Myriad snags Medicare coverage for prostate cancer test

Mark Capone, CEO of Myriad Genetics

Myriad Genetics ($MYGN) nabbed Medicare coverage for its prostate cancer screening test, a win for the company as it struggles with waning revenues and increased competition from rivals in the genetic testing market.

Myriad's Medicare Administrative Contractor, Noridian, issued a final local coverage determination for Prolaris to determine the aggressiveness of men's prostate cancer. The decision, which is effective as of Oct. 15, 2015, will cover the test for about 60,000 patients diagnosed in the U.S. each year with localized prostate cancer, the company said in a statement.

"We are excited that Noridian has issued a final LCD for Prolaris, providing coverage for Medicare beneficiaries with localized prostate cancer," Myriad CEO Mark Capone said in a statement. "The decision is an important step in providing Medicare reimbursement for this life-saving test and will significantly increase patient access to Prolaris testing in the United States."

Myriad is touting some promising data for its test, presenting numbers last year at the Society of Urologic Oncology meeting that showed Prolaris could save the healthcare system $6 billion over 10 years. There are about 220,000 new cases of prostate cancer diagnosed in the U.S. each year and 30,000 men will die from the disease, making it the second leading cause of cancer death among men in the U.S., the company said in a statement. Myriad's test looks at patients' individual risk of developing the disease, which could result in meaningful treatment changes, the company said in a statement.

Medicare coverage for Prolaris comes at a critical moment, as Myriad deals with lagging fortunes and attempts to hold onto its dominant position in the BRCA testing market. BRCA testing still accounts for about 80% of the company's sales, but Myriad has reported lower profits and waning numbers for its cancer tests after the U.S. Supreme Court invalidated 5 of its patents for human DNA in 2013.

Since then, rivals including Invitae ($NVTA) and Quest Diagnostics ($DGX) have picked up steam, rolling out next-generation products and challenging business models laid out by Myriad. Invitae, for example, announced earlier this year that it would slash prices for its genetic tests to gain volume. Myriad's 25-gene myRisk test for cancer runs at about $4,000, while Invitae's test screens for mutations in 220 genes for $1,500.

Still, Myriad is working hard to swing its numbers northward. The Salt Lake City, UT-based company earlier this year expanded is companion diagnostics partnership with pharma heavyweight AstraZeneca ($AZN), deepening its dive into the field. And fourth-quarter testing revenue for Myriad's myRisk Hereditary Cancer panel jumped to $100.9 million from $27.3 million during the same quarter last year.

"As we look forward to fiscal 2016, we are confident that we are poised to generate top- and bottom-line growth beginning a trend that reflect increased investments in our product pipeline and international expansion," Capone said in the company's Q4 earnings statement.

- here's Myriad's statement