Molecular Diagnostics cites Cedar's economic analysis of Genomic Health's Oncotype DX as a valuable and compelling argument which justifies premium pricing of the assay to payors
Menlo Park, CA, USA May 5, 2009–In 2005, John Hornberger, MD, MS, (Founder/Principal) and colleagues performed a comprehensive economic analysis which demonstrated that the Oncotype DX breast cancer assay developed by Genomic Health, Inc., can reduce treatment costs when used with women who have node-negative, estrogen receptor-positive early-stage breast cancer. Combined with Genomic Health’s empirical evidence of Oncotype DX’s clinical effectiveness, the rigorous analytic model showed that, even under conservative assumptions, the assay would improve overall medical outcomes for patients while maintaining economic efficiency. The results of the analysis, entitled "Economic analysis of targeting chemotherapy using a 21-gene RT-PCR assay in lymph-node-negative, estrogen-receptor-positive, early-stage breast cancer," was published in The American Journal of Managed Care, and provided the foundation for favorable reimbursement coverage policies across the US, including those under such plans as Medicare, United Healthcare, CIGNA, Aetna, and Kaiser Permanente.
Molecular Diagnostics recently published an article in its Business & Medicine Report underscoring the need for more compelling arguments, both clinical and economic, in justifying the premium prices proposed by diagnostics companies to physicians and payors. This is especially critical for those companies hoping to recover from increasing R&D and marketing costs. The article, “How to earn the economic payback diagnostics companies deserve,” cites the Oncotype DX model as “a gold standard in novel diagnostics economic analysis.” The analysis, led by Dr. Hornberger, was recognized as an exemplary model that serves as a robust “backbone of the assay’s cost-effectiveness case,” and that represents the type of publication valued by payors, physicians, and government health agencies, in assessing the worth of an emerging technology.