During the coming holiday season, consumers looking for a last-minute gift card on the checkout line might be able to decide if the recipient might prefer products from iTunes, Amazon, Applebee’s, or PAML. That’s the ambition of one of the largest labs in the western United States. The Spokane-based PAML is launching a significant rebrand and expansion of its direct-to-consumer testing business that should be fully in place by the fourth quarter of this year, according to its chief executive officer, Francisco Velázquez, M.D. One of the cornerstones of this strategy is gift cards that could be used to purchase a lab panel much in the same way consumers currently download songs or buy outdoor furniture online with relative ease. PAML’s reach for the direct-to-consumer business comes at a time when it remains a final, and often rugged, frontier for labs: chockablock with uncertainty, if not hostility, and haunted by the possibility of large losses. The prospects scared off industry giant Quest Diagnostics, which refocused products it had marketed toward individuals to capture employer groups instead. But Velázquez sees it differently. He noted that PAML’s consumer sales are up 50 percent between 2008 and 2012, although it remains a tiny portion of the lab’s overall revenues. That appears to be in line with a gradual but consistent growth of the consumer testing market, which is known as direct-access testing or direct-to-consumer testing. Although it’s still microscopic in volume when compared to the entire lab sector, data from G2 Intelligence suggest it’s growing as much as 20 percent a year. In PAML’s case, the demographics have been telling: Most of the new users are women between the ages of 18 to 40 and males between the ages of 30 and 50. Indeed, PAML has engaged in such deep market research that Velázquez’s observations on patient preferences seemed to have been lifted whole from a television programming or fast food chain exec’s playbook. “Those within the . . . 18 to 35 age group share vastly different preference patterns for [data] acquisition, and this type of consumer relies a lot more on the virtual world in order to do so,” Velázquez said. Add to that the ever-growing out-of-pocket costs for consumers. The average deductible for all health plans topped $1,000 a year in 2012, according to data from the Kaiser Family Foundation—nearly double what it was in 2006. And a third of those surveyed in a recent Kaiser tracking poll said they or a family member had relied on over-the-counter products in the past year because going to the doctor is too costly. Expanded Offerings As a result, PAML has spiffed up the Web site for its consumer business, which is known as Results Direct™, and expanded its offerings. It currently offers more than 50 tests. Specimens are gathered at a local service center and sent in for testing. The tests range in price from less than $20 for a blood count screen to urinalysis for drug use to $175 for an adult food allergy panel. Gender-specific general health panels are $125. “As we see the higher out-of-pocket expenses, and we see more employers going into defined contributions, and people engaged in more health and well-being products, this seemed like the next logical step,” Velázquez said. “We have comprehensive panels, basic metabolic profiles, and tests for cholesterol, iron, anemia. These are aimed at the type of traditional wellness factor that people want to monitor and follow up with.” He also noted that ordering tests directly from the laboratory tends to be less expensive than having them done at the doctor’s office. “When you buy it off the shelf directly from a virtual environment, versus the doctor’s visit, it tends to be somewhat more cost-effective,” Velázquez said. And while Velázquez is aware of the demographic breakdown of the users of such tests, he was careful to note the offerings are intended to have a multigenerational appeal. “Our goal is to really focus on the wellness and physiological components for patients,” he said. However, PAML does not intend to stop there. In addition to expanding Results Direct™, the gift card concept will be rolled out at traditional pharmacies and a large-box retailer Velázquez declined to name. And there is also a plan in the works to license a Food and Drug Administration-approved cell-gathering device patients can use to collect tissues at home and mail them directly to PAML for testing in a prepaid FedEx envelope that would come with the test. Results would be sent to patients electronically within seven to 10 days. “If you survey consumers, the number-one reason for [marketing directly to consumers] is convenience, and it doesn’t require traditional interface with other providers,” Velázquez said. Pricing has yet to be set for that product. Should test results occur outside the norm (such as a high cholesterol reading occurring within the testing), PAML’s staff would notify the patient by phone and suggest they make an appointment with their physician. Some Skepticism Controversies about the direct-to-consumer market linger. Sean Valles, a professor at Michigan State University and a researcher of genetics, recently observed in the journal Perspectives in Biology and Medicine that “surprisingly little attention has been paid to the specific tests included in the panels offered by the various companies. Indeed, close examination of these tests demonstrates a pervasive problem in mail-order genomic testing: Ambivalence toward the goal of designing tests with clinical utility, or tests that medically benefit patients.” The College of American Pathologists has also suggested that vigilance be exercised in marketing tests directly to consumers. “CAP believes that direct-to-consumer testing is clinical laboratory testing and should be subject to appropriate safeguards for health related conditions. While direct-to-consumer testing has the potential to empower patients in the management of their own health, it is no different than testing ordered by a licensed provider in that it poses a number of risks to the patient and public safety,” John Scott, CAP’s vice president of advocacy, said in a 2010 letter to the Oversight and Investigations Subcommittee of the U.S. House of Representatives. And there is still some skepticism about the actual promise of the direct-to-consumer market. “I don’t see a great rush by labs to do this,” said Jack Mattice of J.A. Mattice Associates, a laboratory consulting business based in Vancouver, Wash. Mattice also noted that some test positives—false or not—tend to trigger a stampede to the family physician. “Many docs consider it to be a nuisance,” he observed. But Velázquez noted that the prevalence of the Internet and smartphones means that younger patients are going to be driving a demand to monitor their health status on an ongoing basis. “We are providing for a niche that wants data right now,” he said. Mattice did say that he will be following how PAML’s direct-to-consumer products fare. “It will be interesting to watch,” he said.