Making predictive cancer testing viable
Name: Peter Meldrum
Title: President and CEO
Peter Meldrum co-founded Utah's Myriad Genetics ($MYGN) in May 1991 and became president and CEO a few months later, a position he has held ever since. Under his leadership, Myriad discovered the BRCA1 and BRCA2 hereditary breast and ovarian cancer genes, and in 1996, launched its BRACAnalysis test, the first molecular diagnostic test to measure the risk for a major disease--hereditary breast and ovarian cancer.
That accomplishment is major, and Myriad's technology has changed lives. But the company under Meldrum's leadership has taken controversial steps to protect the international market dominance BRACAnalysis has achieved. Some rightly credit Myriad and Meldrum with adding a valuable new element to cancer testing. Others vilify the company's leadership for fighting so hard to prevent rivals from entering the BRCA test space--something that would arguably make the predictive diagnostic more affordable and accessible.
Today, BRACAnalysis is hugely profitable for Myriad. It's also ubiqituous enough that the company's stock rose when news broke last May that the actress Angelina Jolie had a double mastectomy after learning she faced a major risk for breast cancer. She likely obtained that knowledge from the Myriad test, which at the time was the only one of its kind on the market.
Myriad, under Meldrum's leadership, has argued its BRCA1 and BRCA2 patents prevented competition. Myriad took its case through numerous appeals and all the way to the U.S. Supreme Court in late 2012. At the time, Meldrum insisted that Myriad would ultimately be vindicated, based on previous court decisions that found it in the right.
"Two previous decisions by the Federal Circuit Court of Appeals confirmed the patentability of our groundbreaking diagnostic test that has helped close to one million people learn about their hereditary cancer risk," Meldrum said in a statement at the time. He also noted that the company devoted more than 17 years and $500 million to develop its BRACAnalysis test.
Myriad ended up getting a mixed decision. The U.S. Supreme Court determined over the summer that genes found in nature could not be patented, but that companies could obtain patents for genes altered by man. That ruling invalidated some Myriad BRCA patents but upheld others, throwing open the door to competition. Since then, LabCorp ($LH), Invitae, Quest Diagnostics ($DGX), BioReference Laboratories ($BRLI), Gene By Gene and Ambry Genetics have all launched their own BRCA tests. Myriad, under Meldrum's leadership, is suing all of them, alleging patent infringement.
To be sure, Myriad has launched a number of other cancer diagnostic tests in the wake of the Supreme Court Decision, in a bid to diversify. Also, earlier in February, the company inked a deal to snatch up Crescendo Bioscience for $270 million in cash, accessing new products focused on rheumatoid arthritis diagnostics and other autoimmune diseases. The BRCA tests have contributed disproportionally to the company's bottom line, so diversification is key to lessen Myriad's dependency on BRCA for its future.
Another threat hit Myriad on Jan. 1, when Medicare reimbursement for BRCA tests dropped by almost 50%--from $2,795 to $1,438 for a full sequencing of BRCA 1 and BRCA2, or for the sequencing of just BRCA1. The fear is that private insurers will follow suit. If they do, Myriad and Meldrum will have plenty of additional fights on their hands in the months ahead.
-- Mark Hollmer (email | Twitter)
Myriad braces for a direct hit with CMS set to slash BRCA Dx test payments
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