[Updated, 8/12/14, 8:13 a.m ET] The FDA approved Exact Sciences’ Cologuard test today, signing off on the first non-invasive, stool-based DNA screening test for colorectal cancer.
The announcement isn’t a surprise, given the unanimous endorsement of the test in March by an FDA advisory panel that reviewed data from the company’s 10,000-patient clinical study. But it’s a huge deal nonetheless for Madison, WI-based Exact (NASDAQ: EXAS), which has nearly completed a remarkable turnaround after investors left it for dead five years ago. The local biotech community has been closely watching the startup since it relocated to Wisconsin from Boston in 2009.
[Updated with CEO comment] “The FDA approval of Cologuard represents a major achievement in [Exact’s] mission to make a non-invasive, patient-friendly screening test for colorectal cancer available,” said Exact Sciences CEO Kevin Conroy in a prepared statement. “Cologuard addresses a critical need for a more convenient screening option for patients to aid in prevention and early detection. [Exact] is committed to making Cologuard available and accessible to patients and looks forward to advancing cancer detection in other gastrointestinal cancers.”
[Updated with coverage decision timeline] The announcement is also likely to draw plenty of attention from the broader medical device industry because of Exact’s novel approach to commercialization, which involved simultaneously seeking the thumbs up from both the FDA and the Centers for Medicare & Medicaid Services (CMS). On Monday, CMS also issued its proposal to cover the Cologuard test once every three years for Medicare patients who meet certain criteria. A final coverage decision is expected in October or November, after a public comment period, Exact Sciences said.
“This is the first time in history that FDA has approved a technology and CMS has proposed national coverage on the same day,” said Patrick Conway, CMS chief medical officer and deputy administrator for innovation and quality, in a press release.
Cologuard was the first product reviewed through a pilot of this parallel FDA-CMS review program aimed at medical devices.
“Parallel review allows the last part of the FDA process to run at the same time as the CMS process, cutting as many as six months from the time from study initiation to coverage,” said Nancy Stade, deputy director for policy with the FDA’s Center for Devices and Radiological Health, in a statement. “The pilot program is ongoing, but we will apply what we have learned to improve the efficiency of the medical device approval pathway for devices that address an important public health need.”
[Updated with Cologuard price] Cologuard will cost $599 per patient, Exact said on Tuesday. Some analysts had speculated a price between $300 and $500 per patient. One of the company’s next steps will be getting private health insurers to cover the test as well. But private insurers often follow CMS’ lead in these situations.
The company must also convince doctors to recommend the test, and get patients to ship their stool samples for lab analysis.
Shares of Exact edged up about 3 percent in after-hours trading on Monday.