FT: Erbitux nod marks sea change in companion Dx

Last month's FDA approval of Qiagen's ($QGEN) diagnostic for the cancer drug Erbitux is indicative of a trend in pharma: Drugmakers and regulators are recognizing the importance of companion diagnostics in the world of targeted treatments, The Financial Times reports.

Erbitux, made by Bristol-Myers Squibb ($BMY) and Eli Lilly ($LLY), got an indication for colorectal cancer, and Qiagen's assay will allow doctors to weed out the patients who won't respond to the potential blockbuster. All the parties involved are eyeing big profits from the combination, and some analysts say we can expect more and more companion diagnostics deals as the industry embraces personalized medicine.

"Twenty years ago the paradigm was that for every 100 cancer patients treated, 10 benefited," UBS analyst Gbola Amusa told the FT. "If you could instead only treat those 10 patients, you get the same result without putting through 90 who don't benefit, and society gains. 10 years from now, this will be standard."

But not everyone's outlook is so rosy. For one, there is concern over whether public and private payers will be willing to pony up for the tests. In order to justify the lower sales of targeted drugs, drugmakers will adjust prices accordingly, and that may not jibe with the bottom lines of payer groups.

Furthermore, on the drugmaker side, implementing companion diagnostics isn't always as easy as it would seem. As Roche's ($RHHBY) chief medical officer for diagnostics, James Creeden, explained at BIO 2012, his company has no way to ensure that patients get the company's FDA-approved companion diagnostic and not a copycat test produced by another company. Off-brand assays are often wildly inaccurate, Creeden said, and if patients get unreliable results from their companion drugs as a result, it could cut into prescription rates and mar profits.

- read the FT story (reg. req.)