Exact’s Colon Cancer Test Included in Medical Organization Recommendations

Xconomy Boston — 

Exact Sciences (NASDAQ: EXAS) got some long-awaited good news yesterday afternoon when the American Cancer Society unveiled new colorectal cancer screening guidelines that recommend, among other things, the use of the Marlborough, MA firm’s noninvasive DNA-based test for the disease.

Developed by the ACS in conjunction with the American College of Radiology and the U.S. Multi-Society Task Force on Colorectal Cancer, the guidelines are the first to include Exact’s test alongside colonoscopy, fecal occult blood testing, and other tests as options for detecting colorectal cancer—the second leading cause of cancer death in the United States. As Malorye described back in October, Exact has been waiting for just such an endorsement to boost sales of its technology, which has been marketed by Burlington, NC’s LabCorp since 2003.

The test aims to detect DNA changes that signal cancer by isolating and analyzing DNA from stool samples. Because it can be conducted on a stool sample taken at home and sent into the lab, it’s billed as a much less unpleasant alternative to the likes of colonoscopy. But the panel that crafted the new screening recommendations emphasized that Exact’s test, and competing tests that looks for blood in the stool, primarily detect cancer once it has already developed—whereas colonoscopy, barium enemas, and other invasive techniques can more readily detect changes that precede cancer. The guidelines therefore express a strong preference for the more invasive tests, so long as patients are willing to undergo them and have access to them. The panel also wrote that, though the manufacturer recommends that its test be repeated every five years, there are “insufficient data upon which to endorse this interval,” and recommended that further research be conducted to determine just how often people should be screened with the DNA test.

What’s also yet to be determined is whether Medicare will cover the cost of the DNA-based screening, and whether the FDA will approve the technology. While the test has already entered the market via the least stringent regulatory pathway (and has been covered by many private insurers), the FDA recently alerted Exact that the agency believes a more stringent approval process is required for the technology. (It’s a bit of a thorny area; see Malorye’s story for a more thorough discussion.) And in January Exact said it would hold off on its efforts to gain Medicare coverage for the test until the regulatory issues were settled. An Exact representative said today that the company expects that gaining FDA approval will take until the second half of 2009 at the earliest; LabCorp intends to continue offering the test in the interim.

Shares of Exact were trading around $3.30 around, up 58 percent from yesterday’s close of $2.09.