As seen in the August 2011 edition of Life Science Leader magazine.
By Suzanne Elvidge, contributing editor
Following the sequencing of the human genome, completed more than 10 years ago, there has been an explosion in the identification of genes and their mutations, and the association of genes with disease states. A number of companies exploited these breakthroughs to develop diagnostic tests based on gene expression. For Norwegian company DiaGenic, while these tests proved effective in the clinic, they were less successful in the market, so the company decided to re-invent itself in 2010.
Gene Expression Diagnostics 101
Levels of RNA (ribonucleic acid) expression change during disease states, but taking samples to detect these can be invasive, for example, taking biopsies from tumors for assessing cancers or extracting samples of cerebrospinal fluid to look at expression in neurological disorders. However, the increased levels of RNA expression are also reflected in peripheral blood as “gene signatures.” Blood-based gene expression diagnostics measure these and compare the results against normal levels and allow physicians to diagnose disease.
DiaGenic, based in Oslo, Norway, originally started by developing blood-based genetic tests, looking at disease-specific changes in the activity of 96 genes in the peripheral blood. The company’s first product for Alzheimer’s disease, ADtect, was CE marked (a mandatory conformance mark for European products) in late 2009. This was followed by the CE marking of BCtect, a breast cancer blood-based diagnostic. “ADtect was the first blood-based Alzheimer’s disease diagnostic to get a CE mark in Europe,” says Erik Christensen M.D., Ph.D., CEO, DiaGenic.
The Obstacles And The Opportunities
ADtect and BCtect were marketed in 20 countries in Europe during 2009 and 2010, but the sales were not as high as the company had hoped or expected. “We had teamed up with a number of small distributors, but came up against issues with reimbursement.” says Christensen. “The systems can be different in each country, and the process can take years. As we were the first to market with an Alzheimer’s disease gene expression test, this was a new approach for physicians, and it is very difficult for a small company and small distributors to change medical practice.”
However, amongst the obstacles, company management also noticed a potential opportunity. DiaGenic’s Alzheimer’s disease test is the only one on the market that uses blood samples – other tests require CSF (cerebrospinal fluid) sampling. CSF tests are sensitive but not always specific, and the sampling is an unpleasant and risky process. The increased convenience and improved sensitivity made the test attractive to the pharmaceutical industry for use in clinical trials, to stratify patients by their likelihood to respond, or their risk of developing side effects, as well as to provide objective rather than subjective clinical endpoints.
Alzheimer’s disease is a huge market and a major unmet medical need. The disease affects around 34 million people worldwide and could rise to more than 100 million in 2050. The worldwide costs associated with Alzheimer’s disease were $422 billion in 2009, and its treatment is currently only symptomatic. According to DiaGenic, in 2010, there were approximately 90 therapeutics in development with potential to slow or stop the progression of Alzheimer’s disease, and DiaGenic’s technology could have potential in any of these clinical trials.
ADtect has similar accuracy to conventional diagnostics, but is faster, lower cost, and is sensitive enough to detect early-stage Alzheimer’s disease. The company also is developing MCItect for the diagnosis of mild cognitive impairment in patients, that will progress to Alzheimer’s disease, and expects to have a prototype test by the first half of 2012. Being able to test for MCI could potentially increase the Alzheimer’s disease market by 60%. As well as diagnosing MCI, the test concept could also predict MCI patients’ responses to drugs.
The use of diagnostics in drug development has potential in a wide range of therapeutic areas, not just in Alzheimer’s disease, and can reduce the numbers of patients needed in clinical trials and shorten the length of the studies. It also has benefits for patients during the clinical trials – potential non-responders or people at higher risk of side effects won’t have to take drugs that will not improve their outcome, or could potentially bring them harm. “With many drugs, only a minority of patients responds — this could be as low as 20 to 30%,” says Christensen.
Gene expression diagnostics could find a use with existing agents, including generic drugs, to predict patients’ responses. This would be of benefit to payors, such as insurance companies, as well as patients, as it could allow the use of cheaper, off-patent therapeutics.
