NanoString Nabs Ex-Seattle Genetics Exec to Lead Diagnostic Push

5/29/12Follow @xconomy

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game plan with PAM50. The company presented detailed results from its first significant clinical trial last December at the San Antonio Breast Cancer Symposium. What was important there to know is that NanoString’s test was able to classify women as clearly being at “high,” “low,” or “intermediate” risk of having a breast cancer relapse. Women can already get that kind of information from Genomic Health’s 21-gene test, although researchers said the NanoString test was able to put fewer women in that gray zone of “intermediate” where it’s less obvious whether or not to get aggressive with preventive rounds of chemotherapy.

While Gray described achieving the trial as one of the most important events in NanoString history, the nCounter still has a long way to go as a product. NanoString is looking to confirm that result with another clinical trial that just got underway. The new study, like the previous one, will ask whether NanoString’s machine can process 15-year old tumor samples and accurately predict, based on their PAM50 genetic profiles, what kind of medical outcome those women ended up with. NanoString is able to run this test on samples from the Austrian Breast & Colorectal Cancer Study Group 8, because the samples were preserved, the study was initiated in 1996, and women who enrolled have been tracked over the long term.

NanoString CEO Brad Gray

Gray isn’t saying when NanoString hopes to wrap up that study, but because it doesn’t require new women to enroll, the company won’t be held up by trial recruitment delays, which often pose an obstacle to drug developers. The results, when they arrive, will clearly be a key part of the marketing message that Seeley hopes to develop and aim at oncologists.

Redwood City,CA-based Genomic Health (NASDAQ: GHDX) has been a trailblazer in developing high-value, high-cost predictive diagnostic tests, and in establishing a business model where doctors send in their samples to a central lab for analysis. The company generated $206 million in revenues last year this way. NanoString plans to pursue a different business model, by selling the instrument to the oncologist, and also selling the proprietary chemical reagents to run each test themselves.

Getting doctors excited about the medical information NanoString provides will be one of the key challenges, and so will creating a pricing strategy that works for insurers. Seeley will have to do some homework on the competitive landscape, Gray says. And once the product gets regulatory clearance, he’s going to have to hire some top sales talent to make the case for a new and unfamiliar type of diagnostic.

“Bruce will have a lot of work to do when he arrives,” Gray says. “We want to deliver this product to patients wherever we can as quickly as we can. And we’ll do it without taking any shortcuts.”

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