Myriad Genetics Adds Breast Cancer Prognostic Dx to Portfolio Through Sividon Acquisition
- FLASCO
- June 2, 2016
- News
Myriad Genetics announced after the close of the market Tuesday the acquisition of Sividon Diagnostics in a deal that adds a breast cancer prognostic test to Myriad’s product portfolio and enhances its competitive position in oncology diagnostics. Myriad acquired Sividon for €35 million ($39 million) upfront and up to €15 million in payments based on the product achieving future performance milestones. The company funded the deal using cash on hand. Myriad expects Sividon to generate $8 million in revenues in fiscal year 2017 from sales outside of the United States, Myriad officials said on a conference call following announcement of the deal. The firm also expects the deal to be neutral to revenue and earnings in FY 2017, which for Myriad ends on June 30, 2017, but accretive to revenue and earnings in FY 2018 and beyond. With the acquisition of Sividon, Myriad Genetics gains global distribution rights for EndoPredict, a kit-based RNA expression test that evaluates 12 genes to assess the aggressiveness of breast cancer on a molecular level. The test combines gene expression profiling on a quantitative real-time PCR platform with standard prognostic factors. Sividon, a Cologne, Germany-based spinoff from Siemens Healthcare Diagnostics, has been selling EndoPredict to pathology laboratories in Germany and elsewhere, mostly in Europe. It received the CE mark for the test in late 2012, and the company has since announced plans to expand its business by launching EndoPredict in the US and China. 6/2/2016 Myriad Genetics Adds Breast Cancer Prognostic Dxto Portfolio Through Sividon Acquisition | GenomeWeb https://www.genomeweb.com/moleculardiagnostics/myriadgeneticsaddsbreastcancerprognosticdxportfoliothroughsividon 2/3 Though the test currently runs on Siemens’ Versant instrument, Myriad noted in a statement that it plans to transition EndoPredict to Thermo Fisher Scientific’s QuantStudio platform as part of its international kit strategy. In early 2014, the company, which had grown from an initial eight employees to about 25, partnered with Myriad Genetics’ international subsidiary, granting it exclusive rights to distribute EndoPredict worldwide, with a couple of notable exceptions, including the US and China. Although EndoPredict is not yet available in the US, Myriad expects a US launch in the second half of FY 2017. Myriad executives further noted on the call that they expect the greatest adoption of EndoPredict will occur in the US, Canada, and Europe. The company expects that by 2020 the global reimbursed total addressable market for EndoPredict could be greater than $600 million annually. A 10 percent penetration of this market would enable EndoPredict to become one of Myriad’s seven products generating in excess of $50 million annually in global sales. In coming years, Myriad expects that sales growth will come partly from expansion in reimbursement for EndoPredict. The test has already received positive reimbursement decisions from Aetna, as well as from Medicare contractor Noridian, based on guideline inclusions from organizations such as the American Society of Clinical Oncology, the European Society for Medical Oncology and St. Gallen. The kit-based test has been evaluated in five major studies incorporating more than 4,000 patients, and it’s been used clinically on more than 13,000 patients worldwide. According to Myriad officials, EndoPredict’s lack of an intermediate-risk result is a key part of its value proposition, and it has performed well in head-to-head tests with competing solutions. EndoPredict, however, will enter a crowded market in the US. The test will compete with Genomic Health’s Oncotype DX, which currently leads the US testing market for breast cancer prognosis, as well as NanoString’s Prosigna, Agendia’s MammaPrint, and others. Following Myriad’s call, Wells Fargo analyst Tim Evans published a research note calling the deal “an incremental positive” for Myriad. “We believe that with [Myriad’s] commercial scale and expertise, EndoPredict could become a more viable competitor for [Genomic Health’s] OncotypeDx breast diagnostic test,” he wrote. “In order for EndoPredict to be competitive with [OncotypeDx], however, we believe the test will need to be validated and written into [National Comprehensive Cancer Network] guidelines as having both prognostic and predictive value. In other words, it needs to be validated as a test that can identify patients who will respond to chemotherapy.”