Gene expression diagnostics don’t just have potential with therapeutics – PET (positron emission tomography) imaging will probably become one of the most effective methods for diagnosis and monitoring of Alzheimer’s disease, but will be very expensive. Gene expression diagnostics can be used to select patients for PET imaging, reducing costs (so benefitting payors), saving patients from going through procedures that won’t help them, and helping to validate PET imaging as a useful diagnostic tool.
Successful clinical trials will also act as a validation for DiaGenic’s diagnostic technology, making it easier for the company to create partnerships with other pharmaceutical companies, and also to market the tests as companion diagnostics, or even as stand-alones. In order to support this, as the company currently only has approval in Europe, DiaGenic has started a dialogue with the FDA, and will need to run clinical trials in the United States and use FDA-compliant instruments and equipment. The company will seek a partner for this, and discussions are ongoing. “The United States is the largest marketplace, particularly for Alzheimer’s disease, as its population ages,” says Christensen.
Making The Changes
“The development of diagnostics to support drug development is part of an industry trend, and we started to look at how we could collaborate with the pharmaceutical industry to exploit this,” says Christensen. And so, in 2010, DiaGenic made the decision to move from a focus on tests for physicians’ use to a focus on tests for stratifying patients in the recruitment for clinical trials. In order to make the most of the opportunities, the company had to make some changes in organizational focus and responsibilities. These were complemented with the election of a new board of directors in June 2010, focusing on people with experience in the pharmaceutical industry. “We had been moving in this direction over the previous year or two, but we accelerated the changes based on the feedback from the pharma companies, and have been able to keep all our members of staff,” says Christensen.
The company also had to make changes to its business model and partnering strategy, moving away from the traditional molecular diagnostics sales model and making a conscious effort to focus on the global top 10 players in pharmaceutical development and imaging.
This started with a collaboration with Pfizer, signed in December 2010. Under the terms of the agreement, DiaGenic is looking to find disease progression biomarkers to identify patients with mild cognitive impairment (MCI), the very early stages of Alzheimer’s disease. The symptoms of MCI can begin decades before any symptoms of dementia.
The research program will use samples from ongoing clinical trials and will look at gene expression patterns in subjects with stable mild cognitive impairment (MCI), progressive MCI (prodromal AD), and Alzheimer’s disease. Pfizer will use the resulting tests in R&D and drug development. This strategy has the potential to increase the size of the market for Alzheimer’s disease therapeutics, considering early treatment may have potential to slow or prevent disease progression.
“Through collaborating with a major pharmaceutical company, our strategy is to develop biomarkers to enable early disease detection for clinical trials,” says Christensen. “This collaboration is the first result of DiaGenic’s refocused strategy on teaming up with large pharmaceutical companies to deliver new diagnostic tools. It also demonstrates that DiaGenic is an attractive partner for identifying progression biomarkers as we bring along a unique experience in blood-based gene expression testing as well as an extensive biobank of well-characterized MCI and AD patients.”
DiaGenic recently refinanced through a share issue, and the new strategy helped the company to attract new investors. The company aims to achieve break-even in the second half of 2012 through a combination of revenue streams from R&D and licensing fees, milestones and royalty payments for partnered products, and revenue from sales of standalone diagnostics. “Funding has been difficult to find for early stage diagnostics companies. This approach could be a funding lifeline in the current financial climate,” says Christensen.
Moving Toward Companion Diagnostics
As part of its new strategy, DiaGenic is looking at developing companion diagnostics from the biomarker tests used in the clinical trials. These would be sold alongside the marketed therapeutics, so that physicians (and payors) could confirm that the correct patients are selected for treatment.
“Developing companion diagnostics is the way forward, because it provides access to a much larger market,” says Christensen. “However, outside of clinical trials with a partner, the scarcity of samples from commercial biobanks was a potential obstacle.”
In order to overcome this obstacle, one of DiaGenic’s key steps was the development and characterization of its own biobank, by teaming up with universities across Europe and the United States.