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Licensed to test
June 2010
by David Hutton  |  Email the author


LAVAL, Quebec —Warnex Medical Laboratories has licensed from German molecular diagnostics firm Epigenomics non-exclusive rights to the Septin9 biomarker. Under the terms of the agreement, Warnex has obtained the rights to establish a laboratory- developed test for Septin9 and offer colorectal cancer blood testing services in Canada.  
Warnex plans to launch the testing service in the next few months. As the first laboratory to offer Septin9 testing in Canada, Warnex, subject to certain conditions, enjoys a time-limited head-start period of exclusivity for the Canadian market.
Oliver Schacht, CFO of Epigenomics, notes that his company is entitled to receive royalties based on Warnex's test sales.
"Analysts have typically estimated Epigenomics' royalty rate from such laboratory licensing deals to be in the high single-digit to low double-digit range," he says. Further contractual details were not disclosed.  
Mark Busgang, president and CEO of Warnex, says his company is pleased to add the colorectal cancer test based on real-time PCR technology to its service offering as part of a continued commitment to offering the most advanced specialized diagnostic services to Canadian healthcare professionals.
"This blood test, using Epigenomics' Septin9 biomarker, offers an easy and accurate method to help diagnose patients with colorectal cancer," he says.   Schacht points out that Warnex was an attractive partner because it is "one of the most innovative and leading laboratory players in Canada with a clear focus on novel molecular diagnostics. The team at Warnex has been very enthusiastic about the Septin9 colorectal cancer blood test opportunity, and they are working closely with our team to coordinate marketing and positioning efforts. So from our end, they are a highly motivated and dedicated partner that is ideally positioned to introduce such a novel test concept in Canada."  
According to Schacht, the measurement of Septin9 in a simple blood draw is more convenient for the patient and for the doctor than a stool based test or an endoscopic examination. Secondly, early detection of colorectal cancer in a simple blood draw has the potential to overcome the most challenging hurdles in colorectal screening—patient compliance.  
"Epigenomics showed in seven clinical studies between 2005 and 2008 with a total of more than 3,300 subjects that Septin9 in blood plasma is a strong biomarker for the presence of colorectal cancer," he notes. "Furthermore, the test has been prospectively validated in the screening cohort study PRESEPT. Since October 2009, the test is available as a CE marked kit in Europe already and is marketed as a CE marked test kit by Abbott in Europe and Asia Pacific."  
In this short period of commercialization, Schacht notes that the Septin9 test has proven its ability to detect cancers at early stages from simple blood samples in the European market.
"As a simple one-marker the test has clear advantages in terms of complexity and costs compared to multi-marker RNA panel tests," he says. "Using blood rather than stool is another clear advantage for the Septin9 test."  
According to Yvan Côté, vice president and general manager of Warnex Medical Laboratories, the license between Warnex Medical Laboratories and Epigenomics was attractive because the Septin9 blood test is a specialized diagnostic test for colorectal cancer screening that clearly answers a clinical unmet need.   Côté adds that Warnex Medical Laboratories is a reference laboratory in high-value specialized diagnostics.  
"Warnex does not perform any routine tests such as a basic glucose measurement, but rather, concentrates its efforts in offering specialized diagnostic services in niche markets with a clinical unmet need," Côté adds. "One of Warnex Medical Laboratories' growth strategies is to bring more high-value, specialized diagnostic tests to the Canadian market. Given that the Septin9 blood test for the screening of colorectal cancer is a highly specialized diagnostic test and that it answers a clinical unmet need, it will clearly be a great addition to the niche services that Warnex Medical Laboratories already offers to the Canadian population."  
Two examples of such niche services currently offered by Warnex are the KRAS test that helps in the selection of treatment options for colorectal cancer and the PCA3 test for the detection of prostate cancer.
"This agreement is an important further step in the international rollout of Septin9 testing, which is already commercially available in the US and Europe," says Geert Nygaard, CEO of Epigenomics.  
Berlin-based Epigenomics sells the CE-marked test Epi proColon, which it said is the world's first regulatory cleared molecular diagnostic test for the detection of colorectal cancer in blood that is based on the Septin9 biomarker.  
This paved the way for a convenient blood test for colorectal cancer early detection that can easily be integrated into the patient's routine physical, is non-invasive and does not require any drug or dietary restrictions.  
Colorectal cancer is the second-leading cause of cancer death in Canada. In 2009, an estimated 22,000 Canadians were diagnosed with the disease and 9,100 died from it. Warnex currently offers KRAS genetic testing, which has been shown to help identify patients whose tumors may become resistant to anti-EGFR therapies like Vectibix and Erbitux. The assay could become an important revenue driver for labs that perform it because the American Society for Clinical Oncology in January 2009 urged routine KRAS testing to guide treatment for metastatic colorectal cancer.   According to Côté, the goal is to develop and validate an assay for Septin9 according to our standards in the next three to six months.
"The success of any new service that Warnex Medical Laboratories launches is measured by looking at 3 different parameters: (1) Increasing revenues as the service is rolled out in Canada, (2) Broad adoption of the new service by physicians (i.e. increasing number of physicians using the service) and (3) Client satisfaction, patients and physicians," Côté concludes.  
Schacht points out that there are some milestones on the way to the success of Septin9 in Canada.  
"As a first important step we have to create acceptance by key opinion leaders in the country," he notes. "We anticipate commercial traction as a lab testing service and expect ultimately IVD test kit sales in Canada once a Canadian cleared IVD kit becomes available."
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Moreover, the test has definitely the potential to increase compliance with CRC screening and Schacht says the company hopes to measure that in the near future by the lives saved due to higher compliance with colorectal cancer screening.


"With the high health economic benefit of increasing CRC screening compliance by performing a simple blood test and detecting more and more CRC cases early, we expect that the survival chances are much better and costs to healthcare system are low," he concludes.

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