Genetic Technologies Limited: Quarterly Activities Report And Appendix 4C Of The ASX Listing Rules For The Quarter Ended 30 June 2017
Published: Jul 28, 2017
MELBOURNE, AUSTRALIA--(Marketwired - July 27, 2017) - Genetic Technologies Limited (ASX: GTG) (NASDAQ: GENE)
- Revised BREVAGenplus® commercial strategy attracting wider market interest
- Achieved 64% samples growth for the quarter
- Executed investigator initiated research Agreement with The Ohio State University
- Advanced development of colorectal cancer risk assessment test
- Maintained strong cash position with $11.0M in cash
Genetic Technologies Limited (ASX: GTG) (NASDAQ: GENE) ("Company"), a molecular diagnostics company focused on cancer risk assessment, and provider of BREVAGenplus®, a first-in-class, clinically validated risk assessment test for non-hereditary breast cancer, is pleased to provide its Quarterly Activities Report for the period ending 30 June 2017, together with the attached Appendix 4C.
"I'm particularly pleased with the progress achieved across the commercial and product development fronts. Our product repositioning and conversion to a direct self-pay program for BREVAGenplus has already produced results in terms of setting the stage for wider market adoption, and our development program for a colorectal risk assessment test and the new research initiative with The Ohio State University speak to our continued conviction to enhance our pipeline of SNP-based cancer risk assessment products," commented Eutillio Buccilli, Executive Director and Chief Executive Officer of Genetic Technologies.
Commercial and Financial Snapshot
Test samples received for the quarter were 265, including 140 tests issued to the Ohio State University (as part of the investigator initiated research Agreement), compared to 162 in the previous quarter (Q3 FY17). For the full year 2017, 1,035 test samples were received compared with the previous corresponding period (PCP) of 1,184 tests, representing a year on year decrease of 12.6%.
Total cash receipts from customers during the quarter ended 30 June 2017 were $147k, compared to $195k in the previous quarter, taking the figure to $704k for the full year ended on that date, compared to $1,187k in the PCP.
Operational cash spend for the full year 2017 was $7.8M, $1.4M less than the previous corresponding period of $9.2M and $5.4M less than the full year 2015 spend of $13.2M, representing a reduction in annual cash spend of 15% and 41% respectively.
In April 2017, the Company received $260k for ongoing eligible research and development expenditure under the Australian Governments R&D Tax Incentive program.
As at 30 June 2017, the Company had $11.0M in cash.
BREVAGenplus Marketing Update
Product repositioning and transition to direct self-pay program laying the foundation for wider market adoption
As reported last quarter, the Company has completed the commercial repositioning and repricing of BREVAGenplus, and in the process has refined its marketing strategy. As further reported, effective 1 April 2017, the Company commenced transitioning from a traditional reimbursement system, through insurance providers, to a direct patient self-pay program, with a new list price of USD $349.00 per test.
Genetic Technologies is pleased to report that market feedback to date suggests that the self-pay program is being well received by primary care providers. The market is beginning to recognise the benefits of the BREVAGenplus model and more importantly has indicated the need for a breast cancer risk assessment tool that can be readily administered during a wellness visit. Historically, healthcare providers are challenged with the implementation of any breast cancer risk assessment tool, including algorithmic models. The challenge primarily exists in the time necessary to implement a new test in an already time sensitive preventive patient examination visit that offers a relatively low reimbursement benefit.
It is with this in mind, that the next stage of the Company's commercial efforts will be focused on creating an ease of product use protocol that, at a minimum, will maintain the efficiency of a healthcare provider's daily routine. Inherent with the go-forward marketing plan, is to ensure healthcare providers and patients are supplied with consultation tools to alleviate time restraints associated with administering each test.
BREVAGenplus includes medical management that recommends medical risk reduction and lifestyle changes if a patient's results indicate high risk. Although a primary care provider may prescribe medical risk reduction, most primary care providers are requesting a referral site for patients receiving a high risk score. Whether breast surgeon, oncologist or breast centre, the referral site can properly examine and better consult the patient. The approval and acceptance of BREVAGenplus by the referral site represents the completion of the patient management model. With the referral site in place, the primary care provider is in a position to confidently recommend BREVAGenplus to their patient population that qualify, and refer all high risk patients to their preferred specialist.
Therefore, in addition to provider office practice efficiency, the Company is addressing the need for commitment from the high risk centres and specialists. Multiple high risk centres have been updated on the benefits of BREVAGenplus and they in turn have expressed interest or committed to accepting high risk patient referrals from their respective primary care providers. The Company will continue to build this paradigm in the markets currently served by its commercial staff.
