Regulatory and Reimbursement Obstacles Clinical Update...

April 8, 2016Sky Song / Scottsdale

Regulatory and Reimbursement ObstaclesClinical Update of Molecular Diagnostics

ASU

Bruce Quinn MD PhDBruce . Quinn @ faegrebd . com323 839 8637 mobile

Digital Health & Genomics

Deck and White PaperAvailable…

Deck is available by emailWhite Paper is available by email

Bruce.quinn@faegrebd.com

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Up To Date: Y E S T E R D A Y (April 7)

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Overview: The Impact of Dhealth on Genomics

Digital Health: $5B invested in CY2015►7% of all Venture Capital investment

Emerging Trends We Can Identify Now:

1) Genomic labs form networks with hospital centers2) New generation electronic networks connection patient, 

doctor, EHR, genomics, clinical decision support3) EHR becomes “smart” in use of genomic data4) Mathematics, bioinformatics, modeling channel the utility of 

genomic data

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What does DHealth mean?

“Digital Health”►Positively… encompasses electronic health records, clinical decision support, remote monitoring, telemedicine, and “big data”► We can just say DHealth instead of 20 words and phrases

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What does DHealth mean?

“Digital Health”►Positively… encompasses electronic health records, clinical decision support, remote monitoring, telemedicine, and “big data”► We can just say DHealth instead of 20 words and phrases

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►Negatively… so broad a term as to be meaningless

ONEGenomic Labs Form Networks with Providers

►Foundation Medicine► Publicly held laboratory in Cambridge, MA► $500 Investment from Roche in 2015► “Precision Medicine Exchange Consortium”► Vanderbilt, Northwestern, Cleveland Clinic, Others

►Caris Life Sciences► Privately held laboratory here in Phoenix, AZ► Well capitalized► “Caris Centers of Excellence”► Fox Chase Cancer Center, Carolinas Health System, Wayne State, 

Others

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ONEGenomic Labs Form Networks with Providers

WHY?►Heavy investment required in training, familiarity, IT systems integration (LIMS, EHR)

►Create new consortia of cancer centers that can easily collaborate (clinical trials, etc)

►Market Lock‐In► Like frequent flier points, owning books on an Amazon Kindle► Less head to head competition with other labs IN RETURN FOR 

smaller market of networked participantsOBSTACLES TO MANAGE►Compete with in‐house services at large medical centers►Still have to get “paid by payers”  

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TWONew complexity of active electronic interfaces

►Syapse► Palo Alto Startup► $25M new investment (Ascension Ventures)► Syapse Precision Medicine Platform► Not lab‐specific but has collaboration with Caris► “Cloud based software platform” genomics, clinical data, 

pharmacy data, decision support.  Supports TAPUR trial at ASCO.►Flatiron Health

► $130M from Google Health + $175M from Roche► Physician office support, dedicated to oncology, from payment 

systems to (some) genomics support, “the new standard for oncology technology”

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THREEEHR becomes SMART with Genomic Data

► AssureX, Genomind► Drug/gene analysis for psychiatry► NOT just a lab report of gene findings► Rather, provides drug‐specific reports

► Both services initially targeted neuropsychiatric drugs:► Difficult patients.  Lots of drugs.  Many choices.  Many generic drugs.

► Genelex► Seattle Laboratory (> 10 years)► Remodeling itself; YouScript offering, API to interface with health 

records and e‐Charts► NantHealth

► Los Angeles, $200M from Allscripts ($2B valuation) ► “EHR plus Genomics” and “Transformation of Care”

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Physician Orders Genetics Report; Integrated Bioinformatics

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Genetics

Databases

Ordering Physician

The Cutting Edge is Rapidly Moving…Genetics Integrated with Health System (YouScript)

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Genetics

NetworkedPhysicians

Databases Pharmacist

EHR

DrugOrders

PharmaCompliance

Ordering Physician

FOURVery sophisticated virtual genomics

►IN SILICO ANALYSIS & THE FDA► This is a big deal for the FDA► National Workshop in November 2015► Next generation sequencing is not (generally) FDA‐approved now► Future pathways may piggyback on variant databases which 

incorporate sophisticated software for variant calls

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FOURVery sophisticated virtual genomics

► Cellworks► Silicon Valley startup, VC 

funded► Predict likely effects of drug 

libraries on “virtual cells” by using very sophisticated mathematical modeling

► Genepeeks► Virtual genetic software 

added on top of parental or in vitro fertilization genomic test (e.g. screen collections of sperm donors) 

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► Massive Bio► NYC Startup► Virtual Tumor Board► “Precision Medicine Democratized”► Telemedicine meets information 

management meets genomics► IBM Watson and Pathway Genomics

► Pathway has collectively had $130M investments

► Most recent investor = IBM Watson► Genomics & Wellness► See also: Google Verily & Dexcom

CONCLUSIONS

►A LOT IS GOING ON

►A LOT OF MONEY IS ENTERING THE SPACE

►THESE AND MORE COMPANIES ARE IN THIS SPACE

►IF YOU’RE STUCK ON “NEW CPT CODES” YOU’LL MISS THIS

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IMPLICATIONS

►Changing industry structure, changing the boundaries of what it means to be “a genetics lab”

►Most of health system and payers will play catch‐up►Quantifying the healthcare value remains to be determined

Don’t ask:►“Does your lab have a medical app?”

►The important changes will be more like “sea changes”

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Digital Health & Genomics

Deck and White PaperAvailable…

Deck is available by emailWhite Paper is available by email

Bruce.quinn@faegrebd.comwww.tinryurl.com/digitalgenomicsbeta

Separate:Transcript of FDA Workshop on

Tumor Gene Panels February 2016www.tinyurl.com/fda20160220

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