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A CEO’s Guide to Molecular Diagnostic Reimbursement: Navigating the Many Challenges of Reimbursement and Commercialization

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Reimbursement and commercialization are significant challenges in this era of personalized medicine and comparative effectiveness. Many traditional clinical laboratories and early stage startup companies are trying to enter this space and are struggling to evaluate both the market and its offerings. According to Gene Tests, a publicly funded medical genetics information resource, the availability of new diagnostic tests increases 10% annually. However, there is a 20% increase in the utilization of genetic tests per year versus a 1% to 3% increase in non-genetic diagnostic tests per year.

In 2007, for example, genetic tests cost Aetna 70 cents per member per month as an aggregate. These numbers are increasing. In 2005/2006 genetic testing comprised 17% of Aetna’s testing dollars; in 2006/2007 it was 21%.

Some view genetic testing technologies as disruptive to traditional physician practice patterns as well as to pharmaceutical companies, who may now have patient criteria limitations on their next potential blockbuster. Depending upon the source, it is believed that only between 9% and 21% of physicians use genetic tests. Many physicians say they don’t understand genetic tests well enough to use them effectively. It is imperative, therefore, that the molecular diagnostic industry improves its messaging and ability to educate physicians. There are many misperceptions regarding the capabilities of well validated genetic tests. Because genetic testing has proven to be valuable for the prognosis, diagnosis and management of many diseases, the commercial potential is quite significant.

The Dark Report is happy to offer our readers a chance to download our recently published White Paper “A CEO’s Guide to Molecular Diagnostic Reimbursement: Navigating the Many Challenges of Reimbursement and Commercialization” at absolutely no charge.

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The following are some of the questions to consider when creating a business plan for commercialization of a genetic test:

  • How can clinical utility be established prior to launch?
  • What is the current environment in your targeted diagnostic area?
  • What is the fully loaded cost of goods?
  • What will your billing capabilities be?
  • What will your billing policies and rules include?
  • Diagnostic Kit or Laboratory Developed Test?

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Table of Contents:

Preface – Page 3

Chapter 1. Considerations for Commercialization and Reimbursement of a New Molecular Diagnostic – Page 5

Chapter 2. The Road to Coverage – Page 10

Chapter 3. Reimbursement Options for Molecular Tests – Page 15

Chapter 4. Coverage and Contracting for Molecular Tests –  Page 18

Chapter 5. Conclusions – Page 23


A-1 About Rina Wolf – Page 25
A-2 About XIFIN Inc. – Page 26
A-3 About DARK Daily – Page 27
A-4 About The Dark Intelligence Group, Inc., and THE DARK REPORT – Page 28
A-5 About the Executive War College on Laboratory Pathology Management – Page 29
A-6 About Karen Appold – Page 31

Terms of Use – Page 35

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Diagnostic Kit or Laboratory Developed Test?

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