Product Development Pipeline Update
Colorectal cancer risk assessment test
On the 29 November 2016, Genetic Technologies announced the signing of an exclusive worldwide license agreement with The University of Melbourne for the development and commercialisation of a novel colorectal cancer (CRC) risk assessment test.
The core technology behind this test was developed by Professor Mark Jenkins and his research team at the University's Centre for Epidemiology and Biostatistics. Results from preliminary modelling studies were first published online in Future Oncology on 1 February 2016, in a Paper entitled "Quantifying the utility of single nucleotide polymorphisms to guide colorectal cancer screening," 2016 Feb: 12(4), 503-13. This simulated case-control study of 1 million patients indicated that a panel of 45 known susceptibility SNPs can stratify the population into clinically useful CRC risk categories. A scientific validation study supporting this work has been recently completed by the University. Genetic Technologies will update the market further once the research findings have been published in scientific literature and are available in the public domain. While the terms of the Agreement are confidential, the Company is pleased to report that this is an important first milestone in the development of a new CRC risk assessment test.
The CRC risk assessment test is intended to help identify patients at high risk for CRC who should be subjected to intensive screening, ultimately reducing the risk of occurrence and death from the disease. Those identified as low risk of CRC can be spared expensive and invasive screening, thereby preventing adverse events and unjustified expenses. The commercial launch of the CRC risk assessment test has the potential to provide a significant health benefit by improving existing screening modalities and compliance among patients most at risk of developing CRC. Risk stratification would also likely influence the age a patient will start screening and the frequency.
Excluding skin cancers, CRC is the third most common cancer diagnosed in both men and women in the U.S. representing an overall lifetime risk of about 1 in 20 (5%). CRC is also the third leading cause of cancer-related deaths in the U.S. when men and women are considered separately, and the second leading cause when both are combined. As with breast cancer, early diagnosis is key as the majority of CRC cases are preventable by early detection and removal of precancerous polyps. According to the American Cancer Society, when diagnosed at an early stage (before the disease has spread outside the colon), the relative 5-year survival rate for CRC is 92% and 87% for rectal cancer, while the respective survival rate for late stage (metastatic) disease is much lower, at 11% and 12%, respectively.
More detail regarding colorectal cancer risk assessment test can be found in the Company's announcement dated 29 November 2016.
Investigator initiated research Agreement with The Ohio State University
On 15 June 2017, Genetic Technologies executed a Clinical Study Agreement with The Ohio State University, Technology Commercialisation Office and Division of Human Genetics. This is an "investigator-initiated" study in which Genetic Technologies was approached to be the collaborating partner, reflecting the growing awareness of the Company's expertise in SNP-based risk assessment.
The terms and conditions of the Agreement are confidential however; Genetic Technologies will supply novel SNP-based genotyping for a clinical research study, through its CLIA laboratory facility, on a fee for service basis. The Company will be responsible for the development and validation of the new assay, although the fundamental technology is similar to the BREVAGenplus test and will fit synergistically into the Company's existing infrastructure and processes. Importantly, if the first phase of the study is successful, several other major genetics centres in the U.S. have expressed an interest in joining the study. This collaborative study provides two tangible benefits for the Company:
(i) engagement and collaboration with high profile cancer genetics researchers in the U.S. who are at the forefront of risk assessment research; and
(ii) the resulting data can be used to inform the design of future pipeline products
As with the exclusive worldwide license agreement with The University of Melbourne for the development and commercialisation of a novel colorectal cancer risk assessment test, this Agreement represents another milestone for the Company as it seeks to diversify its product pipeline and become a key player in the SNP-based cancer risk assessment landscape.
Clinical Studies and Peer-Review Publication Update
The Company's transition from a traditional reimbursement system through insurance providers, to a direct patient self-pay program has enabled the de-emphasis of clinical utility studies designed to achieve reimbursement coverage through the private insurers. With the realignment of the product to USPSTF guidelines on risk reduction, the output of two questionnaire-based clinical studies, which commenced in Q4 FY16, is being re-evaluated in light of the product change, and is likely to be combined with data from other studies for publication purposes.
Signed on behalf of Genetic Technologies Limited
Date: 27 July, 2017
Executive Director and Chief Executive Officer
FOR FURTHER INFORMATION PLEASE CONTACT
Mr. Eutillio Buccilli
Executive Director & Chief Executive Officer
Genetic Technologies Limited
+ 61 3 8412 7050
Jamien Jones (USA)
Blueprint Life Science Group
+1 (415) 375 3340, Ext. 5