Grail Cancer Test Nears FDA Approval Amidst Reimbursement Questions
Translated & summarized from Globes by baba
Grail's blood test for detecting over 50 cancer types has received a positive recommendation from an FDA advisory committee, nearing approval. The test, which advanced detection from stage 4 to 3 in trials, faces questions about insurance reimbursement. Meanwhile, Israeli company PolyPid terminated a European marketing deal but secured a more favorable U.S. agreement. Two new Israeli deep-tech incubators and a grant for rapid diagnostic test development were also announced.
The story in 6 lines · by baba
- Grail's multi-cancer blood test received a positive FDA advisory committee recommendation, nearing approval.
- The test advanced cancer detection from stage 4 to stage 3 in clinical trials.
- Insurance reimbursement for Grail's test remains a significant question for market adoption.
- Israeli firm PolyPid terminated a European marketing agreement but secured a better U.S. deal.
- Israel will launch two new deep-tech incubators with an 80 million shekel investment.
- Poriya Medical Center received a 1 million shekel grant for rapid diagnostic test development.
Grail, a company developing a blood test to detect over 50 types of cancer, has received a positive recommendation for FDA approval from an advisory committee. This recommendation typically leads to final approval, and the news boosted Grail's stock, which has surged 94% in the past month, valuing the company at $6.9 billion. While a previous clinical trial showed the test could advance cancer detection from stage 4 to stage 3, it did not reach earlier stages as hoped. Grail argues that recent treatment advancements make this improvement significant. Grail's President and Chief Medical Officer, Harpal Kumar, believes such tests will become routine. The company already offers the test in the U.S. via a CLIA pathway, but FDA approval is expected to accelerate market adoption.
A key question remains regarding insurance reimbursement. Insurers need to be convinced the test not only extends lives but also saves money long-term. However, if the U.S. Preventive Services Task Force designates the test as important for public health, insurers may be legally obligated to cover it. Currently, the test costs $950 in the U.S. and approximately 4,000-5,000 shekels in Israel. Analysts project that widespread insurance coverage and annual testing for individuals aged 50 could generate $18 billion in annual revenue for Grail, posing a significant financial burden on insurers and potentially on national health systems.
In other news, Israeli company PolyPid announced the mutual termination of its European marketing agreement with Advanz Pharma. PolyPid received about $2.6 million as an advance in 2022. Despite earlier negative trial results, the company reported success in a subsequent trial and has applied for FDA and European market approval for its antibiotic-eluting implant, designed to prevent surgical infections. PolyPid has also signed a more lucrative marketing agreement in the U.S. and Canada with Azurity, securing an upfront payment of approximately $30 million and potential milestone payments totaling $290 million. PolyPid's stock has risen 47% in the past year, with the company valued at $101 million.
Additionally, the Israel Innovation Authority will invest 80 million shekels in two new deep-tech incubators focusing on human-machine interfaces and physical AI. One incubator, Augmenta Health, is a collaboration involving aMoon, Elbit, Ichilov Hospital, Birad (Bar-Ilan University's commercialization company), and Opimpact. It will focus on health applications, neurotechnology, and robotics. The Authority will also invest in startup rounds through its venture fund. Separately, Poriya Medical Center and Bar-Ilan University's medical faculty received a 1 million shekel grant to develop rapid Point-of-Care Testing (POCT) diagnostic tests.