification of all DNA in the patient samples without culturing or targeting for specific infectious disease agents, thus dramatically cutting the time between sample collection and diagnosis. In this case it took 48 hours from cerebrospinal fluid (CSF) sample receipt to diagnosis of a Penicillin-treatable, bacterial infection. SURPI created a library of 10 million distinct DNA sequences from samples of the patient’s CSF and blood, and from a control sample. Using a MiSeq DNA sequencer (Illumina) the researches discovered that 475 distinct DNA sequences among the 3 million DNA sequences in the patient’s CSF came from Leptospira bacteria. No Leptospira was detected in the patient’s blood. Analysis of the DNA sequences took just 96 minutes, with SURPI providing an answer that an extensive infectious disease workup was unable to determine. Seven days after initiation of penicillin, the patient was discharged. “Until now NGS has been regarded as too slow and laborious to be useful for routine infectious disease diagnosis,” said study co-author Joseph DeRisi, Ph.D., chair of biochemistry at UCSF, in a statement. In this case, an experimental diagnostic protocol was utilized in a CLIA-certified clinical lab, but Chiu said that within a few months he expects to obtain approval to offer an NGS-based diagnostic test at the UCSF clinical microbiology laboratory for diagnosis of certain types of infectious diseases. Besides continued development of rapid bioinformatic workflow techniques, appropriate reimbursement will foster larger demployment of NGS tests in routine clinical practice. Jorge Leon, Ph.D., president of Leomics Associates consulting firm, told the MDx NEXT crowd that he is hopeful reimbursement will begin in earnest for NGS tests in 2015. He predicts adoption of NGS to be the fastest-growing genomics platform for the next 10 years, a segment with potential new revenue of $3 billion to $4 billion. Growth of NGS Panels As industry experts continue to explore the growing applications of NGS, a healthy tension is apparent between the possibility of using whole-genome and whole-exome sequencing, which are notable for their cost efficiencies but yield excessive data of uncertain clinical significance, and single-gene analysis of targeted mutations with known clinical significance. While there have been notable success stories of the application of whole-genome and whole-exome sequencing to end diagnostic odysseys, current consensus is that NGS panels will dominate the sequencing landscape for the foreseeable future. According to data unveiled for the first time at the conference by the genetic test marketplace NextGxDx (Nashville, Tenn.), the move toward utilization of panels, rather than single-gene analysis, is clearly under way. In the first five months of 2014, 1,085 new molecular tests were released, including 362 panels, a dramatic increase in the percentage of tests released as panels over previous years, Mark Harris, Ph.D., NextGxDx’s CEO, told conference attendees. “Payers want to see how to reduce the costs of tests currently being used and they want to reduce the redundancy of tests,” said Leon of Leomics Associates. “If an NGS panel will report with the same or increased accuracy and the test has added value because of extra genes being tested, they would like to see that. But the big question is, are the added genes affecting outcomes. We need to show that in real patients.” Sherri J. Bale, Ph.D., managing director at GeneDx (a subsidiary of Bio-Reference Laboratories; Gaithersburg, Md.), offered some practical considerations for laboratories to consider when developing panels. For instance, she said there is still the expectation that there is 100 percent coverage of all nucleotides on panels. In reality, though, Sanger sequencing for LC/LQ regions is often required. Additionally, she cautioned that you can’t add a new gene to an existing panel “on the fly.” Changing a panel can take four to six months and $100,000 to revalidate. Despite some imperfections, panels, she says, are still a good approach for complex phenotypes. Transparency, Workflow Improvements Needed With increasing reliance on panels comes the challenge of making comparisons between tests—a particular challenge for ordering clinicians. The emphasis on transparency in molecular testing is permeating beyond just the payments realm and needs to be addressed during the test ordering process, Harris says. His company, NextGxDx, provides such a solution. NextGxDx provides a comprehensive online marketplace for genetic testing. The number of commercially available tests for genetic diseases is increasing at a pace—50 tests per week, NextGxDx says—faster than hospitals and physicians can keep up with. Furthermore, researching and ordering these tests can be a cumbersome process, which can take hours of a physician’s time. The NextGxDx tool enables clinicians to access up-to-date listings of all genetic tests from CLIA-certified laboratories, order tests online, and receive results electronically. The company has a goal of including molecular test information from all U.S.-based CLIA-certified laboratories. The company collects test information, and cleans and standardizes testing information, making comparisons based on included variants, turnaround time, and price possible. NextGxDx streamlines this process and takes it one step further by simplifying ordering too. Harris says a typical hospital can order tests from 25 to 45 different laboratories, with only the largest laboratories’ requisition forms (AmbryPort, ARUP Connect, Baylor GeneResults, LabCorp Beacon, Mayo Access, Quest Care360) integrated into electronic health record systems, thus necessitating the use of error-prone, time-consuming, hand-written forms for the rest. “The goal of a marketplace is to create transparency. For industries ranging from air travel to electronics, online marketplaces have demonstrated the ability to improve overall product quality and customer service,” the company says. “This is done by providing a way for users to easily compare important ordering-related information for all available products in one place.” NextGxDx incorporated elements from consumer goods models—PayPal with a secure checkout and payment system in fragmented markets; Amazon, which consolidates vendors to provide a comprehensive catalog; and Walmart with one-stop, low-cost shopping. NextGxDx receives a per-test transaction fee for any tests ordered through the platform. Health care providers will never have to pay to access the marketplace. The company has nearly 20,000 products in its catalog. Takeaway: As clinical NGS permeates more practice areas, attention and enthusiasm are increasingly focusing on bioinformatics and analysis solutions. Side Box: Roche Snaps Up Sequencing Firm In a move meant to strengthen its diagnostics pipeline after its failed bid to buy Illumina, Roche (Switzerland) acquired U.S. gene-sequencing firm Genia Technologies (Mountain View, Calif.) for up to $350 million ($125 million paid immediately and $225 million contingent on achieving milestones). Unlike Illumina’s platform, Genia relies upon nanopore technology. Genia, more specifically, relies on semiconductors to measure changes in electrical currents, capable of measuring single molecules, while its NanoTag chemistry, the company says, enables more accurate base calls than other nanopore-based platforms. Analysts say the acquisition is an important long-term play for Roche. In addition to enhancing the strength of its diagnostics portfolio pipeline, Genia’s technology can also potentially be used in development of targeted therapeutics. Side Box: Partnership to Expand Solid Tumor Mutation Panel Providing further evidence for clinical interest in molecular panels, Memorial Sloan-Kettering Cancer Center (MSK; New York) and Quest Diagnostics (Madison, N.J.) announced a partnership in June to enhance Quest’s OncoVantage sequencing-based panel. The first phase of the collaboration will be evident this summer with the launch of a cobranded clinical annotation report. The panel’s analysis of 34 genes from solid tumor biopsy samples will be merged with MSK databases, correlating specific mutations to patients’ prognosis, treatment selection, and monitoringof disease progression. This real-time data exchange, the companies say, will enable rapid translation of discoveries into clinically actionable information for cancer care. The second phase of the collaboration will involve codevelopment of an expanded test potentially analyzing hundreds of genes. Launch of this test is anticipated in spring 2015.