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| Foundation Medicine CCO David Daly |
Foundation Medicine ($FMI) is rolling out a cancer genomics software system for next-generation sequencing (NGS) tests, building out its offerings amid an increasingly stringent reimbursement environment.
The Cambridge, MA-based company's GeneKit tool draws on Foundation's trove of genomic data to give medical teams information about a patient's cancer. The product runs with NGS or "hot spot" tests that look at 50 genes associated with the disease, and combines Foundation's proprietary data with a patient's information to provide individual readouts, the company said in a statement.
"Today, a large number of institutions use manual interpretation procedures that can be incredibly arduous, technical and time-consuming," David Daly, Foundation's chief commercial officer, said in a statement. "GeneKit overcomes these challenges of manual reporting and furnishes pathologists with highly relevant clinical and scientific data for the betterment of patient care."
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| Dr. Michael Pellini, CEO of Foundation Medicine |
New products help Foundation at a critical moment, as it struggles to gain reimbursement for its tests. The company logged 8,846 clinical tests in Q2, a 50% hop year-over-year, but missed analysts' forecasts of 8,979 tests and the Street's prediction of 9,770 tests for the quarter. Part of the issue could be "slower than anticipated progress" for Medicare reimbursement, CEO Dr. Michael Pellini said at the time. And according to Leerink analyst Dan Leonard, the slowdown could have far-reaching effects.
"While we had never baked Medicare reimbursement into our 2015 forecast, we nonetheless assume the dampening impact on commercial volumes is greater than our prior view," Leonard said in a note to clients in July.
But Foundation is not taking the news lightly. The company has been working hard to gain traction since inking a $1.2 billion deal with Roche ($RHHBY) earlier this year. As part of the deal, Roche said it would funnel $150 million over the next 5 years toward a "broad R&D collaboration that speeds up Foundation's product development and expands the companies' global commercialization efforts."
Foundation is also exploring other avenues for growth, recently launching a precision medicine program to fuel cancer research. The initiative, dubbed Precision Medicine Exchange Consortium (PMEC), brings together experts in the field to share cancer data with the end goal of improving care for patients. Foundation has already signed on major institutions including The Cleveland Clinic's Taussing Cancer Institute and Northwestern University's Robert H. Lurie Comprehensive Cancer Center.
"Collectively, PMEC is poised to fuel innovation, support cancer research and extend valuable information and education in a way that heretofore has not happened within the cancer community," Foundation CMO Dr. Vincent Miller said in a statement. "We're proud to be launching this initiative with so many thought leaders across a broad spectrum of cancer institutions and practices."
- here's Foundation's statement
- read more about the PMEC