Cancer Genetics, Mayo Clinic Form Joint Venture
Cancer Genetics, a New Jersey-based company focused on molecular testing for cancer, has scored a big partner to help further its business interests: the storied Mayo Clinic. Cancer Genetics and the Rochester, Minn.-based Mayo announced last month that the two will enter into a joint venture to develop new sequencing diagnostic tests to battle two […]
Cancer Genetics, a New Jersey-based company focused on molecular testing for cancer, has scored a big partner to help further its business interests: the storied Mayo Clinic. Cancer Genetics and the Rochester, Minn.-based Mayo announced last month that the two will enter into a joint venture to develop new sequencing diagnostic tests to battle two types of the disease: hematological and urogenital cancers. There are about 150,000 hematological cancers diagnosed in the United States every year, with a mortality rate of 37 percent. There are more than 380,000 urogenital cancers diagnosed annually, with a mortality rate of 25 percent. The company, known as OncoSpire, will be funded by Cancer Genetics with at least $2 million in cash provided by the company over the next three years, with the commitment rising to as much as $6 million if needed, officials said. The Mayo Clinic will donate in-kind contributions that include sequencing infrastructure, clinical expertise, and other operational resources, according to Samuel Smith, a Mayo spokesperson. “Individualized medicine and genomic testing give us a fundamental understanding of the inner workings of wellness and disease. We recognize the transformative power of these tools and are committed to using every resource at our disposal to bring individualized medicine to our patients,” said Gianrico Farrugia, M.D., a Mayo Clinic gastroenterologist and director of Mayo Clinic’s Center for Individualized Medicine. Farrugia is one of the six-member board of governors that will oversee OncoSpire’s operations. Three of the members are from Mayo, while three are from Cancer Genetics, including its chief executive officer, Panna Sharma. The company has been moving away from the development stage in recent years. Although Cancer Genetics posted a $6.7 million loss on revenue of $4.3 million in 2012, its revenues were up 40 percent compared to 2011. Its 2012 losses were far lower than the $19.9 million loss it reported in 2011. For the first quarter of 2013, revenue was up nearly 50 percent from the first quarter of 2012, while clinical test volume was up nearly 20 percent. At the moment, the distribution plans for any new diagnostic products have yet to be finalized. “There is no one fixed distribution channel. OncoSpire will work with Mayo to commercialize diagnostic laboratory services through Mayo Medical Laboratories,” Smith said. “OncoSpire will also work with Cancer Genetics to commercialize diagnostic products [such as FDA-approved kits]. OncoSpire may also directly commercialize laboratory services and products.” However, the ambitions of the joint venture are not limited. Smith said OncoSpire would eventually “expand biomarker development activities” beyond hematological and urogenital cancers.