In a recent post, I discussed how Covance has obtained CLIA certification for its molecular diagnostics lab (see: Covance Genomics Lab Receives CLIA Certification). At the end of the note, I speculated about what had motivated the company to take this action. Theo submitted the following comment:
Isn't this similar to IVD manufacturers and pharma companies setting up or acquiring a CLIA lab? i.e., Novartis/Genoptix or Celera/Berkeley? A CLIA lab enables vertical integration. In the case of a CRO, the identical assay that is used throughout the trial can now be assured of availability post launch. For a pharma company with a drug/diagnostic combination - getting ready to launch without that particular assay having wide, or any availability - is a stumbling block to success.
Theo is right on target. I don't know how I missed his point in my original note but it's worth expanding on. Big Pharma and CROs are developing and buying genomic testing clinical labs because of the criticality of personalized medicine and companion diagnostics in the drug development process (see: Further Consideration of the Definition for Personalized Medicine; Pharmaceutical Companies Taking Personalized Medicine Much More Seriously; Consideration of a Broader Definition for "Companion Diagnostics"; Some Interesting Insights into Companion Diagnostics; More Details About Roche's Companion Diagnostics Strategy). Following Theo's lead, let me try to lay out the logic that I now understand buttresses the CRO/Big Pharma involvement in personalized medicine, companion diagnostics, and molecular diagnostics:
- Personalized medicine, the development of biotech drugs, and molecular diagnostics are inextricably intertwined. You can't discuss one of these ideas without addressing the others.
- Based on their relationship to companion diagnostics, biotech drugs are developed in parallel with molecular diagnostic tests designed to select patients for whom treatment with the drug is most efficacious.
- Companion diagnostics are also being used to screen clinical trial subjects for new biotech drugs so that the results of the clinical trial are the most favorable.
- The molecular diagnostic labs owned and operated by the CROs and Big Pharma must be CLIA-certified for such screening of potential subjects to have the most validity and market acceptance. Theo makes this point perfectly above: For a pharma company with a drug/diagnostic combination - getting ready to launch without that particular assay having wide, or any availability - is a stumbling block to success. He also make appropriate reference to the need for vertical integration of the companies.
- Put another way and to summarize all of these points, both the CROs and Big Pharma need to be deeply enmeshed in the molecular diagnostics business. This goal is best achieved with CLIA-certified labs. The biotech drugs they are developing and their companion diagnostics go hand-in-glove. This is not only for initial research subject selection during clinical trails but also for patient selection and use after the administration of the drug to measure continuing effectiveness.
- In order to sell more of a particular biotech drug, they may want to offer the companion diagnostic for free or at a highly discounted price. All of these options can be most effectively executed if they own or control the molecular diagnostics testing labs.
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